Case study on Tata and GE

Infering TATA’s culture – A press report write- up
FINANCIAL year 2004 must have brought the smiles back at Bombay House, the headquarters of Tata Group. Key Tata companies have fared well, quarterly profits have been good and year-end figures are expected to follow the trend. Restructuring has helped major Tata companies weather downturns. But as it satisfies markets and investors, can the group resist pressures for a character change? Or, should it yield?
Last October when two temporary workers engaged previously in a Tata Power project attempted self-immolation in front of Bombay House, it brought out the darker side of economic growth. The soot stains on the road where the workers fell, betrayed pain within a booming economy and a plea to those best placed to address it. Bombay House, after all, is headquarters to the Tata Group. For most, Tata is synonymous with humaneness.
Mr Ratan Tata
Thus, despite bigger companies coming up, Mr Ratan Tata remains one of the most respected industrialists. He was less than a year into his role as Non-Executive Chairman of the Group when the incident happened. In December 2002, on turning 65 he relinquished executive powers in line with the group's policy.
Deemed a technical change — the late J. R. D. Tata was non-executive chairman for many years — the slight shift to his designation was nevertheless a time to retrospect for those tracking Mr Ratan Tata's tenure at Bombay House. Coincidentally, just a few days before the change occurred, Tata Motors unveiled the Indigo sedan, further vindicating its foray into car manufacturing.
In 1988, soon after assuming chairmanship, Mr Tata tackled a labour crisis at the company. Tata Motors' subsequent journey through a risky car project to its becoming one of the world's top truck makers and among India's top three car manufacturers encapsulates the nature of change Mr Tata wants at the group.
Taking over a conglomerate, in which some companies were ruled by longstanding helmsmen who had fashioned them into personal fiefdoms, Mr Tata's central achievement was putting the glue back into the group.
This seemed to be done in tune with modern reality, reposing reduced emphasis on the promoter's identity, bonding instead through ownership and shared values.
The promoter's stake in key Tata companies was increased and membership to the group rooted in codes of functioning and adherence to brand values. The group made solid progress with its old economy companies — Tata Steel has a new cold rolling mill, Tata Motors has entered the cars sector and Tata Tea has acquired Tetley.
There were exits too, as from Tata Oil Mills Company, Lakme, ACC and Tata Infomedia. There were also slip-ups, prominent being the troubles at Tata Finance and Rallis.
But on the upside, the Tatas became a leading player in telecom through VSNL and Tata Teleservices, while IT-major Tata Consultancy Services continues to fare well. At several AGMs, Mr Tata highlighted the need to make the companies competitive. Luckily for him, in certain cases the revitalising of the company coincided with India's economic growth.
Why, then, the suicide attempts before Bombay House? The answer probably lies in the tradition of charity which the Tatas cannot stop overnight. Homi Modi Street, where the Bombay House stands, should have been the last place for such a protest, yet by the same yardstick it is the most effective to drive home a message. Jamshedpur is the biggest social cause the Tatas have supported.
But even in Mumbai where money was never in short supply, Bombay House was a regular port of call for those with a dream but no resources.
From charity organisations to mountaineering expeditions, from hospitals to cultural programmes and sporting events — all list Tata among the resource providers.
These values contributed to the Tata brand image, and in a group where the promoter and brand share the same name it influenced how senior company officials were seen in public.
In fact, it will not be wrong to suggest that even as the group chases profit, the respect attached to the Tata name stems from a perceived reluctance to pursue profit for profit sake.
It is not easy for the group to dilute the image, though today's economic scenario demands nothing but professional focus. Mr Tata has put the structural glue back in the group, given it the ability to reward investors.
But public perception depends on how much the Tata character may change amidst the ascent of the economy.
Sir Ratan Tata's Vision His thoughts, in 1913, on the manner in which the Trust's funds could be used "... for the advancement of Education, Learning and Industry in all its branches, including education in economy, sanitary services and art, or for the relief of human suffering or for other works of public utility.... "To engage qualified and competent persons to investigate into matters that pertain to the social, economic or political welfare of the Indian community, the object being to design schemes of a practical nature calculated to promote the welfare of the said community, care being taken that such work is not undertaken from the stereotyped point of view but from the point of view of fresh light that is thrown from day to day by the advance of science and philosophy on problems of human well-being... Purpose Espoused valuesAt the Tata Group our purpose is to improve the quality of life of the communities we serve. We do this through leadership in sectors of national economic significance, to which the Group brings a unique set of capabilities. This requires us to grow aggressively in focused areas of business. Our heritage of returning to society what we earn evokes trust among consumers, employees, shareholders and the community. This heritage is being continuously enriched by the formalisation of the high standards of behaviour expected from employees and companies. The Tata name is a unique asset representing leadership with trust. Leveraging this asset to enhance Group synergy and becoming globally competitive is the route to sustained growth and long-term success. Five core valuesThe Tata Group has always sought to be a value-driven organisation. These values continue to direct the Group's growth and businesses. The five core Tata values underpinning the way we do business are: Integrity: We must conduct our business fairly, with honesty and transparency. Everything we do must stand the test of public scrutiny. Understanding: We must be caring, show respect, compassion and humanity for our colleagues and customers around the world, and always work for the benefit of the communities we serve. Excellence: We must constantly strive to achieve the highest possible standards in our day-to-day work and in the quality of the goods and services we provide. Unity: We must work cohesively with our colleagues across the Group and with our customers and partners around the world, building strong relationships based on tolerance, understanding and mutual cooperation. Responsibility: We must continue to be responsible, sensitive to the countries, communities and environments in which we work, always ensuring that what comes from the people goes back to the people many times over.

GE Appliances – Case on Organisational Decision making issues

In the 1990s GE faced a major decision. GE’s appliance division, maker of well known products such as dishwashers, ranges, refrigerators and washing machines, was fighting declining profitability, and Appliance Park, GE’s complex of factories near Louisville, Kentucky, which employed 10,000 of the company’s 22,000 workers, was losing a substantial amount of money. The washing machine operations, technologically outdated, were contributing significantly to this loss, and GE had to evaluate two alternative courses of action : Should GE spend $70 million and make a major investment in new technology to bring the washing machine operations up to date so that GE could compete into the next century, or should GE close down its washing machine operations and buy from another manufacturer washing machines that it would sell under its own brand name?

To evaluate each alternative, GE’s managers tried to decide which one would lead to the best long-term outcome for the organization. They used criteria such as manufacturing costs, quality, profitability, and product development costs to evaluate each alternative. One of the factors that GE was most concerned about was whether the unions in its appliances Park operations would agree to flexible work arrangements that would reduce labor costs. There had already been significant job losses, and GE managers had been sitting down with the unions to hammer out a new work agreement that would allow the corporation to evaluate its future labor costs. Using information on future labor costs and internal forecasts of future product development and manufacturing costs, managers tried to assess whether the investment would lead to a profit. At the same time, managers talked to companies like Maytag and Whirlpool to determine what it would cost GE to have them make a washing machine according to GE specifications.

If GE could buy another manufacturer’s washing machine for less than it would pay to make its own, then it seemed to make sense to choose the less costly alternative. However, GE’s managers had to evaluate the effects of other factors. For example, if GE stopped making washing machines, it would lose a core competence in washing machine production that it would be unable to recover. Suppose the company that GE chose as its supplier failed to live up to its agreement and put only its old technology into the machines it supplied GE, or lower in quality that the machines it produced for itself. GE would be at the mercy of its suppliers. On the other hand, suppose the unions reneged on the contract and refused to cooperate after GE had made the investment in modernizing the washing machine plant.

The situation was further complicated by appliance division managers who were lobbying for the investment because it would protect their jobs and the jobs of 1,500 workers. The division managers championed the advantages of the investment for improving the competitive advantage of the division. Corporate managers, however, had to evaluate the potential return of the investment to the entire organization.

GE’s managers had a very difficult time evaluating the pros and cons of each alternative. Because of uncertainty, they could not accurately predict the consequences of any decision they made and had to rely on their knowledge or and experience in the appliance market. However, they decided that GE would make the investment and continue to produce its own washing machines. New lines of modern washing machines were introduced throughout the 1990s. In 1999, GE opened a $5 million Reliability Growth Test Centre and it tripled the amount it spends on R&D in 1999 to produce appliances that never break down and which ‘delight’ its customers. Nevertheless in 2003, GE like Maytag, was still losing money from its appliance division, while main rival whirlpool was experiencing record sales and profits and GE’s managers were still trying to figure out what to do.

Discussion on Change management by Dr Nirupa Bareja

Change is the only constant thing in the world stage

Dr Nirupa Bareja

Introduction

Dr Nirupa Bareja is the ex- group head-HR, Biocon Limited, the biopharma giant of India . With a PhD in Marine Biotechnology, Dr Bareja joined Biocon in December 1989 and she was instrumental in setting up the HR division of the company before working in domains like manufacturing and quality assurance. She lets us know her ideas on change management on her discussions with TAPMI PGDM students

Company

Biocon

Is India's leading biotechnology enterprise. Established in 1978, the company today is an integrated biotechnology enterprise focused on the development of biopharmaceuticals. The company serves partners and customers in over 50 countries. Within the biotechnology space, the company ranks first in Asia in terms of revenues and market capitalization and sixteenth globally.

What is change management

Organizational change management is the process of developing a planned approach to change in an organization. Typically the objective is to maximize the collective benefits for all people involved in the change and minimize the risk of failure of implementing the change. The discipline of change management deals primarily with the human aspect of change, and is therefore related to pure and industrial psychology.

Many technical disciplines (for example Information technology) have developed similar approaches to formally control the process of making changes to environments.

Change management can be either 'reactive', in which case management is responding to changes in the macro environment (that is, the source of the change is external), or proactive, in which case management is initiating the change in order to achieve a desired goal (that is, the source of the change is internal). Change management can be conducted on a continuous basis, on a regular schedule (such as an annual review), or when deemed necessary on a program-by-program basis.

Work flow pattern

Workflow patterns refer specifically to recurrent problems and proven solutions related to the development of workflow applications in particular, and more broadly, process-oriented applications. The different kinds of workflow pattern are

• Time management
• Awareness of responsibility level
• Team building
• Pride in the work

New systems- Introduction and implement

Change management in her case includes People awareness and training in the HR function, documentation and quality systems in the quality function as well as dedication and hard work in manufacturing domain

Experience in manufacturing industry

Learning exercise

Transforming from a marine bio technologist to the single production girl was a change.

Complete streamlining of manufacturing process

Streamlining a different process and a challenge

Automation of process and system

Production operator’s motivation

Made sure that the motivation level of operators increased and this Increased productivity

New process of performance and management

The next transformation is to the QA department.

Restructuring process

Technical knowledge

Change into the HR function

Unique methodology of Setting the company apart

Optimization of resource

Tremendous sense of team- Open day, kids day

Language barrier

Introduction of novel training methods

Innovative induction process

Advantages of change management

Multiple experiences in different departments

Empathetic with team

Complete cooperation from all the departments

Learning personally each department needs and requirements

Respect of entire organization

Company recognistion

Company Innovision awards and external reorganization

Image and brand building- Individual to company

Company that celebrates together stays together

Stress, communication skills, time management, team building

Social responsibility

Dr Nirupa Bareja

Dr Nirupa Bareja, ex- group head-HR, Biocon Ltd. With a PhD in Marine Biotechnology, Dr Bareja joined Biocon in December 1989 and she was instrumental in setting up the HR division of the company. "I had a very unique role in Biocon and had a domain of my own. I thoroughly enjoyed working in the company. Kiran Mazumdar-Shaw has been a wonderful boss and Biocon is a superb organization. I will continue to have the same relationship with her and the others as it was when I was in the company," she said.

http://www.biospectrumindia.com/content/bioPeople/10502111.asp

DECISION MAKING talk by Prof. Ajit Chakravarti

DECISION MAKING by Prof. Ajit Chakravarti

Session Date: 11:11:2006

Terminology/Learning’s shared during the session:

· Quality Time: Add Value to time. The time during which we achieve what we aspire for

· All Decision Making – makes us move on a path of change

· The More we grow – the more Decision we take by Ease

· Stress Buster: Decision making is like a stress buster, whether decision take was appropriate or not, can be decided later but for that moment it acts like stress buster

Objectives of the session:

· Understand the Importance of Effective Decision Making in Management

· Understand the Role of Time and Relationships in Decision Making

· Experiencing Problem and Opportunity finding Processes in real life business Situations

· Understand the personality Dimension in the decision making process

· Appreciation of the distinction between programmed and non programmed decision

· Appreciation of certainty, risk and uncertainty in decision making

· Understand different decision making models

· Identify individual decision making approaches at the conclusion of the season

Parameters of the “Key Objectives” of the session:

· Involvement

· Sharing and Experience

· Open Mind / Willingness

· Effective Communication

· Risk Taking – Conscious of Consequences

· Participation

Why Decision Making? (A group Brain storming session)

· Life is Full of Opportunities

· Life is a Choice

· Status Check

· New Beginning

· Achieve a Goal

· New Beginning

· Turning Point

· Overcome Crisis

· Status Check

NIKE CASE STUDY: - Key Highlights

· Slow Growth in the market/De Growth

· Competition eating into

· While Reebok looked at short time success – Nike had long time Ambitions

NIKE CASE STUDY: - What decisions were taken by the company?

· Strategy to Specialize

· Decision to “get out of the situation”

· Part of the dream team in Olympics

· Worked on Comfort factor – in relation to the game of Basket Ball

· Longitivity of the Relationships

· Multiple form of identifications found in Jordan

· Teaming up with a “Fading Star”

· Choice of Jordan – why? - Multiple Personalities as Brand Ambassador

NIKE CASE STUDY: - How appropriate were the decisions?

· Relationship as a factor

· Creating a Differentiator

NIKE CASE STUDY: - Some of the Key Findings

· Calculated risk involved in all Decision Making process

· Decision making is a consequence of the prevailing circumstances – which were:

o Connect to the path which is different

o FORESIGHTEDNESS

o Detach and Detached Involvement

· Escalation of the commitment

· Decisions should be frozen on time

· Timing (and Environment) of the Decision making is very important

· Variable in Decision Making - What is there in today may not be there tomorrow

· Time Elapsed (from the time when the decision was taken and to the time when the action was implemented) – sharper perception for what would be there in future

· Game Theory – Decision Maker should create an environment for the decision to be appropriately followed

· Set of Decisions – Make a strategy (example that of many how many leaves make a branch of the tree)

· Closing of the Decision id VERY IMPORTANT

· Set of Decisions – lead to a Grand Play

TIME and HUMAN RELATIONSHIPS in Decision Making:

· Concept of Chinese/Japanese vis-à-vis Americans while signing an agreement

o While Chinese/Japanese make an agreement – for them that’s a start of Relationship

o Chinese/Japanese have a clarity of roles and what stage of negotiation they are in

o Chinese/Japanese would be there on site and not like Americans who would manage with, say – video conferencing

o Chinese/Japanese – while there decision making process – leave room for the “expect the unexpected”

· Decision Making process should not be done in isolation – and also be aware of the party involved in the same

· Time “0” to Time “T1”

Problem Finding and Opportunity Finding

· What is a problem?

· What is an Opportunity?

Example: that of 35 Afro American Farmers:

· Soya bean cultivation

· Problem was to find a new market

· And then Finding an Application (alternate plan)

Problem finding (sensing a plan)

· Deviations from the past experience

· Deviation from a set of plans

· The performance of the competitor

Alert Managers – Sense the same problem early

· Sense of REALITY

· FINE TUNED Perception

· EQ (able to sense thru “with people” through verbal acts

· IQ (ale to sense through knowledge and intelligence

Three Pitfalls

· False associations of events – Wrong Mergers and Acquisitions

· False Expectations of the events – FDI in Retail

· False Self Perception and Social Image – We are BIG, they are SMALL . . . so we will also do it and end up biting the dust)

Opportunity findings

· Missed Opportunity create problems

· Opportunities are found while exploring the problems

· Use of Di – Electical Enquiry Method (Devils Advocate)

Enormous Research on Problem solving where as little research on Problem Finding:

· “Quote Unquote” – Peter Ducker: Opportunities rather problems are the key to organizational and managerial success

· Solving a problem merely restore normality where as progress must come form the exploitation of the opportunities

Problem Recognition

What INFO to Collect

ROLE of JUDGEMENT

PEOPLE with ACUMEN

Example: Many People Leaving the Organisation – Realiszing that many people leaving the organisation id not about attrition but situation of “high pressure” leads to “weak people” leaving the organisation which is for the good og the organisation in the long run

Some more - Terminology/Learning’s shared during the session:

· Failure Avoidance: Let the juniors/subordinate take the decisions pertaining to there accounts and responsibility and let “you” as managers look into the larger interest. Rely on people that what ever task given, they would perform to there optimum level – trust there capability

· Certainty /Risk/Uncertainty

· Atkinson’s 3 Needs Theory:

o Affiliation

o Power

o Achievement

· LIFO – Last in First Out

· Pilot Plan

· Game Theory – You don’t operate in Isolation – take into account the competition

· Self Introspection on Problem Recognition:

o Growth

o Innovation

Interpersonal Dynamics

Teams: Red Square & Maniacs

Team assignment on case analysis of Bob Knowlton

1. Identify the various factors that is contributing to the interpersonal dynamics between Knowlton and Fester in their team.

Bob Knowlton

- Felt that his leadership was at stake because a) Jerrold was extremely impressed with Fester and also was expressing that openly with the team b) Fester was very sharp and competent and had solved some old problems c) He felt that Fester was slowly taking over leadership informal control of the team

- Unable to discuss his opinions/feelings/conflicts with Jerrold and teammates a) although Jerrold and Bob share an open relationship, Bob has not indicated to Jerrold that he is having a problem. Because of this Jerrold also does not have a hint what is going on in Bob’s mind b) Bob should have communicated to Fester his roles and responsibilities while he was working in Bob’s team c) ?

- Reiterating the research lab’s and the team’s way of functioning when Fester confronted the team with his own philosophy of research. As a result of this Bob may have lost some self-esteem and the respect of his team members.

- In the face of Fester’s brilliance and challenge to his leadership, Bob did not respond in the manner in which the leader of the team should have done inability to exercise authority and control when parity in team is disturbed. As a result his self-confidence in his capabilities reduced.

Fester

- In the first meeting with Bob, he tried to over project himself. As a result of this he ended up making Bob uncomfortable. The first impression that Fester created on Bob was that of discomfort and annoyance.

- He was judgmental about people

- Very confident about himself and his ideas. Aggressive in his approach to solve a problem and well as put forth his ideas.

- He is rude to people sometimes he thinks are of lesser competence

- Fester thinks that Davenport and Oliver are not competent and he has expressed this to Jerrold. This is creating some division in the team and teamwork is getting affected.

- Challenging the conventional way of problem solving in the lab leading to dispute in the team about fester

- Fester created a perception of himself as a individualist and not a team player