The genesis of the business excellence movement in the Tata group can be traced to its birth in the late 1890s under Jamsetji Tata. Jamsetji's vision of his business house was that of a pioneering enterprise that willingly took upon itself a much larger mandate encompassing ventures that supported nation building and community development. Early in the twentieth century, while Indians were ruled by the British empire, the Tata group built India's first steel plant, first hydro-electric power plant and the first Indian luxury hotel. The group also invested in setting up India's first institutes dedicated to the advancement of social sciences and fundamental research.

 

It was this same pioneering spirit that led to Tata companies taking up business excellence as a formal internal initiative as far back as two decades ago, when India lumbered under the yoke of the licence raj. Tata Steel, Tata Honeywell, Tata Motors and Tata Chemicals, among others, introspected on quality standards and improvements, and undertook several initiatives to boost quality and performance measures.

 

It was in 1994, when Tata Sons Chairman Ratan Tata inherited the leadership from predecessor JRD Tata, that the Tata group took a large step on the journey to business excellence. Ratan Tata had a clear vision – he wanted the name of Tata to stand as the hallmark of quality, not just in India but on the global stage. To achieve this, all Tata companies, products, services and employees had to be aligned under the excellence initiative.

 

After much debate and discussion, senior Tata leaders chose a formal roadmap – the Malcolm Baldrige National Quality Award, a quality programme that at the time was working successfully among US companies trying to compete with Japanese and European firms in the marketplace. The Baldrige model was a diagnostic tool that told companies how well they functioned in their business practices and how strong their approach was to business and managerial aspects. On a scale of 1000, a score below 450 denoted an early stage of development. The 450 to 550 band was considered a 'good' score. A company that scored 550 to 650 was considered an emerging industry leader; scoring above 650 was needed to be considered an industry leader. Benchmark leaders scored above 750 and world-class leaders above 850.
In a bid to motivate and commemorate the efforts of Tata companies to excel, Mr Tata instituted the JRD Quality Value Award in memory of JRD Tata in September 1994. It was a quality initiative that set down guidelines and benchmarks for companies to enhance their management processes, irrespective of product, service or industry segment. The JRD QV Award process, like the Malcolm Baldrige methodology, assessed core aspects of business operations: leadership, strategic planning, customer and market focus, human resource focus, process management, business results, and measurement, analysis and knowledge management.

The JRD QV Award process set the bar high – a score of 600 was necessary to win the award, thus motivating Tata companies to push forward to become industry leaders in their respective fields. This was a move that came at the right time. “We are moving into a highly competitive environment – the India of tomorrow. Obviously, if our name should stand above our competitors, we need to be highly market oriented, much more driven to the customer's needs, much more sensitive to the needs of the marketplace and conscious of the quality of our products and services... and more importantly, conscious and aware of the quality of our business processes,” said Mr Tata at the very first JRD QV Annual Convention held in 1995 at Mumbai.

 

The process was administered by Tata Quality Management Services, a unit set up in 1996 to guide and assess Tata companies on the methodology of excellence. The JRD QV Award process has since been rechristened the Tata Business Excellence Model (TBEM). It encompasses the entire Tata group, even new acquisitions and overseas companies come under its umbrella. From those initial days, when the group registered low scores of 200-odd on the scale, the group average score is close to the 500 mark, an achievement of considerable significance as the Tata fold now has nearly 100 companies with operations spanning the globe.

 

Eight companies have already won the JRD QV Award – Tata Steel, Tata Consultancy Services, Tata Motors, Titan Industries, Tata Chemicals, Tata Metaliks, The Tinplate Company of India, and Telcon. Several of the winners are already amongst the world's top corporate names. More important, the business excellence movement supplies formal recognition to business aspects such as governance, sustainability, innovation, and ethical business practices, traits that enable Tata companies to stand out as leaders in management processes.

 

Mr Tata, addressing colleagues at the Business Excellence convention of 2006, said, “Excellence is not something that we can buy. It is not something that we can acquire overnight. It is a long process. It takes commitment.... This is not a world of just taking awards. It is a long, twisted, difficult road, filled with obstacles. Let us all keep excellence and operations through excellence as being our guidelines as we move into the future and continue to believe in what we are doing, so that we can continue to lead and never to follow.”