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What makes them tick
With 95 companies and more than 2.25 lakh employees,
Tatas is not just India's oldest, largest and best known
conglomerate, but is one of the most professional groups
in the country. The Tata Group today encompasses businesses
in sectors as diverse as Engineering, Materials, Energy,
Chemicals, Consumer Products, Services, Communications
& Information Systems, Metals, Automobiles, Finance,
International Operations and Agro Industries.
At the turn of the century, Jameshedji Tata had identified
steel, hydroelectric power and higher education as the
core areas of strength. Over the years, every field
with potential for promoting national growth was explored
by the Tatas. The emphasis was on building not just
assets but internal resources for the nation. The Tatas,
thus, succeeded in inculcating a new paradigm for growth
and as a result infused a new business culture. A culture
that is committed to giving value for money as well
as to the practice of good corporate citizenship. Social
concern has been a prime motivator, as the Tatas believe
that the community is the stakeholder.
Tata's Vision:
Now, at the helm of this conglomerate, is Ratan Tata,
Chairman of the Group, and India's industrial architect.
Ratan Tata long had designs on modernizing the Tata
Group. He has been responsible for masterminding the
strategy that has refocussed and restructured the country's
largest conglomerate. Over the last 10 years, he was
able to turn a loose confederation of companies, controlled
zealously by powerful satraps, into a group that thought
and acted like one.
He has rediscovered his entrepreneurial roots and is
planning ahead to push into emerging business sectors.His
blueprint for future growth is:
Globalize:
With economies opening up, Tata companies are aiming
for global benchmarks to compete. |
Be
Skill-Intensive:
With manufacturing ceasing to be India's advantage,
the thrust is on knowledge-based industries. |
Build
Brands:
Shift from selling commodities to marketing branded
products and services that not just differentiate
but fetch a premium. |
Leadership:
To justify shareholder interest, Tata companies
must be among the top three in their industries. |
Enhance
Performance:
Executives must pull their weight, and the
best of them must get opportunities across functions
and group companies. |
Push
Growth:
Double revenues every four years, and net profits,
every three. Size matters. |
Tatas by the Numbers:
Since his takeover in 1991, Ratan Tata has quietly entered
15 new businesses and exited 11 and managed to herd
the rebellious Tata companies into a cohesive group.
| Despite Sell-offs... |
|
Businesses Exited
|
Buyer |
Value
Realized (Rs crore) |
| Cosmetics
(Lakme) |
HLL |
256.0 |
| Pharma
(Merind) |
Wockhardt |
42.3 |
| White
Goods (Voltas) |
Electrolux |
230.0 |
| Cement
(Tata Steel) |
Lafarge |
550.0 |
| Taper
Bearings (Tata Timken) |
Timken |
120.0 |
| Cement
(ACC) |
Gujarat
Ambuja |
950.0 |
| Paints
(Goodlass Nerolac) |
Kansai |
98.6 |
| UPS
(Tata Liebert) |
Emerson |
77.0 |
| Oil
Drilling (Hitech Drilling) |
Aban
Lloyd |
77.6 |
| IT/Telecom
Hardware (JVs with Tata Industries) |
JV
partners Lucent/IBM |
325.0 |
|
| ...and diversifications... |
| Businesses
Entered/Acquired/Expanded |
Investment
(Rs crore) |
| Auto
Components (Taco) |
150 |
| Passenger
Cars (Tata Engineering) |
1,700 |
| Retailing
(Trent) |
120 |
| Cold-Rolled
Steel (Tata Steel) |
1,600 |
| Captive
Power Units (Tata Power) |
1,860 |
| Hotels
(Indian Hotels) |
500 |
| Tetley
(Tata Tea) |
1,890 |
| Internet
Services (Tata Industries) |
65 |
| Insurance
(Tata AIG) |
250 |
| Telecom
(Tata Teleservices / Cellular) |
1,170 |
| Telecom
Infrastructure (Tata Power Broadband) |
500 |
| Assorted
Financial Services (Tata Finance) |
100 |
| CMC
(Tata Sons) |
152 |
| VSNL
(Tata Sons & Others) |
1,439 |
| TOTAL |
11,496 |
|
| ...the group is still manufacture
intensive |
| |
Total Income
(Rs crore)
|
PAT
(Rs crore) |
| Engineering
(Tata Engineering, Tata Communication, Tata
Autocomp Systems) |
11,428.0 |
-523.5 |
| Materials
(Tata Iron & Steel, Tata SSL, Tata Sponge
Iron) |
9,315.0 |
563.1 |
| Energy
(Tata Power Co, Tata BP Solar) |
3,813.8 |
396.7 |
| Chemicals
(Tata Chemicals, Rallis India) |
2,862.7 |
140.8 |
| Consumer
Products (Tata Tea, Tetely, Titan Industries) |
4,543.6 |
24.7 |
| Services
(The Indian Hotels Co, Tata AIG General Insurance,
Tata Finance) |
4,498.8 |
-226.7 |
| Comm
& Information Systems (Tata Consultancy
Services, Tata Teleservices, Tata Infotech) |
4,828.8 |
723.1 |
| TOTAL |
41,290 |
1,098 |
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The endeavor towards being India's most trusted business
enterprise has been the soul of the Tatas for over a
century. It is also the guiding spirit that will carry
the house into the next century and even further.
Recently, the redoubtable Ratan Tata was awarded the
Outstanding Businessman of the Year award by
the Mumbai-based Indian Merchant Chamber. Earlier he
had won the National Award for Excellence in Corporate
Governance and just last week he bagged the Asia
Pacific Award for Community Building.. As the citation
noted, Tata not just runs one of the biggest and most
professional groups in the country, but he also has
managed (God knows how) to keep the legendary Tata values
alive.
Source: Business Today
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