As the famous lines in “The God Father” go, it is very important to demarcate between personal and business issues. Let me cite Michael Corleone's words “It's not personal…. It’s strictly business”.
Like many, I was a keen follower of Mergers & Acquisitions which took place over the last few years. I am very impressed by the scale of acquisitions taking place across various verticals in the industry. I believe, owing to several factors, many industry verticals (irrespective of how mature they are) are going through a consolidation phase. In every industry, this phase is bound to happen at one time or the other.
I was also following the JLR (Jaguar-Land Rover) deal which the Tata Motors won. I am glad that Tata’s can use their expertise in turning around unprofitable businesses to turn around two iconic British brands. Like many, I too have my own concerns. Considering the portfolio of Tata Motors, terms of the deal etc, can Tata’s turn around these businesses. On the positive side, this deal could potentially make Tata Motors a “one stop” for car enthusiasts. Also, a typical customer could start with a Nano, upgrade to Indica/Indigo/Palio few years later and could upgrade to some high end model (Range Rover, X* series in Jaguar) when he/she could afford. So, a customer could purchase his first car and his last car with Tata Motors, provided that the customer is extremely satisfied by the service received from Tata Motors. Not to forget, the international market Tata Motors would be targeting with JLR. Of course, all this requires lot of effort and planning on behalf of Tata Motors.
I came across a post on JLR deal in BusinessWeek and it is worth motioning. For the post, click here
While this post is a very good write up on JLR deal, I would say I am disappointed by the comments section. After I read the comments, for a while, I really had second thoughts on free e-media. The context of the post is lost just in the first few comments and it looks as if the comments turned out to be arguments. Phew! (Few comments reminded me of dialogues in Rajnikanth's movie).
After I read the comments, I am all the more puzzled due to several questions that ringed in my mind. They are:
1) In this globalized world, how fair are the words “Indian (any country for that matter) Company”
2) What does it take for a company to be called an Indian company? Do the founders need to be Indian? Do the majority of operations focus on India? Do majority of share holders need to be Indian? Do all the share holders need to be Indian? Do the CEO and majority of the management team need to be Indian? Should the company be funded by Indian government and the company be responsible to the cabinet?
3) When Tata signing JRL deal can be compared to the victory/domination of Indian businesses over British businesses, what does Vodafone’s purchase of majority stake in Hutch signify?
4) Does the fact that every body is using electric bulb signifies the power of American innovation over ignorant rest-of-the-world.
All such comparison with foreign institutions and brands does no good to organizations and brands emerging out of India. Instead of focusing on differences, I think one should focus on common strengths and spread globalization to every corner of the world enriching people. At a time when Indians (including me) need to educate the rest of the world about India’s rich and diverse culture, all this rant and unnecessary comparison makes the task much more difficult.
By the way, congratulations to Tata Motors for sealing the deal. The real deal (turning the two brands around) starts NOW.
P.S: I have created a poll on my blog. You can express your opinion on the Tata-JLR deal by casting your vote @ http://vijaybhaskarvbc.blogspot.com
Like many, I was a keen follower of Mergers & Acquisitions which took place over the last few years. I am very impressed by the scale of acquisitions taking place across various verticals in the industry. I believe, owing to several factors, many industry verticals (irrespective of how mature they are) are going through a consolidation phase. In every industry, this phase is bound to happen at one time or the other.
I was also following the JLR (Jaguar-Land Rover) deal which the Tata Motors won. I am glad that Tata’s can use their expertise in turning around unprofitable businesses to turn around two iconic British brands. Like many, I too have my own concerns. Considering the portfolio of Tata Motors, terms of the deal etc, can Tata’s turn around these businesses. On the positive side, this deal could potentially make Tata Motors a “one stop” for car enthusiasts. Also, a typical customer could start with a Nano, upgrade to Indica/Indigo/Palio few years later and could upgrade to some high end model (Range Rover, X* series in Jaguar) when he/she could afford. So, a customer could purchase his first car and his last car with Tata Motors, provided that the customer is extremely satisfied by the service received from Tata Motors. Not to forget, the international market Tata Motors would be targeting with JLR. Of course, all this requires lot of effort and planning on behalf of Tata Motors.
I came across a post on JLR deal in BusinessWeek and it is worth motioning. For the post, click here
While this post is a very good write up on JLR deal, I would say I am disappointed by the comments section. After I read the comments, for a while, I really had second thoughts on free e-media. The context of the post is lost just in the first few comments and it looks as if the comments turned out to be arguments. Phew! (Few comments reminded me of dialogues in Rajnikanth's movie).
After I read the comments, I am all the more puzzled due to several questions that ringed in my mind. They are:
1) In this globalized world, how fair are the words “Indian (any country for that matter) Company”
2) What does it take for a company to be called an Indian company? Do the founders need to be Indian? Do the majority of operations focus on India? Do majority of share holders need to be Indian? Do all the share holders need to be Indian? Do the CEO and majority of the management team need to be Indian? Should the company be funded by Indian government and the company be responsible to the cabinet?
3) When Tata signing JRL deal can be compared to the victory/domination of Indian businesses over British businesses, what does Vodafone’s purchase of majority stake in Hutch signify?
4) Does the fact that every body is using electric bulb signifies the power of American innovation over ignorant rest-of-the-world.
All such comparison with foreign institutions and brands does no good to organizations and brands emerging out of India. Instead of focusing on differences, I think one should focus on common strengths and spread globalization to every corner of the world enriching people. At a time when Indians (including me) need to educate the rest of the world about India’s rich and diverse culture, all this rant and unnecessary comparison makes the task much more difficult.
By the way, congratulations to Tata Motors for sealing the deal. The real deal (turning the two brands around) starts NOW.
P.S: I have created a poll on my blog. You can express your opinion on the Tata-JLR deal by casting your vote @ http://vijaybhaskarvbc.blogspot.com
3 comments:
I have also written a blog on Tata-JLR deal, but mine pales in comparison to yours :P
Yours is a much more informative and researched blog
dude.. that's what the comments sections are ALWAYS for.. 90/10 rule.. :)
about the deal itself... i'm tempted to think that Tata's objectives other than those stated also include hold on Ford's technology... cause Tata has a proven commitment towards technology and value innovation.. (Remember Nano?)
I must confess.. I've NOT been following this deal ardently.. so whatever I say here might be TOTALLY wrong! but I guess foremost problems being faced here are high production costs and inadequate marketing.. I think Tata has a proven track record to tackle these problems! I guess their primary objective would be to bring the cost down without losing out on the 'premiumness' of the brand.. and we have all the reason to believe they can do it.. :)
I was hoping this deal will make these brands more reachable specifically in the Indian market.. no signs yet.. lets see.. :D
@prashanth
Thanks for your comments. Your blog looks at things from a different perspective and I liked the comparison of events.
@pratik
Thanks for your comments. Personally, I think Tata Motors would use this deal to get access to international markets and learn intricacies of dealing with luxury car and then enter Indian market.
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