Next year will bring macro challenges, says Tata Group chief N Chandrasekaran

Next year will bring macro challenges, says Tata Group chief N Chandrasekaran
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Mumbai, Dec 28: The Tata conglomerate spent over Rs 70,000 crore ($10 billion) in acquiring assets, deleveraging group companies and untangling cross-holdings in 2018 even as it delivered a mixed performance amid a challenging global environment. While TCS and Tata Steel’s profits rose, Jaguar Land Rover skid into losses.
Chairman N Chandrasekaran, in his year-end note to the conglomerate’s more than seven lakh employees, said that 2019 will bring a number of macro challenges. But, “our job is to run our marathon, not to be distracted by somebody else’s sprint”. The Tata chieftain asked the staff to focus on “what we can control” — manage costs while providing customers the best products and services.
Chandrasekaran, who took charge as the chairman of Tata Group in 2017, has been reducing complexity at the diversified enterprise to make it respond and react fast in a competitive market. Highlighting that there is still much work left on that front, he said that of the ten business clusters, some are in the midst of cutting down subsidiaries and exiting non-core businesses, while others are focusing on building scale through mergers and acquisitions (M&As).
The 55-year-old chairman said that group companies have been increasingly tapping synergies by working together “to create new business approaches and differentiation”. For instance, Tata Motors, Tata Capital and Tata Power have been building an electric vehicle ecosystem; Tata Capital takes care of the financing aspect; Tata Power handles the charging infrastructure network and Tata Motors develops the green vehicles.
“Similar efforts are underway in many areas including loyalty programmes, payments and shared services,” he added.
The Tata chairman also said that global liquidity will be tighter in 2019 even as political uncertainty remains high with the upcoming elections in the country. He said that with the economic cycle maturing in developed nations, global growth will rely increasingly on the momentum in emerging markets. Tata Group in recent years has been sharpening its focus on India, especially in the steel and hospitality businesses.
“We can address these global shifts effectively by harnessing scale, synergy, digital depth, operational focus and agility,” Chandrasekaran told the employees in an e-mail communique.
Chandrasekaran, an avid runner, stressed that talent will be a significant focus for the $100-billion-plus conglomerate in 2019. The salt-to-software group, with a footprint in over 100 countries, is one of the largest employers in the world. Of the over 7 lakh employees, nearly 1.9 lakh are women and most are with TCS.
“We have always considered our people to be our biggest strength,” the chairman said. Emphasising on the enterprise’s commitment to create “work environments that work for women,” he said, “While talent is normally distributed, all too often, opportunity is not. We need to fix this — at an individual, institutional and global level. The role of women in the workforce and participation in decision-making structures is mission-critical for our collective future.”
In conclusion, Chandrasekaran, who started his career as an intern with TCS in 1986, said, “Seeing the group from all angles over these years gives me a unique insight into our strongest advantage — all of you… giving me confidence that we have the right resources not just to face the challenges ahead, but to run our race with heads held high.”