STUDY OF BALANCED SCORECARD

ANALYSIS OF TATA MOTORS

By MATHEW ROY
POLLAYIL
How the project is related to the course or subject?
I have learned many concepts of strategic management concept, one among that is Balanced
Scorecard (BSC), which exaggerate the critical success factors and the key performance
indicators for the growth of the organization. Therefore, for my research purpose I selected
Balanced Scorecard.
As Tata Motors have undergone many strategic changes in the past years their market growth
depends on how they learn their market, internal processing factors, customer reviews and the
impact on financial statements. For this, they may need to analyze the different critical success
factors and their performance indicators which comes under Balanced Scorecard.

Reason for selecting topic?

Foremost, the prime motive of every business environment is to maximize shareholder wealth.
For this they move with their mission and vision statements strategy, objectives.
A balanced scorecard(BSC) is an analysis proceeded in the strategic level as a strategic planning
and a managerial control system which helps the organization to understand what their mission
and vision statement focus on and what they must do to accomplish the objectives. A balanced
scorecard analysis develops a strategy to meet the result in a day to day basis by designating the
products, projects and services, analyze and help to take control over the organization needed to
achieve their strategic target.
Myself as youngster like to know more on automobile sector and have keen interest in knowing
the business culture of that environment.
Therefore, I opted Tata Motors, the largest automobile sector in the country, which can gain my
research knowledge in balanced scorecard and more about the growth motive of Tata Motors.

Expected contributions of the study?

The expected contribution of this research mainly is analyzing the balanced scorecard and
understanding the critical success factors and key performance indicators for that success to
occur.
For this Balanced scorecard analyze is divided into 4 perspectives
 Financial perspective
 Internal process perspective
 Learning & Innovation Perspective
 Customer perspective
Expected contribution from financial perspective is analyzing their financial statements and
exposing revenue growth and productivity objective by knowing their key performance
indicators and critical success factors.
Expected contribution from an internal process perspective is about the product leadership
strategy, customer intimacy strategy and operational excellence strategy by knowing their key
performance indicators and critical success factors.
Expected contribution from learning and innovation Employee capabilities (core competencies
and skills). It might include:
Employees obtaining the skills necessary to support the strategy.
Facilitating people to gain a better understanding of some of the company’s aspects (marketing,
sales, etc.);
Information system capabilities
Explore what information systems (CRM, ERP, BMP) you might need to execute your strategy
effectively;
Strategy awareness and motivation
Address some typical motivation and alignment issues by running the program that will explain
strategy to your employees and involve them in the strategy execution

The financial perspective

Focuses on financial performance of an organization. It normally covers the revenue and profit
targets of commercial companies as well as the budget and cost-saving targets of not-for-profit
organizations. The financial health of an organization is a critical perspective for managers to
track. It is important to note that financial performance is usually the result of good performance
in the other three scorecard perspectives.

The customer perspective

Focuses on performance targets as they relate to customers and the market. It usually covers
customer growth and service targets as well as market share and branding objectives. Typical
measures and KPIs in this perspective include customer satisfaction, service levels, net promoter
scores, market share and brand awareness.

The internal process perspective

Focuses on internal operational goals and covers objectives as they relate to the key processes
necessary to deliver the customer objectives. Here, companies outline the internal business
processes goals and the things the organization must do really well internally in order to push
performance. Typical example measures and KPIs include process improvements, quality
optimization and capacity utilization.
 The learning and growth perspective
Focuses on the intangible drivers of future and is often broken down into the following
components:

 Human Capital (skills, talent, and knowledge)

 Information Capital (databases, information systems, networks, and technology infrastructure)
 Organization Capital (culture, leadership, employee alignment, teamwork and knowledge
management).

Review of literature
Tata Motors as a developed a reputed brand the automobile industry, there growth and
production strategies have been researched for different purposes.
Tata motors themselves analyze their financial perspective and growth in their annual reports and
report to their stakeholders.
Dhruba Jyoti Borah, Solmaz Filiz Karabag,Christian Berggren these authors have published in
Gerpisa colloquium, Paris (2015), a known business paper about the innovation and learning
strategy of Tata Motors when Tata Motors acquire Jaguar and Land Rover and combined both
into one company as Jaguar and Land Rover Corporation(JLR).

Tata Motors customers starts with domestic automobile users to capital automobile users.
Prof. Nistorescu, Mr. Mihail Barbu and Mr. Roxana Ioana Dumitriu (2013) conducted a study
concerning customer loyalty in the auto market. 593 customers were taken as sample for the
survey. Simple random sampling technique was used to select the sample.
Nataraja S and Dr. N. Nagaraja (2012) conducted a research on “Customer satisfaction in
automobile industry – an Indian online buyer‟ perspective of car manufacturers websites. The
objective of the study was to reveal the online behavior of today’s auto customers.

Rationale of the problem

The biggest reason that the Balanced Scorecard has been so popular and successful for so many
years is because it continues to be a proven framework organization use to organize their various
strategies. For example, if your strategy is to embrace “big data,” the Balanced Scorecard can act
as a gateway for your company to achieve that goal. If you use Six Sigma or TQM, the Balanced
Scorecard can also help with that. If you run global franchises or a small storefront, the Balanced
Scorecard is very useful.
It ties directly to the number one issue of executives today in strategy execution. As Tata Motors
deals in whole over the world with different customer sectors, they come across with different
problems from bottom to top level. Balanced Scorecard analyze makes solution for these
problems through making clear by providing a framework to align in the organization around a
mission and vision.
It allows organizations to be more responsive to changes in the competitive landscape. Balanced
Scorecard indicates the critical success factors and their key performance indicators which
regulates the organization work module in a set of style which reflects in their competitive
excellency and provides quantifiable metrics that show the health of an organization
It helps drive transparency. When stakeholder knows the proceedings of the organization it
develops a transparency. Tata Motors can directly connect all its objectives and strategy in a
single Balanced Scorecard which links projects to measures, and measures to strategy.

Research methodologies
Focus of research consist was on finding the critical success factors and key performance
indicators of Tata Motors which was useful in whole of the movement of the research.
Financial Ratios and its interpretation are collected to identify the financial perspective of Tata
Motors. These Ratios analyses was formulated for the financial records of Financial statements
Tata Motors o from 2015 to 2018. These statements were collected from annual reports of Tata
Motors and also from business reporting sites.
Internal Process

Sources and types of data

All data was collected was categorized into 2: primary and secondary.
Primary Data of Tata Motors was collected from the customer review of Tata Motors and the
employees working in Tata Motors.
A sampling survey was conducted with my known vehicle users about Tata Motors.
A questionnaire was given to the employees working in Tata Motors which was answered by
them.
Secondary Data of Tata Motors mainly deals with reports from different websites, newspaper
and business consultants which have interpreted for many purposes.

Sampling plan
A structured questionnaire was used to collect the data. The analysis showed statistically
significant correlation between satisfaction and repurchase, between satisfaction and
recommendation and between recommendation and repurchase. The research concluded that
loyalty is a powerful marketing tool and the three dimensions are interrelated.
Exploratory research was undertaken, and a structured questionnaire was designed and sent to
different customers of Tata Motors. Customers consider “quality of content” and Ease of
navigation” as the most significant factors. The research concluded that change evolves rapidly
with the emergence of powerful Customer-to-Customer tools like blogs, discussion forums,
social networking sites and virtual worlds
Company Profile About Balanced Scorecard
Tata Motors Limited
Tata Motors Limited (formerly TELCO, short for Tata Engineering and Locomotive Company)
headquartered in Mumbai, is an Indian multinational automotive manufacturing company and a
member of the Tata Group. Its products include passenger cars, trucks, vans, coaches, buses,
sports cars, construction equipment and military vehicles.
Tata Motors have auto manufacturing and assembling plants whole over in India, Argentina,
Great Britain, South Africa and in Thailand. Jamshedpur, Pantnagar, Lucknow, Sanand,
Dharwad and in Pune are the places where Tata Motors have auto manufacturing and assembling
plants in India. Having research and development centers in Pune, Jamshedpur, Lucknow, and
Dharwad, India and in South Korea, Great Britain and Spain.
Tata Motors consist of many acquisitions and joint venture whole over the world. Tata Motors
acquired the English premium car maker Jaguar Land Rover (the maker of Jaguar and Land
Rover cars) at 2008 and the South Korean commercial vehicle manufacturer Tata Daewoo at
2004. Tata Motors has a bus-manufacturing joint venture with Marcopolo S.A. (Tata Marcopolo)
at 2006, a construction-equipment manufacturing joint venture with Hitachi (Tata Hitachi
Construction Machinery) at 2000, and a joint venture with Fiat Chrysler which manufactures
automotive components and Fiat Chrysler and Tata branded vehicles and others.
Tata Motors mainly build up their segments for Utility vehicles, Capital vehicles, Defense
vehicles and Machineries. Tata Motors, Tata Daewoo, Hitachi and Tata Marcopolo concentrates
on capital segment vehicle such as mini lorries, trucks, buses. Hitachi also develops machineries
for construction and infrastructure industry. Tata Motors defensive vehicles are used by military
in many countries and mainly in India. For the pa st one decade Tata Motors have
Tata Motors range of commercial vehicles spans over 135 models and can haul loads ranging
from 2 to 40 tones. The product portfolio also includes 12 to 60-seater buses, tippers and tractor-
trailers. Tata Motors vehicles meet the stringent Euro emission norms. The company currently
has an export base in most parts of South Asia, Africa, Middle East and Europe. Tata Motors
recently crossed the 3-million production milestone.

Innovation and Learning Perspective of Tata Motors

Tata Motors, as a reputed brand in the Indian and world economy over 70 years their success
factors all represent how they anticipate the growth in the automobile industry in the worldwide
knowing the customer needs and desire and taking the best steps for moving with the changes.
Each segment of Tata Motors focus on innovating their products which creates a new
development in the industry.
Innovation is deeply embedded in our DNA, and is demonstrated through our path-breaking
vehicles, ranging from India’s first fully indigenous passenger car, the Indica, to the Nano, the
Zest, the Bolt, and now the new generation cars – Tiago, Hexa, Tigor and Nexon.
On the cargo transportation side, our vast range of commercial vehicles includes the globally
benchmarked Prima, Signa and Ultra trucks in the Medium & Heavy Commercial Vehicle
(M&HCV) segment, the Xenon Yodha in the pickup category and the segment-redefining Tata
Ace.

In passenger transportation, Tata Motors has unleashed the future of mass public transportation
by launching the Starbus Electric (9m and 12m) and the Starbus Hybrid 12m buses. To meet the
current and future passenger transportation needs in smart cities, we have rolled out a range of
smart buses which are designed, developed and powered by alternate fuels. Developed
indigenously, these buses are safe and comfortable and are economically viable ‘Made in India’
solutions.

We focus on current and future auto technologies to enhance the look and feel of our vehicles
and to boost the overall driving experience for our customers. Our new age concept cars and
award-winning engines are examples of how far our innovative techniques have brought us.
From frugal engineering to our work on vehicles, powered by alternative fuels, our innovation
thrust forms one of the pillars of a business built on sustainability.

Our state-of-the-art R&D centers and design studios are located in Pune (India), South Korea,
Italy and the UK, and have many firsts to their credit. We boast of housing Asia’s first anechoic
chamber, India’s first full vehicle crash test facility and India’s only full climate test facility.
With over 4,500 engineers, designers, scientists and technicians, we are making path-breaking
innovations that are driving the form and performance of future vehicles.

REFRENCE
http://www.tata.com/innovation/index/Innovation
https://www.slideshare.net/HussainBharmal2/financial-statment-analysis-of-tata-motors

THANK YOU