Saurav Mukherjee and R Radhakrishnan

The winds of change are sweeping through Bombay House. Get prepared to be swept away

In fact, it really is all about not being the same. About changing. Read Chairman Ratan Tata’s lips: "A company or business which remains static is a business that will die; a company that constantly changes and accepts that there are better ways to do things than the way they are done today, is a company that will survive in the global market that we face."

This is not just a statement at a Tata conference. It is an acknowledgement that complacency can upset any group’s leadership position, including the Tatas. That failure to benchmark against competition may prove too costly in the 21st century’s war over mind space. Or lead to weak submission to hostile raiders. It is also a war cry for tomorrow.

Which is why, for a couple of years now, a dedicated senior management team has been working 24x7 on a blueprint for the Tata Group’s date with tomorrow. The results are already there to see:

• A Group Executive Office (GEO) has been created with a clear mandate: design and implement change and provide long-term direction to the Group.
• As a defence against hostile takeovers, there has been slow and steady increase in shareholding in key Group companies.
• Individual companies have been brought under a common ‘brand’ umbrella.
• The Group’s businesses have come under the microscope through rationalisation of portfolio, divestment and investment.
• For the Tatas it is a holistic approach to the business of change. They are addressing the phenomenon called change at every possible level — operations, processes, management, leadership, human resources, branding.

And the change is being driven right from the top. Mr Tata set the ball rolling when, in 1998, he brought in HLL vice-chairman R Gopalakrishnan and I-Sec managing director Kishor Chaukar as executive director of Tata Sons and managing director of Tata Industries, respectively — the first ‘outsiders’ to step into Bombay House.

The setting up of the GEO was another important step — it marked the beginning of distribution and delegation of leadership responsibilities within the Group.

As Mr Gopalakrishnan says, "Change provides impetus to the organisation. When corporations around you are changing, even if you don’t change, you get automatically repositioned."

Brushing up the brand
Despite being valued at over Rs10,000 crore, the Tata brand "was not perceived as purposeful and dynamic". "People are not significantly aware of the changes in the Tatas, or maybe we are not communicating our change as well as we should," says Mr Gopalakrishnan.

The agenda on the branding front, then, is clear: articulate the changes happening within the Group to the right audiences, at the right time, in the right manner. What began as a change in the Tata logo a couple of years ago has, thus, turned into a full-blown brand revamp endeavour.

The GEO has spelt out the four-letter brand mantra for the Group — SMFG. Savvy. Modern. Futuristic. Global. SMFG symbolises the four most important qualities that perception studies indicate the Tata brand needs to stand for.

At the top of an SMFG pyramid prepared by the team is one deceptively simple question — "Are you being touched by the Tatas today?" — the answer to which is expected to help Group companies reassess and redefine themselves.

Efforts are on to ensure that the SMFG strategy is communicated in a proactive, responsive and aggressive manner to all constituents — customers, partners, shareholders, employees, media and, not to forget, competitors.

The accent is on highlighting the following ‘change events’ on a continuous basis:

• The Group’s leadership at the frontiers of technology
• Its overall globalisation vision
• The asset base in terms of knowledge capital
• Group synergies that drive efficiencies and cut costs
• Impact of the Group’s businesses in the market

All these are already part of the Tata reality. Now the challenge is to get this across to the audiences concerned and to alter the Tata Group’s image as an old corporation that is slow to change.

So what happens to the age-old associations with the Tata brand? For instance, what about the quality of trust attributed to it?

"Trust means different things to different people. SMFG contemporises the expectations of the trust that people have in the Tatas. Trust today is interpreted as sharing the fruits of progress. That’s what customers and shareholders want," says Mr Gopalakrishnan.

Message #1
Perception is reality, so do something about it.

Talking business, the Tata way
When the Tata Group divested its stake in the Associated Cement Companies, it was an act of trust. It was an acknowledgement that the Tatas could not be market leaders in cement and that it was better to let go than settle for anything less than the top position. For, being the leader in whatever it does is one of the commitments the Group has made to itself.

Another project is to deconstruct the divide between old and new economy companies. The idea is to drive home the point that Tata Group companies — be they tech companies or so-called old economy ones — are forever integrating cutting-edge technologies to enhance the way they do business.

Take Tata Chemicals and Tata Steel, for example. There’s nothing old about these companies. They have the ability to use emerging technology in a relevant way.

Need more evidence? Consider this:

• Tata Steel is planning to commercialise and patent imaging systems and global positioning systems for the mining industry. This has been developed by its in-house automation division, which will eventually turn into a profit centre. Tata Honeywell, the Group’s automation company, will provide marketing expertise to Tata Steel.
• Tata Engineering is foraying into robotics.
• Tata Chemicals is adopting satellite-imaging technology with the help of the National Remote Sensing Institute, Ahmedabad, to develop a geographical information system. The system, to be launched early next year, will help farmers in northern India monitor crop growth and sowing based on digital soil mapping data.
• Rallis is working on a process to curtail the product development life cycle of seeds.

The Group has decided there is no point being cosmetically nationalistic and delivering products at any cost. In the end, indigenisation means relevance and affordability. The Group wants to be pioneers at whatever it does.

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Uploaded on March 5, 2002