The pertinent issues regarding their unique growth and implementation strategies from a global strategy
The crucial issue regarding Tata’s unique growth and implementation strategies is its objective. It is unclear whether the company’s objective is to be a true global motor vehicle organization that is present in all markets or whether it wants to be a leader in emerging markets by lowering the prices of its products. The issue is related to an attempt to enter new markets and obtain sufficient market share to remain afloat and stable. The global automobile sector has a heavy saturation of major companies, which create entry barriers and decreases the threat of new entrants. Many factors contribute to the high entry barriers (Rao, 2017). For example, significant capital investments are required to enter the vehicle sector. Examples include initial property, equipment and plant investment, research and development investment, and economies of scale investments. The industry’s supply chain associations are also another entry barrier. Manufacturers, assemblers, and raw material suppliers often form long-term contracts, which create a high entry barrier for a new competitor. Proof of substantial potential profits after an investment is required before entering a new market because of the elevated start-up costs.
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If the company’s objective is to be a big player in the global automotive sector, it must first learn from the experience of companies that attempted to enter new markets. The company also must control its expenses to ensure its profits are not affected. For example, while its 2012 profits improved from the previous year, total costs also increased within the same period. Cost cutting is, thus, the key factor for the company to track and handle.
Analysis and evaluation that highlights its competitive advantages compared to their competitors
The key strength of the company is its ability to produce low price products. For example, the introduction of the Nano gave the company an edge over its competitors. While many units of the Nano were not sold as the company had desired, there are many international markets identical to India’s market where low priced cars such as Nano can be sold. Nano’s global expansion is, thus, the major competitive advantage of Tata even though the company must improve the model to address consumer safety issues. Innovation and focus on consumers is another competitive advantage of the company. The company has successfully adapted to consumer and market conditions to gain profits. For example, the company recognized India’s low-income level and introduced the Nano car model as an affordable consumer car. The company is also a strong domestic car company as it is the leading automobile firm in India. Its brand name is recognized across India and it has many products in the Indian market. The company is also the top automobile manufacturer in India. Another important competitive advantage of the company is its increasing brand recognition in its market segment. It is possible that a majority of customers in developed economies, such as the United States, lack knowledge about Tata car brand. The company, however, is growing in developing economies that need low-cost cars.
Recommendations based on their competitive advantage
The company should maintain domestic market dominance by studying consumer trends and developing products based on the needs of its consumers. Globally, the company should focus on developing new car brands that target the entry-level segment in modern markets. It should also focus on offering value and providing products that can compete with other products on the global market. The company should also strive to enhance its brand reputation globally by providing reliable products that attract target consumers (Morley, 2009).
References Top of Form
Morley, M. (2009). The global corporate brand book . Basingstoke: Palgrave Macmillan. Bottom of Form
Rao, C. B. (2017). Competitive Strategy . Notion Press.
