Tata Communications: Building a Global-Local Operating Model

6825 Words Jun 8th, 2011 28 Pages
Tata Communications: Building a Global-Local Operating Model
By Stéphane J.G. Girod, Joshua B. Bellin and Robert J. Thomas November 2009

Case Study

Tata Communications: Building a Global-Local Operating Model

A Mumbai-based “global startup” in the rapidly changing communication-services industry must decide how to manage its global footprint and surmount new industry challenges—all while honoring the Indian cultural values it was founded on. Its solution? Build a “global-local” operating model in which “hard” components like business processes and performance metrics support the “soft” component of leadership and people—and manage the challenges that come with the model.
Tata Communications’ fast international growth
Tata
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The company then reorganized itself— setting up global business units based in Singapore (data services), in Montreal (voice services) and in India (Internet broadband). (See Table 2: Tata Communications’ Business Units.) The company’s sales revenues doubled between 2006 and 2007. But it was 2008 that saw the biggest expansion of Tata Communications’ global footprint. Foreign sales made up 57.3% of total sales, and the company became the world’s VoIP (voice over the internet protocol) leader. With its 200,000 kilometers of cables connecting 200 countries, it also became the world’s largest submarine cable operator. Its market capitalization climbed to $5 billion, and it ranked seventh in earnings-per-share growth among 3,000 U.S.-listed peers.

Today, Tata Communications’ senior leaders are transforming the company into more than just a utility provider: they are committed to challenging other multinational market leaders. As Vinod Kumar, Tata Communications’ chief operating officer, explained: “We want to be a meaningful challenger to the likes of AT&T and Verizon and other business services, because we believe that their fairly large monolithic organizations will have silos with a lot of organizational and technology legacies. But as a new operator, we are fueled by growth from emerging markets, so we have [new] capabilities.” To that end, Tata Communications has