Tata Group Case Analysis: Challenges Faced by Tata Motors and Quality Issues

This case analysis explores the challenges faced by Tata Group, including leadership challenges at Tata Motors and quality issues with legacy products. The biggest challenge faced by the company is cultural diversity. The article recommends a rectification strategy and personal involvement from recognizable company representatives to regain stakeholder trust.

[TATA GROUP CASE ANALYSIS]
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2018
TATA GROUP
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Contents
1. Source Problem........................................................................................................................3
2. Secondary Problems...................................................................................................................3
2.1 Tata Motors faces leadership challenges...............................................................................3
2.2 Tata Group Suffered from quality issues, legacy products....................................................3
3. Analysis....................................................................................................................................4
3.1 Tata Motors faces leadership challenges..........................................................................4
3.2 Tata Group suffered from quality issues, legacy products................................................4
4. Alternatives..............................................................................................................................4
4.1 Tata Motors can employ various mortification strategies.................................................4
 Repentance: means asking for forgiveness.......................................................................4
 Remediation......................................................................................................................4
 Rectification......................................................................................................................4
5. Recommendations and Justifications.......................................................................................5
6. Implementation Control and Follow up...................................................................................5

1. Source Problem
Tata group is one of the very well known and respected group of businesses. The Tata
Group foundation was laid down by Jamsetji Nusserwanji Tata in the year 1868 when a
private trading company was started by him. Tata Group is an Indian Multinational
having its headquarters in Mumbai, Maharashtra. The company purchased various global
companies after which it gained the international recognition. There are about 100
companies operated by the Tata Group.
There are various companies that includes consultancy services, teleservices, Steel ,
hotels, beverages, motors and tele-communication services provided by the Tata Group.
The biggest Challenge that is being faced by the Tata group is Cultural Diversity. Tata
has been always expanding its operations globally which poses a threat on how it shall
handle the various diversity in different cultures.
2. Secondary Problems
2.1 Tata Motors faces leadership challenges
After the retirement of Ravi Kant in the year 2009 there were many challenges related to
the changes and performance of Tata Motors. There were many financial losses that were
suffered by the company. The market share of the company decreased to a large extent

(Raj, 2017). There were many challenges faced by Jaguar Land Rover and various other
commercial vehicles.
2.2 Tata Group Suffered from quality issues, legacy products
According to various reports it has been seen that Tata group was not able to come up
with new products in competitive market (Press Trust of India, 2016). There was a very
adverse impact on its brand when Tata Motors suffered from quality and service
responsiveness issues and product portfolio. It was said that the company was not coming
up with new products. Even the existing product lines during this time required a lot of
work so that the company can make sure that various aspirational products are going in
the future. The company had various issues in its services as well as sales due to which
the brand value of the company was deteriorating day by day. The Company was
planning to launch a new product line in the near future for overcoming the issues that it
was facing during this time.
3. Analysis
3.1 Tata Motors faces leadership challenges
Tata motors was formerly known as TELCO and has its headquarters in Mumbai it is a
multinational automotive manufacturing company and is a member of Tata Group. The
products of Tata group includes trucks, coaches, vans, sports cars, cars and military
vehicles.

After Cyrus Mistry joined the Tata motors in the year 2012, there were many newest car
launches developed under his supervision. But, according to the results of fiscal year
2014-2015 the sales were very less which was very disappointing as the sales declined to
the lowest level. The total market share fell to 14.1% which was all time low whereas the
profit after tax reported a loss of INR 738.95 crores which was the highest standalone
loss ever. It was felt that handling Tata Motors was not a job of the Group Chairman
alone and a competent and stable leadership was required (Bhalla & Kang, 2016). There
were no proper visions used by Cyrus Mistry with no proper corporate governance.
3.2 Tata Group suffered from quality issues, legacy products
The Tata Group was suffering with huge losses and disastrous sales. The services were poor, the
relations of the dealers were not up to the mark (D, 2018). There were frequent leadership
changes and stunned global dreams. The Tata Motors was pushed to margins of the Indian car
market due to which it suffered a standalone loss of INR 4,739 crores at the end of 2015. There
was prolonged economic slowdown due to which there was a huge decline in the sales. It was
admitted by Butschek that there was some loss of momentum in the second half of the year (Raj,
www.livemint.com, 2016).
4. Alternatives
4.1 Tata Motors can employ various mortification strategies
The strategies that are used by the companies to win the forgiveness of the stakeholders as well
as the public so that the stakeholders can accept the crises prevailing, this strategy is known as
mortification strategy (Rodrigues, 2010). Some of the mortification strategies are:

 Repentance: means asking for forgiveness.
 Remediation: it involves offering any form of compensation to the victims.
 Rectification: take precautions or actions so that the same kind of crises are not repeated
again in the future (Mandavia & Kalesh, 2018).
From the above mentioned strategies the strategy that has been adopted by the Tata group is the
“rectification strategy” in which a statement has been released by the company that they are
engaging themselves in to a phased action that is going to bring a positive change in the working
conditions of the organization (Vijayraghwan & Kalesh, 2018).
5. Recommendations and Justifications
It is recommended that only releasing a statement of a planned action is not sufficient rather the
company shall step out and address the issue personally. It is advisable that some recognizable
person from the company comes forward and tries to gain the trust of the stakeholders again.
6. Implementation Control and Follow up
The company shall get itself involved actively in the various action plans so that the stakeholders
are aware that the company is taking all the problems very seriously and actively participating to
bring back the company on track. The Stakeholders shall be kept updated about the working of
the action plans so that the same can help keeping them in loop. While staffing it is important
that the staff shall be selected after proper screening and roles shall be assigned to them
carefully. The careful selection will help in staffing a person who is best and expert in his field
and hence can prove out to be an asset for the company.

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