Case 5.2 Organizational Transformation at the Tata Group Essay

756 Words Aug 3rd, 2013 4 Pages
In the beginning, Tata Group’s initial organizational approach was to develop location bounded FSA’s and expansion in diversified SBUs in home country which build the capacity of TATA as centralized exporter. Restructuring of Tata was the basic step towards approach shift and development of internationally transferable FSAs like technical expertise, novel management practices and human capital. To take advantage from the FSAs which Tata developed, it used many expansion strategies like outsourcing, joint ventures and wholly owned subsidiaries which assist TATA to recombine its resources and gained competitive position in IT and communication industry which is evident from the establishment of TCS.

Diversification strategy proved
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In the high level management, there is a model that can help to indicate different subsidiary roles called a simple subsidiary classification system. It categorises into four subsidiary types including Black hole, Implementer, Strategic leader and Contributor. Strategic leader is a highly component local subsidiary in a potential market. The action can support corporate with headquarters in determining industry and marketing trends, as well as improving new FSAs, in the case the home country location-bound is counted from development of domestic market (they also combine the knowledge for the new international FSAs subsidiary), in order to outweigh opportunities and threats. Tata group’s subsidiaries and affiliates were managed separately with their own strategic forms for expanding the company globally which suit with the specific nature of each area. However, as a strategic leader process, they still focus on the domestic market. The Tata Consultancy Services (TCS) is the main key for this management. The system gives Tata the effective local operations that would advance product line and emerge into international plan. For example, according to the case, in 1979 TCS was established outside for first time at New York, United States, discussing the knowledge and information about new technologies and skills. Those useful advises were sent back to the headquarter in India to enhance local market. They are very concern on

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