International Business Analysis Report: Tata Motors' Strategies

This report provides a comprehensive analysis of Tata Motors' international business operations. It begins with a company profile and examines the company's status in relation to the globalization of business, referencing the Uppsala model to understand its international expansion. The report then delves into regional factors, specifically using PESTLE analysis to assess how political, economic, social, legal, and environmental factors in the UK impact Tata Motors' business choices. Porter's diamond model is applied to evaluate the company's competitive position in international markets, focusing on factor and demand conditions, related industries, and firm strategy. Furthermore, the report explores Tata Motors' foreign entry strategies, particularly its use of direct exporting, and discusses the associated advantages and disadvantages. Finally, the report identifies key business challenges faced by Tata Motors and suggests areas for the multinational corporation (MNC) to focus on for future growth and success. The analysis covers a wide range of topics, providing a holistic view of Tata Motors' international business landscape.

INTERNATIONAL
BUSINESS ANALYSIS

Table of Contents
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
Question 1 Company profile.......................................................................................................3
Question 2 Analyses Company’s status related to 'globalisation of business'............................4
PART 2............................................................................................................................................5
Question 3 Regional factors affects company's choice of country.............................................5
Question 4 Porter's diamond model............................................................................................6
PART 3............................................................................................................................................8
Question 5: Foreign entry strategies...........................................................................................8
PART 4............................................................................................................................................8
Question 6: Key business challenges of a company...................................................................8
Question 7: What areas the MNCs needed to focused................................................................9
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Multinational Corporation is the enterprise which provides services in more than two
countries. It has a powerful influence on local economies and international relations. The
behaviour of MNCs is different in relations to human resource, marketing, finance and other
elements regards to the goods or services (Gold,Seuring and Beske, 2010). Thus, the main
characteristics of the multinational corporation are that they are big in size and overall activities
are controlled at central level through the parent firms. The report has been studied in context to
Tata motors that are discussed further on key international business challenges. It also defines
the area which will be required to focus in their future and current business.
PART 1
Question 1 Company profile
Multinational Corporation is that enterprise that has an assets and other facilities which
are required at least one country rather than their home country. It is that type of companies in
which it factories or offices in other different countries. Thus, where they have a coordinate
global management where have a generally centralized head office. It generates high paying jobs
and also delivers technologically advanced products in the countries (Tarique and Schuler,
2010). They tend to develop their operation in those markets where its capital is effective or
lowest wages. They provide products to the country with same quality at lower cost; it also
minimizes prices and improves purchasing power of customers at the worldwide. Tata motors
Limited is a leading international automobile manufacturer and it is one of the 18th world largest
motor vehicle manufacturer firm, 2nd largest manufacturer of bus by its volume and 4th largest
truck manufacturer. It has wide range of product portfolio which mainly includes sports vehicles,
buses, cars, defence vehicles, construction equipment and buses (Harzing,Reiche and Pudelko,
2013). They are now operating their business over 175 countries around the world and its
turnover is 32.31 million. Global footprint of Tata motors is that they are now selling their
vehicles products in 50 countries approx. Thus, it logo went at international level in 1961 year
and it also selling trucks, buses and cars products at 20 locations all over the world and ranks 7 th
in India. The rest part are mainly involves in South Korea, South Africa, UK, Thailand, Spain
and Indonesia.

Question 2 Analyses Company’s status related to 'globalisation of business'
Uppsala model shows the procedure of globalisation of business which emphasis that the
companies will tend to globalize and eventually move more towards distinct markets. It is those
models that show the company internationally expanded in various types of service industries.
The model also suggested to the company whether to expand their business internationally as per
its psychic closeness to the host country (Kolk and Van Tulder, 2010). It gives facilitates to
obtained knowledge about company's past international operations and facilitates foreign entry
model decisions. It is based upon whether the firm started manufacturing in home country or host
country. Thus, the primary decision can be made through adopting uppsala model that related to
exporting versus foreign (local) production. The second decision is related to who should control
the manufacturing process.
Illustration 1: Uppsala model
Source:( Flack,2010)

The uppsala model is applied to gain knowledge of Tata Motors’s past international
operations. It has been analysed that the company branded vehicles are played at global level
with over 8.5 million. It is one of the automobile manufacturer firms all over the world and
offers an extensive product portfolio to their customers. It is in businesss since 1961 as an
international footprint by exports (Kotton and et. 2010). The above figure shows that the
company status can be analysed through mode of operations in various countries. Thus, there
internationalization can be judged on the basis of their international commitment and geographic
diversification. It can be understood by their country sporadic export, export modes, foreign
production and sales subsidiary. Tata motors expanded its business in international countries
such as countries such as India, Thailand, Spain, UK, USA and South Korea etc. Therefore, it
has been evaluated that the Tata motors takes seriously their geographical diversification as its
sold vehicle products in more than 129 countries. It has solidifying international market presence
and expanded its manufacturing facilitates all over the world. Apart from this, the company also
explores new markets by making commitment to support them with its pioneering technology
goods, add value to its partnership and offer superior services. Beside this, Tata motor has also
expanded their business internationally at UK country sale revenue is increased from 115.7 bn to
74.54 bn.
PART 2
Question 3 Regional factors affects company's choice of country
Pestle Analysis is that framework that analyzes various factors such as political, social,
legal, and economic and environment factors. It directly affects business operations and their
activities in both positive and negative manner. Tata motors internationalize their business in UK
country for which it becomes necessarily to analyse regional factors of the host country (Tanaka
and et. 2012). Therefore, they can formulate and implement their global strategy accordingly
which can help in carrying out the operations effectively. There are several factors of host
country which are needed to be analysed by firm which are as described as follows:-
Economic factors: - Economic factors mainly include exchange rate, inflation rate and
GDP rate etc which are affecting the automobile companies. In case, if the country’s economic
condition is bad then the prices of their products declines and vice-versa. The UK economic
condition is strong as compared to other countries due to which consumer purchasing power is
increasing. It directly leads to increase sales of a products or services of automobile firm. In

context to the Tata motors company, it has been analysed that they can generate high sales
revenues from UK country. Therefore, the positive condition of country gives opportunities to
automobile firm to increase their sales revenue by keeping their price of products higher.
Political factors: - The political factors which are mainly involved are labour law, trade
restriction, political stability and tariffs (Collings, Scullion and Vaiman, 2011). The government
regulated or monitored regulation of a country due to which it directly impacted the operation of
a company. In context to UK, country taxes on the luxury vehicles are higher as it directly affects
profitability of automobile firms. Therefore, there is also fluctuation of taxes and import rules of
UK countries which impacts the demand of its products. In regard to this, Tata motor is required
to monitor rules which are formulated by UK government.
Social factors:- It is that type of factors that are mainly involves a career attitude, growth
rate, awareness, age distribution and trends. Thus, if there is any fluctuation of all these aspects
than it directly affecting the company's product demand and their operations. They have to
adapts their management strategies as per the changes in social trends (Mudambi and Swift,
2011). In context to automobile industry they are now demanded by everyone as they played a
vital role. It has been analyses that the UK consumers attitudes, taste and preferences are positive
towards the automobile goods. In regard to this, Tata motors sales revenues can be improves by
expand their business in a host country.
Question 4 Porter's diamond model.
It is the American strategy that are used by the company to analyse the competitive
position in international markets. The benefits from this theory is to develop how the company
can convert national advantages to international advantages. In regard to this, Porter's diamond
model is adopted to analyse its position in global markets. Thus, it mainly involves four
determinants that are described as follows:-

 Factors conditions:- Tata motors have a huge opportunity of human resources in
their home country. Thus, it hire the young candidates from various parts of a
country from several universities. They bring all them together to explore their
knowledge and perfectly infrastructure. It has a excellent working condition as
there is highly educated people are able to work with its corporation (Dellinger
and et. 2013). In regard to this, it has been analysed that there a huge demand of
home country in terms of their growth, quality improvement and innovation.
Thus, they can effectively expand their business in UK country effectively.
 Demand conditions:- Tata motors has a rapid growth in their home country as
they get more competitive advantages. They created their brand name for its
innovation and it also developed cheap car. Thus, it produced a healthier
competition with their competitors. In regard to this, if the home country is more
demanded then it will also be increased business at global level.
 Related and supporting industries:- Tata motors has adopted
internationalization strategies that has been greater success in their automobile
industry (Boussebaa, Morgan and Sturdy, 2012). It has been analysis that they can
effectively start to expand their business at international level with the assistance
of merging activities. They have a strongest firm in their industry that will be
remains unique to its challenges among their competitors.
Illustration 2: Porter's diamond model
Source:(Lauring and Tange,2010)

 Firms strategy, structure and Rivalry:- Globalisation gives an opportunity to
their company to internationalise their business. For this, they have to analyse
their market position and its necessity for its goods to the local buyers. In regard
to this, the company needed to analysed the aspects of required of family car in
the UK economy.
PART 3
Question 5: Foreign entry strategies
There are various type of international strategy that assist the company to enter into a
foreign market. It can be of various that involves direct or indirect exporting, joint venture,
licensing etc. Tata motors company adopts exporting foreign entry mode strategy to expand their
business internationally such as UK country. Exporting can be stated as that the marketing of
produced generated in one country to other (Madura, 2011). It can be categorised into two parts
are direct and indirect exporting. The company adopts direct exporting entry mode strategies in
which they can direct sold their products into the target market. It has a both advantages and
disadvantages of exporting that are described as follows:-
Advantages
It is a less risky as the manufacturing is based upon the home based country.
It gives an opportunity to learn about overseas markets before their investment in mortar
and bricks.
It also minimizing the potential risks of their operating overseas.
Disadvantages
It needed a higher investment of resources, time, personnel as well as organisational
fluctuation.
It requires a huge information.
There is high start up cost as well as risk that are directly opposed to indirect exporting.
PART 4
Question 6: Key business challenges of a company
The key business challenges of Tata company is that there is dominance in their
commercial vehicles market. It will be challenges through the enter of global brands that are
mainly involves a Ratan Tata, Navistar, Volvo, Tata group and Tata group etc. In regard to this,
the company was made to meet their business challenges with better and new products. It has

been analysed that the UK country is more demanded for automobile products. In regard to this,
they should needed to focus on future by analysed their competitors (Ruigrok and Van Tulder,
2013). Thus, the customer of vehicles products are more demanded, competition in now becomes
stronger. For this there is needed to execute their strategy with perfection and speed.
Thereafter, there is required to consider external environment of UK country while they
expand their business operations. It mainly includes high interest rate, economic conditions.
Therefore, they also have to focus on the areas for future expansion by investment in relevant
products and will continue to enhance customers experience.
Question 7: What areas the MNCs needed to focused
The Tata motors needed to be focused on current and future business as they are needed
to focus infrastructure, realty, defence and aerospace, retail, consumers and financial services.
They have to focus on their sales revenues that can be improves in the future time period by
provide a high quality of its products or services to its customers (Hill, Cronk and
Wickramasekera, 2013). The current business of a Tata is that they are operating in more than
175 countries across global level. Thus, deliver a wide of products that are provided in these
countries to gain a competitive advantage.
In regard to their current business operation they can effective analyse their business
operations as the sales of a company is increased year by year. For this, they can be expected that
it will be also increasing in its vehicles products by customers in future time period. They have to
mainly focused on the external or market environment factors while expanding their business in
foreign country.
CONCLUSION
Summarizing the whole report it has been analysed that the Tata motors increasing
international as they have an international market commitment and international diversification.
It can be analysed the company status through adopting Uppasla model in which there status in
UK country is that there sales is increased from 2010 to 2016. Further, they needed to analyse
regional factors at the time of expanding their business in host country. It has been also
recommended that the company should adopts porter's diamond theory to understand the demand
condition and supportive material to expand internationally.

REFERENCES
Books and journals
Boussebaa, M., Morgan, G., and Sturdy, A.2012. Constructing global firms? National,
transnational and neocolonial effects in international management consultancies.
Organization Studies. 33(4), 465-486.
Collings, D. G., Scullion, H., and Vaiman, V. 2011. European perspectives on talent
management. European Journal of International Management. 5(5), 453-462.
De la Mothe, J., and Paquet, G. 2012. Local and regional systems of innovation (Vol. 14).
Springer Science and Business Media.
Dellinger, R. P. and et.al., 2013. Surviving Sepsis Campaign: international guidelines for
management of severe sepsis and septic shock, 2012.Intensive care medicine. 39(2), 165-
228.
Flack, J. M. and et.al., (2010). Management of high blood pressure in blacks an update of the
international society on hypertension in blacks consensus statement. Hypertension. 56(5),
780-800.
Gold, S., Seuring, S., and Beske, P. 2010. Sustainable supply chain management and inter‐
organizational resources: a literature review.Corporate social responsibility and
environmental management. 17(4), 230-245.
Harzing, A. W., and Pinnington, A. 2010. International human resource management. Sage.
Harzing, A. W., Reiche, B. S., and Pudelko, M. 2013. Challenges in international survey
research: a review with illustrations and suggested solutions for best practice. European
Journal of International Management. 7(1), 112-134.
Hill, C. W., Cronk, T., and Wickramasekera, R. 2013. Global business today. McGraw-Hill
Education (Australia).
Kolk, A., and Van Tulder, R. 2010. International business, corporate social responsibility and
sustainable development. International business review. 19(2), 119-125.
Kotton, C. N. and et.al.,2010. International consensus guidelines on the management of
cytomegalovirus in solid organ transplantation. Transplantation. 89(7), 779-795.
Lauring, J., and Tange, H. 2010. International language management: Contained or dilute
communication. European Journal of International Management. 4(4), 317-332.
Madura, J. (2011). International financial management. Cengage Learning.
Mudambi, R., and Swift, T. 2011. Leveraging knowledge and competencies across space: The
next frontier in international business. Journal of International Management. 17(3), 186-
189.
Ruigrok, W., and Van Tulder, R.2013. The logic of international restructuring: The management
of dependencies in rival industrial complexes. Routledge.
Scullion, H., and Collings, D. (2011). Global talent management. Routledge.
Tanaka, M. and et.al., 2012. International consensus guidelines 2012 for the management of
IPMN and MCN of the pancreas. Pancreatology,12(3), 183-197.
Tarique, I., and Schuler, R. S. 2010. Global talent management: Literature review, integrative
framework, and suggestions for further research. Journal of world business. 45(2), 122-
133.

Online
Bakery Marketing Strategies. 2016. [Online]. Available through:
<http://www.startupbizhub.com/bakery-marketing-strategies.htm>. [Accessed on 24th May,
2017].