Leverage 'one Tata': Chandra to group CEOs

Chandra asked the companies to simplify their structure, become agile and cultivate accountability

Tata Sons Chairman N Chandrasekaran has asked group chief executive officers to collaborate, so that the group can leverage ‘one Tata’. 

Chandra, as he is known, was speaking to the top leadership of over 100 companies at the Tata Annual Group Leadership Conference on Saturday. Organised to commemorate J R D Tata’s birth anniversary, is the platform where the group’s vision and strategy is presented. It is also the platform for rewarding group companies that excel on the Tata Business Excellence Model.

Chandra was addressing the summit for the first time. Thirty years after joining Tata Consultancy Services, where he became managing director in 2009, Chandra became executive chairman of Tata Sons on February 21.

“Chandra emphasised the need for the group to leverage ‘one Tata’ to achieve full potential for group companies,” said one of the attendees.

 

While outlining a vision on how companies could achieve their full potential, he emphasised on the pioneering spirit of J R D Tata and asked the companies to introspect if their financials were those of a leader, the attendee said. 

 

Chandra asked the companies to simplify their structure, to become more agile and develop a culture of accountability. He asked them to put customers first and develop a digital strategy to ward off competition. He also spoke on leadership development through attracting and grooming quality talent. 

Addressing shareholders in the company’s 2016-17 report, Chandra had said Tata Motors’ standalone net revenues increased by 3.7 per cent to Rs 44,777 crore for the 12 months ended March 31, but the standalone loss before tax for the year was Rs 2,421 crore, compared with Rs 67 crore in the previous year.

“In the domestic business segment, turnaround is the need of the hour and the management is working with renewed focus and energy to improve our market share, reduce our cost base, streamline the supply chain and ensure launch of products on time to delight our customers,” Chandra said.

Tata Sons is the primary holding company for Tata Group that had $104 billion annual turnover last financial year, a 

67.3 per cent of it was generated outside India. It has operations in over 100 countries and employs over 0.6 million people across the world.

The company’s market share in commercial vehicles (CV) segment has fallen to 44.4 per cent from a high of 59.4 per cent in FY12, while market share for passenger vehicles (PV) declined to 5.2 per cent from 13.1 per cent in the same period, he said. He said that a series of actions taken by the management team would show an improved performance in both the CV and PV segments in India and would deliver better financial results.

Expressing similar views, Tata Motors Managing Director Guenter Butschek said: “Our immediate priority now is on execution — to address the top concerns of supply constraints, to advance the launch time of some of our new products. In full alignment with the board, we have finalised a business turnaround plan through which we take upon ourselves to deliver a robust bottom-line improvement in FY17/18.”

Butschek said one of the most important initiatives in 2016-17 was the organisational effectiveness (OE) exercise, with the objective of bringing “the much needed empowerment and accountability within the business unit, strong functional oversight based on the key principles of speed, simplicity and agility”.

 

“Due to its magnitude and complexity, the transition of the new management structure w.e.f. from April 1, 2017 faced some challenges, which in the meanwhile is getting addressed on a case to case basis,” Butschek said.

While challenges such as demonetisation and transition to BS IV affected business, Butschek also admitted that Tata Motors did not adequately react to the changing environment.