Can you answer question 8-7. please

CLOSING CASE Tata Group: India's Top Global Challenger Tata, one of India's largest companies, operates in more than a Background on the Tata Group dozen different industries, including automobiles, chemicals, infor Founded in 1868 in Bombay as a textile trading company. Tata mation technology consumer products, engineering, and consulting. gradually expanded into hotels, power plants, chemicals, steel pro- Altogether, Tata comprises more than 90 firms. The chairman of Tata duction, and several other industries. The government of India long Group until his retirement in 2017 was Ratan Tata, the charismatic de- discouraged international trade by imposing high trade barriers scendant of the company founder. Now in his eighties, he emerged and bureaucracy. As these restrictions loosened in the 1990s, Ta- as a popular and respected corporate titan, known around the world. ta's international operations flourished. Tata Motors began produc- As the group's chief visionary and dealmaker, Mr. Tata aggres ing cars in joint ventures with Fiat and Daimler-Benz. Tata bought sively expanded the Tata Group into world markets. One of the 30 percent of the coal subsidiaries of an Indonesian mining com- group subsidiaries, Tata Steel, purchased the Dutch-British steel pany to supply coal for Tata's power plant in India. Altogether, the giant Corus Group, for $13 billion to establish a strong position in Tata Group has factories in numerous emerging markets, including the global metal industry. The move boosted Tata's steel-making Kenya, South Korea, Malaysia, Russia, and Thailand. capacity fivefold. Tata Consultancy Services acquired France's As one of India's largest firms, Tata has many competitive Alta SA, aiming to become a major player in Europe's information advantages, including vast financial resources and access to Technology services market. Another group subsidiary. Tata Mo. capital on favorable terms; strong corporate image: connec- fors, acquired Jaguar and Land Rover from Ford for $2.3 billion tions with countless high-quality business partners, competitive Tata Motors launched the Nano, positioned as the world's cheap cost structure, thanks to the huge, low-cost Indian labor pool: ost car. The Nano addressed a longtime dream of Ratan Tata to and long-standing relationships with national and state govern develop reliable but super-cheap automobiles and revolutionize ments in India. In the auto industry. Tata Motors' reputation is the global auto industry growing. It counts on sister subsidiary Tata Steel to provide steel satisfy government authorities. In addition to trade barrers Throughout India, Tata Group managers work cornusy dies. Import tariffs on parts and components can be sub country is awash in business regulations and administras Tata is one of the leading new global challenger firms charg- en exceeding 25 percent. Many commodities can be more only after receiving government approval. Licensing festes Russia. The emerging plants tap abundant low-cost labor tech tal procedures, and other hurdles are expensive and time-consum India has a reputation for suffocating bureaucracy and its vants are among the least efficient in Asia. The commercial ronment in India is still evolving and poses numerous hures Growing car ownership is severely straining India's already gested urban infrastructure. India's road network seems largely saturated. Third, Tata Motors' global geographic presence For decades Tata has promoted good works in India. Tata Stee spends millions every year on education, health, and agricut development projects. It has developed irrigation systems The World Bark survey on the ease of doing business ranked Inda hospitals, and electrical plants and undertaken countless others low Indian farmers to grow cash crops. The firm has built schon in the communites where it operates. The firm has a more Similary. Tata Motors undertakos various charitable active continuously to manufacture Nanos and other cars, a key ad- vantage. The purchase of Corus Group, In addition to increasing steel capacity, also greaty expanded Tata's access to automakers across and the United States. ing out of big emerging markets such as China, Brazil, India, and ent, and mineral resources to target the world's biggest growth markets increasingly Brimming with cash and confidence, they ex- port innovative business models honed in some of the world's most challenging markets. Governments and state-owned enterprises firms that do business there. influence the procurement activities of corporations. Tata capital izes on its family conglomerate networks to enhance its position as Pollution and Overcrowding government supplier in numerous business sectors. Tata Motors to absorb millions of new cars. Burgeoning car ownership in Tata Motors is India's largest automobile maker by sales. About dia and China are straining the world's already self-destructie one-quarter of all cars and trucks sold in India bear the Tata Mo carbon footprint. India suffers from severe pollution. Throughou tors brand. India's population of 1.3 billion people, most of whom southern Asia, a thick brown cloud of particulate blocks these do not own cars, represents an enormous untapped market. The altering weather patterns and causing health problems. The cou firm presently generates most of its sales outside India China and is a by-product of emissions from coal-fired power plants, con other emerging markets provide key growth opportunities. Man and trucks, and wood-burning stoves. As India industrialize. Te agement aims to transfer its vast experience in India to markets country's water, air, and soil are under increasing environments in Africa, Latin America, and the Middle East. Nations throughout pressure. Most Indians make their living from farming and po Southeast Asia appear ripe for sales of inexpensive motor vehicles. lution has reduced growth yields of rice, wheat, maize, and so Milions of low-income consumers worldwide would love to own a ghum car but have had few alternatives. Tata Motors has established manufacturing operations in Ar gentina, Brazil, Indonesia, South Korea, South Africa, and Thailand. Opportunities and Threats In each of Africa, Southeast Asia, and the Middle East, the firm has In addition to Tata Motors, several automakers have entered a significant presence in 10 or more countries. The acquisition of cheap car market in India. Nissan aims to make emerging mares Jaguar and Land Rover increased Tata Motor's visibility through a cornerstone of the its plans for global growth. Ford, Hyunda globally recognized brands and provided an entree to Europe and Toyota, and General Motors are developing inexpensive the United States cars for emerging markets. Several Chinese companies already manufacture various car models, both for export and domest Challenges consumption, and a few firms are exploring ultra-cheap options China's SAIC Motor aims to establish small-car manufacturing op In India, 70 percent of the population still lives in the country- erations in India. Japan's Suzuki sells the Maruti 800 in India for side, and the transition of land from agrarian to Industrial use often meets with angry protest. Tata Motors was forced to aban- about $4.000. India's Bajaj Motors launched the Qute, a small that sells for approximately $2.500. don construction of a factory in West Bengal, India, intended to manufacture the Nano. Protesters surrounded the new Nano plant Just as automotive sales have flattened worldwide in recent and blocked roads to prevent workers or deliveries from reach- years, many automakers have launched new models, which a ing the facility. Violence and threats to worker safety ensued for boosted global competition. Tata Motors is well positioned to ha months during plant construction. West Bengal politicos encour dle competitive threats. First, it enjoys low-cost production capac aged labor unrest, leading to capital flight and making the region ity, partly based on employing inexpensive labor in India. Second, unfriendly to business, Ultimately, despite being 80 percent com the firm has significant experience in emerging markets plete and costing $350 million, Tata Motors had to abandon the are growing rapidly By contrast, advanced economy market plant. Other challenges in India include the quality of infrastructure. Underdeveloped roads, railroads, ports, airports. power grids. subsidiaries, most of them located abroad. and telecommunications are significant obstacles to business. Indians prefer to live in cities, which strains local Infrastructure Another challenge is the continued presence of high tanffs and protectionist policies. Foreign exporters and Investors face non- transparent and often unpredictable regulatory and tariff regimes. 156th in terms of starting a business', 181st in getting construccially responsible projects throughout India. tion permits', and 146th regarding ease of international trade out of 190 countries assessed worldwide The problem has worsened due to ongoing urbanization-more Corporate Social Responsibility and Sustainability in Mijo Grenland/Innovasjon, a Norwegian electric car producer. Conclusion under the model name 'Indical solar-electric systems for buildings. The firm offers low-cost. solar-powered water pumps, refrigerators, and lanterns for areas Another group company. Tata BP Solar, makes rooftop that normally lack electricity. It has fitted 50,000 homes with $300 systems that can power lights, hot plates, and TV sets. In emerging markets and developing economies, family conglomer- ates are leveraging various advantages to dominate home-country markets. Today, the conglomerates are applying these same advan- tages to extend their reach to markets worldwide. Tata's numerous home country resources provide the firm with substantial competi- tive advantages and should allow it to perform well and capture market share from incumbent players in markets around the world. AACSB and CKR Intangible Soft Skills to improve employability and success in the workplace: Written and Oral Communication, Ethical Understanding and Reasoning, Diverse and Multicultural Work Environments, Reflective Thinking Case Questions minimize the impact of its operations on the natural environ- 8-4. Describe the various advantages that firms such as Tata em ment in Asia and elsewhere? ploy to become large industrial conglomerates. How can Tata use these same advantages to succeed in foreign markets? Sources: Rajat Arora, "Quadricycles Set to Ply on Indian Roads, Notifica- 8.5. What makes emerging markets attractive for international tion on Vehicle Standards Soon." The Economic Times, February 7, 2018, www.economictimes.indiatimes.com; Daniel Azevedo, Meet the New Chal business? Discuss emerging markets as target markets, as lengers, June 27, 2016, Boston Consulting Group, www.beg.com; Santanu platforms for manufacturing, and as sourcing destinations Choudhury and Shanoor Seervai, "Tata Motors Is Thinking 'Aspirational, 8-6. What is the relationship between trade barriers, bureaucracy, Wall Street Journal, August 13, 2014, p. B5; Lindsay Chapped, "Tata's Quiet country risk, and the emergence of Tata as a major player in Titan Is Still a Man of Action," Automotive News, March 2, 2015, pp. 1, world trade? What is the role of declining government inter- 36; "Emerging Market Multinationals: Not So Nano," Economist, March vention in Tata's success in India and its ability to internation- 27, 2009, www.economist.com; Corporate profiles on various Tata group companies from www.hoovers.com; Rishi Iyengar, "China Joins Race for alize? What should Tata do to manage country risk in India Booming Indian Car Market," CNN Money, March 28, 2017, www.cnn.mon- and other emerging markets? ey.com; Marketline, Tata Motors Limited SWOT Analysis, May 10, 2017, 8-7. Given growth rates and other characteristics of emerging pp. 1-9; Nikkel Asian Review, "Tata's Jaguar Land Rover Posts Fastest Sales markets, what markets should Tata Motors target for sales of Growth in 5 Months." December 8, 2017, www.asia.nikkei.com; S. Sen, small cars like the Nano? What country-level factors should "Tata Group: Transforming the Sleeping Giant." The ICFAI Journal of Busi- the firm consider as it evaluates the potential of various ness Strategy 6, No. 1 (2009), pp. 31-45; Alex Taylor, "Tata Takes on the World." Fortune, May 2, 2011, pp. 87-92; Tata Motors, corporate website, emerging markets? www.tatamotors.com: U.S. Department of Commerce, International Trade 8-8. As it prepares to expand abroad, how can Tata Motors Administration, India Country Commercial Guide, July 25, 2017, www. improve its corporate social responsibility toward future export.gov. Note: This case was authored by Marta Szabo White, Ph.D., customers in emerging markets? What can the firm do to Georgia State University, 8-7. Given growth rates and other characteristics of emerging markets, what markets should Tata Motors target for sales of small cars like the Nano? What country-level factors should the firm consider as it evaluates the potential of various emerging markets? houann Tata Motors