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CHAPTER 1

INTRODUCTION

IS SWOT?

It is a planning tool used to identify Strengths, Weaknesses, Opportunities and

Threats involved in a business.

It

is

used as

part of Strategic Planning Process

STRATEGIC PLANNING

Strategic Planning helps an organisation to answer some basic and critical questions like:

  • a) Where we stand?

b)

What

is

our goal?

  • c) How to reach the desired goal?

  • d) How to evaluate performance?

Firstly, what does SWOT stand for?

It

is

an

acronym for

S

stands for Strengths

W

stands for Weaknesses

O

stands for Opportunities

T

stands for Threats

SWOT analysis is an important tool for rapidly establishing the overall strategic position of a business and its environment.

It

is an important

step in helping determine

your business

strategy and so

lead

you

to

your business intelligence strategy.

 

Once

key

issues

have

been

identified,

they

feed

into

business

objectives,

particularly

marketing

objectives

and

Sometimes

you

can

apply

it

to

projects

and

other

ventures.

 

It

is

a very popular

tool

with business and marketing professionals

because it

is quick

and

easy

to

learn.

It

is

subjective though and is best

done

by involving a

good cross

section

of staff

and

external people, so that

you

get as complete

and objective set

of

SWOTs.

 

Strengths and weaknesses are Internal factors.

For example, cash rich or the opposite - large bank overdraft. For example,

People - Skills, Attitude, Training, Knowledge

Products - Quality, Price, Life Cycle

Operations/Production - Capacity, Flexibility

Organisation - Structure, Relationships

Systems - Computer, Databases, Monitoring Dashboards

Finance - Balance sheet, Cash Flow

Reputation - Customer opinion

Opportunities and Threats are External factors. For example,

Economy - Strength of Currency

Market - Growth/Decline, Fashion Trend

Legislation - Pollution, Product Liability, Energy, Healthcare

Technology - Substitutes, New Tools, Artificial Intelligence

Society - Ageing Population

Environment - Recycling, Increased Testing, Protection

Opportunities should be grasped and Strengths built upon and maximised. Threats and Weaknesses should be eliminated or minimised.

An important step in situational analysis, which access your company’s strengths, weaknesses, opportunities, and threats, is

An important step in situational analysis, which access your company’s strengths, weaknesses, opportunities, and threats, is known as SWOT analysis. Strategic situation analysis is divided into two types “Internal analysis” (strengths and weaknesses) and “external analysis” (opportunities and threats). Internal analyses are those factors that are internal to the organization; you can easily control these factors, while external factors are the factors that are outside the organization and affecting you business directly or indirectly.

SWOT analysis is used to analyze: Attributes

of the company that are helpful

to

accomplishing the goals and objectives, attributes of the company that are harmful in achieving the goals, external environment that is useful in accomplishing your company’s goals and objectives and upcoming external condition, which are harmful in achieving your goals and objectives. SWOT analysis is a powerful tool that helps investors to judge, whether, the company is capable enough to achieve different objectives or not. While writing SWOT analysis makes sure, the data you are writing must contain relevant

material.

Strengths:

Strengths are defined as the positive attributes of the organization, which are within the

organization’s control. Such as, specialist marketing and advertising skills, patents, introduction of new and innovative product or service, site of your business, cost benefit through proprietary knowledge, strong reputation, exclusive access to natural resources, quality development and procedures, etc.

Weaknesses:

Factors that are within the organization control and can easily be improved.

It

is

necessary to take care of your weaknesses because these factors can detract you in achieving your goals and objectives. These factors are: lack or advertising and marketing

skills, site of your business, poor quality of

your product and service

(i.e.

in relation to

your competitors), damage reputation, distribution channel, limited resources, etc.

Opportunities:

Opportunities are the external factors that are providing benefit your business directly or

indirectly. Such as, market growth, careful research about market, market size, etc.

Threats:

These are also the external factors, which are not in organization’s control, but they can seriously damage your organization mission. Threats include: competition, economic crises, earthquakes, competition, price war, new regulations, tax policy, etc.

SWOT ANALYSIS MEANING AND

DEFINITION

SWOT ANALYSIS is one of the most used forms of business analysis. A SWOT examines and assesses the impacts of internal strengths and weaknesses, and external opportunities and threats, on the success of the "subject" of analysis. An important part of a SWOT analysis involves listing and evaluating the firms strengths, weaknesses, opportunities, and threats. Each of these elements is described:

  • 1. Strengths: Strengths are those factors that make an organization more competitive than

its marketplace peers. Strengths are what the company has a distinctive advantage at

doing or what resources it has that is strategic to the competition. Strengths

are,

in

effect, resources, capabilities and core competencies that the organization holds that can be used effectively to achieve its performance objectives.

  • 2. Weaknesses: A weakness is a limitation, fault, or defect within the organization that

will

keep it from achieving its objectives; it is what an organization

does poorly or

where it has inferior capabilities or resources as compared to the competition.

  • 3. Opportunities: Opportunities include any favorable current prospective situation in the

organizations environment, such as a trend, market, change or overlooked need that supports the demand for a product or service and permits the organization to enhance its competitive position.

  • 4. Threats: A threat includes any unfavorable situation, trend or impending change in an

organizations environment that is currently or potentially damaging or threatening to its

ability to compete. It

may be a barrier, constraint, or anything that might inflict

problems, damages, harm or injury to the organization.

A firms strengths and weaknesses (i.e., its internal

environment) are made up of factors

over which it has greater relative control. These factors include the firms resources; culture; systems; staffing practices; and the personal values of the firms managers.

Meanwhile, an organizations opportunities and threats (i.e., its external environment) are made up of those factors over which the organization has lesser relative control. These factors include, among others, overall demand, the degree of market saturation,

government

policies,

economic

condition,

social,

cultural,

and

ethical

developments;

technological developments; ecological developments, and the factors making up Porters Five Forces (i.e., intensity of rivalry, threat of new entrants, threat of substitute products,

bargaining power of buyers, and bargaining power of suppliers.)

THREE STAGES OF SWOT ANALYSIS

THREE STAGES OF SWOT ANALYSIS

SWOT

ANALYSIS

HISTORY

-

THE

ORIGINS

OF

THE

SWOT

ANALYSIS

MODEL

This remarkable piece

of

history as

to

the origins

of SWOT analysis

was provided by

Albert S Humphrey, one of the founding fathers of what we know today as SWOT

analysis. I am indebted to him for sharing this fascinating contribution. Albert Humphrey

died on 31 October 2005.

He was

one

of the

good

guys.

SWOT analysis came from the research conducted at Stanford Research Institute from 1960-1970. The background to SWOT stemmed from the need to find out why corporate planning failed. The research was funded by the fortune 500 companies to find out what could be done about this failure. The Research Team were Marion Dosher, Dr Otis Benepe, Albert Humphrey, Robert Stewart, Birger Lie.

It

all began with the corporate planning trend,

which seemed to appear

first

at

Du Pont

in

1949.

By 1960

every Fortune 500

company had

a 'corporate planning manager' (or

equivalent) and 'associations of long range corporate planners' had sprung up in both the

USA and

the UK.

However a unanimous

opinion

developed

in

all

of

these

companies

that

corporate

planning in the shape of long range planning

was not

working, did

not

pay off,

and

was

an expensive investment in futility.

It was widely held that managing change and setting realistic objectives which carry the

conviction

of

those

responsible

was

difficult

and

often

resulted

in questionable

compromises.

The fact remained, despite the corporate and

long range planners,

that the

one

and only

missing link was how to get the management

team

agreed

and

committed

to

a

comprehensive set of action programmes.

To create this

link,

starting in

1960,

Robert F Stewart

at

SRI in Menlo Park California

lead a research team to discover what was going wrong with corporate planning, and

then to

find some

sort of

solution, or to

create a system

for enabling management

teams

agreed and committed to development work, which today we call 'managing change'.

The research carried

on

from

1960

through

1969. 1100 companies and organizations

were interviewed and a 250-item questionnaire was designed and completed by over

5,000 executives. Seven

lead

to

the

conclusion

that

in

corporations chief

executive should be the chief planner and that his immediate functional directors should be the planning team. Dr Otis Benepe defined the 'Chain of Logic' which became the core of system designed to fix the link for obtaining agreement and commitment.

 

1.

Values

2.

Appraise

3.

Motivation

4.

Search

5.

Select

6.

Program

7.

Act

8.

Monitor and repeat

steps

1

2

and

3

We discovered that

we

could not

change

the

values

of

the

team

nor

set

the objectives

for

the

team

so

we

started

as

the

first

step

by

asking

the

appraisal

question,

for

example, what's good and bad about the operation. We began the system

by asking what

is

good

and

bad

about

the

present

and

the

future.

What

is

good

in

the

present

is

Satisfactory, good in the future is an Opportunity;

bad

in

the present

is

a

Fault and

bad

in

the

future is

a Threat.

This was called the

SOFT analysis.

 

When this was

presented

to

Urick

and

Orr

in

1964

at

the

Seminar

in

Long

Range

Planning at

the

Dolder

Grand

in

Zurich

Switzerland

they changed

the

F

to

a

W

and

called it SWOT Analysis.

 

SWOT was then promoted in

Britain by Urick and

Orr

as

an

exercise in

and

of

itself.

As such

it

has no benefit. What

was

necessary was

the

sorting

of

the

issues

 

into the

programme planning categories of:

 
 

1.

Product (what are we selling?)

 

2.

Process (how are we selling it?)

3.

Customer (to whom are we selling it?)

 

4.

Distribution (how does it reach them?)

5.

Finance (what are the prices, costs and investments?)

 

6.

Administration (and how do we manage all this?)

The second step then becomes

'what shall the

team

do' about

the

issues in

each

of these

categories. The planning process was then designed through trial and error and resulted

finally

in

a

17

step

process

beginning

with

SOFT/SWOT

with

each

issue

recorded

separately on a single

called a planning issue.

 

The first

prototype

was

tested

and

published

in

1966

based

on

the

work

done

at

'Erie

Technological

Corp'

in

Erie

Pa.

In

1970

the

prototype

was

brought

to

the

UK,

under the sponsorship

of

W

H

Smith

&

Sons

plc,

and

completed

by

1973.

The

operational programme was used to merge the CWS milling and baking operations with

those of J W French Ltd.

The process has been

used successfully ever

since.

By 2004,

now, this system

has been

fully developed, and proven to cope with today's problems of setting and agreeing

realistic annual objectives resources.

without

depending

on

outside

consultants

or

expensive staff

SIMPLE RULES FOR SUCCESSFUL SWOT ANALYSIS:

Be realistic about the strengths and weaknesses of your organization when

conducting SWOT analysis. SWOT analysis should distinguish between where your organization is today, and

where it

could

be

in the future.

SWOT should always be specific. Avoid grey areas.

Always apply SWOT in relation to your competition i.e. better than or worse than

your competition. Keep your SWOT short and simple. Avoid complexity and over analysis

SWOT analysis is subjective.

Once key issues have been identified with your SWOT analysis, they feed into marketing objectives. SWOT can be used in conjunction with other tools for audit and analysis, such as PEST analysis and Porter's Five-Forces analysis. So SWOT is a very

popular tool with marketing students because it is quick and easy to SWOT exercise, list factors in the relevant boxes. It's that simple.

learn. During the

finally in a 17 step process beginning with SOFT/SWOT with each issue recorded separately on aPEST analysis and Porter's Five-Forces analysis. So SWOT is a very popular tool with marketing students because it is quick and easy to SWOT exercise, list factors in the relevant boxes. It's that simple. learn. During the 7 " id="pdf-obj-8-270" src="pdf-obj-8-270.jpg">

7

THE REAL SWOT:

SWOT as taught is today’s business schools is little more than Scientific Wild Ass Guess (SWAGs) according to Cranfield’s Professor Malcolm McDonald. He makes the

point that many threats are the same regardless of the business environment that is being

audited. For example, common-all-garden threats would include the weather, competitors, changes in technology, regulation and deregulation, and the impacts of competing

countries. In strengths you’ll get good products but that could mean anything. Under

weaknesses

you get equally general

and

vacuous points such as the

price is

too high.

 

This type of SWOT analysis

is

too

general and is

not much use to marketing managers.

SWOT needs to be segment specific. SWOT should look at groups of customers and

 

their perception of

your brand, what

price they will

pay, the

place where they buy it,

the products

that

they buy and

so

on.

Otherwise your SWOT analysis is averaged and

not specific.

SWOT analysis should be focused upon

a segment of the market. Then

you

can

ask

what are the Critical Success Factors(CSFs) that are pivotal to the buyer decision process

in that segment?

Then

you

need

to

weight

the CSFs

so that

you can separate those

drivers that are most important. When considering strengths and weaknesses, in true marketing fashion you need to take the consumers’ perspective when completing the

SWOT. You

also

must factor

in

the

customers’ view of

your business in relation to the

competition i.e. relative to competitors. So you can match key CSFs to opportunities. You can rank those opportunities that are most profitable or sustainable. Then you need

to

factor in the impact

of threats.

your strategic thinking.

Finally you should dovetail SWOT with the rest of

ADVANTAGES AND DISADVANTAGES

THE REAL SWOT: SWOT as taught is today’s business schools is little more than Scientific Wildenvironment that is being audited. For example, common-all-garden threats would include the weather, competitors, changes in technology, regulation and deregulation, and the impacts of competing countries. In strengths you’ll get good products – but that could mean anything. Under weaknesses you get equally general and vacuous points such as the price is too high. This type of SWOT analysis is too general and is not much use to marketing managers. SWOT needs to be segment specific. SWOT should look at groups of customers and their perception of your brand, what price they will pay, the place where they buy it, the products that they buy and so on. Otherwise your SWOT analysis is averaged and not specific. SWOT analysis should be focused upon a segment of the market. Then you can ask – what are the Critical Success Factors(CSFs) that are pivotal to the buyer decision process – in that segment? Then you need to weight the CSFs so that you can separate those drivers that are most important. When considering strengths and weaknesses, in true marketing fashion you need to take the consumers’ perspective when completing the SWOT. You also must factor in the customers’ view of your business in relation to the competition i.e. relative to competitors. So you can match key CSFs to opportunities. You can rank those opportunities that are most profitable or sustainable. Then you need to factor in the impact of threats. your strategic thinking. Finally you should dovetail SWOT with the rest of ADVANTAGES AND DISADVANTAGES The small business owner's challenge is to create products and services the customer values and the means to produce and deliver those products and services in ways that are exceptional compared to the competition. To address these challenges, a company must define business objectives and address operational issues based on its current situation and the factors that impact its financial and operational goals. Such decision-making processes are frequently supported by structured brainstorming, which, in turn, can be supported by a Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis. " id="pdf-obj-9-173" src="pdf-obj-9-173.jpg">

The small business owner's challenge is to create products and services the customer values and the means to produce and deliver those products and services in ways that are exceptional compared to the competition. To address these challenges, a company must define business objectives and address operational issues based on its current situation and the factors that impact its financial and operational goals. Such decision-making processes are frequently supported by structured brainstorming, which, in turn, can be supported by a Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis.

The advantages of the SWOT methodology, such as its appropriateness to address a variety of business issues, make it a desirable tool to support some brainstorming sessions. However, the tool's disadvantages, such as the subjective analysis of an issue, make it less desirable for others.

SWOT Analysis Application

The SWOT method is not a process in itself, such as strategic planning, opportunity analysis or competitive analysis. Instead it's a tool used to structure a particular brainstorming session. As a result, a problem or process that's addressed using the

SWOT tool may itself

be thought

of

in

terms

of phases

or

a life cycle. For example,

strategic planning is a process consisting of multiple steps or phases. However, the

SWOT analysis, like a brainstorming session,

is

simply a tool

that

may be used

one or

more times

to gain

a collection of ideas regarding a particular issue or problem. For

example, a business determines on each occasion, if a brainstorming session is

 

appropriate to address a strategic plan or competitive analysis. If so, the business then

decides if it

will

use the SWOT method or an alternative tool to facilitate the session.

Advantage: Problem Domain

SWOT analysis can be applied to an organization, organizational unit, individual or team. In addition, the analysis can support a number of project objectives. For example, the SWOT method can be used to evaluate a product or brand, an acquisition or partnership, or the outsourcing of a business function. In addition, SWOT analysis can be beneficial in evaluating a particular supply source, a business process, a product market or the implementation of a particular technology.

Advantage: Application Neutrality

SWOT analysis is conducted by specifying an objective and conducting a brainstorming session to identify internal and external factors that are favorable and unfavorable to the objective's achievement. This approach remains the same whether the analysis is used to support strategic planning, opportunity analysis, competitive analysis, business development or product development processes.

Advantage: Multi-Level Analysis

Valuable information about your objective's chances can be gained by viewing each of the four elements of the SWOT analysis -- strengths, weaknesses, opportunities and threats -- independently or in combination. For example, identified threats in the business environment, such as new government regulations regarding a product design or the introduction of competing products, might alert the business owner that a proposed investment in a new manufacturing production line should be more carefully evaluated. In addition, an awareness of a company weakness such as a lack of qualified employees might suggest a need to consider outsourcing particular functions. In turn, opportunities such as the availability of low-interest loans for startups might encourage the entrepreneur to pursue the development of a new product to meet a rising customer demand. In contrast, identified strengths, such as extensive experience in an industry experiencing rapid international growth, might suggest the need to partner with foreign companies.

Advantage: Data Integration

SWOT analysis requires that quantitative and qualitative information from a number of sources be combined. Access to a range of data from multiple sources improves enterprise-level planning and policy-making, enhances decision-making, improves communication and helps to coordinate operations.

Advantage: Simplicity

SWOT analysis requires neither technical skills nor training. Instead, it can be performed by anyone with knowledge about the business in question and the industry in which it operates. The process involves a facilitated brainstorming session during which the four dimensions of the SWOT analysis are discussed. As a result, individual participants’ beliefs and judgments are aggregated into collective judgments endorsed by the group as a whole. In this way, the knowledge of each individual becomes the knowledge of the group.

Advantage: Cost

Because SWOT analysis requires neither technical skills nor training, a company can

select a staff member to conduct the analysis rather than hire an external consultant. In

addition, SWOT is a somewhat time.

simple method that can be performed

in

a fairly short

SWOT Analysis is instrumental in strategy formulation and selection. It is a strong tool,

but

it involves

a great

subjective element.

It

is

best

when used as

a guide,

and not

as

a

prescription. Successful businesses build on their strengths, correct their weakness and protect against internal weaknesses and external threats. They also keep a watch on their overall business environment and recognize and exploit new opportunities faster than its competitors.

SWOT Analysis helps in strategic planning in following manner-

  • a. It is a source of information for strategic planning.

  • b. Builds organization’s strengths.

  • c. Reverse its weaknesses.

  • d. Maximize its response to opportunities.

  • e. Overcome organization’s threats.

  • f. It helps in identifying core competencies of the firm.

  • g. It helps in setting of objectives for strategic planning.

  • h. It helps in knowing past,

present

and

future so

that by using past

and current

data, future plans can

be chalked out.

 

SWOT Analysis provide information that helps in synchronizing the firm’s resources and capabilities with the competitive environment in which the firm operates.

.

Disadvantage: No Weighting Factors

SWOT analysis leads to four individual lists of strengths, weaknesses, opportunities and threats. However, the tool provides no mechanism to rank the significance of one factor

versus another

within any list.

can't be determined.

As

a result,

any one

factor's true impact

on the objective

Disadvantage: Ambiguity

SWOT analysis creates a one-dimensional model in which each problem attribute is

viewed as a strength,

weakness, opportunity or threat. As a result, each attribute is seen

to have only one influence on the problem being analyzed. However, one factor might

be both

a strength

and

a weakness. For example, locating a chain of

stores on well-

traveled streets that grant easy access to customers might be reflected in increased sales.

However, the costs of operating high-visibility facilities can make it difficult to compete on price without a large sales volume.

Disadvantage: Subjective Analysis

To significantly impact company performance, business decisions must be based on reliable, relevant and comparable data. However, SWOT data collection and analysis entail a subjective process that reflects the bias of the individuals who collect the data and participate in the brainstorming session. In addition, the data input to the SWOT analysis can become outdated fairly quickly.

SWOT Analysis is not free from its limitations. It may cause organizations to view circumstances as very simple because of which the organizations might overlook certain

key strategic

contact

which

may

occur.

Moreover,

categorizing

aspects

as

strengths,

weaknesses, opportunities and threats might be very subjective as there is great degree of

uncertainty in market.

SWOT

Analysis

does

stress

upon

the

significance

of

these four

aspects, but it does not tell how an organization can identify these aspects

for itself.

There are certain limitations of SWOT Analysis which are not in control of management. These include-

  • a. Price increase;

  • b. Inputs/raw materials;

  • c. Government legislation;

  • d. Economic environment;

  • e. Searching a new market to import restrictions; etc.

for the product which

is not having overseas

market due

Internal limitations may include-

  • a. Insufficient research and development facilities;

  • b. Faulty products due to poor quality control;

  • c. Poor industrial relations;

  • d. Lack of skilled and efficient labour; etc

CHAPTER 2

INTRODUCTION OF TATA MOTORS

Established under the parent company, Tata Group, in 1945, Tata Motors Limited

has become India s largest

automobile company. It was the first Indian automobile

company to list

on

the

New

York

Stock

Exchange.

Tata

Motors

began

manufacturing

commercial vehicles

in 1954

with

a

15-year collaboration

agreement

with

Daimler

Benz

of

Germany.

 

This partnership has led Tata Motors to not only become Indias largest automobile

 

company but also India s largest commercial vehicle manufacturer; the worlds top five

manufactures of

medium

and

heavy

trucks

and

the

worlds

second

largest

 

medium

and

heavy

bus manufacturer.

 

Having

just

entered

the

passenger

vehicles

market

segment

in

1991,

Tata Motors now ranks second in India s passenger vehicle market. Tata has enjoyed the prestige of having developed Tata Ace, India s first indigenous light commercial vehicle; Tata Safari, India s first sports utility vehicle; Tata Indica, Indias first indigenously manufactured passenger car; and the Nano, the world s least expensive car. Tata Motors Limited (Tata Motors or “the company”) is an automotive vehicle manufacturing company based in India.

The company is engaged in the development, design, manufacture and assembly,

sale, and financing of vehicles,

as well

as

sale of auto parts and accessories.

The company primarily operates in India, South Korea, South Africa, Thailand,

Bangladesh, Singapore, Spain, and the UK.

The company is headquartered in Mumbai, India and employs about 52,244 people, including approximately 26,030 permanent employees.

The company recorded revenues of INR1,232,134.1 million ($26,860.5 million) during the financial year ended March 2011 (FY2011), an increase of 33% over FY2010. The operating profit of the company was INR48,998.6 million ($1,068.2 million) during FY2011, as compared to an operating loss of INR7,175 million ($156.4 million) in

FY2010.

The net profit was INR73,401.8 million ($1,600.2 million) in FY2011, an increase of 93% over FY2010

CHAPTER 3

SWOT ANALYSIS OF TATA MOTORS:

SWOT analysis (alternately SLOT analysis)

is

a

strategic

planning

method

used

to

evaluate the Strengths, Weaknesses/Limitations, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favourable and unfavourable to achieve

that objective.

CHAPTER 3 SWOT ANALYSIS OF TATA MOTORS: SWOT analysis (alternately SLOT analysis) is a strategic planning
CHAPTER 3 SWOT ANALYSIS OF TATA MOTORS: SWOT analysis (alternately SLOT analysis) is a strategic planning

14

STRENGTHS:

1.

Strong Domestic player

(Indian

market):

Tata has

a strong presence

in

India

and is a key manufacturer of commercial vehicles. It is a market share of ~64%

which has almost remained constant. Also, Tata Motors is India‟s largest

automobile manufacturer by revenue .Tata Motors Limited is

India‟s

largest

automobile company,

with revenues of `1,23,133.30 crore in 201011.

It

is

the

leader in commercial vehicles in each segment, and among the top three in

passenger vehicles in India with products in the compact, midsize car and utility

vehicle segments. Tata vehicles are sold primarily in

India, and

over

4

million

Tata vehicles have been produced assembled in 1954.

domestically since the first Tata vehicle was

STRENGTHS: 1. Strong Domestic player (Indian market): Tata has a strong presence in India and is

It

is

a

demand

driven,

and

customer-oriented,

taking

care

of

customers‟

preferences and taste.

 
 

Long list of portfolios: Its products include passenger cars, trucks, vans and

 
 

coaches.

It is world‟s

4th biggest truck producer, it is also world‟s second

 

biggest bus producer. The internationalisation strategy so far has been to keep

 

local managers in new acquisitions, and to only transplant a couple of senior

managers from

India

into

the new

market.

The benefit

is

that

Tata has been able

to exchange expertise. For example after the Daewoo acquisition the Indian company leaned work discipline and how to get the final product 'right first time.'

The company has

a

strategy in

place

for the

next stage of its expansion. Not

 

only is

it focusing

upon new products and

acquisitions, but

it

also

has

a

programme of intensive management development in place in order to establish its

leaders for tomorrow.

 

The company has

had a successful alliance with

Italian mass producer Fiat since

2006. This

has

enhanced

the

product

portfolio

for Tata

and

Fiat

in

terms

of

production and knowledge exchange. For example, the Fiat Palio Style was

launched by Tata in

2007, and the

companies have an agreement to build a pick-

up targeted at Central and South America

 Global Presence : Tata Motors has been in the process of acquiring foreign brands to

Global Presence :Tata Motors has been in the process of acquiring foreign brands

to

increase

its

global

presence.

Through

acquisition,

Tata

has

operations

in

the

UK, South Korea, Thailand and Spain. Among these acquisitions is Jaguar Land Rover, a business comprising two strugglingiconic British brands that was acquired from the Ford Motor Company in 2008. In 2004, Tata acquired the Daewoo Commercial Vehicles Company, South Korea‟s second largest truck maker. Today two-thirds of heavy commercial vehicle exports out of South Korea are from Tata Daewoo. Tata Motors has expanded its production and assembly operations to several other countries including South Korea, Thailand, South Africa and Argentina and is planning to set up plant sin Turkey, Indonesia and Eastern

Europe.Tata also has franchisee/joint venture assembly operations in Kenya,

Bangladesh, Ukraine,Russia and Senegal. Tata has dealerships across 4 continents.

in

26

countries

Dealership, Sales and Service Access:

 

The Company‟s dealership, sales, services and spareparts network comprises over 3500 touch points.

Research and Development Activities: Tata motors is known as an innovative global leader. The company has a very strong R&D having over 3000 engineers and scientists. The Engineering Research Centre (ERC) in Pune was setup in

1966

and

is

among the

finest in the country.

It has been honoured

with two

prestigious awards - 'The DSIR National Award for R&D Effort in Industry - 1999' and'National Award for Successful Commercialisation of Indigenous Technology by an IndustrialConcern - 2000.' Tata Nano was a recent outcome

 

from the ERC

.

The Nano is Tata’s iPod. Great engineering and design in a rules-breaking product that has generated global awareness and admiration

The brand is very well established in the economy segment

Tata’s management is strengthened by the collective experience of its partners and acquired companies this includes general management, marketing, sales and operations

Tata’s buying power is enhanced and leveraged through its size

Tata is making smart acquisition and partnering decisions so far. Local management teams remain in place vs. installing Tata leaders from afar. 1+1 = 3 seems to be working so far

  • International strategy - about new acquisitions, Tata added some of senior managers

in the new companies

or market. The

benefit is that

Tata Motors is able to exchange

the expertise. Also

by

doing

that

the

new

company

will

do’t

need

to

setup new

managerial post and company can run as per the old settings.

  • Name-Tata Motors has a strategy to

Brand

work with

the old

name of the company

which Tata bought or

acquires

that does

not

effect

the brand

value. Tata

is

doing

this

because

tata

is

new

in

International

market

and

people

outside

india

do

not

know about Tata Motors. For example:- Tata acquired Land Rover and Jaguar from Ford and now Tata is running these companies but Tata did not add Tata Name in

to These luxury brand,

that is

giving more stability of these brands in the market.

  • Globalization- The company has a strategy to expand its network in world wide and company already started by expanding its networks to South Africa, China, UK, South Korea,Brazil and many others countries.

  • Domestic Strategy-

Strategy for local

market

customers and

new costumers

-

Tata

Motors is most trusted vehicle brand in

India,

and

Tata

is

putting

effort

to

be

in

same position by fulfilling the commitment done by company.

 
  • R&D-Tata Motors

put emphasize on R&D,

and

developed some

of

the

very useful

machine for indian market for example- Tata Safari- India first sport utility

vehicle,Tata

Nano-

World

cheapest

car, Tata

Ace-

Indias

first

mini

transport

 

utility

vehicle, Tata

Indica V2- Car

that is

most fuel

efficient in Indian Market. Tata is also

working for Compressed

air

car-

Motor

Development

International

of

France

has

developed the worlds first prototype of Compressed air car Named OneCat.

 
  • Financial-Tata

Motors

is

a

part

of

Tata

groups

of

companies

that

has

vey

strong

financial position.

 
  • Employment-Tata

Motors

is

a

big

company

that

provides

jobs

to

the

unemployed

people.Tata Motors is

known for good employee management that

make it

some of

the best

choice for work. That

attracts the people and also

increases

the

popularity of

company.

WEAKNESS:

  • 1. Return on Investment on TATA motors shares in low.

  • 2. Tata motors products are not considered as luxurious.

  • 3. The products are generally targeted for economy class

WEAKNESS: 1. Return on Investment on TATA motors shares in low. 2. Tata motors products are
  • 4. rather than for luxury. Hence, the company lacks a

  • 5. strong footprint in the sector of luxury products.

  • 6. Safety standards are not maintained/ often ignored.

  • 7. This has led to diminish of public image of the TATA

  • 8. automobiles (eg Tata Nano)

  • 9. Limited consumer base.

    • 10. Though Tata is present in many countries it has only managed to create a large consumer

    • 11. base in the Indian Subcontinent, namely India, Bangladesh, Bhutan, Sri Lanka and Nepal.

    • 12. Tata has a growing consumer base in Italy, Spain and South Africa.

    • 13. Relatively smaller proportion of market share in Passenger vehicles in India.

    • 14. Tata Motors is not well positioned in the luxury segment. This is not a problem during recessionary times but a lack of diversification can hurt during better times Most of the automobiles Tata manufactures are based on older platforms The Company’s manufacturing practices trail competitors.

    • 15. One weakness which is often not recognized is that in English the word 'tat' means rubbish.

    • 16. Would the brand sensitive British consumer ever buy into such a brand?

    • 17. The company's passenger car products are based upon 3rd and 4th generation platforms,

19. The company's passenger car products are based upon 3rd and 4th generation platforms, which put Tata Motors Limited at a disadvantage with competing car

manufacturers. 20. Despite buying the Jaguar and Land Rover brands (see opportunities below); Tata

has not

got

a

foothold in the luxury car segment in its domestic,

Indian market.

Is

the brand associated with commercial vehicles and low-cost passenger cars to the

extent that it has isolated itself from lucrative segments in a more aspiring India?

21. One weakness which is

often not recognised

is

that in

English the word 'tat'

means rubbish. Would the brand sensitive British consumer ever buy into such a

brand? Maybe not, but

they would buy into Fiat, Jaguar and

Land Rover (see

opportunities and strengths).

Less

Luxury-Tata

as

a

international

brand,

do

not

produce

luxury

vehicles

for

domestic market. That is a disadvantage for

company to

competing with

other Car

makers in domestic market.

 

Safety-Tata

Motors

do

not

provide

standerd

safety

features

in

their

vehicles

in

domestic market.

 

Sells

-Tata

Nano

the

peoples

cars

sells

in

continue

decreasing

 

that

is

also

world

cheapest

car.

The main reason

behind

this

is

lack of security features

in

car

as

well

as

car

is

not made

to drive

in Highway.

This

car

is

made to attract

for those

people

who wants

to

use

it

in city.

Wrong Advertisement-Company is lacking in advertisement of their brand and Media is focusing companies failures about Tata Nano now days. Company also started monthly payment system for Tata Nano that is 99rupee (14 SEK) per month that is cheaper then the mobile subscription per mont. That is developing negative phycology about Nano in people.

OPPORTUNITY:

  • 1. In the summer of 2008 Tata Motor's announced that it had successfully purchased the

Land Rover and Jaguar brands from

Ford

Motors for

UK £2.3

million.

Two of

the

World's

luxury

car

brand

have

been

added

to

its

portfolio

of

brands,

and

will

undoubtedly off the company the chance to market vehicles in the luxury segments.

  • 2. Tata Motors Limited acquired Daewoo Motor's Commercial vehicle business in 2004 for around USD $16 million.

  • 3. Nano is

the cheapest

car

in

the

World -

retailing at little

more than

a motorbike.

Whilst the

World is getting ready for greener alternatives to gas-guzzlers,

is

the

Nano

the

answer

in

terms

of concept

or brand?

Incidentally,

the

new

Land

Rover and Jaguar models

will

cost

up

to

85

times more than a standard Nano!

track

platform is

about to

be launched from

its Korean

(previously

  • 4. The new global Daewoo) plant.

Again,

at

a

time

when

the

World

is

looking

for

environmentally

friendly transport alternatives, is now the

right

time to

move into

this

segment?

The

answer

to

this

question

(and

the

one

above)

is

that

new

and

emerging

industrial

nations such

as

India,

South

Korea

and

China

will

have

a

thirst

for

low-cost

passenger

and

commercial

vehicles.

These

are

the

opportunities.

However

the

company

has

put

in

place

a

very

proactive

Corporate

Social

Responsibility

(CSR)

committee

to

address

potential

strategies

that

will

make

is

operations

more

sustainable.

  • 5. fuel

The range

of

Super

Milo

efficient

buses

are

powered

by

super-efficient,

eco-

friendly engines. The

bus has optional

organic clutch with booster assist

and better

air intakes that will reduce fuel consumption by up to 10%.

  • 6. The Nano could sell well in other geographic markets. Expanding markets such as China may find the Nano just the answer

  • 7. Jaguar and Land Rover provide Tata with an opportunity to establish itself in the luxury segment

  • 8. In the summer of 2008 Tata Motor's announced that it had successfully purchased the Land Rover and Jaguar brands from

Ford Motors for UK £2.3

million. Two of the

World's luxury car brand have been added to its portfolio of brands,

and will

undoubtedly off the company the chance to market vehicles in the luxury segments.

9.

Tata Motors Limited acquired Daewoo Motor's Commercial vehicle business in 2004 for around USD $16 million.

  • 10. - Whilst the World is getting ready for greener alternatives to gas-guzzlers, is the Nano

Nano is

the cheapest

car

in the World

retailing at

little more than

a motorbike.

the answer in terms of concept or brand? Incidentally, the new Land Rover and

Jaguar models will cost

up

to

85

times more than a standard

Nano!

 
  • 11. The new global track platform is about to be launched from its Korean (previously Daewoo) plant. Again, at a time when the World is looking for environmentally friendly transport alternatives, is now the right time to move into this segment? The

answer

to

this question (and the one

above) is

that new and emerging industrial

nations such as

India,

South Korea and China

will

have a thirst

for

low-cost

passenger and commercial vehicles. These are the opportunities. However the company has put in place a very proactive Corporate Social Responsibility (CSR) committee to address potential strategies that will make is operations more sustainable.

  • 12. The range of Super Milo fuel efficient buses are powered by super-efficient, eco- friendly engines. The bus has optional organic clutch with booster assist and better air intakes that will reduce fuel

consumption by up to 10%.

  • 13. Demography - According to indexmundi.com, 64.9% of the India population is between 15

and 64

years

which,

in

other words, states that over 700

legal candidates to

have

a

car.

This number is growing.

million are

  • 14. Political - According to The Economic Times “the government is aiming to spend $1 trillion on infrastructure development by 2017”. This can only be interpreted as a political willpower to help the country’s wellbeing. A healthy country is a low-risk- to-invest country.

16. Social

- Times

of

India published the following on September 15 th , 2010: “…

Indian

women demonstrate stratospheric levels of aspiration – 76 per cent… aspire to a top

job… 85 per cent of Indian women consider themselves “very ambitious,”…”. This boosts the number of potential clients. Environmental trends are also an opportunity on which the company is already taking advantage.

THREATS:

  • 1. Other competing car manufacturers have been in the passenger car business for 40, 50 or more years. Therefore Tata Motors Limited has to catch up in terms of quality and lean production

  • 2. Environmental Regulation: Sustainability and environmentalism could mean extra costs for this low-cost producer. This could impact its underpinning competitive advantage. Obviously, as Tata globalizes and buys into other brands this problem could be alleviated.

  • 3. Intense competition: Since the company has focused upon the commercial and small vehicle segments, it

has

left itself open to competition from

overseas

companies for

the emerging Indian luxury segments. For example ICICI bank and DaimlerChrysler have invested in a new Pune-based plant which will build 5000 new Mercedes-Benz

per annum. Other players developing luxury cars targeted at the Indian market include Ford, Honda and Toyota. In fact the entire Indian market has become a target for other global competitors including Maruti Udyog, General Motors, Ford and

others. Presently,

Tata

Motors face intense

competition from its domestic as well

as

foreign competitors including General Motors, Honda Motor, Maruti Udyog,

Mitsubishi Motors, Fiat, Ford and so on. Competition is expected to intensify further as Indian automobile manufacturers obtain greater access to debt and equity financing

in

the

international

capital

markets

or

gain

access

to

more

advanced technology

through alliances. Additionally, in recent years, the government of India has permitted automatic approvals for foreign equity ownership of up to 100% in entities

manufacturing vehicles and components in India Rising cost of manufacturing: Rising prices in the global economy could pose a threat to Tata Motors Limited on a couple of fronts. The price of steel and

aluminum is increasing

putting pressure on

the costs

of production. Many of Tata's

products run on Diesel traditional home market.

fuel

which

is

becoming

expensive

globally

and

within

its

  • 4. Low safety standards can hamper the prove fatal to its domestic market.

public trusts it has already attained which

may

  • 5. Powerful competitors for the luxury market including Honda, Toyota, Ford and Mercedes- Benz are beginning to push into the Indian market

  • 6. Tata’s competitive price advantage will be under pressure as environmental regulations are tightened

8.

There is a trending rise in diesel fuel costs which will hurt Tata’s line of products

One of the conclusions I’ve reached in my SWOT analysis of Tata Motors is that the company has done of a very good job in the past five years of strengthening its position in the market. It appears to have an excellent opportunity for future success but like all businesses, faces significant challenges.

  • 9. Other competing car manufacturers have been in the passenger car business for 40, 50

or more

years. Therefore Tata Motors Limited has to catch up in

and lean production.

terms of quality

Sustainability and environmentalism could mean extra costs for this low-cost producer. This could impact its underpinning competitive advantage. Obviously, as Tata globalises and buys into other brands this problem could be alleviated.

10. Since the company has focused upon the commercial and small vehicle segments, it has left itself open to competition from overseas companies for the emerging Indian luxury segments. For example ICICI bank and DaimlerChrysler have invested in a new Pune-based plant which will build 5000 new Mercedes-Benz per annum. Other players developing luxury cars targeted at the Indian market include Ford, Honda and

Toyota.

In

fact the entire

Indian market has become a target for other global

competitors including Maruti Udyog, General Motors, Ford and others.

Rising prices in the

global economy could pose a threat to Tata Motors

Limited on a

couple of fronts. The price of steel and aluminium is increasing putting pressure on

the costs of production.

Many of

Tata's

products run

on

Diesel fuel which is

 

becoming expensive globally and within its traditional home market.

 

11. Demography

-

The

population

increase

rate

might

cause

problems

such

as

unemployment and emigration. This could affect the number potential customers.

12. Economy

fast

growing

competitors.

time, high demand of products could bring inflation that affects the company’s

A

economy

could

mean

more

At

the

same

potential clients budged. The following statement was taken from bbc.co.uk: “Raging

inflation and a gradual increase in borrowing costs has dampened domestic demand,

alongside lackluster investment sentiment,” said Radhika Rao of Forecast Pte

13. Political - Some projects for public transportation are been develop. Projects such as Sustainable Urban Transport (see web.worldbank.org) include cities like Pune and Pimpri-Chinchwad (in Maharashtra), Naya Raipur (in Chhattisgarh), Jalandhar (in Punjab), Indore (in Madhya Pradesh), and Mysore (in Karnataka).

Technology - Technology research and usage always involves investment which might not always give the desired outcome.

14. Social - Times of India (timesofindia.com) states the following:

“…

more than half

of Indian women experience pressure from their spouses and in-laws to quit working when they get married… 52 per cent of Indian women were criticized for continuing their career”. This on the other hand decreases the number of potential clients.

CHAPTER 4 RESEARCH METHODOLOGY

MORE

ON

THE

DIFFERENCE

AND

RELATIONSHIP

BETWEEN

PEST

AND

SWOT:

There is some overlap between

PEST and SWOT. Similar factors appear in

each. That

said, PEST and SWOT are certainly two different perspectives:

PEST tends to assess a market, including competitors, from the standpoint of a particular proposition or a business.

SWOT in business

and

marketing

tends

to

be

an

assessment

of

a

business

or

a

proposition, whether it is your own business or (less commonly) a competitors business

or proposition.

Strategic planning is

precise

science

tool

mandatory

- pragmatic choice as to what helps best to identify and explain the issues.

-

not

a

no

is

its

a

matter

of

PEST analysis may useful before SWOT analysis

where

it

helps

to

identify

SWOT

factors. Alternatively PEST analysis may be achieve the same effect.

incorporated

within

a

SWOT

analysis,

to

PEST becomes more useful and relevant the

larger and more complex

proposition, but

even

for

a

very small

local businesses a PEST analysis

the business or can still throw

up one or two very significant issues that might otherwise be missed.

The four quadrants in PEST vary in significance depending on the type of business, for example, social factors are more obviously relevant to consumer businesses or a B2B (business-to-business) organization close to the consumer-end of the supply chain, whereas political factors are more obviously relevant to a global munitions supplier or aerosol propellant manufacturer.

All businesses benefit from a SWOT analysis, and all businesses benefit from completing a SWOT analysis of their main competitors, which interestingly can then provide useful points back into the economic aspects of the PEST analysis.

CHAPTER 5

SWOT

ANALYSIS

MATRIX

-

IN

BUSINESS/MARKETING

-

INTERNAL

V

EXTERNAL FACTORS:

Modern SWOT analysis in business and marketing situations is normally structured so that a 2x2 matrix grid can be produced, according to two pairs of dimensions.Strengths and Weaknesses, are 'mapped' or 'graphed' against Opportunities and Threats. To enable

this to happen cleanly and clearly, and from

a logical point of view anyway when

completing a SWOT analysis in most business and marketing situations, Strengths and

Weaknesses are regarded distinctly as internal factors, whereas Opportunities and Threats are regarded distinctly as external factors.

CHAPTER 5 SWOT ANALYSIS MATRIX - IN BUSINESS/MARKETING - INTERNAL V EXTERNAL FACTORS: Modern SWOT analysis

Strengths

and

the internal environment

for

example,

factors

relating

factors

 

tend

Weaknesses

- the situation inside the

to

products,

pricing,

costs,

to

be

in

the

company or organization

profitability,

performance,

present

 

quality,

people,

skills,

 

adaptability,

brands,

services,

reputation, infrastructure, etc.

processes,

Opportunities

 

the

external

environment

for

example,

factors

relating

factors

tend

and Threats

-

the

situation

outside

to

markets,

sectors,

audience,

to

be

in

the

 

the

company

or

fashion,

seasonality,

trends,

future

 

organization

competition,

economics,

 
 

politics,

society,

culture,

technology, media, law, etc.

environmental,

SWOT ANALYSIS - DIFFERENT APPLICATIONS:

 

SWOT analysis

is

a

powerful

model

for many different

situations. The SWOT

tool

is

not just for business

and marketing. Here are some examples of what a SWOT analysis

can

be used

to

assess:

a company (its position in the market, commercial viability, etc)

 

a method of sales distribution

a product or brand

a business idea

a strategic option, such

as

entering a new

market or launching a new

product

a opportunity to make an acquisition

a potential partnership

changing a supplier

outsourcing a service, activity or resource

project planning and project management

an investment opportunity

personal financial planning

personal career development - direction, choice, change, etc.

education and qualifications planning and decision-making

life-change - downshifting, relocation,

relationships, perhaps even family planning? ..

Whatever the application, be sure to describe the subject (or purpose or question) for the SWOT analysis clearly so you remain focused on the central issue. This is especially crucial when others are involved in the process. People contributing to the analysis and seeing the finished SWOT analysis must be able to understand properly the purpose of the SWOT assessment and the implications arising.

Subject of SWOT analysis: (define the subject of the analysis here)

 
 

strengths

weaknesses

Advantages of proposition?

Disadvantages of proposition?

Capabilities?

Gaps in capabilities?

Competitive advantages?

Lack of competitive strength?

USP's (unique selling points)?

Reputation, presence and reach?

Resources, Assets, People?

Financials?

Experience, knowledge, data?

Own known vulnerabilities?

Financial reserves, likely

Timescales, deadlines and

returns? Marketing - reach, distribution,

pressures? Cashflow, start-up cash-drain?

awareness?

Continuity, supply chain

Innovative aspects?

robustness?

Location and geographical?

Effects on core activities,

Price, value, quality?

distraction?

Accreditations, qualifications,

Reliability of data, plan

certifications? Processes, systems, IT,

predictability? Morale, commitment, leadership?

communications?

Accreditations, etc?

Cultural, attitudinal, behavioural?

Processes and systems, etc?

Management cover, succession?

Management cover, succession?

Opportunities

threats

Market developments?

Political effects?

Legislative effects?

 

Competitors' vulnerabilities?

Environmental effects?

Industry or lifestyle trends?

IT developments?

Technology development and

Competitor intentions - various?

innovation?

Market demand?

 

Global influences?

New technologies, services,

New markets, vertical,

horizontal?

ideas? Vital contracts and partners?

Niche target markets?

Obstacles faced?

Geographical, export, import?

Insurmountable weaknesses?

Market need for new USP's?

Employment market?

Market response to tactics, e.g.,

Financial and credit pressures?

surprise?

Economy - home, abroad?

 

Major contracts, tenders?

Business and product

Seasonality, weather effects?

development? Information and research?

 

Partnerships, agencies,

distribution?

Market volume demand trends? Seasonal, weather, fashion influences?

CHAPTER 6

CONCLUSION

 

Strengths

 
 

weaknesses

 

End-user sales control and direction.

 

Right products, quality and

Customer lists not tested.

reliability.

Some gaps in range for certain

Superior product performance vs competitors.

sectors.

We would

be

a

small

player.

Better product life and durability.

No direct marketing experience.

We cannot supply end-users abroad.

Spare manufacturing capacity.

Some staff have experience of end-

Need more sales people.

user sector. Have customer lists.

Limited budget.

No pilot

or trial

done yet.

Direct delivery capability.

Don't have a detailed plan yet.

Delivery-staff need training.

Product innovations ongoing.

Can serve from existing sites.

Customer service staff need training.

Products have required accreditations.

Processes and systems, etc

Processes and IT should cope.

Management cover insufficient.

Management is committed and confident.

 

Opportunities

threats

Legislation could impact.

Could develop new products.

Environmental effects would favour

Local competitors have poor

products.

larger competitors. Existing core business distribution

Profit margins will be good.

End-users respond to new ideas.

risk.

Market demand very seasonal.

Could extend to overseas.

Retention of key staff critical.

New specialist applications.

Could distract from core business.

Can surprise competitors.

Possible negative publicity.

Support core business economies.

Vulnerable to reactive attack by

Could seek better supplier deals.

major competitors.

ABBREVIATIONS

SWOT: strengths weaknesses opportunities threats.

SOFT: fault and bad in the future is a threat.

SWAGs: scientific wild ass guess.

CSFs :critical success factors.

SLOT: strengths limitations opportunities and threats.

ERC: engineering research centre.

CSR: corporate social responsibility.

GDP: gross domestic product.

PEST: political economic social technological.

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REFERENCES