House of TATA- Globalization strategies.

.Globalisation Strategies Asset based Capability based Opportunity based BCG Matrix Evaluation Risk Mitigation Strategies Businesses in multiple markets to retaliate against increased competition Increase competitiveness and protect current markets.

• In USA & UK.Global Presence Luxury Hotels • In Asia. Mauritius. hotels in major cities like New York. the revenue from foreign markets is 24. A joint venture with Singapore Airlines is the largest airline catering service in South Asia. . Malaysia & Bhutan. Airline Catering • Partnership with Orbitz Worldwide. a leading global online travel company. Boston and London. Sri Lanka and presence in UAE.IHCL . Airline Catering • Taj Sats Air Catering. • In total 18 international luxury hotels. multiple hotels in Maldives. Cape town (South Africa) and Lusaka (Zambia). • Hotels in Sydney (Australia). San Francisco. operates in India.6% which is least among the competitors.

N. The foreign investment in IHCL (24.6%. entering air catering and tie ups with travel companies are to help IHCL increase its presence and opens up prospects of further partnerships and acquisitions on these lines. The D/E ratio of 98% is much more than both the standard and the competition. It means that IHCL is aggressively financing its growth with debts. Soonawala is sound in his comment on step by step move. an example of this is The Bombay Brasserie. this is the need of the hour but the clarity on execution is not there. Hotels in gateway cities. The director.Globalization Strategies IHCL should and is focusing international expansion and the Cash flow towards investments backs this. London.07%) is highest in the Tata Sons & Group. Banking on its capabilities IHCL strategically made the opportunities count. A. this shows that they are willing to have minimal ownership and more foreign share to internationalize. This strategy can backfire if more acquisitions hand loss. . which is very less than its competitors.IHCL . The 30 year old pioneer restaurant of north Indian cooking in the UK and worldwide. The foreign revenue share is 24. The strategy is to aim at geographical spread.

Tata Steel: Robust Demand Sixth largest steel producers of the world Believe that the owners of steel are going to rule the steel industry. Want to get secure access of the raw materials. BACKWARD INTEGRATION Authoritative Access to the Raw Materials Suppliers to serve the Automobile Industry: Rationale was to acquire the raw materials industry first in order to serve the other industries with a value add and low price on material. Tata Steel’s Indian Operations meet all of its iron ore requirements through captive markets. Eg Acquisition of steel followed by automobile industry (with the lowest possible price on steel). . – Tata Steel’s Indian Operations meet 70% of its coking coal requirements through captive mines.

Tata Steel : Global Strides The Global Footprint .

In 2005-06 Tata Tea acquired Good Earth and made a stake of 30% in US Based Energy Brands. • Diversification: from being significant black tea to fruit and beverage tea. Use of the Tata Group’s “Strength” : Experience 18% of Tata Motors' revenues and 20% of Indian Hotel's revenues comes from international operations. Tetley being 3 times the size of Tata Tea. for Tata Tea. • Reduction of dependency on any one geography.Tata Tea: that global cup of tea…. in 2000 was the largest overseas acquisition being an eye-opener. . it's 70% £ 271Million Tetley deal.

Tata’s Global Presence • • The Tata company operates across 7 business sectors. .3 billion (2010-11 )with more than 65% of its revenue from overseas and commands an employee strength of 424.365+ (2010-11). Total revenue of the Tata group is over US $83.

there is a huge contribution to the Indian economy by the services industry and in which the majority of the revenue comes through the IT and ITES services. Also. – have been low-key or a headsdown approach and the results speak for themselves. . Tata's have been able to spread their wings profitably in an ethical manner. There haven’t been any dodgy promises. this is a Tata company that has truly engaged itself in the global marketplace – which has put India on the global map of the IT Services industry. its focus has been on the long-term objectives rather than on the short-term opportunistic gains. Also. Eg : TCS .Top of the class among Indian software companies. no tall claims etc.Tata’s Global Presence • • • • • Across varied sectors. from core manufacturing to the services .

• . Tata’s have been global thinkers integrating their information to optimize the organizational performance and thereby enhancing the synergies.Tata’s Global Presence • For. an Indian firm to go global. the most essential thing is the change of the mindset of the people working in the organization i.e the adaptability to the changes and hence their impact on the success of the organization.

eg : Tata Swach Strategic Leadership and Learning  TAS  TMTC  Tata Business Leadership Award • .Talent advocate • • Has helped to foster innovation – eg : best failed idea prize Frugal innovation : new products designed to appeal to poor people and the rising middle class.

Also. Development of low cost products for the common masses. • . Also. It has constantly exploited the arena of the new services and has extended a VC type of support to the system for its group companies. involved in development and distribution of educational software for the rural populace. ensures shareholder’s are benefitted in a deal.Other features • • • Development of the weather-alert system for fishermen post the 2004 tsunami.

Alignment with the core value of the “Tata’s” .

Features which may tarnish the Tata image • • • Parochialism Hubris Humdrum over the replacement .

national resources. domestic market conditions. transportation. technology. exchange rates. physical. The National Environment. legal infrastruture. communication. govt. functional. reputation. .Competitive advantage in an international context The Industry Environment -Key success factors. related and supporting industries. Competitive Advantage Firm’s resources and capabilities -financial. policies. HR. general management.

Factors Physical Resources Technology Reputation Functional capabilities Pros +1 0 +1 +1 Cons 0 0 0 0 0 Financial Resources +1 General Management capabilities +1 0 .Analyzing the deal.

Analyzing the deal. Factors Natural resources and capabilities Domestic Market Conditions Government policies Exchange Rates Related and supporting industries Pros +1 +1 +1 0 +1 Cons 0 0 0 +1 0 .Contd.

Threat of Downmarketing. Tata Motor’s Requirements Global presence. The JLR deal would give TATA access to exclusive self-owned distribution channels. Ratan Tata is believed to have developed a personal motivation to buyout British brands to strengthen the “India” footprint in Europe. Risk Mitigation through diversification Personal Motives Re-positioning of Brand TATA . (FIAT for A/B/C segments) FIAT has shown disinterest in pushing TATA’s passenger cars in EURO zone. JLR was a prominent player in the European markets in the premium segment. JLR also commanded a strong brand equity in the Indian market. TATA also got access to Ford’s expertise and brand visibility in the US markets. Command pricing advantage. TATA needed to move from a low-cost positioning in the Indian context to a Luxury-Brand positioning in the global context. The JLR deal can prove to be decisive in this transition. Needed access to global distribution channels to help push its passenger cars in the European markets. Already had access to Korean and APAC markets. especially through LR.Requirements and Gap abridgement. Needed access to both the European and the US Markets after a failed deal with MGRover. After the Corus deal. The deal with MGRover was already sour. Still under the scanner. JLR’s gap abridgement JLR could the void in the luxury segment. The deal will put enormous strains on the cashflows at a time when the Nano was being developed and pushed in the local market.compete with Japanese cars on one hand and luxury brands like Mercedes on the other.