featuredimage_tatabyebye_7aprl2012

Tata Bye Bye – The Great Debate

Tata, the flagship Indian conglomerate, reaped rich benefits of the free publicity (rumoured to be to the extent of Rs. 500 crores) by announcing the Nano. The company was praised for its frugal innovation.

Image Reference:http://www.crazyengineers.com/wp-content/uploads/2011/12/Tata-Nano-Starter-Motor-Replace-Tata-Motor.jpg
What followed after a status update by Sunil Malhotra was this Facebook battle of wits on 26th March 2012, between Umesh Nevgi and Sunil Malhotra on the relevance of the world’s cheapest car, Tata’s Nano.

We reproduce the great debate for you here and welcome your perspective

Hi Sunil, I have not read any market report or feedback on the Nano. However, I wonder whether is it still not a better & relatively safer option and, hence, an upgrade worthwhile for the numerous families who ride three-up or four-up on a scooter through the busy lanes? I understand this was the vision of Ratan Tata behind it.

Umesh, vision is an outmoded concept IMO. Ratan Tata, no disrespect to his calibre or great achievements, screwed up big time here. The Nano is the outcome of the idea of someone sitting in a customised S-Class Merc and looking at life around him through tinted glasses (all puns intended). How far removed from reality can anyone get? The many plusses in the run up to the launch of the 2000 dollar car are completely overshadowed by the sheer irrelevance to the context of the customer. Sorry, but in my book the only phrase that comes to mind is regressive innovation.


Sunil, product placement– imho – is not an outmoded concept – not yet at the least. There is a place in the marketplace for a Nano to a S-Class Merc and beyond – to suit every pocket, need, want, wish and whim. Admittedly, the Nano may not be an ideal car (I did read some questions raised about its safety levels), however– let’s face it- it is a no-frills car. This itself perhaps should not be the reason for writing off this car altogether. Hopefully, the safety aspect does get improved – within the given cost constraints – for the next upgrade of this car. Finally, as for any product from a toothbrush to a car, striking the right balance between its cost and its quality is always critical. Key q : Is the Nano of today really a more dangerous vehicle on the roads than a scooter ridden – rather perched upon precariously- by a family of four in a busy rush-hour traffic? If not, then would we still call this ‘innovation’ regressive?

I agree with most of what you say but that is a product centric view at best Umesh. From a social relevance perspective, aspiration and image of the target segment have been ignored. Not intentionally maybe, but overlooked at the very least. One is not writing off the car at all – it is a great example of no-frills product engineering. But it has failed the test of the market and the consumer. There are hardly any Nanos on the road 3 years down. That speaks for itself. Hail the market. Hail the intelligent Indian. BTW the starting point imho of the scooter is what I’ve always questioned. My early take even before the launch were published 3-4 years ago in a slightly different context. Car Ke Side Effects
Prophetic or not, you decide.

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Hi Sunil, enjoying this debate… reminds of our hostel years. Read your article – great stuff! I can see where you are coming from – your concerns et al – and I would tend to agree with many of the points/concepts within… corporate social responsibility, the risks of creating a problem while solving another, the legacy of ‘do now, think later’ policy. Social relevance – a key issue indeed. However, I would largely disagree with shifting the entire responsibility for social implications of any product towards the corporate world. The government and – more importantly – we the people shoulder a much MUCH larger responsibility for this. The softer side of this issue – the need for traffic literacy, discipline & fairness on the roads, compliance to law – would need to be met rather through an efficient system of rules & regulations – including extensive monitoring for compliances and severe reprimands/penalties for any non-compliances to such laws. Such an onus for – in your words – a holistic and sustainable approach rests primarily on the lawmakers and the populace alike. Same would hold good for the infrastructure – or, more precisely, the current lack of it. One can not penalise or hold responsible the Tatas for this – beyond their share of responsibility, of course. Secondly, although a climb towards an ideal & disciplined world is the ultimate target, such improvements seldom come in large leaps and often come in baby steps. I reckon the Nano is one such baby step – faltering though it could be. My main support for the Nano rests on the fact that it upgrades the scooter-riding four-up family towards a relatively safer commute. This by itself has a significant social relevance, I hope you agree. If solving a larger problem means living with a new & relatively smaller problem, then so be it. We now then resolve the new smaller problem. One point I would however differ on with the Tatas is that, I think, in the rush towards the world’s cheapest car, the Tatas set themselves super-ultra-low cost and, thus, safety targets. Increasing the cost target to, say, double the current target would have helped to achieve higher safety-levels and, as a byproduct, also control the projected sudden and exponential volume explosion.

Beautiful point about Tatas having set a low target (pun intended), Umesh. That’s what irked me about India’s best brand.

 

Good pun, Sunil. I better understand your irk now. Not having a direct exposure to the Nano, I am not aware of all the issues related to this car in the field. I do find the original intent of bringing the car to the masses as worthwhile. However, based upon the reports I have read, Tatas seemingly have cut large corners and gone overboard in their zest to come up with such a cost-effective vehicle. Hopefully, they now rectify this and come up with a better balance between the cost and the features – perhaps a Micro than a Nano.

LOL! Now that they have proven the low-cost point, they should perhaps think of repositioning it as a campus vehicle for students in the US. And, yes no excuses for compromising safety.

 

Sunil, now that we have discussed and decided to evolve the Nano into a Micro – repositioned with better safety features and a slightly higher but relative to the market still a lower price, this executive decision just simply needs to be conveyed to the Tatas. :)

Hahaha! On a more serious note, corporates (I just made a typo that works even better- corpirates) would be better off moving from business cases to business causes, don’t you think. But they will never get it.

That’s a bit harsh on the corporate world, Sunil – I think. Tatas may have got the balance wrong, but that seems to be just a case of a business strategy gone upside down – can be still rectified at a cost, market forces will ensure that anyway. I reckon the crux of the issue here – the lack of infrastructure / traffic literacy / discipline – boils down to the lack of a strong will from the governments over the years to improve the system in parallel. A willing & empowered governance can literally work wonders to the system and be complimentary to the works of entrepreneurs like Tata – and then the consumer wins. Remember Paan Singh Tomar : bihar mein to sirf baagi rehte hai, asli daaku to sansad mein rehte hai. Perhaps too strong/filmy/exaggerated/”generalised a statement that is, but – unfortunately- not totally opposite from the truth either.

Call me disillusioned. Doing business in India has never been easy especially for those who do not want to bend the rules for their own selfish needs. The Government has been the main culprit, but what sustains Government apathy is the need for greed and power by corporates and our hugely corruptible media. Let me hasten to add that Tata is one of the few companies that has always upheld ethical practices and is a role model for the whole world. It might even be the only Indian Corporate in my book that is incorruptible. But that is the topic of another discussion. But the rest of India Inc. – the less said the better.

Sunil, I fully understand your disillusionment and frustration. I also share your views on Tata (and hence my hesitation to blame them). Tata is perhaps the only visible one, however I am sure there are few more – including one I know in Okhla Phase I, albeit in minority. However, in spite of all the adversities, stay positive – that is the only way to beat the system… eventually. Look at it this way – at the end of the day, not having bent the rules would bring in the inner satisfaction to oneself that having joined the ‘club’ would never ever fetch in. Easier said than done –  however this would always remain THE challenge. It is more than a marathon – stay put and stay the course, my friend. I assure you – the distant & faint light at the end of this long tunnel is not of any train.

Read the original debate on Facebook

Download – Car ke Side Effects(PDF),  Innovation 101 – The Jugaad phenomenon,  Car Ke Side Effects

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