Management Control System

Project
on TATA Motors
Ankit Chauhan
Jagrut Patel
Pooja Raghuvanshi
Atit Shah
Pratibha Behl
Ashima Koul

GOOD BETTER BEST NEVER LET IT REST

Introduction

Founded by JRD Tata in 1945

Consolidated revenues of INR 1, 65,654

crores for the financial 2011-12

Vision is to be 'Best in the manner in which we

operate, best in the products we deliver, and best in
our value system and ethics.'

The companys Mission is Leadership with

trust.

Presence
Jamshedpur, Sanand , Lucknow, Pune ,
Pantna Nagar, Dharwad with Internation
OTHER COLLABORATIONS/M&A &
West Europe
Russia*
Presence in
JVs
U.K.

Tata Daewoo Commercial Vehicle

Hispano in Spain & Marcopolo In
Brazil
JV with Jardine Matheson for
ConcordeMotors North Africa
Technology Tie Ups Egypt
at Spain,Italy

Italy

Ukraine*

Central Asia
Afghanistan
Uzbekistan

South Asia
Bangladesh *
Nepal, Sri Lanka

West Africa
Senegal
LATAM
Brazil

West Asia
Saudi Arabia
Iraq, Iran
South Africa
South Africa*

* Assembly Operations also

East Asia
China
South Korea*

East Africa
Kenya*

South East Asia

Malaysia*
Thailand

Objectives
Employee Focus: Make the organization a
Great Place to work
Community Focus: Be a responsible
corporate citizen
Supplier Focus: Treat Suppliers as partners
Shareholders Focus: Demonstrate superior
results
Customer Focus: Improve Customer
Satisfaction.

Code Of Conduct

25 codes called clauses for its conduct with various parties

i.e. nations in which it operate, the public, the government,
the customer, the employees, the stakeholders etc.

Financial reporting & records

Competition
Government agencies
Quality of products
Corporate citizenship
Use of TATA brand
Ethical conduct
Regulatory compliance
Reporting concerns

Technological Resources

R & D establishments at Jamshedpur, Pune &

Lucknow over 1400 engineers.

Indias only certified crash test facility for cars

and hemi anechoic chamber for testing of noise
and vibration.

Tata Motors European Technical Centre (TMETC)

set up in 2005 primarily involved in design
engineering and development of products,
supporting Tata Motors skill sets.

Contd

Tata Daewoo Commercial Vehicle Co. has

its R&D facility in Gunsan, South Korea.

Hispano Carrocera has its R&D facility at

Zaragoza in Spain.

Financial Resouces

Stable cash flows for the past five years

Cash rich corporate parent Tata Sons

Strong reputation access to capital

markets

Organizational Resources
Process Approach EPM (derived from APQC
processes and TBEM model.

10

Enterprise Model

Organisational Structure

Contd
Relatively flat structure
Narrow span of control
Based on the divisions, Tata Motors has a
mixed organisational structure.
Two main divisions based on product type
viz.

Commercial vehicle and

Passenger cars division

Coordination and Communication

Tata Motors has newsletters and house
magazines published monthly for each
division.
ManCom meeting for all departments
together.
All the departments are interconnected with
intra networking and internetworking
system.
Various periodic articles about the wellbeing
of employees, promotions, deaths, etc. to
make employees connected.

Information Systems at TATA

Motors

Measures Taken up to Maintain the

Quality of Products

R&D at TATA Motors

Product
Improvement
In Plant
R and D
Process
Improvement

R and D in
Tata Motor
ERC
(Central level)

Research and Development Structure at Tata motor

Key Strategies

International strategy based on the

competitive advantage:

New product (eg. Tata Nano, the cheapest car in the

World).
Acquisitions (eg. Land Rover and Jaguar brands from
Ford Motors).
Partnership with established companies (eg. Alliance
with Fiat since 2006) to enhance the product portfolio
and knowledge exchange.
Facilities for learning from other companies.
Developing programmers for intensive management
development

Stretch and Leverage

Tata

Nano: The innovative small car for

the urban middle class
Fulfill the requirements of its customer value
proposition
Deliberately created a young team with good
leadership capabilities who think differently
Excellence in outsourcing
Reconceived its supplier strategy - 85% of the
Nanos components
Fewer supplier (<60%)

Contd..

Acquisition : Land Rover and Jaguar for $2.3

billion - Complementing Resources - Blending
& Balancing
High Replacement cost
Complimentary to Tata Motor in the upstream
business
Access to global markets
Transfer of knowledge, technology from high end
market

Contd
Overall ..
Strong product development capability
Manufacture products or deliver services of
highest quality at lowest prices
Sufficiently widespread distribution and
service network
working around offering more affordable,
more value-oriented products

Diversification
1977

First CV from Pune plant.

1983 First HCV rolled out.
1986 First LCV (Tata 407) launched
followed by Tata 608.
1991 First passenger car Tata Sierra
launched.
1992 Tata Estate launched.
1994 Launch of Tata Sumo.

Contd
1997

Tata Sierra Turbo launched.

1998 Indias first indigenous Passenger Car
Indica launched.
2001 Second Generation Indica v2
launched.
2008 Launch of Suma Grande
2008 Launch of Nano at ninth Auto Expo
2011- Indica eCS, Manza
2013- Indigo eCS

APPRAISAL & REWARD APPRAISAL

New appraisal system based on KRAs &
targets
Review of targets at regular intervals
People development an important KRA

REWARD
Promotions based on performance
Productive and profit linked incentive
schemes
Selection of supervisors based on
performance / attendance/ discipline etc.
Job rotation (dept. shifting options)
including inter functional

RETENTION AND EMPLOYEE

WELFARE
Residential colonies for employees.
Hospitalization reimbursement on actual
without ceiling.
Vehicle loans
Household equipment loans
House building advance
PF trust policy- for better mgt.
Better pension scheme

HR INITIATIVES

Re-alining organisational culture according to

the vision and values.
Performance linked reward and recognition
system.
Career planning and promotion policy
Revised recruitment policy
Competency mapping
Internal communication
Union alignment policies
Employee involvement and participation

HR POLICIES AND PRACTICES OF

TATA MOTORS
HR Practices Regarding Recruitment.
Performance Evaluation of Tata Motors.
Providing equal opportunity.
Rewarding union employees.
Vehicle and profit linked payment Scheme.
Employee engagement.

RISK FACED BY TATA MOTORS

Interest rates and other inflationary trends

Fuel Prices
Input Costs / Supplies
Restrictive covenants in financing agreements
Environmental Regulations
Exchange and interest rate fluctuations

AUDIT COMMITTEE
Reviewing

the
quarterly
financial
statements before submission to the Board
Reviewing with the management, external
auditor and internal auditor, adequacy of
internal control systems and recommending
improvements to the management.
Recommending the appointment/removal
of the statutory auditor, cost auditor, fixing
audit fees.

Contd
Reviewing

the Companys financial and risk

management policies.
Reviewing the financial statements and
investments made by subsidiary companies.
Look into the reasons for any substantial
defaults in payment to the depositors,
debenture
holders,
shareholders
and
creditors.

GRIEVANCE
The usual steps in grievance procedure are:
Conference among the aggrieved employee,
the supervisor, and the union steward.
Conference between middle management and
middle union leadership.
Conference between top management and top
union leadership.
Arbitration.

Benefits of having
Grievance procedure

Compliance
Review the effectiveness of the system for
monitoring
compliance
with
laws
and
regulations and the results of management's
investigation
Look into the reasons for substantial defaults
in the payments to the depositors, debenture
holders, shareholders and creditors.
Review the process of communicating the Tata
Code of Conduct to employees

Contd
The Ethics & Compliance Committee
was constituted to formulate policies
relating to the implementation of the Tata
Code of Conduct for Prevention of Insider
Trading.

Whistle Blower Mechanism: The

Company has adopted an unique WhistleBlower Policy.

Achievements

The sole winner of the JRD QV Award 2005 was

the commercial vehicle business unit, or CVBU, of
Tata Motors

PCBU's business excellence initiative has come

into its own.
Serious Adoption Award in 2004
Active Promotion Award in 2005

Tata Motors have crossed the level of 60% to win

the JRD-QV award in 2001, 2004 & 2005
respectively