“Innovating continuously and intuitively: the TATA experience”
Summary of Key Talks
Over $60B revenue, presence in 74 countries, strong brands like Tetly, Land Rover, Taj hotels,… but really they “make one product” – TRUST. Some brands achieved via acquisitions – when buy a new company - want the people to stay – one of the conditions for the acquisitions – can the new company and TATA work out a good partnership – like the way the Indian man should treat his new wife J in building their relationship and home together.
The speaker spent many years in other companies and has a mox of internal and external perspective about TATA.
They think about four types of innovation:
Process; Product/service (less difficult to replicate, and lower footprint of impact.
Business Model and Social applications (the most) are difficult to replicate and have a higher footprint of impact.
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Product & Service – TATA ACE (Car) and GINGER HOTELS ($20 a night tidy and air-conditioned)
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Process –in 2004 TATA Chemicals adding Larox Filtration Process
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Business Model – TATA Consulting Services – a global player in software that in 1968 ventured into off-shore computing. Invented the whole business model for off-shore computing.
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Social Application – some innovations have a he social impact – i.e. the new cheap TATA cars, but also the structure of the TATA group. Not a holding company that has “upside down trees” beneath it in many layers. TATA is organized as a upstanding tree with the TATA Trust (with many share holders) that provides the values and exists for the “people”. The company is 140 years old. The Trusts (owners) are like the routes. The trunk is TATA Sons and TATA Industries – and above – the main brunches are TATA Steel, TATA Motors, Consultancy, Power, IHCK, Chemicals, Communications… and above at the top, the youngest companies “get the sun” – companies like TACO Group, Voltas, Rallis, TATA Realty, Tata Tele Services… The owning company is not listed but the business attention is on the youngest companies. Put a significant percentage of revenue into the trust which will be invested in social benefits and activities. They have 150 companies.
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Degree of innovation:
High
Modest |
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in TATA there is a strong correlation between the unconscious innovation and the highest degree of innovation |
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The level of consciousness: |
Conscious innovation Unconscious innovation |
Tata’s leaders don’t think of themselves as innovators but in fact they are very much so. They don’t necessarily create patents or other things that are “considered to be innovative”. By creating fluid organizations to that actually support the “unconscious innovation” with:
1. Permeable boundaries: ideas flow in and out easily
2. Minimum critical rules
3. Aligned aspirations: believes the company innovates unconsciously because the innovation benefits go to the Tata Trust and everybody can enjoy it…
4. Flexible architecture: can adjust to new requirements quickly and well. i.e. the Indians created super computing capabilities for their nuclear program – 25 years ago – when the US denied this from them. Took 4 years to that! Used by Tata for diagnostics and advanced computational biology, etc.
Keep innovating: Tata’s Nano car, new computing capabilities, new consulting offerings…. Etc, including setting in 1994 an independent Electoral Tryst – they can donate money and it is divided to the political electorals according to their current and future power in politics – try to be just. Sort of a government job.
Give prizes to people who try innovative things but seems that the structure of the company and the fact that this is people’s job anyway – other incentives are not that necessary.
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