MARKETING MANAGEMENT

CASE STUDY ON TATA ENTERPRISES

Internal Assessment –II

Submitted By

KASHISH AGARWAL
PRN: 22010324108

BBA-LLB – Division-D

Under Guidance of

Prof. Kishore Kumar

Date: 07-10-2022
CONTENTS
S.NO
PARTICULARS
PAGE NO.
1
INTRODUCTION
2
NEED FOR THE STUDY/STATEMENT OF PROBLEM
3
SCOPE & LIMITATIONS OF STUDY
4
REVIEW OF LITERATURE
5
OBJECTIVES OF STUDY
6
ANALYSIS & FINDINGS
7
SUGGESTIONS & CONCLUSION
8
BIBLIOGRAPHY/REFERENCES
1. INTRODUCTION

Mumbai, India is home to the multi-billion dollar, international Tata Enterprise. Ratan Tata, a
well-known industrialist, is currently in charge of the business. The corporation engages in a va-
riety of operations and conducts business in more than 100 countries across six continents. It is a
private organisation made up of about 100 different businesses. As of March 31, 2021, the corpo-
ration, which is traded on the stock exchange, had a net worth of $242 billion. It owns several
different businesses, and its business portfolio is moderately diversified. At this point, it ranks
among the largest corporations in India. The renowned businessman and philanthropist Mr Jam-
setji Nusserwanji Tata created the Tata Group as a private trading company in 1868. The Taj
Mahal Palace and Tower, the first luxury hotel in India, was built by the Tata Group later in 1902
and opened the following year. VIPs stayed there and carried on with their business, and this is
where the Tata Group's success story begins. The business is steadfast in its commitment to its
core principles, which state that "We will be bold and agile, fearlessly taking on problems, and
using deep consumer knowledge to generate innovative solutions. We commit to making invest-
ments in our partners and employees, supporting lifelong learning, and developing caring, coop-
erative relationships based on mutual respect and trust. (Values and Objectives).

2. NEED FOR THE STUDY/STATEMENT OF THE PROBLEM

- To comprehend the idea and application of corporate social responsibility and to gain knowl-
edge of CSR practises in light of the TATA Group case study.

- To comprehend the idea of CSR.

- To determine the reach of CSR.

- To understand what precise initiatives, plans, and strategies the Tata group set forth, devel-
oped, and put into action to achieve its obligations to all stakeholders.

3. SCOPE AND LIMITATIONS OF THE STUDY

As I was writing this research paper Legal considerations such as labour and employee welfare
legislation, business governance, and other associated regulations have not been made.

4. REVIEW OF LITERATURE

1. Maureen Butler (2005) -

It demonstrates how a fundamental analysis technique based on accounting can estimate

market performance over the long term in the setting of strategic alliances. According to
the researcher, alliances are more prevalent in high-technology businesses and their pri-
mary goal is to emphasise growth. These partnerships are growth-oriented, and the mar-
ket typically does not forecast the firms' long-term performance.

2. Asher Curtis (2008)

This studies the time series characteristics in connection to the development of the link
between price and various fundamental value measurements. The current study employs a
fundamental value model that combines anticipated risk and potential growth. The con-
sistency of the relationship between the stock's price and growth has been investigated by
the researcher.

3. exJoseph.D.Piotroski (2000)

This review assesses the effectiveness of a fundamental strategy known as the fundamental
Score, which was developed and used for companies with high BTM ratios. This grade places a
strong emphasis on assessing a firm's many fundamental factors, including profitability, liquid-
ity, solvency, and operational effectiveness. This study creates an index that incorporates each of
these characteristics. In the two years after the portfolios' establishment, less than 44% of all high
Book-to-Market enterprises experience positive market returns, according to this study. The
main contribution of this study is that by using straightforward accounting data, retail investors
can create higher-value portfolios. This data is based on the companies' previous past perfor-
mance.

4. Zafar S.M.Tariq & Khalid S.M (2012)

The study looked at how ratios were calculated from financial statements that were created using
targeted management depreciation and stock valuation methodologies. A ratio cannot provide a
complete and accurate picture of a company because it is only a simple comparison of a numera-
tor and a denominator. The promoters influence the results and may prevent them from revealing
additional factors that affect a company's performance.

5. Dawar Varun (2012)

A study will look at how the stock prices of Indian automakers are impacted by various elements
of basic business policy, including dividend, debit, and capital spending. The analysis found that
while dividend and investment strategies were related to stock prices, capital structure was not.

5. OBJECTIVES/FINDINGS

1. Due to its central role in the social system, businesses must address a variety of societal needs.
2. A resourceful business has a specific obligation to the community.
3. A business's social involvement would strengthen its link with society and help both groups
work towards mutual benefit.
4. By taking part in social activities, a business may enhance its goodwill and reputation, attract-
ing customers, productive workers, and investors.

6. RESEARCH METHODOLOGY

A thorough literature review on the subject and associated ideas has been conducted. For the aim
of the study, secondary data—which includes both quantitative and qualitative data—is gathered
from a variety of sources, including books, research papers, newspapers, magazines, and web-
sites.

7. ANALYSIS AND FINDINGS (OVERVIEW OF THE COMPANY)

JAMSETJI TATA
Known for founding the Tata Group, currently India's largest conglomerate firm, Jamsetji
Nusserwanji Tata was an Indian industrialist. He is renowned for founding the city of Jamshed-
pur as well. He established the enterprises that would eventually make up the Tata Group. Jam-
setji Tata was known as the Father of Indian Industry and was thought to be smart. The first
Prime Minister of India, Mr Jawaharlal Nehru, referred to him as the "one-man planning com-
mission" because of his prominence in the business sector. He broke with family customs by be-
ginning his business in Mumbai, being the first member of the family to do so. For his reformist
approach to industry, he was admired and revered by many. The first prime minister of India re-
spected him and regarded him as a patriot.

DIVERSIFICATION

Tata Group was founded in the year 1868 by Jamsetji Tata as he started a trading firm in Mum-
bai. After that, he entered the hotel business by constructing the renowned Taj Hotel and Tower.

After Jamsetji’s sad death in 1904, his son Mr Dorab Tata became the chairman of the Tata
group. The diversification of business started under Dorab’s leadership as the Group started ex-
ploring new industries such as the Steel industry in (1907), electricity in (1910) education in
(1911), consumer goods in (1917), and aviation in the year (1932). It can be seen that the firm di-
versified its functions into five new sectors, and since then, the Group has diversified into many
industries and made a name for itself. Some famous Brands in which the Tata enterprise owns a
share are Starbucks coffee, Tanishq, Westside, Titan, TATA salt, Voltas, etc.

The Tata Group is diversifying its portfolio at a large scale. The reason can be that diversifica-
tion strategies that are used by the companies are usually done to expand the scale of the firm's
operations by adding markets, products, services, or a stage in the production of business. The
diversification of services allows the company to enter into new sectors that are primarily differ-
ent from the company's main operations. Concentric diversification is the process of adding new
ventures that are somehow strategically tied to the existing firm. Conglomerate diversification
happens when the previous line of business and the new business are completely unconnected to
one another and have no similarities or connections to one another. (TATA Motors diversifica-
tion strategy)
The process of diversification is a very smart move by the Tata group as it helps them because
they are not dependent on a single business and have a diversified portfolio, and in a case when
the market situation for one industry is not good, then they won’t be solely dependent on that as
they have other businesses as well, so we can say that diversification helps the reducing the risk
of market fluctuations as it results in multiple sources of income which are not directly related to
each other and hence, their performance is independent to the other companies.

There are several other benefits to disinvestment it helps to safeguard the capital of a company
and since the resources are not concentrated on one single area the dependency reduces giving
businesses more financial autonomy and financial freedom, and it also helps us seek advantage
of different industries as every industry has different investment structure and different profits if
used intelligently, one can easily benefit from the investment planning in different ventures. An-
other point that supports the going argument is that it helps a person will be more profitable in
case he has a diverse portfolio which, as discussed above, reduces the risk of losses and safe-
guards from market volatility.

KEY CAPABILITIES

BUSINESS EXCELLENCE:

The Group has a global influence, and with time and care, it has grown to international stan-
dards; due to owning various businesses, they have a better understanding of the overall market
and have learned to use their resources to their optimum capacity. The Group is constantly team-
ing up with other companies to get more perspective into their business which also reduces their
competition. Teaming up with other companies to develop new products also provides for com-
petitive advantage for the Tata Group.

INNOVATION:

The Group has made innovation a priority as one of its growth and success drivers. The company
has implemented a three-pronged strategy to foster innovation, which includes recognising and
appreciating fresh ideas and efforts, providing forums and facilities that allow learning from
other businesses and supporting collaborative research and partnerships with international re-
search institutions. The Tata group has been making an effort to reinvent itself and launch cut-
ting-edge items rather than conventional ones.

BUSINESS STRATEGY

The Tata Group has a wise business strategy that prioritises domestic operations while also ex-
panding internationally. The Group is creating a plan to attract foreign investment. The Tata
Group is concentrating on new development industries like financial services, retail, infrastruc-
ture, and aerospace. They strive to be more competitive and utilise technology for their company
while fostering relationships across the group companies. (DUBEY, 2014)

PROBLEMS FACED BY TATA GROUP

The main problem has to do with the deregulation of the Indian economy at the outset of the
1990s. The future concerns of Ratan Tata's business also had a big impact. Although the com-
pany was successful and was not failing in particular and was also expanding its global geo-
graphical presence, The question of which direction to choose was remaining. Such uncertainty
was associated with the absence of the required developmental facilities in India, which p osed
the risk that it may limit Tata Groups’ local expansion.

The problem is even more challenging when you factor in the fact that a trillion dollars in its sec-
tor investment are in requirement of funding the infrastructure to overcome poverty, which im-
plies that Tata Group’s vision is far from bright. Another issue that poses a challenge to the
Group is the selection of a person to run the business after Ratan. This problem had the potential
to make the company deprived of a good leader that can support the Tata Group in its expansion
and achieve new goals.

SHORT TERM ISSUES

The corporation is also concerned about issues relating to the development and retention of the
talent currently employed by the Tata Group. According to the case study, which includes Tata
Group, the company's working atmosphere pushes local employees to move employment in
quest of better opportunities abroad in addition to the wage discrepancies. Rajan Tata consis-
tently emphasised the need of having a devoted and devoted staff to address the issue of talent
shortage at the company and maintain the commercial plans of the Tata group.
LONG TERM ISSUES

According to analysis, the Tata Group's business activities have become far more diverse, and as
a result, the corporation has become less focused. The business ought to have focused more en-
ergy and attention on dominating sectors that, in general, produce higher profits. The company
ought to have placed more emphasis on lucrative, leading industries. Ratan Tata has tried in vain
to streamline the organisational business processes, and he now has to cope with the long-term
challenges of having an inevitable successor carry the majority of the firm.

ANALYSIS

With the challenge of a shortage of Indian talent in the company and poor working conditions in
cities such as Jamshedpur, The Tata group is now faced with the problem of a lack of resources
for proper functioning. With such prevalent problems, it seems very difficult for an organization
to achieve desired growth. The overall management of the company may be considered as lack-
ing focus and proper direction. On the one hand, the business leader seems to be focusing on the
concept of international growth, and Ratan Tata has always been very vocal about not throwing
all resources into one business. The over-diversification of business activities amongst various
sectors results in negative implications such as debt and resentment from employees due to
downsizing.

SOLUTION OF THE PROBLEMS

SHORT TERM SOLUTIONS

The management of the Tata Group developed an inclusive business plan to address the develop-
ment of talent and retention by providing facilities such as better insurance and more communi-
cation between upper-level and lower-level management, which has helped in the retention of
talent and also the preservation of occupational health and safety.

The company has made an effort to increase its local presence and cater to local consumers and
broke the pattern of negative attitudes shown by local consumers about the services provided.
For example-Tata, motors have improved its after-sales service and made changes in the market.

LONG TERM SOLUTIONS

To address the long-term issues of the company, the company concentrated more on the high-
earning departments of the business, which included Tata Motors, Tata Steel, and Tata Consul-
tancy Services, to secure profits and reduce debt. While they focused on the high-performing
companies, the other projects were not ignored and were put on pause by the upper management.
The Group decreased the number of underperforming departments and merged them with other
departments during the time of downsizing and slowed down the diversification to prevent over-
diversification and to get more debt on the company's back. Focusing on performing sectors
helped the finances, and slowing diversification helped them to focus resources on the existing
business operations of the company and regain financial autonomy.

ANALYSIS

The company focused on profit-making departments while slowing down the diversification,
which helped them to concentrate more resources on the business, and the merging and closing
of loss-making businesses helped them reduce their liability and create a name in the local mar-
ket enhancing the company's image. The Group also made changes to ensure the retention of tal-
ent and job satisfaction for the employees by providing them with training and improving their
skills.

8. CONCLUSION & SUGGESTIONS

The entire balance in the economic and social sectors must be restored and preserved, which re-
quires adopting ethical CSR practises and carefully evaluating one's actions. Every organisation
has a responsibility to the society, nation, and global community that provides it with all of its
raw materials, labour force, and natural resources. To attain and uphold a balance between busi-
ness and society, this generation and the next, and man and nature, new policies must be devel-
oped and put into practise. This is particularly true when long-term growth, growth that is eco-
logically sustainable, and CSR criteria are taken into account.

In terms of fulfilling its duties and honouring its commitments to society and the nation, the Tata
Group has come a long way. The founder of the organization's claim that "We do not claim to be
more unselfish, more generous, and more philanthropic than other people" is supported by the
fact that the organisation has assisted the general public in bettering their lives, encouraging their
goals, and developing their abilities. We do believe, however, that we had a solid base upon
which to build thanks to unambiguous business principles that took into account our goals, those
of our investors, and the welfare of our people, who are the certain cornerstone of our profitabil-
ity.

To successfully implement CSR, the concept of a private-public partnership (PPP), in which

government officials and corporate representatives work together for a shared purpose, should be
used. The task of overseeing and evaluating CSR activities at the political and corporate levels
ought to fall under the purview of the human resources division. There are two approaches to
take: (a) direct effects, such as cost- and money-savings; (b) indirect effects, such as increased
worker satisfaction, decreased absenteeism, and decreased staff turnover as detected by staff sur-
veys Every company should periodically review its CSR programmes to identify any risks or
missed opportunities.

Innovation should take preference over all other considerations, whether it is venturing into un-
known CSR area, creating a CSR strategy, or implementing that plan. As CSR projects are cru-
cial to the improvement of the general public and can be completed through a range of pro-
grammes and initiatives, NGOs should be encouraged to collaborate on them. In conclusion, let
me state that the Tata Group is a diversified conglomerate with a long and rich history of innova-
tion, social responsibility, and ethical business practices. The organisation has demonstrated re-
silience and flexibility and is continuing to work towards its long-term strategic objectives of de-
velopment, innovation, and sustainability despite recent challenges like the leadership change
and the COVID-19 outbreak. The existence of a strong leadership team, as well as a renewed
emphasis on digital transformation and worldwide expansion, has placed the Tata Group in a
good position to manage the changing business climate and give long-term value to its stakehold-
ers.

9. BIBLIOGRAPHY/REFERENCES

DUBEY, N. (2014). CORPORATE DIVERSIFICATION STRATEGIES: INDIAN PERSPECTIVE. Ljubljana.

TATA Motors’ diversification strategy. (n.d.). Retrieved 01 07, 2022, from IPL: https://www.ipl.org/
essay/Tata-Motors-Diversification-Strategy-PCMBEP8ERU

Values and Purpose. (n.d.). Retrieved 01 07, 2022, from TATA: https://www.tata.com/about-us/tata-val-
ues-purpose

( Nolen, Jeannette L.. "Tata Group ."Encyclopedia Britannica, 9 Dec. 2021, https://www.britannica.com/
topic/Tata-Group. Accessed 7 January 2022

Nolen, Jeannette L.. "Tata Group ."Encyclopedia Britannica, 9 Dec. 2021, https://www.britanni-
ca.com/topic/Tata-Group. Accessed 7 January 2022

StudyCorgi. (2020, December 17). Tata Group’s Problems and Recommended Strategies. Re-

trieved from https://studycorgi.com/tata-groups-problems-and-recommended-strategies/