From the editor

nother predictably hot summer is upon us here in India and the climate
has got hotter still as the worlds largest democracy goes to the polls.
It appears that we are in for a season of change and, from an economic
standpoint at least, a sense of guarded optimism touches the blistering wind.
We at Tata Review reckon this is as good a time as any to cast a forward look
ATWHATTHENANCIALYEARAHEADMAYHAVEINSTOREFORSOMEOFTHEBIGENTITIES
INTHE4ATAGROUPANDTHATISTHELOGICBEHINDTHEPACKAGEOFINTERVIEWSWE
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0OWER4ATA#HEMICALS4ATA'LOBAL"EVERAGES4ITAN#OMPANY4ATA#APITAL4ATA
International, Tata Projects and Tata Technologies.
The seamless connect between the world of business and the community
for so long a cornerstone of the Tata way is explored through our feature
ONf4HE0OWEROFgCAMPAIGNCRAFTEDANDSUSTAINEDBY4ATA'LOBAL"EVERAGES
AND4ATA4EA4HISAWARENESSINITIATIVEHASANOBLEANDTIMELYAIMTODELIVERTHE
power of informed choice to as many as possible of the hundreds of millions
OFWOMENVOTERSWHOMAKEUPAROUNDPERCENTOF)NDIAgSVOTINGPOPULATION
which explains the 49 in The Power of 49. As refreshing and welcome as the
cup that cheers, the campaigns multidimensional scope and spread has made it
an unusual success in a sphere that cries out for attention.
!NOTHERMUST READISTHECONVERSATIONWITH.IRMALYA+UMARHEADOFSTRATEGY
ANDMEMBEROFTHE'ROUP%XECUTIVE#OUNCILAT4ATA3ONS!MUCH ADMIRED
ACADEMICAPROLICWRITERANDONEOFTHEWORLDgSFOREMOSTTHINKERSONSTRATEGY
ANDMARKETING$R+UMARSHARESHISWORLDVIEWONGROWTHANDHOWTOEXPANDTHE
pathways to success in the global arena of business. And theres a special report
ONINNOVATIONINWHICHTata ReviewCAPTURESTHREEDISTINCTPERSPECTIVESTHATOF
an enabler, a facilitator and an implementer.
#ONTINUINGWITHTHECOMMUNITYTHEMEWEHAVEAHEARTWARMINGARTICLEON
HOWMORETHANPEOPLEFROMACROSSTHE4ATAGROUPCAMETOGETHERINA
REMARKABLEINITIATIVETHATENCOURAGEDPEOPLETOVOLUNTEERTHEIRTIMEANDENERGIES
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conditions.
)TgSAVARIEDMIXWEHAVEPUTTOGETHER7EDOHOPETHESTORIESINTHISISSUE
are engaging enough for you to better understand the world of Tata.

Warm regards,

#HRISTABELLE.ORONHA

Contents

VOL 52 | ISSUE 1

Cover story

Special report

57

FULL SPEED AHEAD

R Gopalakrishnan, chairman,

ten Tata companies talk

Tata Group Innovation Forum;

about the performance

Ravi Arora, vice president at Tata

year gone by and their

plans for the future
7

INVESTED IN INNOVATION

The chief executives of

of their companies in the

JAGUAR LAND ROVER

10 TATA CAPITAL

APRIL 2014

Quality Management Services;

Anant Krishnan, chief technology
QHEGTQH6%5CPF-CTN-QGJNGT
chief executive of Tata Steel
Europe, talk about innovation
initiatives at the Tata group
Gayatri Kamath, Nithin Rao,
Shubha Madhukar

13 TATA POWER
16 TATA INTERNATIONAL
AND TRENT

Business
39 TATA HOUSING

20 TATA CHEMICALS

DEVELOPMENT
COMPANY:

24 TATA GLOBAL
BEVERAGES

FOR A GREENER
WORLD
Shilpa Sachdev

27 TATA PROJECTS
42 CMC: ENGINEERING
30 TATA STEEL

MUCH-NEEDED

33 TATA TECHNOLOGIES

Nithin Rao

SOLUTIONS

36 TITAN COMPANY

46 TATA GLOBAL
BEVERAGES: VOICE OF
THE 49 PERCENT
Vibha Rao

50 TATA GROUP:

In conversation
68 INDIA MUST BRAND

THE DEFENCE

ITS NATURAL AND

CONNECTION

CULTURAL RESOURCES

Nithin Rao

Dr Nirmalya Kumar,
member, Group Executive

54 TITAN COMPANY, TATA

%QWPEKN6CVC5QPUQRGPU

GLOBAL BEVERAGES,

up in this interview with

TATA TECHNOLOGIES,

Christabelle Noronha on his

TATA ELXSI: INSPIRED

role in the group, the Indian

BY DESIGN

business environment and on

Rishi Vora

living and working in India

Perspective
Community

EDITOR
%JTKUVCDGNNG0QTQPJC
Email: chris@tata.com

85 THE ECONOMY:
A ROUGH SEA AHEAD

ASSISTANT EDITOR

Siddhartha Roy

Sujata Agrawal

88 TECHNOLOGY AND IPRs

Subramaniam Vutha

EDITORIAL TEAM
Anjali Mathur
%[PVJKC4QFTKIWGU

90 REVISITING Pi
72 TATA TRUSTS:

Nirav Shah

Gayatri Kamath
Jai Madan

EMPOWERING

2JKNKR%JCEMQ

MIGRANTS
Shalini Menon

Debjani Ray

Book review

Sangeeta Menon
Shalini Menon
Shubha Madhukar

92 LEADERS EAT LAST:

76 A RICH

WHY SOME TEAMS PULL

CONTRIBUTORS

VOLUNTEERING

TOGETHER AND OTHERS

Nithin Rao

TRADITION

DONT

Rishi Vora

Cynthia Rodrigues

Shalini Menon
DESIGN
Abraham K John
Shilpa Naresh
PRODUCTION

Photofeature
79 TAJ GROUP: MADE FOR ROYALTY
Sujata Agrawal

Mukund Moghe
EDITED AND CREATED BY
in association with
6JG+PHQTOCVKQP%QORCP[
Email: grouppublications@tata.com
Website: www.tata.com
CONTACT
Tata Sons
Bombay House
24, Homi Mody Street
Mumbai 400 001
Phone: 91-22-6665 8282
DISCLAIMER
All matter in Tata Review is
copyrighted. Material published
in it can be reproduced with
permission. To know more,
please email the editor.

Full speed ahead

After years of sluggish performance, the global economy seems
to be on the mend. Financial markets are doing well and optimism
is in the air. In keeping with this upbeat global mood, Tata chief
executives are busy preparing the ground for their companies to
push the pedal on growth.
In a series of interviews with Tata Review, 10 Tata chief executives
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they are preparing for the future.

COVER STORY

We continue to expand our

global footprint
Speth attributes the success
to stunning new products
with innovative technologies.
Excerpts:

For Jaguar Land Rover (JLR),

a subsidiary of Tata Motors,
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of solid performance, with
record growth in all six of its
key regions. In an interview with
Sangeeta Menon, CEO Dr Ralf

How would you describe the financial

year that has just ended? What were
the key highlights for JLR?
We can reflect upon a solid performance.
Stunning new products with innovative
technologies characterised the year, among
them, the all-new Range Rover Sport, the Jaguar
F-TYPE convertible and coupe, and the peerless
long-wheelbase Range Rover Autobiography
Black.
We won over 200 awards for our products,
including the coveted Golden Steering Wheel
award for the Jaguar F-TYPE. I am also proud
that Business in the Community, a UK charity,
named us Responsible Business of the Year, a
significant accomplishment for us as we grow the
business responsibly.
We continued to invest heavily to support
product actions and to expand our global
operational footprint. We reached an agreement
to build a plant in Brazil, and both our Chery
Jaguar Land Rover plant in China and our engine
manufacturing facility in the UK are rapidly
approaching prototype test builds.

April 2014 

Tata Review

COVER STORY

It is the passion and commitment of our

employees that sets us apart. We welcomed more
than 3,000 new hires as well as 422 apprentices
and graduates into JLR. We have more than 1,000
people currently on our apprentice and graduate
programmes, and group-wide academies now
set up to assist employees with their personal
development, online and in classrooms.
During the year, British Prime Minister
David Cameron inaugurated our latest training
centre in Beijing. In fact, we invested 20 million
in learning and development in the last fiscal
and provided leadership programmes to 2,500
leaders across the company.
All of these achievements and milestones
are driven by a desire to deliver class-leading
products, which will provide experiences our
growing customer base will love for life.
JLR sold more vehicles to more
customers than ever before during
the year. What do you attribute this
success to?
The JLR business is driven by great British
products, designed, engineered and manufactured
by a skilled workforce. Right now we have our
strongest-ever product line-up, giving customers
what they want. We have introduced a raft of
new technologies in our vehicles, including
stop-start, across the entire range, AWD Jaguars
for the snow-belt of North America, active drive
line and nine-speed gearbox on the Land Rover
Evoque and the worlds first diesel hybrid SUV.
Our relentless focus on quality was recognised
by Jaguar being awarded the status of Number 1
brand in the JD Power survey in the UK.
How important are design, technology
and innovation in shaping the future
of the auto industry? How will these
factors influence JLR cars?
Innovation is critical to all parts of the
business. Innovation is the very best response
to the changing world around us not just
commercially but environmentally, economically
and socially. The drive for improvement
offers significant opportunities to reach new
customers, as our vehicle range broadens.

April 2014
8 Tata Review 

This is an incredibly inventive business.

We are pioneers in aluminium construction and
lightweight materials; we are delivering better
aerodynamics, rolling resistance, crash safety
and connectivity technologies.
At JLR, an unrelenting focus on design,
technology, innovation and quality is absolutely
integral to our business. It is this focus that
has seen JLR reach consumers in more
global markets than ever before. It is only by
maintaining a cohesive strategic approach to
all of these elements that we will continue to
engineer and craft beautiful vehicles that meet
the exacting demands of our customers.
How invested is JLR in understanding
and anticipating customer needs?
At JLR, the customer is at the heart of everything
we do. It is essential that customer attitudes
and opinions are taken into account in the
development of our vehicles. We invest heavily in
understanding existing and potential owners, to
ensure that the companys products are perfectly
suited to their needs. Our customer insight team
works across 20 markets worldwide, spending
many hundreds of hours each year with target
customers, getting to know who they are and
what they want from our cars. Through detailed
research we gain an excellent understanding of
how premium car buyers perceive the Jaguar and
Land Rover brands.
The team produces ethnographic films and
booklets on target customers to help the wider
business connect more easily with customers.
This information is a vital tool for the design,
engineering, marketing and sales teams to better
understand consumer motivation and behaviour.
Placement graduates known as insight
advocates also work within the research teams.
Research clinics are conducted during the
model development phase. For one of JLRs
upcoming models, customer insight processes
have been ongoing since 2012, progressing
from ethnographic interviews and concept
confirmation clinics, through to clinics for
theme, package, marketability and volume,
to target customer interviews. Every insight
gained is invaluable; by enabling Jaguar Land

COVER STORY

Rover to deliver exactly what customers want,

the customer insight teams help build customer
satisfaction and brand loyalty.
Could you tell us a bit more about the
plans for Brazil and how the
enhanced capacity will fuel future
growth for JLR in various markets?
Brazil is a key strategic market with strong
potential for JLR and we are to become the first
British carmaker to open a manufacturing facility
there. This new facility will play an important role
in supporting the significant growth opportunity
identified in Brazil and across other South
American markets. Construction of the premium
manufacturing facility will commence in mid2014. The first vehicles will come off the assembly
line in 2016, subject to the final approval of the
plans from the Brazilian Federal Government
under its Inovar-Auto programme. The new
plant will have a capacity to build 24,000 vehicles
annually for the Brazilian market.
SUVs are very popular in Brazil and as a
result, JLR has had a presence there for more
than 20 years. Brazil was our eighth-largest
single market last year, selling more than 11,611
vehicles, a 41 percent increase. In 2013 Land
Rovers share of the SUV segment stood at 53
percent and over the last three years, JLR has
seen a sales increase of 118 percent. Without
a manufacturing presence in that market,
import regulations would impact our ability to
maximise our potential for customers here and
across the South American markets.
China has been an important factor
for the JLR growth story. How do you
see the market contributing in the
years ahead? What will be the other
focus markets for JLR?
We are a global business operating in more than
170 markets. In 2013 we saw growth in all six
of our key regions with new records set in 38
markets. Our top markets were China, the UK,
the US, Russia and Germany. However, we saw
the most significant year-on-year growth in Japan
(up 56 percent), South Korea (up 63 percent),
Brazil (up 41 percent), and the Middle East and

An unrelenting focus on design, technology,

innovation and quality is integral to our
business. It has seen JLR reach consumers
in more markets than ever before.
North Africa (up 46 percent). In the coming year
continued investment in new product actions
will see us continue to focus on growth in both
established markets such as the US and emerging
markets like Brazil, Russia and India.
Given the increasing awareness
related to sustainability, what kind of
challenges will the auto industry, in
general, and JLR, in particular, face
in the future?
This is a key priority for the entire global
automotive industry. At JLR, we are investing
in a range of new technologies that will deliver
a step change in improving the sustainability of
our products. We are also making significant
improvements in our manufacturing facilities
and logistics operations to reduce emissions,
including carbon dioxide.
The UKs largest rooftop solar panel
system, installed at our new state-of-the art
engine manufacturing centre, has been designed
with sustainability embedded throughout and
has recently been awarded an excellent rating
from the BREEAM design stage assessment for
sustainable buildings.
Over the past five years, we have reduced
fleet CO2 emissions by 23 percent and operating
CO2 emissions by 21 percent. Waste to landfill
has fallen by 75 percent and water consumption
by 17 percent. The companys Environmental
Innovation Strategy to 2020 aims to use less
resources and create zero waste as well as reduce
its dependency on fossil fuels. Jaguar Land
Rover will continue its efforts to improve its
CO2 and fuel economy levels to meet the needs
of its customers and deliver on its legislative
obligations. We will achieve this by increasing
our use of lightweight technologies, engine
downsizing and hybridisation.

April 2014 

Tata Review

COVER STORY

Our aim is to be among the

top five NBFCs in India
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a book size of `290 billion. Its
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before tax of `3.53 billion.

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April 2014
10 Tata Review 

Praveen P Kadle, NBOBHJOH

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COVER STORY

How did the company perform in

financial year 2013-14?
It was a challenging year for us as the economy
saw a significant downturn. Both inflation
and interest rates were on the higher side of
the spectrum, so we had to make significant
impairment provisions for the investments
that were already made and also for the nonperforming assets, which dented our profitability.
In terms of revenue, we grew by 8 percent, in
terms of operating profit we grew by 4 percent,
but if we look at it from the standpoint of
consolidated profits before tax, there was a decline
of about 15 percent.
Do you see significant improvements
in financial year 2014-15?
We do not see any improvements in the economy
in the short to medium-term period. On an
overall basis, the economy will remain subdued
this year as coping with inflation is going to be
a challenge. Interest rates will continue to be on
the higher side and flexibility to reduce rates or
improve liquidity in the market may not be there.
But we are confident we will make significant
improvements in our performance this fiscal
as compared to last year. We have identified
pockets where we can do business in a profitable
manner. In terms of book growth, revenues
and profitability, we believe we can see a lot of
improvements by reducing costs and intensifying
focus on collections and recovery.
Do you expect a decline in gross and
net NPAs this fiscal?
We plan to reduce our gross NPAs by 2025 percent this year. As far as net NPAs are
concerned, we need to grow our provision
coverage from 20 percent to 50 percent in three
years. This will help us grow even in a more
challenging economic situation that may arise in
the future.
How would you assess the
performance of your subsidiary
companies in the current fiscal?
Tata Capital Housing Finance has done
exceedingly well. In spite of the demand for

housing finance being on the lower side in 201314, it has performed well and met its targets.
Housing finance is one of our key growth areas,
and we are quite pleased with its performance and
are confident that it is poised to grow significantly.
Our home loan portfolio is around `66 billion;
we need to take this to `210 billion by the end of
March 2017. To achieve this target we will need
to increase our productivity and improve our
market coverage by tying up with many more
builders, and we will need to bring down our
cost-to-income ratio and keep a constant eye on
NPAs, which at present is less than 0.5 percent. As
a strategy for growth, we are intensifying focus on
smaller towns and rural areas of India.
Tata Capital Financial Services is our main
subsidiary and we feel there is potential to bring
it back on track this fiscal. To increase its revenue
and book size, we will need to consolidate our
position in areas such as acquisition financing,
promoter financing and structured financing.
Syndication for our corporate clients is another
area where we believe we can do well. There is a
lot of scope in our traditional lines of business,
which includes channel financing, vendor
financing and trade finance.
How has your Singapore subsidiary
fared during the fiscal? And what is
the growth you are expecting from
private equity and venture capital
funds in India and abroad?
The Singapore subsidiary has done quite well.
We also have a proprietary investment portfolio,
which invests in Indian and foreign currency
debt-paper of the government, public sector
undertakings and even well-managed private
companies. On a consolidated basis, our original
investments have grown by 50 percent and we are
generating nearly 28 percent return on equity. The
subsidiary contributes handsomely to the overall
bottom line of the company.
Our private equity and venture capital funds,
both domestic and international put together, have
a commitment from investors of about a billion
US dollars. We have invested over 40 percent of
this corpus. By the end of fiscal 2014-15, we expect
the percentage to increase to about 80.

April 2014 

Tata Review

11

COVER STORY

Themes for growth push

Tata Capital has launched several themes for 201415 to overcome sluggish business growth, caused by
a slowdown in the Indian economy, says Tata Capital
MD and CEO Praveen Kadle.
Growing cross and repeat sales in a big
way: 6DB@MCN@RHFMHB@MS@LNTMSNEBQNRR
and repeat-sales across different business lines
in both corporate and consumer segments. This
would improve the topline and keep costs on
the lower side.
Using the Tata ecosystem: We not only
look at Tata companies, but also vendors,
business partners, dealers, distributors and their
customers and employees for new business.
Deploying the digital platforms effectively:
Through this, we are also looking at building
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mobility and social media to build customer
advocacy and customer-centricity.
Analytics: We have a rich database relating to
our customers across our businesses. We will
use that to improve the topline, reduce costs,
and also get early signals about the quality of
the customers.
Strong foray into the infrastructure space:
We own 80 percent in Tata Cleantech Capital,
a joint venture with the International Finance
Corporation. The company currently looks
at renewable energy, waste management
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among other areas. There are many segments in
infrastructure, including roads, ports, airports,
power generation and irrigation, where we
can play an effective role. We also have an
existing infrastructure portfolio. We are currently
exploring bringing together both the expertise,
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cohesive and strong manner.


April 2014
12 Tata Review 

What are the international alliances

and the partnerships that Tata Capital
has entered into?
We have a key alliance with the Mizuho Financial
Services group with whom we have a strong
affiliation for investment banking and private
equity. In 2013-14, we started a leasing business
along with Century Tokyo Leasing Corporation,
which is a part of the Mizuho group. In the
same fiscal, under Tata Cleantech, we partnered
with the International Finance Corporation,
Washington DC, which is a member company of
the World Bank group.
Where does Tata Capital stand as
compared to its peers in terms of
leadership in business?
We are among the top 10 NBFCs in India,
though we were one of the last entrants. Our
competitors have been around for 30 years. Our
aim is to be amongst the top five NBFCs in
India, and we want to get there as soon as
possible. While we work towards that goal, it is
important for us to not compromise on the
quality of our books and our non-financial
strengths.
What are the steps being taken to
achieve benchmark positions in the
area of innovation, employee
engagement, etc?
At Tata Capital, we have laid strong emphasis on
employee engagement from day one. We
recently concluded our annual Employee
Engagement Survey and achieved a grand mean
score of 4.15, which places us in the 58th
percentile of Gallups global database, an upward
movement of 9 percentile points compared to
the last year. We have received a PCMM (People
Capability Maturity Model) Level 3 certification,
the first among NBFCs. Our much-talked about
Do Right initiative, which is an extension of our
mission and brand philosophy (We only do
whats right for you) was recently featured in
the global Facebook Studio Gallery and that
further highlights how we have set a strong
industry benchmark as far as innovation is
concerned.

COVER STORY

We will rekindle the spirit

of growth this year
up, including new markets and
opportunities, and challenges
posed by the Mundra Ultra
Mega Power Project.

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year 2014-15 could well be
a landmark year as it gets
ready to go back to growth
mode. Managing Director Anil
Sardana speaks to Sangeeta
Menon about the plans lined

How would you describe the year

that has gone by for Tata Power?
Tata Power had an ongoing challenge with one
of its largest investments, the Mundra project;
one of our key priorities was to find a solution
to the large under-recovery on account of
fuel. In April 2013, the electricity regulatory
body issued its first order adjudicating that a
compensatory tariff would be applicable to stem
under-recovery owing to the significant change
in fuel costs. A committee formed to look into
the implementation of the compensatory tariff
issue submitted its report in August, following
which the report was submitted for a final order
of the central regulatory body. The final order,
which came in February 2014, was positive for
Tata Power. From that perspective, 2013-14
becomes a landmark year for us. We now await
the implementation of the order.
Besides that, we went to our shareholders
for the first time since 1994 with a `20
billion rights issue, sold one of our Indonesian
coal mines for about $500 million and acquired
two other new mines at a relatively lower price
of $150 million. On the distribution side, there

April 2014 

Tata Review

13

COVER STORY

was money that consumers owed us in the

form of regulatory assets; the Delhi regulatory
authority took cognisance of this and said these
would be amortised over the next eight years,
thus bringing clarity on the matter.
Going forward, we will hopefully have
the cash and the company can look at growth,
which was kept under check in the past few
years as we wanted to preserve cash.

most competitive formats of generation. To that

extent, it has its own importance.
The company would need to cope
with ongoing losses despite compensatory
tariffs, which would accrue on account of
rupee depreciating exponentially in the last
18 months. One expects to overcome these
challenges by enhancing efficiency and
improving sales in the open market.

The Mundra project has been quite a

challenge and a concern for Tata
Power. Are there still worries on that
front? What is the plan to mitigate
these?
Mundra is a very large investment. It is a 4,000
megawatt project in a single location, with
features such as water being drawn from the sea,
a dedicated jetty from where coal is transported,
and so on. Its built on a very large scale. Such
large infrastructure projects do pose challenges
in terms of building acceptability in the
neighbourhood, maintaining the infrastructure
and in ensuring that dispatch of power on a
large scale happens on a continuous basis. We
also have to contend with a large number of
NGOs that have got involved because of the
large scale of the project.
While there are challenges, Mundra
has a distinct advantage it contributes
almost 3 percent of the countrys total power
requirement from one location, in one of the

Tata Power also forayed into

international markets last year. What
is the progress on that front?
We entered Africa, Turkey, Myanmar and
Vietnam. Work on these projects has started.
The learnings from these ventures will, in the
coming years, help us decide whether to pursue
internationalisation or remain focused on
India, which, theoretically, still has plenty of
opportunities. In terms of other new markets,
we will only enter a market if there is a higher
return on investment with a lower risk that can
be managed. At the same time we want to ensure
that we dont just acquire a one-off asset for
the sake of having a presence; the idea is have
significant presence in a market.

Tata Powers Mundra power project in coastal Gujarat is

Indias most energy-efficient, coal-based thermal power plant

April 2014
14 Tata Review 

What are your priorities for the

current year?
This year we will rekindle the spirit of growth
in the company; we will be exploring more
opportunities this year. Power and energy
continue to be major challenges across different
geographies, particularly in developing
economies. Even in a mature market like South
Africa, not enough power is available, and that
gives us an opportunity to look at greenfield
projects and also acquire and manage projects
that are in distress. In the next one or two
years, Tata Power will focus on acquiring assets
which we can transform and turn into good
opportunities.
On the softer side, Tata Power has been
engaged in an initiative to realign the culture of
all the companies and subsidiaries within our
fold. With operations and projects in several
locations, it is important that we have one
common culture to address our value system.

COVER STORY

We have a chief culture officer in Tata Power,

which clearly demonstrates our commitment
to achieving this. Safety has been another key
agenda at Tata Power and we will continue to
focus on that aspect.
What is your view on the recent
development where the Delhi
government raised questions about
power tariffs in the state by calling
for an audit of the distribution
companies?
That doesnt impact our business. As per the
rule, distributors are expected to administer
the subsidy to the customer only after being
paid up-front. The long-term phenomenon
of providing subsidies, however, is bad for the
power sector. Subsidies are good for the needy
sections of society, but beyond that it empties
the Governments treasury, makes consumers
inefficient and will eventually affect the
performance of state electricity boards, making
it difficult for them to meet the demands of
expansion and maintenance targets.
What do you see as the challenges
faced by Indias power sector?
The Indian power sector has been going
through a lot of changes, particularly on
account of fuel. The countrys energy security
policy needs realignment. Power is a subject
where the Centre dictates policy, but decisions
are taken by states.
So the states follow a myopic approach,
using whatever option is available on the most
immediate basis and leaving out whatever is
expensive and requires a bit of effort. When we
leave those types of opportunities out, we risk
using up one type of fuel resource completely
or totally leave out options that are needed for
a cleaner tomorrow.
The other problem is that the sector is
almost 90 percent controlled by state-owned
enterprises. The way these state-owned
enterprises are set up, they are confronted with
challenges on the power distribution front.
The delivery aspects do not keep the customer
as the focal point, resulting in blackouts, load

In the next one or two years, Tata

Power will focus on acquiring assets
which we can transform and turn into
good opportunities.
shedding, etc. It is unfortunate that 64 years
after independence, we are still struggling with
issues such as these.
Speaking of the mix in the energy
basket, what is the approach
adopted by Tata Power?
We are very conscious of the fact that we need
to create energy security within the portfolio
we manage. We have decided that 20-25 percent
of our portfolio will be based on green assets,
which are non-greenhouse gas generating assets.
We are in hydro, wind and solar sectors,
and are trying to work on geo-thermal. All
this gives us a good mix of power sources, but
because of our India-centricity we are largely
coal dependent; gas unfortunately has gone out
of India, and oil is far too expensive. However,
we have a full portfolio of green assets in Africa
and Turkey.
How does Tata Power and the power
sector manage the increasing
pressure from environmental
activists?
Tata Power has been proactive in terms of
various aspects related to sustainability. But
the nature of our business we use coal,
work on large tracts of land, potentially
impacting flora and fauna attracts the
attention of environmentalists. It is important
to understand that having no power is a bigger
stress on the economy than polluting the
environment using coal.
The government must find land that is
away from habitation, where the impact on the
land and population is minimal. If we are able to
produce power at competitive rates with a lower
impact on the environment, we can use that
power to service the economy. After all, power
ultimately is the cleanest form of energy.

April 2014 

Tata Review

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COVER STORY

The biggest challenge is

cultural diversity
giants Westside, Star Bazaar
and Landmark, all catering
to the micro-level wishes
and demands of the Indian
customer. Tata International,
on the other hand, runs a
global trading and distribution
business, dealing in millions
of tonnes of metals and
minerals, apart from its Africa
distribution operations and the
Indian leather export business.

To say that managing

director Noel Tatas typical
workday is challenging is an
understatement because he
heads two huge and vastly
different concerns Trent and
Tata International. Trent is the
umbrella organisation for retail

April 2014
16 Tata Review 

Asked what its like to straddle

these two completely different
worlds, Mr Tata replies with a
laugh, Its fascinating! In this
interview with Gayatri Kamath,
Mr Tata gives us an insiders
view of his two worlds and
shares his vision for the two
companies.

COVER STORY

Lets start with Trent. The big news is

that Tescos entry into the Indian
market has been finally approved.
What now?
Its been a long journey. Weve had an association
with Tesco since 2008 with an exclusive
franchising and wholesaling agreement. So
weve been working together for a number of
years. Now that multi-brand FDI has been
approved, Tesco will be able to invest in Trent
Hypermarkets.
We have a large pipeline of to-be-launched
stores: The existing 12 Star Bazaar stores will
continue and we intend to open at least five new
stores every year, in Maharashtra and Karnataka.
Star Bazaars association with Tesco
underlines the solid foundations of the business,
and is a signal of the untapped opportunity in the
Indian market. The operations and profitability of
the business continue to improve, and the team is
performing well on our targets.
Meanwhile, we are evaluating other formats
as well. We opened a smaller format called Star
Daily in Pune, a convenience store that is doing
very well. We plan to launch a second such store
shortly. We believe that these mid-sized formats
will reach profitability faster. Its an exciting time
for the business.
How will the opening of the retail
sector to foreign players alter the
retail scenario in India?
The increased competition brought about by FDI
should, over time, bring in many benefits more
investments in backend infrastructure, reduced
wastage, improved supply chain efficiency, etc.
Sourcing from small industries and farmers
should help them get better prices; customers
will benefit from greater choice and value. Over
time, the benefits will reach more people as new
investments increase reach and competition. On
the minus side, this increased interest by foreign
retailers is certainly pushing up real estate costs!

the great job the Westside team has done in

building this chain of stores into a sustainable,
profitable business. Westside today is a great
brand with a large base of loyal customers. I
believe that there is still huge potential to be
tapped and we have only scratched the surface of
this opportunity.
Trents third brand, Landmark, has not
been doing as well as the other two.
How do you propose to tackle this?
Landmark, unfortunately, has been facing
headwinds due to external and internal challenges.
Yet, we believe the format, with some modifications,
has a space in the Indian retail landscape.
We are planning to reduce the focus on books
although books are still a quarter of the turnover
and look at new areas such as technology, gifting
options and sports. The store portfolio will be
aligned more towards lifestyle products to reflect
market realities. We have also appointed a new
leadership to drive this business.
How have the changes in the business
environment over the last 12 months
impacted your business?
In the apparel retailing space, competition has
increased with more international retailers entering
the country and existing players expanding their
presence. Our response has been to focus on
the value we provide to our customers. We are
continuously improving our product range
to international standards while remaining
competitive and offering value to our customers.

In February 2014, Westside reached

the `10 billion milestone. How do you
feel about this achievement?
It is a significant milestone and a reflection of

April 2014 

Tata Review

17

COVER STORY

The food and grocery retailing business

is a tough one. Star Bazaar is focusing on its
famous for fresh proposition in the retailing of
fresh produce while also offering a great range of
private label brands in staples, groceries, cleaning
aids, apparel, etc.
What kind of challenges does the retail
sector face?
The high cost of appropriate retail space is the single
biggest reason for the slow pace of expansion of
the industry. In addition, most of the regulations
covering retail are state legislations requiring a
multitude of permissions.
Still we are looking to open 10 new Westside
and five new Star Bazaar stores during the year. We
are not looking at any new verticals at the moment
but are working on developing an internet presence.
How do you exploit synergies between
the various verticals of Trent?
Trents formats are already benefiting from
working with each other and utilising each
others competencies. For example, the
Westside management team works closely
with the apparel team of Star Bazaar, given its
apparel retailing expertise, and the Landmark
management team engages with Westside and
Star Bazaar for some categories. The Gourmet
West business within Westside also works closely
with Star Bazaar to source its products.
Large-format retail in India works
differently than it does in the West.

Women being trained to cut leather for shoes


April 2014
18 Tata Review 

What changes have you had to make to

ensure that your stores do well?
Its continuous learning and we change our
processes as per the requirements. For example, the
cost structures are different in India and our stores
reflect that reality, be it rental costs or supply chain
expenses, both of which are calibrated accordingly.
Customer expectations are different Indian
consumers prefer assistance and attention when
shopping, and our staff is happy to provide this. The
way we have tackled the issue of shrinkage is also
very different from the West; in fact, we have worldclass processes for shrinkage.
Lets move on to Tata International.
Last year, the company announced a
renewed vision, following a year-long
strategic planning exercise. How has
it translated in terms of business?
Last year, Tata International had laid out its
vision to be globally significant in each of its
chosen businesses by 2025. We decided to focus
our efforts in five verticals leather and leather
products, distribution, metals, minerals and
agri trading. Each vertical has designed its own
strategy to differentiate itself in the market and
to excel at customer service.
I am happy to say that in the last three
years, we have grown by 60-70 percent every
year from just `26 billion in 2010-11 to cross
`100 billion in revenue this year, a big milestone
for the company. The primary focus for the next
three years will be profitability.
We have also restructured to run the
company by business rather than by geography.
Each business operates independently from the
others and the central team provides support to
the businesses in areas of strategy, finance, HR
and logistics. Our target is to touch `150 billion
in the next couple of years.
What is the roadmap you have
charted for 2025?
The emphasis is on value creation. At our
recent leadership offsite, we discussed how
Tata International can create value for its
stakeholders. Each vertical has interpreted this
in its own way.

COVER STORY

For example, delivering coal to a customers

factory instead of the nearest port is a new
initiative for our minerals division. Our auto
distribution team is working on how they can
provide logistics solutions instead of selling only
trucks and buses. Each vertical has developed its
unique approach to improve customer retention
and increase profitability. You cant standardise
value creation.
We also intend to explore other geographies
in Southeast Asia such as Laos and Cambodia
and expand our footprint in Africa.
How does the leather business plan
to move up the value chain?
In our finished leather business, we are focused
on selling to premium footwear brands. This
year we start supplying leather to the automotive
industry through our marketing and technical
joint venture with GST Autoleather which
is a global leader. The joint venture will be
operational in the next few months. We will use
Indian raw material and low cost operations to
supply premium leather to leading automotive
companies.
In the leather products area, we are
consolidating our position as a leading vendor
in the elegant shoe segment while embarking
on a strong sales drive into the US market. (We
currently predominantly serve the European
shoe market.) We are also building our ladies
shoe business through the Aerosoles brand.
What is the vision for the African
market?
Tata International has been operating in Africa
for over 40 years. We have not only increased
our business there but also created a platform
for other Tata companies to enter Africa. We
continue to be the face of the Tata group on
the continent and are working to increase the
strength of the Tata brand in Africa.
Our distribution vertical has a presence
across 14 countries and we intend to spread this
footprint. We have shown sustained growth in
revenue and profits, and have added several new
brands to our portfolio.
In auto distribution, for instance, our

portfolio has grown to include John Deere, Tata

Hitachi, Jaguar Land Rover, etc. We are slowly
building our presence in other segments, such as
chemicals, healthcare and agricultural products.
Across all our segments, we are focusing on
becoming a world-class distribution business. We
intend to engage deeper with existing customers
to increase our share of wallet with them.
What are the challenges of being an
international trading and distribution
company in todays times?
Most of our competitors have a huge head start
over us and the biggest trading companies have
revenues in excess of $200 billion, with well
established relationships both on the customer
and the sourcing side. So we have to go the extra
mile to win business. Trading is also hugely
people-dependent, and attracting the best talent
remains our first priority.
What investments have you made in
your people, infrastructure and
systems? What are the human
resources challenges you face?
Because of the change in strategy of the
company, we have over the last three years
brought in several new leaders in each of our
verticals, each with domain expertise and global
experience. We are now working with Tata
Consultancy Services on revamping our global
software platforms, and last year migrated to
new offices in Mumbai.
The biggest challenge is the cultural
diversity which is beginning to emerge across
the organisation. We recognise that our
managers need to appreciate the different styles
of management that come in a multi-cultural
organisation and adjust to this.
What do you see as Tata
Internationals unique strengths?
We are operating in the right geographies, ones
that are exhibiting the highest growth rates at the
moment. In addition, being an Indian company,
we are uniquely placed to serve the Indian and
African markets and have found it easy to earn
the trust of our counterparties.

April 2014 

Tata Review

19

COVER STORY

In 5-7 years, our business

picture will be very different

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April 2014
20 Tata Review 

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years ahead.
Tata Chemicals is fairly diversified in
its businesses. Where does the
company stand as compared to its
peers?

COVER STORY

Tata Chemicals is a leader in most of its chosen

areas of business: its the worlds second largest
soda ash company; it covers over 100 million
households in the consumer products category;
it leads the branded salt market with a market
share over 60 percent and is one of the category
leaders in the business of pulses and water
purifiers.
Tata Chemicals (including Rallis and
Metahelix) continues its deep engagement with
the Indian farming community, unmatched and
unparalleled by any other Indian competitor. We
service over 10 million farmers, covering about
85 percent of Indias arable land. We have about
800-odd of our own stores selling farm inputs
and we expect this figure to touch 1,200 stores
by the end of the year.
Nutraceuticals, the new business line
developed by our innovation centre, will soon go
into commercial production.
So heading into its 75th year of operations,
the company is looking at positioning itself less
as a chemicals company and more as a holistic
provider of products and services that are based
on science.
What is the strategic direction that
the company plans to take in the
long-term?
The chemicals business is now a mature
business. Going forward, we have identified the
food and nourishment platform and the farm
input platform as two key pillars for growth.
These will primarily be based in India, but
there is an export potential for the farm input
business, especially in Africa, South East Asia
and Latin America. And for this we are working
closely with Tata International. Our innovation
centres will develop speciality products focused
on these two platforms.
Its been a tough year for the
company. What are the main factors
affecting the soda ash business?
Its the UK and Kenya businesses that are facing
tough times; the Indian and US businesses are
doing fine due to their competitive cost position.
The soda ash market demand is growing steadily

at 3-4 percent. The major issues are with our

cost structures in the UK and Kenya, where we
are struggling with high energy costs which are
making these businesses structurally weak.
How has the company handled these
issues?
We restructured the UK business by closing
the Winnington soda ash facility. Close to
`9 billion has been written off (including the
impact of Netherlands and UK closures), and
the aftermath of the restructuring may continue
for a couple of quarters. The Kenya business
is examining its reconfiguration options this
financial year.
We will need to manage key costs, such
as energy and fuel, and make our processes
much more efficient and effective. We have
a programme of lean Six Sigma that is being
executed in all our plants. The positive impact of
these steps will be felt in our businesses soon.
What is the way ahead for the soda
ash business?
We are happy with our market position and
the customer relationships we have established.
We are addressing the cost competitiveness
issue in the UK and Kenya. Although theres no
immediate plan for capital investment in soda
ash, we are investing in enlarging the product
portfolio to include higher value-added products
such as sodium bicarbonate products for use
in the pharma, animal nutrition and flue gas
treatment industries.
Coming to the agri business, how
has the market responded to TCLs
high-value fertilisers? What are the
prospects in this business?
The agri segment has been one of the best
performers in the Indian economy. The company
continues to benefit from the shift of the
Indian farmer towards higher technology and
higher productivity, which implies greater use
of high quality seeds, crop nutrition and crop
protection chemicals. We intend to intensify
our investments in this business by investing `5
billion over the next two years.

April 2014 

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21

COVER STORY

The company is looking at positioning

itself less as a chemicals company and
more as a holistic provider of products and
services that are based on science.
We would, however, consciously stay away
from products where government subsidies are
involved, and, keeping this in mind, we have
decided to not invest in the commodity segment
of the agri business. The company also pulled
out from the Gabon fertiliser project, which
was in line with this thinking. We will increase
our investments in high-tech products such
as specialty fertilisers, herbicides, weedicides
and high grade seeds. We see the agri business
growing from it s current size of `80 billion to
about `150 billion in the next few years.
TCLs line of food and nourishment
products is growing rapidly with
I-Shakti dals, besan etc. What is the
vision for this business? What are
the new products planned?
The vision is to deliver nutritious products
that are branded and packaged for quality and
convenience. We are well positioned to roll out
these products through our existing Tata Salt
distribution network that touches 120 million
households. The consumer business has tripled
in the last three years and has crossed the `11
billion mark. Our expectations are that it will
more than triple in the next five years. We
currently have a mix of basic foods (like dals)
and complementary value-added products
(such as besan, a flour made from a dal). We are
looking at options to expand the portfolio in
basic and ready-to-cook segments.
What is new in the Tata Swach
business? Are you looking at markets
outside India?
In the water purifiers business, the market
reception has been excellent and we have sold
over 1.1 million units. We now have a complete
range of products, starting from the high-end
reverse osmosis (RO) purifiers at `17,000, to the

April 2014
22 Tata Review 

basic filter purifiers around `1,000. We are, in

fact, the only brand in the sub-`1,000 category
catering to the low-income segment. In the
past three years, we have purified close to 7,500
million litres of drinking water. There is export
potential in this business, but India will continue
to be our main market.
What will be the impact of the
changing demographics of India on
Tata Chemicals in terms of the
marketplace, talent pool, customer
base, etc?
We believe that there are two broad trends
where we need to focus as India moves to a $3
trillion economy with a large youth population.
The first trend is rapid urbanisation, which will
drive consumers towards packaged and branded
products from loose products. This represents an
area of tremendous market opportunity for us
in food and nourishment. Urbanisation will also
create a pressure in rural India to move away
from labour-intensive practices to practices
involving greater mechanisation and technology.
This means that companies like ours that supply
products for higher productivity will stand to
benefit substantially.
The second trend will be generating
employment for the youth of the country.
We believe that we need to play a key role in
that space too, especially in skilling future
agriculturists.
The climate change bogey raises its
head with increasing frequency.
Given that Unilever is a big client,
has the Unilever policy on supply
chain sustainability impacted Tata
Chemicals in any way?
We work with several entities like the UN Global
Compact, Carbon Disclosure Project, Global
Reporting Initiative, etc. We have a strong
sustainability commitment which is in line with
the Tata group policy on sustainability. Hence,
for us, partnering with customers like Unilever
and Procter & Gamble has been a pleasant task.
At Tata Chemicals, sustainability is reviewed at
the highest level in the board. The actions are

COVER STORY

cascaded down the line and our internal systems

are well embedded. The Unilever partnership
just reaffirmed that we were on the right track.
The Tata way of working implies a
strong focus on aspects such as
innovation, sustainability, customercentricity, employee engagement,
etc. How does the company embed
these concepts in its operations?
These are integral to our business. Take
customer-centricity. We have a diverse range of
customers, from multinationals like Unilever
to housewives and farmers. And we are
committed to delivering whats best for them.
In our farm input business, we have walked
away from selling unsafe red-triangle products
well ahead of regulations and laws. This is
based on our customer insight as well as our
sustainability policy.
The market for Briskarb for flue gas
treatment grew out of the tightening of
emission control norms. Our Swach water
purifier does not use electricity. These are
all green products. Our innovation and
sustainability focus is our strength. We have
four R&D and innovation centres that create
products for the farm and consumer products
businesses.
How does your company use new
technologies or new media in its
operations?
We see IT as the enabler to improving and
simplifying our customer delivery and employee
processes. The company has invested in
e-enabling our work processes and we are in
the process of digitising them in a smartphonefriendly way. We have created a Centre for
Process Excellence and Consolidation (CPEC).
Over a period of time, this centre will manage all
the back-end processes of the company. We have
started with the finance and accounts function
and soon other support functions will migrate
there. CPEC is completely outsourced and Tata
Consultancy Services is managing this for us. Its
not about cost but about increasing efficiencies
and effectiveness.

When it comes to social media and

digitisation, we are at an early stage. We have
formed a small core team to see how we can
adapt our marketing and employee engagement
processes to social media. As a start, our new
Tata Salt campaign, with Mary Kom as the
brand ambassador, is being promoted on social
media.
How difficult is it to maintain softer
values like sustainability, ethics,
responsible citizenry and integrity in
the world of hard numbers?
Companies have to deliver hard numbers, but
this cannot be at the cost of values. We believe
that if you have high levels of integrity and
corporate responsibility, the delivery of hard
numbers becomes easier. We have found that
employees and consumers are motivated, and
the community is highly supportive. A lot of our
brand equity rests on these pillars.
Going into its 75th anniversary, what
lies ahead for Tata Chemicals?
As we embark on the new financial year,
hopefully the impact of the restructuring of
the UK business should be behind us and the
reconfiguration exercise for the Magadi business
will be under way. We will be able to renew
and recharge the company and bring it back to
healthy performance.
The chemicals business is now a
mature business; the farm business is in the
early adolesence stage; and the food and
nourishment business is in its infancy. There
is an increased realisation that we are an
enterprise with three distinct businesses and
business models and each one will need its own
space to grow. The farm business and the food
and nourishment business are the two segments
that will need to be nurtured for the future
growth for the company.
In five-seven years, the Tata Chemicals
business landscape will be very different,
with all our businesses probably of similar
impact and size. We will be less of a chemicals
company, and more of a business thats serving
society through science.

April 2014 

Tata Review

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COVER STORY

Technology is a key pillar

for our growth
magical beverage moments
for consumers across the
world through its brands. In
this interview Ajoy Misra,
CEO and MD, Tata Global
Beverages, talks to Sujata
Agrawal about the high points
of the company in 2013-14 and
its focus on building brands
the sustainable way. Excerpts:

Tata Global Beverages is on

a mission to lead the world in
good for you beverages. It is
the worlds second-largest tea
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interests in coffee and water.
The company aims to create

April 2014
24 Tata Review 

What were the high points and

challenges of 2013-14 for Tata
Global Beverages (TGB)?
It has been an exciting year for Tata Global
Beverages. We have seen innovative product
launches and impactful marketing campaigns
globally. In the United Kingdom, we celebrated
40 years of the iconic Tetley Tea Folk with an
innovative 360-degree marketing campaign,
Find Sydney.
In India, Tata Tea, the companys flagship
brand, partnered with the Tata group to launch
The Power of 49 campaign to urge women to
exercise their power of vote, in the run-up to the
general elections. The re-launch of Tetley Green
Tea with Bollywood actress Kareena Kapoor as

COVER STORY

brand ambassador earned high traction with

consumers. Tata Gluco Plus added new flavours,
which met with good market response. Tata
Starbucks, with 44 stores across Mumbai, Delhi,
Pune and Bengaluru, continues to elicit excellent
consumer response.
In the United States, given the challenging
coffee market, we re-launched the 150-year-old
heritage brand Eight OClock coffee in a sleek new
red pack design, with exciting new blends.
We consolidated our Australia turnaround
and clocked good progress with new and
exciting product launches. Our Canada business
retains leadership position in tea. The Russian
market, though competitive, has incredible
potential and we are mapping it to sharpen our
marketing efforts.
Internally, we re-articulated our vision and
purpose. We are committed to creating magical
beverage moments through our tea, coffee and
water brands for our consumers across the world.
The business environment has been
challenging with rising input costs, high
competitive intensity and challenging market
conditions in many of our markets. However, we
believe our investment in building strong brands
and focus on process improvements and efficiency
have helped us weather these challenges well.
What are the plans for this year in
terms of new businesses and brands?
Consumers are pursuing a healthy lifestyle
and opting for beverages such as green tea and
fruit or herb-based drinks. To meet this need,
Tetley offers interesting flavours in the green tea
portfolio. Tetley 100 percent steamed green teas,
launched in Canada, are a range that is gently
steamed immediately after picking to lock in its
fresh flavour. In the United States, we launched
Tetley Black & Green tea, which offers the flavour
of black tea and the goodness of green tea in a
single cup. In India we are promoting Tetley green
tea. Our aim is to be the global leader in this area
in terms of market and thought leadership.
We have an innovative product in Australia,
Tetley Chai Latte that has real spices such as
cinnamon, cloves, cardamom and ginger; it is
also low in caffeine and is 99 percent fat-free. We

The Power of 49 campaign on the Tata Tea Gold pack

intend to build on this effort. Another area that
has exploded in the last 12 months is the pods
category and we are following this closely.
In other businesses, we plan to scale
and develop the market presence of our joint
ventures, Tata Starbucks and NourishCo.
What are the challenges and the
opportunities in the next two years?
While there is the challenge of declining growth
in the black tea category in some markets, it also
presents an opportunity for TGB to romanticise
the tea category and create magical beverage
moments for consumers.
Private label play has seen huge growth
across categories around the world. As the
retail environment changes and becomes
more modernised, brands will either need to
be market leaders or offer a very niche and
differentiated value proposition. We also need to
look at M&A opportunities to gain scale in key
geographies. Another challenge and opportunity
for us is growing our water portfolio.
Tata Water Plus, Indias first nutrient water,
launched in February 2012, represents the larger
mission of mitigating nutritional gaps in Indian
diets. It is available in two states and our plan is
to make it a national brand.
Tell us about The Power of 49
campaign and its impact.
Tata Tea has been running the Jaago Re
campaign since 2007 to inspire social awakening

April 2014 

Tata Review

25

COVER STORY

in India, encouraging people to take small steps

for change. One of the strengths of the campaign
was to take up issues before their time, for
maximum impact. This year we focused on raising
awareness about women-related issues. The first
campaign Choti si Shuruwat (a small beginning)
sparked more initiatives. Our annual report
was a tribute to women who have contributed
significantly to our business.
The Power of 49 campaign is our effort
to awaken Indian women to the power of
their vote (women constitute 49 percent of
the electorate), with the expectation that an
informed and participative female electorate will
evoke a positive response to womens issues and
influence national development. The impact has
been tremendous; 1.4 million women registered
and discussed their issues on various platforms.
The data was mined to create a comprehensive
The Power of 49 manifesto, which was presented
to political parties in April 2014.
The campaign took an exponential leap when
the Tata group decided to adopt it as a group-wide
initiative. Over 40 Tata companies and subsidiaries
joined the effort.
Sustainability is key for businesses.
How is it translating at TGB?
Sustainability is at the heart of our plans for
long-term success. The company has already
made impressive progress.
TGB is an active member of the Ethical
Tea Partnership (ETP). The ETP is working
with Rainforest Alliance (RA) to help tea estates
achieve RA certification and improve social and
environmental sustainability. Tetley now sources
20 million kilograms of tea (50 percent of its total
tea purchased) from RA-certified farms each year.
We train our tea-buying teams around the world
on sustainability to help embed best practices. The
India Sustainable Tea Programme TrustTea,
launched by the Tea Board of India is an
initiative to sustainably transform the Indian tea
industry. TGB will participate in the development
and implementation of the programme, and
provide financial and technical support.
TGB was rated as No1 in the consumer
staples sector in India on the Climate Disclosure

April 2014
26 Tata Review 

Leadership Index for 2013. Today, we monitor our

carbon footprint in over 70 different sites in Asia,
Africa, Europe, North America and Australia.
We partnered with Water Footprint Network
Netherlands and Tata Sustainability Group for the
Water Footprint Assessment (WFA) of TGB to
understand how to sustainably and equitably use
fresh water in our operations.
What are the new technologies that
your company is using to boost
productivity, improve
communication, manage costs, etc?
Technology is a key pillar for our growth.
Our employees are located globally across
different time zones, and technology is critical
for collaboration.Our intranet, Source, allows
teams to keep in touch with whats going on in
the business.
We leverage technology extensively
across functions to build business efficiency.
Use of SAP systems has allowed easier global
integration and provided access to accurate and
timely information for decision-making.The
CA Clarity tool for project and portfolio
management allows us to efficiently track
business benefits delivered by projects.
Garuda, our global system for product
development and validation, serves as a
repository of information on vendors, raw
materials and finished products, and enables
structured workflow between departments. The
new product development teams are able to use
the tool to experiment with different ingredients
during the development phase of a new product
to tailor a formulation to meet specific cost, taste
or nutrition targets.
Advanced Planning Scheduler is an optimiser
solutionused by our tea buying and blending
function. It takes into account various factors to
work out the most optimum recipes, which are fed
into SAP systems to enable buying and blending
for the recipes. The Supplier Offer Site was piloted
as an alternative buying channel in TGB. It used
technology to conduct the first reverse auction in
the history of the tea industry. The pilot, last year,
was a success and we intend to roll this out on a
larger scale this year.

COVER STORY

We have come out stronger

minerals, railways, water, oil
and gas, and quality services.
Vinayak Deshpande,
managing director, Tata
Projects, talks to Jai Wadia
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2013-14 and discusses its
future plans in an interview.
Excerpts:

Tata Projects, one of the

fastest growing infrastructure
companies in India, has
expertise in executing large
and complex industrial
infrastructure projects.
The company has seven
business verticals power,
transmission, metals and

How would you rate fiscal 2013-14?

What were the main highlights for
Tata Projects?
It was a difficult year in terms of external factors
and business opportunities, but we used it to
introspect, build, strengthen competencies and
explore new growth areas. Despite a tough year,
we have come out stronger.
In terms of execution, the year has been
remarkable. We completed Indias largest blast
furnace for the Rourkela Steel Plant of the
Steel Authority of India. We commissioned the
balance of plant of unit No1 of Andhra Pradesh
Power Generation Companys 2x800MW super
critical thermal power plant at Krishnapatnam.
We also commenced work for the Dedicated
Freight Corridor Corporation (DFCC) and for a
Tata Steel project at Khondbond mines. Though
we have seen marginal revenue growth, the
bottom line is higher than the previous fiscal.

April 2014 

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27

COVER STORY

Can you tell us about your ongoing

projects?
Over the next 12 months we have some major
responsibilities.
We have to construct and hand over 20
percent of the national grid projects awarded
to us by the Power Grid Corporation of India.
Our first engineering, procurement and
construction (EPC) contract for the
1x388MW, gas-based, combined cycle power
plant project for Pioneer Gas is nearing
completion.
The 350-km-long twin track project for the
DFCC is in progress. We need to ensure
completion of embankment in the next few
months and we should start laying the tracks
so that we deliver this prestigious project on
time to Indian Railways.
The Khondbond mines ore crushing and
beneficiation project, with a capacity of eight
million tonnes per annum, is an important
one as it will feed the new expansion of Tata
Steel.
We are involved in the construction of
civil, mechanical and piping works for the
Kalinganagar project of Tata Steel in Odisha.
The work is challenging, with an extremely
tight schedule.
The National Mineral Development
Corporation (NMDC) has awarded another
blast furnace project to us for its 3.0 MTPA
integrated plant at Nagarnar in Chhattisgarh.
We need to ensure that this project is
mechanically completed during the year.
Internally we need to ensure that we build
strong execution muscle. We need to be far more
focused on field productivity, people skills and
systems efficiency. Always on time has been
our motto and so far our general track record is
without any liquidated damages delays. Now we
want to advance into the area of ahead of time, by
being proactive, rather than just being compliant.
Huge investments are expected in
building new roads, airports and
housing projects in India. What
opportunities and challenges do you
see for Tata Projects here?

April 2014
28 Tata Review 

Tata group companies including Tata Steel, Tata

Realty and Tata Housing are implementing
many projects in the infrastructure sector and
they have awarded substantial work to us. Tata
Steel has awarded work in the Kalinganagar
project as well in the Khondbond mines. Tata
Realty has given us the opportunity to work for
its project, Tata Center at Gurgaon.
We need to ensure that we provide valuebased services at market competitive prices to
our group companies so that there is win-win
synergy. Under the guidance of senior leaders, we
have formed a group within all Tata EPC / project
companies wherein we meet periodically and
review our best practices and areas where we can
improve our performance.
How will the current economic
uncertainties impact your business
in the short-term?
The external economic scenario continues to
be challenging for Indian industry. Both the
global and Indian economic situation have
undergone turbulent times in the last four years.
The external economic scenario continues to
be challenging for Indian industry. There is an
almost complete collapse of the public-private
partnership (PPP) framework in India. Most
construction companies are debt-ridden, with
practically no revenue growth, and banks are
unable to support them as they are saddled with
non-performing loans and assets.
The impact has been substantial. In our
core business of power generation, we could not
see any movement during the last two years.
To counter this, we picked up orders in other
verticals. However, investment confidence, speed
of project execution and payment cycles still
remain stretched in all types of projects.
What is your long-term prognosis for
the business?
There are two aspects to this. One is internal
focus and the other is market or external. As
we compete in a fierce marketplace, one needs
to tighten belts and build strong processes,
systems and skills to compete. At the same time,
as external forces, such as the slowdown, affect

COVER STORY

the business, one has to look for de-risking by

expanding into adjacent spaces and expanding
to newer geographic markets.
We must continuously differentiate and go
up the value chain by adopting new technologies,
and we must de-risk the business by adding
multiple verticals and new growth dimensions.
Our seven verticals will become part of a
larger strategic business unit called EPC and
construction projects, which will continue to
remain our mainstay with a potential to grow
to `100-billion-plus revenues. We will have
to venture into urban infrastructure; and to
reinforce bottom line results we will need to
expand the services business.
What are your plans to leverage
opportunities in the water sector?
We believe that water is the next big business.
We have two offerings in this space water
EPC projects and reverse osmosis (RO) units.
There are unfolding opportunities in the
industrial water and waste management area.
Regulation is becoming more stringent and
availability of industrial water is becoming scarce.
This provides substantial opportunity in the
industrial water and waste management area. We
have advanced offerings in the RO segment and
many products are in the market.
What will be your key focus markets
outside India?
In our quality services business we have inspection
offices in almost 32 countries. Our value
proposition is to provide third party inspection
services for capital goods to and from India.
Recently we have also taken our EPC
projects and construction business internationally.
Last year we entered eastern Africa and some
parts of the Middle East.
Could you tell us about the Rourkela
Steel Plant blast furnace that you
executed?
It is the largest blast furnace currently
operational in India with furnace volume of
4,060 m3 and production capacity of 8,000
tonnes of steel per day. It is based on a design by

We must continuously differentiate and

go up the value chain by adopting new
technologies and we must de-risk the
business by adding multiple verticals...
Danieli Corus (a joint venture between Tata Steel
Europe and Italian equipment manufacturer
Danieli), our consortium partner in the project.
Tata Projects has set an impressive safety
record of over 21 million safe working hours,
in the project and the blast furnace has been
running smoothly for the last several months.
The current production levels are about 6,000
tonnes steel per day. The cost structure is at the
industry-best level and we believe this furnace
will change the cost economics of the Rourkela
steel plant.
How difficult is it to maintain softer
values like sustainability, ethics,
responsible citizenry and integrity
given profit pressures and
particularly in the current political
and bureaucratic environment?
We are here to create a business that can last
many years and therefore has to be designed on
the foundation of values such as sustainability,
ethics, responsible citizenry and integrity. I have
no example of any business which is designed
on different parameters and has managed to
last beyond a few years. So we are clear that as
an organisation, if we inherit these values and
integrate them into our business design we will
create a performing and lasting business.
Is it possible to manage work-life
balance?
I love what I am doing. Therefore, this work is
life and life is this work for me. It does not bore
me, it does not give me any stress. I am at a
perfect mind body balance. An organisation
must provide opportunities to achieve work-life
balance. At the company level, we must do
outdoor meetings and family gatherings and we
ensure that every employee is able to live a
stress-free life.

April 2014 

Tata Review

29

COVER STORY

We continue to grow in a
difficult market
meeting at Bombay House,
he talks to Sangeeta Menon
on regulations, the challenges
his company faced in the
last year, growth prospects
for next year, and his focus
on making Tata Steel more
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as managing director of Tata
Steel (India and South East
Asia), TV Narendran has set
the ball rolling as far as future
growth for the company is
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April 2014
30 Tata Review 

For the financial year 2103-14, what

would you pick as the highlights for
Tata Steel India in terms of both
achievements and challenges?
The economic downturn has slowed down
businesses in India, particularly in the case of
auto and construction industries. But Tata Steel
India has, in a difficult market, managed to add a
million tonnes to its capacity in 2013-14, growing
by 12-13 percent. We not only gained in terms of
market share, but we also increased our volumes,
protected our margins (compared to last year),
and entered new segments.
Given the tough market conditions,
where did the growth come from?
The growth has come from both existing and new
products. We have grown our share in the auto

COVER STORY

industry from last years 39-40 percent to 43 percent

this year. We reached out to almost 6,000 SME
customers, a segment that has traditionally been
under-served by steel companies. We have built a
network of over 40 distributors to ensure that SMEs
get the steel they want. The effort has paid rich
dividends as we have sold a significant amount to
the SMEs, which contributed to the growth.
In terms of customer-centricity, we
have probably done more work in the market
than most steel companies in the world. Few
companies have achieved the level of innovative
work we have done, the new routes we have
developed and the engagement we have with our
customers. The weaker rupee helped as imports
shrank and we were able to step into that space.
Over the last year, India has turned from being a
net importer to a net exporter of steel, but given
the lucrative domestic market, we decided not to
focus on exports.

projects in recent times. What does it

mean for Tata Steel?
We are looking at commissioning the project in
the last quarter of 2015. The first phase of the
project will create capacity of 3 million tonnes at
an investment of over `250 billion. Its a massive
financial commitment and we need to start
production soon.
Kalinganagar has been a huge learning
for us. The last time Tata Steel did a greenfield
steel project in India was in Jamshedpur when
the (Tata group) Founder and his sons did it. So
when we went to a new place, in some ways we
underestimated the challenges. We assumed that
since we had a lot of equity and we went with the
right intentions, everyone would welcome us.
However, people have their own anxieties and we
cannot take them for granted. So engaging with
the community, listening to them, building trust
is something that must be done well ahead of the
project; it cannot happen alongside.

Tell us how the business has grown in

South East Asia in the last one year.
Tata Steel Thailand, which is largely focused
on the domestic market, has struggled over
the past four years due to operational, internal
and investments related issues, but this year we
expect it to turn around.
NatSteel, which is based in Singapore, has
joint ventures and downstream units in China,
Vietnam and Australia. It is probably our only
overseas business that has never made a loss. The
business is self-sufficient and does not need cash
infusion for growth. The Australian business,
where we were losing money after the 2008 crisis,
is being restructured. We exited the Philippines
business and are setting up downstream centres
in Indonesia and Malaysia.
For the business in China, which has grown
significantly, we use the existing assets and
leverage the equity we have in the market to sell
almost 150,000 tonnes a month and 2 million
tonnes a year. China is a thin-margin and qualityconscious market, so we have to operate a nimble
business that offers good quality.

Is the continued uncertainty in the

regulatory environment a cause for
concern? How does this affect
business and morale?
CEOs in India spend far more time addressing
regulatory issues than CEOs in other countries
do. To be fair to the regulators, the industry has
invited this scrutiny to an extent. There is a need
for the industry to look at responsible growth and
be good corporate citizens.
In the next ten years, the demand for steel
in India is expected to grow to about 180-200
million tonnes. So capacity of an additional
100 million tonnes has to be built, for which we
need to spend approximately $100 billion. Very
few countries in the world have both the raw
material and the market. India has both. But if
we dont leverage this opportunity to translate
the richness below the ground to opportunities
above the ground, then we will be missing
out. To support this, Indias regulations need to
be simple enough to attract investors and tight
enough to ensure communities are not exploited.

The Kalinganagar project in Odisha,

India, has been one of your biggest

What are the factors that create

optimism for the company despite the


April 2014 

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31

COVER STORY

material, land acquisition, raising funds, and

many other factors. The depreciation of the rupee
is helping us become more competitive.

Molten iron being poured at the Jamshedpur plant. The Tata

Steel Group has an annual capacity of over 29 million tonnes
regulatory environment and the
economic slowdown?
My optimism stems from the fact that Tata
Steel has a strong team and a good track record.
Besides, the last quarter has been better than the
one that preceded it: the construction industry
has seen more projects, the auto industry has
seen a pick-up. Hopefully, post elections there
will be some stability in the market. Overall,
I am optimistic because the right things such
as good governance, job creation, growth and
corruption, etc, are at the centre of the political
debate.
How do you see the steel industry
performing in the year ahead?
Steel is very closely linked to the GDP. You can
assume that the steel consumption growth will
be 1.2 or 1.3 times the GDP. I see the GDP in
the 4.5 - 6 percent range for at least two years,
which means that steel consumption will be at
5-7 percent. In the medium to long-term we
need to add capacity to keep up with demand.
Profitability will depend a lot on the cost of raw

April 2014
32 Tata Review 

What can we expect of Tata Steel in

India and South East Asia in the next
12 months?
We would like to add a capacity of a million
tonnes every year in India. The capacity at
Jamshedpur will touch 10 million tonnes and the
Kalinganagar plant will go live in the last quarter
of the year, adding more capacity.
In South East Asia, we will continue to go
downstream, setting up facilities in Indonesia,
Malaysia and Hong Kong. We are currently
at 4 million tonnes of sales in this region and
I would like to take that to five to six million
tonnes. As countries such as Vietnam, the
Philippines and Myanmar are still at an early
stage of steel consumption, we have huge
opportunities to tap. The key is in going about it
in an integrated fashion.
If you were to pick your key
priorities in the year ahead, what
would they be?
My top priority is to get the Kalinganagar project
off the ground. We have spent huge amounts of
money there, so we hope that we can translate
the investments into revenue and profits much
faster. The second area is dealing with all the
regulatory issues that come our way.
The third area is doing well in challenging
situations by not losing sight of customers and
markets. People will be a priority too. We are
going through a transition, including leadership
changes; since a lot of people at the operating
level will retire in three years, we are moving
people laterally and integrating them into the
Tata Steel culture to create an organisation that
is confident, creative, collaborative, comfortable
with itself.
As we scale up, the centre of gravity will
shift from Jamshedpur. How then do we create
high levels of employee engagement? We want to
create an environment where people can excel.
If we do that, the organisation will have enough
depth and strength to deal with challenges.

COVER STORY

Innovation is a pre-requisite
for any successful company
in Singapore and has nine
global delivery centres:
Detroit (USA), Coventry (UK),
Pune and Bengaluru (India),
Stuttgart (Germany), Bangkok
(Thailand) and Brasov, Craiova
and Lasi (Romania).

Tata Technologies is a global

provider of engineering
services outsourcing, product
development, IT services and
product lifecycle management
solutions. Established in 1989,
the company is headquartered

In this interview with Nithin

Rao, Warren Harris, president
and global chief operating
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talks about the companys
growth in 2013-14, challenges
and opportunities in the
Indian market, importance of
innovation, sustainability and
much more. Excerpts:
How has the company performed in
fiscal 2014?
We have had a very solid year. In US dollar
terms, we expect to grow in the high single
digits and in Indian rupee terms by over

April 2014 

Tata Review

33

COVER STORY

15 percent, which is at par with the market

growth, but a little bit less than what we had
planned.
In April 2013, as part of our diversification
strategy, we acquired Cambric, a USheadquartered global engineering services
company with a significant footprint in Eastern
Europe. Cambric has a very strong industrial
machinery vertical, but this sector was
somewhat challenged last year by the downturn
in the commodity sector and the impact that
it had on mining. The good news is that we are
now beginning to see the synergies from the
acquisition, and over the past six months we
have seen an improvement in the performance
of Cambric and the industrial machinery
vertical across the globe.
What is your perspective on the
growth potential for fiscal 2015?
At the beginning of last year we acknowledged
that what brought us to the point of being a
$400-million dollar company is not going to
take us to the $1-billion-mark. So we decided
to implement a programme of transformation
in our sales and business development areas.
We implemented a seven-point change
plan, making sure we target the right accounts.
We went through a sophisticated selection
process to identify the right accounts that
represent the right potential for us.
We are bullish about the next fiscal and
are expecting to grow faster than the estimated
growth rates for our markets.
We have seen sustained improvement
in North America over the past six to nine
months. Europe too is showing strong growth.
As for India, we are expecting significant
improvement post the general elections. India
is not just a market that supports the supply
side of our business; we see it increasingly
become a manufacturing hub for the rest of the
world. So we are bullish about our prospects
here.
What are the new challenges and
opportunities for the company in the
next two to three years?

April 2014
34 Tata Review 

In the automotive sector, emission standards

are encouraging investments in smaller engines
to drive efficiencies and reduce emissions.
Furthermore, there is going to be an increase
in innovation in the embedded space, which is
where significant innovation is being realised.
The electric car and the driverless vehicle
will become meaningful propositions in about
three to five years. We believe that the work
we have done in the electric vehicle space has
given us strong capabilities in the packaging of
alternative propulsion systems.
In aerospace, there will be higher demand
from India where military spending in percentage
terms is going to be much greater than in most
of the developed world. In industrial machinery,
emission standards are driving greater efficiencies
of existing engines, and various types of projects
will define the space for several years. Many of
the clients we are working with in North America
and Europe are looking at value-engineering, or
the application of frugal engineering principles to
existing products in order to achieve a price-point
that is palatable to India.
On the information technology side of
our business, we have developed services in
areas such as product lifecycle management and
enterprise resource planning (ERP). The ERP
scan supports applications such as SAP and
Oracle suites. We deploy these diagnostic tools
in an organisation to reassess whether they are
extracting value from the investments they have
made. We then make recommendations for
technology and process changes.
What are the steps being taken by the
company to ensure that it retains its
leadership position across its areas of
operations?
There are two frameworks that we leverage in
order to assess our position as an organisation.
One is the Tata Business Excellence Model
(TBEM) framework. We have used the annual
assessment to target the right type of investments
to improve our competitive positions. The
progress we have made in terms of our scores
has underpinned our improved business
performance.

COVER STORY

The other framework, which we leveraged

last year and for the first time, is the Dow Jones
Sustainability Index. This provides an opportunity
for us to look at our business, not just in terms of
competitive position, but in terms of sustaining
the business in the medium to long term period.
How are you managing the cultural
challenges in the company?
We have made it imperative for our senior team
members to meet every month. We meet for
two days every month somewhere in the world.
Our chairman once said that the half-life of any
relationship is about six weeks. If we do not get
together on a regular basis, then the cultural
differences and communication gaps get in the
way of the team being aligned.
One of the advantages that we have as a
company is our diversity; we have executives
in North America, the UK, Singapore and
India. This diversity is a huge advantage for
us, but if it is not managed properly it can be a
disadvantage. We have to ensure that the team is
aligned given our rapidly changing competitive
environment.
Is it difficult to maintain values such
as sustainability, ethics and integrity
for a company with a workforce that
spans different continents?
I dont think it is difficult. Those values are
something that we are very proud of. When we
acquired Cambric last year, one of the things
that we spent a lot of time on was due diligence.
We wanted to make sure the value system of
the people we were bringing in was consistently
aligned with the values of the Tatas.
It is important to accommodate different
styles, to enable the various teams that we got
around in different geographies to do things
differently, but the underpinning values, the
commitments to sustainability, doing the right
things, integrity, all these are a pre-requisite
to being part of Tata Technologies. This is
something we practice and are very clear about.
What is the impact of changing
demographics in countries such as

The Tata Technologies office in Pune

India on your marketplace, customer
base and talent pool?
About four years ago, the average age of our
employees in India was 37; today it is 29.
We have significantly reduced the average
age of employees by recruiting directly from
universities. Young employees have different
mindsets compared to the baby boomers and
the generation X; generation Y kids are selfconfident.
We have been very deliberate about making
sure that we deploy engagement policies that
are targeted at the younger people. One of the
advantages we have is that the value system
of the group resonates well with that of the
younger demographic. The fact that we are not
just a shareholder-driven group, and that there
is a greater purpose to the Tatas resonates with
younger people across the world.
How does a modern executive
manage work-life balance in todays
highly competitive environment?
Im constantly striving toward this balance and
often times come up short. It is very difficult these
days to not be connected. One has to accept that
when you run a company you are accessible seven
days a week, 24 hours a day. The way to
increasingly achieve balance is to make sure you
assemble the best teams. Today business is very
competitive and there is always somebody there
who wants what you have got; unless you are
committed and engaged, more often than not it is
difficult to successfully grow a company.

April 2014 

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35

COVER STORY

This year helped us introspect

and become stronger
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April 2014
36 Tata Review 

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COVER STORY

What was the thought process

behind the name change from
Titan Industries to Titan Company?
The name change was carried out to reflect
the companys transformation from being a
manufacturing and marketing company to an
entity which is more in the lifestyle space. It does
not change things within the company in terms
of operations. We will continue to design great
products, achieve manufacturing excellence and
create great brands. We have been doing that for
25 years, and we will continue to do so in the
future as well. So purely from the standpoint
of the company name, Titan Company is more
wholesome than Titan Industries.
Our vision is to create elevating experiences
for people who interact with us as a company
and our brands. We were doing all of this before,
but now the new name has helped us crystallise
our vision better.
Over the last few years, we have become
more business-like and business-oriented. Real
economic value creation has been the hallmark
of the past ten years at Titan. We have been able
to achieve a value creating mindset within the
company and not merely create great brands,
great marketing and great products.
How would you assess the companys
performance in 2013? Please
elaborate on the high points and the
challenges faced during the year.
It was a very average year for us. The competitive
intensity in our businesses increased, but
consumer spending in many of our categories
was adversely impacted and that primarily
meant that we ended up with marginal growth
by the end of the financial year.
The biggest challenge we faced was in
the jewellery business. The industry saw
an unprecedented volatility in gold prices,
significant regulatory measures against the
import of gold, increased borrowings leading to
overall profitability being reduced compared to
previous years.
The high point was that we were still able
to have a long-term view and not be constrained
by the economic situation. We kept investing in

our businesses. We launched new plants for our

watches, jewellery and precision engineering
divisions. We also ventured into two new
categories helmets and fragrances.
How has the change in the business
environment over the past 12
months affected Titan?
The elections are coming up, and it is natural for
it to have an impact on the business. We havent
seen any major decision being taken by the
government in the past six months, and thats
primarily because of the general elections.
Talking of the jewellery business, there was
no review of the regulatory measures primarily
because bureaucrats were not willing to take
risks. At the same time the overall demand for
jewellery came down owing to a decline in gold
prices and inflation that affected spending.
Interest rates are on the higher side too
and Titan had to borrow after a period of zero
debt. But these things are bound to happen in
a bad economic environment. As a company,
we showed good agility in dealing with the
situation.
What are the plans for the next year
in terms of new businesses?
I dont see any new businesses being launched
next year. The two new businesses fragrances
and helmets have to achieve some level of
maturity. The eyewear business is also relatively
new and has to reach a certain scale and size.
We are busy stabilising the business and making
it grow.
The exploration of new business
opportunities continues. Our new businesses
division has been evaluating many
opportunities with the Titan Hexagon. The
Hexagon gives us the points to consider before
we enter a new business.
What are the challenges and
opportunities for Titan in the next
two to three years?
In the next two to three years, India will come
out of the bad economic situation it is in at
the moment, and I say that because India has

April 2014 

Tata Review

37

COVER STORY

the youth, all businesses have youthfulness

injected in their brands. Tanishq, for example,
has a brand called Mia, which is for a younger,
modern working woman who prefers more
contemporary jewellery. Our watch designs
appeal a lot to the younger generation. We have
positioned the eyewear business not merely as a
high-quality optical store, but also a store where
style is primary. As a company we have the
consumer at the centre and we will continue to
remain focused on her.
What are the new technologies that
your company is using to boost
productivity, improve
communication, manage costs, etc?
We scaled up our IT systems in 1997 when
we introduced ERP into the supply chain
operations of the watch business. We continue
to invest at the front-end in capturing consumer
data, analysing it and publishing it. We also use
digital media for marketing our products, but
I feel there is a lot more we can do in the IT
and digital space. We recently launched an HR
portal for our employees, which is easy to use
and extremely convenient.

managed its economy well in difficult times

in the past. Our finance ministers are being
sensible in not giving in to the temptation of
lower taxes. When the economy comes back,
Titan will be in the best position to leverage it
as we have our distribution network, brands,
products and production capacity in place. We
will reap the benefits of the economy turning,
which will certainly happen in two to three
years from now.
What is Titan doing to leverage the
burgeoning young, aspiration-led,
consumers of today?
Apart from Fastrack that specifically targets

April 2014
38 Tata Review 

Companies are now looking at

sustainability in all aspects of the
business what is Titan doing in
this area?
We created a separate sustainability team last
year with separate verticals for affirmative
action, safety, business excellence and corporate
social responsibility. The team has been carrying
existing programmes to higher levels and has
introduced several new programmes like the
adoption of an industrial training institute,
creating skill enhancement programmes, etc.
These are good times from the perspective
of bringing the focus back to our core,
becoming more efficient, shedding fat and
getting costs under control. It is a very good
period for us to understand better what we did
well, and what we didnt so that the future can
be even better. To sum up, this year has helped
us introspect and become stronger as
a company.

BUSINESS

For a greener world

Taking the sustainability mission forward, Tata
Housing continues to innovate with green
initiatives in the world of Indian real estate

raditionally, the real estate

and construction industry
has been a major contributor
to environmental
degradation, however, with growing
awareness of how this harms not just
our present but our future too, the
move towards sustainable practices is
growing in the industry.
Taking the lead in adopting
innovative and sustainable practices
in India, Tata Housing Development
Company has launched a concerted
drive to build eco-friendly and green
buildings. Says Brotin Banerjee,
managing director and CEO of
the company: We were among
the first few companies in India to
construct green buildings and we
did it because we believed that it was
the right thing to do. Not only from
the point of view of making money
or differentiating ourselves from the
competition, but because we believe
that sustainability in business is the
only way forward.
Tata Housing pioneered
sustainable green development at a

time when such a concept did not

exist in India. Today, it has the largest
number of green buildings and all
its projects follow the guidelines of
the Indian Green Building Council
(IGBC).
When Tata Housing first
thought of going green, the IGBC
had not come into existence. So,

for the very first green project that

the company took up Xylem, a
commercial building in Bengaluru
it followed the norms set up
by the Green Building Council of
the US, The Leadership in Energy
and Environment Design (LEED),
guidelines. We applied and got gold
rating under the US norms, explains
Mr Banerjee.
Xylem IT Park has an
ergonomic design and architecture
which has the occupants health as
its chief focus. The design boosts
employee productivity as well as

Some signicant projects

7XKDL(3/@QJ!DMF@KTQT*@QM@S@J@3GDBNLO@MXlRQRS
green project. It received a gold rating under the Green
Building Council of the US, the LEED, guidelines.
Myst, Kasauli, Himachal Pradesh: Biophilic (biophilia is the
instinctive bond between humans and other living systems)
landscape designs.
Riva, Bengaluru, Karnataka: Homes designed for senior
citizens.
Prive, Lonavala, Maharashtra: Smart homes integrating
technology with day-to-day living.
La Montana, Talegaon, Maharashtra: Designs based on
Spanish architecture.
Santorini, Chennai, Tamil Nadu: Township with
Mediterranean-style architecture.


April 2014 

Tata Review

39

BUSINESS

helps reduce the operational cost of

the building. This is one of the most
environmentally friendly buildings of
its size in the entire country.
THE ECONOMICS OF
ECO-FRIENDLY
Tata Housing projects account for
nearly a third of green development
in the Indian real estate business,
with 55 million sqft of the total
1.55 million sqft of eco-friendly
construction in India. Tata Housing
has, in fact, gone beyond just
constructing green buildings.
Mr Banerjee elaborates: We are
actively measuring carbon emissions
at all our projects. Teams are given
targets on mitigating our carbon
footprint. In addition, we are looking
at how we can achieve higher levels
of afforestation at our projects. Our
target is to see how we can reduce
our carbon footprint on a per square
foot basis.
But constructing eco-friendly
buildings has its own set of
challenges. While businesses are
fast realising the need for and the
benefits from investing in green
buildings, in the residential segment
the response is lukewarm. The
average home buyer is still primarily
driven by factors such as location,
affordability, quality and reputation
of the builder; the eco-friendliness
of a building does not figure as an
important consideration, especially
if it adds to the cost.
In our Xylem project, buyers

paid a premium as it was easy to

demonstrate performance metrics,
notes Mr Banerjee. But in housing
complexes, the benefits accrue over
a period of time so it takes longer to
realise the benefits of green housing
projects. The capital cost for
designing a building rated by
IGBC as platinum or gold is
comparatively higher than for nonrated one because there are several
criteria to be met, including the
kind of glass, water flow features,
air conditioning, lighting, the raw
materials and other equipment.
Double-coated, UVprotected glasses are far more
expensive than normal ones,
observes Mr Banerjee. There are
more than 50 points under IGBC
norms that green projects have to
meet and the rating is given on the
basis of these points. This is followed
by a stringent evaluation. The higher
the rating, the more your capital
expenditure would be. And meeting
these norms requires bandwidth on
the part of the developer.
To tackle this lack of awareness
of environmental issues in housing,
Tata Housing is trying to advocate
environmental sustainability among
customers and tell them about
the benefits of green buildings that
will prove profitable in the form
of water and energy savings and
reduction in wastage of resources.
Unfortunately, the government
and financial institutions dont offer
incentives which might motivate

In the light of the sustainability crisis

looming over the world, we have to realise
that it is no longer a choice but to go for
green buildings.
Brotin Banerjee, managing director and CEO, Tata Housing


April 2014
40 Tata Review 

developers and customers to go in

for green buildings. In the light
of the sustainability crisis looming
over the world, we have to realise
that it is no longer an option we
have no choice but to go for green
buildings, says Mr Banerjee. In
fact it is the right and responsible
way to do business and it needs to
be incentivised. No state in India
has a dedicated agenda for green
buildings. A policy framework will
be very helpful and go a long way
in encouraging this very desirable
development.
CREATING INNOVATIVE,
EVOCATIVE EXPERIENCES
Despite the challenges, Tata
Housing has continued to
innovate in its business offerings,
within the ambit of creating a
sustainable environment. Each of
its projects creates a unique living
experience to the consumer. It
has experimented with different
styles: Spanish architecture for La
Montana, a project near Talegaon
in Maharashtra; a Mediterraneanstyle of architecture for a recently

BUSINESS

A model of a spiral garden in Indias first biophilic project, Tata Housings The Myst
launched project, the Santorini in
Chennai, and an ambience of art
and culture at Raisina Residency in
Gurgaon.
In some projects, we have
used exclusive landscaping as a
differentiator, points out
Mr Banerjee. For example, it has used
biophilic (biophilia is the instinctive
bond between humans and other
living systems) landscape designs
in one of its projects, the Myst in
Kasauli in Himachal Pradesh.
Tata Housing, through its
subsidiary, the Tata Value Homes,
also has a sizeable presence in
the affordable housing segment.
Even here the company is offering
thematic projects with mixed use
development, where you have
different components which are
synergistic in the sense that they
feed off each other, explains Mr
Banerjee. So you have a work, live,
play kind of an environment. Many
people now choose to live in such
townships as opposed to individual
buildings because they foster a
sharing of resources and that itself is

a sustainable way of living.

Among its forays into new
areas is Tata Housings project Riva
in Bengaluru, which has homes
designed for senior citizens; Prive
in Lonavala, which is a smart homes
project integrating technology with
day-to-day living; and international
mixed-use projects, including
one under construction at Male,
Maldives, and another soon-to-beinked one in Sri Lanka.
INSPIRING IDEAS
In the highly competitive
environment that Tata Housing
operates in, it is very important to
have a regular pipeline of creative
and innovative ideas. To ensure this
happens, the company has created
an innovation council, a crossfunctional team made up of middle
and senior management leaders.
In a quarterly programme, all
employees have to stop regular work
and participate in an intense debate
and discussion with their bosses
and colleagues on new ideas for
three hours. The ideas are sent to the

council which then deliberates on

them; funds are allocated for those
that are accepted. The company also
encourages innovation at its building
sites, with a target to implement at
least one national and international
innovation each year.
The idea is to build a model
that encourages employees to
participate and take a risk, points
out Mr Banerjee. At Tata Housing,
we want to think differently and do
things differently. As a practice, we
aim to challenge people to think
differently. In a brick and mortar
industry, this brings a whiff of fresh
air. We also seek out customer
feedback which we can incorporate
in the projects.
Innovation and sustainability
are the two pillars that are taking
Tata Housing to new heights.
The many awards it has won for
its projects and for its approach
to business bear witness to
its commitment to building a
sustainable world for the future.
Shilpa Sachdev


April 2014 

Tata Review

41

BUSINESS

Engineering muchneeded solutions

From making life easier for people on the street
to e-governance solutions for governments,
CMC delivers IT solutions that are technologically
advanced and high on impact

hen residents of
Mysore city in the
state of Karnataka,
India, commute by
bus, they no longer have to waste
time waiting at the bus stand. They
can track the exact time of arrival
or departure of the bus on their
mobile phones and save valuable
minutes by reaching the bus stop
just before the bus arrives. Time


April 2014
42 Tata Review 

saved: Lots. Convenience: Much more.

This mobile-enabled bus tracker is an
answer to commuters woes, one
which eliminates much of the
uncertainty in catching a bus. And this
is thanks to the GPS-based intelligent
transport system (ITS) implemented
by CMC and deployed in the fleet
of buses operated by state-owned
Karnataka State Road Transport
Corporation (KSRTC).

A subsidiary of Tata
Consultancy Services (TCS), CMC
is a leading systems engineering
and integration company that
offers a wide basket of IT solutions,
ranging from application design
and development, to testing services
and turnkey projects. In recent
years, CMC has also expanded its
international business by offering offshoring advantages and delivering
value through service level based and
project scope based deliveries (see
box: International focus).
CMC has developed core
strengths in several niche areas where
it has delivered noteworthy projects,
and the transportation sector is one

BUSINESS

of them. Take the bus ITS project.

KSRTC is the first public transport
body in India to introduce a system
where real-time information relating
to the arrival of buses on specific
routes is available for passengers
through large LED displays at bus
stops as well as text alerts on phones.
KSRTC implemented the ITS
project along with the federal Urban
Development Ministry under a
World Bank programme to transform
the citys public transport system
into an efficient, safe, commuter- and
environment-friendly operation.
CMC was selected as the systems
integrator for the ITS project.
CMC managing director
and CEO R Ramanan says that
the system is being rolled out
across Karnataka: The GPS-based
product has been mounted on all
local buses in Mysore. We are also
implementing this ITS system for all
5,000 buses operated by KSRTC in
Karnataka. CMC has replicated the
ITS in the state of Andhra Pradesh

We solve complex societal or business

problems using technology while
ensuring that there is a core product,
which we develop.
R Ramanan, managing director and CEO, CMC

and is bidding for similar projects

across India. It is also implementing
an intelligent transport project in
Botswana in southern Africa.
BIG TICKET SOLUTIONS
What CMC brings to the table is
its extensive domain knowledge in
the transportation business. It has a
successful track record of designing
and implementing state-of-the-art
IT solutions for large operators with
extremely complex systems.
The basket of transport solutions
from CMC covers railways (including
metro rail operations), aviation,
roads and ports, with leading stateowned behemoths as key customers.
For Indian Oil Corporation, it has

The upward curve

2002

19.26

2013

All values in INR billion

12.23

6.25
1.56
3.15

2.3
0.2

Consolidated
operating
revenue

1SPU

after tax

0.27

EBITDA

International
business

implemented a fuel dispensation fleet

management system covering more
than 22,000 vehicles that transport
petroleum products across India.
IOCL can track real-time movement
of these vehicles, helping it prevent
pilferage and monitoring the
dispensation of fuel.
CMC has worked extensively
with the Indian Railways, providing
it with its passenger reservation
system and even an unreserved
ticketing system. We have created
a generic ticketing system for rail,
road, ports and ships, which can be
deployed by operators, travel agents
and hotels, says Mr Ramanan.
The company is now
developing a state-of-the-art
ticketing and revenue management
system, a next-generation version
of the one it developed for the
Indian Railways. This will enable
cloud-based and rich analytic-based
dynamic configuration of ticketing
products. Today, transport
operators want to offer flexible
products targeting various segments
of customers for different seasons,
explains Mr Ramanan. They want
to be rapidly able to dynamically
configure a product and they want
it to be cloud-based as they do not
want to invest in hardware. CMC is
looking at customers both in India
and in geographies such as Europe
and Africa for marketing these new
solutions.
Aviation is another big area for
the company. CMC works closely

April 2014 

Tata Review

43

BUSINESS

International focus
Known originally as the Computer Maintenance Corporation,
CMC was established in 1975 by the Indian government to
take over the maintenance of 800 IBM installations across
India after the American company decided to wind up its
operations in the country.
As a public sector enterprise, CMC operated at margins
as low as 3.5 to 4 percent. When CMC became part of the
Tata group we decided to transform the company, says
managing director and CEO R Ramanan, who joined TCS way
back in 1981 and took over as COO of CMC in 2001.
The transformation occurred in three areas: moving
away from low-value businesses to high-value solutions,
bringing in world-class processes and systems to raise
NODQ@SHNM@KDEBHDMBHDR@MCDMG@MBDDLOKNXDDOQNCTBSHUHSX
and changing the business mix by shifting the focus from
the government sector to the private sector and even
international business.
As part of TCS and the Tata group, we could easily
implement some of the world-class processes and systems
available within the group, including the Tata Business
Excellence Model, points out Mr Ramanan.
(MRB@K","@CCDC@ANTSMDVBKHDMSR
and recorded a turnover of `19.26 billion. International
operations saw a phenomenal 40 percent growth. Over
the last three years, it has been growing at a brisk 25 to 30
ODQBDMS@MMT@KKX 6HSG@RBNQDNENUDQRD@RNEBDRHMBKTCHMF
in the US, the UK, Europe, the Middle East, Africa and New
Zealand, CMC which has about 12,000 employees aims to
aggressively grow its international operations.
In markets such as America, CMC will focus on the
GHFGSDBGRDFLDMSSQ@MRONQS@SHNMM@MBH@KRDQUHBDR@MC
media for digitisation of services. In emerging geographies,
it will focus on insurance, transportation, shipping and ports,
energy resources and government as big drivers. In India,
we see huge potential in all these areas and also in defence
and space, says Mr Ramanan. We will focus on product
innovation, developing a solution around a product or
creating a product to enable our clients to reach out to their
customers. We want to be a value-accelerator and valueadder to TCS, the Tata group and to our customers.
CMC is today a leader in the general insurance segment
in India and ranks among the top three in the world in the
ports and shipping sector.


April 2014
44 Tata Review 

with the Airports Authority of

India (AAI), which manages
125 airports in the country,
and the defence forces for their
radar handling systems. We
are now looking at airport and
ground operations management
systems, says Mr Ramanan.
We see opportunities in airport
modernisation (which would include
deployment of IT infrastructure,
surveillance systems and baggage
handling systems), ticketing and
retail management systems within
an airport, and more sophisticated
projects, including in the area of air
control.
For the ports segment, CMC
has developed three flagship
products a marine container
handling system, a cargo and
logistics management system and a
warehouse management system.
SYSTEM INTEGRATION
The power of these products comes
from CMCs years of experience
and strengths in system integration.
That is our competency, says
Mr Ramanan. We solve complex
societal or business problems using
technology while ensuring that
there is a core product, which we
develop. It could be an application,
a hardware piece such as a GPS unit,
or a combination of hardware and
software. We build an entire, end-toend solution around this.
And that is where integration
comes into play. This calls for four
different types of capabilities:
The underlying hardware
infrastructure required to operate
the solution.
The software solution running on
top of it.
Digitisation and workflow
management as an integral part

BUSINESS

From left: A Karnataka State Road Transport Corporation control centre; the arrival schedule displayed in a bus shelter
of operationalising the business
process.
Real-time systems, sensor-based
technology, or technology related
to devices used.
As a result, CMC has built up a
significant presence in sectors such as
transportation, energy resources and
utilities, ports and shipping, mining,
insurance, banking and financial
services, e-governance, and education
and training.
REAL-TIME SOLUTIONS
CMC has over three decades of
experience in providing consultation,
design and development services,
and testing services in real-time
systems. The embedded and real-time
solutions and engineering services
group, which employs a thousand
people, caters to some of the worlds
leading product manufacturers,
participating in their embedded
systems design, development and
testing life cycle phases.
For instance, for TRW
Automotive, a global leader in
automotive safety, CMC has set
up a 500-person centre in India,
supporting its operations in Europe,
the US and other parts of the globe.
TRW selected us as the only partner
for its low-cost electronic design,
remarks Mr Ramanan.
Similarly, CMC has a facility
in Bengaluru that supports Ansaldo
STS, a leading technology company
in the railway and mass transit
transportation systems space, in
the areas of signaling and collision
avoidance systems. All these services

call for a high degree of domain

knowledge, and electronic hardware
and software design capabilities.
For the mining industry, CMC
has developed a pit-to-port solution,
which helps miners keep track of
expensive equipment in remote
mines, tracking both their inventory
and commodities such as iron ore.
We are now deploying our flagship
mine management solution in
different parts of the world, adds
Mr Ramanan.
Another product that is going
overseas is CMCs web-based, core
insurance product Genisys, which
is being marketed to insurers in
the Middle East, Africa and other
emerging markets.
POWER OF THE INTERNET
Another exciting area of opportunity
for the company is in e-governance.
CMC has developed portals for
several state governments including
those of Assam, West Bengal,
Odisha, Chhattisgarh and Karnataka,
which help citizens access
various government services. The
Chhattisgarh Online Information for
Citizen Empowerment (Choice), for
instance, enables citizens to access
nearly 200 government services.
In addition, the company has
implemented treasury management
services for a couple of state
governments and is also deploying
an integrated revenue and treasury
management system for the revenue
authority in Rwanda.
A new arena for growth is sensor
technologies. We are looking at the

internet of things (a concept that

envisages tiny sensors or identifiers
that can be attached to millions of
smart gadgets or things) as an area
where we can contribute in a big way,
notes Mr Ramanan. This would
mean integrating sensor technologies
and making a meaningful impact on
the information collected and the
actions taken on the basis of that.
The company also runs about
120 training centres across India.
The focus is on creating job-enabling
training programmes, both at the
technical and vocational levels.
MOBILITY IS KEY
CMC has recently launched an
initiative called CMC 3.0, which
focuses on SMAC social, mobile,
analytics and cloud services. It is
looking at integrating social media
with an app that can be used in its
education and training vertical;
likewise, CMC is integrating mobile
devices with an app that is helping
multinational Unilever in its retail
operations. It has also developed
mobility apps for the banking and
financial services sector, helping
integrate core banking and core
insurance solutions. Mobility is
getting integrated into virtually every
project that we do in some form or
the other, says Mr Ramanan.
CMCs vision is to be
among the global top-20 systems
engineering and integration
companies by 2020. And it is steadily
moving ahead on this journey.
Nithin Rao


April 2014 

Tata Review

45

BUSINESS

Voice of the 49 percent

The Power of 49 campaign from Tata Tea has
scaled up tremendously in its second phase as it
seeks to realise the power of 100 million informed
women voters in India

ata Teas latest campaign,

The Power of 49, is a
message that combines
two powerful forces the
100-million-strong informed women
voter base in India and the power
of informed choice in an election.
It also leverages the employee base

across Tata companies which has

joined hands with Tata Global
Beverages and the Tata Tea brand
to put the power of social change in
the hands of women across India.
The campaign is receiving a terrific
response from all over the country;
social media in particular is abuzz

We got about 40,000 to 50,000 calls

a day, which is quite unheard of in this
space. A million and a half women have
logged in their issues.
Vikram Grover, vice president, marketing, South Asia,
Tata Global Beverages


April 2014
46 Tata Review 

about the initiatives. It is arguably

one of the largest social awakening
campaigns the country has seen.
The most visible part of the
campaign is the new commercial
that highlights the power women
can wield by voting. Set in an
upmarket salon, it shows one of the
women customers advising the rest
on using a pepper spray as a strategy
for self defence. A young salon
employee disagrees, saying that she
does not need the pepper spray as
she believes in the power of the kala
teeka or black dot in other words,
the voters mark.
Her words instantly impress
the women present at the salon,
who realise the power of their
vote through which they can
choose candidates who can make a
difference to issues such as womens
safety. Directed by Gauri Shinde, the

BUSINESS

commercial resonates well with Tata

Teas well-established advertising
style hard-hitting and direct, with
a strong message on social change.
Vikram Grover, vice president,
marketing, South Asia, Tata Global
Beverages, explains the idea behind
the commercial, The Power of
49 came about as a result of our
understanding of the attitude of
women towards elections. Women
in India dont realise the power that
they wield. They cast their vote not
based on issues but on whom their
family is voting for. As a result,
the political class does not pay too
much heed to their issues. Tata Teas
women-oriented campaign aims to
change that mindset.
HALF OF THE VOTE BANK
To achieve the extremely ambitious
vision of creating 100 million
informed voters, it was necessary for
Tata Tea to launch a multi-pronged
campaign that aims to reach out to
all women of the country, regardless
of their background and education.
The first phase of this campaign
was about inspiring women and
awakening them to the power of
their vote by telling them that they
form 49 percent of the electorate.
The idea behind the second
phase of the campaign which is
now running across media platforms
is about helping women leverage
the power of the 49 percent by
encouraging them to vote based on
issues that affect them. For this,
Tata Tea has entered into multiple
partnerships to maximise womens
involvement from all over the
country.
In order to connect with
women from rural and semi-urban
India, Tata Tea roped in five wellknown TV actors who portray

popular bahu (daughter-in-law)

roles. The initiative titled Bahu
Nahi Bahumat Hai uses these actors
to encourage women across the
country to think about their issues
and log them in with the company.
This successful initiative is pulling
in as many as 50,000 calls a day
from women. Mr Grover says, We
have aggregated all these issues
and created a manifesto that will be
handed over to the political class to
initiate a discussion about womens
issues which are largely ignored in
our country.
Tata Tea has entered into
a partnership with TV18 for
organising a discussion on womens
issues in India. Mr Grover explains
the rationale behind the tie-up, The
reality of politics in our country is
that if you try to organise such an

initiative on the ground on a large

scale, there is a chance that it will
get hijacked by political forces, and
that is something we dont want.
He underscores the point, It is a
Tata initiative and we are going to
maintain a neutral stand.
DOWN TO THE PIN CODE
LEVEL
For promoting the campaign, The
Power of 49 campaign is using the
Jaagore.com website extensively
to create a large base of informed
voters. People can register on the
website to vote and log in issues.
In a deepening of the engagement,
Tata Tea has introduced an initiative
called Push the Pin which is
an interactive and GPS enabled
application that allows women to
log in issues like safety, education,

Bahu nahi bahumat hai:

Soap stars weigh in
Tata Tea has partnered with popular soap stars from leading
entertainment channels to spread the message of Power of
49 and connect with women of rural and semi-urban India.
Vignettes with these leading ladies are being aired regularly
on entertainment channels, where women are encouraged
to voice their concerns and vote based on issues. Some of
the leading ladies include Sandhya from Diya aur batti hum
(StarPlus), Akshara from Yeh rishtha kya kehlata hain (Star
Plus), Kamla Tai from Ek mutthi asmaan (Zee TV), Gunjan
from Sapne suhane ladhakan pan ke (Zee TV) and Anandi
from Balika vadhu (Colors).
In the vignettes, women are asked to call a certain
number to log in their issues and the response to this has
been phenomenal. Mr Grover says, We got about 40,000 to
50,000 calls a day, which is quite unheard of in this space. A
million and a half women have logged in their issues and this
LTRSADSGDQRSSHLDSGDONKHSHB@KBK@RRG@UDFNS@L@MHEDRSN
that represents the views of so many women.


April 2014 

Tata Review

47

BUSINESS

The Power of 49 team worked relentlessly to ensure the success of the campaign
health, etc along with their residence
pin code numbers.
This unique step taken by the
Jaago Re website will help create a
community of empowered users by
initiating thought-provoking debates
and providing information that is
vital to young women voters.
Mr Grover says, With Push the Pin,
people can go online and log in their
issues at a pin code level. We have a
large number of issues that are being
logged in at a very local level and we
will organise ways to feed in these
issues to politicians in the hope that
they will respond.
Another interesting partnership
is with Google, where plans are
on to interview 1,000 candidates
from leading political parties. These
candidates will give their views on
how they will be addressing the
issues of women at a local level.
These video interviews will go a long
way in helping women choose the
right candidate.
CREATING HISTORY
The Power of 49 has created history in

April 2014
48 Tata Review 

its own way by launching the largest

voter registration drive the country
has seen. These registration drives
are in partnership with Haiyya, a
Mumbai-based NGO, and The Art
of Living. Haiyya is an NGO with
expertise in training people; it has
trained volunteers from Tata Global
Beverages and other Tata companies
to conduct voter registration drives.
Mr Grover explains, Haiyya has
created e-learning modules and other
training collateral to help empower
volunteers whom we are calling
evangelists. When companies want
to run voter registration drives, it
is Haiyya that provides support to
facilitate these camps. Evangelists
from different companies become
volunteers for voter registration and
train other volunteers within their
own companies.
Yet another feat is that the
Election Commission of India has
granted Tata Tea special permission
for bulk submission of registration
forms across the country. The only
corporate entity in the country that
has been granted this permission,

Tata Tea has facilitated the voter

registration of thousands of
individuals across the country in
partnership with The Art of Living.
AMPLIFICATION
The Power of 49 campaign is getting
a big boost from the support of other
Tata companies, which is helping
the message reach further across the
country. One example is the way Tata
company representatives have trained
volunteers and conducted voter
registration drives at their offices and
sites of operation.
An ideation workshop was held
in December 2013 to familiarise
Tata companies with the concept
and invite ideas. Evangelists from
different companies were trained to
take it forward in their respective
organisations. Vaibhav Rathi, brand
manager at Tata Global Beverages,
says, Our intention was to first get
employees within the group registered
to vote and then look at how each
company could communicate the
message of the campaign externally
through their assets.

BUSINESS

As many as 40 Tata companies

participated in the evangelist
workshops and have not only adopted
the concept with passion, but have
also amplified it internally with great
zeal. For example, Tata Housing is
offering a discount of Rs49,000 for
one of its properties for women who
register as first applicants.
The company is also helping
its customers in the process of voter
registration. Titan has put in voter
registration kiosks across its network
of stores. Tata Tea has changed its
pack designs to display the visual of
The Power of 49 campaign.
Other Tata companies such
as Indian Hotels, Voltas, Tata Steel,
and Tata Consultancy Services have
conducted multiple voter registration
drives across the country. Tata Sky
has been featuring The Power of 49
AV and the commercial prominently
across its Active series of channels.
Croma, the electronics megastore,
has given prominence to The Power
of 49 campaign on its online retail
portal. Says Mr Grover, Without
the encouragement and the support
of the Tata group, the internal leg of
the campaign, which is so important,
would not have been so strong.
Dr Mukund Rajan, brand custodian
and chief ethics officer, Tata Sons, and
member, Group Executive Council,
has spoken to the press about The
Power of 49. The fact that the Tata
group is talking about it is creating a
buzz which we would not have been
able to build on our own.
The campaign is one of Tata
Teas biggest so far. With multiple
initiatives running simultaneously,
The Power of 49 campaign has
generated an enormous amount
of content ranging from vignettes
of soap stars to sound bites by
Bollywood actors, political interviews

The 10-point manifesto

The Voice of 49 manifesto was released by Tata Global
Beverages and the Tata group. The key issues it raises are
around the themes of violence, safety, health and education.
These themes are based on the issues logged in by women
as part of The Power of 49 campaign, which were analysed by
a team of experts led by the editorial team of CNN IBN.
Highlights
1. Politicians must lead by example by displaying zero
tolerance for perpetrators of domestic abuse and dowry in
political parties.
2. Address the under representation of women in the
parliament through increased representation in party ticket
distribution as well as in the cabinet.
3. Make gender sensitisation for boys a compulsory part of
the school curriculum from Std V to XII in order to counter
eve-teasing.
4. Increase percentage of women police personnel from
current 5 percent to at least 33 percent.
5. Build a combined front line army of government workers,
NGOs, local health and sanitation workers, and accredited
social health activists.
6. Build one crore women toilets within a year with privacy
and 24/7 access to water.
7. Provide mandatory crches and women-friendly maternity
policies that include long-term leave in both rural and
urban areas.
 (MBDMSHUHRDRBGNNKHMFENQFHQKRAXOQNUHCHMFM@MBH@KR@UHMF
schemes and free transportation.
9. Install GPS on all buses, double the number of street lights
and provide round-the-clock public transportation for
women.
10. Provide complete medical, legal and psychological
support to victims of domestic violence by instituting
special family counselling centres in government buildings
and policy centres.

to policy discussions. It is also an

initiative that has enabled brand
Tata Tea to successfully build on its
communication platform of social
awakening engaging consumers
emotionally and inspiring them to act

on issues that impact them. And its

well and truly on track for creating a
force of 100 million women who will
go out and vote, making it count.
Vibha Rao


April 2014 

Tata Review

49

BUSINESS

The defence connection

The partnership between the Tata group and the
Ministry of Defence of the Government of India
IBT
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BOE

dependence on imports, indigenous innovation,
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RVBMJUZ
BOE
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ndias borders stand strengthened.

Sophisticated weaponry stand
ready for protection: armoured
amphibious platforms, blast-proof
vehicles, unmanned aerial vehicles,
multi-barrel rocket launchers,
electronic warfare systems and
nuclear submarine control centres.


April 2014
50 Tata Review 

All are products of a longstanding

public-private partnership between
the Tata group and the Ministry of
Defence (MoD) of the Government
of India.
Keen to reduce dependence on
imports and stimulate indigenous
innovation in the development of

products for the defence sector,

the Indian government, over the
last decade, has actively urged
private sector players to partner
public sector undertakings,
R&D organisations and defence
institutions in profitable publicprivate partnerships.
TRUSTED PARTNER
A fine example of the public-private
partnership model in defence has
been that between the Tata group
and the MoD a relationship
lasting over 60 years. Stepping up its
engagement significantly in recent

BUSINESS

Convergent defence solutions from the Tata group range from blast-proof
vehicles to multi-barrel rocket launchers to the Mars Orbiter Mission

years, the group has emerged as a

trusted and reliable partner for the
three wings of the forces the
army, the air force and the navy.
The defence business generated
`17 billion in turnover for the
group in fiscal 2013, and the 14
companies involved in the sector
have an order book adding up to
over `80 billion. Mukund Rajan,
brand custodian and chief ethics
officer, Tata Sons, and member,
Group Executive Council, notes
that the groups defence business
will expand by a hefty 40 percent in
fiscal 2014. There is tremendous
scope for the Indian private sector
to play a much bigger role in
defence, he remarks. The private
sector today has a relatively small
percentage share of the total Indian

defence spend, and significantly less

than in many other countries.
With expertise in technology
and project management and
the effective utilisation of a wide
range of competencies, the Tata
group is well positioned to enter
into virtually any area where the
MoD wishes to build private sector
capabilities, adds Mr Rajan.
The unique strength of
the group is that it can provide
convergent defence solutions
for complex projects thanks to
collaboration between various
group firms, thus meeting the
multiple requirements of defence
customers.
Three noteworthy examples of
this include:
System integration by the Tata

Financial
snapshot
The Tata groups
revenue from the
defence business
was over `17 billion
in FY 2013.
Going forward in FY
2014, this revenue is
expected to grow by
40 percent.
The current order
book size of the Tata
group in the defence
business is in excess
of `80 billion.


April 2014 

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51

BUSINESS

Power Strategic Engineering

Division (SED) on a Tata Motors
chassis for the Akash missile
system.
The joint setting up of
engineering, tooling, training
and assembly operations for
an aerostructure project in
Hyderabad by Tata Advanced
Systems (TASL) and Tata
Consultancy Services (TCS).
Tata Power SED and TCS
working together extensively on
security applications.
Of the 14 Tata companies
involved in a public-private
partnership with the defence forces,
three account for a substantial
part of the groups presence in the

defence space TASL, Tata Motors

and Tata Power SED.
TATA ADVANCED SYSTEMS:
THE MISSILE SPECIALIST
A 100 percent Tata Sons owned
company, TASL has signed contracts
worth over `40 billion and has joint
ventures and partnerships with
major global players in the defence,
aerospace and security domains.
TASL operates Indias largest
private sector, integrated, detailed
part manufacturing facility for
aircrafts and helicopters in a joint
venture with Sikorsky. Says Sukaran
Singh, director, TASL: We are the
single global source for the assembly
of helicopter fuselage for one of the

Tata rms in the defence sector

Tata Motors
Tata Power (Strategic Engineering Division)
Tata Advanced Systems
Tata Advanced Materials
Nelco
Tata Consultancy Services
CMC
Tata Elxsi
TAL Manufacturing Solutions
Tata Technologies
Titan Company
Avana Integrated Systems
Nova Integrated Systems
Tata Industrial Services
Defence capabilities
Tata group companies have partnered with the defence
forces across areas such as:
Command and control.
Network-centric warfare including naval combat.
Air defence tactical communication.
!@SSKDDKCL@M@FDLDMSRXRSDLR
Trusted compute platforms.


April 2014
52 Tata Review 

best-selling helicopters, the Sikorsky

S-92, used for VVIP transport. The
company has three different units
producing globally-competitive
products for helicopters and the
aerospace sector.
TASL is also the single
global source designated for the
empennage (tail and tail assembly)
and centre wing box structures for
Lockheed Martins C 130J military
transport aircraft. It shows the
kind of confidence that a company
like Lockheed Martin has in us by
designating us as the single source
for a major part, adds Mr Singh.
The company has invested
over `4 billion in the last five years
and has set up production facilities
spread over 450,000 sq ft across
India. Employing more than 1,500
people, TASL holds major defence
licences and is a participant in
strategic development and buy-andmake programmes of the MoD.
Another major area of business
for the company is missiles.
TASL is the lead integrator for
the development and assembly of
command and control systems for
Indias major missile programmes
and it has created a design and
development centre for indigenising
missile sub-systems and mini-UAVs.
TATA MOTORS: THE
MOBILITY PARTNER
A Tata company whose relationship
with Indias defence and security
forces is synonymous with that of the
group is Tata Motors. Indias largest
automobile company (subsidiaries
include Jaguar Land Rover), with
consolidated revenues of almost $35
billion in 2012-13, is strategically
moving from the logistics vehicle
segment into the combat vehicle
segment.

BUSINESS

A leading supplier of mobility

solutions, it has supplied over 100,000
vehicles to the Indian military and
para-military forces thus far.
Tata Motors has partnered the
Defence Research and Development
Organisation (DRDO), a premier
MoD research body, on projects
such as the Prahaar missile
launcher, the quick deployment
communication terminal, the light
armoured troop carrier, the bomb
disposal van and the wheeled,
armoured amphibious platform.
According to Vernon Noronha,
vice president, defence and
government business, Tata Motors,
the defence forces have over the
years realised that the company
has the capability to indigenise
technology and deliver world-class
vehicles at realistic costs. Our
strength comes from our R&D
facilities in the automobile sector,
explains Mr Noronha. We got
into the bullet-proof and blastproof business because of our
facilities, which helped us to
develop this technology.
In addition to the Indian army,
navy, air force and various paramilitary forces, the company now
also supplies to the defence forces of
other countries including Sri Lanka,
Bangladesh, Nepal and Tanzania,
and to UN peace-keeping forces in
conflict zones in Africa.
The company showcased
two new combat vehicles at the
Defexpo 2014 at New Delhi: Kestrel,
a wheeled, armoured amphibious
platform providing mobility to
frontline soldiers in the battle zone
with armour protection backed
by fire support, and a lightarmoured, high-mobility
reconnaissance vehicle that will
move ahead of armoured columns.

We believe that we have the ability to

invest in innovation and collaborate with
the government to co-create and develop
new technologies.
$R-UKUND2AJANBRANDCUSTODIANANDCHIEFETHICSOFCER4ATA
Sons, and member, Group Executive Council

TATA POWER SED: THE

ELECTRONICS STRATEGIST
One of the largest prime contractors
in the Indian defence sector, Tata
Power SED has partnered the
MoD, the armed forces, defence
public sector undertakings and the
DRDO for more than 40 years. It
has executed projects of national
importance such as Pinaka, a multibarrel rocket launcher; the Akash
launcher systems for the air force
and the army; the integrated guided
missile development programme;
the Samyukta electronic warfare
system; and the Arihant nuclear
submarine control centre.
Established as a defence R&D
company in 1974, the company
evolved into a prime defence
contractor in 2006 and is the only
Indian private sector company to
have won three prime contracts
against global competition. The unit
recorded a turnover of `2.93 billion
in fiscal 2013, and has a strong order
backlog of `27.7 billion. Its R&D
spend is more than 10 percent of
its turnover.
The fact that we are an
indigenous, defence-focused prime
contractor emerged out of our
quest for substantive self-reliance,
explains Rahul Chaudhry, CEO,
Tata Power SED. We have the
ability to conceive a product and
undertake the entire validation
process, which allows us to do
the design and manufacturing. A
400-seat R&D centre for defence

in Mumbai and a supplementary

centre in Bengaluru enable constant
R&D and innovation. The unit has
adopted a consortium approach with
other Tata companies, to pool core
competencies and leverage strengths
in development, manufacturing and
turnkey solutions.
It has emerged as the premier
private sector player for strategic
electronics with integrated
design-to-production capabilities
and a proven track record of
developing, integrating, installing,
commissioning and providing life
cycle support.
The Tata group believes in
long-term value creation for all its
stakeholders, maintaining the highest
ethical standards in the conduct of
business. These facets of the group,
our long-term orientation and our
commitment to ethical conduct,
resonate very well with the needs of
the defence sector, where there is a
high premium placed on partners
who have long-term commitment
to see products through multiple
generations of evolution, and who are
committed to the highest standards
of ethics, observes Mr Rajan. We
also believe that we have the ability to
invest in innovation and collaborate
with the government to co-create
and develop new technologies, and
support the deployment of new
capabilities, making India more
self-reliant.
Nithin Rao


April 2014 

Tata Review

53

BUSINESS

Inspired by design
The focus on design and innovation has become
stronger at the Tata group in response to the
growing awareness of how good design enhances
the value of the brand and creates stronger,
longer-lasting consumer experiences

he difference between a
me-too product and a
well-designed one is that
the former merges into
the background and the latter
stands out from the clutter. Design
combines creativity and innovation
to create a product that enhances
the user experience and delights
the consumer.
At Tata, a group of companies
have come together to drive the
new mantra of design-driven
innovation in order to build a
sustainable, competitive advantage
for their products and services.
A recent roundtable conference
titled Design@Tata was the setting
for senior leaders from Titan
Company, Tata Technologies, Tata
Global Beverages (TGB) and Tata
Elxsi to discuss why design is a key
function in their organisation
and how it translates into value
for the brand.


April 2014
54 Tata Review 

How Titan
thinks design

perating in the fashion and

lifestyle space where visual
appeal and user experience is of
paramount importance Titan
Company regards design as a crucial
function. Indias leading watch
and jewellery maker, Titan has
developed two distinct capabilities:
for thinking design and for
executing design.

Revathi Kant, associate vice

president, design, innovation and
development, at Titan, explains,
Design enhances the brands image,
so keeping that in mind, we have
created two separate teams for design.
We have a team that only does the
thinking work. Its functions include
understanding the business and its
customers, and developing a strategy
or an idea based on the design.
Titans superior product
aesthetics are a result of the
seamless integration of design
thinking and, its next step, the
actual designing. Titans robust
design process called 3I design
has stages for immersion, ideation
and implementation.
This design innovation at Titan
ensures that its conceptualised
and created products stand
differentiated in the marketplace.
We try and use our design concepts
in the companys other business
categories, so that efforts are not
duplicated within
the company, says
Ms Kant.

BUSINESS

Refreshing designs at TGB

perating in the fast-moving

consumer goods sector, TGB
is aware that design can play a vital
role in increasing sales, especially
on retail shelves where a great pack
design can attract customers. A
good design for a brand can refresh a
brand completely, scaling its business
substantially, says Sushant Dash,
global brand director, Tata Global
Beverages.
TGB says that a great design
often depends on getting the very
first step right having a deep
understanding of the business and the
customer. A case in point is the Tata
Tetley innovation, which increased

sales for the brand substantially.

Based on the insight that the string
tea bags were messy, we designed
the Tetley drawstring. This helped
eliminate the dripping and allowed
for easy disposability.
Although direct linkages
between design and sales are often
not possible, what is indisputable
is the impact on the brand image.
In many cases, we have found
improvements in brand imagery
post improvements in design or its
packaging, says Mr Dash. One such
example is the Tata Tea Gold standypack, a modern design that translated
into premium imagery for the brand.

Designed by Tata Technologies

engineers

ithin the Tata universe, Tata

Technologies occupies a unique
space where design meets
engineering meets IT. With
6,500 people on its rolls,
Tata Technologies uses its
design and engineering skills
to create solutions for the
automobile, aerospace and
heavy engineering sectors.
Design is integral to the

work that Tata Technologies does

as it creates products that establish
new benchmarks for a list of clients
that include global leaders. Gopinath
Jairaj, president, global delivery, Tata
Technologies, shares his companys
approach to designing products
for its customers: By deploying
engineering and technology in
designs, we are able to convert
consumer insights into classdefining products.
Embedding high-end design
capabilities in its core business
process is critical to the path that
Tata Technologies has mapped out
for itself that of becoming the
worlds number one partner of the
manufacturing industry.

Tata Elxsis
attention to detail

t Tata Elxsi, the role of design is

to solve the customers business
problem. Working closely with
several companies in the product
and industrial design space, Tata
Elxsi has expertise in both design
and technology, and uses innovation
and design to add value across the
brand and the product development
lifecycle.
Nick Talbot, global design head
at Tata Elxsi, is unequivocal about
the significance of design: Design
can increase a companys sales or
revenues, but to do this it has to
create an experience for its customers
that will have a lasting impact
on their minds. Every 1 percent
intelligently spent on good design
can possibly yield a 3-5 percent
increase in revenues for a company.
This is why Tata Elxsi works as
a strategic partner with its clients to
create a differentiated brand and to

April 2014 

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55

BUSINESS

address the needs of the consumers.

Says Mr Talbot, With the rapidly
changing demands and requirements
of consumers, blending creative
design with technology has become
the need of the hour for companies.
At Tata Elxsi, a design project
is broken down to several smaller
elements for a brand design, for
example, it may include crafting
the story of a brand, the values it
represents, the tone of voice it uses

to converse, the colours it uses to

attract, etc. Whats needed is a
clear objective for the design, says
Mr Talbot. This translates into an
idea or a strategy, while the rest is
all about quality execution with a
strong focus on detail.
A recent successful design
makeover was for Bru, the 50-year
old coffee brand from Hindustan
Unilever (HUL). With the rise
in consumer interest in gourmet

The T2 experience
One of the most visible outputs from Tata Elxsi today is
its work on Mumbais sparkling new, critically-acclaimed
airport terminal the T2 terminal at the Chhatrapati Shivaji
International Airport.
Bringing in its strength in integrating creative design
with technology, Tata Elxsi worked in collaboration with
the GVK group to design the experiential services across
various consumer touch points at T2. This included designing
entertainment zones, customer service zones and general and
lifestyle seating areas from security through to boarding gates.
Other work included designing pay phones, charging stations,
ATM and vending machine housing and internet workstations
and kiosks.
T2 is a distinctly unique terminal that meets international
RS@MC@QCRVGHKDDMRTQHMFRTRS@HM@AHKHSXQDDBSHMFDKDF@MBD
and a better convenience and comfort experience. It is a
landmark achievement for Tata Elxsi in terms of the high
quality of design, technology and innovation.

cuisine, Bru had to make its

presence felt in the premium end
of the coffee market, which was
dominated by international brands.
Tata Elxsis task was to uplift the
traditional imagery of the brand by
creating an international appeal.
To achieve this, it developed a
unique pack design with a glass
finish and an innovative cap design.
The premium look and increased
visibility led to increased market
share for HUL.
DEMAND FOR DESIGN
In a country like India, where
customer expectations are
being driven by the rising youth
demographic and the increasing
exposure to international brands,
design can play a vital role in
not just building a brand but in
defining it. Consumers today do
not pay much heed to marketing
campaigns, instead they look to
break away from the advertising
clutter and thats where design
becomes pivotal, providing a single,
visible opportunity for a brand to
stand for something that is relevant
to the audience. Interestingly, this is
irrespective of business category, be
it a consumer durable such as a car,
or a lifestyle product like a watch, or
a consumable such as a beverage.
Innovation has for long been an
area of focus at Tata, with several panTata initiatives in place to encourage
and support innovators. Of late, the
need for strong design capabilities
has led to the Tata group looking to
support and build its design skill sets.
After all, it is designers across the
group that are, at this very moment,
working to create the brands and
products of tomorrow.
Rishi Vora


April 2014
56 Tata Review 

SPECIAL REPORT

Invested in innovation
Innovation is at the core of the Tata group. The group encourages
innovation through several programmes and, in 2012-13, spent
`132.23 billion or about 2.5 percent of its turnover on innovation.
Talking to Tata Review, R Gopalakrishnan, chairman, Tata Group
Innovation Forum, looks back at the innovation journey; Ravi Arora,
vice president at Tata Quality Management Services, shares the nuts
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TCS Anant Krishnan and chief executive of Tata Steel Europe Karl
Koehler talk about the innovation initiatives in their companies.


April 2014 

Tata Review

57

SPECIAL REPORT

The innovation sanskar

R Gopalakrishnan, director,
Tata Sons, and chairman,
Tata Group Innovation Forum,
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JOOPWBUJPO

journey of the Tata group

e didnt call it innovation in those

days, but innovativeness has always
been a part of the Tata groups
sanskar (traditions), its way of
thinking. In recent years, we have adopted the
global practices associated with encouraging
innovation in the group, and these have added
more power to the spirit of innovation that has
been such an integral part of the Tata way of
doing business.
It is important to understand that there
are several myths about innovation. Disruptive
innovations are not always planned for, they just
happen. Alexander Flemming never set out to find
penicillin, he stumbled upon it while researching
something else; chemically synthesised fertiliser
may not seem like an innovative product

When I look back, I am glad

that we started on our formal
innovation journey the right way
and chose the culture route.
R Gopalakrishnan, director, Tata Sons; chairman, TGIF


April 2014
58 Tata Review 

today but at the time it was first formulated for

commercial use, it was a revolution, an innovation
that made it possible to feed the world.
The Tata groups unique ownership structure,
its pioneering endeavours in steelmaking, in the
generation of hydroelectric power, and other such
businesses, were all innovative ideas that were
very unique for the period in which they were
first thought of. This history of innovation found
a contemporary focus in the Tata group about
a decade back, when it was decided to adopt
innovation as a formal initiative.
The inspiration came from Ratan Tata, the
then chairman of the Tata group, who spoke
of the need for innovation at the Business
Excellence Convention 2004: To be leaders,
we need to innovate. We need to bring out the
creative strengths of our people and create an
environment where we do things differently
and do things others have not done.
This became the springboard for a host
of innovative practices in the group, with Tata
companies encouraging employees to feel free
to experiment and dare to take risks. The Tata
Group Innovation Forum was set up in 2007, to
handhold Tata companies on their innovation
journey and to encourage, inspire and help create
a culture of innovation within the group. This was
a huge challenge because just like it is easier to
teach physics and arithmetic than to teach music
or painting, it is much easier to work on processes
and structures than on culture.
The Tata group is largely a left-brain
organisation, full of engineers, MBAs, lawyers,

SPECIAL REPORT

and accountants who are used to a structured

approach to work. We didnt want to get
academic or esoteric about innovation. We
wanted tactical tools.
One of the first steps we took was to
introduce Tata InnoVista, the annual celebration
of innovation within the group, in 2006. The
idea was to encourage and recognise outstanding
innovations, capture as many of them as possible,
and celebrate the successes and the struggles of
the groups innovation endeavours. Every year,
Tata companies from around the world showcase
their innovations at this event and winners are
awarded under three different categories. Our
jury list is like a whos who of India Inc. They ask
searching questions from the participants before
deciding on the awards.
InnoVista is not just about making better
widgets or products. It is a mental process
influencing the overall innovation culture of
the group. The increase in participation from
101 entries from 35 Tata companies in 2006 to
over 1,745 entries from 56 Tata companies in
2014 bears testimony to the growing culture of
innovation and risk-taking within the group.
When I look back at the journey so far and
our many achievements, two stand out. First is
the Dare to try award category of InnoVista,
which recognises sincere and audacious attempts
at innovation that failed to get the desired result.
We keep hearing that it is not Indian
culture to reward failure, but I find the same is
being said in all countries around the world.
We did some research on the subject and found
an academic paper on BMWs experiment
with failures in Regensburg, Germany. An HR
manager at the company devised a contest
which rewarded people who had failed honestly.
The paper categorised various types of failures,
ranging from willful sabotage to inadvertent
mistakes to carelessness. It did what I call a
diagnosis of failures and prescribed the types of
failures that should be encouraged. Inspired by
this example, we created Dare to try. I think it is
quite an unusual and distinctive award.
In 2007, when it was introduced, Dare to
try received a lukewarm response as companies,
especially those in India, were hesitant to share

Number of entries: InnoVista

1,745
1,461
1,184

101

191

2006

2008

2010

2012

2014

Number of entries: Dare to try

174

12

17

2007

2008

85

87

2010

2012

2014

Growing numbers: An indication of the growing culture

of innovation and risk-taking within the Tata group
their failures. But it soon gathered steam with
companies participating from around the world.
The growing number of entries in this category
(from 12 in 2007 to 174 in 2014) indicates that
we have been successful in encouraging people
to experiment and innovate.
The second achievement that stands out
in my mind is the Tata InnoMeterTM, a unique
tool designed in association with Prof Julian
Birkinshaw of the London Business School.
It works like a thermometer to measure the
innovativeness and innovation culture of a team,
business unit, department or a company. The
findings of InnoMeter are holistic. It appeals
to the basic positive competitiveness amongst
people and enables companies to improve their
innovation climate and ecosystem.
When I look back, I am glad that we
started on our formal innovation journey the
right way and chose the culture route. I always
knew it, but it is now confirmed in my mind
that changing culture is not a two- or four-year
programme. It takes a generation or more to
accomplish and our journey still goes on.
As told to Shubha Madhukar


April 2014 

Tata Review

59

SPECIAL REPORT

Innovation needs mavericks

and Everest climbers
Ravi Arora, vice president, Tata Quality Management Services,
has been closely involved with the groups innovation journey
over the past seven years. In this article, he talks about the
various aspects of innovation as practised in group companies

ata Quality Management Services

(TQMS) has been driving innovation
in association with the Tata Group
Innovation Forum (TGIF). We have a
team of four members who help to implement
the forums decisions. Group-wide initiatives and
programmes have been instituted by the team to
serve as triggers to spark innovation.
One of the most popular programmes
initiated across the group is Tata InnoVista,
through which we try to inspire and motivate
young middle-level managers to take up
innovation projects. An amazing platform, it
enables the capturing of new and innovative
developments in the group everything that
people are proud of and want to tell others

Innovation is like yoga; it may not

be necessary for survival, but is
useful for long-time sustainability.
Ravi Arora, vice president, Tata Quality Management
Services


April 2014
60 Tata Review 

about. The information is compiled on the

Tata InnoVista website and is accessible to any
Tata employee desirous of knowing about new
developments happening across the group.
Tata InnoVista begins in November and we
get about 2,000 projects from Tata group
companies across the world. In January, the
online process of selection, which has been
developed by CMC and involves more than 300
senior Tata executives, begins.
By February-March, 200 cases are selected
that are presented across seven places spanning
the US, the UK, Southeast Asia and India. The
winners then come to Mumbai for the final round
and the award ceremony. This year, the Tata
InnoVista award ceremony was held on April 23.
An important step last year was to
encourage rewards and recognition at the
company level, and not only at the group level.
This year, for instance, companies like Jaguar
Land Rover (JLR), CMC and Tata Consultancy
Services conducted internal InnoVista-like
programmes. Both JLR and CMC even call
their programmes Internal InnoVista. They got

SPECIAL REPORT

hundreds of applications and about 10 to 20

percent were selected and sent for Tata InnoVista.
If more Tata companies initiate InnoVistatype processes internally and send the best
ones to the group-level InnoVista, it will inspire
more employees and enable the capture of a
larger number of innovations. Many companies,
including Tata AutoComp Systems and Tata Steel
Europe, are considering the initiation of similar
programmes next year.
Tata InnoVerse, an innovation hub, has been
built on the premise that senior Tata executives
should regularly identify, define and articulate
problems and challenges faced by their company
and engage Tata managers to find innovative
solutions. Tata InnoVerse serves as a platform on
which the problems can potentially be presented
to 540,000 Tata managers.
We also have a sub-programme called
Challenges Worth Solving, which is a highdecibel use of the InnoVerse platform. About a
dozen companies participate in this programme
and we take up one problem per firm, provided
by its CEO/MD. The problem is communicated
through various forums including TataWorld
and tata.com to ensure that the right people
the experienced and the mavericks provide
solutions. We have a Linkedin community
of people who have attempted to crack these
challenges. Tata InnoMeter is a measurement
system to assess the state of innovation in
a company how good is the culture of
innovation and its processes, and how important
and strategic is innovation to the entity.
We also have smaller initiatives such
as the InnoMission, where teams (about
15-20) of senior executives from companies
visit different countries to learn about new
technologies taking root there. We have already
had InnoMissions to the US, the UK, Japan and
Israel. The last one was to Israel about three
years ago. We also invite eminent speakers
the best minds from institutions such as the
Harvard Business School, the London Business
School, the University of California, Los
Angeles, Insead and McKinsey to spend two to
three days with senior managers and share their
knowledge and experience.

INNOVATION YOGA
Innovation is like yoga; it may not appear to be
necessary for survival, but is useful for longtime sustainability. Many companies like
individuals do learn it, but arent able to spend
time practising it.
To make this happen, we constantly try
and engage senior management in innovation
programmes. About five years ago, we used to
spend more time talking about why innovation?
Everybody now knows why it is important.
Even companies in the commodity space are
participating and winning accolades in InnoVista.
Innovation now gets a fair amount of
timeshare and mindshare of the senior leadership
in Tata group companies. In a few companies, it is
discussed in boardrooms.
All group-wide innovation initiatives,
other than InnoVista, require an engaging top
management to ensure rigorous implementation.
They are like coaches who have to be more
disciplined than the teams. Companies that
have demonstrated rigour in giving importance
to innovating, implementing initiatives and
identifying the right resources are reaping
excellent benefits.
INNOVATION ENABLERS
Companies such as JLR and Titan Company
provide good examples of implementing best
practices in innovation. The latter, for instance,
has something called innovation bazaar, an ideas
market place, where employees showcase select
innovations, which triggers new innovations and
collaborations.
Titan also has a programme called
Interweave, an innovation enabler, which
triggers collaborative ideas across four business
units. The company also runs an Innovation
School of Management, where 20 to 25 people
from different units spend a few hours each
week, learning about innovation and finding
solutions to an innovation challenge. Experts and
consultants take classes on ideation, innovation
techniques and tools, mindset changes and
execution. The participants are also taken to
companies within and outside Bengaluru,
which helps trigger new thinking. It is a unique

April 2014 

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61

SPECIAL REPORT

Tata InnoVista: The evolution

2006
Quiet start
2008
Growth
2010


People

Projects

Expanded scope


Categories

Jurors

2012


Companies

Consolidation
2014
5,000+ 1,700+

programme that has been in place for more than

three years.
JLR also has an interesting programme in
which employees are encouraged to come out
with innovative ideas on Tata InnoVerse. Teams
with selected ideas are then given two days to
come out with prototypes. A recent example was
the effective use of boot space for leisure purpose
while the vehicle is parked.
OBSTACLES ON THE PATH
TO INNOVATION
There is no company in the world that has
perfected the art of innovation. Innovation needs
a long-term view. Most companies know how to
work on small improvements and incremental
innovations, but they need to learn the art of
working on long-term, radical innovation, which
may not necessarily impact the quarterly results,
but lead to an accrual of benefits over a longer
term. To make this happen, firms need to find
a way to commit resources to innovate. Most
importantly, they need a brave and objective
method to kill a project.
There are companies which feel that the
market is down, morale is down and it is not the
right time to work on innovation. Then, there
are companies who spend time and resources,
and manage to find funds for innovation even
during bad times. Obviously, the latter spring
up faster during the first showers or signs of

April 2014
62 Tata Review 

300+

70

recovery, whereas the former would need many

more showers to sprout. Programmes like Tata
InnoVista and Tata InnoVerse PLUS have been
designed to help companies maintain the rhythm
of keeping a consistent focus and commitment
towards innovation.
There are small nuggets of knowledge
available within the group which promote
innovation at team level. Titan, for instance,
has a programme in which every functional
head is allocated about `100,000 to fund small
experiments leading to innovations. Once the
funds are exhausted, they are replenished after
they make a presentation to the senior leadership
on how the funds were utilised.
It is important to assign the right resources:
creative maverick people to think
of new ideas; and Everest climbers who would be
willing to take on the journey of completing the
innovation, which is fraught with risks. The Dare
to Try award in InnoVista attempts to spread this
message to climbers and coaches alike. Looking
ahead, I see senior executives across Tata group
companies becoming more confident about
managing the nebulous subject of innovation,
yielding not only incremental innovations but
also radical ones. This is important because the
Tata portfolio in future and the markets it serves
will demand a higher propensity to innovate.
As told to Nithin Rao

SPECIAL REPORT

Innovation@TCS
Underscoring its strong
standing as a world-class IT
company, Tata Consultancy
Services has built a global
network of innovation labs.
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K Ananth Krishnan speaks to
Gayatri Kamath about TCSs
innovation programmes and
how they deliver value
What is the level of investment
that TCS puts into research and
innovation?
TCS has been investing in research for over
three decades now. Our flagship lab was founded
in 1981 as the Tata Research Development and
Design Centre in Pune. We built some of the
earliest toolsets for application development and
support and this helped us deliver large software
projects for prestigious customers globally.
The innovation process itself has gained
maturity with a clear framework that carries
an idea from exploration to a commercial
solution. And, we now have about 2,500 people
in innovation, asset creation, research and
development, across the organisation.
We are also investing in the computer
science ecosystem in the country with a
Research Scholar Programme. We have built a

strong Co-innovation Network (COIN) that

connects to academic research, emerging tech
companies, venture capital firms and strategic
alliance companies, and Tata group companies.
We also encourage our leading business units,
such as insurance, banking and retail, to have
their own innovation units, so that they can
handle innovation in specific domains closer to
the customer.
As for financial investments, we invested
over `7 billion last year on innovation. We have
been consistently investing about 1.5 percent of
our total turnover on research and innovation.
Our patent count has grown exponentially in the
past two years. We have filed for 1,746 patents
and 114 have been granted as of this year.
What kind of innovation is taking
place in the labs?
The research we do is grouped in three broad
areas: software, scientific applications and cyberphysical systems. Each area has several projects
involving emerging technologies.
We have a 4E model for innovation
management. The core research in the labs
comes under the Explore phase. Once we

The innovation process has gained

maturity with a framework that
carries an idea from exploration to
commercial solution.
+!NANTH+RISHNANCHIEFTECHNOLOGYOFCER4#3


April 2014 

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63

SPECIAL REPORT

The Tata Consultancy Services team receiving The Leading

Edge - Proven Technologies award at Tata InnoVista 2014
have tested research concepts and we feel they
are technologically sound and have market
traction, we Enable these ideas by engineering
applications. Those that are most attractive to
our customers and business are then scaled up
by an Exploit team. There is a fourth team, the
Evangelise team, that works as a glue between
the other three Es, taking research to business
and providing market information to research.
How important is it to a business
like TCS to constantly remain on the
technology edge? Can you give us
some examples or anecdotes?
We cater to companies that are leaders in their
industries. To be a trusted partner to such
businesses in the technology domain, we have to
stay ahead of the curve. We also have our internal
culture as pioneers in the software industry, with
leading change as a strong value, and we keep
looking for the next frontier in technology.
We therefore plan for innovation in three
segments or time horizons:
Derivative innovations help us constantly
improve in current services and markets. We
do this through our business units, centres
of excellence and tools from the TCS Tools
group.
Platform innovations look at helping
businesses adapt to changes in the next two
to three years. TCSs sensor cloud platform,
frugal but versatile devices, and our social

April 2014
64 Tata Review 

platforms are just some examples of this kind

of innovation.
Disruptive innovations are long-term
research explorations that can be gamechangers. We are investing in areas
with high potential such as genomics,
metagenomics, integrated computational
materials engineering(ICME), robotics and
automation, and human-centric systems.
There are many live examples of how TCS
helps customers: We helped a leader in wind
energy with an analytics solution for their big
data; a Silicon Valley technology leader has used
our capabilities and co-innovation network for
mobility and user experience solutions; we are
enabling a global retail chain manage its carbon
footprint.
What are the big ticket products and
solutions that have been created
in these labs? What is the revenue
stream from these labs?
Research solutions are regularly released from
the labs to our business units. Let me give you
an example.
A typical global banks infrastructure
is very complex. They would have started
computerisation very early, and IT
infrastructure would have grown with their
needs and become very complex.
Even their IT managers do not know
how many servers are underperforming, how
many duplicate instances of OS/applications
exist, and so on. The tools to understand these
are primitive and rely largely on IT managers
memory and judgment. Our systems research
labs in Pune built a data-driven framework to
understand this complexity. This puts probes in
the IT plant and uses sophisticated algorithms to
understand the working of a complex IT set-up.
Once we have granular visibility of the system,
we pare down redundancies and low performers
and reduce complexity. This framework
has enabled our IT unit to increase revenue
considerably.
We also incubated a new suite of digital
marketing solutions that provides a whole set of
strategic and consulting services, such as user

SPECIAL REPORT

experience, design, social media consulting,

enterprise marketing management, etc. This
service line has enabled TCS to acquire new
customers and to expand its footprint in
existing established relationships. It also helped
establish our thought leadership in the area.
What, in your opinion, are the key
factors that can spark innovation
and ideation in the workplace,
outside of the innovation labs?
Both the input and output mechanism
for innovation must be well oiled to spark
innovation. Clear articulation of customer
problems is the input that is essential. Quite
often we lose the capability to understand the
customers pain point or his latent need. A
culture of creative dissatisfaction with the status
quo is critical to spark innovation. Associates
must feel that continuous improvements are
possible and that they can contribute to this
improvement.
Our customers too understand this spirit
and help foster it. Recently we had a hackathon
for an anchor customer. The customer had put
up prize money of US$25,000 and some gifts for
winners. Nearly 4,000 TCSers around the world
participated and nearly 300 applications were
submitted for review.
Sometimes peer recognition can be a
greater motivator than a cash award. Inviting
everyone to participate in solving challenges,
openness to receiving ideas from all,
transparency in response to ideas these are
triggers for people to think innovatively and
engage in solving problems in new ways. The
TCS social platform Knome allows the entire
enterprise to participate in conversations. For
instance:
For the live chat with the CEO, 76,000
people logged in from 60 TCS locations; 700
questions were asked.
Over 50 senior management chats have
happened, and over 10,000 comments have
been directed at leaders.
Over 1,000 ideas were generated for 42
focused challenges in two months.
So, the right environment created by the

leadership encourages creativity and problem

solving.
What does TCS do to encourage
innovation and innovators? Are there
any specific schemes, initiatives or
processes for this?
We provide an intellectually stimulating
environment with mentorship by senior
researchers of repute. We have a 4E innovation
framework where research progresses in a
streamlined fashion from idea to offering. We
have annual awards for researchers as well as
engineers in the innovation labs. We encourage
collaboration with academia and other
research bodies. We mandate tier 1 conference
attendance for executives for greater exchange
of ideas. There is a separate cell to support
researchers in patent filing.
Our researchers have a distinct career path.
We encourage role rotation for associates from
core research to research-related engineering,
sales or co-innovation. They can also move to
business unit innovation teams. We also give
them freedom from constraints. Researchers are
not given revenue targets, but are encouraged
to do what they are best at: explore new
technologies, write papers, file patents. They
do not have to make sales pitches or worry
about go-to-market strategies. There is a team
that helps them with market inputs, forging
solutions with delivery units, providing pricing
models, etc.
What role can pan-Tata forums
like TGIF or TQMS play in bringing
innovative products or ideas to the
market?
They are already playing a significant role by
enabling:
Collaboration (Tata Swach is a case in point).
Crowd sourcing for ideas, especially through
the Challenges Worth Solving initiative.
Sharing of best practices.
Adoption of good initiatives Tata
Innoverse, ECView.
Recognition through awards such as
InnoVista.

April 2014 

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65

SPECIAL REPORT

Driving innovation
Karl Koehler, chief executive of Tata Steel Europe, explains
how the company uses innovation as a means to partner with
customers to help them address their challenges

nnovation matters to industries that operate

in mature markets such as the European
steel industry because its a key tool for
growth. Discerning customers have evolved
to become the key drivers of innovation in
global steel markets. Suppliers who know their
customers businesses and markets intimately
stand to gain because customers are keen to
form profitable, long-term partnerships in their
efforts to taste success in their chosen markets.
Tata Steels endeavours in the field of
innovation and R&D are framed within the
context of customer needs. The companys
market strategy in Europe is targeted at
providing customers with differentiated
offerings, which translate into products and
services that few others sometimes no others
provide. This necessitated a redesigning of the
companys operating model. We believe the new
model is unique in the steel industry a true
differentiator. We created market sector teams

Tata Steels endeavours in the

field of innovation and R&D are
framed within the context of
customer needs.
Karl Koehler, chief executive, Tata Steel Europe


April 2014
66 Tata Review 

catering to customers in specific markets. They

work closely with customers in their sectors to
understand their needs, which then direct the
delivery, production and supply chain activities.
PIPELINE TO INNOVATION
To drive innovation through product and supply
chains, the marketing function established a new
product development (NPD) pipeline in 2011
to capture ideas and funnel the best through
to commercialisation. An award-winning
adaptation of a management software tool has
been put to task for this particular purpose.
The NPD pipelines success can be measured
by the increase in new products and services in
the companys portfolio. Tata Steel launched 30
new products and services in the financial year
that has just ended the highest number since
the start of the programme. Another statistic that
points to the pipelines success is that the volume
of new products and services sold last year rose
by around 80 percent.
A major addition to new products launched
last year was the new grade of heat-treatable,
case-hardening steel, C15E. Building on
decades of steel know-how, Tata Steel has been
developing high-quality, complex steels of this
type after significant investment in production
processes and controls. The steel has excellent

SPECIAL REPORT

formability and good punchability making it

perfect for wear-resistant parts that withstand
extreme fatigue stress in demanding applications.
It also offers customers reliability and consistent
quality.
Innovation has a major role to play in the
development of new systems and products.
A pertinent example would be the new
photovoltaic ground-mounting systems launched
last year an essential component in solar
power generation modules. The systems can
be built to order, based on individual customer
needs. An innovative aspect of the system is that
it reduces material consumption by reducing the
number of piles needed for installation.
CONSORTIUMS FOR INNOVATION
Another important driver of innovation is
the R&D function, which supports the NPD
pipeline. Its activities are aligned with the
companys customer-focused strategy. Besides
the NPD programme, R&D has developed its
own programme, Thrust, to boost work on
projects based on new ideas and concepts. Tata
Steel works with a consortium of customers,
industrial partners and academia on these
projects the company provides R&D
resources and sample material.The automotive
Thrust team, for example, is collaboratively
working on a project to develop low-carbon
vehicle technologies. Collaboration with
customers on a project increases its chances of
commercial success.
The companys R&D activities focus on the
whole range of iron and steelmaking operations,
from raw materials to finished products. The
focus also extends to customers own processes.
Last year, for example, Tata Steel opened a new
hot press forming plant at IJmuiden in the
Netherlands to serve the companys automotive
customers by developing crash-resistant steels to
make vehicles safer and more fuel-efficient. Tata
Steel supports the development of breakthrough
technologies to deal with the challenge of
climate change as a founding member of
the Ultra Low CO2 Steelmaking (ULCOS)
consortium of European steel producers.
HIsarna is a new ironmaking technology

that the ULCOS partners regard as having the

best prospects to succeed. A combination of
Rio Tintos HIsmelt process and the Isarna (an
old Celtic word for iron) process developed
at IJmuiden, HIsarna has the potential to
reduce carbon emissions from the ironmaking
process by around 20 percent. The 60,000
tonne per annum HIsarna pilot plant is due
to start a fourth trial production campaign at
IJmuiden in May to test production runs and
trial different raw material blends. The HIsarna
plants development has been partly funded
by the European Commission and the Dutch
government.
PROVING INNOVATION
Tata Steels R&D function is also the main
anchor behind another customer-oriented
initiative that is taking shape, The Proving
Factory, through which Tata Steel is working
with a number of partners to help bring to
market groundbreaking green technologies
which will power the cars of the future.
The Proving Factory will act as a bridge
between green technology prototypes and
high-volume production. It will prove the
viability of low-carbon vehicle technologies
designed by small, high-tech British companies
and university research departments in
production, increasing their chances of being
adopted by major motor manufacturers. Once
completed, The Proving Factory will identify
advanced technologies for vehicle makers and
carry out trials with a target of manufacturing
between 1,000-20,000 product units a year
using any one technology and between 10-20
different types of products.
In a globally competitive sector such
as steel, policy makers and industry must
work together to deliver the right operating
and investment conditions to stimulate
technological breakthroughs. Steel has
underpinned the development of modern
civilisation. The current generation of industry
leaders have the responsibility to realise
steels full potential as a material. We, at Tata
Steel, will continue to focus on innovation to
profitably grow with our customers.

April 2014 

Tata Review

67

IN CONVERSATION

India must brand its natural

and cultural resources
With his concise and straightforward

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taught at Northwestern University,

his formidable academic and business

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Business School and at the IMD-

from Calcutta University was the

International Institute for Management

beginning of an exceptional academic

Development in Lausanne, Switzerland,

career that saw Dr Kumar complete

while also advising a host of global

his masters in business administration

corporations. Dr Kumar, who joined the

from the University of Illinois before

Tatas in August 2013 as a member of

getting a PhD in marketing from the

the Group Executive Council, opens

Kellogg School of Management. He

up in this interview with Christabelle

then embarked on a journey that

Noronha on his role in the group, the

made him one of the worlds foremost

Indian business environment and on

thinkers on strategy and marketing.

living and working in India.


April 2014
68 Tata Review 

IN CONVERSATION

You have been an academic all

your life and have many stellar
achievements to your credit in
that field. What made you leave
academia and join the world of
business?
I have spent most of my working years in
academia and I continue to define myself as
an academic, but I felt that I had achieved all
the goals I had set for myself. Also, I wanted to
come back to India. Here the kind of academics
I am into does not exist, except at the Indian
School of Business and I did not want to live in
Hyderabad. When the opportunity to join Tata
arose, I realised that this was a great chance to
serve a group that has played a critical role in
the development of India. It was an attractive
proposition. Some other group or job and I
would probably have said no.
You have spent about seven months
with the group. What has the
experience been like thus far?
What I find truly exciting is that since it is
a diversified group there are always new
challenges. As an academician I took up
consulting assignments for several companies;
I find myself playing the same role here in
the group. My job is to help companies find
innovative solutions to their problems. So
far I have worked with Tata Chemicals, Tata
Global Beverages and Tata Industries. I see
my job not so much about solving problems
as about increasing the imagination quotient
of the solutions.
Imagination means innovation and
research and development. What is
your opinion about the investments
that have been made in R&D by the
Tata group?
At the Tata group, we are going to compete
increasingly in a future where innovation
is a critical driver for creating differentiated
products and services. If innovation is going
to be the source of our competitive advantage,
its vital to have a good technology profile and
sound investments in R&D. However, this is not

going to happen overnight. Being world-class in

research, innovation and customer centricity are
not destinations; they are journeys.
In R&D, what does India need to
do to catch up with the rest of the
world?
Compared with the rest of the world, India
is investing too little in R&D. In the United
States they invest 3 percent of their GDP in
R&D, in China it is 2 percent; in India it is only
0.6 percent. Corporate GDP is much lower and,
therefore, a more substantial investment in
R&D is important. Chinas example shows that
we as a country can certainly do much more.
You need commitment, not only from corporate
entities but also from the government.
Consider the United States and Israel: both are
good at technology and innovation because
a large part of the investment in R&D comes
from the defence sector and, hence, from the
defence budget.
Would a group like Tata, with
multiple businesses and a presence
in many industries, benefit from
having a chief technology officer
(CTO)?
Most certainly. In a scenario such as ours, the
role of the CTO is not going to be to suggest
which technology to adopt, but to give advice
on how to manage technology: processes,
structures and systems. Companies can choose
to go with different technology platforms
depending on their need. The CTO can offer
guidance on what should be an outcome of that
process as well as be a technology sniffer.
In one of your recent interviews,
you made a distinction between
concepts of the past, such as the
made in China label, and of the
future, when China will be defined
by the owned by China label.
Could you elaborate on this?
In the past 20-30 years, the made in China
label has become ubiquitous because China
is the manufacturing capital of the world.

April 2014 

Tata Review

69

IN CONVERSATION

Now the Chinese government has mandated

that sources of natural resources should be
secured, which explains why the Chinese have
bought up large tracts of land in countries like
Australia, Africa and New Zealand. A lot of
the consumption in the world today is being
driven by China, which is the largest consumer
of resources and products. Large companies
like Starbucks, hospitality chains like Starwood
Hotels, luxury motor car companies like BMW
and Jaguar Land Rover, shipping companies
they all say that China is the market.
Even Africa is booming, because China is
consuming its raw material and resources.
So the world is going from a made in China
phase to a made for China phase. This trend
will eventually lead to owned by China.
In your book Brand Breakout, you
have advocated eight routes that
emerging market brands need
to take to establish themselves
globally. Which routes do you think
could catapult Indian brands to the
international stage?
Three routes are particularly relevant for
Indian brands. The first is branding natural
resources. India has a huge amount of natural
resources, but we have never branded them
the way the French and Italians have branded
champagne and Parma ham, for example.
These are good examples of branding products
based on the geographic location of that
product. We have Darjeeling tea, South Indian
coffee, red cinnamon and other spices, but
we have not used active branding for these.
The way to do that is to begin by defining
the region tightly. You then create a myth
around that region about its special qualities.
The French are good at creating these myths.
Another example is Premier Cosmetics from
Israel, which says its salt comes from the
Dead Sea, from where Cleopatra obtained her
beauty secrets. India has many products where
branding of natural resources will work. The
government can play a big role here.
The second is the cultural resources route. India

April 2014
70 Tata Review 

is a country full of rich cultural myths. Dabur

is using this to market its natural ayurvedic
products. Taj Hotels can similarly use the land
of the maharajas and palaces theme. These are
cultural icons of India and we can do a much
better job of tapping into and marketing them.
The third route is to use the ethnic diaspora.
ICICI Bank has taken this route successfully to
enter foreign markets, where it is expensive to
advertise. If you can find a diaspora on which
to build the initial set of sales, you can use these
resources to spread across the country. India has
the largest global diaspora after the Chinese.
Would you agree with (Googles
executive chairman) Eric Schmidt,
who recently said that Indias
entrepreneurial innovators have
the potential to build the next
Google?
In a way, yes. Young Indians are being
increasingly exposed to the global economy and
many of them want to build new companies.
Sooner or later, one of them is going to crack
the code: if not the next Google, then the next
Whatsapp.
Do Indian and other emerging
market brands need to invest
more in building their global
image, especially among western
consumers?
I dont think there is a need to build our image
among western consumers because that is
tremendously expensive. Unless you have a
good rationale for this strategy, I would advise
against it. Thats why most of the big global
companies coming out of emerging markets are
business-to-business, rather than business-toconsumer, enterprises.
What changes would you
recommend in government policies
in India to help Indian companies
expand overseas?
In my opinion, one obstacle to Indian
companies expanding overseas is the

IN CONVERSATION

infrastructure. If we are exporting out of India

and shipping is more expensive than exporting
out of China, then we are at a competitive
disadvantage. If registering a company here
takes longer than in any other country, or if
the number of laws we have to tick the box
against is longer, then it raises the cost of doing
business. There is also the need to simplify
business regulations and make the process more
transparent and less costly to comply with, so
that companies can become more competitive.
In any global survey on the ease of doing
business, India is never in the top-100 list.
Staying on the straight and narrow
in business dealings seems to be
near impossible in this country.
Where does that leave companies
and businesses in India that want
to do the right thing but find
themselves severely compromised if
they do?
It is difficult, challenging and frustrating at
times to conduct business dealings in India
but not impossible. At Tata, honesty and
transparency are integral to the way we do
business and this is our key differentiator. If we
lose that we will become like any other Indian
business group. We will be envied by some and
feared by a few, but we will not be respected
and admired by anyone. Maintaining our
values in all circumstances is important for the
leadership, especially given our 140-year-old
legacy. Does that add to our challenges? Yes,
but it also gives us many advantages. Every day
we have foreign companies knocking at our
doors, wanting to do business or partner us.
Our reputation gets us business. We also attract
some of the best talent out there.
Coming to the development
model India has been pursuing,
is there merit in rethinking how
this country has gone about the
business part of development? How
can development be made more
inclusive?
Development has to be inclusive, so that as

When the opportunity to join Tata arose,

I realised that this was a great chance to
serve a group that has played a critical role
in the development of India.
our economy grows, our people move out of
poverty. We have seen that in the last 20 years,
when the country was growing fast, more
people moved out of poverty than when the
country was growing slowly. Inclusiveness is
different from inequality.
Inequality can also increase because
of economic growth and in the last 20 years
inequality has gone up. But the fact is that more
people have moved out of poverty in this time
than ever before in the history of India. Growth
is not a bad development model, though one
always hopes for more equity in distribution.
You have worked outside India for
most of your career. How different
is it to live and work in India?
The biggest change that hits you is the long
working hours in India; people abroad rarely
work on weekends, or stay in office very late.
Then there is the lack of multicultural diversity
in India. I have worked in cities such as
Chicago, Boston, Lausanne and London, where
you always run into people from different
cultures and countries. Another difference is
that in India we dont have as many women in
the workplace.
In my earlier jobs, my calendar used to be full
for 12 months and the amount of flexibility
was limited. Now its empty beyond two weeks,
because people dont plan meetings till the last
minute. This is a big change to get used to.
What about life in India beyond work?
I miss the art world of London, but Mumbai
is an exciting city. If you have interests in art,
theatre, fashion, movies and food, you can try
to create some of the same world in Mumbai as
in any other city on earth.

April 2014 

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71

COMMUNITY

Empowering migrants
Ignored by lawmakers, harassed by law-enforcers
and viewed with suspicion by law-abiding citizens,
migrant workers and their families live on the fringes
of society in urban areas. Aajeevika Bureau and
Prayas, supported by the Sir Dorabji Tata Trust
and Allied Trusts, are part of a group of NGOs that
provide support and an identity for migrants

rom roads to high-rise

towers in Indias cities and
towns, a large part of urban
construction is the result of
the sweat and labour of migrant
workers. These nomadic workers are
mostly landless labourers or small
farmers affected by shrinking land
holdings, the vagaries of climate and
decreasing yield per hectare, which
make agriculture a fruitless exercise.
Dreaming of better living
conditions and financial security,
many look for subsistence in concrete


April 2014
72 Tata Review 

jungles far from their rural homes.

However, dreams of a rosy utopia are
razed to the ground as they come face
to face with exploitation by labour
contractors and employers, and poor
working and living conditions, with
women suffering the added indignity
of physical and sexual abuse.
A HUMANE VIEW
In 2006, Sir Dorabji Tata Trust
and the Allied Trusts (the Trusts)
identified urban poverty as an area of
focus as part of a strategic planning

exercise, and migrants as a vulnerable

occupational group in urban spaces.
There were hardly any models,
organisations, donors or defining
agenda to represent the group.
Constitutionally migrant workers are
citizens. We have to make provision
for them, says Nayantara Sabavala,
deputy programme director, Urban
Poverty and Livelihoods at the Trusts.
The problem is that they are not
a tangible community. They dont
have any recourse if an employer is
exploiting them.
The Trusts next set about
identifying organisations to partner
and support, and Aajeevika Bureau
and Prayas, pioneering organisations
in the field of migration, met their
requirements. The two-member
family has since grown to a robust
partner network of 34 organisations,
working across Rajasthan, Gujarat,
Uttar Pradesh and Odisha. The
models experimented with by the
Trust partners and the lessons

COMMUNITY

learnt are an invaluable resource

that can shape the corporate social
responsibility policies of companies
to fulfil their employability and
livelihoods agenda, and help bring
down Indias unemployment rates.
As Sugandhi Baliga, senior
programme officer at the Trusts for
Urban Poverty and Livelihoods,
explains, Migration is a reality that
could not be wished away. There was
a lot of introspection at the Trusts
since we have always believed in rural
development, including livelihood
and natural resource management.
There was an eventual realisation that
the changing economy will lead to
migration and it is important to focus
on migration explicitly.
HELPING HANDS
Aajeevika Bureau and Prayas, which
operate in Rajasthan and Gujarat,
were born of a United Nations
Development Programme study on
migration. The consultants became
so enamoured of the issue that
they set up the organisations. Both
cater to the same target population,
but their modes of operation are
different though one has imbibed
learnings from the other.
Aajeevika looks at a service
delivery model, with centres that
provide a bouquet of services. The
centres are based at the source
(the village) and at the destination
(the city or town). They provide
registration services, identity cards,
skill training, legal support, access to
health care, family support services
and financial and government
linkages. Aajeevika has also looked
at how to dovetail its services with
the central governments Mahatma
Gandhi National Rural Employment
Guarantee Act so that migrants
benefit from both.

Prayas provides migrants with

a voice. It mobilises them to come
together as one to fight for their
rights. It works to form collectives

of brick kiln workers, BT cotton

workers, ice cream vendors and
construction workers and negotiates
with employers to improve wages

Justice delivered

A legal clinic in progress at a migration resource centre

A group of six migrant labourers (two females and four males)
working in a three-star hotel in Navi Mumbai were denied
wages of over a month after toiling hard as housekeepers and
security guards. The unpaid amount due to them was about
`32,600. The migration resource centre (MRC) at the Youth
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their cause. It decided to go ahead with legal action when the
labour contractor and the hotel blamed each other and refused
to pay up.
A legal notice for non-payment of wages was issued
against the hotel and agency by the assistant labour
BNLLHRRHNMDQlRNEBDHM/@MUDK -NNMDRGNVDCTOEQNLSGD
agency. Hotel representatives present informed the court that
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personnel that the Contract Labour (Regulation and Abolition)
Act, 1970, stipulates that if a contractor fails to pay the wages
of a hired worker then the principal employer in this case
the hotel was responsible for the payment. The hotel
representatives agreed to convince the agency to clear dues.
At the next hearing, hotel personnel informed the court
that the agency had not responded to their attempts to
resolve the issue and assured the court that they would
O@X SSGDENTQSG@MCM@KGD@QHMFGNSDKQDOQDRDMS@SHUDR
informed the court that unpaid wages of `32,600 had been
paid to the labourers.


April 2014 

Tata Review

73

COMMUNITY

and enable insurance and legal claim

settlements. Over `20 million worth
of legal claims as well as insurance
claims worth a fair amount have
been settled through these centres.
Primarily working at the
destination end, it has fellows for
coordination at the source end.
Fellowship, in the form of money
and resources, is offered to bright,
enthusiastic youth who are keen
to work for migrant welfare. The
fellows build strong networks with
the migrating villagers and form
connections with the community at
the destination.
OASES OF SUPPORT
The support that Aajeevika, Prayas
and partner organisations provide
have proved invaluable to migrants
who land up bewildered and helpless
in cities and towns. Unique identity
cards, provided after registration
at the centres, have helped them
walk out free when picked up by
policemen in trains or after a robbery
in the locality. Theres a toll-free
labour helpline (with its tag line Daro
math phone karo or fear not, make a
phone call) which has proved to be a
lifeline for migrants when they face
harassment, do not receive payments
on time or if they have a work-related

accident and the employer shies away

from responsibility. The organisations
mediate with the employer to sort out
the issue. Migrants bonded in chains
of slave labour have been rescued
through partner networks after calls
to the helpline. Whether it is helping
out with KYC (know your customer)
norms to open a bank account or
documentation for securing an
Aadhaar or ration card, the centres
stand ready to help.
A fair amount of cross-learning
has happened as more organisations
have joined the fold of the Trusts
support. Although the mobilisation
route of Prayas and the service
delivery mode of Aajeevika have been
the two main models of operation,
many partner organisations have
tailored the modes to suit geography
and requirements. So an organisation
may provide a service where a teacher
travels with a migrant group and
teaches the children in their native
tongue. When the group is back in
time for harvest or agricultural work,
the children are able to appear for
exams and dont miss out on school.
Another may provide seasonal hostels
for migrating children. Yet another
may use puppets and theatre to tell
a story of the travails of migrants
and in the process create awareness

A group of successful trainees with their skills training certificates


April 2014
74 Tata Review 

about the facilities it provides.

Each organisation ensures that it is
reaching out to migrants and catering
to a need under the broad umbrella
of support outlined by the Trusts.
PAVING NEW PATHS
The Trusts intend to reach out
to 300,000 migrants through 60
source and destination level centres.
Innovative strategies, proposals and
approaches promise a bright future
for the Trusts interventions for the
welfare of migrants.
An initiative in which the Trusts
are collaborating with academic
institutions and think tanks is
Strengthen and Harmonize Research
and Action on Migration in the
Indian Context. An online portal
(www.shram.org) has been created
as a knowledge community related
to migration in South Asia, with a
specific focus on India. A repository
of information, research studies,
data, news clippings and articles, it
gives non-volunteers a glimpse into
the world of migrants and migrant
welfare activities. Members relate
experiences on the field in the
blog space of the portal a wage
negotiation settled in favour of
labourers, accident compensation
provided, and other such stories.
A Centre for Migration and
Labour Solutions has been set up
with Aajeevika to act as the technical
support unit to partners. A core team
provides orientation and conducts
technical support visits to new
centres. Workshops on providing
legal support and skills training,
financial inclusion, etc are held
to share knowledge. A half-yearly
newsletter on the latest developments
helps disseminate information.
Utilising the booming mobile
industry to enhance connectivity

COMMUNITY

with migrants through their

phone records at the centres is an
innovative idea in the pipeline the
idea is to partner with a telecom
service provider for a system to send
alerts to migrants about centres
close to where they are.
Another interesting proposal is
universal portability of rights the
building of an institutional structure
to provide access to health care,
education, identity cards, voting
rights, etc, in whichever part of
the country a migrant relocates to.
Mapping of occupational streams
(Prayas created a wage labour atlas,
so that health workers become
aware of brick kiln locations and
can cover them), provision of
community kitchens and linkages
with government services are also
part of the future.
The Trusts partnership with
UNESCO, and the UN-Habitat
in particular, resulted in joint
publications such as Social Inclusion
of Internal Migrants in India and
For a Better Inclusion of Internal
Migrants in India. The documents
are not so much an articulation
of the problem as about solutions.
They are expected to serve as
handbooks or policy briefs for
corporations and governments
in dealing with migrants in a
positive way.
Says Poornima Dore,
programme officer, Urban
Poverty and Livelihoods, As the
Trusts work on improving the
employability of 300,000 migrant
workers by establishing over 60
source and destination level centres,
we welcome corporates to join us as
observers or in any other role in this
exciting journey.

Home, safe and sound

Labourers go about a typical workday at a cement brick kiln

Narendra Banchhor of Bagmuda village in Odisha state
migrated with his family members to work in a brick kiln
in Ahmednagar in Maharashtra in October 2010. With an
advance payment of `30,000 and assurance of more to come,
they started work. Working conditions were inhuman. Two
more Bagmuda villagers joined him. On completion of the
contract. the employer refused to pay the remaining amount.
Mr Banchhor, his family and the other villagers were detained
forcibly. They were not allowed out of the brick kiln premises
and forced to work on the owners agricultural land.
On June 26, 2013, Mr Banchhor got an opportunity to call
his cousin Gajendra Matari and tell him about his miserable
condition. Fortunately, Mr Matari was aware of the migration
QDRNTQBDBDMSQD,1"QTMAX/@QC@@S-T@O@C@ 3GD/@QC@
MRC team contacted the victims. Since the incident took place
at the destination end, the MRC team (which was at the source)
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Mr Sudhakar of Sankalp (a voluntary organisation working
on the issue of migration at the destination) was contacted
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briefed about the detained migrants. Sankalp lodged an FIR in
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(including three child labourers) from the employers farmland.
The rescued migrants reached home safely.
3GDCHRSQHBS@CLHMHRSQ@SHNM@RRTQDCM@MBH@KGDKOGNTRHMF
and food for the rescued villagers. Subsequently, the MRC team
admitted the children to school and arranged for alternative
livelihoods for the adults with the help of the forest department,
thus enabling complete rehabilitation of the migrants.

Shalini Menon


April 2014 

Tata Review

75

COMMUNITY

A rich volunteering
tradition
About 25,000 employees from Tata companies
signed up to be part of Tata Engage, the groups
volunteering programme, on the occasion of the
175th birth anniversary of the Founder, Jamsetji Tata

he fact that the Tata group

has a rich volunteering
tradition was brought to
light when nearly 25,000
employees from Tata companies
across the world signed up to be
a part of Tata Engage, the groups
volunteering programme, which
was launched on the occasion of the
175th birth anniversary of Jamsetji
Tata, the Founder of the group.
The success of the weeklong drive indicated that while
volunteering was a first-time
experience for many, by itself it is by
no means a new experience for the
group. There are many companies
that have a rich volunteering
tradition. These include, among
others, Tata Consultancy Services
(TCS), Tata Chemicals and The
Indian Hotels Company (IHCL).


April 2014
76 Tata Review 

COMMITMENT TO
COMMUNITY
Employees of the Taj have always
worked for the benefit of the
community. Vasant Ayyappan,
director of corporate sustainability,
IHCL, says: At the Taj, our
commitment to the community
has been part of our DNA. Our
employees have been actively
volunteering for over 20 years. More
than 10,000 volunteers have spent
over 100,000 hours engaging in
various volunteer initiatives.
TCS has approximately 20,000
registered volunteers across the
globe, working under the guidance
of Maitree. These volunteers are
involved in activities in areas
spanning education, health,
environment, and the economic
empowerment of women and

of rural communities and the

differently-abled.
Specifically, volunteers are
engaged in teaching conversational
English skills, offering maths and
science education, and working
towards computer literacy and adult
literacy, besides organising health
camps and creating awareness on
health-related issues. They also
organise water conservation projects,
tree plantation and adoption drives,
beach and fort cleanups, paper
recycling programmes, etc. TCSs
core competency is also employed in
organising computer training for the
visually impaired and in developing
and maintaining IT-based systems for
Maitrees initiatives.
Employees of Tata Chemicals
have always believed in setting aside
time to make things better for the
community. Volunteers put in 17,128
man hours in volunteering activities
across all its locations in 2012-13.
Volunteering at Tata Chemicals,
managed under a programme
called Harnessing Opportunities
for Peoples Empowerment, is an
intrinsic part of the culture of the

COMMUNITY

company, with volunteers spanning

the organisational hierarchy and
ranging from senior management to
contract employees. Family members
of the employees also take time out
to volunteer in many of the activities.
Their efforts are recognised and
rewarded by the company.
VARIED EFFORTS
The companys regular volunteering
programmes include Arohan, a
childrens festival consisting of
a number of sports and cultural
competitions organised for children
of nine schools in Haldia in West
Bengal, India, eco clubs and eco
fairs held to create awareness about
local biodiversity, summer camp
and coaching classes to help school
children to improve their English
language skills and to ensure
personality development, science
workshops, special coaching classes
to prepare students for entrance
exams, cultural programmes, and eye
camps and blood donation drives.
Most volunteering programmes
thrive on the strength of a basic
structure that helps monitor the
activities and ensure that the purpose
behind them is being served. Nina
Screwvalla, global head, TCS
Maitree, says: We do not mandate
any minimum number of hours of
commitment on a monthly basis. But
most of our activities generally take
up about two hours per visit.
She adds, Volunteers also have
the option of offline volunteering,
which involves preparing schedule /
syllabus, checking papers, calculating
customer satisfaction index etc.
While the activities themselves
are driven by volunteers, the
organisation offers infrastructural
and operational support under
the framework of TCS Maitree.

Volunteers from Tata Communications clean a beach in Hyderabad

Tata Swach water filters being distributed by Tata Chemicals employees

TCS volunteers at a summer camp at Sadhashraya School, Bengaluru

Tata employees undertake a tree plantation drive


April 2014 

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77

COMMUNITY

From left: Tata Africa Holdings (Kenya) employees visit St Bernards Home in Langata; volunteers from Tata Sons and
NatSteel Xiamen donated books and set up a library at Kulong Elementary School in Fujian Province
Associates who are registered
as volunteers are given the right
orientation to match their skills as
per the initiatives. Specially designed
volunteer training programmes are
conducted to guide volunteers.
IHCL does not mandate a
minimum number of hours either.
Mr Ayyappan says: Employees
are encouraged to volunteer for a
minimum of five hours a month.
While we do not have dedicated
budgets for volunteering, we assist
hotel management teams in setting
up NGO partnerships. The corporate
team provides overall guidance to
programmes run at hotels. We are
also constantly available for any
support and assistance required.
AWARENESS PROGRAMMES
Tremendous efforts are made to
encourage employees to sign up as
volunteers. TCS conducts numerous
awareness programmes to encourage
associates to donate their time and
skills for various initiatives. Explains
Ms Screwvalla: We organise road
shows and visits by beneficiaries to
encourage volunteer participation.
Regular registration drives are
conducted besides an annual
volunteers campaign. We also share
various learnings from our volunteers
with our wider employee base.
Reward and recognition programmes
also help to encourage volunteers.

April 2014
78 Tata Review 

The IHCL volunteering

programme has the backing of
the MD and CEO of the company.
Hotel management reviews,
conducted by the respective
COOs, always include updates
on volunteering as part of their
presentations, adds Mr Ayyappan.
Regular volunteering campaigns and
contests also help to drive registration
numbers. We are in the midst of
instituting a volunteering policy to
help drive volunteering at a wider
level. Volunteering is also recognised
at the companys Taj Annual
Business Excellence award ceremony.
Individual hotels also recognise
volunteers for outstanding work.
Companies take volunteering
efforts seriously, mapping the
experiences and lessons learned in
order to make steady improvements
in their endeavours. Ms Screwvalla
says: We organise volunteering
activities as per the guidelines laid
down by TCS Maitree. At the end of
the activity, we conduct a baseline
study and routine tests to check the
progress made and the impact of our
volunteering efforts. We also discuss
the lessons that we have learned to
make sure that we have addressed
the need of the beneficiaries. At
regular intervals, we seek 360-degree
feedback from our stakeholders.
Similar efforts are made by
IHCL. Mr Ayyappan says: Our

activities span a range of needs.

We provide capacity building and
entrepreneurship support, conduct
donation drives and support child
development through education. We
also work to empower local youth
and make them employable through
skill enhancement programmes.
In addition, IHCL supports rural
communities in a number of ways
and sources products required for
the functioning of the hotels through
self-help groups, etc.
At the close of every activity,
hotels update details about the
activity conducted on the companys
annual community initiatives tracker
which is evaluated on a yearly
basis. This helps IHCL to become
aware of the results achieved by
its programmes. The activities are
carefully monitored by a Give Back
Committee, whose members are
appointed from among employees of
each hotel.
Volunteerism works precisely
because volunteers work hard
without expecting any compensation.
Their only hope is that they might
be able to empower and develop the
community whose cause appeals
to them. The company benefits
from the goodwill generated by the
interactions, while the volunteer is
enriched by the experience.
Cynthia Rodrigues

PHOTOFEATURE

MADE FOR ROYALTY

Opulence and luxury that takes your breath away, and a warmth that cocoons you in its
embrace. Presenting the Tata Suites, a tribute to Tata group Founder Jamsetji Tata, and
KLVORYHIRUWKHQHUWKLQJVLQOLIH
Inspired by the Founders vision, the Tata Suites there are only eight to be found in
7DMSURSHUWLHVDURXQGWKHZRUOGUHHFWYDVWQHVVZLWKFORVHQHVVYDVWVSDFHVZKHUH
close attention is given to the smallest detail). They offer guests a taste of the royal
lifestyle that was once the sole preserve of kings.
In the following pages, Sujata Agrawal takes you through some of the Tata Suites around
the world, each a statement in itself.


April 2014 

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79

PHOTOFEATURE
TAJ MAHAL PALACE, MUMBAI

7KHUVWHYHU7DWD6XLWHUHVLGHV
LQ0XPEDLVUVWOX[XU\KRWHO
:LWKYHWKRXVDQGVTXDUHIHHW
RIDZHLQVSLULQJURRPVEHWWLQJ
WKHPDJQLFHQFHRIWKHKLVWRULF
building, the Tata Suite at the
108-year-old Tata Mahal Palace
encapsulates history, legend and
romance.
Luxury is carved into every corner
teak panel doors, furniture
clad in sterling silver metal
plate, hand carved sandalwood
pieces. Spacious bedrooms, a
private study room with a sit-out
overlooking the Gateway of India
and the busy Mumbai harbour,
an in-suite spa by Jiva, a private
conference room...

TAJ PALACE, NEW DELHI

2QO\WKHQHVWHOHPHQWVJUDFH
the 7,500 square feet Tata Suite
at Taj Palace, New Delhi. The
suite has an aura of splendid
well-being which encourages
guests to feel that the universe is
indeed in harmony.
The lavish interiors are a union
of rich Mughal ornament and
pattern with elegant, modern
silhouettes and details, creating
an exceptionally indulgent and
luxurious residential experience.
Exquisite Hadji Jalili carpets,
delicate Murano chandeliers
and masterpieces by MF Husain
create the perfect balance of east
and west for the global traveller.


April 2014
80 Tata Review 

PHOTOFEATURE

TAJ WEST END, BENGALURU

The Presidential Villa is the crown jewel of the heritage property. Lavishly spread over
3,500 square feet, the suite has primarily Victorian and gothic architecture surrounded by
lush green tranquility. The villa comprises the Tata Suite on the ground level. The suite has
two bedrooms, a sitting area with a dining area attached, a pantry and a guest washroom.
It opens out into a courtyard with a private plunge pool and a massage pavilion. A wooden
VWDLUFDVHOHDGVWRWKHUVWRRUZKLFKKDVDVLWWLQJDUHDDZRUNSODFHOLEUDU\DQG
bedrooms. Rooms done up in rich silk artifacts, exclusive pieces of art by Paresh Hazra
and exquisitely designed bathrooms with toiletries from Bvlgari offer unparalleled luxury.


April 2014 

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81

PHOTOFEATURE

THE PIERRE, NEW YORK

The Tata Suite, on the hotels 39th

RRURIIHUVVWXQQLQJYLHZVRIWKH
Central Park. The 1,980 square feet
suite features an expansive living
room, two bedrooms with baths,
a dining room with custom silver
leaf table and a pantry kitchen. The
suite may be combined with other
rooms and suites to provide up to
VL[EHGURRPVDQGDSULYDWHRRU$OO
hotel guests staying in the suite can
experience the luxury of a Taj Royal
Attache, blossomed from a long
lineage of butlers who have been
creating magic in Indias imperial
residences for centuries, coordinating
the smallest details to the grandest
of whims with impeccable discretion
DQGGLJQLHGKRVSLWDOLW\


April 2014
82 Tata Review 

PHOTOFEATURE
TAJ BOSTON

The Tata Suite offers 1,540 square feet

of luxury space. Surround yourself with
lush fabrics, opulent carpets and draperies
and custom-designed furnishings. This
corner suite of rooms overlooks the
Park, also known as The Public Garden
and The Boston Common and elegant
Commonwealth Avenue Mall. The dining
table seats six and can also be used for
receptions. There is a bar for entertaining
beside the dining room and service kitchen.
5HQHPHQWVWKDWDGGWRWKH%HDFRQ+LOO
townhouse atmosphere include luxury
Frette bed linen and a duvet and feather
bed on the four-poster king bed. The stylish
beige and white marble bathroom has a
soaking tub with jacuzzi, bathtub pillow and
organiser tray and separate marble and
glass shower.


April 2014 

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83

PHOTOFEATURE

TAJ CAPE TOWN

The Tata Suite, located on the 16th and 17thRRUVLVWKHSUHPLHU7DM&DSH7RZQVXLWH,WLVH[FHHGLQJO\VSDFLRXVDQG

offers unobstructed views of Table Mountain and the Company Gardens from every room. The suite has two spacious
bedrooms, a generous lounge, a formal dining room, a dedicated pantry, a spa treatment room, a hamman steam room,
a personal exercise room and a large study. The wrap-around terrace, set against the breathtaking backdrop of Table
Mountain, provides a number of social recreation options for guests.

TAJ SAMUDRA, COLOMBO

The only one of its kind in Sri Lanka, the ultra luxurious Tata Suite located on the 7thRRULVDZRUNRIDUWDQGDWULEXWHWR
OX[XU\7KH7DWD6XLWHKDVWKHQHVWGHFRUZLWKDIDEXORXVPDUEOHRRUUHHFWLQJWKHDOOXUHRIWKH,QGLDQ2FHDQDOLYLQJ
space adorned with a Grand Piano, a graceful dining area, and an exquisite master bedroom where one can wake up
to a soothing view of the ocean. An ideal place to relax and work, the room provides outstandingly aesthetic artifacts, a
WQHVVDUHDWKRXJKWIXOOLJKWLQJGHVLJQDQGVOHHNDQGFRPIRUWDEOHIXUQLWXUH


April 2014
84 Tata Review 

PERSPECTIVE

The economy:
A rough sea ahead
A new government coming to power in New Delhi has to
put in place a long-term economic strategy that focuses on
investment, absorption of new technology and innovations for
future GDP and employment growth, says Siddhartha Roy

re-election political manifestos are

interesting to read, particularly when
read alongside Shells strategy planning
monograph New Lens Scenarios.
The current Indian situation, best described
in Shells parlance as an ocean in a churn
because of its inherent volatility, growing social
tension and decline of trust in institutions,
has prompted political leadership across party
lines to focus on income and employment
growth, lower inflation and inclusiveness.
Similarly, water, food and energy, which the
Shell monograph calls stress nexus are also
prioritised, as is urbanisation (essentially public
goods and services). Interestingly, issues such
as education, healthcare and low-cost housing
that have been deferred by the political left have
been taken up by a social left emerging out of
civil society movements.
After its disenchantment with the
planning process, the country has never had a
consistent articulation of a long-term economic
strategy. Whatever the poll outcome, the new

governments economic strategy will have to

consider the political aspirations articulated in
its manifesto.
There is a close connect between
business strategy and country strategy, adding
the concept of context to the strategy and
structure paradigm. Post-war Japan, with little
precious resources except manpower and coal,
depended heavily on its comparative advantage
in producing labour-intensive items. Belying
conventional logic however, it invested heavily
in high-value industries like petrochemicals,
steel and shipbuilding, automobiles and
consumer electronics. Finances for these
industries came from personal savings of the
Japanese population, which were chanellised

Siddhartha Roy is economic advisor to the Tata

group. He advises Tata companies in the areas of
macro econometric studies, international economics
ANDTRADEPOLICYCOUNTRYRMLEVELCOMPETITIVENESS
studies, industry modeling, new opportunity
IDENTICATIONETC


April 2014 

Tata Review

85

PERSPECTIVE

into postal savings schemes or Kieretsu Banks,

and routed into prioritised sectors by the
bureaucracy. At the same time, the government
kept the yen undervalued at 360 to a dollar
between 1949 and 1971 to promote exports.
Other successful Asian economies like
South Korea, Singapore or even post-1978
China clearly reveal how political foresight
brought government and business together
to achieve competitive advantage. Similarly,
in India, there is an inherent need to link our
manufacturing system and services sectors to
a strategic foreign trade policy derived in the
context of FTA, RTA, and WTO opportunities
and threats. Unfortunately, foreign affairs is
often conducted at variance with international
trade requirements, thus losing out on critical
areas like energy and raw material security. No
election manifesto considers Indias competitive
position which is critical for future GDP and
employment growth in an open economy.
The new government will take over at a
time when GDP growth rate has decreased from
9.5 percent (2005-06) to 4.5 percent (2012-13);
in 2013-14, third quarter GDP growth over
the same quarter of the previous year was 4.7
percent. Available indications suggest that
growth can at best be around 4.8 percent in
2013-14. Unfinished infrastructure projects

CPI (All-India) Inflation 12-M MA (%, y/y)

13

12

11.3
11

10.2
9.7

10 9.7

9.6
9

9.1
8.1

FOOD, BEVERAGES AND TOBACCO FUEL AND LIGHT GENERAL INDEX CORE

Source: Thomson Reuters Datastream, DES


April 2014
86 Tata Review 

Feb-14

Jan-14

Dec-13

Nov-13

Oct-13

Sep-13

Aug-13

Jul-13

Jun-13

May-13

Apr-13

Mar-13

Feb-13

Jan-13

7.6
Dec-12

and unutilised capacity across industries will

necessitate policies for the revival of demand,
investment growth and energy tie-ups. The
manufacturing index is at a record low, with
12 monthly moving average growth rate at 0.2
percent. National manufacturing policy wants
to propel manufacturings share in Indias GDP
from 15 percent to 25 percent. Lower demand,
high interest rates, stable but elevated energy
and raw material prices, and steady growth
in wages have brought down margins. Lower
retained earnings, reflected in lower corporate
savings, can stymie future expansion plans.
RBI has shifted its benchmark inflation
rate to CPI from WPI. The inflation rate as
measured by CPI is currently prevailing at
marginally above 8 percent. The yearly moving
average is 9.7 percent. Food which has a 49.7
percent weightage in CPI compared to 24.31
percent in WPI showed a yearly moving average
inflation rate of 11.3 percent. Having taken a
stand on inflation and inflationary expectations,
RBI will find it difficult to bring down policy
rates significantly in the near future.
From the macroeconomic stability
viewpoint, current account deficit at around
2.5 percent of GDP has markedly improved
from 4.6 percent earlier. Present capital flows
into the economy are sufficient; consequently,
rupee is gaining in strength. The foreign
debt situation is mostly under control.
Steps to curtail gold import coupled with
lower international commodity prices have
brought down growth in imports to -8.65
percent (April 2013-February 2014); while
difficult international situations have affected
exports, it continues to grow at 4.79 percent
(April 2013-February 2014). We need to
acknowledge that an overvalued rupee not
only affects exports adversely, but also brings
down landed cost of imported final goods (like
Chinese consumer goods) and affects domestic
manufacturers. Similarly, a sharp increase in
the speed of tapering or a fragile government
post-election can lead to a speedy exit of capital
from Indian markets, thereby depreciating the
rupee. In a globalised economy, the conduct of
a sovereign monetary policy becomes difficult

PERSPECTIVE

during sudden surges in capital flows which can

swing either way.
Fiscal deficit is 4.6 percent GDP in 201314; however, it must be noted that $15 bn in
subsidies have been rolled over to the next
budget in July, and capital expenditure has
been cut drastically by the current government.
These will have to be reinstated. The new
government will also be compelled to honour
the Food Securities Act, which will mean an
additional expenditure of `230 billion. Rural
wage under MGNREGA has been raised in
many states; with indexation benefits it can go
up to `214/day. The Seventh Pay Commission
will soon bring its recommendations for salary
hike in the government sector.
Rural wages have gone up by 6.2 percent
per annum in real terms during 2008-2012,
with concomitant impact on urban wages,
particularly in labour-intensive sectors like
construction. It is a vicious cycle wage hike
leads to price increase, which in turn creates a
demand for a further wage hike. The secondround effect can lead to inflation persistence.
All these will add to budget deficit in the
current year. The key issue is will the political
economy allow the new government to hold
back on steady MSP (minimum support price)
increase year-after-year and wage hikes.
So far as banking is concerned, stressed
assets and NPAs continue to rise buttressed
by poor demand conditions, lower industrial
margins and high interest rates in the
manufacturing sector; policy imbroglios
in mining and infrastructure are other
contributory factors.
With lower GDP growth, overall savings
rate has come down from 36.8 percent of GDP
to 30.1 percent in 2012-13, largely affected
by lower corporate and government savings
during the period. Household savings have
come down marginally from 22.4 percent of
GDP in 2007-08 to 21.9 percent in 2012-13.
However, the problem has been exacerbated by
shelving financial savings in favour of physical
savings (earlier gold, now land and real estate
in non-metro towns). The financial-to-physical
savings ratio has lowered from 52:48 to 32:68,

as the return on bank deposits turned negative

in inflation-adjusted terms.
The overall rate of investment was around
34.8 percent in 2012-13, mirroring that of
2005-06, when GDP grew at 9.5 percent.
Incremental capital output ratio was around
3.66 in 2005-06; GDP growth rate in 2012-13
was 4.5 percent, hence incremental capital
output ratio was 7.7. In other words, we used
more capital to produce an additional unit
of GDP. Capital productivity has come down
because of unfinished infrastructure projects
and unutilised capacity in mining and industry,
driven by policy-related delays and demand
deficiency due in part to higher interest rates.
Apprehension about El-Nino is widespread;
besides, unseasonal frost and hailstorm
in several states can take away about 0.5
percentage point of agricultural growth.
In this context, the new government will
have to develop a long-term strategy based on
investment, absorption of new technology and
innovations, and focus on select sectors where
rapid growth is possible for gaining competitive
advantage. The IT sector experience suggests
that for a quick scaling up in a sector with future
potential one needs supportive institutions
without direct government intervention.
It is apparent that 2014-15 is not going to
be an easy year. An immediate rise in economic
activity after the government changes cannot
be expected; however, a pickup in the global
economic activity and lower metal and energy
prices could provide a favourable tailwind.
Further, most political parties are not against
the growth of market economy.
REFERENCES:
Mardick, Jeff: Why Nations Grow; New
York, Century Foundation, 2002
Vietor, H. K. Richard: How Countries
Compete; Boston, HBS Press, 2007
Acemoglu, Daron and James A Robinson:
7HY.ATIONS&AIL,ONDON0ROLE"OOKS
2013
Shell: New Lens Scenarios; 2013
Studwell, Joe: How Asia Works; London,
0ROLE"OOKS


April 2014 

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PERSPECTIVE

Technology and IPRs

Technology has always been a hunting ground for imitators who
have sought unfair advantage from other peoples ideas.
Subramaniam Vutha tells us about the importance of intellectual
property rights in an uncertain and insecure environment

his article discusses the relationship

between technology and intellectual
property rights (IPR) touching upon
issues such as technology items and
their IPR aspects, the possibilities of value
addition when technologists understand and
apply IPR to technology items and issues, the
various IPR options technologists should be
aware of and the possible opportunities that
open up when IPR knowledge is applied to
technology.
There are several technology items, the
typical ones include drawings, blueprints,
formulae, technology frameworks, standard
operating procedures, methodologies,
technical specifications, technical reports,
analyses reports, test and quality data, and
technical parameters.
Four principal forms of IPR apply to
technology items or assets. Most manifestations

Subramaniam Vutha is an advocate and a consultant

with the Tata group. He chairs the Intellectual Property
Strategy Committee at the Licensing Executives
Society International.


April 2014
88 Tata Review 

or representations of technology set out in

writing or even orally expressed, are valuable
trade secrets as they embody or represent
formation that has substantial commercial
significance for a company. Moreover, they are
the outcome of the judgment, effort, time and
money expended by people working for the
company or engaged by it.
UNDERSTANDING IPR
It is important to note that the trade secret
law protects only the facts, ideas, themes and
concepts embodied or expressed in these items
and not their expression. This implies that
companies can develop and own the trade
secrets in their respective designs, drawings,
processes or tools. This is called independent
creation and is permitted.
The company that creates or engages
others to create the aforesaid items will also be
entitled to copyright protection. However, such
protection extends only to original expressions
in media such as paper, discs, charts and pen
drives as well as electronic media. Therefore,
the expression of each of these items when
documented, and therefore fixed in a medium,
would also be eligible for copyright protection.

PERSPECTIVE

Any ornamental or aesthetic and nonfunctional aspects of a product or tangible

device could be the subject of design or
industrial design protection. This can be
highly valuable when a consumer is likely to
be attracted by the products visual appeal.
Any invention which is part of the above
items can qualify for patent protection. For
instance, if the product, tool, process or a
similar item has a feature that does not exist
in the state of the art at that point in time, it
could be a subject of patent protection. Such
a feature should involve an inventive step and
should not be obvious to someone trained in
that field.
Each form of IPR provides value addition
to technology assets.
a. Trade secret protection enables companies
to protect the ideas, concepts, themes
and facts embodied in or represented by
technology items or assets, provided they
are kept secret and / or shared only under
the obligation of secrecy. Internal processes,
tools, designs, drawings, ingredients,
formulae and the like can be protected as
trade secrets.
b. A company can protect the trade secrets
of its newly introduced product from its
vendors, prototype makers or contractors
by imposing and enforcing an obligation
of secrecy.
c. Industrial design in the ornamental or
aesthetic aspects of a product confers the
right for its exclusive use on its owner. This
is of particular value in business sectors
where an attractive shape or configuration
creates customer appeal.
d. Any invention involved or embedded
in any product or process could be
the subject of patent protection. This
empowers patent owners with the right
to prevent the production, sale, use or
import of the patented product, its feature
or process without a valid licence from the
patent owner.
IPR such as trade secrets, copyright,
patents and industrial designs therefore
empower technologists in several ways,

extending (and ensuring) the benefit of the

work done in various fields of technology. In
the absence of such IPRs, any technological
advancement or creation would be open to
copying or imitation.
IPR adds significant value that can
translate into market share improvements,
sustained product differentiation, improved
realisation from premium pricing, superior
control over vendors, prototype makers and
contractors; and other benefits. Furthermore,
the use of IPRs as bargaining chips could result
in superior value from teaming arrangements
and collaborations.
THE IPR ADVANTAGE
In the journey from the laboratory or the
development/design centre to the market, IPR
plays a crucial role in the opening up of new
business avenues. For example, IP protected
product features can provide sustained product
differentiation in the marketplace. IPR provides
the basis for premium pricing and competitive
advantage during bidding.
In certain situations, even where the
technology owner loses to a competitor in a
bidding situation, it is possible to license IP
protected technology to the competitor, thus
acquiring significant value despite having
lost the bids. IPR helps attract partners and
collaborators and also provide valuable
bargaining chips while negotiating with them.
In some cases, IPR helps offset and
thereby reduce the cost of technology
acquisition through barter or exchange, thus
raising profits and profitability. New licensing
models enhance the sources of revenue and
enable companies to share their IP protected
technologies with many potential users on a
non-exclusive basis.
Without IPR, technology and technology
assets hold diminished value and potentially
short shelf lives. On the contrary, IPR adds
sustained and significant value to technology. It
is in the interest of technology creators, users,
buyers and intermediaries to understand and
leverage the rights and options that IP opens
up in the field of technology.

April 2014 

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89

PERSPECTIVE

Revisiting Pi
Innovators and intrapreneurs have an opportunity to re-imagine
technology and the computing industry, to participate in the
creation of wealth, and to change the world, says Nirav Shah

n the last 30 years, the technology

sector has seen the rise of the internet,
client-server model and the advance of
cloud computing. It has also built upon
previous innovations such as personal
computing, graphical user interface and
telecom networks. Today, it is at the threshold
of fundamental innovations that can unlock
quantum value for the next 30 years.
There are 700 million personal
computers within enterprises; with the rise of
smartphones and tablets, mobile computing
units form an installed base of 400 million
units (36 percent of devices).
But less than 5 percent of enterprise
investment is focused on mobile devices,
highlighting a disproportionate dichotomy
and a large profit pool shift; 95 percent of the
$2.7 trillion investment in technology goes to
desktop or laptop related applications, services,
networking and data centre infrastructure for
employees, partners and customers.

Nirav Shah is a senior strategist, innovator, horse

RIDERANDANASPIRINGLMMAKERWHOHASBEEN
KINDLYINCUBATEDBY4ATA#OMMUNICATIONS(ENDS
AMUSEMENTINSTUDYINGSHIFTSINCUSTOMERBEHAVIOUR
PROTPOOLSANDTECHNOLOGY


April 2014
90 Tata Review 

With the rise of the internet, the

technology sector has served as the backbone
to the global economy. Much like the
discovery of the numerical constant Pi, which
transcends the worlds of physics and geometry
and lends itself to understanding and solving
problems related to image processing, DNA
sequencing, musical notations and structural
engineering, the consequences of innovations
in the computing and communications
field can be seen in education, health care,
entertainment, design and construction,
commerce and governance.
Advances in computing and
communications technology have resulted in
an exponential productivity rise and progress
has been achieved in unrelated sectors such as
energy, space, defence and health care.
With the rise of mobility and cloud
computing, a similar wave of exponential
innovation can lead to business model
evolution and structural changes in other
sectors. Machine-to-machine communications
and 3D printing can change business models
of automobile, manufacturing and even
pharmaceutical sectors. With genomics
technology, modern health care may
simulate individual DNA patterns and print
individually customised medicines.

PERSPECTIVE

Global enterprise technology market mix

100%
90%
80%

PC-based

36%

Spend

$1T ICT opportunity

Units

400M base

20%
10%
0%

64%

$2.7T enterprise technology

spend

70%
60%
50%
40%
30%

>95%

700M installed base

CHALLENGES AND CONSTRAINTS

Mobility and technology innovations are
not without challenges. The infrastructure
required to serve seven billion mobile citizens
and multifold connected intelligent machines
is exponentially larger. There is room for
efficiency and innovation across protocols,
algorithms, architectures, applications, nano
materials and chip designs to realise the
potential of this new world.
Besides, the lack of talent and best
practices related to smart mobile computing
leads to low returns for early adopters,
and disillusions investors. Most mobile
applications replicate current functions
and do not make use of the true points of
differentiation mobile computing can offer. A
modern insurance business model that adopts
usage-based insurance policy will benefit
significantly from real-time dashboard enabled
by connected cars and mobile applications.
A survey of CIOs indicate that more than
two thirds of North American and European
insurers will increase investment in mobile
applications; however, lack of alignment
with customer interests and poor technical
execution will lead to low adoption rates.
Another challenge is inertia against
disruptive change. Incumbent insurance
companies and others are unlikely to disrupt
existing and profitable business models.
Similarly technology companies which have
significant investment in current designs are
unlikely to adopt radical approaches or refocus
existing research efforts.
Innovators and intrapreneurs with
unique insights, courage, perseverance and
assertive intent have a huge opportunity here
to re-imagine the technology and computing
industry. They can change the world, and
participate in a $1 trillion profit pool shift and
in creation of wealth. It will also reshape almost
every other industry and sector out there.
For those that are not part of technology
organisations, there is room for participation.
If your organisation does not have a leading
market share, how would you look at the
current processes, sales channels, marketing

<5%

Mobile

strategies, business models and existing

industry structure? If current immobile and
inflexible legacy systems were not a constraint,
how would you compete?
Furthermore, most organisations lack the
resources of very large companies to acquire
innovation through inorganic investments
such as HPs $10 billion acquisition of
Autonomy or Microsofts $8.5 billion
acquisition of Skype. Businesses looking
at untested business models are unlikely
to acquire large budgets for technology
enablement. Businesses and CIOs will
have to learn to work with smaller firms
and individuals. Cloud computing helped
democratise the world of enterprise IT, letting
startups such as Salesforce and Workday
become big names; the rise of mobile will
accelerate that trend. Developing applications
that build upon the work of others via APIs
will allow innovators with lesser resources to
realise their imagination.
Even after overcoming these challenges,
you may find resistance, even ridicule. It helps
then to recall what was said of our Founder
Jamsetji Tata: When you have to give the lead
in action, in ideas a lead which does not fit
in with the very climate of opinion that is
true courage and vision.
Indeed, if iron and steel was the backbone
of the industrial revolution, innovations in
technology and communications will serve as
the backbone of the digital revolution. This, I
believe, is the opportunity of a lifetime.

April 2014 

Tata Review

91

BOOK REVIEW

Once a Neanderthal,
always a Neanderthal

organisational, but hormonal and emotional

magine a world where almost everyone wakes
in terms.
up inspired to go to work, feels trusted and
valued during the day, then returns home
I HAVE YOUR BACK
feeling fulfilled. Thus starts the synopsis
Man has conquered space and landed on the
of the book on the first page and on online
moon. He can talk eye-to-eye to a person sitting
book stores.
half way across the world without taking a step
If you are in search of advanced
out of his home. Human social structures have
management techniques or business theories to
evolved and physical abilities have changed.
achieve the ideal world that company heads
However, says Sinek, the human brain is
across the globe are searching for, you will not
still wired to think in Paleolithic
find it in this tome. Simon Sinek,
terms. The herd mentality of
in his second book, Leaders
humans to stay in groups for
Eat Last: Why Some Teams Pull
safety has not changed. The
Together and Others Dont does
hormones that trigger the
not claim to offer this.
emotions of love and trust, and
Instead, Sinek sticks to good
stress and aggression are still
old biology and living conditions
the same; and the responses
in the Paleolithic ages to describe
they trigger in the body havent
an optimal work environment,
changed even the teeniest bit.
and what leaders have to look out
Humans no longer hunt or
for so that the delicate balance
gather food. Food is available
inside the Circle of Safety is not
Title: Leaders Eat Last:
stocked on shelves in the mall.
upset to pull an organisation into
Why Some Teams Pull
Together and Others Dont
We do not live in fear of attacks
a slow spiral down.
by wild animals or enemy tribes.
More than external threats
Author: Simon Sinek
We now live in fear of hostile
to a company or group, Sinek has
Publisher: Portfolio /
Penguin, 2014
co-workers and being laid off or
focused on the internal factors
being superseded. We no longer
that can bring a company down.
Pages: 347
exult in the joy of a good kill
The factors he discusses are
Price: `550
after a strenuous chase. We now
not economic, technological or


April 2014
92 Tata Review 

BOOK REVIEW

celebrate a target met within a short deadline.

However, somebody forgot to notify the
human brain that the environment outside the
body has changed. It still reacts in the manner
it was programmed to do since the beginning
of time. If leaders understand the instinctive
working of the brain, their battle to create an
optimal work environment is more than half
won, says Sinek.
Sinek offers the theory that to become
a good leader you have to only ensure that
emotions such as selflessness, love, trust and
empathy flow abundantly through the group
and the human need, since Paleolithic times, to
feel safe within the group is met. Leaders have
to build a circle of safety within which their
employees or group members live protected.
Safe in the knowledge that their
teammates will look out for them, even as
they look out for their comrades, members
work unitedly towards fulfilling their leaders
and organisations goals, robustly and happily
fighting external threats.
KEEP THE CIRCLE STRONG
Sinek, in the first 55 pages, introduces the
concept of the Circle of Safety and the selfless
and selfish chemicals which help the free flow
of emotions that strengthen and maintain
the circle, and the bad chemical cortisol that
causes stress and breaks in the circle. He
devotes a whole chapter to a detailed analysis of
endorphins, dopamine, serotonin and oxytocin
and their role in keeping together a group
in prehistoric times. The rest of the book is
devoted to support the circle concept and the
play of hormones in maintaining balance.
Although the book is divided into eight
parts, it progresses non-linearly with content
put together rather haphazardly. Real and
imaginary examples from the animal world and
the business, military and civilian worlds break
the tedium of the read, although the theories he
puts forward are sometimes illogical.
So you are told how the war years, despite
being times of scarcity and hard toil, actually
encouraged cooperation, sharing, trust and
brotherly love, and kept groups strong; how

baby boomers, brought up in times of plenty,

became a me-first, selfish generation, looking
out only for themselves and led a change in
organisational cultures.
Also how US President Ronald Reagans
decision to fire 11,359 air traffic controllers
on August 5, 1981, and imposing a ban on the
strikers from working for the Federal Aviation
Administration (the ban was lifted in 1993
by President Bill Clinton) sent out a signal
to company heads and leaders that it was
acceptable to cut human numbers to bring up
financial numbers.
WHEN NUMBERS COME INTO PLAY
An interesting example is how Bill Gore,
co-founder of WL Gore & Associates,
manufacturer of GORE-TEX products, caps
his factories at the magical Dunbar number of
150. Robin Dunbar, professor of evolutionary
anthropology at the University of Oxford,
arrived at 150 as the number that people can
maintain close relationships with.
Equally interesting is the discussion on
the consequences of abstracting humans to
numbers and the chapter on Yale psychologist
Stanley Milgrams study on why humans act
like lemmings and blindly follow orders from
higher authorities.
Milgram conducted the study after the
trial of Otto Adolf Eichmann, the German
Nazi SS-Obersturmbannfhrer (lieutenant
colonel) responsible for managing the logistics of
rounding up and deporting Jews to concentration
camps and ghettos during the Holocaust. He
was living under the assumed name of Ricardo
Klement in Argentina for 15 years, till he was
captured and put to trial in Jerusalem.
Sinek may have attempted to put forward
a fresh perspective on leadership; however, after
the introduction to the Circle of Safety, you may
lose interest as you realise that he has nothing
new to say. The irregular manner in which
the content is structured is also a put-off. The
book could have done with a bit of editing for
repetition and language.
Shalini Menon


April 2014 

Tata Review

93

BOOK REVIEW

Circle of safety
An excerpt from Leaders Eat Last: Why
Some Teams Pull Together and Some Dont
The urgency to meet expectations, the
strain of capacity and other outside
pressures all contribute to the constant
threats that a business faces. At all times,
these forces work to hinder growth and
OQNS@AHKHSX 3GDRDC@MFDQR@QD@BNMRS@MS
We have no control over them, they are
never going to go away and that will never
change. Thats just the way it is.
There are dangerous forces inside
our organizations as well. Unlike the
forces outside, the ones inside are
variable and are well within our control.
Some of the dangers we face are real
and can have immediate impact, like
layoffs that may follow a bad quarter or
an underperforming year. Some of us
face the very real threat of losing our
livelihoods if we try something new and
lose the company some money. Politics
also present a constant threatthe fear
that others are trying to keep us down so
that they may advance their own careers.
Intimidation, humiliation, isolation,
feeling dumb, feeling useless and rejection
are all stresses we try to avoid inside the
organization. But the danger inside is
controllable and it should be the goal of
leadership to set a culture free of danger
from each other. And the way to do that is
by giving people a sense of belonging. By
offering them a strong culture based on a
clear set of human values and beliefs. By
giving them the power to make decisions.
By offering trust and empathy. By creating
a Circle of Safety.
By creating a Circle of Safety around
the people in the organization, leadership
reduces the threats people feel inside
the group, which frees them up to focus
more time and energy to protect the
organization from the constant dangers


April 2014
94 Tata Review 

outside and seize the big opportunities.

Without a Circle of Safety, people are
forced to spend too much time and energy
protecting themselves from each other.
It is the company we keep, the
people around us, who will determine
where we invest our energy. The more
we trust that the people to the left of us
and the people to the right of us have
our backs, the better equipped we are to
face the constant threats from the outside
together. Only when we feel we are in
a Circle of Safety will we pull together
@R@TMHDCSD@LADSSDQ@AKDSNRTQUHUD
and thrive regardless of the conditions
outside.
The Spartans, a warrior society in
ancient Greece, were feared and revered
for their strength, courage and endurance.
The power of the Spartan army did not
come from the sharpness of their spears,
however; it came from the strength of
their shields. Losing ones shield in battle
was considered the single greatest crime
a Spartan could commit. Spartans
excuse without penalty the warrior who
loses his helmet or breastplate in battle,
VQHSDR2SDUDM/QDRRDKCHMGHR@BBNTMS
of the battle of Thermopylae (the battle
upon which the movie 300 is based),
but punish the loss of all citizenship
rights the man who discards his shield.
And the reason was simple. A warrior
carries helmet and breastplate for his own
protection, but his shield for the safety of
the whole line.
Likewise, the strength and endurance
of a company does not come from
products or services but from how well
their people pull together. Every member
of the group plays a role in maintaining
the Circle of Safety and it is the leaders
role to ensure that they do. This is the
primary role of leadership, to look out for
those inside their Circle.