Case Title: Tata Nano: Host to a Global Dream

Q:1 To analyze the reasons behind the upsurge in the market for small cars.

Better Mileage

One of the biggest advantages of smaller cars is their smaller engines. While they might not be
powerful enough to pull a trailer, they more than make up for it in better economy and
efficiency. Many hatchbacks get upwards of 35 or 40 miles per gallon, making them perfect
commuter cars or city runabouts.

Better Performance for Price

One of the biggest advantages of small cars is that they generally offer a very good price-to-
performance ratio. Small cars handle well and accelerate and brake quickly, claims that many
larger SUVs and trucks can't make. And considering that they're often thousands less in price,
this improved performance doesn't affect your bottom line at all.

Safety

For a long time small cars in America had a reputation for being unsafe. Today, however, that
reputation couldn't be falser. Small cars and hatchbacks are subject to the same crash testing and
reporting as much larger vehicles, and their ratings represent how safe they really are. Many
small cars have four-star crash ratings and above, making them every bit as safe as mid-size and
large trucks and SUVs in most collisions.

B: To develop an insight into Tata motor's initiative to develop the cheapest car for the
global automobile consumer.
Increase sales: Generally international expansion is not easy as it may sound since many factors
have to be taken in to account. For example Tata motors started from India with an international
view but faced problems like political new country’s legislation and laws. For example Nano’s
launch in October maybe delayed due to political issues related to plant land. Reference Free
research report for 1Q 09 results. It should be taken in to account that Plant of Tata motors in
India would be much more cost beneficial rather than a plant in Europe as there would be a
difference in minimum wage laws. So to decide where a plant should be built lot of thinking is
required. Economic factors were also taken in to account, since different countries would have
different per annum income of the people hence to produce cars that would be affordable.

Product:

. Tata Motors provide many innovative features to attract car lover. One of these innovations is
the Tata Safari 4X4 Decor that has “Reverse Guide System”. A weather-proof camera is fixed to
the rear car to help the driver while reversing the car.

Pricing strategy:

Giving discount every month and special promotion for certain type of vehicle also one of the
strong strategy use by Tata Motors. Discount can be made from Company’s profit or from
dealer’s profit at certain range.

Place: Tata Motors has an extensive dealer network covering Indian and International markets.
Wherever you are, there is a Tata Motors Sales and Service dealership close to you

Promotion:

Sales promotion is a short term incentive to encourage the purchase or sale of a product or
service. Its purpose is to supplement and coordinate advertising and personal selling. It is
designed to persuade consumers to purchase immediately by providing special incentives to them
for example extra product, prizes or gifts. During festivals such as Diwali customers are given
festive discounts.

C: To debate if the Nano had the potential to claim the global market in terms of price and
quality.

1. Safety problems of car:

Because of low price of car the company was not able to give a strong security backup .so this
car was lack of safety , the car was strong enough in comparison of others .so this is also an issue
that they face because they launched the car at very low price and in that price they couldn't offer
the strong security backup.
2.looks factor: The tata nano car was very small in size and didn't look like the luxury cars and
in that price, they also couldn't offer the model like other luxury models of car .so this was also
the reason that were facing that was its very normal and non- stylish looks..

4. Case Title: PepsiCo: Breeding Reverse Innovation in India.

Tasks:

A: To understand the changing role of emerging economies as drivers of innovation for

MNCs and discuss the emerging concept of reverse innovation and innovation strategies of
MNCs.

The purpose of innovation is to come up with new ideas and technologies that increase
productivity and generate greater output with the same input. If we look at
the transformation of the US, once a largely agrarian economy that advanced from emerging
nation status in the mid-19th century to an industrial economy by the First World War, we can see
that the agricultural innovations and inventions were actually one of the largest factors that
helped bring about the Industrial Revolution. Vast improvements in agricultural productivity had
already previously transformed the way people work in Europe, releasing farmers for other
activities and allowing them to move to the city for industrial work. The shift from hand-made to
machine-made products increased productivity, directly affecting living standards and growth.

Reverse innovation is the process whereby goods developed as inexpensive models to meet the
needs of developing nations, such as battery-operated medical instruments in countries with
limited infrastructure, are then repackaged as low-cost innovative goods for Western buyers. The
process of reverse innovation begins by focusing on needs and requirements for low-cost
products in countries like India. Once products are developed for these markets, they are then
sold elsewhere – even in the West – at low prices which creates new markets and uses for these
innovations.

Innovation strategies of MNCs: Generational innovation = Intermediate phase where both

market and technology are going through continuous changes.
Radical innovation = Fundamental changes that represent revolutionary changes in technology.
They represent clear departures from existing practice.

Incremental innovation = Other changes which are insignificant, minor, or do not involve a
sufficient degree of novelty.

B: To understand the expansion of PepsiCo’s product profile over the decades and the way
R&D has been organized and reorganized and how the organization structure has been
adapted.

Pepsi has been repeatedly criticized by environmentalists for its relationship to

negative environmental impacts of agriculture in its supply chain, such as palm oil-related
deforestation and pesticide use, its use of water resources, and the negative impacts of its
packaging. PepsiCo’s R&D organization is comprised of experts that drive science, technology
and innovation thought leadership, allowing R&D to deliver on today’s business and market
priorities, as well as the sustainable growth opportunities of tomorrow.

PepsiCo’s case, the organizational structure enables control over the expansive reach of the
company around the world, considering significant differences among market conditions.
PepsiCo’s organizational structure’s characteristics are based on the company’s approach to
maximize its control of the business while continuing to grow internationally.

PepsiCo’s strategies are also manifested in how its organizational structure supports international
growth. A firm’s organizational structure defines the system and design of business components,
and how these components interact to fulfill the firm’s mission and vision. PepsiCo’s
strategies are also manifested in how its organizational structure supports international growth. A
firm’s organizational structure defines the system and design of business components, and how
these components interact to fulfill the firm’s mission and vision.

C: To discuss about PepsiCo’s reverse innovation and analyze how India became an
innovation hub.

Global soft drinks and snacks major PepsiCo today said its innovations in India are being
adapted for the firm's other international markets with the products gaining interest from
overseas.
Snacks like Kurkure and Aliva, and lemon-flavoured drink Nimbooz are some of the successful
innovations in India that have attracted attention from outside. Global soft drinks and snacks
major PepsiCo today said its innovations in India are being adapted for the firm's other
international markets with the products gaining interest from overseas. Snacks like Kurkure and
Aliva, and lemon-flavored drink Nimbooz are some of the successful innovations in India that
have attracted attention from outside. While Pepsico India said these "products are not being
exported to other countries", company insiders said 'Nimbooz' and 'Aliva' are finding their way
to Middle-Eastern and Western markets.