Tata Steel Strength Analysis

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The Tata Steel have its own strengths and weaknesses. Internal Factor Evaluation (IFE) matrix is a tools included in first strategic planning which are strategy formulation that summarizes and evaluates the major strengths and weaknesses in the functional areas of a business. This tools are to provides a basis for identifying and evaluating relationships among those areas. The strengths of tata steel are capacity expansion, self sufficiency in raw materials, strong retail and distribution, adequate internl control system, advanced R&D, aggresive mergers and acquisitions, divesified product portfolio and commitment to sustainability. While the weaknesses of Tata steel are operational efficiency not very good, lagging in technological front,…show more content…
Next, for the weaknesses, the most problem to overcome are high debt loads, less product innovation and high attrition because it have the lowest rating in IFE matrix. In high attrition, Tata steel has traditionally face the brunt of high attrition rate.In its Jamshedpur plant many engineers constantly change their jobs to SAIL in Bokaro and vice-versa. Thus the formation of a core team of capable individuals across all departments is very difficult as the size of the team is ever changing. Then, because of less product innovation, Tata steel group focus in innovation in future to help the company improves its product and services and solution to satisfy customer needs. An interactive Open Innovation initiative has been launched by Tata Steel for the sharing of new ideas to create the next generation of steel and improve the processes used to make…show more content…
Next, for the threat, the most problem to overcome are technology risk. The rating is 1 and weight score is 0.15. A key challenge for the company is to ensure that its plant are equipped with updated technology in order to serve client and secure cost competitveness. Continous R&D effort ,with the support the Technology Group are aimed at advance position in technology for both product and processes. Next, the strategy that the Tata steel has been take for improving the business are Joint Venture and partnering, merger and acquisition, outsourcing, private equity acquisitions and being first mover advantage. Amongst of the strategy listed, only one that are most important for Tata steel.The strategy choosed is merger and acquisition. The example of acquisition in Tata Steel are : • NatSteel in 2004 -Tata Steel agreed to acquire the steel making operations of the Singapore-based NatSteel for $486.4 million in cash. • Millennium Steel in 2005- Tata Steel acquired a majority stake in the Thailand-based steelmaker Millennium Steel for a total cost of $130
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