Tata Nano Innovation Case Study


 The report attempts to study the tactics and policies adopted by Tatas under theenlightened approach to innovation.

Strategic Innovation

Focused Innovation

Holistic Innovation

Strategic Innovation:

Some of the innovations that Tata Motors followed during the process of coming outwith Nano were not only concerned with the only the car as the product, butextended itself to the whole organizational thought process. Starting from the teamformation to product delivery, everything was thought keeping in mind the promiseof bringing out a quality car within a price tag of Rs. 1 lac that would fulfill the latentdemand of the Indian middle class who could not afford even the lowest priced carat that time.

 The whole idea was radical and required fresh thinking and challenging of age old principles of product designing and manufacturing technologies.Inline with this, the engineering team in charge with the designing andproduction of Nano was very young with the average age being only 28.

 Tata Motors were not shy to unlearn and re-learn the processes and theywere open to take in ideas from their strategic partners also. Duringdevelopment the company reinvented and minimized the manufacturingprocess, brought in innovative product design, and asked componentmanufacturers to look at current work and design approaches in a differentperspective to produce logical and simple solutions.

 The strategy behind the project was the awareness of the number of Indianfamilies who had two wheeled transport, but couldn't afford a four wheel car,and was based on the company's success in producing the low cost 4wheeled Ace truck in May 2005. The company management learnt andimproved on the design procedure of Ace truck and used this know-how tocome up with the best design for Tata Nano. Also, since both the vehicleswere similar in their basic design and component requirement, the supplierbase was also easier to be put in place.

Even after successfully launching the petrol and diesel variants of Nano, TataMotors have not rested on the laurels. They have taken one step further incoming out with an electric version which enables them to position it as an

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A Four wheeled rural car?

Rolled up Plastic curtains in place of windows?

Openings like Auto rickshaws from the side

A four wheeled open car with safety side bars?But the market wanted a car and if they build a people’s car it should be a carand not something that people would say,“ Ah! That’s just a scooter with fourwheels or an auto-rickshaw with four wheels & not really a Car.”Trying to build a car cheap enough for motorcycle buyers seems to make sensenow but seemed crazy several years ago when Ratan Tata, longtime chairman of Tata Motors , first mentioned his dream of building a one-lakh car in 2003."They are still saying it can't be done," he says, insisting that it can and will.After we get done with it, there will hopefully be a new definition of low-cost."


Before starting the project, Wagh did something no one at Tata Motors everhad: He talked to customers. The three-wheeler men inevitably insisted on acheap, dependable truck that could go from village to market carrying, say, aton of onions or potatoes, one night, as sunset approached, Wagh stuck with onerickshaw driver. He says, "I kept asking the question. Why? Why? Why do youwant a four-wheeler?" Wagh remembered. Finally, he got the real answer. Itturned out it wasn't really a problem of transportation of vegetables “If I had a

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