Reinventing the Giant Corporation: The Case of Tata Steel - Diagnosis
Vikalpa: Journal for Decision Makers, Vol. 31, No. 3, pp. 138-142, July-September 2006
Posted: 18 Oct 2006
Tata Steel is presently an EVA + steel company and has a vision to become a dominant player in the global steel industry by entering new markets and developing new enhanced applications of steel. Mr. B Muthuraman, Managing Director of Tata Steel, reviewed the strategic initiatives and performance of the company during the last 15 years in the post-liberalization and globalized Indian environment. During the period 1991-92 to 2004-05, Tata Steel faced many challenges in respect of quality, global cost competitiveness, capacity expansion and modernization, overstaffing, change management and transformation into customer-driven culture, and shift in focus from steel commodity business to Tata Steel brand products. Tata Steel responded proactively to these challenges by way of process innovation, continuous improvement in business processes, employee-friendly HR management practices, creating and spreading new performance-driven culture, and creating value for customers and shareholders. Muthuraman faced the following dilemmas to sustain this high level of growth and identify new value drivers:
Can the company break out of global competition?
Can it consistently be a winner in terms of EVA positive company?
How can it create a blue ocean (Kim and Mauborgne, 2005) and achieve sustained high performance?
What are the strategic options to achieve this and thereby sustain high performance? What are the analytical tools and frameworks that are essential for creating and capturing blue oceans? What are the different paths available before Tata Steel to create blue oceans? How should it build a robust business model to ensure that it makes a healthy profit on its blue ocean idea? What are the organizational hurdles to blue ocean strategy execution and how to break them?
Keywords: SWOT Analysis, Strategic Options, Blue Ocean strategy, Tata Steel
JEL Classification: M10, M14, M30, M40
Suggested Citation: Suggested Citation