Organization Analysis and Technology Review

Executive Summary

In this paper, focus has been given to the IT scope of the Tata business. A study has been done to establish the extent to which the company has embraced IT in its functioning and the benefits it gets. The first part of the paper discusses Tata’s business, its external environment and a PEST analysis of the business. A general focus of the position of the business in relation to its environment is also discussed. The second part is a discussion of the company’s IT use. It is found that despite the many departments and diverse industries that Tata ventures into, information technology is a priority, with a whole segment involved in outsourcing and research of such technology and more than 200 staff focusing on this area.

Buy this excellently written paper or order a fresh one from ace-myhomework.com

The Tata Business

Tata is among the Indian conglomerates that have been seen to expand drastically. Its business is in advanced composites, aerospace, agricultural products, automotive industry, beverages, books, chemicals, industrial equipment and others in various industries. It has acquired different businesses abroad, from manufacturing to consultancy. For instance, Tata Motors acquired the truck division of the beaten Daewoo of Korea in 2003, Tata steel has acquired steel mills in many places including Europe, and Tata Tea bought Tetley Tea in 2000 while Tata consultancy has spread its tentacles all over. In UK for instance, Tata consultancy employs over 5,000 staff. Tata UK is the country’s biggest manufacturer and employs over 40,000 workers. Adding 5,000 in consultancy and services, this brings a total of 45,000, all under the umbrella of Tata. Tata now also owns the steelworks at Stocksbridge. Just recently, Land Rover which was also acquired by Tata launched the Evoque, which is a mini sports utility vehicle and it attracted twenty thousand orders even before it went on sale (Tata Motors, 2006). Such a large firm calls for well integrated and top level information technology. The study of Tata use of information technology is therefore representative of a multinational and fast growing firm.

PEST Analysis

Political-legal

In terms of entry barriers there may not be much lobbying to do to enter international market even though they will have to have their products approved by the appropriate agencies before they are allowed to enter. This may include some modifications as specified by the agencies. A company that is trying to keep a competitive advantage may not succeed well especially if they are also trying to be among the cheapest (Chaudhuri & Muthukumar, 2004).

Economic

Tata, like many other companies, is faced with economic hardships that have to be overcome. Shrinking budgets and higher demand for better technology is one major crisis that will have to be well handled to remain competitive and profitable. Even though the economic crisis can be used to market cheaper cars, Tata may have to adapt its strategy keeping in mind that this will also affect their business in other ways; for instance, the exchange rates, inflation and GDP trends. This is a crisis in itself because the company might be considering the job creation it will bring through entering the market (Biswas, 2005).

Social

Tata will have to look into the environmental footprint since there are current trends of higher environmental requirements. In the car segment for instance, if their car is not environmentally friendly, it may receive a cold reception from an environmentally aware clientele (Dunning, Hoesel & Narula 1998).

The company may therefore have much to do with corporate social responsibility. The company might need to do something about its image as compared to the home brands so as to counter the sour attitude or comparison of home versus Indian products. Information technology can play a major role in marketing especially through the internet.

Technological

Tata group has discovered its own line of technology products. It is important to study and align their IT products with already existing technology to enable compatibility. In the car segment, more research and development will be required to bring such a product into the market if it will have to be competitive in the long run especially due to the presence of the electric Chevrolet Spark. Engine technologies are also changing fast and they need to adapt to this change so that they do not become obsolete in the fast changing arena (Chaudhuri & Muthukumar, 2004).

TATA’s Position in Relation to its Environment

The internal environment includes its strengths and weaknesses in management, strategy and products. In its alliances, the company enhances product portfolios for the two companies. For instance, it made an agreement with Fiat to build a pickup together that was designed for its Central and South American market in 2007. Other than product manufacturing, Tata Group offers consultancy services in IT. It not only outsources its IT but it has a whole department that is charged with IT innovations within the company.

One of their weaknesses is that the passenger cars that Tata Motors offer are often produced on lower generation platforms which would not allow it compete strongly in a market where competition is strong. Tata has also not been able to enter luxury car segment even after acquiring Jaguar and Land Rover. This is perhaps because people associate it with heavy commercial vehicles (Schonfeld, 2011).

The external environment too consists of strengths and weaknesses. The increase in oil products for instance can be considered to be a blessing in disguise, especially in America. As Tata corporation intends to introduce the low consumption Tata Nano. The economic challenges facing America calls for more jobs and the entry of Tata could not be such timely as now (Greer, 2002).

In globalizing, Tata is a fast learner and takes its lessons from among others, Daewoo. It is able to diversify from metal to tea, from chemicals to hotels and several other lines of investments. Tata has been able to exploit online based information to study markets and so design products tailored to these markets.

One of the big threats is the shift from big cars to smaller, compact cars which is becoming the trend of many manufacturers. The emergence of new technology electrical engines by Chevrolet is a looming threat. Since it is a home car, Americans might favor the Chevrolet over the Indian Tata even though they have the same specifications. The electric engine might also receive more attention with greater environmental awareness today (Dunning, Hoesel & Narula, 1998).

The company also faces serious problems in parochialism where the top management is dominated by Indians. If Tata was to effectively go the global way, IT could help get the ratios of personnel nationality. The diversification could also be counted as a disadvantage; Tata seems to be dragging both performing and non-performing sectors along. Some examples are Tata Teleservices and Tata Financial services (Windecker, 2011).

Technology Analysis of TATA Group

The Tata Consultancy Services (TCS) is especially charged with the outsourcing and internal improvement of the IT solutions of the company. The company has off-the-shelf and also user-customized information technology solutions alongside products for various industries. They fall under IT enabled services and IT products and services. Tata employs a wide usage of IT in the areas of data management, application management, converged network, Enterprise Management, Managed Security, end-user computing and has an IT Service Desk (Nieuwenhuis & Wells, 2003).

Human resources and operations departments

In its human resources department and in operations, Tata uses transformation solutions and is equipped with up-to-date technologies like cloud computing. This enables consolidation and standardization of activities with good rationale. Tata is keen to use payroll management applications. The company is also able to use e-learning to provide requisite knowledge especially for its managerial staff. The two departments have benefited in the following ways by using IT (Tata Motors, 2006):

 Their processes are predictable and standardized

 The on-demand environment solutions enable them to meet changing business needs.

 Total cost of ownership is reduced by the transparent infrastructure solutions.

 Due to integrated service delivery model, business performance is capable of being linked to the right source.

 The company no longer struggles to reach the ‘to be’ state and is always on the ‘as is’ state.

 There is improved service delivery due to continual improvement and innovation.

Technology in the sales and marketing departments

Tata seems to favor ERP technology. According to the company its reason to implement ERP was to avail real time data that was absent between departments, enhance information flow in the sales, finance and production planning and also link it to other manufacturers of similar products (TATA Consultancy Services, 2011).

The company uses SAP as its ERP package of choice. This package enables it to manage complete order to delivery process of its products, handle warranty claims, and enhance an efficient dealership management. This package is also used to manage customer and partner relationships. Tata has benefited in the following ways from using the SAP ERP:

 SAP has provided strong IT infrastructure that has supported the company’s aggressive efforts of globalization.

 There have been improvements on the general costs, purchasing, resource planning and even logistics.

 The program is able to provide financial information with precision

 More than 3000 users of Tata Motors and equipment use SAP solutions and this allow matching of processes and understanding (Tata, 2011).

Managed security

Data protection is a sensitive area for almost all companies. There is need for the right infrastructure to enhance the integrity and confidentiality of data. There is need to create flexibility due to changing environment. Inefficiency of manual security management and the difficulty it creates in meeting high standards necessitates an appropriate technology to provide compliant regulations. Tata has employed its global network delivery model (GNDM) as a solution to these. This model is involved in security device monitoring and management, vulnerability management, and security information and event management. By so doing, it has attained the following business values (Tata, 2011):

 It has been able to streamline security incident and also event handling processes.

 There is increased flexibility and responsiveness.

 Data privacy and integrity have been enhanced

 Operational issues are more compliant and visibility into security has been enhanced.

 The overall operational costs have drastically been reduced.

Converged network

This helps to bring together voice, data, and video alongside other multimedia communication applications. This is targeted to increasing efficiencies, reducing expenditure, and enhancing interactions among employees, customers and other parties involved in business functions. It is an alternative to traditional call routing and endpoints. It brings about system integration and better quality services. Tata implements convergence of network and realizes the following business values (Tata Motors, 2006):

 The unified communication reduces communication costs.

 The total cost of ownership is reduced due to the reduction of the management and support costs and also due to bandwidth optimization.

 Communication is simplified from the traditional complex network to a single common infrastructure.

 The communication infrastructure becomes secure and flexible.

Application management

In its bid to align its IT to its business objectives, Tata engages in application management and finds support in resolving complex application development. There is increasing dependency on IT in the management of the company’s investments (TATA Consultancy Services, 2011). This requires that all applications being used by the company be at their peak performance. Tata realizes the following from this practice:

 A higher return on investment (RoI) and increased productivity.

 Low service downtime

 There is accurate assessment of change

IT service desk

Tata has a single point contact for all issues that are related to IT both internally and to customers. This ensures continuous improvement and service to the various points in need. It helps lower the cost of ownership. The benefits of an IT desk are metrics-based governance, riskaverse transition approach, and high ability to attract and also retain good talent from the population (Tata, 2011).

Conclusion and Recommendations

Tata represents a good example of what any company that intends to survive changing times has to do. Its research and development of IT solutions is tailor made to the needs of the company and makes it innovative enough to cope with competition. The company will stand better chances if human resources management embraced more IT solutions to manage its vast resource.

Despite the vast potential in the world of social networking, Tata seems not very keen to exploit it as a means of marketing. The generation that is keen on social media use is most likely to be keen on such products as the electric car. Another new IT product that the company could adopt is the context aware applications that understand the user’s interest graph. Even though Tata embraces e-commerce, social media remains the current most used internet avenue it could use to market its various products.