Ratan Tata, chairman, Tata Trusts and former head of Tata Sons, the holding company of Tata conglomerate, on Wednesday admitted that they had gone wrong in branding Nano as the cheapest car and lost a lot in terms of its success as it created a negative impact on the market.
Addressing students of the Great Lakes Institute of Management here at the convocation, Ratan Tata said the greatest mistake was in the branding of the Nano as the cheapest instead of “most affordable”, which was the intention of the company.
“Nano was made to reach out to people, (but) it never has. It is meant to be reachable throughout India with our dealerships. But we made our bunch of mistakes,” he said.
“We learnt many lessons from the experience,” Tata said advising the students to be firm, bold and adventurous when taking decisions that they think are right.
“The Nano experience in West Bengal cost us one year as we had to shift the factory to another state and in that one year, a lot was lost in terms of perception as our detractors went to town with barbs and criticism, not all fair and correct.”
“But the launch of Nano was a great success, one that went beyond expectations, Tata said.
Ratan Tata, chairman Emeritus of Tata Sons added that "Success comes if one took decisions that one thinks are the right ones.” He also took questions from the students, during the course of which Tata said they were fortunate to get such a good education and tools for advancement and hoped that the students would not fritter them away.
“Especially, the times we are living are so exciting," he said adding that the start-up scenario in India resembled the situation that prevailed in the 60s and 70s in the USA.
He himself has, after stepping down as the head of Tata Sons in 2012, invested in startups, almost all of them in the e-commerce space, an area that he sees full of potential for growth in the country.
“Like everyone, I also look for reasonable returns on investment,” he said. “10 years ago, the same start-ups that are doing well today may not have succeeded,” the business tycoon said.
“What Tata looks for in companies before investing is that whether the company’s promoters were committed to the cause and whether they were in it for the long haul and building an institution rather than exit in short term after making some gains.”
“I would like to support companies that have commitment and those that want to serve the common man, like in the field of health or empowerment of women,” said Tata.
“Yes I do receive a lot of pitches, but I can make out the intent of the promoters when I meet and talk with them. Basically, the companies should have a sense of responsibility and never oversell their idea and do not walk away from it all — after making short term gains," he said.