INDIAN BUSINESS HOUSE REPORT ON THE TATA GROUP
INDIAN INSTITUTE OF EDUCATION AND BUSINESS MANAGEMENT (IIEBM), PUNE MEba(2008-2010)
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ACKNOWLEDGEMENT We wish to express our sincere gratitude to director jai singh marwah who gave us an opportunity to learn something new on the basis of political aspect. It is due to him we came to know deeply about the tata group.we also thank prof. arjun madan who guided us on preparing this project.
GROUP NAME SPRINTERS
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GROUP LEADER TANVI R. SAWAL GROUP MEMBERS
REG NO. SECTION
TANVI R. SAWAL
336
VINDHYAS
207
VINDHYAS
VIVEK KAPOOR SHASHANK PANDEY
119
VINOD KUMAR YADAV
266
CHANDRANSHU SRIVASTAV
23
SOURAV SACHDEV ISHAN YADAV
VINDHYAS VINDHYAS VINDHYAS
02
VINDHYAS 144
SHIVALIK
Contents OF INDIAN BUSINESS HOUSESs Section – I 1. Origin and founder. 2. Brief History, Vision and Mission. 3. Core business when started / established. 4. Business philosophy and policies. 5. Progress over the years. Section - II 1. 2. 3. 4. 5. 6. 7.
Organization and Management Structure. Revised Vision, Mission and Outlook. HR, Marketing, Finance & Safety Policies. Corporate Governance. Approach towards the Environment, Pollution and Ecology. CSR and its implementation. Name and Performance of the Companies controlled by the Business House (companies controlled by the Business House / Industry verticals they have entered into, their Product Lines, Market Share, their
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Page No. 06 09 16 20 23 28 45 48 54 98 103 109
Major competitors, Export Earnings, Market Capitalization, Technology absorption and major innovations).
8. Impact of LPG on the Current and Future Business Prospectus. 9. Important Milestones and Turning Points. 10. Progress over the years. Section - III
158 168 171
1. Future Prospectus and Outlook. 2. Succession planning. Section – IV
182 185
1. Brief on the Stalwarts and their role in shaping the Business house. 2. Conclusion. Bibliography
BREAK-UP OF WORK LOAD • Section – I Points 1 – 3 (Chandranshu Srivastav) Points 4 - 5 (Vinod Kumar Yadav)
• Section – II Points 1 – 3 (Tanvi R. Sawal) Points 4 – 7 (Vivek Kapoor) Points 8 – 10 (Shashank Pandey)
• Section – III 4
193 203 205
Points 1 & 2 (Saurav Sachdev) • Section – IV Points 1 & 2 (Ishan Yadav)
Origin and founder
The story of the Tata Group of business unfolds with the birth of its founder Jamshedji Tata in the small town of Navasari in Gujarat in 1839. He breathed his last in 1904 in Germany. His parents were Nuseerwanji and Jeevanbai Tata. Nusserwanji was the first businessman in a family of Parsi Zorastrian priests. Destiny called him to Bombay where he started trading. Jamshedji joined him at the tender age of fourteen. He took admission in Elphinstone College and while still a student he married Hirabai Daboo. Jamshedji graduated in 1858 and joined his father trading firm. Those were turbulent times. The British had just managed to ruthlessly crush the 1857 Revolt. Since the age of twenty-nine Jamshedji continued to work in his 5
father’s firm. In 1868 he started a trading company on his own with a capital of Rs.21, 000/- His first step was to acquire a bankrupt oil mill and convert it into a cotton mill which he renamed Alexander Mill. Two years later he sold it with a good margin of profit. With this he set up a cotton mill in Nagpur in 1874. Queen Victoria had just been declared the Empress and in keeping with the times Jamshedji named it Empress Mill.Jamshedji was a unique personality. He did not just think of innovative ways of manufacturing textiles but he devised new labor practices that would satisfy the workers. In this way he was far ahead of his times. It was not just his own personal success but also of those who worked for him and his group. Jamshedji was in close contact with revolutionary thinkers and nationalists like Dadabhai Naoroji and Pherozeshah Mehta and strongly influenced by them. He came to the conclusion that economic self-sufficiency should go hand in hand with political independence. The former should be the base of the latter. Jamshedji had three key ideas in mind. He wanted to set up an iron and steel company, world class learning institution and a hydroelectric plant.
Unfortunately during his lifetime none bore fruit but he had planted the seed, which later took roots and spread its branches under the care of his successors. The only achievement that he lived to see was The Taj Mahal Hotel. It was completed in December 1903 for a princely amount of Rs.4, 21, 00,000/-In this too he was inspired by nationalist thinking. In those days the locals, that is Indians, were not allowed into the best European Hotels. Taj Mahal Hotel was a befitting reply to this discrimination. Tata Group is a private conglomerate with headquarters at Mumbai. The present Chairman is Ratan Tata who took over from J.R.D. Tata in 1991. A member of the Tata family is always the Chairman of the group. Its operations covers many fields related to industry and allied activities concerned with know-how and its application engineering, information technology, communications, materials, automotive, chemicals energy, telecommunications, software, hotels, steel and consumer goods.The statistics and figures of Tata Group speak for themselves. Its revenue touches $967,229 million or $21.9 billion in 2005/06. This is equal to 2.8% of India’s GDP. There are about 246.000 employees in the Tata group as per records of 2004. Market capitalization figure is $57.6 billion. There are ninety-six companies operating in seven business sectors. Only twenty-eight of the ninetysix in Tata Group are publicly listed. Tata operates in more than forty countries across six continents. It exports products and services to one hundred and forty 6
nations. The Charitable Trust of Tata holds 65.8% of the ownership of Tata group TISCO now called Tata steel set up in 1907 India’s first iron and steel plant in Jamshedpur, which is often called Tatanagar. Production actually started in 1912. It produces steel at the lowest cost in the world. This is mainly because it is assisted by group member concern that deals with the supply of raw material like coal and iron. In 1910 was set up Tata Hydro-Electric Power Supply Company. In 1917 the Tata group made its debut in the field of consumer goods industry with the setting up of Tata Oil Mill dealing in soaps, detergents and cooking oil. 1932 saw the establishment of Tata airlines. Tata Chemicals made its appearance in 1939. Telco now known as Tata Motors started to manufacture locomotive and engineering products from 1945.
January 2007 is a watershed in the history of Tata Group. Tata steel made a successful bid for UK based Corus Group, which was one of the world’s leading steel and aluminum producers. After an unprecedented nine rounds of bidding Tata finally clinched the deal. Tata offered to buy 100% stake in Corus at 608p per share (all cash) totaling to a value of $12.04 billion. It has turned out to be the biggest acquisition by any Indian company. Tata Power is one of the largest private sector companies in India and supplies power to Mumbai and parts of New Delhi. Then there are Tata Chemicals and Tata Pigments. In the service sector there are Tata companies dealing with hotels, general insurance and life insurance. Tata offers management, economic and financial consultancy services. Tata is one of the best names in the world of investments and shares. In the area of education Tata’s publishing house of Tata McGraw Hill is a renowned name. Many renowned public sector companies and research organizations like Indian Institute of Science, Tata Institute of Fundamental Research, Tata Institute of Social Sciences, Tata Energy Research Institute and Air India (Tata Airlines) owe their origins to the name of Tata. Other educational institutes are Tata Institute of Science now Indian Institute of Science, Bangalore, Tata Institute Of Fundamental Research “ deemed University, Tata Management Training center, Pune, Tata Institute Of Social Science “ deemed University and National Centre for the Performing Arts. The name of Tata is linked to consumer durables like tea, watches (Titan) Tata Trent (Westside) to Tata Sky and even gold and diamonds like Tanishq brand of jewellery.In information systems and communications the Tata name comes with 7
Computational & Research Laboratories, INCAT, Nelco, Nelito Systems, TCS and Tata Elxsi. There are software companies Tata Interactive Systems, Tata Infotech, Tata Technologies Ltd, Tata Teleservices, Tatanet etc. Tata acquired VSNL, the Indian telecom giant from Bermuda based Canadian company named Teleglobe in 2005. The aim of Tata Group is to improve the quality of life in the society by virtue of integrity, understanding, excellence, unity and responsibility. The entire family known as the Tata Group shares these values. Tata’s contribution to India’s education, science and technology has been widely documented and respected. The blue colored log of Tata speaks for fluidity as well as fountain of knowledge. It can also be seen as a tree under which all are welcome to take refuge.
Brief History, Vision and Mission BRIEF HISTORY 1868
Jamsetji Nusserwaji Tata starts a private trading firm laying the foundation of the Tata group.
1874
The Central India Spinning, Weaving and Manufacturing Company is set up,marking the Group’sentry into textiles. 1902
The Indian Hotels Company is incorporated to set up the taj Mahal Palace ad Tower India’s first luxury hotel which opened 1903.
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1907 The Tata Iron and Steel Company is established to set up India’s fi rst iron and steel plant in Jamshedpur, which started production in 1912.
1910
The first of the three Tata Electric Companies,the Tata Hydro-Electric Power Supply Company,is set up to generate electricity.
1911
The Indian Institute of Science is established in Bangalore to serve as a centre for advanced learning. 1912
Tata Steel introduces eight-hour working days, well before such a system was implemented by law even in most western countries. 1917
The Tatas enter the consumer goods segment as the Tata Oil Mills Company is established to make soaps, detergents and cooking oils. 1932 9
Tata Airlines,a division of Tata Sons,is established, opening up the aviation sector in India. 1939
Tata Chemicals is established.
1945
Tata Engineering and Locomotive Company (renamed Tata Motors in 2003) is established to manufacture locomotive and engineering products. The company began manufacturing commercial vehicles in 1954 in a JV with Daimler Benz. 1952
Pandit Jawaharlal Nehru,India’s fi rst Prime Minister,requests the Group to manufacture cosmetics inIndia; and Lakme is established. 1968
Tata Consultancy Services (TCS),India’s fi rst software services company,is established as a division of Tata Sons
1984
Titan Industries —a joint venture between the Tata Group and the Tamil Nadu Industrial Development Corporation (TIDCO) — is set up to manufacture watches.
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1995
Tata Quality Management Services institutes the JRD QV Award, modelled on the Malcolm Baldrige National Quality Value Award of the United States, laying the foundation of the Tata Business Excellence Model.
1996
Tata Teleservices Limited (TTSL) is established to spearhead the Group’s foray into the telecom sector.
1998
Tata Indica — India’s first indigenously designed, developed and manufactured car —is launched by Tata Motors, spearheading the Group’s entry into passenger cars.
2000
Tata Tea acquires the Tetley Group, UK,in the fi rst major acquisition of an international brand by an Indian group.
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2001
Tata-AIG — a joint venture between the Tata Group and American International Group Inc (AIG) —marks the Group’s re-entry into insurance. The Group’s insurance company, New India Assurance, was nationalised in 1956
2002
The Tata Group acquires a controlling stake in Videsh Sanchar Nigam Limited — India’s leading international Telecommunications service provider. •Tata Consultancy Services becomes the fi rst Indian software company to cross one billion dollars in revenues. • Titan launches Edge,the slimmest watch in the world 2004
Tata Motors acquires the heavy vehicles unit of Daewoo Motors,South Korea. •Tata Steel makes its first major overseas investment in NatSteel Asia, headquartered in Singapore. •Tata Consulting Services goes public in India's private sector's largest initial public offer. 2005
Indian Hotels adds New York's iconic hotel, The Pierre, to its portfolio as also its Ginger "Smart Basics"hotels in India. •VSNL acquires Tyco Global Network,making it one of the world's largest provider of submarine cable bandwidth.
2007
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In a major step in its unfolding strategy of growth and globalisation, Tata Steel acquires Corus, the UK-based steel company, for $ 12.1 bn,the biggest overseas acquisition by an Indian company.Tata Steel is now the world’s 6th largest steel producer with capacity of 26 million tonnes per annum and operations in 24 countries.
Vision and mission The Tata Group is one of India' largest business conglomerates established by Jamshedji Tata (Jamshedji) in the second half of the 19th century. Jamshedji's vision for the Group was in line with nationalist goals and ideals then, and envisaged to make India self-reliant. After Jamshedji, Jehangir Ratanji Dadabhoy Tata (JRD) became the Chairman of the Tata Group and played a significant role in continuing the vision of the group. Tata's assets climbed from INR 620 million in 1939 to INR 100 billion in 1990. Tata Motors had increased its sales to INR 1 million in the year 1991 and it had rolled out 3 million vehicles in the same year. In 1991, Ratan Naval Tata (Ratan Tata/Ratan) took over the Chairmanship from JRD Tata. Although he was initially criticized for his poor performance, over the years, Ratan Tata disproved his critics. He restructured Tata Group's business operations and made the Group compete globally. Under Ratan Tata's chairmanship, Tata Consultancy Services went public and Tata Motors was listed in the New York Stock Exchange. Starting from the late 1990s, Ratan revamped the operations of Tata Steel and made it one of the lowest-cost steel producers in the world. However, as the Tatas lacks an heir who can succeed Ratan, the group is at cross-roads to decide who will be the next chairman. After Ratan Tata's retirement who would succeed him and carry the vision of the Group is a dilemma. Our PEOPLE, by fostering team work, nurturing talent, enhancing leadership capability and acting with pace, pride and passion. Our OFFER, by becoming the supplier of choice, delivering premium products and services and creating value with our customers. Our INNOVATIVE APPROACH, by developing leading edge solution in technology, process and products.
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Our CONDUCT, by providing a safe working place respecting the environment, caring for our communities and demonstrating high ethical standards.
MISSION Our Mission in Tata is to improve the quality of life in India through leadership in targeted sectors of national economic significance to which the Group can bring a unique set of capabilities.
Core business when started / established : 14
Development of Tata Iron & Steel Company: Late 1800s-1980s From the mid-1880s, Tata commissioned a series of surveys in India's coalproducing areas, such as Bihar and Orissa in the northeast of the subcontinent, to locate iron ore within easy reach of coal deposits and water, both essential elements in steel production. He visited the United States to seek the advice of the world's foremost metallurgical consultant, Julian Kennedy, and went to Birmingham, Alabama, to study the coking process in action. In England in 1900, he discussed his plans with the secretary of state for India, Lord George Hamilton. In India, the way had been opened for private enterprise with the introduction of a more liberalized mineral concession policy in 1899. With Julian Kennedy's help, American specialists were brought in and began surveying in 1903. After a series of disappointments, rich iron ore deposits were identified in the dense jungle in Bihar at the confluence of two rivers near Sakchi three years after Jamsetji Tata's death in 1904. Also involved in the surveying was Tata's nephew, Shapurji Saklatvala, whose health suffered so much that he was sent to London to recuperate. There, he joined his uncle's London office, which had been established some years earlier to represent the interests of the family cotton business. His energies were soon channeled away from business matters and into politics, and he became Communist member of Parliament for Battersea North in 1922. Four years after Tata's death, his sons Dorabji and Ratanji began development of the Bihar site. A factory and township were carved from the jungle and named Jamshedpur. A conscious decision was made to retain control within India of the new enterprise, the Tata Iron and Steel Company, by seeking out Indian investors. In the face of warnings that India could not afford a flotation of this size, the Tata brothers set out to raise Rs 23.2 million in shares. Within eight weeks some 8,000 Indian investors came forward and the whole share issue was taken up. The Tatas retained 11 percent of the stock for themselves. There were enormous initial problems in clearing the Sakchi site and, once production began, in ensuring
that the coal was of a uniform quality. By 1916, however, production was meeting expectations and during World War I the company exported 1,500 miles of steel rails to Mesopotamia. Rapid expansion to support the Allied war effort was 15
followed by Depression during the 1920s with escalating prices, transport and labor difficulties, and a major earthquake in Japan, by now TISCO's biggest customer. The company had to suspend its dividend for 12 out of 13 years in this period and was on the brink of closing in 1924 when Sir Dorabji Tata had to pledge his personal fortune to secure the necessary bank loans to keep the business afloat. TISCO emerged from the 1930s, however, as the biggest steel plant in the British Empire. World War II brought a resurgence in demand for Tata products and the company specialized in the manufacture of armored cars, known as Tatanagars, which were used extensively by the British Army in the North African desert. Following six years of almost continuous production to serve the war effort, it became imperative in the late 1940s to begin replacement of the plant. In association with Kaiser Engineering of the United States capacity was expanded and a Modernization and Expansion Program (MEP) was launched in 1951, upgraded four years later to the Two Million Ton Project (TMP) to give TISCO the capacity to produce two million tons of crude steel. This was achieved in 1958 but further expansion was put on hold during the 1960s while the country passed through a period of devaluation and recession. By 1970, however, TISCO employed 40,000 people at Jamshedpur, with a further 20,000 in the neighboring coal mines. Government attempts to nationalize TISCO in 1971 and 1979 were defeated, in part, it was believed, to retain an efficient private sector yardstick against which the performance of public sector companies could be judged. An ever-increasing range of government legislation to bring private sector businesses into line with national economic planning on the Soviet model, however, hampered Tata's freedom to develop in the postwar period. In 1978, the government restricted TISCO's dividend to 12 percent to force it, as India's only private sector steel producer, to plough money into modernization. Expansion was restricted by a government committed to helping nationalized industry. Further difficulties were created in the late 1970s by chronic shortages of coal, power, and rail transport. An estimated Rs 45 crores of salable steel was lost during 1979-80 because of these
shortages. TISCO soldiered on, however, and in the following decade began to benefit from a relaxation of government control as a more pragmatic attitude to the 16
importance of private sector industry emerged. In 1989, the Tata group increased its stake in the steel firm to ward off any attempts by outside shareholders to gain control of the company. By 1990, TISCO remained India's largest nonpublic company, announcing a 30 percent increase in profits against a backdrop of general depression in the Indian economy as a whole. Promoter companies Tata Sons,Tata Industries,Group holding structure Tata Sons and Tata Industries are the two promoter companies of the Tata Group.A more detailed profile of these companies can be accesses through the ‘related info’ links on the right.
Tata Sons This premier promoter company of the Tatas was established as a trading enterprise by group founder Jamsetji Tata in 1868.It is the promoter of all key companies of the Tata Group and holds the bulk of sharehoding in these companies. The chairman of Tata Sons has traditionally been the chairman of the Tata Group. Tata Sons is the owner of the Tata name and the Tata trademark, which are registered in India and several other countries.About 66 per cent of the equity capital of Tata Sons is held by philanthropic trusts endowed by members of the Tata family. Tata Industries Tata Industries was set up Tata Sons in 1945 as a managing agency for business it promoted. Following the abolition of the managing agency system, Tata Industries’ mandate was recast,in the early 1980s,to promote the Group’s entry into new and high-tech areas.
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Tata Industries has over the last two decades, initiated and promoted the Group’s ventures into several sectors, including control systems, information technology ,financial services ,auto components, advanced materials and telecom hardware.
Group Holding Structure
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Business philosophy and policies
Philosophy The current growth of our economy and the confidence with which we face the world provide a compelling context in which Corporates need to engage with the disadvantaged sections of our society. The central theme of the Tata Group purpose statement, "Our Purpose in Tata is to improve the quality of life in the communities we serve" is a powerful guiding statement. In the coming years, it will increasingly be necessary for Corporates to encourage and generate internal passion for volunteering and Community service. This will have a positive impact not only on our competitive advantage but also on the corporate reputation.
Policies HUMAN RESOURCE POLICY
Tata Steel recognises that its people are the primary source of its competitiveness. It is committed to equal employment opportunities for attracting the best available talent and ensuring a cosmopolitan workforce. It will pursue management practices designed to enrich the quality of life of its employees, develop their potential and maximise their productivity. It will aim at ensuring transparency, fairness and equity in all its dealing with its employees.Tata Steel will strive continuously to foster a climate of openness, mutual trust and teamwork Tata is committed to create an exciting work pace based on self-directed teams ,improvement and innovative work in environment.
a) Create work conductive to superior performance , which enable employees to realize their full potential through continuous learning and training 19
b) Identify and develop potential leaders for future growth. c) High potential employee working in congenial work environment. Tata Steel recognises that its people are the primary source of its competitiveness. It is committed to equal employment opportunities for attracting the best available talent and ensuring a cosmopolitan workforce. It will pursue management practices designed to enrich the quality of life of its employees, develop their potential and maximise their productivity. It will aim at ensuring transparency, fairness and equity in all its dealing with its employees. Tata Steel will strive continuously to foster a climate of openness, mutual trust and teamwork
Finance Policies A Tata company shall prepare and maintain its accounts fairly and accurately and in accordance with the accounting and financial reporting standards which represent the generally accepted guidelines, principles, standards, laws and regulations of the country in which the company conducts its business affairs. Internal accounting and audit procedures shall reflect, fairly and accurately, all of the company’s business transactions and disposition of assets, and shall have internal controls to provide assurance to the company’s board and shareholders that the transactions are accurate and legitimate. All required information shall be accessible to company auditors and other authorised parties and government agencies. There shall be no willful omissions of any company transactions from the books and records, no advance-income recognition and no hidden bank account and funds.
Any willful, material misrepresentation of and / or misinformation on the financial accounts and reports shall be regarded as a violation of the Code, apart from inviting appropriate civil or criminal action under the relevant laws. No employee shall make, authorise, abet or collude in an improper payment, unlawful commission or bribing. 20
Market Policies A Tata company shall fully support the development and operation of competitive open markets and shall promote the liberalisation of trade and investment in each country and market in which it operates. Specifically, no Tata company or employee shall engage in restrictive trade practices, abuse of market dominance or similar unfair trade activities. A Tata company or employee shall market the company’s products and services on their own merits and shall not make unfair and misleading statements about competitors’ products and services. Any collection of competitive information shall be made only in the normal course of business and shall be obtained only through legally permitted sources and means.
Progress over the years 1868 Jamsetji Nusserwanji Tata starts a private trading firm, laying the foundation of the Tata Group. 1874 21
The Central India Spinning, Weaving and Manufacturing Company is set up, marking the Group's entry into textiles and its first large-scale industrial venture. 1902 The Indian Hotels Company is incorporated to set up the Taj Mahal Palace and Tower, India's first luxury hotel, which opened in 1903. 1907 The Tata Iron and Steel Company (now Tata Steel) is established to set up India's first iron and steel plant in Jamshedpur. The plant started production in 1912. Sets up its first office overseas, Tata Limited in London. 1910 The first of the three Tata Electric Companies, The Tata Hydro-Electric Power Supply Company is set up. The second, Andhra Valley Power Supply Company was established in 1917 and Tata Power in 1919. The first two companies were merged with Tata Power in 2000 to form a single entity. 1911 The Indian Institute of Science is established in Bangalore to serve as a centre for advanced learning.
1912 Tata Steel introduces eight-hour working days, well before such a system was implemented by law in much of the West. 1917 The Tatas enter the consumer goods industry, with the Tata Oil Mills Company being established to make soaps, detergents and cooking oils. The company was sold to Hindustan Levers (now Unilever) in 1984.
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1932 Tata Airlines, a division of Tata Sons, is established, opening up the aviation sector in India. Air India was nationalised in 1953. 1939 Tata Chemicals, now the largest producer of soda ash in the country, is established. 1945 Tata Engineering and Locomotive Company (renamed Tata Motors in 2003) is established to manufacture locomotive and engineering products. Tata Industries is created for the promotion and development of hi-tech industries. 1952 Jawaharlal Nehru, India's first Prime Minister, requests the Group to manufacture cosmetics in India, leading to the setting up of Lakme. The company was sold to Hindustan Levers (now Unilever) in 1997. 1954 India's major marketing, engineering and manufacturing organisation, Voltas, is established.
1962 Tata Finlay (now Tata Tea), one of the largest tea producers, is established. Tata Exports is established. Today the company, renamed Tata International, is one of the leading export houses in India. 1968 Tata Consultancy Services (TCS), India's first software services company, is established as a division of Tata Sons. 23
1971 Tata Precision Industries, the first Tata company in Singapore, is founded to design and manufacture precision engineering products. 1984 The first 500 MW thermal power unit at the Trombay station of the Tata Electric Companies is commissioned.
1995 Tata Quality Management Services institutes the JRD QV Award, modelled on the Malcolm Baldrige National Quality Value Award of the United States, laying the foundation of the Tata Business Excellence Model. 1996 Tata Teleservices (TTSL) is established to spearhead the Group's foray into the telecom sector. 1998 Tata Indica — India's first indigenously designed and manufactured car — is launched by Tata Motors, spearheading the Group's entry into the passenger car segment.
1999 The new Tata Group corporate mark and logo are launched. 2000 Tata Tea acquires the Tetley Group, UK. This is the first major acquisition of an international brand by an Indian business group.
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2001 Tata AIG — a joint venture between the Tata Group and American International Group Inc (AIG) — marks the Tata re-entry into insurance. (The Group's insurance company, New India Assurance, set up in 1919, was nationalised in 1956). 2002 Tata Sons acquires a controlling stake in VSNL (renamed Tata Communications in 2008), India's leading international telecommunications service provider. Tata Consultancy Services (TCS) becomes the first Indian software company to cross one billion dollars in revenues. Titan launches Edge, the slimmest watch in the world. 2004 Tata Motors is listed on the world's largest bourse, the New York Stock Exchange, the second Group company to do so after VSNL. Tata Motors acquires the heavy vehicles unit of Daewoo Motors, South Korea. TCS goes public in July 2004 in the largest private sector initial public offering (IPO) in the Indian market, raising nearly $1.2 billlion.
2005 Tata Steel acquires Singapore-based steel company NatSteel by subscribing to 100 per cent equity of its subsidiary, NatSteel Asia. VSNL (now Tata Communications) acquired Tyco Global Network, making it one of the world's largest providers of submarine cable bandwidth. Tata Sons completes 60 years of Tata operations in the US. The Taj acquires a hotel run by Starwood, Sydney (renamed Blue) and takes over management of The Pierre, NY.
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2006 Tata Sky satellite television service launched across the country. Foundation stone for the Tata Medical Centre unveiled in Kolkata. 2007 Tata Steel acquires the Ango-Dutch company Corus, making it the world's fifthlargest steel producer. TCS inaugurates TCS China — a joint venture with the Chinese government and other partners. Computational Research Laboratories, a division of Tata Sons, develops Eka, one of the fastest supercomputers in the world and the fastest in Asia. The Taj acquires Campton Place Hotel in San Francisco. Tata Steel celebrates its centenary on August 26, 2007. 2008 Tata Motors unveils Tata Nano, the People’s Car, at the 9th Auto Expo in Delhi on January 10, 2008. Tata Motors acquires the Jaguar and Land Rover brands from the Ford Motor Company. Tata Chemicals acquires General Chemical Industrial Products Inc.
organization & management Structure ORGANISATION STRUCTURE
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November 28, 2007
Tata Steel - Organisation Structure of Tata Steel Group ''The CFO is the conscience-keeper of the organisation'', said Tata Steel group CFO Kaushik Chatterjee as he spoke at the 2nd CFO Strategies India 2008 on Monday, 15 September in Mumbai, as he delivered insights on the remarkable rise of Tata Steel and its much-publicised acquisition of Corus last year. Sourya Biswas reports from the venue.
When companies announce their annual reports or bask in the glow of successful deals, it is often the CEOs who take centre stage. However, a lot of the groundwork for a successful venture is done by another important functionary in the corporate machinery, the chief financial officer who goes by the humbler acronym of CFO.
With rapid economic growth and increased globalisation over the last decade, the importance of the finance professional has grown manifold. And for the top finance professional in an organisation, the CFO, the changing dynamics of international business have caused him to adopt and adapt at a frenetic pace. All these and many other details were discussed at the closed27
door two-day CFO Strategies India 2008 summit, organised by Dubai-based Naseba, at the Hotel Le Meridien in Mumbai on 15 and 16 September 2008. On the first day, Kaushik Chatterjee, group CFO, Tata Steel, treated the delegates to an enlightening session. In his 30-minute presentation ''M&A - growth strategy for value creation'', Chatterjee spoke in detail on the growth of the Tata Group in general and Tata Steel in particular, all on the strength of mergers and acquisitions. Of particular interest were his views on the Corus acquisition of 2007 that had occupied the pages of pink sheets worldwide. Chatterjee candidly admitted that the earlier growth of the Tata Group had been largely organic as previous political regimes had not been very conducive to growth by acquisition, either domestic or international. He called the 10 years from 1992 onwards as the ''decade of transformation''. Elaborating on the Arthur D Little recommendations for the group in the early 90s, Chatterjee said that the consultancy had been quite vocal on the group's needs to be internationally competitive, something quite alien to the house of Tata then. However, the steep growth curve that had started in 2000 with Tata Tea's acquisition of Tetley grew even steeper and faster with one acquisition after another by different group companies, topping off with the $12.11-billion takeover of Corus last year.
The meteoric growth of Tata Steel Chatterjee now spoke on the growth strategy for Tata Steel in particular and how it grew to become the sixth-largest steel producer in the world. Of course, he didn't forget to mention that his company continues to be the ''lowest-cost steel producer in the world'' as well. As of 2003, Tata Steel was essentially a one-site company, centred in the pristine 28
locales of Jamshedpur - aptly named after the great man who envisioned the place, Shri Jamshedji Nusserwanji Tata. Although an ideal township where nature is in perfect harmony with steel manufacturing, it was, admittedly, a small operation with only 4 million tonnes annual capacity. Also, even though Tata Steel had a leadership position in finished goods like automobiles and white goods, in many other aspects it lagged behind its competitors. More importantly, as regards a foreign presence, there was none Chatterjee spoke of how the senior management got together at this point of time to envision an aspirational target for the company, as well as brainstorm on how to achieve it. From these high-level discussions emerged a target - 15 million tonnes annual capacity by 2015, subsequently revised to 50 million tonnes - a ten-foldplus increase in just ten-plus years. Of course, the company's jewel in the crown Jamshedpur was to be very much a part of the action. Target capacity was set at 10 million tonnes by 2010, with gradual increments over the years: 4 to 5 million tonnes in 2005 (already achieved), 5 to 6.8 million tonnes in 2008 (on schedule) and 6.8 to 10 million tonnes in 2010 (expected). Reason behind these ambitious numbers Chatterjee explained that such an ambitious target was born out of the management's confidence in a vibrant world economy, with special emphasis on engines of growth like India, China, Russia, South-East Asia and Brazil. Indeed, many of the company's recent investments bear ample testimony to its belief in the strength of emerging economies.
Chatterjee made an interesting observation - whenever a country's per-capita GDP had exceeded $3,000, a metal boom had been witnessed. This was because, according to Chatterjee, there is a strong co-relation between GDP and consumption of metals. With India's GDP almost at that threshold, there was no better time for Tata Steel to spread its wings and fly. In an aside, Chatterjee spoke of the increasing importance of branded steel in the company's scheme of operations - it now accounts for $1.5 billion in annual sales. 29
Chatterjee's assertion that steel items can be branded like FMCG items because they last longer certainly has merit. Coming back to Tata Steel's growth plans, the management had identified that acquisition would definitely play an important part in the company's future plans. This was especially true of developed markets where the costs of establishing Greenfield projects were prohibitive TCS unveils new, agile organisation structure 12 Mar 2008 , Mumbai : Tata Consultancy services , the leading IT services, business solutions and outsourcing organization has announced plans to organize its global operations into integrated, customer-centric units to enhance customer focus, drive operational agility and address new growth opportunities in the market. The new global operating model will provide customers with a single view of TCS encompassing project delivery and relationship management and enable a sharper focus on the customer. This structure will also provide more opportunities for leadership growth at all levels in the organization and encourage the next generation of leaders by empowering group heads to run their unit with growth and profit responsibilities.
“As we scale up over 100,000 employees, TCS needs a structure that allows us to build a nimble organization to capture new growth opportunities,” said S. Ramadorai, CEO and MD. “This will create a framework that is scalable for growth across markets and provide focus on strategic initiatives like asset leveraged solutions, platform-based BPO as well other new initiatives,” added Mr. Ramadorai. “The modular structure will simplify our interface with customers and drive agility in all areas of operations. The structure will also allow us to adapt to specific customer and market requirements while ensuring a uniform global service delivery,” said N. 30
Chandrasekaran, Chief Operating Officer and Executive Director. In the new operating model, all necessary delivery, domain and technology expertise and resources will be embedded in these units to promote greater collaboration with the customer. All operating units will be supported by a common group of organizational infrastructure units, such as the Technology Excellence, Process Excellence, Resource Management, and Shared Services groups. The new structure will also support greater focus for strategic initiatives that will help drive non-linear revenue growth. In addition to TCS Financial Solutions, and the Small & Medium Business Solutions, the company has constituted a new unit for Platform BPO Solutions. These three Strategic Growth Businesses will operate as independent units that will leverage TCS sales, delivery and customer relationships as required.
Organisation Structure of Tata Steel Group Tata Steel Group has set itself an ambition to become one of the leading players in the global steel industry. Tata Steel Group comprise of two entities, namely, Tata Steel (including Tata Steel Thailand and NatSteel Asia) and Corus Group Ltd. In order to realise this ambition, a new organisation is announced today, which is effective from 1st January 2008. 31
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The Chairman of Tata Steel, Mr Ratan Tata will continue to chair the Strategy and Integration Committee. Mr.Jim Leng, Mr.B Muthuraman, Mr.Philippe Varin, Dr. Tridibesh Mukherjee, Mr.Rauke Henstra, Mr.Hemant Nerurkar, Mr.Koushik Chatterjee and Mr.Jean-Sébastien Jacques are members of this Committee.
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A Group Centre is created for functions that are to be performed with a common approach across the Tata Steel Group. These functions are Technology & Integration, Finance, Strategy, Corporate Relations & Communications and Global Minerals. The executives responsible for these functions will report to the MD of Tata Steel and the CEO of Corus:
- Dr Tridibesh Mukherjee is appointed as Group Director, Technology & Integration - Mr Koushik Chatterjee is appointed as Group Chief Financial Officer - Mr Jean-Sébastien Jacques is appointed as Group Director, Strategy - Mr Manzer Hussain is appointed as Group Director, Communications - Mr Arun D Baijal is appointed as Group Director Global Minerals •
Both Tata Steel and Corus entities will have Executive Committees chaired by the MD, Mr B Muthuraman and the CEO, Mr Philippe Varin respectively.
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A Joint Executive Committee for Tata Steel Group will meet quarterly to review overall performance against the Group ambition. This committee will be co-chaired by the MD of Tata Steel and the CEO of Corus.
MANAGEMENT STRUCTURE
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There are two decision-making bodies that define and direct the business endeavours of the Tata Group. These are called the Group Executive Office and the Group Corporate Centre. Group Executive Office : The Group Executive Office (GEO) defines and reviews the business activities of the Tata Group and is involved in implementing programmes in corporate governance, human resources, the environment, etc. The chief objective of the GEO is to make the Tata Group more synergistic; it does this by strengthening the relationship between the Group and its companies. The GEO creates a shared understanding of a Tata company's current activities, its strengths and its weaknesses. It then addresses the most strategic issues facing the company. Apart from this, the GEO has reviewed the Group's business portfolio and clustered companies into seven business sectors. The GEO assesses what unique value a company adds to a particular business sector and, conversely, what unique value the Group can bring to that company. Besides Chairman Ratan N Tata, the GEO comprises R Gopalakrishnan, Ishaat Hussain, Kishor Chaukar,Arunkumar Gandhi and Alan Rosling.
Group Corporate Centre The Group Corporate Centre (GCC) is a forum at which broad policy issues relating to the growth of Tata companies are reviewed and the entry into new areas are discussed. The GCC also plays a key role in protecting and promoting the Tata brand in India and across the globe.The GCC also provides advisory services to Tata companies in the areas of Human Resources, Finance,Legal, and other functional areas as and when required.Apart from this, the GCC from time to time, 33
reviews Tata companies’ business portfolios across business sectors. The GCC comprises Chairman Ratan N Tata, NA Soonawala, JJ Irani, RK Krishna Kumar, R Gopalakrishnan,Ishaat Hussain, Kishor Chaukar, Arunkumar Gandhi and Alan Rosling.
BOARD OF DIRECTORS (As on 14th April, 2008) Mr R N Tata
(Chairman)
Mr James Leng (Non - Executive Deputy Chairman) Mr Nusli N Wadia
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(Company Director)
Mr S M Palia
(Company Director)
Mr Suresh Krishna
(Financial Institutions' Nominee)
Mr Ishaat Hussain
(Board Member)
Dr Jamshed J Irani
(Board Member)
Mr Subodh Bhargava
(Board Member)
Mr Jacques Schraven
(Non - Executive Independent Director)
Dr Anthony Hayward
(Non - Executive Independent Director)
Mr Philippe Varin
(Non - Executive Non independent Director)
Mr B Muthuraman
(Managing Director)
Dr T Mukherjee (Non Executive Director) Mr Andrew Robb
(Non Executive Independent Director)
MANAGEMENT (As on 14th April, 2008)
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Mr B Muthuraman
Managing Director
Mr H M Nerurkar
Chief Operating Officer
Mr A D Baijal
Vice President & Tata Steel Group Director, Global Mineral Resources
Mr R P Singh
Vice President, Engineering Services & Projects
Mr Koushik Chatterjee
Vice President, Finance & Tata Steel Group CFO
Mr Anand Sen
Vice President, Flat Products & TQM
Mr Abanindra M. Misra
Vice President, Raw Materials & CSI
Mr Varun K Jha
Vice President, Chattisgarh Project
Mr Om Narayan
Vice President, Shared Services
Mr Chief Human Resource Officer Radhakrishnan Nair Mr Partha Sengupta
Vice President, Corporate Services
Mr H Jha
Vice President, Safety & Long Products
Mr N K Misra
Vice President & Tata Steel Group Head, M&A
Mr B K Singh
Vice President, Orissa Project
Mr J C Bham
Company Secretary
Mr H C Kharkar Vice President, MD Office, Mumbai
MANAGEMENT STRUCTURE Board of Directors:
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Mr.H.M.Nerurkar Chairman
Mr. Harsh K Jha Managing Director
Mr. Ajoy Roy Independent Director
Mr. A. C. Wadhawan Independent Director
Mr. P. K. Jha Non-Independent Director
Mr. M. V. Rao Independent Director
Mr. Ashok Kumar Non-Independent Director
Mr. Manish Gupta Independent Director
Mr. Dipak Banerjee Independent Director
Mr. A. K. Basu Independent Director
Mr. V. S. N. Murty Non-Independent Director
Senior Management Team Senior Management Team: 37
Mr. Subhasis Dey CFO and Company Secretary Mr. Sudhin C. Mitter General Manager, Marketing & Sales Mr. Rajesh Mishra C.E.O. Tata Metaliks Kubota Pipes Ltd. Mr. Debasish Misra General Manager, Redi SBU Dr. Ashok Mohanty Chief of Human Resources (Corporate) Mr.P.Daniel Kumar Chief Manufacturing System, Kharagpur
Tata Steel, formerly known as TISCO (Tata Iron and Steel Company Limited), is the world's 5th largest and India's largest steel company with an annual crude steel capacity of 28 million tonnes. It is a Fortune Global 500 company with a rank of 315. It is based in Mumbai, India. It is part of Tata Group of companies. Tata Steel is also India's second-largest and second-most profitable company in private sector 38
with consolidated revenues of Rs 1,32,110 crore and net profit of over Rs 12,350 crore during the year ended March 31, 2008. Its main plant is located in Jamshedpur, Jharkhand, though with its recent acquisitions, the company has become a multinational with operations in various countries. The Jamshedpur plant contains the DCS supplied by Honeywell.The registered office of Tata Steel is in Mumbai. In the year 2000, the company was recognised as the world's lowest-cost producer of steel. The company was also recognized as the world's best steel producer by World Steel Dynamics in 2005. The company is listed on BSE and NSE; and employs about 82,700 people (as of 2007).
Management Tata Steel is a limited company registered in India under the Companies Act, 1956. BOARD OF DIRECTORS (As on 14th April, 2008)
Mr R N Tata (Chairman) Mr James Leng (Non - Executive Deputy Chairman) Mr Nusli N Wadia (Company Director) Mr S M Palia (Company Director) Mr Suresh Krishna (Financial Institutions' Nominee) Mr Ishaat Hussain (Board Member) Dr Jamshed J Irani (Board Member) Mr Subodh Bhargava (Board Member) Mr Jacques Schraven (Non - Executive Independent Director) Dr Anthony Hayward (Non - Executive Independent Director) Mr Philippe Varin (Non - Executive Non independent Director) Mr B Muthuraman (Managing Director) Dr T Mukherjee (Non Executive Director) Mr Andrew Robb (Non Executive Independent Director)
MANAGEMENT (As on 14th April, 2008)
Mr B Muthuraman (Managing Director) Mr H M Nerurkar (Chief Operating Officer) Mr A D Baijal (Vice President & Tata Steel Group Director, Global 39
Mineral Resources) Mr R P Singh (Vice President, Engineering Services & Projects) Mr Koushik Chatterjee (Vice President, Finance & Tata Steel Group CFO) Mr Anand Sen (Vice President, Flat Products & TQM) Mr Abanindra M. Misra (Vice President, Raw Materials & CSI) Mr Varun K Jha (Vice President, Chattisgarh Project) Mr Om Narayan (Vice President, Shared Services) Mr Radhakrishnan Nair (Chief Human Resource Officer) Mr Partha Sengupta (Vice President, Corporate Services) Mr H Jha (Vice President, Safety & Long Products) Mr N K Misra (Vice President & Tata Steel Group Head, M&A) Mr B K Singh (Vice President, Orissa Project) Mr J C Bham (Company Secretary) Mr H C Kharkar (Vice President, MD Office, Mumbai) TATA STRATEGIC MANAGEMENT STRUCTURE
Set up in 1991, the Tata Strategic Management Group (Tata Strategic) ranks among the top three management consulting fi rms in South Asia. Mumbai-based but with a presence in SAARC and West Asian countries, Tata Strategic has completed over 500 engagements with more than 100 clients across countries and industry sectors. Its clientele includes medium to large private sector companies in India, multi-national corporations including select Fortune 500 companies, public sector enterprises, the Government of India and a cross-section of companies within the Tata Group.
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Today over 60% of its business comes from non-Tata clients and 25% from international clients. Tata Strategic has a team of more than 70 consultants, recruited from top business schools in India and abroad or laterally from industry. The team is aided by a panel of experts, each with over 20 years of industry domain expertise. Tata Strategic works with clients across the following industry sectors: • Automotive and engineering • Chemicals and energy • Consumer products and retail • Telecom, media and technology • Infrastructure and • Government Tata Strategic addresses ‘top-of-mind’ needs of the client top management through a range of contemporary offerings spanning the areas of strategy formulation, organisation effectiveness, competitiveness enhancement and business analytics.
International Experience Tata Strategic has on-site assignments from clients in Sri Lanka, Bangladesh and multiple countries in West Asia (Saudi Arabia, Yemen and Dubai). Clients from Germany, UK and the United States also work with Tata Strategic frequently. Tata Strategic also formulates India entry plans for global companies and provides implementation support to them. Tata Steel Ltd has informed about the following: - Tata Steel Group has announced a new organization structure effective from 41
January 01, 2008 as follows: Tata Steel Group comprises of two entities, namely, Tata Steel (including Tata Steel Thailand and NatSteel Asia) and Corus Group Ltd. In order to realise this ambition, a new organisation is announced on November 28, 2007, which is effective from January 01, 2008. * The Chairman of Tata Steel, Mr. Ratan Tata will continue to chair the Strategy and Integration Committee. Mr. Jim Leng, Mr. B Muthuraman, Mr. Philippe Varin, Dr. Tridibesh Mukherjee, Mr. Rauke Henstra, Mr. Hemant Nerurkar, Mr. Koushik Chatterjee and Mr. Jean-Sebastien Jacques are members of this Committee. * A Group Centre is created for functions that are to be performed with a common
approach across the Tata Steel Group. These functions are Technology & Integration, Finance, Strategy, Corporate Relations & Communications and Global Minerals.
The executives responsible for these functions will report to the MD of Tata Steel and the CEO of Corus: - Dr. Tridibesh Mukherjee is appointed as Group Director, Technology & Integration - Mr. Koushik Chatterjee is appointed as Group Chief Financial Officer - Mr. Jean-Sebastien Jacques is appointed as Group Director, Strategy - Mr. Manzer Hussain is appointed as Group Director, Communications - Mr. Arun D Baijal is appointed as Group Director Global Minerals * Both Tata Steel and Corus entities will have Executive Committees chaired by the MD, r. B Muthuraman and the CEO, Mr. Philippe Varin respectively. * A Joint Executive Committee for Tata Steel Group will meet quarterly to review 42
overall performance against the Group ambition. This committee will be cochaired by the MD of Tata Steel and the CEO of Corus.
Revised Vision, Mission and Outlook
REVISED VISION 43
Ratan Tata Quotes One hundred years from now, I expect the Tatas to be much bigger than it is now. More importantly, I hope the Group comes to be regarded as being the best in India.. best in the manner in which we operate, best in the products we deliver, and best in our value systems and ethics. Having said that, I hope that a hundred years from now we will spread our wings far beyond India. Vision, implementation, risk taking, and meeting the needs of a changing economy are all apparent in Tata's pet project: the creation of Indica. "I believed in the product. In fact I was very much involved in conceiving its initial fundamentals and design parameters. Yes, it's like seeing a child being born, almost limb-bylimb. Today we have in excess of 50,000 Indicas on the road and I feel a sense of great exhilaration every time I come up next to one. I have an urge to roll my window down, tap on the Indica's window and ask the owner: How do you like it?" A look at the Tata’s strategic plan for Indica.
At the threshold of stepping down from group executive chairmanship, today Ratan Tata can see the results of his grand vision for the group all around him. The Tata Group has turned around loss making companies (Tata Motors), sold non core businesses (ACC, Tomco, Lakme, Goodlass Nerolac, Merind), enhanced existing businesses (Tata Steel, Tata Chemicals, Tata Consultancy Services), entered new industries (telecom), pioneered India's first home grown car (Indica), and is now firmly set on its growth curve. "My main contribution, if you like, is to move us into the high tech areas of business, partly in IT, partly in telecommunications, partly in process control," Tata once told CNBC's Sue Herera. Today, the group has combined revenues of $11.2bn or Rs535bn or 2.4% of India's gross domestic product (GDP). The guiding principle behind Tata's vision is to change with the times. In his own words, "Weshould become a younger organization, an organization of our time, more risktaking, less risk averse." 44
Mission The Group Purpose
Our purpose in Tata is to improve the quality of life in India through leadership in targeted sectors of national economic significance to which the Group can bring a unique set of capabilities. Our past success in delivering such purpose provides the basis for our belief in the future and our role in it. Our Group size and scale will provide management and financial resources to profitably cater to the emerging opportunities and to develop globally competitive skills to succeed in this endeavour. Our long-term success requires us to considerably focus our portfolio, our management efforts and our investment priorities so that Group synergy is brought to bear at the point of delivering value to the customer. The enormous Group resources : in people and finance needs to be re-architectured so that the whole is larger than the sum of its individual parts. Our heritage invokes trust among consumers, employees, shareholders and the community. This is a precious heritage, unique in India, and will not only be preserved, but also enriched by formalising the high standards of behaviour 45
expected from our employees and the companies in the years to come. The Tata name is a unique asset representing Leadership with Trust. Leveraging this asset to unify our companies is the route to long-term success and delivery of returns to the shareholder in excess of the cost of capital. At the Tata Group our purpose is to improve the quality of life of the communities we serve. We do this through leadership in sectors of national economic signifi cance, to which the group brings a unique set of capabilities. This requires us to grow aggressively in focused areas of business.Our heritage of returning to society what we earn evokes trust amongconsumers, employees, shareholders and the community. This heritage will be continuously enriched by formalising the high standards of behaviour expected from employees and companies.The Tata name is a unique asset representing leadership with trust Leveraging this asset to enhance group synergy and becoming globally competitive is the route to sustained growth and long-term success.
HR, Marketing, Finance & Safety Policies
HUMAN RESOURCE POLICY
Tata Steel recognises that its people are the primary source of its competitiveness. It is committed to equal employment opportunities for attracting the best available talent and ensuring a cosmopolitan workforce. It will pursue management practices designed to enrich the quality of life of its employees, develop their potential and maximise their productivity. It will aim at ensuring transparency, fairness and equity in all its dealing with its employees. Tata Steel will strive continuously to foster a climate of openness, mutual trust and teamwork Tata is committed to create an exciting work pace based on self-directed teams ,improvement and innovative work in environment.
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d) Create work conductive to superior performance , which enable employees to realize their full potential through continuous learning and training e) Identify and develop potential leaders for future growth. f) High potential employee working in congenial work environment. Tata Steel recognises that its people are the primary source of its competitiveness. It is committed to equal employment opportunities for attracting the best available talent and ensuring a cosmopolitan workforce. It will pursue management practices designed to enrich the quality of life of its employees, develop their potential and maximise their productivity. It will aim at ensuring transparency, fairness and equity in all its dealing with its employees. Tata Steel will strive continuously to foster a climate of openness, mutual trust and teamwork
Safety Policy
1. A Tata company shall strive to provide a safe, healthy, clean and ergonomic working environment for its people. It shall prevent the wasteful use of natural resources and be committed to improving the environment, particularly with regard to the emission of greenhouse gases, and shall endeavour to offset the effect of climate change in all spheres of its activities. 2. A Tata company, in the process of production and sale of its products and services, shall strive for economic, social and environmental sustainability. o Comply with all applicable legislation, regulations and other requirements.
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o o o o o o
Enhance employee's knowledge, skill and consequent involvement in Environment, Safety, Health and Quality Management Programmes. Make systematic and progressive reduction of losses in operational areas by deploying Total Productive Maintenance. Eliminate, reduce or control hazards/ risks arising out of our operations and products. Preserve and develop environment by reduction in pollution in all its forms and nurture the eco-system within and outside the organisation. Harmonise its economic progress with social and community considerations. The Company will institutionalise Evaluation and Improvement system in business practices to make rapid progress. This policy will be made available to all the interested parties on demand.
Finance Policies
A Tata company shall prepare and maintain its accounts fairly and accurately and in accordance with the accounting and financial reporting standards which represent the generally accepted guidelines, principles, standards, laws and regulations of the country in which the company conducts its business affairs. Internal accounting and audit procedures shall reflect, fairly and accurately, all of the 48
company’s business transactions and disposition of assets, and shall have internal controls to provide assurance to the company’s board and shareholders that the transactions are accurate and legitimate. All required information shall be accessible to company auditors and other authorised parties and government agencies. There shall be no willful omissions of any company transactions from the books and records, no advance-income recognition and no hidden bank account and funds. Any willful, material misrepresentation of and / or misinformation on the financial accounts and reports shall be regarded as a violation of the Code, apart from inviting appropriate civil or criminal action under the relevant laws. No employee shall make, authorise, abet or collude in an improper payment, unlawful commission or bribing.
Market Policies A Tata company shall fully support the development and operation of competitive open markets and shall promote the liberalisation of trade and investment in each country and market in which it operates. Specifically, no Tata company or employee shall engage in restrictive trade practices, abuse of market dominance or similar unfair trade activities. A Tata company or employee shall market the company’s products and services on their own merits and shall not make unfair and misleading statements about competitors’ products and services. Any collection of competitive information shall be made only in the normal course of business and shall be obtained only through legally permitted sources and means.
Outlook 49
Group chairman Ratan Tata speaker on a wide range of issue concerning the Tata Group and its pace in a world changing dramatically than ever before what will be the nature ad scope of Tata Group engagement in the coming years with a world changing more rapidly than ever before. Here are numerous questions and who better to address and opportunities before the group as it continuous reinforcing and reinventing itself in India and in the world. Over the next five to seven years the group has to start looking seriously and strategically at creating brand awareness for ourselves in new business commercially and strategically in this region’s the group also says that in commodities the brand is not as important as it is in product. The group chairman Ratan Tata says that we are not promoting our one brand but we are getting serious of properties that have their one brand it can also happen with a company like Titan if you are willing to spend huge amount of money propagating the brand it will work.
S&P keeps negative outlook for Tata Motors Mumbai, July 9 Standard & Poor’s Ratings Services said today it kept its ‘BB’ corporate credit rating on Tata Motors on CreditWatch with negative implications, pending finalisation of the long-term financing plans for funding the company’s purchase of Jaguar and Land Rover from Ford. At the same time, Standard & Poor’s ratings on all Tata Motors’ rated debt remain on CreditWatch with negative implications. The rating on Tata Motors was lowered on April 4, 2008, to ‘BB’, from ‘BB+’, after the announcement of the agreement with Ford Motor Co for the purchase of Jaguar and Land Rover. Tata Motors has paid about $2.3 billion in cash for Jaguar and Land Rover (comprising brands, plants, and intellectual property rights).
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Ford has contributed $600 million to the Jaguar-Land Rover (JLR) pension plans. “To fund the initial transaction, Tata Motors raised short-term bridge facilities of $3 billion, which it plans to repay through a mix of fresh equity infusion, liquidation of investments, and long-term debt,” said Standard & Poor’s credit analyst Mr Anshukant Taneja. The company has obtained a board approval to raise up to $1.05 billion through a rights issue of equity shares, up to $750 million of optionally convertible preference shares, and $500 million-$600 million through a separate issuance of securities in overseas markets.
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Corporate Governance Tata Code of Conduct This comprehensive document serves as the ethical road map for Tata employees and companies, and provides the guidelines by which the Group conducts its businesses. Clause:1 National interest The Tata Group is committed to benefit the economic development of the countries in which it operates. No Tata company shall undertake any project or activity to the detriment of the wider interests of the communities in which it operates.
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A Tata company’s management practices and business conduct shall benefit the country, localities and communities in which it operates, to the extent possible and affordable, and shall be in accordance with the laws of the land. A Tata company, in the course of its business activities, shall respect the culture, customs and traditions of each country and region in which it operates. It shall conform to trade procedures, including licensing, documentation and other necessary formalities, as applicable. Clause:2 Financial reporting and records A Tata company shall prepare and maintain its accounts fairly and accurately and in accordance with the accounting and financial reporting standards which represent the generally accepted guidelines, principles, standards, laws and regulations of the country in which the company conducts its business affairs. Internal accounting and audit procedures shall reflect, fairly and accurately, all of the company’s business transactions and disposition of assets, and shall have internal controls to provide assurance to the company’s board and shareholders that the transactions are accurate and legitimate. All required information shall be accessible to company auditors and other authorised parties and government
agencies. There shall be no willful omissions of any company transactions from the books and records, no advance-income recognition and no hidden bank account and funds. Any willful, material misrepresentation of and / or misinformation on the financial accounts and reports shall be regarded as a violation of the Code, apart from inviting appropriate civil or criminal action under the relevant laws. No employee shall make, authorise, abet or collude in an improper payment, unlawful commission or bribing. Clause:3 Competition A Tata company shall fully support the development and operation of competitive 53
open markets and shall promote the liberalisation of trade and investment in each country and market in which it operates. Specifically, no Tata company or employee shall engage in restrictive trade practices, abuse of market dominance or similar unfair trade activities. A Tata company or employee shall market the company’s products and services on their own merits and shall not make unfair and misleading statements about competitors’ products and services. Any collection of competitive information shall be made only in the normal course of business and shall be obtained only through legally permitted sources and means Clause:4 Equal opportunities employer A Tata company shall provide equal opportunities to all its employees and all qualified applicants for employment without regard to their race, caste, religion, colour, ancestry, marital status, gender, sexual orientation, age, nationality, ethnic origin or disability. Human resource policies shall promote diversity and equality in the workplace, as well as compliance with all local labour laws, while encouraging the adoption of international best practices.
Employees of a Tata company shall be treated with dignity and in accordance with the Tata policy of maintaining a work environment free of all forms of harassment, whether physical, verbal or psychological. Employee policies and practices shall be administered in a manner consistent with applicable laws and other provisions of this Code, respect for the right to privacy and the right to be heard, and that in all matters equal opportunity is provided to those eligible and decisions are based on merit. Clause:5 Gifts and donations A Tata company and its employees shall neither receive nor offer or make, directly or indirectly, any illegal payments, remuneration, gifts, donations or comparable benefits that are intended, or perceived, to obtain uncompetitive favours for the
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conduct of its business. The company shall cooperate with governmental authorities in efforts to eliminate all forms of bribery, fraud and corruption. However, a Tata company and its employees may, with full disclosure, accept and offer nominal gifts, provided such gifts are customarily given and are of a commemorative nature. Each company shall have a policy to clarify its rules and regulations on gifts and entertainment, to be used for the guidance of its employees. Clause:6 Government agencies A Tata company and its employees shall not, unless mandated under applicable laws, offer or give any company funds or property as donation to any government agency or its representative, directly or through intermediaries, in order to obtain any favourable performance of official duties. A Tata company shall comply with government procurement regulations and shall be transparent in all its dealings with government agencies.
Clause:7 Political non-alignment A Tata company shall be committed to and support the constitution and governance systems of the country in which it operates. A Tata company shall not support any specific political party or candidate for political office. The company’s conduct shall preclude any activity that could be interpreted as mutual dependence / favour with any political body or person, and shall not offer or give any company funds or property as donations to any political party, candidate or campaign. 55
Clause:8 Health, safety and environment A Tata company shall strive to provide a safe, healthy, clean and ergonomic working environment for its people. It shall prevent the wasteful use of natural resources and be committed to improving the environment, particularly with regard to the emission of greenhouse gases, and shall endeavour to offset the effect of climate change in all spheres of its activities. A Tata company, in the process of production and sale of its products and services, shall strive for economic, social and environmental sustainability. Clause:9 Quality of products and services A Tata company shall be committed to supply goods and services of world class quality standards, backed by after-sales services consistent with the requirements of its customers, while striving for their total satisfaction. The quality standards of the company’s goods and services shall meet applicable national and international standards. A Tata company shall display adequate health and safety labels, caveats and other necessary information on its product packaging.
Clause:10 Corporate citizenship A Tata company shall be committed to good corporate citizenship, not only in the compliance of all relevant laws and regulations but also by actively assisting in the improvement of quality of life of the people in the communities in which it operates. The company shall encourage volunteering by its employees and collaboration with community groups. Tata companies are also encouraged to develop systematic processes and conduct management reviews, as stated in the Tata ‘corporate sustainability protocol’, from time to time so as to set strategic direction for social development activity. 56
The company shall not treat these activities as optional, but should strive to incorporate them as an integral part of its business plan. Clause:11 Cooperation of Tata companies A Tata company shall cooperate with other Tata companies including applicable joint ventures, by sharing knowledge and physical, human and management resources, and by making efforts to resolve disputes amicably, as long as this does not adversely affect its business interests and shareholder value. In the procurement of products and services, a Tata company shall give preference to other Tata companies, as long as they can provide these on competitive terms relative to third parties. Clause:12 Public representation of the company and the Group The Tata Group honours the information requirements of the public and its stakeholders. In all its public appearances, with respect to disclosing company and business information to public constituencies such as the media, the financial community, employees, shareholders, agents, franchisees, dealers, distributors and importers, a Tata company or the Tata Group shall be represented only by specifically authorised directors and employees. It shall be the sole responsibility of these authorised representatives to disclose information about the company or the Group.
Clause:13 Third party representation Parties which have business dealings with the Tata Group but are not members of the Group, such as consultants, agents, sales representatives, distributors, channel partners, contractors and suppliers, shall not be authorised to represent a Tata company without the written permission of the Tata company, and / or if their business conduct and ethics are known to be inconsistent with the Code. Third parties and their employees are expected to abide by the Code in their interaction with, and on behalf of, a Tata company. Tata companies are encouraged
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to sign a non-disclosure agreement with third parties to support confidentiality of information. Clause:14 Use of the Tata brand The use of the Tata name and trademark shall be governed by manuals, codes and agreements to be issued by Tata Sons. The use of the Tata brand is defined in and regulated by the Tata Brand Equity and Business Promotion Agreement. No third party or joint venture shall use the Tata brand to further its interests without specific authorisation. Clause:15 Group policies A Tata company shall recommend to its board of directors the adoption of policies and guidelines periodically formulated by Tata Sons. Clause:16 Shareholders A Tata company shall be committed to enhancing shareholder value and complying with all regulations and laws that govern shareholder rights. The board of directors of a Tata company shall duly and fairly inform its shareholders about all relevant aspects of the company’s business, and disclose such information in accordance with relevant regulations and agreements.
Clause:17 Ethical conduct Every employee of a Tata company, including full-time directors and the chief executive, shall exhibit culturally appropriate deportment in the countries they operate in, and deal on behalf of the company with professionalism, honesty and integrity, while conforming to high moral and ethical standards. Such conduct shall be fair and transparent and be perceived to be so by third parties.
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Every employee of a Tata company shall preserve the human rights of every individual and the community, and shall strive to honour commitments. Every employee shall be responsible for the implementation of and compliance with the Code in his / her environment. Failure to adhere to the Code could attract severe consequences, including termination of employment. Clause:18 Regulatory compliance Employees of a Tata company, in their business conduct, shall comply with all applicable laws and regulations, in letter and spirit, in all the territories in which they operate. If the ethical and professional standards of applicable laws and regulations are below that of the Code, then the standards of the Code shall prevail. Clause:19 Concurrent employment Consistent with applicable laws, an employee of a Tata company shall not, without the requisite, officially written approval of the company, accept employment or a position of responsibility (such as a consultant or a director) with any other company, nor provide freelance services to anyone, with or without remuneration. In the case of a full-time director or the chief executive, such approval must be obtained from the board of directors of the company.
Clause:20 Conflict of interest An employee or director of a Tata company shall always act in the interest of the company, and ensure that any business or personal association which he / she may have does not involve a conflict of interest with the operations of the company and his / her role therein.
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Independent directors of a Tata company shall comply with applicable laws and regulations of all the relevant regulatory and other authorities. As good governance practice they shall safeguard the confidentiality of all information received by them by virtue of their position, but they need not be bound by all other conflicts that are applicable to employees or executive directors, as indicated below. An employee, including the executive director (other than independent director) of a Tata company, shall not accept a position of responsibility in any other non-Tata company or not-for-profit organisation without specific sanction. The above shall not apply to (whether for remuneration or otherwise): a) Nominations to the boards of Tata companies, joint ventures or associate companies. b) Memberships / positions of responsibility in educational / professional bodies, wherein such association will benefit the employee / Tata company. c) Nominations / memberships in government committees / bodies or organisations. d) Exceptional circumstances, as determined by the competent authority. Competent authority, in the case of all employees, shall be the chief executive, who in turn shall report such exceptional cases to the board of directors on a quarterly basis. In case of the chief executive and executive directors, the Group Corporate Centre shall be the competent authority.
An employee or a director of a Tata company shall not engage in any business, relationship or activity which might conflict with the interest of his / her company or the Tata Group. A conflict of interest, actual or potential, may arise where, directly or indirectly… a) An employee of a Tata company engages in a business, relationship or activity with anyone who is party to a transaction with his / her company.
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b) An employee is in a position to derive an improper benefit, personally or to any of his / her relatives, by making or influencing decisions relating to any transaction. c) An independent judgement of the company’s or Group’s best interest cannot be exercised. The main areas of such actual or potential conflicts of interest shall include the following: a) An employee or a full-time director of a Tata company conducting business on behalf of his / her company or being in a position to influence a decision with regard to his / her company’s business with a supplier or customer where his / her relative is a principal officer or representative, resulting in a benefit to him / her or his / her relative. b) Award of benefits such as increase in salary or other remuneration, posting, promotion or recruitment of a relative of an employee of a Tata company, where such an individual is in a position to influence decisions with regard to such benefits. c) The interest of the company or the Group can be compromised or defeated. Notwithstanding such or any other instance of conflict of interest that exist due to historical reasons, adequate and full disclosure by interested employees shall be made to the company’s management. It is also incumbent upon every employee to make a full disclosure of any interest which the employee or the employee’s immediate family, including parents, spouse and children, may have in a family
business or a company or firm that is a competitor, supplier, customer or distributor of or has other business dealings with his / her company. Upon a decision being taken in the matter, the employee concerned shall be required to take necessary action, as advised, to resolve / avoid the conflict. If an employee fails to make the required disclosure and the management of its own accord becomes aware of an instance of conflict of interest that ought to have been disclosed by the employee, the management shall take a serious view of the matter and consider suitable disciplinary action against the employee. 61
Clause:21 Securities transactions and confidential information An employee of a Tata company and his / her immediate family shall not derive any benefit or counsel, or assist others to derive any benefit, from access to and possession of information about the company or Group or its clients or suppliers that is not in the public domain and, thus, constitutes unpublished, price-sensitive insider information. An employee of a Tata company shall not use or proliferate information that is not available to the investing public, and which therefore constitutes insider information, for making or giving advice on investment decisions about the securities of the respective Tata company, Group, client or supplier on which such insider information has been obtained. Such insider information might include (without limitation) the following: • • • • • • • •
Acquisition and divestiture of businesses or business units. Financial information such as profits, earnings and dividends. Announcement of new product introductions or developments. Asset revaluations. Investment decisions / plans. Restructuring plans. Major supply and delivery agreements. Raising of finances.
An employee of a Tata company shall also respect and observe the confidentiality of information pertaining to other companies, their patents, intellectual property rights, trademarks and inventions; and strictly observe a practice of non-disclosure. Clause:22 Protecting company assets The assets of a Tata company shall not be misused; they shall be employed primarily and judiciously for the purpose of conducting the business for which they 62
are duly authorised. These include tangible assets such as equipment and machinery, systems, facilities, materials and resources, as well as intangible assets such as information technology and systems, proprietary information, intellectual property, and relationships with customers and suppliers. Clause:23 Citizenship The involvement of a Tata employee in civic or public affairs shall be with express approval from the chief executive of his / her company, subject to this involvement having no adverse impact on the business affairs of the company or the Tata Group. Clause:24 Integrity of data furnished Every employee of a Tata company shall ensure, at all times, the integrity of data or information furnished by him/her to the company. He/she shall be entirely responsible in ensuring that the confidentiality of all data is retained and in no circumstance transferred to any outside person/party in the course of normal operations without express guidelines from or, the approval of the management. Clause:25 Reporting concerns Every employee of a Tata company shall promptly report to the management, and / or third-party ethics helpline, when she / he becomes aware of any actual or possible violation of the Code or an event of misconduct, act of misdemeanour or act not in the company’s interest. Such reporting shall be made available to suppliers and partners, too.
Any Tata employee can choose to make a protected disclosure under the whistleblower policy of the company, providing for reporting to the chairperson of the audit committee or the board of directors or specified authority. Such a protected disclosure shall be forwarded, when there is reasonable evidence to conclude that a violation is possible or has taken place, with a covering letter, which shall bear the identity of the whistleblower. 63
The company shall ensure protection to the whistleblower and any attempts to intimidate him / her would be treated as a violation of the Code.
Articles on governance The covenant and the code Long before corporate governance became a buzzword in industry circles, Tata Steel was following the letter and spirit of the rules that define ethical business behaviour Companies learned long back that having the complete cooperation and participation of their employees meant improved efficiencies and, consequently, superior products. Now they have begun understanding that a strong commitment from investors and other stakeholders can lead to similar payoffs for the organisation. Both are elements of a corporate governance template which demands that broad-based systems of accountability be built into the spinal structures of companies. Government regulations can be a guide, at best, in this process. More important is a culture of self-policing. Tata Steel has imbibed this culture better than most. Much before the business world woke up to the importance of evolving a 'method' for corporate governance, Tata Steel had already been practising its substance. It is no surprise, therefore, that the ministry of finance, Government of India, awarded the company the national award for excellence in corporate governance in 2000. Two years later Tata Steel bagged the golden peacock award for excellence in corporate governance and corporate social responsibility from the Institute of Directors, an apex association of company directors.
Deputy managing director AN Singh defines the Tata Steel approach thus: "Corporate governance is the ethical and responsible behaviour of a corporation towards its owners, its shareholders, but it has a fallout effect on other constituents too." Tata Steel has engaged all its stakeholders — a broad category that includes employees, regulators, the communities in and around the areas where it operates, and shareholders — at every stage of its evolution. The shareholders, though they are the farthest away and the most fragmented, remain at the heart of the company. 64
"We have to ensure a transparent and fair administration so that the money the shareholders put in is safe and productive," says Mr Singh. To ensure this Tata Steel has a three-pronged governance structure that provides for checks and balances throughout its operation. The first layer of this structure is the law of the land. Statutes on the number of non-executive and independent directors, board procedure, and terms of office are followed with rigour. Tata Steel's balance sheet is certified as fair and true by its chief executive officer and its chief finance officer, and the company also submits a report on various corporate governance parameters. It has mandated committees for audit, remuneration for directors and investor grievances. Tata Steel's investor grievance committee, which looks into complaints about transfer of shares, receipt of balance sheet and dividends, meets twice or thrice a year and checks if all issues have been resolved satisfactorily. The second tier of Tata Steel's corporate governance edifice is based on the Tata code of conduct, a comprehensive set of tenets that all Tata employees have to adhere to. The code goes way beyond government-mandated regulations. For example, the offices of non-executive chairman and managing director are separated in Tata companies, even though the law does not require this. The Tata code explicitly prohibits insider trading and sets out disclosure practices that help shareholders take informed decisions. This ensures that the interests of shareholders are put above all else and that people inside the company conduct their personal securities transactions in an ethical manner. Tata Steel has an ethics and compliance committee, as stipulated by the code, and this comprises, among other things, labour welfare measures like the eight-hour working day, leave with pay, provident fund, gratuity and profit sharing.
The rules implicit in Tata Steel's proactive workday ethos have been around for many years. The company never meddles in the share market. It invites a social audit every 10 years, in which an independent authority checks if it has functioned responsibly and ethically with all its stakeholders. Tata Steel recently adopted the Social Accountability (SA) 8000 standard, which promotes responsible behaviour towards labour supplied by its contractors. It has also set up apex committees for 65
management, business excellence, safety, research and development, information technology, etc. To ensure that a culture of self-motivated ethics percolates to the rank and file, Tata Steel lays plenty of emphasis on communication, the third layer of its corporate governance structure. The office of the ethics counsellor executes this vision. Says ethics counsellor Rekha Seal, "We manage with trust. We start with the given that everyone is honest, but if we find that someone has flouted rules we take decisive and immediate action. This is important because trust is the foundation of our name and our brand."
TRUST
A tradition of trust The Tata trusts are the unsung heroes of an extraordinary saga of philanthropy that has enriched India and its citizens in myriad ways
You may wonder why the Tatas — among the country's biggest and most illustrious industrial families for well over a century — never show up on any of those ritual listings of India's richest people. The reason is as simple as it is remarkable. Over generations, the Tatas have sustained a tradition of bequeathing much of their personal wealth to the many trusts they have created for the greater good of India and its people
That is how the Tata trusts have come to control 65.8 per cent of the shares of Tata Sons, the holding company of the group. The wealth that accrues from this asset supports an assortment of causes, institutions and individuals in a wide variety of areas. The trusteeship principle governing the way the group functions casts the Tatas in a rather unique light: capitalistic by definition but socialistic by character. 66
Support for higher studies This was the sentiment that led Jamsetji Tata to establish the JN Tata Endowment Scheme for higher education in 1892. The scheme helped bright Indian students of moderate means become administrators, scientists, doctors, lawyers and engineers, funding their education through loans and grants. The maiden grant was to Dr Freney Cama, who became one of the first women gynaecologists in India and who would come to have a maternity hospital in Mumbai named after her. Of the 37 beneficiaries in the first batch, as many as 15 joined the Indian Civil Service, the colonial version of the Indian Administrative Service, realising Jamsetji Tata's objective that Indians should learn how to govern themselves. By 1924, over a third of Indian ICS officers were Tata scholars. Illustrious JN Tata Endowment scholars include former president KR Narayanan, renowned scientists Raja Ramanna, Jayant Narlikar and Raghunath Mashelkar, and Gyanpeeth awardwinning writer and actor Girish Karnad. The Endowment has thus far supported more than 3,500 scholars. Their father’s sons Jamsetji Tata's idea of philanthropy was to be given true expression by his sons, Sir Dorab Tata and Sir Ratan Tata, both of whom donated the major chunk of their personal wealth for the public good. Sir Dorab was the quintessential entrepreneur, working tirelessly to make his father's visionary ideas a reality — roaming the jungles of what is now Jharkhand in eastern India in a bullock cart to set up Tata Steel and pioneering the generation of hydroelectric power in the wilds of the Western Ghats — while Sir Ratan was a connoisseur of the arts and a passionate votary of social development.
A funding agency How do the trusts operate? Says Shernaz Vasunia, programme officer of the Sir Dorabji Tata Trust: "Over 75 per cent of our trust's funds come from dividends on the shares it owns in Tata Sons, the Group's holding company. The remaining comes from their own statutory investments." Adds Sarosh N. Batliwala, who heads the Sir Dorabji Tata Trust: "Our trusts don't handle corporate social 67
responsibility; they are more of a funding agency, like the Ford Foundation." The Sir Dorabji Tata supports different kinds of NGOs — some do social work, some research, while others are community based — usually for a period of three to five years. It also works with international agencies such as the United Nations, mostly in times of natural disasters. From time to time the Sir Dorabji Tata Trust also initiates the process for establishing institutes of national importance.
JN Tata Endowment The JN Tata Endowment was set up in 1892 by the founder of the Tata Group, Jamsetji Tata, to encourage young people to take up higher studies at some of the best universities in the world. It is the first Tata benefaction in the field of education, and possibly the first of its kind in Asia. The endowment awards only loan scholarships. However, the selected scholars may also qualify for a gift award. The amount to be awarded to each scholar by way of loan and gift scholarship is determined on the basis of norms laid down for the purpose, and does not cover the full cost of studies. Scholarships are granted for higher studies in all disciplines and subjects
Eligibility criteria • •
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Applicants should be Indian nationals and graduates of a recognised Indian university with a consistently good academic record. Students in the final year of a degree course and those awaiting results can also apply.
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Other mid-career professionals planning to go abroad for further research, specialisation or training are eligible to apply. At the time of submitting the completed applications, candidates need not have the admission / offer letters from the universities to which they have applied for the relevant academic year.
Selection process After the initial screening of applications, candidates are shortlisted for an interview in person by subject experts. The final selection is on the basis of interviews that are held in Mumbai, generally between March and June every year.
Sir Ratan Tata Trust The Sir Ratan Tata Trust is one of India's oldest grant-bestowing foundations. It was established in 1918 following the death of Sir Ratan Tata, the younger son of Group founder Jamsetji Tata, and it operates in accordance with his will. Sir Ratan wanted to establish a trust that would help further "the advancement of education, learning and industry in all its branches. Institutional grants • • •
Programme grants: These cover rural livelihoods and communities, education, health, art and culture, and civil society and governance. Endowment grants: The trust supports institutions that work within the thematic areas that it focuses on. Small grants: This caters to the needs of small, welfare-oriented organisations, and those needing support to implement innovative ideas.
Sir Dorabji Tata and allied trusts The Sir Dorabji Tata Trust was established in 1932 by Sir Dorab Tata, the elder son of Group founder Jamsetji Tata, and is one of the oldest philanthropic organisations in India. The Trust's vision of constructive philanthropy has been
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sensitive to the fast-growing needs of a developing nation, and the projects and programmes it supports bear contemporary relevance Endowment grants The Trust has promoted, and continued to support, several institutions of learning, research and culture in India. These include the Tata Institute of Social Sciences, Mumbai, the Tata Memorial Centre for Cancer Research and Treatment, Mumbai, the Tata Institute of Fundamental Research, Mumbai, the Tata Agricultural and Rural Training Centre for the Blind, Phansa, and the National Centre for the Performing Arts, Mumbai. NGO grants The Trust makes grants to NGOs in five social development sectors: •
•
•
•
•
Management of natural resources: The Trust supports projects related to water and water resources, land degradation and better methods of cultivating and harvesting crops. Livelihoods: The Trust has backed several projects in this sector, covering unorganised labourers, capacity building of grassroots groups, and business development of a variety of people-based organisations. Education: The Trust has supported initiatives in the field of education, focusing on children, adolescents and adults (within and outside the formal education system). Health: The Trust has made contributions in creating and upgrading medical infrastructure and healthcare facilities across India, while focusing on training community health workers. The Trust also supports research studies in alternative systems of medicine such as ayurveda. Social development initiatives: These cover many areas, including community development, human rights, family welfare, civil society, art and culture, and relief work.
Individual grants The Trust gives merit and need-based educational and medical grants to individuals. 70
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Medical: Financial help is extended to individuals for the treatment of diseases and to solve other health problems. Education: The Trust offers scholarships for higher education and travel grants for studying abroad and for attending conferences, as well as for sports activities.
The Allied Trusts The Allied Trusts are, primarily, smaller trusts; while some have a specific mandate, the rest are broad-based in their approach to grant-making. The Sir Dorabji Tata Trust administers the Allied Trusts. JN Tata Endowment: The first of the Tata trusts, it was established by Group founder Jamsetji Tata, in 1892 to provide scholarship loans to individuals for the pursuit of higher studies abroad. Over 120 students are selected every year from across India as JN Tata scholars.
INSTITUTE
IISc has produced Nobel laureates, trained many of India's greatest scientists and helped nurture some of the country's finest scientific institutions. Housed in a 37571
acre campus in Bangalore, this trailblazing institution has 40 departments and centres pursuing R&D and teaching in all departments of science, engineering and technology. JRD Tata Ecotechnology Centre: The flag bearer of the ecotechnology movement in India, JRDTEC is part of the MS Swaminathan Research Foundation, Chennai. Established in 1996, it is devoted to seeding and encouraging sustainable development, one that protects the environment while also benefiting the people who depend on it. Tata Institute of Fundamental Research: The need to improve India's scientific temper and strengthen the nation's science infrastructure were the objectives that drove scientist Homi J Bhabha and JRD Tata, the late chairman of the Tata Group, to pursue their vision of establishing TIFR in Bombay back in 1945. Tata Institute of Social Sciences: Set up in 1936, TISS is a pioneer in the field of social-work education in the Asia-Pacific region. The Institute, which offers postgraduate and doctoral programmes, has made significant contributions in the domains of social policy and planning, intervention strategies and human resource development. Tata Memorial Centre: TMC is India's best-known cancer hospital and research centre. This global centre of excellence, where 70 per cent of patients get free primary care, was established in Bombay in 1941, a time when there were only a handful of such institutions in the world. It has added significantly to its capacity and capabilities since then.
Tata Medical Centre: To be commisioned in 2009, Tata Medical Centre in Kolkata, in eastern India, is being equipped with the most contemporary and state-of-the-art medical equipment and will be one of the leading cancer care and research institutions in the country 72
JRD Tata Ecotechnology Centre MS Swaminathan Research Foundation The flag bearer of the ecotechnology movement in India is the JRD Tata Ecotechnology Centre, which is part of the MS Swaminathan Research Foundation, Chennai. Established in 1996, the Centre was born of renowned agricultural scientist Mr Swaminathan's conviction that an optimum blending of traditional wisdom and scientific endeavour that nurtures and protects the environment is the bedrock of truly sustainable development. Dr Swaminathan, winner of the 'world food prize' back in 1987,set aside the money he received from the award for the Centre. A greater monetary contribution came from the Sir Dorabji Tata and Allied Trusts, which initially bestowed Rs1.85 crore to the Centre. Formally inaugurated in July 1998, the institution has received more than Rs4.5 crore from the Tata trusts thus far. This is the kind of backing that has enabled it to play a role in transforming the lives of the rural poor in Tamil Nadu and elsewhere. The JRD Centre's holistic vision for rural development stretches way beyond farming. That means literacy programmes that use computers and touch-screen technology, interaction and advocacy with the government, educating the poor about the schemes the state administration has for them, and helping establish village knowledge centres, where the poor can source information on agriculture, health, animal husbandry, horticulture, government programmes and subsidies, etc.
This all-encompassing approach is part of the sustainable development course that the Centre's parent body, the Swaminathan Foundation, has charted. "The village communities we work with are our partners in research, not just users of our knowledge. We learn from them and they from us," says K Balasubramanian, the 73
director of the JRD Centre. "Time and labour are the only assets the poor have. Our endeavour is to provide them with skills that can be linked to these assets." There's no fixed bouquet of projects and no set sequence of initiatives that the JRD Centre carries to every new place it gets involved with. So it could be micro-credit organisations in one village, self-help groups in another and literacy projects or sustainable farming in a third. But there are three essentials to the JRD Centre's approach: creating grassroots institutions that can respond to any problem; building capabilities, so that people can understand where solutions are available; and helping start micro-credit associations and micro enterprises that deliver livelihood opportunities. There are six phases in the JRD Centre's matrix of sustainable development: mobilisation, organisation, technology transfer, systems management, capacity building and withdrawal. The last of these is critical. The Centre's objective is to make itself redundant, so to speak, over a period of time to the people who benefit from its expertise. This is a consistent theme with the Centre, and it's a huge bonus for the organisation and, more importantly, the villages it works with. "The famine of work causes the famine of food," says Mr Swaminathan, the patriarch whose vision shaped the centre. "Today's world is in need of a message of hope. What we need is an ecology of hope: not a 'doom ecology', but a 'do ecology'. This is where the new movement for eco-enterprises and ecotechnology has become a very powerful instrument."
Tata Institute of Social Sciences An American missionary, Clifford Manshardt, pioneered several urban community programmes in the chawls of Bombay near Nagpada in the 1920s. His initiatives where supported by Sir Dorabji Tata. It was during this time that the idea of an 74
institute for social work took root. In 1936, the Dorabji Tata Graduate School of Social Work was established for professional training in social work, in the premises of the Nagpada Neighbourhood House. Dr Manshardt was its first director. Though it was a diploma course, in the first year itself there were 400 applicants for 20 seats on offer. In 1944, it was renamed the Tata Institute of Social Sciences (TISS). Between 1936 and 1948, the School successfully worked to influence national laws and policies. "We pioneered programmes which were later enacted into laws by the Indian government, says TISS's present director, RR Singh, about the history of the Institute. "Our labour welfare and industrial management course was formulated because we believed labour problems needed attention. In 1948, the Labour Act was introduced. The concept of labour welfare in India directly evolved from the work of the Dorabji Tata Graduate School. It helped that these concepts were already part of the Tata culture." The present campus of the Institute, at Deonar in Mumbai, was opened on October 6, 1954, by the then prime minister, Jawaharlal Nehru. The year 1964 is an important landmark in the history of the Institute — it was recognised as a deemed university by the University Grants Commission (UGC). Since then the Institute has expanded continuously, both in educational programmes and infrastructure. It has responded to the changing needs of the social and educational system in the country and has gone far beyond its initial concern of social work education. What started as a small institution offering post-graduate diplomas in social work has grown into a university with diversified activities.
Today TISS is one of India's premier educational institutions. It trains professionals in human resources and social work, carries out research on social problems and social sciences, as well as publishes and disseminates this 75
information for the benefit of society. It is also one of the few institutions in the country which undertakes field projects to demonstrate the workings of organised and systematic welfare measures. "We have never believed in pure classroom instruction," says Dr Singh. "Apart from teaching and training, the faculty participates in field-action projects. Over time we have formed units for research into child welfare and the sociology of education and urbanisation, among other subjects. The social justice budget and report was prepared with our help. This is a first for the state of Maharashtra and a great challenge for us." The problems faced by Dr Manshardt in Nagpada exist even today. Maintaining relevance, explains Dr Singh, is a continuous process, and is played out in the mindset and thinking. To keep up with the changing social fabric, the departments are constantly adding new thrust areas like sustainable rural development and education. The Institute has published over 500 research reports and has initiated 32 field action projects, with the Sir Dorabji Tata Trust supporting a few. "Our link with the Trust continues even today," says Dr Singh. Though it is a deemed university, the representative of the Trust is still the chairman of the governing board. JRD Tata himself headed the board for a number of years. Like Jamsetji Tata, he too believed that wealth must be ploughed back for regeneration of society. The Tatas have financially supported the institute with critical grants for the building and the rural campus. Located 500 km from Mumbai (near Solapur in Maharashtra), the rural campus is in a chronically drought prone area. A parched hillock has been successfully greened, and various other projects are taking shape here.
On the cards are centres for developmental studies, disaster management, domestic violence and human rights. At the moment, small projects are under way in these 76
areas. The Institute is also facilitating the setting up of similar units in other parts of the country. It is holding workshops and running programmes to share knowledge with other universities. TISS is contributing towards teaching, training, research, and extending technical support to voluntary organisations, as well as capacity building in educational institutions, including primary education. "The inspiration of Jamsetji, the stewardship of JRD as chairman of the governing board, and the philanthropy of Dorabji constitute a confluence which has nurtured, supported and strengthened us," says Mr Singh. Fact file The Tata Institute of Social Sciences is a pioneer in the field of social-work education in the Asia-Pacific region. It has made a significant contribution in the area of social policy, planning, intervention strategies and human resource development. The Institute offers postgraduate and doctoral programmes in social sciences, personnel management, industrial relations and health, hospital management, and social work It has nine teaching departments, eight research units, two resource units and resource cells.
An American missionary, Clifford Manshardt, pioneered several urban community programmes in the chawls of Bombay near Nagpada in the 1920s. His initiatives where supported by Sir Dorabji Tata. It was during this time that the idea of an 77
institute for social work took root. In 1936, the Dorabji Tata Graduate School of Social Work was established for professional training in social work, in the premises of the Nagpada Neighbourhood House. Dr Manshardt was its first director. Though it was a diploma course, in the first year itself there were 400 applicants for 20 seats on offer. In 1944, it was renamed the Tata Institute of Social Sciences (TISS). Between 1936 and 1948, the School successfully worked to influence national laws and policies. "We pioneered programmes which were later enacted into laws by the Indian government, says TISS's present director, RR Singh, about the history of the Institute. "Our labour welfare and industrial management course was formulated because we believed labour problems needed attention. In 1948, the Labour Act was introduced. The concept of labour welfare in India directly evolved from the work of the Dorabji Tata Graduate School. It helped that these concepts were already part of the Tata culture." The present campus of the Institute, at Deonar in Mumbai, was opened on October 6, 1954, by the then prime minister, Jawaharlal Nehru. The year 1964 is an important landmark in the history of the Institute — it was recognised as a deemed university by the University Grants Commission (UGC). Since then the Institute has expanded continuously, both in educational programmes and infrastructure. It has responded to the changing needs of the social and educational system in the country and has gone far beyond its initial concern of social work education. What started as a small institution offering post-graduate diplomas in social work has grown into a university with diversified activities.
Today TISS is one of India's premier educational institutions. It trains professionals in human resources and social work, carries out research on social 78
problems and social sciences, as well as publishes and disseminates this information for the benefit of society. It is also one of the few institutions in the country which undertakes field projects to demonstrate the workings of organised and systematic welfare measures. "We have never believed in pure classroom instruction," says Dr Singh. "Apart from teaching and training, the faculty participates in field-action projects. Over time we have formed units for research into child welfare and the sociology of education and urbanisation, among other subjects. The social justice budget and report was prepared with our help. This is a first for the state of Maharashtra and a great challenge for us." The problems faced by Dr Manshardt in Nagpada exist even today. Maintaining relevance, explains Dr Singh, is a continuous process, and is played out in the mindset and thinking. To keep up with the changing social fabric, the departments are constantly adding new thrust areas like sustainable rural development and education. The Institute has published over 500 research reports and has initiated 32 field action projects, with the Sir Dorabji Tata Trust supporting a few. "Our link with the Trust continues even today," says Dr Singh. Though it is a deemed university, the representative of the Trust is still the chairman of the governing board. JRD Tata himself headed the board for a number of years. Like Jamsetji Tata, he too believed that wealth must be ploughed back for regeneration of society. The Tatas have financially supported the institute with critical grants for the building and the rural campus. Located 500 km from Mumbai (near Solapur in Maharashtra), the rural campus is in a chronically drought prone area. A parched hillock has been successfully greened, and various other projects are taking shape here.
On the cards are centres for developmental studies, disaster management, domestic violence and human rights. At the moment, small projects are under way in these areas. The Institute is also facilitating the setting up of similar units in other parts 79
of the country. It is holding workshops and running programmes to share knowledge with other universities. TISS is contributing towards teaching, training, research, and extending technical support to voluntary organisations, as well as capacity building in educational institutions, including primary education. "The inspiration of Jamsetji, the stewardship of JRD as chairman of the governing board, and the philanthropy of Dorabji constitute a confluence which has nurtured, supported and strengthened us," says Mr Singh. Fact file The Tata Institute of Social Sciences is a pioneer in the field of social-work education in the Asia-Pacific region. It has made a significant contribution in the area of social policy, planning, intervention strategies and human resource development. The Institute offers postgraduate and doctoral programmes in social sciences, personnel management, industrial relations and health, hospital management, and social work It has nine teaching departments, eight research units, two resource units and resource cells.
Tata Memorial Hospital 80
About 10 to 12 million people the world over suffer from cancer. More than 50 per cent of them are from developing countries. In India 800,000 are diagnosed with this dreaded disease every day. At any given time there are 2.5 million cancer patients in the country. If you think this is bad news, there's worse to come. By 2020, the number of patients globally will shoot up to 20 million, and 72 per cent of them will be from the third world. Is India geared for this future? “Not at all,” says Dr Ketayun Dinshaw, director, Tata Memorial Centre (TMC), adding, "we need a Tata Memorial Hospital in every state." She says it was extraordinary vision which made the Tatas set up a speciality cancer centre at a time when there were only a handful of them in the world. Today, TMC treats about one-third of the cancer patients in the country. After Lady Meherbai Tata died of leukaemia in 1932, her husband, Sir Dorabji Tata, wanted to bring to India a facility similar to the ones where his wife was treated abroad. After Dorabji's death, Nowroji Saklatwala, the next chairman of the Tata Group, pursued this dream. But it was the support of JRD Tata that finally saw the Tata Memorial Hospital, a seven-storey structure, opening in Parel, Bombay, on February 28, 1941. In 1957, the Ministry of Health temporarily took over the Tata Memorial Hospital. But JRD Tata and Homi Bhabha — the pioneer of India's nuclear energy programme — had the vision to foresee the role that radiation would play in cancer treatment, from imaging to staging and actual therapy. Administrative control of the hospital was then transferred to the Department of Atomic Energy in 1962. After four years, the Cancer Research Institute — set up in 1952 — and TMC were merged.
Starting as an 80-bed hospital covering an area of 15,000 sq metres, TMC now has more than 440 beds spread over almost 54,000 square metres. The annual budget, Rs500,000 in 1941, is now close to Rs280 million. 81
TMC is a comprehensive centre for the prevention and treatment of cancer, and for research. It is a landmark on the global health map and particularly important to this part of the world. Nearly 25,000 patients visit the clinics each year, not only from all over India but from neighbouring countries as well. About 70 per cent of patients seeking primary care are treated free of charge. Over the years, TMC has also realised the importance of preventive activities and is reaching out to create awareness even in rural areas. The Centre lays a lot of emphasis on education in the field of cancer. Over 150 students, medical professionals, scientists and technicians undergo training at the hospital. The Department of Atomic Energy has established a new state-of-the-art research and development centre at Khargar in Navi Mumbai (called the Advanced Centre for Treatment, Research and Education in Cancer) to focus on research into cancers relevant to India and South Asia. "TMC as well as the Department of Atomic Energy — through its links with the Tata Institute of Fundamental Research and Dr Bhabha — inherit their work culture from the Tatas," says Dr Dinshaw. She recalls how committed JRD was to the institution. "In fact, it was because of his involvement and concern that the hospital was handed over from the Ministry of Health to the Department of Atomic Energy."
Tata Institute of Fundamental Research 82
Homi Bhabha Road Pre-independence India's scientific achievement were far ahead of its industrial successes. This was unusual for any country at that time, but there remained the need to improve India's scientific temper and strengthen the newly free nation's science infrastructure. These were the objectives that drove Homi J Bhabha and JRD Tata to pursue their vision of establishing the Tata Institute of Fundamental Research (TIFR) back in 1945. Mr Bhabha — in the letter he wrote to the Sir Dorabji Tata Trust requesting financial assistance to get the TIFR idea off the ground — talked about "creating a school of physics comparable to the best anywhere in the world." JRD, on the other hand, stressed the "progress" aspect while arguing the case for the institution. These visionaries, working together at a critical time in the nation's history, considered science an integral component to modern India's identity. TIFR became the cradle of the country's atomic energy endeavour. The Institute wasn't just about science; it was also about discovering and delivering the benefits drawn from science to Indian society. Given that there was little scientific and industrial infrastructure at the time, TIFR came to play a crucial role. The building of TIFR was quite interesting. Everything was done in-house, including the carpentry and such. We were at the frontiers of science, which meant that we had to create our own infrastructure. The fundamental research we were involved in then was of the atypical kind. Our early years were marked by this wide vision we had of what research needed to be done. What usually happens when you have so a broad vision is that you compromise on either quality or excellence. But TIFR managed to keep the course it had charted by making excellence intrinsic to its existence. This, to me, is one of the Institute's most remarkable triumphs.
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We have done a large amount of experimental research that has blossomed into trend-setting initiatives. For instance, India's first digital computer was crafted at TIFR, back in 1957. This was a significant success by any yardstick. Today, you hear of technology that's spun off. In my reckoning, TIFR, more than any other Indian institution or industry, has spawned a variety of vital organisations. In the years immediately following independence, India's goal was self-reliance. But, in terms of self-reliance there is a difference between science and technology. If you don't have a particular technology, you can try and develop it to, say, build a car indigenously. The Indica is a fine example of self-reliance. It does not look much different from other cars of its class, but its strength is that it is built indigenously. However, if the Indica had qualities its competitors didn't, then that would make it distinct. To make things indigenously and also make them distinct — that would be an extraordinary combination. In science you cannot stop once you have crossed the indigenous hurdle; you also have to get to a given point before everybody else. Frontier science is about being the discoverer. If someone has discovered something, you cannot go to your lab and rediscover it. Today, India has turned the corner. It is a more confident country and its infrastructure has improved tremendously. Catching up is no longer an achievement; we have to be up there with the best. Therefore, that part of TIFR's original charter — being at the frontiers of science — remains relevant, but being self-reliant and developing infrastructure is secondary. In that sense the continuity of the vision articulated by Mr Bhabha and JRD has been preserved. TIFR now functions differently, and so it must. If it does not it will be frozen in an earlier time, which means it would fail in its mission. Some of our activities have changed down the years and this process will continue as we chart a new course that will, in its details, be somewhat different from the past, but still stay faithful to the original idea.
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We are now trying to set a standard by saying that we are not going to applaud if our people repeat something that somebody else has done. We will only applaud if you are the first one to discover something. Earlier, to be able to produce something was an accomplishment of a kind. That is no longer true. But we had to go through that period to get where we currently are. An excellent institution must be able to rediscover and reinvent itself frequently. And that is one of the strengths of TIFR. The Institute had many successes in the early years of its existence and that, in a way, was a problem. An institution is much more alert if it is in trouble. When an institution is doing well constantly, the high level of confidence generated can sometimes lead to complacency. For TIFR, a successful organisation by any measure, the question now is how to take an outstanding institution and make it truly exceptional. It's a more complicated struggle, requiring a new point of view and a course of action that's consistent with the times we live in. We want to make sure we get the best people. This is a huge challenge because, financially speaking, we cannot provide the kind of salaries that some of our competitors around the world do. But we try to even the playing field as much as possible so that we can compete with the best. Apart from salaries, we provide a work environment that's as good as any other, and in some ways better. Without funding you cannot do research. We have a steady source of funds, but there is a flip side to this equation. Steadfast support can make you complacent, so we have to ensure that support is earned, and not secured just as an entitlement. We receive tremendous backing from the Department of Atomic Energy, which takes an enlightened view of the long-haul factor. We have a beautiful campus and excellent infrastructure, with the finest machines and the latest technology equipment. Our libraries are among the best anywhere and we have good housing facilities.
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Youth is the future, always has been and always will be. Given that reality, we have to understand, hard as it is, that the basic sciences are not an attractive career for today's youngsters. And youth are our lifeblood. If bright young people don't do science, where will our next generation of scientists come from? This is where we now have to concentrate our energies. Earlier, we did not get involved in the education bit; we did not feel the need to. Our education system is not in good shape, particularly in the basic sciences, and — this is my personal opinion — leading institutions such as TIFR have been short sighted in not engaging with this system. It is a crisis that we have brought upon ourselves. University systems are in distress and we need to be involved there. We are making a beginning in this sphere by starting an integrated PhD programme. It's our grand plan, a cradle-to-grave programme for students from 12th class upwards. We have a two-pronged strategy: first comes a 'nurture programme' for young students, followed by an advanced programme for graduates. Generally, our best and brightest students go to institutions such as the IITs, because they think that's the safer, more lucrative option as a career. But a large number of them may continue in basic science if we can compensate by having a first-class education programme. Under the TIFR umbrella, the Homi Bhabha Centre for Science Education is putting in place the nurture programme for engineering students. We also want to capture students who go abroad for their MSc or PhD and take them into our own programmes. We have now become a deemed university and can give them the degrees they seek. To get young people and give them a quality education — that's the top item on my agenda. TIFR has had a good run of more than 50 years, but the times are changing, the economy and society are changing. We have to adapt to this new era and we can do that by incubating our own original ideas. We may have grown a little too big, but in the frontier sciences largeness does not bring quality. We need to ensure that our
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centres have significant autonomy to forge their own destinies. The governing structure set up by the founders, with representatives from the Government of India, the Sir Dorabji Tata Trust and the Government of Maharashtra, is ideal. No one group dominates, which means the Institute can retain its autonomy. Today everybody talks about being global, but TIFR has been global in its outlook since its birth. We have had some significant accomplishments. The GMRT telescope is one of its kind and the best in the world for what it does. Our scientists discovered a new class of superconductors. Many of our students have gone abroad to teach. We've had many distinguished visitors, among them Nobel laureates John Nash and Stephen Hawking. In a sense, we are the bridge between our community and the world. We have to recognise that our original charter requires us to act differently. We have to set the highest standards for accomplishments, not third-world standards but the best global standards. This institute is uniquely placed to do this — and I believe we can do it. Fact file • June 1, 1945: TIFR begins life at the Cosmic Ray Research Unit in Bangalore. Six months later the facilities moved to Bombay (Kenilworth on Peddar Road). • January 15, 1962: Prime Minister Jawaharlal Nehru inaugurates the Institute's new 15-acre campus at Navy Nagar in Bombay. • Initial research was carried out in the areas of cosmic rays, high-energy physics, theoretical physics and mathematics. Later, the Institute expanded its research umbrella to embrace nuclear physics, condensed matter physics, computer science, geophysics, molecular biology, radio astronomy and science education.
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• TIFR's pioneering work led to it designing India's first digital computer (TIFRAC). • TIFR has three schools (School of Mathematics, School of Natural Sciences, School of Technology and Computer Sciences) and as many centres (the Homi Bhabha Centre for Science Education in Mumbai, the National Centre for Radio Astrophysics in Pune, the National Centre for Biological Sciences in Bangalore). • The Institute also runs four facilities: the Giant Meterwave Radio Telescope at Kodad near Pune; the High-Energy Cosmic Ray Laboratory at Udhagamandalam in Tamil Nadu; the High-Energy Cosmic and Gamma Ray Laboratories at Pachamarhi in Madhya Pradesh; and the National Balloon Facility in Hyderabad. Tata Medical Centre (TMC) The Tata Medical Centre (TMC) is a comprehensive cancer hospital and research establishment coming up in Kolkata, India. To be commissioned in 2009, the centre is a philanthropic initiative from the Tata Group for the people of West Bengal and north-eastern states of India. The teams will work with state-of-the-art equipment from the best of manufacturers worldwide. TMC’s mission is to promote prevention, cure, rehabilitation and palliation for cancer patients. It was envisioned to provide a world-class cancer care organisation for the region, especially for the poor. The hospital has 150 beds reserved for the underprivileged and is being provided with the best of medical equipment and personnel. The hospital will have outpatient, inpatient, therapeutic, diagnostic, telemedicine and other services. It will be managed by the Tata Medical Centre Trust (TMCT), Kolkata, which has been formed specifically for this purpose. The need for such a centre is acute, given that India has about 2.5 – 3 million cases of cancer and the
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Tata Memorial Hospital in Mumbai registers nearly a quarter of its cases from the east / north-east regions of India and Bangladesh. Designed by Cannon Design, a renowned architectural firm from North America, the hospital is located at Rajarhat, Kolkata on 13.36 acres of land procured from the West Bengal government and has easy accessibility from the city centre as well as the city airport. Diagnosis and treatment TMC will work with the best professionals and equipment to ensure that its diagnostic and treatment services are comparable with the best in the world. It will set up disease management teams with experts from different streams like surgery, radiation oncology, medical oncology, pathology, radiology, psychiatry, medical social work, etc. This will ensure a multi disciplinary approach towards treatment protocols, medical strategies and guidelines that will reflect a holistic view of the problem and its manifestation. To ensure integrity and complete security of the diagnostic process, patient samples, drugs and consumables will be transported across the hospital through a pneumatic chute system. The hospital will maintain an efficient waste management system. The centre will be monitored by a comprehensive and customised Hospital Management System (HMS), currently under development by the Tata Consultancy Services (TCS). Research and education TMC will collaborate with the best institutes in the world and nurture talent from local universities. It will have a slew of research initiatives, including basic science research, clinical research, intramural research and multi-centric trials. It will also provide education in the field of medicine and allied subjects, with a special focus on oncology.
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The centre will have academic offices, lecture and seminar rooms, a digital library, and access to electronic journals and a networking of libraries. Service delivery TMC's objective is to always provide the best possible services in every area of intervention. Outpatient services The infrastructure at TMC’s outpatient department aims to maximise ambulatory care and minimise the need for hospitalisation. Among the outpatient services envisaged are consultations, diagnostic investigations, day-care surgery, biopsies and stent placements, minimal-access surgery, radiotherapy, chemotherapy and counselling. Diagnostic services These will include laboratory and imaging services. Samples collected will be transported from collection centres in the hospital to laboratories through a pneumatic chute system. The samples will be processed and the results made available on the hospital information system. Among the imaging services provided will be conventional radiography, fluoroscopy, mammography, ultrasonography and different scans. Images will be captured in digital format and with the help of an ‘enterprise picture archival and communication system’. Therapeutic services Among the therapeutic facilities to be made available at TMC will be surgical oncology, major and minor surgical procedures, minimal-access surgery, laser surgery and day surgery. The centre will have an operation theatre complex and a variety of associated facilities. Inpatient services
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The inpatient services will be located in a separate building. The amenities provided will be consistent with the intensity of care and will comprise, among others, a central nursing station and patient rooms and wards. There will also be a high-dependency unit, a bone marrow transplant ward and isolation rooms. Rehabilitation services Among the rehabilitation services to be provided will be physiotherapy, occupational therapy, speech therapy, catheter care and a prosthesis clinic. Prevention and care TMC will provide preventive oncology services to the public by means of dissemination of cancer-related information, screening services, executive health check-up programmes and tobacco cessation initiatives. In addition, the centre will work closely with a network of support organisations and sister institutions to provide complete cancer treatment facilities. The benefits that will accrue as a result of this alliance are: Telemedicine facilities The TMC facility will conduct a telemedicine programme with the Tata Memorial Centre, Mumbai, and a network of other institutions. The main objective here is to exchange expertise in patient care and provide opportunities for experts to share their skills and knowledge. Other benefits would include online training programmes and distance education. Patient rest houses: The hospital is planning to provide low-cost comfortable accommodation, for attendants of out-station in-patients and low dependency outpatients while they undergo treatment. The motel/ lodge will initially accommodate 200 beds. The services include canteen, packed food delivery and self cooking stations, laundry, launderettes, shuttle services to the hospital, prayer/meditation room, children’s play room, etc.
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Human Resource TMC is bringing together a team of dedicated, committed and well trained professionals from all parts of the country and beyond to ensure that the centre is counted among the best in the world. Support services The centre will set up cancer support teams such as medical social work team and the psychiatrists and clinical psychologists group, in collaboration with NGOs and voluntary organisations. Activities include: •
Patient support
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Financial Aid
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Counselling
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Patient navigation
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Helpline
The objective at TMC is to build an organisation that excels in services, education and research in the field of cancer.
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SPORT 'Every sport is worthy of support' The Tata Group’s sporting legacy The Tata Group has been connected with sporting activities since 1920. The group’s interest in sports comes from our founder, Sir Jamsetji Tata. When Jamshedpur was planned (around 1900), he wrote to his sons to ensure that the city had wide streets, lots of trees, and grounds for cricket, hockey and football. He had the vision to realise that sports is an integral part of any city plan. Sir Dorab Tata was a great sportsman. He was a Cambridge blue at cricket and a founding member of the Willingdon Club in Mumbai. He sponsored the Indian contingent for the Antwerp Olympics in 1920 and, as president of the Indian Olympic Council, financed the Indian squad that went to the Paris Olympics in 1924. Sports has always been an integral part of the Tata way of life. We believe in improving the quality of life, and sports is a vital part of life Tata Sports Club The Tata Sports Club was the channel through which sports people found their expression. They needed an organisation through which they could represent their sports (you can’t represent just the Tatas), and the Club provided that avenue. The Club was a group effort involving employees from different companies, and it was supported by people who were either employees or on contract. The Club was Mumbai-centric because most Tata companies had their headquarters here, and JRD — its president for over 50 years — was based here. Jamshedpur had Tata Steel, but Tata Steel players would represent the Club. Tata Steel was and is, in its own rights, a nursery for sports. Whether it be with Bachendri Pal climbing Mount Everest or Premchand Dogra being crowned Mr Universe, Tata Steel has always been a great supporter of sports.
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Beyond cricket The Tata Group has considered every sport as worthy of support; so long as people excelled in a particular field, we supported their talent. Two world billiards champions, Geet Sethi and Michael Ferriera, were Tata employees. If someone is at that level, or has the potential to reach that level, I don't think the Tatas would be concerned about which sport he or she represents. Mumbai was once the cradle of Indian cricket. There was a time when 80 per cent of the Test players in the Mumbai team were from the Tatas. I believe it’s possible to bring that era back and break the mindset that sports people are not productive from the business point of view. Serving up an ace Fantastic players, passionate fans, a superb arena, unlimited fun and scintillating tennis — the Tata Open 2003 was a winner from start to finish The gladiatorial spirit in sport shines brightest in individual disciplines. There’s something about one-on-one combat that team games can never provide, and the sport that exemplifies this singularity best is probably tennis. You would believe it definitely is — if you witnessed the recently concluded Tata Open Championship 2003, a feast of skill, strength, athleticism and uncompromising competition. And loads of fun. Once every 12 months, in a week that straddles two years, an international tennis caravan rolls into Chennai with top-ticket performers to deliver sporting entertainment of the highest quality. A world-class organisational set-up, the country’s finest tennis arena, passionate and knowledgeable fans, and the generous support of the Tata Group have made the Open India’s premier sporting event. This year’s championship, which unfolded at the bull-pit cauldron that is the Nungambakkam Stadium on December 28, 2002, and climaxed on January 5, 2003, had more than its share of potent elements: drama on the court, a multitude of events off it, and a ‘Thaigar’ who thrilled fans and tamed opponents with style and panache.
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The Tata roll call of champions Some of the prominent sportsmen and women associated with Tata Group companies and the Tata Sports Club who have won a multitude of honours, both on the playing fields and beyond Sportsmen and women associated with Tata Group companies and the Tata Sports Club have won a multitude of honours, both on the playing fields and beyond. Among them are world champions, winners at the Olympics, the Asian and Commonwealth Games, and others. Here are the most prominent of them. Athletics Mohinder Singh Gill
TC Yohannan
PC Ponnappa
KL Powell
AP Ramaswamy
MP Ravi Kumar
Parveen Kumar
Sucha Singh
BV Satyanarayan
Edward Sequeira
Satish Pillai
Baldev Singh
Shivnath Singh
Adrian Kennedy
AF. Countinho
VC. Borromeo
MG Murlikuttan
Anil Kumar
Balwinder Singh
Pavittar Singh
MG. Shetty
Bagicha Singh
Ajmer Singh
Jujhar Singh
Mercy Kuttan
Iqbal Singh
Rajinder Singh
Ajit Bhaduria
Vijay Pal
Saroj Lakra
BRH Prasad
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Archery Sanjeev Singh
Purnima Mahato
Limba Ram
Lalrem Sanga
Basketball Sunil Panda
M Jaganathan
Sunil Tandon
R Srivastava
T Vijayraghavan
S Qureshi
Harbhajan Singh
UJ Anthony
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Approach towards the Environment, Pollution and Ecology
Environment
The Tata ethos places a special emphasis on environmental and ecological issues. The Group's efforts to preserve and regenerate the environment find expression in the slew of projects and programmes it has undertaken in and around its facilities and operations. A focus area for the Group, in this context, is the climate change crisis
Nurturing nature The Tata Group's kinship with the environmental cause has resulted in a slew of initiatives that place the good earth above bottom lines A big chunk of the responsibility for containing the plague driving our polluted and populous planet towards peril rests with industry and business. Balancing the imperatives of creating jobs and selling products and services with the absolute necessity of protecting and regenerating what remains of the natural environment is an onerous challenge. That it can be done is beyond doubt, but this is a task requiring a commitment to ideals more than bottom lines, to the good earth rather than profiteering. The long history of the Tata Group teems with examples of just such a commitment.
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The Tata ethos places a special emphasis on environmental and ecological issues. "Environment is a focus area within our overall corporate social responsibility matrix," says Kishor Chaukar, chairman, Tata Council for Community Initiatives, a centrally administered nodal agency that coordinates, among other activities, the environmental efforts of group companies. A host of Tata companies also adhere to environmental procedures drawn up by the Global Reporting Initiative (GRI), which operates under the aegis of the United Nations. Important as it is, following directives and guidelines from within and without is just one facet of the Tata approach to environmental issues. The greater portion of what the Group does in this sphere is by choice and conviction. From this flows its support for endeavours to conserve plant and animal species, improve land and water use, and protect forest tracts and green sanctuaries. The central tenet of this earthy philosophy is people and communities, often in rural regions and frequently facing inequitable struggles to secure livelihoods. Understanding that no environment policy can operate in isolation means an enhanced ability to link processes and people in a manner that benefits both nature and those dependent on it. The Group's contribution to conservation falls into two categories: the efforts of different Tata companies, big and small, to preserve and enrich the environment in and around their areas of operation, and the philanthropic thrust of the Tata trusts, which support a diverse cluster of non-governmental organisations working in areas such as the management of natural resources, community development and livelihoods. This dual canopy accommodates and nurtures a variety of initiatives in a range that extends from watershed programmes and land regeneration to forestry projects and the protection of endangered species.
The flora and fauna stories and articles in this subsection attempt to encapsulate the Tata Group's allegiance to the environmental cause. "Ours is a deliberate effort to do more than what is required by statute," says Mr Chaukar. "Our real contribution, on the environment front and on the entire corporate responsibility issue, is being 98
socially responsible, and that means doing much more than staying on the right side of the law." Mr Chaukar articulates the Group's environmental philosophy as an obligation to society. "Some people think that environmental matters are cause for concern. The Tatas, on the other hand, view them as an inherent duty that is part and parcel of being in business. The general mindset, the discourse of our times, tends to see the environment as something we have inherited from our ancestors. The reality, as I see it, is that we have borrowed it from our children and the generations after them. "Looked at from that perspective, it becomes obvious that I as an individual, I as a corporate entity, I as a factory, have no God-given right to do what I please with what can never truly belong to me. Polluting the environment in one place to supply a product to consumers in some other, far-removed place — how can that ever be justified? There used to be a time when rivers were sources of clean drinking water; today any child will tell you that rivers are giant garbage cans, carriers of filth and waste. There is no way out of this messy situation other than affording the environment the highest priority, and that's what the Tatas are doing." Only those living in denial can argue that environment and ecology are subjects too esoteric for a society bred on consumerism and the pleasures of the present. Humankind is currently engaged in the surprisingly easy job of driving into extinction more plant and animal species than at any time since the dinosaurs disappeared 65 million years ago. Our forests are fading; our oceans are rising; the snowcaps on our mountain peaks are shrinking; our climate is mutating. Meanwhile, our water, our air and our bodies are becoming the unwitting recipients of all manners of toxic intruders. Business can — and do, as the Tatas have proved — make a huge difference in turning this beastly tide.
Environment policies
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The Tata Group has striven to be responsible and sensitive on ecological and environmental matters. It does this by protecting, conserving and restoring natural resources, often beyond what is mandated by government and other institutional policies. Tata companies are committed to complying in full measure with all regulations relating to the preservation of the environment around its operations. By constantly upgrading the technologies they use and by applying the best of sustainable processes and practices, they endeavour to give environmental issues the priority they deserve. The companies are dedicated to constantly improving their performance on the prevention of pollution, the proper use of natural resources and the minimisation of any hazardous impact stemming from the production, development, use and disposal of any of their products and services. Towards this end, the Group continuously trains its employees and creates awareness among its business associates, customers, stakeholders and the community at large through a process of participatory dialogue and collaboration The Tatas have what is known as a 'Group environment network' to guide its companies and organisations on environmental issues. The objectives of this network are three-fold: •
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To develop a common approach on the environment so that Group companies can champion the cause of sustainable growth and enhance the image of the Tata brand. To integrate environmental parameters in the Tata Business Excellence Model and the Tata Code of Conduct. To enhance awareness and to train Group environmentalists through workshops, and share their experiences through case studies and exchanges.
The Tata approach to environmental management makes it mandatory for Group companies to do the following: • • • •
• • • • • • •
Have a vision and mission statement that explicitly states its policy on environmental management. Define a corporate environment policy and communicate that to all employees. Set up environmental management systems and programmes at the organisational level and annually budget for environmental improvement. Train its workforce on environmental issues and assign management representatives and facilitators to the task of monitoring environmental systems. Regularly scrutinise resource consumption and the quality of air, water and land in and around the areas where it operates. Set quantitative objectives and targets for continuous improvement (preferably beyond legal compliance). Review environmental performance at different levels in the management hierarchy. Establish a convention for conducting impact-assessment surveys and periodic audits. Publish annual environmental performance in annual reports. Encourage applications and attainment of eco-labels and accreditations such as ISO 14000/01. This is to be followed by lifecycle assessments and eco-labelling for product stewardship throughout the supply chain.
The environment policies of the Tata Group are reviewed continually. Changes or improvements are made as and when these are required (the way the Group is addressing the climate change issue is an example
CSR and its implementation
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Corporate Social Responsibility Tata Power is committed to setting high standards in its pursuit of social responsibility and remaining sensitive to the issues of resource conservation, environment protection and enrichment and development of local communities in its areas of operations. The company has a simple philosophy that guides its activities in these matters, “Giving back is a means towards going ahead". Our widespread programmes on biodiversity conservation, afforestation, pisciculture, family planning, health services, primary and secondary education and many more have made inroads into the tiny hamlets and tribal regions of our hydro catchment areas and it is our endeavour to light up these dark and narrow streets to new dawns.
Awards • CII EXIM Bank Award 2005 – "Certificate for Strong Commitment to Excel". 102
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“Energy Efficient Unit Award” at the National Award for Excellence in Energy Management – 2005 for T&D divisions conducted by CII.
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Jojobera has been declared as the winner of Golden Peacock Special Commendation Certificate for the year 2005 (11 June 2005).
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Tata Power among the top 13 Best Managed Companies in India by Business Today – AT Kearney (11 March 2005).
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The 2nd Wartsila – Mantosh Sondhi Award for outstanding contribution to the Indian Power Sector in 2004.
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Greentech Environment Excellence Award: Platinum to Jojobera Thermal Power Plant, Jharkhand in 2004.
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Greentech Safety Award: Gold to Trombay Thermal Power Station, Mumbai in 2004.
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The Power Plant Award, instituted by Electric Power International, to the Trombay Thermal Power Station in 1995.
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Outstanding Structures of the Year by the American Concrete Institute: Bronze Award to the Trombay Thermal Power Station for the year 1988 – 1989.
Community initiatives
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The many companies of the Tata Group are involved in a wide variety of community development projects and programmes, principally in India but also, increasingly, in different parts of the world (these initiatives are distinct, and separated, from the social uplift efforts of the Tata trusts). The community development endeavours of Tata companies cover many areas, from health and education to livelihoods, women-children welfare and more Overview: The panoply of community development endeavours undertaken by Tata companies — embracing everything from health and education to art, sport and more — has touched, and changed, many lives. Tata Council for Community Initiatives: The Tata Council for Community Initiatives is the umbrella agency that guides and supports Tata Group companies with their community development initiatives. Reinforcing the implicit beliefs the Group brings to its mission of sustainable development with an explicit set of structures, TCCI has a charter that embraces social development, environmental management, biodiversity restoration and employee volunteering. Tata index for sustainability: The Tata index for sustainable human development is a pioneering effort aimed at directing, measuring and improving the social uplift programmes that Group enterprises undertake. The index provides guidelines for Tata companies looking to fulfill their social responsibilities, and is built around the Tata Business Excellence Model.
Tata company initiatives: Different Tata companies have in-house
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organisations to implement and manage the community development projects that they undertake. The most prominent of these are the Tata Chemicals Society for Rural Development, the Tata Steel Rural Development Society, Rallilove ACTS (Assisting Communities Through Service) and Voltas for Women.
The rainbow effect The panoply of community development endeavours undertaken by Tata companies — embracing everything from health and education to art, sport and more — has touched, and changed, many lives The time was the early 1990s and the occasion was gathering of industrialists called by India’s prime minister, PV Narasimha Rao. Representing the Tata Group were Chairman Ratan Tata and JJ Irani, the managing director of Tata Steel at that point. “The prime minister proposed that we business people set aside 1 per cent of our net profit for community development projects totally unconnected to the workers and industry any of us was involved with,” recalls Mr Irani. “Mr Tata and I looked t each other; we didn't make any comment. Later, we drew up a chart that quantified Tata Steel’s contribution on Mr Rao’s scale. We discovered that, over a 10-year period, the company had been dedicating between 3 and 20 per cent of its profits to social development causes. In the years since, depending on profit margins, the figure has continued to vacillate within this band.” The Tata Steel example is not an anomaly for a Tata company. If there is one attribute common to every Tata enterprise, it has to be the time, effort and resources each of them devotes to the wide spectrum of initiatives that come under the canopy of community development. The money numbers are staggering: by a rough estimate the Tata Group as a whole, through its trusts and its companies, spends about 30 per cent of its profits after tax (PAT) on social-uplift programmes.
The Tata Steel example is not an anomaly for a Tata company. If there is one attribute common to every Tata enterprise, it has to be the time, effort and resources each of them devotes to the wide spectrum of initiatives that come under 105
the canopy of community development. The money numbers are staggering: by a rough estimate the Tata Group as a whole, through its trusts and its companies, spends about 30 per cent of its profits after tax (PAT) on social-uplift programmes. In India and abroad No matter how elaborate, systems and processes cannot really capture the magnitude and dispersion of all that the Tatas do in the field of community development. From health and education to livelihoods and women-children welfare, from tribal hamlets in Jharkhand and the rural outback of Gujarat to the high ranges of Kerala and disadvantaged villages in Andhra Pradesh — the community work being undertaken by Tata companies touches a multitude of Indians across the land. Beyond purely social work, this support extends to individuals and institutions pursuing artistic, sporting and academic excellence. And now, as Tata enterprises spread their wings to reach global locations, the social uplift efforts of the Group are reaching communities in different parts of the world. Arts and sports A different dimension of this social development doctrine shines through in the Tata support and backing that enriches the country's cultural and sporting spheres. In the field of art, this support has played a critical part in preserving and promoting every component of India's cultural heritage. The Tata backing for sports — in the form of academies for a variety of sporting disciplines, sponsorship of talented individuals, and organisations such as the Tata Sports Club — has helped numerous sportspeople realise their potential. The panoply of the Tata engagement in community development encompasses much more than can be encapsulated in a few pages. As management guru Peter Drucker says: "A healthy society requires three vital sectors: a public sector of effective governments; a private sector of effective businesses; and a social sector of effective community organisations." While there's not much it can do about the first sector, the Tata Group is contributing all it can to the other two.
Tata index for sustainability
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The Tata index for sustainable human development is a pioneering effort aimed at directing, measuring and enhancing the community work that Tata Group enterprises undertake. The index provides guidelines for Tata companies looking to fulfil their social responsibilities, and is built around the Tata Business Excellence Model, an open-ended framework that drives business excellence in Tata companies.
Speaking about the Tata index, Anant G Nadkarni, VP, Group corporate sustainabiity, says: "We have adopted a business model to drive social responsibility efforts within the group because that way you ensure a huge network. The index helps structure our efforts and quantify their effect on the communities and people they are aimed at." The index is actually a set of guidelines for Tata companies looking to fulfil their social responsibilities, and it is the third set of such guidelines fashioned by TCCI. Mr Nadkarni sees the index as a work in progress, not some edict set in stone. "What we have here is a framework; that's the spirit in which the Index was drafted."
Name and Performance of the Companies controlled by the Business House
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Companies
Tata Steel is the world's sixth largest steel manufacturer. It operates in more than 20 countries and has a commercial presence in over 50.
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The company was established in Jamshedpur, India, in 1907. In the past few years, Tata Steel has invested in Corus (UK), Millennium Steel (renamed Tata Steel Thailand) and NatSteel Asia (Singapore). With these, the company has created a manufacturing and marketing network in Europe, South East Asia and the Pacificrim countries. It has the capacity to produce over 26 million tonnes of crude steel every year. Areas of business The company produces crude steel and basic steel products, and makes steel for building and construction applications through Tata BlueScope Steel, its joint venture with Australia's BlueScope Steel. Tata Steel has also set up joint ventures for the development of limestone mines in Thailand, the procurement of low-ash coal from Australia and coking coal from Mozambique, and the setting up of a deep-sea port in Orissa in India. The company is exploring opportunities in the titanium dioxide business in Tamil Nadu, India, and will soon be producing high carbon ferrochrome from its plant in South Africa. Joint ventures, subsidiaries, associates •
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Corus Group: Europe’s second largest steel maker with major operations in the UK and continental Europe, Corus produces long and strip products for the construction, automotive, packaging, engineering and other markets worldwide. NatSteel Asia: A leading supplier of premium steel products for the construction industry, NatSteel has operations in seven countries in Asia. Tata Steel Thailand: A major steel producer in Thailand, the company produces steel for the construction industry. Tinplate Company of India: Industry leader in India in the manufacture of tinning line products, including electrolytic tinplate, tin-free steel and coldrolled products. Tayo Rolls: India’s leading roll manufacturer and supplier, the company produces rolls for integrated steel plants, power plants, the paper, textile and food processing sectors, and the government mint.
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Tata Ryerson: Offers hot- and cold-rolled flat steel products in customised sizes and quantities. Tata Refractories: Produces high-alumina, basic, dolomite, silica and monolithic refractories and offers design, procurement and re-lining services. Tata Sponge Iron: Produces sponge iron lumps and fines. Tata Metaliks: Manufactures and sells foundry-grade pig iron. Tata Pigments: Produces oxides of iron, dry cement paint, exterior emulsion paint and distemper. Its products are used in paints, emulsions, cement floors and plastics. Jamshedpur Injection Powder: Manufactures carbide de-sulphurising compounds used for the production of low-sulphur, high-quality steel. TM International Logistics: Provides material handling and port operation services at the Haldia and Paradip ports in India; also has freight-forwarding and chartering services. mjunction services: A 50:50 joint venture involving Steel Authority of India and Tata Steel, it is India's largest e-commerce company and the world's largest e-marketplace for steel. TRF: In the business of design, manufacture, supply, installation and commissioning of engineered-to-order equipment and systems in the areas of bulk material handling, processing, reclaiming and blen Jamshedpur Utility and Service Company: Re-engineered out of Tata Steel's town services, JUSCO provides municipal and civic services for townships. Indian Steel and Wire Products: Recently acquired by Tata Steel, ISWP has a wire unit and a steel roll manufacturing unit. Tata BlueScope Steel: A joint venture with BlueScope Steel, Australia, the company offers a comprehensive range of branded steel products for building and construction applications. Dhamra Port Company: A joint venture between Larsen & Toubro and Tata Steel to build a deep-draft (18 metres) all-weather port in Orissa on the east coast of India.
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Hooghly Met Coke & Power Company: A joint venture with the West Bengal Industrial Development Corporation, producing met coke and electric power. Lanka Special Steel: A Sri Lankan unit that manufactures galvanised wires. Sila Eastern Company: Established to develop limestone mines in Thailand, mainly for captive use. Tata Steel KZN: Setting up a high carbon ferrochrome plant in South Africa with an annual production capacity of 135,000 tonnes. Tata NYK: A 50:50 joint venture with Nippon Yusen Kabushiki Kaisha (NYK Line) to set up a shipping company to handle dry-bulk and break-bulk cargo.
Tata Power Tata Power is India’s largest power utility in the private sector today, with a presence in generation, transmission, distribution and trading. The company was established in 1911 as the Tata Hydro-Electric Power Supply Company to supply power to Mumbai. Tata Power has an installed power generation capacity of over 2,300mw in the areas of thermal, solar, hydro and wind energy generation. In addition, the company is implementing a 4,000mw mega power project in Mundra, Gujarat. Areas of business The company operates across the entire power value chain, from generation, transmission and distribution to trading and consultancy. •
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Power generation: Tata Power’s thermal power stations are at Trombay in Mumbai, Jojobera in Jamshedpur and Belgaum in Karnataka (southern India). The hydro stations are at Bhira, Bhivpuri and Khopoli in Maharashtra (western India) and the wind farm is in Ahmednagar, Maharashtra. Tata Power has a 110kw solar plant at Walwhan, Maharashtra and a 17mw wind power project at Supa, Maharashtra. Transmission and distribution: The company supplies power to the cities of Mumbai and Delhi. It is a partner in the 1,200km Tala transmission project, India's first interstate transmission project and one of the largest power grids in the world. Trading: The Tata Power Trading Company has the licence to carry out transactions in power trading in India. Power project related services: The company provides expertise in setting up independent and captive power plants, transmission and distribution projects, and operations and maintenance management in India and overseas.
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North Delhi Power: A joint venture with the Government of Delhi to supply power to the north and northwest areas of Delhi . Powerlinks Transmission: A joint venture with the Power Grid Corporation of India, for the 1,200km Tala transmission project. Tata Power Trading Company: A wholly owned subsidiary and the first company to get a power trading licence from India’s Central Electricity Regulatory Commission . Strategic Electronics Division: An internal division that designs and develops electronic products and systems for India’s defence sector . Nelco: A subsidiary company with core competencies in the areas of systems integration and project management for defence electronics, energy network management, power electronics, VSAT networks and automation. Coastal Gujarat Power (CGPL): The subsidiary behind the Mundra project. Industrial Energy: A joint venture with Tata Steel to develop captive power plants
Tata Motors is India’s largest automobile company. Established in 1945, it is also among the world’s top five manufacturers of medium and heavy trucks and the world's second largest medium and heavy bus manufacturer. It entered the passenger vehicles segment in 1991 and now ranks second in India's in this market. The company, formerly known as Tata Engineering and Locomotive Company, began manufacturing commercial vehicles in 1954 with a 15-year collaboration agreement with Daimler Benz of Germany. It has, since, developed Tata Ace, India's first indigenous light commercial vehicle, Tata Safari, India's first sports utility vehicle, Tata Indica, India's first indigenously manufactured passenger car, and the Nano, the world's cheapest car. Tata Motors has over 1,400 engineers and scientists in six R&D centres in India, South Korea, Spain and the UK. Its vehicles are exported to Europe, Africa, the Middle East, South and Southeast Asia and South America.
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Areas of business Tata Motors makes passenger cars, multi-utility vehicles and light, medium and heavy commercial vehicles. •
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Passenger cars: The company launched the compact Tata Indica in 1998, the sedan Indigo in 2002 and the station wagon Indigo Marina in 2004. Tata Motors also distributes Fiat’s cars in India. Utility vehicles: The Tata Sumo was launched in 1994 and the Tata Safari in 1998. Commercial vehicles: The commercial vehicle range extends from the light two-tonne truck to heavy dumpers and multi-axled vehicles in the above 40tonne segment. Passenger buses: The company also manufactures and sells passenger buses, 12-seaters to 60-seaters, in the light, medium and heavy segments.
Joint ventures, subsidiaries, associates Tata Motors has joint ventures with Marcopolo, the Brazil-based maker of bus and coach bodies, and with Fiat Auto (to build a commercial vehicle at Fiat's facilities in Córdoba, Argentina). Other associates include: • • •
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Tata Daewoo Commercial Vehicle Company, a 100-per cent subsidiary of Tata Motors in the business of heavy commercial vehicles Tata Motors European Technical Centre is a UK-based, 100-per cent subsidiary engaged in design engineering and development of products. Telco Construction Equipment Company makes construction equipment and allied services. Tata Motors has a 60 per cent holding; the rest is held by Hitachi Construction Machinery Company, Japan. Tata Technologies provides specialised engineering and design services, product lifecycle management and product-centric information technology services.
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Tata Motors (Thailand) is a joint venture between Tata Motors (70 per cent) and Thonburi Automotive Assembly Plant Co (30 per cent) to manufacture and market the company’s pickup vehicles in Thailand. Tata Cummins manufactures high horsepower engines used in the company’s range of commercial vehicles. HV Transmissions and HV Axles are 100-per cent subsidiaries that make gearboxes and axles for heavy and medium commercial vehicles . TAL Manufacturing Solutions is a 100-per cent subsidiary that provides factory automation solutions and designs and manufactures a wide range of machine tools. Hispano Carrocera is a Spanish bus manufacturing company in which Tata More has a 21-per cent stake. Concorde Motors is a 100 per cent subsidiary retailing Tata Motors’ range of passenger vehicles. Tata Motors Finance is a 100 per cent subsidiary in the business of financing customers and channel partners of Tata Motors
Jaguar Land Rover Jaguar Land Rover is a business built around two great British car brands with exceptional design and engineering capabilities. Jaguar Land Rover’s manufacturing facilities are in the UK. Areas of business Jaguar Cars, founded in 1922, is one of the world’s premier manufacturers of luxury saloons and sports cars. Land Rover has been manufacturing 4x4s since 1948. Its products have defined the segments in which they operate. Jaguar Land Rover’s manufacturing facilities are in the UK. The Jaguar Land Rover business employs over 16,000 people, predominantly in the UK, including some 3,500 engineers at two product development centres, in Whitley in Coventry and Gaydon in Warwickshire. 115
The Jaguar XF, XJ and XK models are manufactured at the company's Castle Bromwich plant in Birmingham, UK, while the Jaguar X-TYPE is produced alongside the Land Rover Freelander 2 at the Halewood plant in Liverpool, UK. Land Rover's Defender, Discovery 3, Range Rover Sport and Range Rover models are all built at Solihull, UK. The business is a major wealth generator for the UK, with 78 per cent of Land Rovers exported to 169 countries and 70 per cent of Jaguars exported to 63 countries. Sales to customers are conducted principally through franchised dealers and importers. Location Jaguar Land Rover is based in the UK. Hooghly Met Coke and Power Company (HMCPC) Incorporated in 2005, Hooghly Met Coke and Power Company (HMCPC) is a joint venture involving Tata Steel and the West Bengal Industrial Development Corporation (WIBDC). Tata Steel holds a 98 per cent stake in the company Areas of business HMCPC is setting up a greenfield project at Haldia, West Bengal (in eastern India) with a proposed capacity of 1.6 million tonne of metallurgical coke. The project will supply metallurgical coke to the blast furnaces of Tata Steel at Jamshedpur, and for sale in the domestic and international market. Designed to meet stringent environmental norms, the plant’s waste heat will be harnessed for power generation by Tata Power Company.
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Location The company’s headquarters is in Kolkata, India. INCAT INCAT is a global leader in engineering and design services outsourcing and IT services. Founded in 1989, the US-based company became a subsidiary of Tata Technologies in 2005. It has more than 3,000 employees at facilities in North America, Europe and the Asia Pacific region. The company is engaged in product and information lifecycle management, engineering and design services, enterprise solutions and plant automation. Areas of business INCAT's services include product design, analysis and production engineering, knowledge-based engineering, product lifecycle management (PLM), enterprise resource planning and customer relationship management systems. It operates mainly in the aerospace, automotive and general manufacturing sectors. The organisation also distributes, implements and supports PLM products from leading solution providers such as IBM, Dassault Systèmes, UGS and Autodesk. Location INCAT’s main offices are in Michigan (USA), Pune (India) and Stuttgart (Germany). Infiniti Retail operates a national chain of multi-brand electronics stores under the brand name Croma. It is a wholly owned subsidiary of Tata Sons, the holding company of the Tata Group.
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The Croma chain The company has a technical and sourcing agreement with Australian retail giant Woolworths. Under the arrangement Infiniti Retail owns and runs retail operations in India while Woolworths provides technical support and strategic sourcing facilities through its global network. Areas of business The Croma chain of stores offers, in different cities of India, a wide range of consumer electronics products across categories and brands. The stores are spread over 12,000 to 20,000 sq ft and have more than 6,000 products and 180 brands in eight categories: home entertainment, small appliances, white goods, computers, communication, music, imaging and gaming software . 118
Location Infiniti Retail is headquartered in Mumbai. Jamshedpur Utilities and Services Company (Jusco The Jamshedpur Utilities and Services Company (Jusco) is India’s first private sector integrated civic services provider with a focus on water services. Jusco was formerly a part of Tata Steel and has been providing municipal services for Jamshedpur since 1907. It was hived off as a separate company in 2003. Today the company works with several urban local bodies and is currently executing projects across the country in Kolkata, Haldia, Muzaffarpur, Bhopal, Gwalior, Bangalore, etc. Jusco is the only Indian water company to have received recognition for its contribution to the development of water sector on the Indian subcontinent by London-based Global Water Intelligence in 2008. The company is also the first Indian water company to receive the prestigious 5th Asia Water Management Excellence Award in 2008 for its contribution towards the development and improvement of the water industry in Asia. Areas of business • Water and waste water management: Operation and maintenance, construction, concession, etc of water and wastewater systems. •
Power services: Operation, maintenance and distribution of power.
• Planning, engineering and construction: Town planning, industrial construction and urban infrastructure. • Public health and horticulture services: Environmental management for healthy living.
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Location Jusco is located in Jamshedpur, India. Landmark Landmark is one of the leading retailers of books and music in India. Established in 1987 as a book retailer in India, it became a part of Trent, the Tata company that runs the Westside retail chain, in 2005. Areas of business Landmark, with over 100,000 book titles, has a wide range of books across different segments. It also has an extensive range of regional publications and a comprehensive selection of music. Its other products include magazines, home accessories, gift items and toys. The company has an online e-store called landmarkonthenet.com and its own distribution business (Westland) that supplies books to all Landmark stores as well as other retailers. The chain also acts as an event host for book launches and promotions, quiz shows, music promotions, etc. Location Landmark is headquartered in Chennai and has stores in Ahmedabad, Bangalore, Chennai, Gurgaon, Lucknow, Mumbai, Pune and Vadodra.
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Mount Everest Mineral Water (MEMW) Mount Everest Mineral Water (MEMW) became a part of Tata Tea in 2007. The company bottles and sells natural mineral water under the brand name Himalayan, which is the only internationally accepted natural mineral water from India. Areas of business MEMW sources its water directly from an underground aquifer located about 130 metres below the earth's surface in the Shivalik range of the Himalayas. Himalayan is bottled at source. The company's clientele includes luxury hospitality chains, premium airliners, multiplexes and restaurants. Location The company's bottling plant is at Dhaula Kuan in Himachal Pradesh, India. Nat Steel Nat Steel Asia is the leading provider of steel in the Asia Pacific region. It has in seven countries: Singapore, China, Thailand, Vietnam, Malaysia, the Philippines and Australia. The Singapore-based company produces about 2 million tonnes of premium steel products. NatSteel became a part of Tata Steel in 2005.
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Areas of business The company makes reinforcement bars, wire rods, wire mesh, prefabricated cages, steel couples and ecomas starter bar systems. Joint ventures, subsidiaries, associates •
Singapore: NatFerrous Pte; NatSteel Trade International
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Australia: Best Bar Pty; NatSteel Australia Pty
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China: Wuxi Jinyang Metal Products ; NatSteel (Xiamen)
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Indonesia: PT Material Recycling Indonesia
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Malaysia: Easteel Services (Malaysia) Sdn Bhd; Southern Steel Bhd
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Philippines: Steel Asia Manufacturing Corp
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Thailand: The Siam Industrial Wire
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Vietnam: Nat Steel Vina
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United Arab Emirates: Middle East FZE
Location The company is based in Singapore.
Nelco Nelco is focused on system integration, automation and product management solutions for industrial controls, power electronics, defence electronics and VSAT networks.
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The company was established in 1940 to manufacture consumer electronic products for the Indian market. It now specialises in the areas of security and surveillance for defence and civil applications, traction, electronics for locomotives, SCADA (supervisory control and data acquisition system) projects, drives and automation, real-time and embedded software, and VSAT-based networks. Areas of business Nelco caters to core industries such as defence, railways, steel, cement, automobile, oil and gas, paper and ceramics. The company operates the following business units: • Strategic electronics: Provides electronic-based solutions in the security and surveillance sectors, including intrusion detection systems, e-fencing systems, integrated security solutions, scanners, explosive detectors and weather management systems. • Building management systems: Integrated building management systems, including HVAC controls, fire alarms, access controls and CCTV. • Energy network management systems: Develops and supplies SCADA systems for sectors such as electrical utilities, railways, water distribution, steel plants, oil and gas industries. • Traction electronics: Provides power electronics equipment to various works of the Indian Railways for passenger and freight AC locomotives. •
Drives: Provides medium and low voltage AC drives for industrial use.
• Tatanet network solutions: Provides VSAT-based networking solutions such as internet over VSAT, bandwidth on demand, interactive distance learning, IP multicast and digital streaming. Also delivers server co-location and managed services facilities.
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Nelito Systems: A joint venture with Itochu, Japan.
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Location Nelco is based in Mumbai, with a manufacturing plant at Navi Mumbai. It has a countrywide sales and service network. North Delhi Power (NDPL) North Delhi Power (NDPL) is a power distribution company that operates in Delhi, India. The company was set up as a 51:49 joint venture between Tata Power and the government of Delhi in 2002. NDPL has a consumer base of over 1 million customers and supplies a peak load of 1,150mw. NDPL is a member of the UN Global Compact Charter. It is also a certified ISO 9001, ISO 14001 and OHSAS 18001 company, with a commitment to safety and environment issues. Areas of business The company supplies power over a geographical area of more than 500sq km. It has instituted several customer-centric initiatives such as online bill payment, automated bill payment kiosks and complaint management systems.
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Location The company is located in Delhi, India. Rallis India Rallis India is one of India’s leading agrochemicals companies. It has more than 150 years of experience in servicing rural markets and a comprehensive portfolio of pesticides, herbicides, fungicides and plant nutrients for Indian farmers. The company has factories in five locations in India and a network of 1,500 distributors that reach more than 40,000 retail counters. It has the largest agrochemicals capacity in the country (10,000 tonnes per annum of technical grade pesticides and 30,000 tonne litres per annum of formulations). Areas of business • The domestic formulation business caters to the crop protection and yield enhancement needs of the Indian farmers through a wide portfolio of products, including insecticides, fungicides, herbicides, plant-growth nutrients and seeds. • The domestic institutional business caters to the bulk and technical requirements of institutional customers. • The international business handles exports of pesticides to all parts of the world. The export basket includes technical-grade pesticides, branded formulations and contract-manufactured products Location The company’s head office is in Mumbai. Plants are located at Akola, Lote, Turbhe, Ankleshwar and Patancheru, all in India.
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Tata Africa Holdings Tata Africa Holdings is the main promoter company of the Tata Group in Africa. The company is responsible for identifying development opportunities and promoting new projects. A subsidiary of Tata International, it was established in Johannesburg, South Africa in 1994. Tata Africa operates in several business sectors across Africa and has entered into joint ventures and partnerships with several African companies. Tata Africa has offices in Ghana, Kenya, Malawi, Mozambique, Nigeria, Senegal, South Africa, Tanzania, Uganda, Zambia and Zimbabwe Areas of business Employing over 750 people, the company operates in many industrial sectors, among them automobiles, steel and engineering, chemicals, information technology, hospitality, food and beverages and farming. The company is also interested in energy and mining. Joint ventures, subsidiaries, associates Some of the major Tata Africa companies are: Tata Zambia, Tata Zimbabwe, Tata Holdings Moçambique Lda, Tata Holdings (Tanzania), Tata Africa Holdings (SA) and Tata Ghana. Location Tata Africa Holdings is headquartered in Johannesburg, South Africa. Tata Africa Holdings Tata Africa Holdings, established in 2005, is an joint venture between Tata Steel and BlueScope Steel for manufacturing and marketing products in coated steel, steel-building solutions and related building products.
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Based in Australia, BlueScope Steel is the global leader in high-quality metallic coated and painted steel products for building and construction, general manufacturing and the automotive sector. Areas of business Tata BlueScope Steel has two business divisions: buildings solutions and coated steel. The building solutions business markets pre-engineered buildings, rollformed roof and wall-cladding solutions and related building components; the coated steel business markets metallic coated and pre-painted steel for the building and construction industry. Location The company’s head office is in Pune, India. The building solutions division has three manufacturing facilities, at Pune, Chennai and Bhiwadi, and a network of 20 sales offices. Tata BP Solar India Tata BP Solar India offers innovative solar solutions that cater to the needs of individual customers, large institutions and communities. The company was set up in 1989 as a joint venture between Tata Power and BP Solar, one of the largest solar energy companies in the world. More than 60 per cent of company sales come from exports, mostly to Europe and America.
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Areas of business Tata BP Solar provides customised solar solutions for: •
Homes, streets and communities.
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The pumping of water for irrigation.
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Road-safety aids.
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Location The company’s head office and manufacturing facilities are in Bangalore. Tata Capital Tata Capital is a finance company that fulfills the financial needs of retail and institutional customers in India. It was established in 2007 as a wholly owned subsidiary of Tata Sons and is registered with the Reserve Bank of India as a systemically important non-deposit taking non-banking financial company (NBFC). The company is focused on providing multiple financial services through an extensive network of over 1,000 customer touch-points covering tier I, tier II and tier III cities.
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Areas of business Tata Capital has financial products and services in the following seven sectors: 1. Distribution and broking: Third-party investment products, equity and commodity trading for retail and institutional customers. 2. Retail finance: Passenger and commercial vehicle loans, used car loans, personal loans, home loans, credit cards and consumer durable loans for retail customers. 3. Commercial finance: Financial products for small and medium enterprises, and project finance for capital equipment and infrastructure. 4. Investment banking: Advisory and debt and equity market products for corporate and small and medium enterprises. 5.
Private equity: Investments in India and other countries.
6. Wealth management: Suite of advisory and investment offerings for high net worth individuals. 7. Rural finance: Relevant financial products for rural customers, including financing of farm equipment, agricultural inputs and agricultural enterprises. The company has entered into an understanding with Japan-based Mizuho Securities Co to promote an alliance in private equity, investment banking including cross border merger and acquisition, securities business including broking and distribution, structured finance and other business areas such as wealth management. It has also entered into an understanding with Equifax Inc and CRISIL to develop plans to create a credit information company in India.
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Joint ventures, subsidiaries, associates • Tata Securities (TSL): A wholly owned subsidiary of Tata Capital Limited engaged in retail and institutional distribution and broking. TSL distributes thirdparty investment products and offers stock broking services of buying, selling or dealing in securities, including futures and options, in its capacity as a member of the Bombay Stock Exchange and the National Stock Exchange. TSL is also a depository participant. • Tata Capital Markets (TCML): A wholly owned subsidiary of Tata Capital engaged in debt and equity capital markets and M&A advisory. TCML has a category I merchant banking license from the Securities and Exchange Board of India. • e-Nxt: A KPO unit specialising in the area of financial services; owned by Tata Capital, Tata Sons and others. • Tata Capital also owns around 4 per cent of equity capital of Development Credit Bank, a growing private sector bank. Location The company is headquartered in Mumbai, India. Tata Ceramics Tata Ceramics produces and sells fine-bone china crockery and tableware in India and other markets. The company was incorporated in 1991 and is an associate company of Tata Power. The company's products are exported to Australia, Canada, Germany, Ireland, Italy, South Korea, New Zealand, the UK and the US. It also sells to institutional customers.
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Areas of business The company's range includes hollow ware, flat ware and mugs in fine-bone china and fine china, in an international range of designs. The china is sold to reputed brands such as Wedgewood, Royal Doulton and Churchill. Location The Tata Ceramics factory is in Kochi, Kerala (southern India). Tata Chemicals (TCL Tata Chemicals (TCL) is the second largest producer of soda ash in the world. It is India's market leader in the branded and iodised salt segment as well as in urea and phosphatic fertilisers. Established in 1939 at Mithapur in the Indian state of Gujarat, TCL has, over the last few years, invested in increasing its stake in the global soda ash business. It has acquired UK-based Brunner Mond group and American company General Chemical Industrial Products Inc, making the conglomerate the second largest soda ash producer in the world. The company also makes food additives and fertilisers and has a varied user industry base comprising glass, paper, textiles, food additives, petroleum, refining, chemicals, dyes, pesticides, direct farm application, etc. It exports to markets in Europe, Africa, South East Asia and the Middle East. Areas of business • Chemicals: The range of chemicals produced at the company’s integrated complex at Mithapur includes soda ash, caustic soda, salt, cement, sodium bicarbonate, bromine and bromine based compounds and gypsum. • Fertilisers: The company manufactures nitrogenous fertilisers at the Babrala plant. The company’s plant at Haldia produces phosphatic fertilisers like diammonium phosphate, NPK complexes and single super phosphate. 131
• Food additives: TCL’s food additives business has two premium products: branded salt and sodium bicarbonate. TCL manufactures four varieties of salt, iodised salt, crystalline salt, vacuum salt and pure salt, and has over 40 per cent market share in the branded salt segment in India. • Agri-services: The company has set up a network of Tata Kisan Sansars (or Tata farmer centres) in the northern Indian states of Uttar Pradesh, Punjab, Haryana and Uttaranchal. The centres are one-stop resource centres for farmers Joint ventures, subsidiaries, associates • Brunner Mond group: The UK-based company is Europe's second largest soda ash business; acquired in 2006. • General Chemical Industrial Products Inc: US-based soda ash manufacturer; acquired in 2008. • Khet Se Agriproduce India: A 50:50 joint venture set up in 2007 with Total Produce, Ireland, the third largest fruits and vegetable distribution company in the world, to start a fruits and vegetables distribution business in India. • Indo Maroc Phosphore SA: An equal partnership with Chambal Fertilisers and global phosphate major, OCP of Morocco; set up in 2005.
Location TCL is headquartered in Mumbai, India. The soda ash plants are located in India, the UK, Kenya, the Netherlands and the US. TCL's cement and salt facilities are in Mithapur, the nitrogenous fertiliser facility is in Babrala and the phosphatic fertiliser plant is in Haldia.
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Tata Power Trading Company (TPTC) Tata Power Trading Company (TPTC) is in the business of trading power units in India. It was incorporated in 2003 as a wholly owned subsidiary of the Tata Power Company, with an equity capital of Rs2 crore. TPTC was the first company in India to receive a power trading licence from the Central Electricity Regulatory Commission, back in June 2004. Areas of business TPTC was initially allotted a category ‘A’ licence, which restricted it to trades up to 100 MUs. This licence was elevated to category ‘F’ to cater to the requirements of a growing business. The company can now, by enhancing its equity base to Rs20 crore, trade in higher volumes without any upper limit. TPTC sources surplus power from various states and private-sector power generation utilities, captive power plants and state-owned electricity boards. Its trading partners include the Maharashtra State Electricity Board, the Madhya Pradesh State Electricity Board, the West Bengal State Electricity Board, the Power and Electricity Department of Government of Mizoram, the Damodar Valley Corporation, the Haryana Power Generation Corporation and Delhi Transco. Location TPTC has its office in Mumbai. Tata Sky Tata Sky, an 80:20 joint venture between Tata Sons and the Star group, provides satellite television services to Indian viewers. The company was incorporated in 2004 and offers a range of media and entertainment options to customers.
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Areas of business Tata Sky's direct-to-home satellite platform delivers more than 100 television channels, movies and interactive services for games, learning, recipes, news, chat rooms, etc. It has state-of-the-art digital infrastructure and a retail network that covers more than 4,500 towns in India Location Based in Mumbai, the company has three call centres (Pune, Chandigarh and Hyderabad). The Tata Tea The Tata Tea group is the world’s second largest global branded tea operation with a presence in over 60 countries. The prominent companies in the group are Tata Tea, the UK-based Tetley group and Tata Coffee. Set up in 1964 as a joint venture with the UK-based James Finlay and Company, the group has operations in branded tea, bulk tea, coffee and other beverages, and also has plantations. The Tata Tea brand leads in volume market share in India while the Tetley brand is the second-largest teabag brand in the world. The group has interests in South African tea company Joekels Tea Packers and Polish tea brands Vitax and Flosana. Areas of business • Branded tea: The company has five major brands in the Indian market — Tata Tea, Tetley, Kanan Devan, Chakra Gold and Gemini — catering to all major consumer segments for tea. Tata Tea’s distribution network in the country caters to over 1.2 million retail outlets. • Specialty tea: Tata Tea sells black, green, fruit and herbal teas under the brands of Tetley, Good Earth and JEMCA.
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• Instant tea: Tata Tetley has an export unit that sells a range of instant tea powders in the US. • Coffee: Tata Coffee produces 9,000 million tonnes of instant and ground coffee annually. It has an exclusive stocking arrangement with the Barista range of coffee bars. Eight O'Clock Coffee is the third-largest coffee brand in the US. • Other beverages: Ready-to-drink teas, energy drinks and Himalayan branded mineral water are a part of Tata Tea's portfolio. • Plantation operations: The company has over 50 tea estates in India, as well as interests in Sri Lankan plantations. Joint ventures, subsidiaries, associates •
Eight O’Clock Coffee: Acquired by Tata Coffee.
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Tata Coffee: Formerly Consolidated Coffee, a subsidiary of Tata Tea.
• Tata Tea Inc: A subsidiary of Tata Tea based in Florida, USA; supplies basic instant tea powders in bulk to manufacturers. • Tata Tetley: A subsidiary of Tata Tea; runs an export unit that supplies instant tea powders to the US. •
Tetley Group: UK-based tea major; has worldwide branded tea operations.
Tata Tea is also associated with the following companies: • Mount Everest Mineral Water Company: Producer of the Himalayan brand of bottled mineral water. • Watawala Plantations: Tata Tea has a substantial interest in this Sri Lankan plantation company.
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• Kanan Devan Hills Plantation Company: Produces and manufactures black tea out of 18 estates in Kerala, India. • Zhejiang Tea Export and Import Company: Tata Tea has recently signed a joint venture contract with this Chinese company to manufacture polyphenols and instant tea extracts. Location The company is headquartered in Kolkata, India. It has plants and facilities in the UK, the US, Australia, Canada, Poland, Russia, Pakistan, Bangladesh and South Africa. Tata Technologies Tata Technologies iKS is the world's leading provider of engineering knowledge and training. Established more than 15 years ago, iKnowledge Solutions (formerly Cadpo) became a subsidiary of Tata Technologies in 2006. Renamed Tata Technologies iKS, the company provides solutions related to the acquisition, distribution, certification and verification of engineering knowledge to the world's top manufacturing organisations. The company is internationally known for its flagship product — i get itTM, an online learning system used by more than 90,000 members and 5,000 enterprises Areas of business TM is a comprehensive online learning system that provides engineering knowledge delivery for AutoCAD, Inventor, SolidWorks, Solid Edge, UG /NX, Pro / ENGINEER Wildfire, Teamcenter, COSMOSWorks and CATIA on a single delivery platform. The company also offers iCHECK, a product that addresses data quality and standards compliance, and knowledge-based engineering products.
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Location The company has offices in Singapore, New Delhi, India and Ireland. Its headquarters is in Colorado, USA. Tayo Rolls Tayo Rolls is a market leader in the manufacture and supply of cast and forged steel rolls. The company was promoted in 1968 by Tata Steel in collaboration with Japanese companies Yodogawa Steel Works and Nissho Iwai Corporation (since merged with Sojitz Corporation). Tayo Rolls manufactures state-of-the-art rolls for modern flat and long product rolling mills. Its customers include key integrated steel plants and rolling mills, the paper, rubber, textile and food processing sectors, and the government mint. It has also been exporting rolls to Australia, Austria, Bangladesh, Belgium, Canada, Egypt, Germany, Indonesia, Kazakhstan, Nepal, Norway, New Zealand, Oman, Qatar, Saudi Arabia, Sweden, Singapore , South Africa, Trinidad, Taiwan, UAE, Romania, Czech Republic and the US. Areas of business Tayo Rolls is a one-stop shop for both cast and forged rolls. The company has diversified into the production of special castings for use in power plants. As a part of its backward integration, Tayo Rolls has set up a mini blast furnace of 40,000 tpa for the manufacture of pig iron. Tayo has a license and know-how agreement with Sheffield Forgemasters International, UK, for the transfer of technology to manufacture forging quality ingots, including round ingots, forged bars, engineering forgings and forged rolls.
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Location The company's plant is located at Gamaria, about 16km from Jamshedpur, in Jharkhand, India. The Tetley Group The Tetley Group is an overseas subsidiary of Tata Tea. The group is in the worldwide branded and packaged tea business and Tetley is the second-largest teabag brand in the world. The group was acquired by Tata Tea in 2000. Tetley was established in 1837. Every year over 60 branded teas are blended and packed for sale in over 67 countries. Tetley is the UK’s favourite brand and is also the brand leader in Canada. The company, which introduced the teabag to the UK in 1953, has one of the largest teabag factories in the world. Areas of business Tetley makes a vast range of teas, including black teas, fruit and herbal teas, green, red, iced, organic, decaffeinated and ready-to-drink teas. Joint ventures, subsidiaries, associates • Good Earth Corporation: A herbal and specialty tea business with an established base in the US west coast; acquired in 2005. • JEMCA: The leading tea company in the Czech Republic, with a strong portfolio of black, green and fruit and herbal teas; acquired in 2006. • Joekels Tea Packers: A South African tea company that manufactures and sells a strong portfolio of brands spanning the economy and mainstream tea sectors; acquired in 2006. • Vitax and Flosana brands: Leading brands in Poland; trademarks acquired in 2007, making Tetley the No 2 brand in the Polish tea market.
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Location The Tetley group has its headquarters in Greenford, West London. It has commercial operations in Australia, Canada, the Czech Republic, Poland and the US, tea-buying operations in Kenya and Malawi, and joint ventures in Pakistan and Bangladesh. The manufacturing facility is located at Eaglescliffe, near Darlington in the northeast of England. The Indian Hotels Company (IHCL) The Indian Hotels Company (IHCL) is India’s largest hospitality enterprise. Established in 1903, the company runs more than 70 hotels under its umbrella brand of Taj Hotels Resorts and Palaces in India and overseas. The latest additions to the Taj portfolio are The Pierre, New York's iconic hotel, the Taj Boston, Campton Place in San Francisco and the Blue in Sydney. Its flagship property continues to be the Taj Mahal Palace in Mumbai. IHCL is the main promoter company and owns about a third of the Taj group's inventory of rooms. In 1993, the company established the Indian Institute of Hotel Management in Aurangabad in Maharashtra in western India.
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Areas of business The Taj group operates three business units: luxury hotels, leisure hotels and business hotels. Its other products include: •
spa therapies under the brand name Taj Spas;
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service apartments;
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wildlife tourism in collaboration with CC Africa;
• Taj Air, a luxury private jet operation, and Taj Yachts, three-bedroom luxury yachts; •
airline catering services.
Joint ventures, subsidiaries, associates • TajSats Air Catering: The largest airline catering service in South Asia and a joint venture with Singapore Airport Terminal Services, a subsidiary of Singapore Airlines. • Roots Corporation: A wholly owned subsidiary that operates the Ginger chain of budget hotels in India. Location IHCL’s head office is in Mumbai, India. Taj properties are located in Asia, the UK, the US, Australia and Africa.
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Titan Industries Titan Industries, a manufacturing company, produces India's largest and bestknown range of personal accessories: watches, jewellery, sunglasses and prescription eye wear. The company was established in 1984 as a joint venture between the Tata Group and Tamil Nadu Industrial Development Corporation. It has, since then, grown to become the largest watch manufacturer in India and the sixth largest in the world. Areas of business Titan has four main business units: watches, jewellery, eyewear and precision engineered components. • Watches: Titan currently has four main watch brands. The flagship brand is Titan and there are a number of sub-brands that cater to strong customer segments. The company also markets Tommy Hilfiger and Hugo Boss products under licensing arrangements. Titan's after sales service is a benchmarked operation, with a network of 750 service centres. The company has a world-class design studio for watches and accessories. • Jewellery: Tanishq is India's largest jewellery brand, offering a range of gold and platinum jewellery, embellished with precious stones. It is available in more than 100 boutiques in 70 cities across India. The jewellery division has an exclusive design studio. • Eyewear: Eye+ is Titan's new division, selling Fastrack sunglasses and a range of prescription eyewear (frames, lenses, sunglasses, accessories and contact lenses). • Precision engineering division: This unit supplies precision components to the avionics and the automotive industry. It also manufactures dashboard clocks for car manufacturers in Europe and America 141
Location Headquartered in Bangalore, India, Titan has manufacturing and assembly operations in Hosur (Karnataka), Dehradun (Uttarakhand), Roorkee (Uttarakhand) and Baddi (Himachal Pradesh) and a plant in Goa. The company has more than 200 exclusive showrooms across 112 Indian cities, making it one of the largest retail chains in the country. Virgin Mobile India Virgin Mobile India is a brand franchise association between the Virgin Mobile Group and Tata Teleservices to launch the Virgin Mobile brand of services in India. The organisation was set up in 2007 to focus on telecom services for the youth market. The Virgin Mobile Group has created internationally recognised brands in mobile telephony, transportation, travel and leisure, and music. Tata Teleservices is one of India's leading telecom service providers, with a customer base of over 23 million. Areas of business Virgin Mobile India will design, market and service Virgin Mobile products in India. The brand will be available in 20 telecom circles and will be serviced by nine centres across nine Indian cities.
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Location The company is headquartered in New Delhi, India. Voltas Voltas is among India's leading air-conditioning, refrigeration and engineering services companies. Set up in 1954, its core competencies lie in air conditioning and cooling appliances and services. Voltas is India's largest supplier of engineering products and services for the textile machinery sector and is a major manufacturer of forklift trucks. It provides solutions in turnkey pumping projects for water, effluent and sewage treatment, and water pollution control. The company has ISO 9001-2000 certification and has executed projects in the Middle East, Southeast Asia, Central Asia, Africa and Europe. Areas of business The company mainly operates in the following areas: • Heating, ventilation and air-conditioning (HVAC) solutions: Includes the entire range of mechanical, electrical and plumbing services for a diverse range of applications, spanning office complexes, airports, malls, mercantile ships, atomic energy plants, IT parks, hospitals, etc. • Cooling appliances: Design, manufacture and marketing of a range of air conditioners and water coolers for household and institutional use. • Engineering products and services: Design, sourcing, installation, training, maintenance, etc of engineering products and services in the fields of textile machinery, machine tools, mining and construction equipment and materials handling equipment.
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• Chemicals: Import and distribution of an array of industrial, specialty and pharmaceutical chemicals, industrial plastics and bulk drugs. The company also exports gelatine, ultramarine blue and agrochemicals. Joint ventures, subsidiaries, associates Voltas's subsidiaries include Metrovol FZE, VIL Overseas Enterprises BV, Voice Antilles NV, Weathermaker, Jebel Ali (Dubai), Simto Investment Company and Auto Aircon (India). Location Voltas has its head office in Mumbai and regional offices in several major cities in India. Its overseas offices are in Abu Dhabi (UAE), Hong Kong and Singapore. The company has factories at Thane (Maharashtra), the union territory of Dadra and Sanathnagar (Andhra Pradesh), all in India.
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Market capitalisation of Tata companies Market capitalisation of 13 Tata Group companies as on 8th October Name of the Company Tata Consultancy Services
Rs. Cr
$ billion 53,490
11.1
323
0.1
Tata Communications
13,144
2.7
Tata Motors
11,564
2.4
2,396
0.5
24,716
5.1
3,508
0.7
17,492
3.6
3,831
0.8
Tata Elxsi
Voltas
Tata Steel
Taj Hotels, Resorts and Palaces
Tata Power
Tata Tea
145
0.8
Titan
3,955
Trent
754
0.2
4,005
0.8
485
0.1
Tata Chemicals
Rallis
Note: Exchange rate $ = Rs48.00
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INNOVATION
Overview In the last few years the Tata Group has extended its global footprint, just as it has enhanced its performance and competitiveness. One of the key drivers of this critical transition has been innovation The Group looks at innovation as a strategic approach to global growth and has adopted a three-pronged strategy to encourage it. The three key drivers are better communication and recognition of innovative ideas and efforts; facilities for learning from other companies; and support for collaborative research and partnerships with academic institutions. Communication and recognition A number of initiatives have been launched to spread the message of innovation and recognise innovators: •
•
•
•
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Tata Group Innovation Forum (TGIF): This initiative brings together a community of ‘innovation enthusiasts’ from across Tata companies. The role of TGIF members is to assist their companies in experimenting with ideas, propagate the relevant ones and spread them through the enterprise. Innovation workshops: Tata Quality Management Services invites experts to talk about various aspects of innovation and share best practices with Tata managers. Clayton Christensen, Langdon Morris and David Wittenberg are among those who have held such workshops in the recent past. Tata Innovation Day: Instituted to encourage creative thinking, this annual event and contest recognises and awards innovation among Group companies. Tata Innovation Mission: Under this programme,senior Tata executives visit global companies to study how they foster innovation.These missions have visited companies such as Microsoft, Intel, HP and 3M in the US,and Nissan, Fuji, Ito En, Olympus, Toshiba and Hitachi in Japan
Tata Group Innovation Forum The objective of the Tata Group Innovation Forum is to help create a culture that fosters innovation in Tata companies Managed by Tata Quality Management Services, the Tata Group Innovation Forum (TGIF) organises a number of events and workshops to facilitate interaction among Tata companies and stimulate innovative thinking. TGIF members comprise senior executives of the Tata Group, innovation experts and academicians. The team is headed by R Gopalakrishnan, chairman of the forum, and has the following members: • • • • • • • • • • • •
Homi Khusrokhan, Tata Chemicals Bhaskar Bhat, Titan R Ramanan, CMC Vinayak Deshpande, Tata Teleservices Clive Hickman, Tata Motors European Technical Centre Satish Pradhan, Group HR B Bowonder, Tata Management Training Centre PS Viswanathan, Tata Consultancy Services Murali Sastry, Tata Chemicals B Shiva, Tata Consultancy Services Sunil Sinha, Tata Quality Management Services Ravi Arora, Tata Quality Management Services
Innovation workshops TGIF invites academics and other experts in the field to conduct workshops and seminars which introduce new innovation concepts and tools and stimulate innovative thinking among Tata managers.
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Thought leadership In order to capture and disseminate the learning from various initiatives, the Tata Management Training Centre in Pune and the Group Publications unit at Tata Sons have been bringing out publications that feature innovation case studies from across the world, while also covering the Tata innovation missions to the US and Japan. Innovation awards TGIF celebrates ‘Tata Innovation Day’ to recognise innovators in the Tata Group. Technology and research clusters To create opportunities for technological innovation, TGIF brings together technologists and researchers from different Tata companies, and undertakes a technology mapping exercise.
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COMPETITORS
Reliance Power Limited, A part of the Reliance Anil Dhirubhai Ambani Group, was established to develop, construct and operate power projects in the domestic and international markets. Reliance Energy Limited, an Indian private sector power utility company along with the Anil Dhirubhai Ambani Group promotes Reliance Power. Along with its subsidiaries, it is presently developing 13 medium and large-sized power projects with a combined planned installed capacity of 28,200 MW. About the company The company was incorporated in January 1995 as Bawana Power Private Limited and changed its name to Reliance Delhi Power Private Limited in February 1995. Later, it changed its name to Reliance EGen Private Limited in January 2004, to Reliance Energy Generation Limited in March 2004, and to Reliance Power Limited in July 2007.[1] The company website identifies project sites broadly to be located in western India (12,220 MW), northern India (9,080 MW) and northeastern India (2,900 MW) and southern India (4,000 MW). They include six coal-fired projects (14,620 MW) to be fueled by reserves from captive mines and supplies from India and abroad, two gas-fired projects (10,280 MW) to be fueled primarily by reserves from the Krishna Godavari Basin (the "KG Basin") off the east coast of India, and four hydroelectric projects (3,300 MW), three of them in Arunachal Pradesh and one in Uttarakhand.
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Business Profile Reliance Power Limited is part of the Reliance Anil Dhirubhai Ambani Group and is established to develop, construct and operate power projects domestically and internationally. The Company on its own and through subsidiaries is currently developing 13 medium and large sized power projects with a combined planned installed capacity of 28,200 MW, one of the largest portfolios of power generation assets under development in India. Our 13 power projects are planned to be diverse in geographic location, fuel type, fuel source and off-take, and each project is planned to be strategically located near an available fuel supply or load center. The identified project sites are located in western India (12,220 MW), northern India (9,080 MW) and northeastern India (2,900 MW) and southern India (4,000 MW). They include six coal-fired projects (14,620 MW) to be fueled by reserves from captive mines and supplies from India and abroad, two gas-fired projects (10,280 MW) to be fueled primarily by reserves from the Krishna Godavari Basin (the "KG Basin") off the east coast of India, and four hydroelectric projects (3,300 MW), three of them in Arunachal Pradesh and one Uttarakhand. Reliance Power has acquired the two ultra mega power projects of 4,000 MW each at Sasan in Madhya Pradesh and Krishnapatnam in Andhra Pradesh. The 7,480 MW project to be located at Dadri in Uttar Pradesh is expected to be the largest gas-fired power project at a single location in the world. We intend to sell the power generated by these projects under a combination of longterm and short-term PPAs to state-owned and private distribution companies and industrial consumers
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Forging ahead, JSW Steel Ltd. is one among the largest Indian Steel Companies in India today. India’s third largest steelmaker, JSW Steel Ltd. consists of the most modern, ecofriendly steel plants with the latest technologies for both upstream & downstream processes. JSW Steel Ltd. has received all the three certificates
Hot Rolled Product
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Cold Rolled Product
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Galvanised Product
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Pre-painted Galvanised Product
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Jindal Vishwas
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Bharti Airtel Airtel comes to you from Bharti Airtel Limited, India’s largest integrated and the first private telecom services provider with a footprint in all the 23 telecom circles. Bharti Airtel since its inception has been at the forefront of technology and has steered the course of the telecom sector in the country with its world class products and services. The businesses at Bharti Airtel have been structured into three individual strategic business units (SBU’s) Mobile Services, Airtel Telemedia Services & Enterprise Services. The mobile business provides mobile & fixed wireless services using GSM technology across 23 telecom circles while the Airtel Telemedia Services business offers broadband & telephone services in 94 cities. The Enterprise services provide end-to-end telecom solutions to corporate customers and national & international long distance services to carriers. All these services are provided under the Airtel brand. Airtel comes to you from Bharti Airtel Limited, India’s largest integrated and the first private telecom services provider with a footprint in all the 23 telecom circles. Bharti Airtel since its inception has been at the forefront of technology and has steered the course of the telecom sector in the country with its world class products and services. The businesses at Bharti Airtel have been structured into three individual strategic business units (SBU’s) Mobile Services, Airtel Telemedia Services & Enterprise Services. The mobile business provides mobile & fixed wireless services using GSM technology across 23 telecom circles while the Airtel Telemedia Services business offers broadband & telephone services in 94 cities. The Enterprise services provide end-to-end telecom solutions to corporate customers and national & international long distance services to carriers. All these services are provided under the Airtel brand.
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Business Divisions MOBILE SERVICES Bharti Airtel offers GSM mobile services in all the 23-telecom circles of India and is the largest mobile service provider in the country, based on the number of customers. INTERNET The group offers high speed broadband internet with a best in class network. With Landline services in 94 cities we help you stay in touch with your friends & family and the world The group focuses on delivering telecommunications services as an integrated offering including mobile, broadband & telephone, national and international long distance and data connectivity services to corporate, small and medium scale enterprises. The Company compliments its mobile and broadband & telephone services with national and international long distance services. It has over 35,016 route kilometers of optic fibre on its national long distance network. For international connectivity to east, it has a submarine cable landing station at. For international connectivity to the west, the Company is a member of the South East Asia-Middle East-Western Europe – 4 (SEA-ME-WE-4) consortium along with 15 other global telecom operators.
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EXPORT Exports surpass target in 2007-08 India succeeded in surpassing its export target of $160 billion in the last fiscal (2007-08), as per the latest date released by the Directorate General of Commercial Intelligence and Statistics. The cumulative value of exports for 2007-08 stood at $162.9 billion, registering a growth of 29.02 per cent over the same period last year, while in rupee terms, it reached a level of Rs. 6.55-lakh crore as against Rs. 5.71lakh crore, a growth of 14.71 per cent.
Major drivers The major drivers of exports during the period were engineering goods (27.34 per cent), petroleum products (51.97 per cent), gems and jewellery (23.27 per cent), agriculture and allied products (55.51 per cent) and ores and minerals (30.34 per cent). Exports of textiles, handicrafts and sports goods, which were badly hit during 2006-07 due to appreciation of the rupee vis-a-vis the U.S. dollar since September 2006, showed improvement in their performance during the year, the data said.
Tata Motors profit up at Rs1,913 crore Tata Motors has announced a net profit of Rs. 2,028.90 crore for 2007-08, an increase of 6 per cent over the previous year’s Rs. 1,913.46 crore. The company’s margins were under pressure during the year due to rising interest rates, constraints in availability of vehicle financing from outside sources and unprecedented increase in input prices. The company had focussed on cost reduction measures but there have been delays in the introduction of two new products, which are soon to be launched.
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Total sales volume (including exports) was at 5.86 lakh units (5.80 lakh units), which is the highest ever for the company. The company maintained its leadership position in commercial vehicles and was among the top three in the passenger vehicles, although it lost some market share. In the domestic market, commercial vehicle sales increased by 4.8 per cent to 3.13 lakh units and passenger vehicle sales declined by 4.5 per cent to 2.18 lakh units. Also, after six years of consecutive growth, 2007-08 saw a 5.3 per cent decline in the company’s sales volume due to heightened competition and other factors. The company has maintained the dividend at Rs. 15 per share of Rs. 10 each for 2007-08. . A new plant at Pant Nagar (in Uttarakhand) for Ace and the Magic range went on stream during 2007-08. Construction activity is on at Singur (in West Bengal) for Tata Nano and at Dharwad (in Karnataka) for buses to be made by the company’s joint venture, Tata Marcopolo Motors. The plants in Pune, Jamshedpur and Lucknow are undergoing expansion and modernisation. Addressing the media here on Wednesday, Ravi Kant, Managing Director, Tata Motors, said the investment over the next four to five years would be Rs. 10,000 crore. “We have plans to introduce around 100 product/variants over the next 4-5 years. The World Truck product will be launched by the end of this year and the platform will unfold over the next 12-15 months. It will be launched simultaneously in India and Korea. The bus plant at Dharwad will probably be the largest bus manufacturing facility in the world,” he said. Over the next 12-18 months, the company will be introducing variants of Ace, Marcopolo buses, the World Truck which is a medium and heavy commercial vehicle by Tata Daewoo, defence vehicles and ready to use solutions. Among the passenger vehicles, the company will introduce versions of Sumo Grande, a new Indica, Nano, Crossover, New Indigo, a new utility vehicle platform and the Fiat Punto and Fiat Linea from Fiat. 156
Impact of LIBERALIZATION, GLOBALIZATION AND PRIVATIZATION on the Current and Future Business Prospectus Restructuring Initiatives- Successes and challenges As the initial europium of opening off the company since 1991 subsided, corporate India was hit by the negative effects of facing up to global competition. Global deflation and reduced margins earlier strategies report that corporate India was left with only one option-restructure and cut costs or perish. History is full of examples of industrial groups that thrived in the industrial RAJ but failed to adjust to the competitive era of the liberalized economy. On the other hand, there were groups that restructured themselves and survived and have prospered in the greater freedom that they now enjoy. Tata group is one of them who had changed themselves according to the liberalization demand. Tata group is probably the best example of a group that has gone through substantial restructuring over the past few years and had survived the slowdown in economy and the lower margins. Tata group had three elements to restructuring the organization: 1. Changing the group ethos: Restructuring of Tata group is more interesting because the issues were not only of adjusting to a different economic environment but also of trying to make a group more cohesive.
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A)Greater say in management of companies: The Tata group operated as a confederation of loose entities where the professional management of each of the Tata companies in operation had total control on the companies and ran it as their felfdom. b) Raising ownership limits: The Tata managed most of the companies with very small stakes. One of the anecdotes a decade ago used to be the fact that Birlas have a higher in TISCO than the TATAS. They now have a stake at least 26% in all major companies making it morally and legally easier to manage them. c) Crating a common brand equity: The Tata name has historically been associated with a reputation for honesty and integrity. However there was no formal set of values running across the various companies in the group. There is now a common code of of operation in the group that is followed by all the companies and reflects what the Tata brand name should stand for. d) Creating common standards: This involved having a common quality standard, which each company adopt, so that the consumer had the assurance of getting a certain minimum from any Tata product. 2) Restructuring of companies internally: This included cutting costs and improving efficiencies to make the companies viable in the new economic environment. For most investors this is the most visible and existing part of restructuring of a company or a group. However, we must remind investors that given the protected nature of the economy, it was more important to create the psychological frame-work so that there was minimum resistance to the changes that were being implemented at the company levels.
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3) Restructuring of the product portfolio: It was said that restructuring of the product portfolio of the group by identifying seven core businesses that did not fit with in these seven years. Restructureing of the product portfolio of the group by identifying seven core business that did not fit within these seven years. Restructuring of the product portfolio again was not an easy exercise, as can be gauged by the fact that there was a need to start with the basic fact of taking an inventory of the companies constituting the Tata group. The Tata group comprised 85 companies in 45 industry group. The report card We believe the restructuring of businesses has made the Tata group leaner and more competitive. While investors do tend to criticize the pace of being too slow, we believe the willingness to sell businesses and the divestment of businesses ecxeeds that of any other group in India. Divestment and Acquisition Accepted By The Group Willingness To Sell Businesses: We believe the greatest positive of the Tata group restructuring has been the willingness of Mr. Tata to sell out of businesses. While this is commonly accepted in western countries, in India,
traditionally, asset ownership was taken as a benchmark of power and progress amongst corporate. Greter aggression in the group: The group has traditionally been a conservative group and has tented to be slow in decision making. There are enough signs, however that this has changed. Apart from some of the restructuring initiatives highlighted above, the group has been an active bidder in the government privatization process. It has bagged two companies – VSNL and CMC amongst tough competition. Pace of restructuring-slow but irresible: Investors have often raised concern on the pace of restructuring. While in hindsight, we agree that the pace could have been hastened, the bigger challenge was changing the mid-set of the people internally so that they accept the restructuring process.
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Shifting Group To Knowledge Based Sectors Inability of businesses to earn retuns greater than cost of capital: Another criticism has been the inability of some of the key businesses of the group to earn return on capital employed greater than the cost of capital. Shift from generic-driven to brand led business: The group has also been making a conscious shifts towards bards driven businesses and services. In FY 1991, brand businesses accounted for around one fifth of sales. Now they account for one fifth of sales in terms of profit similarly, brand businesses and services are playing a more significant role. While the commodity businesses are more cyclical, profits in IT services have secular growth.
Liberalization Growth rates are affected by liberalization but they also depend on other factors, such as savings and investment rates and education policy. In examining inequalities within countries, a further set of theoretical considerations is crucial. In particular, in looking at distributional outcomes it is vital to distinguish primary incomes from secondary incomes. Primary incomes are those generated by the economic system (e.g., wages or dividends) and these are affected by the impact of changes in the structure of the market on the incomes people earn. Secondary incomes, on the other hand, consist of deductions from individuals' primary incomes (e.g., through taxes), or additions to income such as through pensions provided by the state, or remittances from other family members, or public goods, provided mainly by the state, but also by nongovernmental organizations (NGOs) and families. Secondary incomes are thus affected by changes in government taxation and expenditure policies and by access to publicly provided goods and services.
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Privatization The Tata Sons takeover of Computer Maintenance Corporation shows that it is possible to privatise without controversy. A Tata-dominated board decides to use VSNL's cash reserves to invest in Tata Teleservices. Privatisation, in practice, thus becomes a means through which public resources are used to finance private accumulation. Prior to VSNL's disinvestment, the government got VSNL to pay out a dividend of 500 per cent, through which step, given its 52 per cent equity holding, it mopped up Rs.741 crores of the company's reserves. The total dividend VSNL would have paid out at that time would, based on these figures, have amounted to Rs.1,425 crores. In addition, VSNL was made to pay out a special dividend of 750 per cent, which gave the government Rs.1,111 crores. Here again, the total dividend paid out by VSNL would have been Rs.2,136.5 crores. In this manner, VSNL was stripped of Rs.3,561.5 crores of its cash reserves prior to privatisation. Add to this the Rs.1,200 crores that VSNL is investing in TTSL, and the total works out to Rs.4,761.5 crores - which is more than the total equity capital of TTSL. That is, without resorting to strategic sale the government could not only have retained control of a profitable telecom major like VSNL, but could have through its own investments integrated with the consumer. In hindsight, the government's decision not to give VSNL a basic services licence was a way of preventing it from exercising this option, perhaps forged by the decision to hand the firm over to the private sector.
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Globalization It is a company that stated its operations less than a decade ago and in the brief span has charted its course on the world map. Tata autocomp systems has traveled the long road. In the competitive auto components industry, the company has strengthend its position in the domestic market and forged joint venture partnerships in order to become a major global player. The auto comp industry is subject to a three level global tierisation. On the first rung are those manufacturers who supply directly to the automaker. The company now aspires to become a tier one supplier globally. A step towards that direction was taken recently with a $100 million order from ford for supply of plastic parts. At the tier two level, TACO is supplying wiring harness to Yazaki, its Japanese partner. Yazaki, in turn supplies its products to Toyota and Nissan. This is worth between 7 and 8 million dollars in the current year, but the company accepts it to grow to $100 million per annum in future. Another example of its tier two business is a partnership with Ficosa. Tata Ficosa will become the sole supplier for the internal view mirror, for Ficosa customers worldwide. “Having now paved the way into international businesses, the next challenge for TACO is to become a one-stop-shop supplier.” Says D.S.Gupta, M.D of TASCO.
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The major players of the auto industry are present in the US, Europe and Japan. It is, Therefore, important for the company to set up show in Asia and the West. In Asia, TACO is looking at setting up officers in Thailand, China, Taiwan, Vietnam, Malayasia and Koria. Asian countries have certain advantages that India can use to its benefit. TACO has spotted some of the advantages in its partner countries. Malayasia produces cheap rubber, China has raw materials for plastic, while Taiwan is well known for actual assembly of electronic components. The company should be able to use the core facility and to learn to build capability at low cost. TACO has recently acquired an order from General Motors and Ford. It is in the process of setting up a corporate office in the US that will oversee operations both in the Us and Europe. The company also proposes to set up manufacturing and engineering offices in Germany and France in the near future. Despite the global recession in the auto industry, TACO has managed to survive and grow by focusing on quality, cost and delivery. The company has created values for its customer by pushing quality through the six sigma programme. Sequential delivery system is a global norm and by adhering to it, TACO illustrates its strengths in QCD. As a result of this, the company has been growing at a CAGR of 30% p.a. The companys turnover was Rs. 817 crore in 2002-03, and this year it is expected to gross between 1200 to 1300 crores.
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Tatas Some Acquisitions And Partnership Globally Tata to acquire 26% in telecom JV with S.Africa Govt. The Tatas are picking up 26% in infra co, a new telecom company in S.Africa. The remaining stke in the company will be held by the South Africa Government. The joint venture will be the third network operator in S.Africa, and apart from offering long distance services within the country, it will also build and operate marine telecom infrastructure for international long distance traffic. The deal also marks the TATAS second telecom venture in South Africa. VSNL already has a 26% stake in SNO Telecom, which has license to provide all telecom services, except mobile services. Infra co. will require about $350 million just to launch operations. Of this, the S.African Government will provide $225 m, VSNL about $ 60m, while the rest will be funded by debt.
Tatas pick up 30% in US bottled water co. for $677m. TATA TEA, Indias largest tea maker, will pay about $677m to buy 30% of US based energy brands, which sells a range of nutrient rich and flavoured water brands. The deal values EBI at $2.3b, or 6.4 times its sales, and is the largest ever acquisition by an Indian company, edging out Dr. Reddy’s $570m buy out of Germany’s betapharm. The Acquisition expands Tata Tea’s foothold in American market and is aimed at consolidating the company’s position in the global beverage industry. The buyout of Tetley for 271m in 2000 gave a company a major presence in the UK and the US.This was followed by the june ’06 purchase of Eight O’Clock Coffee for about $220m. 165
Tata tea will finance the deal by investing $192 in tata Tea GB, The UK subsidiary which own Tetley. The firm’s consolidated debt- equity ratio at the end of march ’06 was 1:1, and it generated Rs.300 crore net cash from operating activities.
Tata’s buy Ritz-Carlton In a deal that will expand its presence in US market, Indian Hotels, which runs Hotels and Resorts under Taj brand, is buying the Boston based Ritz-Carlton hotel for $170m.The deal will be carried out through its US subsidiary, International Hotel Management Service. The 79 years old Ritz-Carlton is the longest continuously run hotel in the US, and is owned by millennium partner. The Hotel opened for business in 1927 and was bought by Millenium Partners of New York in 1999 for $122m. Indian Hotels owns 75 Hotels, is currently carrying out due diligence for the Ritz-Carlton. Tata steel acquired Singapore-based NatSteel in Rs.1313 Crore deal in 2004. Tata steel acquired Thailand-based Millenium Steel for about Rs. 675 Crore in 2005. Tata steel also trying to acquire Dutch based Corus (which is 7th largest steel company in terms of volumes) in about $ 8.3 bn .
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Important Milestones and Turning Points Will it be a million this fiscal? Domestic passenger car and utility vehicle sales are racing ahead with 8.02 lakhs vehicles being sold in the April- February 2004 period. Just domestic sales may fall tantalizingly short of the mark but if exports (1.12 lakh cars in the same period) are included, total industry sales will cross the magic million milestone quite comfortabely in 2003-04. This is a significant figure for the automobile industry and could well be turning point from where there is no looking back. The significance is not just in the number of cars sold but in the quality and category of sales of sales. In what can be constructed as a maturing of the market, sales in the mid segments –that is, the Rs. 4.5-6.5 lakh range –has galloped, growing at a faster pace than the mass market B and A segments. Just consider these numbers. Just consider these numbers. Total passenger car and utility vehicle sales grew by 30 percent in the April-february period. While the A and B segments grew by 24 percent each, the real push came from the same C, or mid-sized car, segment which witnessed a 53 per cent growth. Equally impressive was the performance of the D segment where volumes shot up 12-fold to 12,526 cars, or a little more than a 1000 cars a month. And this segment boasts of the Skoda Octavia and the Toyata Corolla, which are supposed to be premium models with limited market. Roughly one out of every five cars sold in the last one year was in the mid-size segment and that is
almost the same as the entery level A segment where the only model is Marutis M-800. In 2002-2003 the corresponding ratio was one out of every six. So what do these numbers convey?
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Market is evolving without doubt we are witnessing a significant evolution in the passenger car market with buyers upgrading to mid-size cars, which is really the entery-level segment in the developed markets. There could be a couple of factors driving sales in this segment. One is better choice. There are more models available in this segment today compared to the couple of years back. The arrival of the Tata Indigo has served to expand the market for midsize cars as have the Opel Corsa from General motors and the new Honda city. These three models, along with the the Hyundai Accent, appear to have been the main drivers for growth in this segment even as those such as Mitsubishi Lancer and Fiat Siena have lagged in the market-share sweepstakes. This segment is dominated by Tata Motors and Hyundai with a 20 per cent share each; marutis share is just half that. The second factor is rising income levels, especially the concentration of high incomes at the hands of young people who are obviously aspiring for better quality cars that are present in the mid-size segment. Adding fuel to this are the various finance schemes available in market that reduce an Opel corsa or a Tata
Indigo to a monthly EMI of about Rs 5,000, which is considered quite affordable.
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Progress over the years The Tata group Indias best known conglomerate in the private sector with a turnover of around US $ 20.4 billion. Long known for its adherence to business ethics, it is Indias most respected private sector group. With 210,443 employees across 93 companies, it is also Indias largest employer in the private sector. The Groups early years were inspired by the spirit of nationalism. The group pioneered several in first Indian industries: Indias first private sector steel mill, first private sector power utility, first luxury hotel chain and first international airlines, amongst others. The groups pioneering spirit continued with Tata consultancy services, today Asias largest Software and services company, and Tata Motors, the first car maker in a developing country to design and produce a car from the ground up. The business operations of the group currently encompass seven business sectors – Engineering, Materials, Energy, Chemicals, Consumer Products, Services, and Communications and information systems, and the scale of the groups operations and increasingly turning global. Tata Tea is the first Indian MNC in the global tea industry and indias largest integrated tea company; Tata Chemicals is asias largest manufacturer of soda ash; Titan is one of the worlds top six manufacturer brands in the watch segment and Tata Motors is amongst the top six commercial vehicle manufacturers in the world. The group is increasingly focusing on new technology areas: it has the largest footprints in Indias new economy, and is the countrys largest private sector telecom service provider, and group company VSNL is one of Indias leading international communication and internet service providers.
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The group has always believed in returning wealth to the society which it serves. Thus, nearly two-thirds of the equity of Tata sons, the groups promoter company, is held by philanthropic truste which have created a host of national institutions in natural sciences, medical care, energy and arts, and which give substantial annual grants and endowments to deserving indivisuals and institutions in the areas of education, healthcare and social upliftment.
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Development of Tata Iron & Steel Company: Late 1800s-1980s From the mid-1880s, Tata commissioned a series of surveys in India's coalproducing areas, such as Bihar and Orissa in the northeast of the subcontinent, to locate iron ore within easy reach of coal deposits and water, both essential elements in steel production. He visited the United States to seek the advice of the world's foremost metallurgical consultant, Julian Kennedy, and went to Birmingham, Alabama, to study the coking process in action. In England in 1900, he discussed his plans with the secretary of state for India, Lord George Hamilton. In India, the way had been opened for private enterprise with the introduction of a more liberalized mineral concession policy in 1899. With Julian Kennedy's help, American specialists were brought in and began surveying in 1903. After a series of disappointments, rich iron ore deposits were identified in the dense jungle in Bihar at the confluence of two rivers near Sakchi three years after Jamsetji Tata's death in 1904. Also involved in the surveying was Tata's nephew, Shapurji Saklatvala, whose health suffered so much that he was sent to London to recuperate. There, he joined his uncle's London office, which had been established some years earlier to represent the interests of the family cotton business. His energies were soon channeled away from business matters and into politics, and he became Communist member of Parliament for Battersea North in 1922. Four years after Tata's death, his sons Dorabji and Ratanji began development of the Bihar site. A factory and township were carved from the jungle and named Jamshedpur. A conscious decision was made to retain control within India of the new enterprise, the Tata Iron and Steel Company, by seeking out Indian investors. In the face of warnings that India could not afford a flotation of this size, the Tata brothers set out to raise Rs 23.2 million in shares. Within eight weeks some 8,000 Indian investors came forward and the whole share issue was taken up.
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The Tatas retained 11 percent of the stock for themselves. There were enormous initial problems in clearing the Sakchi site and, once production began, in ensuring that the coal was of a uniform quality. By 1916, however, production was meeting expectations and during World War I the company exported 1,500 miles of steel rails to Mesopotamia. Rapid expansion to support the Allied war effort was followed by Depression during the 1920s with escalating prices, transport and labor difficulties, and a major earthquake in Japan, by now TISCO's biggest customer. The company had to suspend its dividend for 12 out of 13 years in this period and was on the brink of closing in 1924 when Sir Dorabji Tata had to pledge his personal fortune to secure the necessary bank loans to keep the business afloat. TISCO emerged from the 1930s, however, as the biggest steel plant in the British Empire. World War II brought a resurgence in demand for Tata products and the company specialized in the manufacture of armored cars, known as Tatanagars, which were used extensively by the British Army in the North African desert. Following six years of almost continuous production to serve the war effort, it became imperative in the late 1940s to begin replacement of the plant. In association with Kaiser Engineering of the United States capacity was expanded and a Modernization and Expansion Program (MEP) was launched in 1951, upgraded four years later to the Two Million Ton Project (TMP) to give TISCO the capacity to produce two million tons of crude steel. This was achieved in 1958 but further expansion was put on hold during the 1960s while the country passed through a period of devaluation and recession. By 1970, however, TISCO employed 40,000 people at Jamshedpur, with a further 20,000 in the neighboring coal mines. Government attempts to nationalize TISCO in 1971 and 1979 were defeated, in part, it was believed, to retain an efficient private sector yardstick against which the performance of public sector companies could be judged. An ever-increasing range of government legislation to bring private sector businesses into line with national economic planning on the Soviet model, however, hampered Tata's freedom to develop in the postwar period. In 1978, the government restricted TISCO's dividend to 12 percent to force it, as India's only private sector steel producer, to plough money into modernization. Expansion was restricted by a government committed to helping nationalized industry. 173
Further difficulties were created in the late 1970s by chronic shortages of coal, power, and rail transport. An estimated Rs 45 crores of salable steel was lost during 1979-80 because of these shortages. TISCO soldiered on, however, and in the following decade began to benefit from a relaxation of government control as a more pragmatic attitude to the importance of private sector industry emerged. In 1989, the Tata group increased its stake in the steel firm to ward off any attempts by outside shareholders to gain control of the company. By 1990, TISCO remained India's largest nonpublic company, announcing a 30 percent increase in profits against a backdrop of general depression in the Indian economy as a whole. Growth of the Tata Empire Over the Course of the 20th Century The growth of Jamshedpur and the involvement of the firm in every aspect of its industrial and municipal life was the subject of several studies. Jamsetji Tata was both a nationalist and a philanthropist. He showed a paternalistic concern for the well-being of his employees, which set the tone for future company policy. The British proponents, pioneers of social reform Sydney and Beatrice Webb, were invited out to India from England to advise the Tatas on the best form of social, medical, and cooperative services for the newly established Jamshedpur and as a consequence schools, recreational facilities, creches, and other amenities were established on site at an early stage. An eight-hour working day had been introduced in 1912, an officially recognized Tata Workers' Union established with Gandhi's associate, C.F. Andrews, as its first president, and profit-sharing schemes were brought in in 1934. Against this, it was argued that the Workers' Union operated in fact as a management tool to impose its will on a workforce so heterogeneous by nature that rival unions made little headway. Despite the reputation of the Tata family for concern over workers' rights, there was much unrest among the workforce during the 1920s over wages and conditions and it has been claimed that this, as much as anything, contributed to advances. The commitment of the Indian Trades Union Congress after independence to the same goals as central government--economic self-sufficiency and prosperity--allowed the Tatas a relatively free hand in dictating their own industrial relations policy. Whatever the arguments, TISCO could claim in 1989 that it had not lost a day's work through industrial action in 50 years, and its management illustrated its commitment to the welfare of its employees by commissioning an audit of its "social performance" by a team of eminent public figures. 174
TISCO's success spawned numerous offshoots making use of Tata products, some of them part of the Tata Group. These included the Tata Engineering and Locomotive Company (TELCO). This ripple encouraged other areas of Indian industry to become suppliers of spare parts for new products and by 1970 TELCO had more than 500 Indian ancillary suppliers. The second element in Jamsetji Tata's plan for India's modernization was the development of a hydroelectric capability. Within reach of Bombay's thriving, basically steam-driven cotton spinning industry lay the monsoon-swollen rivers of the western Ghats. If Bombay's captains of industry could be persuaded to invest in the necessary conversion from steam to electricity, the natural resources existed to provide this new source of power. To encourage the process, the Tatas bought up sufficient mills to create the necessary demand before launching Tata HydroElectric Power Supply Company in 1910. By 1915, the required dams and reservoirs, ducts, and pipelines had been laid to feed the new turbines. Two further power stations followed in 1916 and 1919. Between the wars the family had to sell some 50 percent of its stake in the hydroelectric company to a U.S. syndicate to support other less successful firms within the group. By the 1960s, power stations had been supplemented by four thermal installations, which together satisfied Bombay's entire domestic and industrial requirement. TISCO, TELCO, and Tata Hydro-Electric Power Company were only three parts of the Tata empire that by the late 1970s included 30 separate companies. Together the group accounted for 1.8 percent of India's GNP, with TISCO alone providing 0.4 percent, far more than any single equivalent firm in the United States or United Kingdom. In 1970, the managing agency system that had characterized much of Indian industry since the British period was abolished. Under this system, British investments in the subcontinent were managed by firms of agents who charged commission for their services. Tata Industries Ltd. acted in this capacity for many of the firms in the Tata Group, and until 1970, central control was not difficult. After this date, shares in the 30 or so Tata enterprises were retained by Tata Industries, whose chairman from 1938 was Jehangir Ratanji Dadabhoy Tata, a distant relative of the founder of the Tata industrial dynasty. He was succeeded in 1981 by Ratan Naval Tata, whose father had been adopted by Ratanji Tata's widow in 1917. Following the Monopolies and Restrictive Practices legislation of 1969, which represented the views of a government hostile to large private enterprises, 175
the Tata group was self-conscious within India about the size of its operation and great emphasis was placed on publicizing the independent nature of each of its firms. It was pointed out that 75 percent of the firms' shares was owned by trusts established by the Tata family to promote research and welfare projects. In reality, the Tatas had been adept in holding together their empire with a steady growth in the group's assets, much informal consultation between firms, a recurrence of names in the lists of directors, and a shared head office in Bombay. The continued prosperity of the group during the difficult postwar years for private sector firms was probably also helped by its refusal to take up an overtly political stance in opposition to prevailing government policy. The only exception was in 1956, when it backed the short-lived Forum of Free Enterprise against a government committed to assigning a dominant role to public sector industry. Government monopoly legislation also restricted diversification into high-profit areas such as fertilizers or pharmaceuticals, an obvious move for a group such as Tata whose traditional staple was high-cost, low-profit industry. There were no restrictions on overseas investment or new technology, however, and inroads into both these areas were made. India needed firms such as TISCO or TELCO if the country was to maintain a viable industrial capability. Therefore, even when government controls officially restricted growth, the Tata Electric Company was given the green light during the 1970s to build privately a new 500-megawatt plant, and sanction was given to TELCO to increase its output from 24,000 to 36,000 vehicles per year. TISCO developed as one of the independent but interrelated companies within the Tata group. Among the better known of these firms is the Indian Hotels Company, whose centerpiece, the Taj Mahal Hotel, in Bombay, was conceived by Jamsetji Tata and opened in 1913, as the first hotel in the country using electricity. Tata Chemicals was launched in 1939, and its Mithpur plant produced mineral extracts required for glass, ceramic, and leather production. The plant had a checkered history in its early years owing to delays in perfecting the soda ash process. With the support of the Tata group and the usual Tata resourcefulness in times of crisis, however, the company stayed in business. For example, when a drought in 1962 threatened to close the plant, management prevailed upon the local population to ration the domestic consumption of water. This "lakeless week" was a great success and ensured that sufficient supplies of water remained for the company to 176
continue in production. Another venture in 1962 involved joining with James Finlay and Company of Scotland to form the Tata-Finlay Company, which bought Finlay's 53 tea estates and has become the biggest tea producer in the world. In the field of electronics, Tata joined the Burroughs Corporation of Detroit in 1977 to market the U.S. firm's computer systems and to begin to develop the manufacture of mainframe computers in India. With such an array of experience and expertise, the group entered the consultancy market with the establishment of the Tata Consulting Engineering and Tata Economic Consulting Services. One Tata initiative that slipped through the net was air travel. An air service was inaugurated to carry the mail between Bombay, Karachi, and Madras in the 1930s. In 1946, however, Tata Airlines went public as Air India Ltd, and the company was nationalized in 1953 to form Air India and Indian Airways. The third requirement of Jamsetji Tata for a successful and independent India was a system of technical education. His scheme to launch a Science University in India in 1898 was opposed by the viceroy Lord Curzon as overambitious and inappropriate for Indian needs. Tata persevered, however, and offered to underwrite the project with an endowment derived from his Bombay properties. He did not live to see the scheme realized. After Curzon's departure, the government of India showed itself more amenable to the proposal, and in 1911, Bangalore was chosen as the site for an Indian Institute of Science with joint funding from the Tata family, central, and provincial governments. The institute produced a number of eminent scientists and became a focus for much pioneering research. Tata funds have gone into other projects such as the Bhabha Atomic Research Center in Bombay, which has developed techniques for more efficient power generation. One of Jamshedji's greatest legacies was a concern for creating better educational opportunities for his countrymen. By the 1920s, one in five of Indian recruits to the Indian civil service had benefited from Tata scholarships. This commitment to education, welfare, and other humanitarian projects continues today and is part of the Tata distinctiveness. TISCO, for example, took part in a Green Millennium Countdown program and planted 1.5 million trees. In 2001, it also supported the Lifeline Express program that provided healthcare to those living in remote areas. TISCO is also known for providing relief during natural disasters and was awarded the Outstanding Corporate Citizen Award from the Economic Times. 177
The Tata family was often accused of paternalism toward its workers, of an often ill-judged concern for the continued existence of every member of the corporate group irrespective of profitability, and of an over-concentration on traditional highcost but low-profit industries. TISCO, however, cut its workforce from 78,669 employees in 1993 to 48,821 in March 2001. The management culture of the group as a whole was changing in the new millennium. Tata directors were focused on profitable operations as well as securing leading industry positions for each Tata company. Since the abolition of the managing agency system in 1970, TISCO and the various Tata companies operated entirely independently, but they retained many personal, family, and business ties. TISCO and most of the larger firms in the "family" shared the same head office in Bombay. The Tata sense of identity survived a postwar period of almost continuous economic and political adversity. At the start of the new millennium, the Tata group included 80 companies involved in various industries including engineering, chemicals, energy, materials, consumer products, IT and communications, and services. TISCO Operations During the 1990s During the 1990s, TISCO was faced with trying economic times as it forged ahead with modernization and expansion. During the decade, the steel firm began its fourth stage of upgrades and improvements. As part of the modernization, TISCO planned to increase its annual steelmaking capacity in Jamshedpur to 3.2 million metric tons by 1999, up from 2.7 million tons in 1996. The steelmaker also broadened its geographic reach. In 1990, a U.S. subsidiary, Tata Inc., was established and the following year, the firm opened offices in Singapore and Dubai. It was during 1991 that restrictions on licensing, price, and distribution were lifted in India, allowing TISCO to expand its capacity. India also began allowing foreign manufacturers involved in such steel-dependent industries as electronics and automobiles to operate in the country. As demand increased, TISCO set plans in motion in 1995 to construct India's largest blast-furnace mill with an eventual annual capacity of ten million metric tons. By 1996, steel 178
consumption in India had grown by ten percent in each of the last four years. That year, TISCO expanded further and teamed up with Inland International Inc. to create Tata-Ryerson, a joint venture that would provide industrial materials management services in India. During the mid-to-late 1990s, however, India's steel industry and economic climate weakened. Many construction projects in the region were put on hold. As steel demand and prices fell, TISCO's profits plummeted. In 1998, the company reported a 61 percent fall in net income. As such, TISCO began aggressive costcutting measures and drastically cut its workforce. While most companies involved in the steel industry reported losses, TISCO was able to keep its bottom line in the black. Despite the trying economic conditions, TISCO was able to complete its $1.5 billion modernization program in April 2000. It began operation of a 1.2 million metric ton cold rolling mill and also became one of the lowest-cost producers of hot-rolled coils. During fiscal 2000, TISCO reported earnings of $90.1 million, an increase over $60.2 million earned in the previous year. In 2001, after 30 years of service, Jamshed Irani, TISCO's managing director, retired, leaving B.D. Muthuraman at the helm. Under a new director, TISCO pledged to continue cutting costs and focus on new growth areas such as making investments in the telecom industries. Although conditions in the steel industry remained uncertain and the economic climate in India remained unstable, TISCO appeared to be well positioned to handle the problematic environment. Principal Subsidiaries: Tata Refractories Ltd (51%); The Tata Pigments Ltd.; Kalimati Investment Company Ltd.; Tata Korf Engineering Services Ltd. (60.1%); Tata Incorporated; Stewarts & Lloyds of India Ltd.; Tata Technodyne Ltd.
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Tata steel (formerly TISCO) Company Perspectives: Consistent with the vision and values of founder Jamsetji Tata, Tata Steel strives to strengthen India's industrial base through the effective utilization of staff and materials. The means envisaged to achieve this are high technology and productivity, consistent with modern management practices. Tata Steel recognizes that while honesty and integrity are the essential ingredients of a strong and stable enterprise, profitability provides the main spark for economic activity. Key Dates: 1907: Tata Steel is established by Jamsetji Tata. 1924: On the brink of disaster, Sir Dorabji Tata pledges his personal fortune to secure bank loans to keep the company afloat. 1939: By now, TISCO operates as the largest steel plant in the British Empire. 1951: A Modernization and Expansion Program (MEP) is launched. 1955: The MEP is upgraded to the Two Million Ton Project (TMP). 1970: TISCO employs 40,000 people at Jamshedpur and 20,000 workers in neighboring coal mines. 1978: The Indian government forces TISCO into modernization efforts. 1989: The Tata Group doubles its stake in TISCO to thwart takeover attempts. 1990: TISCO begins expanding and establishes subsidiary Tata Inc. in New York. 1996: The company begins a joint venture with Inland International to build a steelworks facility in India. 1998: TISCO records a 61 percent decline in net income due to a downturn in the steel industry. 2000: TISCO completes a ten-year, $1.5 billion modernization program.
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Future Prospectus and Outlook Nano manufacturing at Singur to start in Q4 Tata Motors expects to start manufacturing of its much-hyped mini car Nano at Singur in the fourth quarter of this calendar year. The high volumes of Nano is expected to dramatically change Tata Motors’ market position, reach and visibility, said company chairman Ratan Tata in the latest annualreport. The Singur manufacturing facilities would be expanded to meet domestic and global demand in the future. Tata Motors, the country’s largest truck maker, is working on new variants of the world’s cheapest car Nano to overcome challenges posed by high fuel prices, which could negatively impact vehicle sales, Mr Tata said. Tata Motors has also started developing new variants of Nano to meet environmental and fuel price challenges, as also market requirements of several international markets. The move comes in the run-up to the scheduled roll out of the gasoline-powered Nano from Singur. Tata Advanced Internship Programme The Tata Advanced Internship Programme (TAIP), a Group-level summer internship programme, aims at garnering talent from premier international business schools in the United States and Europe as well as giving students an insight into the Group's ethos, work practices and business philosophy. It intends to bring in young management students from premier international business schools from USA and UK and build the Tata brand on campuses abroad. The programme is being managed by Tata Group HR with the support of Group companies where the candidates may be placed as summer interns. Selection of candidates and allocation of projects is based on their work experience, academic focus areas and areas of interest.
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Tata International Internship Programme In keeping with the Tata Group's globalization strategy, Group HR has initiated an international internship programme (IIP) that aims to give an opportunity to young undergraduates and postgraduate students from across the world to gain the Tata experience. Initiated in 2006, this Group level internship programme intends to bring in management students from international business schools and build the Tata brand on campuses abroad. Beginning with three of Singapore's leading universities — National University of Singapore, Nanyang Technical University, and Singapore Management University — the programme also collaborates with the Asian Institute of Management in Manila and the Peking University and Tsinghua University in Beijing. IIP Interns can be placed with any Tata Group company, based on their work experience, academic focus areas and areas of interest. K. Subramanya, COO, Tata BP Solar, discusses the Indian and global renewable energy industry, and the company's plans to tap potential markets Tata BP Solar, a joint venture between Tata Power Company and BP Solar, one of the largest solar power companies in the world, is determined to light up a great many lives over the next few years. Tata BP Solar chief operating officer K. Subramanya elaborates on plans of becoming a $300-million company by 2010, and how it is moving from strength to strength. Considering the fact that Tata BP Solar has established a name for itself not only in the domestic market but also internationally, has the company any investment plans with regard to production expansion, etc? Tata BP Solar has plans of investing over Rs 100 crore in 2006 in expanding its capacity. The company's track record has been very good so far and we have been growing at a rate of about 20-25 per cent every year. We hope to sustain this and want to be a $300-million company by 2010. 182
Right now we are at $100 million. The company is readying itself for the Tata Business Excellence Model process in the coming years. With regard to production capacity, we aim to have 43-MW solar cell manufacturing capacity in the near future. Right now our solar cell manufacturing capacity is about 16 MW. OUTLOOK
Group chairman Ratan Tata speaker on a wide range of issue concerning the Tata Group and its pace in a world changing dramatically than ever before what will be the nature ad scope of Tata Group engagement in the coming years with a world changing more rapidly than ever before. Here are numerous questions and who better to address and opportunities before the group as it continuous reinforcing and reinventing itself in India and in the world. Over the next five to seven years the group has to start looking seriously and strategically at creating brand awareness for ourselves in new business commercially and strategically in this region’s the group also says that in commodities the brand is not as important as it is in product. The group chairman Ratan Tata says that we are not promoting our one brand but we are getting serious of properties that have their one brand it can also happen with a company like Titan if you are willing to spend huge amount of money propagating the brand it will work.
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Succession planning Although Ratan Tata is 68 years old he look more like some who is in late 40’s/early 50’s the million dollar question on everybody mind is who will succeed Ratan Tata. Ratan Tata move is not seen to create any waves being more in the realm of a technical change. Mr. TATA can continue to be non-executive chairman of Tata sons till he is 70years old. Some goes for the position of chairman he holds at other Tata companies as well, a group official said. To oversee the conglomerate, a Group Executive Office(G.E.O) with executive directors was put in place some times back. It is guided by the highest policy forming body of the group, the corporate centre, a think-tank that brings together GEO directors and group seniors, including Mr. Tata. The change to Mr. Tata authority was best described by a senior official, likening it to a technical shift from a formal zone to an informal one.”All that is happening on 28th is that he ceases to be Executive Chairman, ” he said, citing as example the of Dr. J.J Irani, who on turning 65 stepped down as Managing Director, Tata Steel, continues to be a non-executive Director of Tata sons and is Chairman of Tata Teleservices. A common response across the group was that the late J.R.D.TATA was non-executive chairman for many years. So , it makes no difference, ”one official said. Thus December 28 does not by itself raise the spectra of a succession plan at Bombay House. There is time till December 2007,when Mr. TATA turns 70.The way insiders see it: Mr. Tata’s chairmanship is founded on grounds much stronger than his retention of executive authority. Taking over a collection of companies, some of them ruled by long-lasting fiefdoms, Mr. TATA’s central achievements was putting the glue back into the group. The Promoter’s stake in key Tata companies was increased and adherence for the Tata’s. Along the way, the group made solid advances with its old economy companies- Tata’s steel new cold rolled mill, Tata Engineering’s foray into cars
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and Tata Tea’s acquisition of the UK-based Tetley. Exits occurred, from the erstwhile Tata oil mills company, Lakme and Acc. slip-ups too happened, most publicized being the still unraveling mess at Tata Finance. But further on the upside, the Tata’s are now a leading role in telecom with the VSNL and Tata Teleservices, while infotech major Tata consultancy services is touted as a significant unlocking of value due in near future. Simply put ,Mr. Ratan Tata has a track record that finches respect with or without executive powers. Though he joined the Tata in 1962 , it was his appointment in October 1981 as chairman, Tata industries-the group’s holding company for new businesses-that pushed Mr. Ratan Tata centre stage. As he took over that post from J.R.D, he was seen to be a successor in the making. Coming Saturday, nothing like that is due at Tata Industries, if chairmanship there were indeed the accepted route to eventual succession at Tata sons. On the other hand, changes in management structure at the group’s apex –essentially the corporate center and GEO-could be interpreted as preparing the Tata’s for a time when its original family promoters are not so closely associated with the operations of the group, as at present. have the Tata then, adopted a structure, which can run without a Tata at the helm? There is no answer to this either.”It shows the extreme professionalism of the group at the highest level,” was all what one top official would say.
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OFFICE DYNAMICS SUCCESS PLANNING Workplaces have begun to look very different from the way they used to in the past-pastel colours, soft furnishings, open plans, piped music, attractive cafeterias, play and relaxation areas. In some BPO organisation, calendarised and hyped-up fun events run by dedicated section of the HR department from part of the employee engagement and retention strategy. Work teams are beginning to become diverse in terms of age, academic training and experience-and, yes most heartening, in terms of gender as well. There is much greater openness to having people in their in senior positions. Increasingly, people in the same workplace have different relationships with the organisation they are working for-some are employees, other are consultants, and others are vendors’ employees. Some of them are employed by a ‘temping’ organisation, while some work from home or only part-time. Many can come and go at different times of the day-times of their choosing. Among employees, some get paid more then others in similar roles, based on how the organisation values their knowledge, skills, experience, network, or potential. Employees are increasingly opting forretials. Instead, they are taking charge of their financial planning, exploring avenues such as mutual funds and stock markets more aggressively. They are going for insurance policies with varied features that suit their risk mitigation needs.The workplace of the future will only accelerate these trends. The interesting thing about the future is that a lot of it is already here in seedling form,in the form of fringe movements, ’videos’ and weak signals strengthen .The challenge for us is to know in advance which of these will in fact become significant realities in the future. The shape of things to come so, what sense can we make of future? I think people will increasingly make three demands: choice, flexibility and autonomy, in all aspects of their lives, including work. The work place of the future will strive to provide these for individuals-and in the process, l earn to cherish the values of commitment, consistency and co-existence.
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Choice and commitment will have to go hand in hand-each can exits only when the other does. Similarly, the world seems to be becoming more tolerant of multiplicity of views and approaches, yet seeking greater predictability and consistency. There will be as much value placed on diversity and spontaneity as on achieving sixsigma. Finally, empowerment and autonomy, signaling freedom from supervision, are leading employees to learn to temper their behaviors to align efforts with those they work with the changing demographics the world over and especially in India will mean that the ‘baby boomers’ of today will find the ‘genX’ and ‘genY’ opportunities to save which preoccupied the baby boomers we are seeing the search for opportunities to spend amongst the emerging workforce. Malls and multiplexes are bringing weak signals’ of the future of the work place.How will all this translate into the workforce? Here are few vignettes of what we might we walk into a workplace of the future: Greater focus on skills and capability, which will bring greater stress on what a person brings to the table, rather than who he/she is or has been in the past. Redefinition of employees-companies will have to maintain a fine balance between career planning and free agent ship a new work ethic. Focus on doing work that is enjoyable and meaningful to do. Multicultral workforce greater respect by individuals and organisations for individuality, local communities and natural surroundings. Diffusion of office space and work timings. You are likely to catch yourself messaging from home in the middle of the right to colleagues across the planet!End of steady jobs and fixed roles. We will see a transition from jobs-forlife to specific assignments. Markets will price assignments differentially meaning that people may move from higher paying to less paying to less assignments, while making other trade-offs. More teamwork at the same time, more work will get done by teams, rather than by individuals. Greater interdependence in work processes and less stand-alone work. People may have greater autonomy in their own work but will have greater inter-linkage and inter-dependence with the work of others.
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Fewer meeting!Many face-to-face interactions will be replaced by face-to-screen interactions-screens that will be touch-sensitive, glare-free, with life-like pictures and sounds. Intuitive machine-man interfaces that can be operated by speech and tactiles stimuli will become the vogue. Personalized work plans and performance goals, agreed with the superior, reviewed regularly, with a very serious focus on coaching along the way. This will be needed to ensure people get work they enjoy doing, and therefore stay on this will also be necessary for the rapid grooming of talent that will become imperative. End of the age of super-annotation and in fact, an end to the phenomenon of specifying lower and upper age limits for roles. More socially useful productive work for CEO’s. the challenge of social fracture as a consequence of economic and opportunity disparities will drive more recognition of the fact that ‘island’ of prosperity and well being cannot exits admist disenfranchisement, poverty and squalor. Many of the other forces will bring greater proximity of areas that could be ignored in the past like downtown neighborhoods and sub-saharan African or part of other societies, greater involvement of business leaders in managing social issues-heath care, insurance, quality of academic institution, school syllabi, infrastructure creation and maintenance, stronger partnerships. Access to capabilities will be seen as more important than ‘ownership’ of assets -people, factories, etc. Organisation and individuals will come together for mutual benefits in diverse kinds of relationship, depending on the value that needs to be created at the moment .The whole concept of a ‘workplace’ may become redundant as where people work and the place where their payment comes from could be completely different greater demand for privacy and protection of the individual accompanied by greater need for information on the individual by government, corporate and services related system-fears of ‘Big Brother Watching will get heightened. The challenge for large corporation to create the small-organization ethos will continue to seem daunting, despite the extensive use of communication technology. This will spur the emergence of an ‘empowered middle manager’ of a different kind, and corporate roles of coordination and enabling of a less intrusive and directive kind. 188
Greater transparency and openness around business policies, including those related to employees. Greater courage to question them by one and all such courage will be encouraged due to its salutary effect on corporate intelligence about business issues of the organisation they work for all this could sound be wilding to some and exhilarating to others. To me the future has potency, challenge and ,most fascinating of all, space for the eternal paradox of predictability and unpred-ictability.so welcome to our worst nightmare and our best dream all into one! welcome to the workplace of tomorrow. The world is my office S Padmanabhan, executive vice president and head, Global human resourses, TCS. Boundaries in the business world are increasingly dissolving. As delivery move around the world are increasingly dissolving. As companies move around the world setting up offices, services delivery centers and manufacturing hubs, there will be an even forward. The globalization of the workforce will have a far-reaching impact on every aspects of human resources. Processes, policies and system will have to evolve and challenge according to the region or country. But the biggest challenge we face is integrating this global workforce. For the Tata Group, acquisition have become a way of life and handling integration issues has become a way of life and handling integration issues has become a critical function of HR departments. In international acquisition, we have to deal with different nationalities, regulatory issues and even the tensions of being acquired or merged. There are also many soft issues involved with integrating the management, the workforce, and business practices. Earlier at TCS, foreign nationals formed less then one per cent of the workforce with over 62,000 associates from 53 nationalities, the company is emerging as a true global firm with a diverse employee base. We have found that the best way of assimilating them into TCS’s culture is to have them work on projects together with our people both in India and outside while recruiting internationally, we need to respect the local legal norms, cultures and attitudes. That has been the learning at TCS. We need to understand what is relevant to people in different societies, and change our pitch to suit local contexts. For instance, Indians love to travel and work abroad,
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but in ways other countries people like to work in their own town city. So we need to focus on their roles and targets in TCS rather than the opportunity to work in different geographies. Work-life balance today it is very fashionable to ask,” Do you have a work-life balance?”But this is a choice people have to make. A company cannot dictate or regulate it by switching off lights at 5 pm or ask employees to go on a picnic. What companies can do is to faster a productive work environment within the working days. If employees need to work outside, then this should be facilitated though the internet and mobile phones. I feel we should give more opportunities for people to work outside, then this should be facilitated though the internet and mobile phones. I feel we should give more opportunities for people to work from home if they want to and make work more flexible. So it may not be necessary that the entire workforce of TCS comes to office every morning at the same time. Such an approach will also cut down on commuting time and enable employees to spend more time with their families. Work-sharing is another way in which couples. or any two people, share the work. All this would not mean less productivity but result in happier employ at TCS we are creating opportunities for employees ‘ ‘families to understand what is happening in the company. This gives them a sense of pride in the work that the spouse or parent is doing and makes them feel less neglected. The issue of work-life balance is going to become bigger future. We have start looking at the work environment very differently from the way we do today. In all this companies need to look at certain regulatory requirements in different countries. People should not lose out on benefits such as superannuation and gratuity because employment laws do not permit these for part-time employees. We will need to consider some structural changes in policies and people practices attracting and retaining employees compensation has been, and will continue to be, the big driver in retaining people. But I feel the importance of money varies at different stages of life and in different roles that people play.
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Once people reach a minimum level of compensation, what matters to them are their aspiration-and this is where role planning and the work environment are critical. Goals and targets need to be clear so that people can know what they are going to do and they have achieved. These two rules have been in focus for last 25 years of my life and they will continue to be important. It’s also universally true that people join companies but work with bosses and equally true, people leave bosses; not a company. What people will also look for is a comfort level that they have a good job to do in the company. A company needs to create a good employer brand, internally as well as externally, by ensuring that people have good jobs which make them feel proud of working for the organisation. After that, depending on the demography and age of the person, companies need to add certain benefits that create a social status for the person, give him or her recognition outside the company .People want their place under the sky. Employees can be given opportunities to make presentations at international forums, or made members of academic institutes or industry associations this will increase retention. It is increasingly evident that people are reaching higher, faster. So where do you go when you approach the top? A company can take you only so far in your personal ambition and growth. After that the company should allow you to move to an internal or external company. In this respect, the TATA GROUP has a phenomenal advantage. TATA have more than 90 companies, there is a good opportunity for mobility in groups. Helping them to grow outside the Group is also good because if that process is well managed, you have a wider populace as a friend- because if the leader (in another company) is your friend, the others will align with the leader. For the Group, the TATA brand will continue to be a magnet for people looking for a job. In the Indian ethos there is a certain value attached to the TATA.
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Brief on the Stalwarts and their role in shaping the Business house For the Tata family of people and companies, the year gone by was a call to remembrance as much as it was a time for achievements and accolades Theyear 2004 was momentous for the Tata Group in more ways than one, marking as it did the death centenary of Group founder Jamsetji Tata, the birth centenaries of two other stalwarts, JRD Tata and Naval Tata, and a slew of achievements by Tata companie in various industry sectors. Among the many activities undertaken to commemorate theCentury of Trust initiative in memory of the three Tata titans was a travelling exhibition, a business quiz competition, an advertising campaign and the publication of Lasting Legacies, a special edition of Group magazine Tata Review. The following is an encapsulated recap of the strides that the Tata Group and its major companies took in the year gone by. Products and services Tata Group companies continued to respond to the needs of its customers and clients with agility while launching a variety of new products and services: •
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Tata Motorshad a bunch of significant launches this year. It introduced the New Indica V2, the Indigo Advent, the Indigo Marina and the Sumo Victa. It also launched the Indica and Indigo in South Africa. In May,Tata Asset Management launched its Tata Equity P/E Fund, which identifies suitable investment opportunities by analysing undervalued stocks on the basis of price-to-earnings ratio. In June,Indian Hotels launched indiOne, its smart basics hotels in an innovative attempt to redefine the hospitality landscape with a new category that is comfortable yet affordable. In September, it opened India's first luxury homes complex, Wellington Mews, in Mumbai. In November, the company launched theTaj Exotica Resort and Spa in Mauritius. This property is spread over 27 acres on Wolmar Beach and laps the turquoise waters of Tamarin Bay.
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In July,Titan touched a new milestone in creativity by launching Flip, India's first dual-face watch, with dual functionality and styling. In September,VSNL announced the launch of Tata Indicoms global calling card, which allows Indians travelling abroad to make calls to India or any other international destination from any mobile, landline or pay phone. In October, Tata Chemicalslaunched Tata Kisan Sansar, a chain of one-stop resource centres for farmers that offer end-to-end agricultural solutions. In November,Tata Teleservices became the first company in the Indian telecom market to launch Push-To-Talk services, which allow customers to call a group of people at one time by simply pressing a button. In December,Tata AIG Life unveiled operation quantum leap, an aggressive business growth strategy for the next three years. It has set its sights on becoming a top player in the private insurance sector and on securing a market share of 20 per cent by 2007.
New partnerships Many Tata companies forged new alliances and grew through acquisitions: These are some of the noteworthy developments on this front: •
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In August, Tata Steelacquired NatSteel, the dominant steel producer of Singapore, for Rs 1,313 crore. This was part of the companys quest to increase its global footprint. Tata Motors acquired South Koreas second largest heavy truck maker, the Daewoo Commercial Vehicle Company. The new entity then went on to launch a heavy duty truck model, Novus, in the South Korean market. In November, VSNL acquired Tyco Global Network, among the worlds most advanced and extensive submarine cable systems, for $130 million. In March, purchased Chennai-based Dishnet DSLs internet service provider division for Rs 270 crore.
Hitting the headlines Tata companies made news throughout 2004 in different ways. Here are some highlights: •
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Tata Projects, now a leading company in the field of power generation, transmission and distribution, and in civil infrastructure projects, celebrated its silver jubilee in February. Voltas, the refrigeration and air-conditioning giant, is celebrating the fiftieth year of its existence. Tata Racing, which has been supporting Narain Karthikeyan, the fastest Indian in the world, added the promising Karun Chandhok to its stable of racing drivers in April. In May, Tata International, the international business gateway of the Tata Group, joined the billion dollar club with a 22-per cent rise in turnover. On July 29, the birth anniversary of late Tata Group chairman JRD Tata, software giant Tata Consultancy Services made its foray into the with an initial public offering. The issue was a roaring success, stock markets being oversubscribed seven times over. The year also saw the company providing infotech solutions and engineering services to Formula One racing carmaker Ferrari. In September, Tata Motors became the first company in the Indian engineering sector to list its securities on the New York Stock Exchange. In October, Titan announced that Indian film idol Aamir Khan would be its brand ambassador. In November, VSNL launched the Tata Indicom Cable, Singapores first fully Indian-owned undersea fibre-optic cable. This cable system will increase the existing bandwidth capacity into India.
Early life Jamsetji Tata was born to Nusserwanji and Jeevanbai Tata on 3 March 1839 in Navsari, a small town in South Gujarat. Nusserwanji Tata was the first businessman in a family of Parsi Zoroastrian priests. He moved to Bombay and started trading.
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Jamsetji joined him in Bombay at the age of 14 and enrolled at the Elphinstone College. He was married to Hirabai Daboo[2] while he was still a student.[3] He graduated from college in 1858 and joined his father's trading firm. It was a turbulent time to step into business as the Indian Rebellion of 1857 had just been defeated by the British government. Legacy The company started by Jamsetji Tata came to be known as the Tata Group and is today among the largest and most respected companies of India. Jamsetji, was however, known for much more than just starting a company. He was a pioneer in his field and thought way ahead of his times. When he started the Empress Mills in Nagpur, he didn't just think of novel ways to manufacture textiles, he also put in place very good labour practices. This was long before any labour laws came into existence. Though India remained under British rule while he was alive, he interacted with activists such as Dadabhai Naoroji and Pherozeshah Mehta. He was strongly influenced by their thinking. However, he always maintained that political freedom must be accompanied by economic self sufficiency. Not only did he manage to create thousands of jobs, he paved the way for many future enterprises. The establishment of Indian Institute of Science was initiated by him. Jamshedpur, also known as Tatanagar, a city in the Indian state of Jharkhand is named after him. The Tata Group has many facilities there, including Tata Steel.
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Jehangir Ratanji Dadabhoy Tata (July 29, 1904–November 29, 1993) was a pioneer aviator and important businessman of India. He was awarded Bharat Ratna during his life time. Early life J.R.D. Tata was born in Paris, France, the second child of Ratanji Dadabhoy Tata and his French wife Suzanne Brière[citation needed]. His father was a first cousin of Jamsetji Tata, a pioneer industrialist in India. 'Jeh', or 'JRD' as he was commonly known, came to be regarded as the most famous industrial pioneer in modern India. As his mother was French, he spent much of his childhood in France and as a result, French was his first language. Tata also attended the French Foreign Legion. He attended the Cathedral and John Connon School, Bombay (now Mumbai). J.R.D. Tata was inspired early by aviation pioneer Louis Blériot, and took to flying. In 1929 Tata got the first pilot license issued in India. He later came to be known as the father of Indian civil aviation. He founded India's first commercial airline, 'Tata Airlines', in 1932, which in 1946 became Air India, now India's national airline. Businessman J.R.D. Tata studied engineering at the University of Cambridge. He did not continue beyond matriculation as mentioned in his biography, by Mr R M Lala. At the age of 34, he became Chairman of Tata Sons, the holding Company of the Tata Group. For decades, J R D directed the huge Tata Group of companies, with major interests in Steel, Engineering, Power,Chemicals and Hospitality. He was famous for succeeding in business while maintaining high ethical standards refusing to bribe politicians or use the black market. Under J R D's Chairmanship, the number of companies in the Tata Group, grew from 15 to over 100. Monetarily, the assets of Tata group grew from Rs 62 crores to over Rs 10000 crores. He was awarded the Legion d'honneur, by the French Government in 1954. He also received the prestigious Guggenheim Medal for aviation in 1988. He was awarded the Bharat Ratna, India's highest civilian award in 1992 for his service to industry 196
and nation building. He died in Geneva, Switzerland in 1993 at the age of 89. He is buried at Père Lachaise Cemetery in Paris. Naval Hormusji Tata: The People's Person Born in August 1904, Naval H. Tata joined the Tata Group in 1930, and by 1933 he was the secretary of the Group's Aviation division. In 1939 he was made the Managing Director of the Group's textile companies and in 1941 was made the Director of Tata Sons. Mr. Naval Tata was actively engaged with the Tata Charities and served as the Chairman of the Sir Ratan Tata Trust from 1965 to the time of his passing. He was the founder President of the Indian Cancer Society and held the position from 1951 through 1989. His most valuable contribution outside of business was in the domain of labor relations. He believed in responsible negotiations between employers, workers and governments in the search for equitable solutions to labor issues. For over four decades he provided a voice of reason, consideration and conciliation to national and international organizations working to minimize employer-employee friction. He was an employer who always regarded himself as a trustee of the rights and interests of workers. Mr. Naval Tata became part of Geneva-based International Labor Organisation governing body in 1951 and continued in the post till 1989. He was also a member of the International Organisation of Employers for 38 years and was the president of the Employers' Federation of India from 1959 to 1985. Naval Tata symbolized all that is best of the Tata spirit of giving back to society and the communities in which its enterprises grow. He was also an avid sports lover and Indian field hockey was another beneficiary of his capabilities. He was the administrative head of the game in India when the country won gold in three successive Olympics. Mr. Naval Tata's caring and endearing nature, his abiding concern for the poor, his love of a good laugh and his instinct to trust even those not worthy of it, made him one of a kind. He married Simone in 1955. Mr. Naval Tata passed away in 1989. 197
Ratan Naval Tata Ratan Tata was born into the wealthy and famous Tata family of Mumbai. He was born to Soonoo and Naval Hormusji Tata, a Gujarati-speaking Parsi family. Ratan is the great grandson of Tata group founder Jamsetji Tata. Ratan's childhood was troubled, his parents separating in the mid-1940s, when he was about seven and his younger brother Jimmy was five. His mother moved out and both Ratan and his brother were raised by their grandmother Lady Navajbai. He was schooled at the Campion School, Mumbai and graduated from Cornell University in 1962 with a degree in Architecture and Structural Engineering. Ratan joined the Tata Group in December 1962, after turning down a job with IBM on the advice of JRD Tata. He was first sent to Jamshedpur to work at Tata Steel. He worked on the floor along with other blue-collar employees, shoveling limestone and handling the blast furnaces.[1] Ratan Tata, a shy man, rarely features in the society glossies, has lived for years in a book-crammed, dog-filled bachelor flat in Mumbai's Colaba district.[2] In 1971, Ratan was appointed the Director-in-Charge of The National Radio & Electronics Company Limited (Nelco), a company that was in dire financial difficulty. Ratan suggested that the company invest in developing high-technology products, rather than in consumer electronics. J.R.D. was reluctant due to the historical financial performance of Nelco which had never even paid regular dividends. Further, Nelco had 2% market share in the consumer electronics market and a loss margin of 40% of sales when Ratan took over. Nonetheless, J. R. D. followed Ratan's suggestions. From 1972 to 1975, Nelco eventually grew to have a market share of 20%, and recovered its losses. In 1975 however, India's Prime Minister Indira Gandhi declared a state of emergency, which led to an economic recession. This was followed by union problems in 1977, so even after demand improved, production did not keep up. Finally, the Tatas confronted the unions and, following a strike, a lockout was imposed for seven months. Ratan continued to believe in the fundamental soundness of Nelco, but the venture did not survive.
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In 1977, Ratan was entrusted with Empress Mills, a textile mill controlled by the Tatas. When he took charge of the company, it was one of the few sick units in the Tata group. Ratan managed to turn it around and even declared a dividend. However, competition from less labour-intensive enterprises had made a number of companies unviable, including those like the Empress which had large labour contingents and had spent too little on modernisation. On Ratan's insistence, some investment was made, but it did not suffice. As the market for coarse and medium cotton cloth (which was all that the Empress produced) turned adverse, the Empress began to accumulate heavier losses. Bombay House, the Tata headquarters, was unwilling to divert funds from other group companies into an undertaking which would need to be nursed for a long time. So, some Tata directors, chiefly Nani Palkhivala, took the line that the Tatas should liquidate the mill, which was finally closed down in 1986. Ratan was severely disappointed with the decision, and in a later interview with the Hindustan Times would claim that the Empress had needed just Rs 50 lakhs to turn it around. In 1981, Ratan was named Chairman of Tata Industries, the Group's other holding company, where he became responsible for transforming it into the Group's strategy think-tank and a promoter of new ventures in high-technology businesses. In 1991, he took over as group chairman from J.R.D. Tata, pushing out the old guard and ushering in younger managers. Since then, he has been instrumental in reshaping the fortunes of the Tata Group, which today has the largest market capitalization of any business house on the Indian Stock Market. Under Ratan's guidance, Tata Consultancy Services went public and Tata Motors was listed on the New York Stock Exchange. In 1998, Tata Motors introduced his brainchild, the Tata Indica. On January 31, 2007, under the chairmanship of Ratan Tata, Tata Sons successfully acquired Corus Group, an Anglo-Dutch steel and aluminum producer. With the acquisition, Ratan Tata became a celebrated personality in Indian corporate business culture. The merger created the fifth largest steel producing entity in the world.
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Ratan Tata's dream fulfilled, His Tata Nano Car 2008
Ratan Tata's dream was to manufacture a car costing Rs 100,000 (1998: approx. US$2,200; today US$2,528). He realized his dream by launching the car in New Delhi Auto Expo on January 10, 2008. Three models of the Tata Nano were announced, and Ratan Tata delivered on his commitment to developing a car costing only 1 lakh rupees, adding that "a promise is a promise," referring to his earlier promise to deliver this car at the said cost.Recently when his plant for Nano production was obstructed by Mamta Banerjee(plant was shut down for 2 weeks,its first car for use in the market will be delayed by a couple of weeks), his decision of going out of West Bengal was warmly welcomed.This would affect the image of West Bengal in rest of India and abroad as well.Although, Industrialization in West Bengal is only supported by CM Budhadeb Bhattacharjee.The final decision is yet to come. On March 26, 2008, Tata Motors, under Ratan Tata, bought Jaguar & Land Rover from Ford Motor Company. The two iconic British brands, Jaguar and Land Rover, were acquired for £1.15 billion ($2.3 billion). On October 7, 2008, After a controversial stay in West Bengal, Ratan Tata and his men on Tuesday shifted their Rs 1-lakh car Nano project to Sanand near Ahmedabad at an investment of Rs 2,000 crore (Rs 20 billion), delcaring that efforts will be made to roll out the world's cheapest car from a make-shift plant to meet the deadline. Praising Modi for speedy allocation of about 1,100 acres of 200
centrally located land, Ratan Tata said that the company had a great deal of urgency in having a new location and was driven by the reputation of the state.
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CONCLUSION Since the opening of the Indian economy in 1991, Tata has been subject to global competition, making it imperative for the group to become competitive in India against the new entrants. To gain scale, reduce their exposure to the cyclicality of India’s economy, survive, and achieve a sustainable competitive position in industries that are globalizing, most Tata companies then looked overseas. Tata’s recent experience is an excellent case for analyzing ‘accelerated internationalization’ (Matthews 2002). As it pertains to a challenger conglomerate from formerly peripheral areas that goes international in order to access resources, the Tata group has been driven by multiple factors, including the need to access new markets (e.g., in BPO services), the opportunity to integrate the value chain (e.g., in steel), and the quest for brand control (e.g., in tea). This strategy proved feasible because Tata possesses strong leadership combined with vision; can exploit the possibility of leveraging increasingly developed financial markets in India, a large domestic market, and global liquidity; and reacted fast to the opening of specific opportunities at given times. The process of growth, especially when it takes form through international acquisitions, has considerable consequences on the nature of corporations, their internal characteristics, and their relationship with stakeholders. Changes take time to unravel and loops may originate whereby target companies pass their DNA to the acquirer and modify the latter’s basic features. Such transformational dynamics is likely to be more complex in the case of emerging economies’ multinationals. On the one hand, these companies may use acquisitions in order to access resources they do not have, rather than to deploy un-imitable ones in the way that is predicted by the standard models of traditional multinationals. On the other hand, for this very reason emerging economies’ multinationals are likely to conclude their deals in more developed economies, where firms are not very amenable to adopt management methods and values developed in poorer countries. Operating across borders and time zones and integrating diverse management teams and corporate governance practices do not seem to have modified the Tata imprinting. Of particular interest is the fact that Tata has not blindly embraced ready-made recipes to face the challenges of multinational management, preferring instead organizational solutions aimed at fostering mutual recognition and knowledge exchange within the multinational conglomerate. A praise for this way of managing the group came from Standard & Poor’s, which in December 2006 expressed the view that the “policy to support its companies and the improved financial profile of its entities also enhances the overall financial flexibility of Tata 202
Motors.” In the case of VSNL, a strategic link with TCS has given the advantage of offering customers a single partner option that can deliver a combined IT and telecom solution. Another Tata advantage is the fact of being run by a very successful minority, the Parsis, without stirring anger amid the majority of the population (as is tragically common in other countries, see Chua 2002). This gentle approach may distinguish Tata from counterparts that produce much noise in their expansion. The process of internationalization of large corporations from non-Western countries – be they in some kind of East like China, India, or Russia, or in some kind of South like Latin America, South Africa, or Turkey – is more than a passing fashion. Future research will inevitably focus on detailed case studies of key firms, to analyze a broad variety of issues, from management practices and industrial relations, to the organization of R&D function and innovation. Mimicking the trajectory of the history of industrial nations’ business, the issue of hybridization – i.e. the process whereby corporate models, far from converging on a single model, take multiple and diverging roads to innovate and become increasingly open to the global economy – will figure prominently in the research agenda. This paper has offered a first modest contribution in this direction, especially in analyzing the time and geographic dimensions of diversification.
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BIBLIOGRAPHY
Our mentors provided a lot guidance but apart from this we took help from these sources.
MAGAZINE
NURTURING IDEAS – DRIVING GROWH BUSINESS WORLD INDIA TODAY
NEWSPAPER
FINANCIAL EXPRESS BUSINESS STANDARD TIMES OF INDIA
WEBSITE
www.google.co.in www.tata.com
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