Tata

Tata traces its name from its founder Jamsetji Tata way back in 1868 (Yesudian
49). It is a chain of companies incorporating seven sectors specializing with
materials, engineering, energy chemicals, services, consumer products,
information systems, and communication. Tata Production Company has a high
esteem in India with employees estimated to be over 350,000 personnel and an
average of 100 operative companies in 85 countries around the world (Witzel
138). According to the business reports of the fiscal year 2009, the company had
revenue generation of about US$ 70.8 billion (Witzel 10). Tata is a unique and
respected industrial company in India because of its effort to spring up and start
the first steel, hydroelectric, and inorganic chemistry plants, which saw the
creation of a giant scientific and technological job sites in the country. Tata
Company has since established several institutes such as the institute of social
sciences, cancer hospital, and Tata memorial, and Tata institute of fundamental
research, which later resolved to the countries atomic energy program (Witzel
166). The company has of late scored in buying Jaguar and Land Rover a Fords
stake in the UK.
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Tata group of companies have five core values which they share in common;
integrity, understanding, excellence, unity and finally responsibility. These
companies also work on a common agreement of TATA Brand Equity and
Business Agreement signed with the founders sons (Tata sons Ltd). For the past
145 years, the company has been working on sticking to the ethics of serving the
community with a key growth and sustenance. Tata is endowed with trusted
leadership among the workers, the community, shareholders and the consumer
fraternity, which has earned the company an ego that is unmatchable with other
companies.
Apple Inc Company:
Founded in 1976, apple is a multinational American company, specialized in
designing, developing and selling of consumer electronics, computer software
and personal computers (Carbaugh 100). The company deals with hardware
products such as Mac computers, music players such as iPod, iPhone smart
phones and software products such as OSX and Ios operating systems among
others. The incorporation of the company was done in 2007 by removing the
word computer was marked the focus shift to consumer electronics after coming
up with Iphone.
Apple Inc has recorded one of the highest revenues in the world after sumsang
electronics since it ranked position two as the worlds largest information
technology company.
Tatas External Environment: The PESTEL Framework
External environment is also the macro environment describing the forces both,
internal and external, whose effects to the company are out of control. The
companys/organizations administrative sector is supposed to look into and
identify such issues like political, economical, sociological, technological,
environmental and legislative (PESTEL framework) to address their impact in the
company business.

Political
Owing to the point that Tata is a multinational company, there is need to identify
the political line up and other competing companies in the countries of operation
(Kazmi 83). Various countries have various laws and regulations governing
investments and expansions in any companys trade. To this effect, Tata had to
familiarize itself with the commercial laws and regulations of UK after it (Tata)
acquired Jaguar and Land rover models. UK offers favorable taxation benefits
and support to foreign investors. Tata has always been very keen in observing
labor laws in various countries of investment with a key target of speeding up its
spread in the market, which has been played as the key role by Tatas mother
company, and with the message preached to other branches throughout the
world (Kazmi 83).
Economic
Since Tata operates in several markets across the globe, the company embraces
a global economic model while at the same time, looking keenly at each market.
Tata has formed several joint ventures as its entry strategy to other markets. The
global focus, through joint venture initiatives has given Tata platform to learn and
adapt to local conditions easily. Tata group has experience from the five
continents. If an issue arises in one market, the company is able to gather
information from the other markets to deal with the specific issues. For instance,
if the cost of aluminum goes up in one of supplier countries, Tata can shift to
another supplier where the costs are competitive. Tata operates an integrated
supply chain. The company sees its activities as interdependent on those of
suppliers. Overall, the company maintains a health relationship with its suppliers,
since this enables the company to enhance its ability to create value for its
clients, society, and investors.
Tata Motors has to take cognizance of the fluctuations of currency rates across
many economies. According to, currency fluctuation can influence the sales of
cars in a great way. For instance, currency fluctuations can mean high or low
demand for Tata cars, which in turn can significantly affect the profits margins.
Social factor
An organizations future is heavily reliant on morals and stance of the stake
holders. For this reason Tata Company has been adapting to performances of
foreign companies they get in touch with, thus optimizing knowledge in the
industry. The company sets to product localization incase of pricing depending on
sizes in population, demography and income in various market outlets.
Considering for example the income per capita in India and Italy, that of India is
less and so consumers may prefer smaller models of cars such as Tata Nano
unlike in Italy where the income per capita is higher and so consumers may
prefer bigger and fancier vehicles. Tata has maintained the idea of market
familiarization and keeping their brand name throughout the world. This has been
the case when it acquired Fords Jaguar and Land Rover since they did not the
brand name but they rather chose to maintain it for the wellbeing of social ego of
the consumers. In addition, the company acquired Daewoo Commercial Vehicle
in 2004, for the same reasons.
Technology

On the technological front, Tata Motors and its parent company, the Tata Group,
have faired well in terms of technological advancements. The Group has more
than 20 companies listed in various stock exchanges across the world. This
means the company has a wealth of experience and resources to draw from in its
research and development efforts. Tata understand that the secret to success is
in understanding the needs of the market and coming with product offerings that
match customer needs. Such efforts cannot succeed without the input of the
R&D. R&D efforts are based on cutting-edge technologies employed by Tata in
ensuring that its products far exceed those of the competitors. Accordingly, the
company has more than 1, 400 scientists as well as engineers, making the
company well-equipped, both in India, as well as in the international market
arena. Because of technological breakthroughs, the company has made it first in
several aspects. First, Tata developed the first Sports Utility Vehicle in India. In
addition, it was first to develop the first indigenous passenger car in 1998.
The biggest challenge for companies, both in the domestic market as well as in
the global markets is the ability to stay ahead of others. Therefore, technology
plays a key role in maintaining a competitive edge. Tata, in recognition of this
important role of technology, dedicates more resources and efforts in research
and development to be at par with or even ahead of others.
Environmental factor
Tata has been well placed in terms of competition in the world market. This has
been facilitated by its well researched and adapted strategies to realize
competitive advantage over its rivals. A friendly environment has been created in
its business endeavors because of highly interacting with many other companies
throughout the world. However, challenges of gas emissions and pollution from
its companies have been of great concern. This has forced Tata to pump more
resources on research to combat emissions.
The legal factor
Tata has devised better strategy making, an experience from the multinational
business operations, which has made it stand better competitive advantage over
its competitors. This is because for any new company in the market it has to face
competition from the already established companies in the market (Kazmi 84).
Competitive Strategy: Porters Generic Strategy framework
To acquire a sustaining competitive advantage, a company needs to have a well
laid down competitive strategy (Eldring 7). The market environment is so much
dynamic such that a company should have strong and distinctive competitive
strategies. Tata has applied its understanding in the designing of its markets in
order to make better delivery to its customers who are also the target of the
companys competitors. According to Michael Porter, a company can follow three
competitive strategies to plan out and win the market for its products; cost
leadership, differentiation and market segmentation. Under cost leadership, the
company is focused on cutting down costs of production and distribution. The
company is left to serve customers who are aware of cost of production. The
prices set by the company are one of the lowest. This is what Tatas steel
company embarked in simply because of its raw materials reservoirs spread in
countries like Australia, Oman and Mozambique, hence it could persevere the

price flux of its raw materials due to the availability of iron ore mines. For this
matter, Reliance Industries have become the giants in various global businesses
compromised on innovation and cost.
By differentiation the company targets on customers who are not sensitive on
prices in competitive markets where customers gets service which is below
average to satisfy their needs just because the firm has exclusive resources.
Product differentiation can be achieved by having various sources, various
ingredients, putting various features, and design this has the trend with Tata
company especially with the introduction of Tata Nano which was a small car
model.
Through market segmentation, the company is focused at a particular group of
consumers segmented to meet a competitive advantage through innovation
marketing of the product regardless of the efficiency. If a company fails to choose
either leadership cost or differentiation it means that the company is hanging at
the mid of the business success and therefore it loses competitive marketing
strategy which results to poor financial performances.
Resource-Based View
In the Resource Based View, the firm is perceived as a pack of resources which
when put together makes organizations differ from each other hence making
them be able to make market delivery of their goods and services (Henry 126).
Under the market-based view, the agenda is sourcing for attracting markets for
competition. In the resource-based strategy, the companys resources are viewed
and these resources can be pulled/redirected in other ways, which are better
suited to expansion and development (Henry 126). This is actually the case Tata
motor industry company that redirected the resources of producing bigger
vehicles to smaller ones like Tata Nano, which was affordable to most Indians.
Strategic rationale for global development
The fact that Tata is a multinational chain of companies; it is focused to make
achievements based on two major ideas. First, to expand the global market
based on the existing products and to build a large mass market that is coming
up in the mother country. Global expansion is associated with so many risks and
so the company may take the option related to each option. This is actually the
presentation of Ansoff in his growth vector.
Ansoff Matrix
Existing product

New products

Existing markets

Market penetration

Product development

New Markets

Market development

Diversification

The Ansoffs Matrix provides four different sets of growth strategies that a
company can pursue in the market (Bachmeier 3)
Market Penetration: The Company seeks to gain growth by selling more of its
products within the market in which it operates (Harrison and Caron 111)

Market development: Tata seeks growth by selling its products into new markets
like China (Raju 326).
Product development: This is achieved by developing new products to satisfy
the needs of clients within its markets
Diversification: The Company develops new products for new markets. The
Tata Group operates pharmaceuticals, hotels, automobiles, among others (Ramu
51).
Apples Global Strategy
Apple pursues a differentiation strategy, by offering products of high
quality (Kluyver 67). The company broadly targets its customers with its product
range. The company adds value by retaining in-house elements of design, while t
the same time outsourcing production to minimize costs.
This model sets the objectives of a firm alongside other models such as the
Porters framework model among others. It is based on market penetration and
development, and product development and diversification. Therefore, Tata is
targeted to new market penetration by use of its already existing products such
as Tata trucks, soda ash among other products. Owing to the point that the
company is spread in various parts of the world it can use its already existing
customers for sales increment without the change of its original product market
strategy. This means that Tata can use the strategy of acquiring the competitors
customers, improving the quality of its products/service level, and making their
products attractive to non-users/encouraging the existing users to increase the
product usage by use of marketing or other tools of communicating like
advertising (Koekermoer and Bird 81). Tata is also targeted at product
development of new products such as Tata Nano. The other factor is market
development, which Tata has already achieved in venturing into global markets.
The company is targeted at making bulk sales of its new Tata Nano car model.
Through market diversification, the company has already made expansions in
new markets where it aims at strategizing making good competitive advantage of
its products. Since a company cannot stay within its borders and become
competitive, Tata has taken the role making global expansions of its products
through delivery of low cost products, which are friendly to the customers
pockets.
Methods used to expand globally
Tata Company owing to its good management has won most world markets for
its products. The company has been using assimilation of ideas and technology
of existing companies in the market to position their products (Dogra 101). On a
general scope, Tata Company has made several strides in the outside market.
For example, Ratan Tata the chairperson of the company hired Alan Rostling, the
chairperson of Hong Kongs Jardine Matherson Group as the director of the
company with a view of acquiring two companies, Jaguar brands and critical
industrial enterprises. The company believes in doing good to acquire good
business through the offering of equitable units for willing participators in the
global investment. However, the company is faced by a number of challenges
like labor and management especially to the growing number of non-Indian
employees. Among other challenges are like the success of Nano which was only

for the Indian, Africa, Latin America and Southeast Asia markets.
How Apple Can Learn From Tata Motors
Although the two companies operate in different industries, there are several
strategic moves that Apple can learn from the success of Tata Motors. Indeed,
the creation of cars like Nano and OneCAT provides a variety of ways in which a
company can continue to grow in the competitive market. First, entering a new
market requires a well-thought strategy to succeed (Coade 32). For instance,
joint venture initiatives could be helpful while venturing new markets like China.
Secondly, Tata uses R&D heavily. This is critical in providing cutting-edge
products. Thirdly, cost leadership is critical. Through integrated supply
management, Tata can enjoy low cost of supplies, which translates into low cost
of cars for the customers.
Conclusion
Tata Group has been the main force behind the success of Tata Motors. In
addition, the company has gained a competitive edge because of its acquisitions
and mergers. Despite its fall in the stock prices, the company should continue to
invest in eco-friendly products to overcome the challenges posed by rivals in this
segment. Tata should also venture into the Chinese market, since China has a
big potential because of rising incomes among the people. In doing so, the
company should take cognizance of cultural influences in doing business in
China.
Apple should focus on technology as a way of gaining a competitive advantage
over rivals like Google. Apple should learn from the mistakes of Google in making
entrance into markets that are promising, like China. In such markets, the
company should focus on localization and cooperation with the Chinese
government to gain a foothold in the Chinese market.
Apple should embrace a close relationship with suppliers, just like Tata Motors. A
close relationship with suppliers will moderate the power of suppliers and assist
in getting attractive prices of component. In addition, Apple should diversify by
creating complementary products in other segments. This will increase the
companys revenue base.