04-06-2012, 02:10 PM
The Tata Group
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A global conglomerate with operations in dozens of industries, the Tata Group is not in the business of creating socially responsible goods and services. Yet, for this producer of steel, provider of consulting services, and manufacturer of just about everything in between, CSR is at the heart of its business model.
This supposed discrepancy stems from a distinction often overlooked in the emerging debate over the responsibilities faced by corporations in an increasingly globalized and competitive marketplace. In the popular press, the idea of ‘Corporate Social Responsibility’ (CSR) is often presented as being at odds with the profitability of business operations. Corporations, for example, are applauded by environmentalists for investing in more expensive, but ‘greener’ operating practices, while shareholders are left to fester.
Adapting to New Markets: Internal Sustainability
More than 140 years ago, Jamsetji Tata, the founder of the Tata Group, predicated economic success on putting the community first and investing patiently in social initiatives. To date, this strategy has enabled Tata to excel in India. A big reason for this is the brand recognition that Tata enjoys in India. However, brand recognition is less of a competitive advantage as Tata expands globally. Many argue that given the current heightened pace of globalization and change in technology, Tata’s tenet of investing in long-term social initiatives threatens its short-term competitiveness.
Stepping it up a Notch: Evaluating Product Lifecycle Impact on Society
Throughout its history, the Tata group has been considered a poster child of ideal corporate citizenship throughout India. Yet, as Judy Garland would put it, ‘Tata’s not in India anymore.’ As Tata continues to expand globally
Aligning Purpose with Profit: Internal CSR Market
As the Tata group increases its global operations and dependence on global investors, it comes under intense pressure to prove that focusing on the community as it has done until now can continue to generate profits. Tata’s immense brand value has enabled it to escape skepticism in India thus far, but with 65% of its revenues coming from outside India, this no longer applies.
Rollout New Lifecycle based index (12 months) -
Following the collaboration with all the stakeholders involved, Tata should engage in a rollout of the new “lifecycle” optimized Tata index. This index should be continuously optimized to ensure alignment with culture, operations, and profitability.