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Tata Motors new MD to overhaul operations

Guenter Butschek the new chief executive and managing director of Tata Motors is set to initiate some crucial operational changes, overhaul the brand positioning and spruce up manufacturing processes to make the company more agile and future ready.

Butschek, 55, who took over the reins a month ago, said that his focus will be to make the company leaner and more flexible, which will help in responding to market changes faster than it has historically.

"We will identify the root causes of some of the inefficiencies we experience at Tata Motors. You need to be sufficiently agile and fast in responding to consumer demand. Processes needs to be simpler. We will take very decisive decisions on short notice. Tata Motors will undergo a major transformation process in order to get future ready", added Butschek.

Butschek has been tasked to turnaround Tata Motors fortunes which has been plagued by low demand despite the launch of three new products in the span of six months. Butschek fills the void created by the demise of former MD Karl Slym in January 2014.

Tata Motors is desperate to gain ground, which it lost to rivals like Mahindra & Mahindra and Honda in recent years. In the April-February period this year Tata Motors reported a fall of 4 per cent in domestic car, UV and MPV sales even as the industry grew by nearly 8 per cent during the same period. Its share has collapsed to 5.45 per cent compared to 14 per cent reported four years ago.

Analysts tracking the company state that Tata Motors has been slow in responding to changing consumer tastes. Besides there are issues relating to its brand perception. In an hour long maiden interaction with the media Butschek said he realises both the loop holes and has hit the ground running.

"We need to very carefully consider how we position the brand. Sometimes the brand attributes are differently interpreted by products and also by the customer/market. There needs to be a clear statement that actually captures the brand values of Tata Motors. And serves as the backbone of the organisation and to the entire value chain. It has to be very crisply clear to our suppliers and to customers. It will become the backbone for my internal transformation."

Butschek, who was the former chief operating officer at Airbus, stressed on the need to focus on three key elements - technology, design and quality - besides placing global products as a benchmark as against Indian products for making a rightful push in the market.

The company will not be reinventing the Tata Motors brand but will reposition itself, the result which promises to surprise the market. "What we are going to communicate in a couple of weeks might look in the first instance like something new but to put it in the context it will be 'wow' which is the essence and that is what we are looking for", added Butschek.

Tata Motors also intends to cut down on its number of suppliers in order to improve quality and consistency. "We have room for improvement has far as productivity is concerned and in quality. We will reduce the number of suppliers because this is one of the few areas where it is right to say 'less is more' because I would focus my resources in the development of my strategic supply partners instead of wasting it on those who will remain substandard", added Butschek.

On the product front Butschek explained that besides the Nano, which has a great potential for the future the company will look to not only enter new segments but create new segments. It is gearing up to launch the Tiago (hatchback), Hexa and Nexon (SUV) this year.

"We are at a crossroads where we need to think about game changers, the Nano was a game changer, the next generation Nano could be a game changer", added Butschek.