Perspective

NANO; The Indian-Ness At Fore

Authors:
Pratika Mishra, MBA
Research Fellow, IIIT-A

Rattan Tata has given an amazing New Year gift “Nano” to India and the World and it has embossed the innovative spirit of Indian industry. The legend of Nano is not a historical moment, because it is cheapest car in the world but because it touches our emotions, our hearts and brings a sense of pride to a wannabe nation with innovative capability. The Tata motors in their repertoire always had the prideful connotations of Indian-ness be it “Indigo” (India-Go, Surge Ahead), or “Indica” (Of and for India) and now the “Nano” (stunningly small and precious as Nayna-the vision). Henry Ford’s Model T of 1908 and Tata’s Nano of 2008 both may be a century apart but both have a common denominator. Both have revolutionizing the auto manufacturing, former by introducing the mass-production system and latter by the massive innovative marvels. Model T represented a paradigm shift and placed USA on an unprecedented launching pad for upward social, economical and democratic mobility. Nano may be construed as second auto revolution to deliver the dream of surging Indian middle class to have their own private travel, which was considered hitherto the bastion of elite.

While the scientific community is fiercely debating the technological marvels of “nano” (particle 50000 thinner than human hair) and its impending beneficial capabilities, in medicine, engineering, IT, space and material sciences etc. yet, the inductions may decades away. Nano of India has arrived as an auto innovation. This demonstrates that given the motivation we can compete on superior management and manufacturing capabilities too, leaving behind the legacy of decades of attempting to compete on cheaper skilled labour and abundance of natural resources.

Imagination & Aspiration:
There are about five million cars and 70 million two-three wheelers on Indian roads. In the coming five years at the pronounced rate of production there might be additional 500,000 Tata Nano in the Indian market. These will certainly be 500,000 ordinary Indian families enjoying a safer ride in their own four-wheeler. The GDP is growing around 10% and economy being rejoined to waterfall model will handle it squarely with high liquidity and simulating growth. 80% of people living around highways and expressways never have the opportunity to use them because they simply cannot afford the cars or even auto-rickshaws to drive on them. This provides for the first time the very prospect to masses to have their share of the roads.

The Auto giant of western mind set could no longer get to this target not by using cheaper labour or cheaper materials available in India. They are going to get to this by bringing into innovative product design skills, consumer insights, management systems, perhaps even a new paradigm shift in business design. It is clear that, they are going to compete for the first time on capabilities of Indian genius, not on cheap resources. These are the reasons enough for sending a shudder down the spine of many Western executives, not just car industry executives.

Gigantic leap of nano:
R.K. Pachauri, head of the Inter-governmental Panel on climate change who shared the Nobel price with Al Gore and Sunita Narain of Centre for Environment are crying fowl and have nightmares over the possible volume of fuel pollution by nano. More logical would be to protest against big cars that use more space, are highly polluting with least passenger carriage, The fear is not only totally unfounded but it seems they are on denial mode to people who waited for a real chance of a private car for years. The skeptical has gone to the extent of proclaiming that it will be kicking a dowry race, as the demand would graduate from two-wheeler to Nano. It may be imperative to analyze the governmental policies of subsidies, which encourage pollution, adulterations and congestions in totality. Nano would be benefiting office attendant, cook, peon, venders, and roadside Dhaba runner and would see them being mobile. The Nano has the least emissions and best mileage. India is at the bottom in terms of cars per person by world standards. London and New York have the ultra high car density, yet they have the cleaner air than Delhi. Nano will not burden us with too many cars. Our problem is too many bad polices not too many cars.

Impact of $3000:
A dream car of Indian middle class with a price tag of around $3000 was a reality in Jan. 2008. The immediate reactions were of frenzy, suspicion, skepticism, yet it has aroused passion in millions. Nothing equal or better at this level and quality is accessible globally. Chinese’s and Korean variants are around $5000 a piece with no match. Thus, it is most affordable car with 5 seats and has 21% more utility space than Maruti 800 even after being 6% less in size. The economy of purchase is, it would cost a little over Rs.1-lac (Rs.130000/ on road) and with minimal down payment, and it may be financed and owned on a monthly premium of Rs.3500/- for 6 years. It is an engineering feet accomplished with quality which bring hope to millions. The real message of the Rs 1.00 lack car in one stroke is that a new era in Indian managements systems has arrived. The spin-off of Nano on global auto market will be of curious introspection. The tsunami of Nano had unleashed forces of fierce competitiveness, cost reduction, efficiency, better aesthetics, and management by innovation and social re-engineering.

The features of designing are aesthetically pleasing and desirable with eye-catching colour to titillate the imaginations. Thus, Tata nano has been feasible by combination of thousands of small and significant innovations to attain the self-imposed cost constrains of Rs.1.00lacs. The power of this innovation may profoundly influence the global auto industry and it has already forced a debate at unprecedented scale. The guiding force behind all this has been the inner conviction to provide honorable mobility to masses. Nano provides the answers in terms of management and leadership, engineering and designing marvel, and efficient use of resources, capital, raw material and energy

The Global Hub of Quality Small Car:
The management Guru, C. K. Prahalad writes in Times on the nano launch “the nano represents an important inflection point in the global auto industry and in the evolution and maturation of Indian industry. There is greater excitement because Tata motors have introduces to the global auto industry a whole new consumer segment.” It is established that the Indian engineers – given the right challenge and leadership can out-innovate and out engineer others. Seldom does a single product introduction have received wisdom analysis in the industry so radically. The nano also sheds light on how to leverage emerging market as innovation hub. The Nano stars with self-imposed constrains of cost, efficiency, durability and consumer and comes out with flying colors. Let us celebrate!

The Innovation:
Ratan Tata in “Nano” masterstroke has demonstrated our technical industrial and innovative approach interwoven with social engineering. Speaking at the unveiling ceremony at the 9th Auto Expo in New Delhi, the Down of Indian Industry Ratan N. Tata said, “I observed families riding on two-wheelers – the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby. It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family. Tata Motors’ engineers and designers gave their all for about four years to realize this goal. Today, we indeed have a People’s Car, which is affordable and yet built to meet safety requirements and emission norms and to be fuel-efficient. We are happy to present the People’s Car to India and we hope it brings the joy, pride and utility of owning a car to many families who need personal mobility.” The stimulus came from plight of a common Indian. There was no business confine in the mindset. He silently pledged to produce a four-wheeler affordable by masses at the cost of a two-wheeler. The genius in Ratan Tata was determined to arrange a wedding between the technological marvel and the people’s need.

The Zip and zap:
Hefty profit making by the likes of Hyundai, Honda and many other who were venturing to exploit the market of surging economy would see the cost rationalization soon. Lyrically India lived in a mental captivity of West for too long; India of Nano believes that stronger should master the world and inherits the earth. The job market will be simulated as the auto volume would increase and demand of technical skill will be on ascendance. The Indian-ness will at the fore as the India of small towns and rural segment has its own dynamics to accept the folklore of such revolutions. The Indian middle class has arrived. The retort of Harbhajan Singh is not a fluke, T-shirt waving Saurabh on the balcony of Lords is not a mere jingoism but of self-respectability.. Metros like Delhi could be cleaner from the menace of humming and polluting mosquitoes (autos).

Laxmi Mittal visited Jamshedpur on the occasion of centenary year of the Tata Steel and wrote in his memoir “Tata’s have returned more than what they have taken from the region”. What stuck to him was that a silent, unpublicized social engineering with devotional approach and on unprecedented scale (primary school and health center, boarding school, roads, drinking water etc) has been accomplished by Tata’s in the region. Thus Nano is more a social “revisit” and an immaculate care for masses than business.