Tata Group shows the way in managing M&As

The Tata Group believes that its experience in integrating global acquisitions can provide lessons for other Indian companies.

Retaining the senior management of acquired companies has been the cornerstone of the company's strategy, be it in case of Daewoo's commercial vehicle business in South Korea, the tea company Tetley or the steel maker Corus.

''We have retained the management to provide the touch and feel, and integrate through an integration team. This is contrary to the traditional American approach where a transition team descends on the target company,'' said Tata Group Chairman Ratan Tata.

''The key to the success of these investments lies in how well we can integrate the two organisations and cope with the new culture,'' said Alan Rosling, director, Tata Sons.

The Tata executives were speaking at the 'UK-India Conference: Partners in Globalisation' on Tata's experience in Britain.

The group's senior management team already has an international flavour with people such as Alan Rosling and the management in acquired companies.

''We are breaking new ground. In the future, nationalities will play a reducing role in each of our companies,'' said Tata. TCS today employs more than 100,000 people, who work seamlessly across geographies, added Rosling.

Success in integration also lies in the homework that one does in assessing the cultural fit of the target company.

''What is not known or seen is that for every acquisition we have done, we have spent enormous amounts of time in assessing its value systems and ethos, and ensuring that they are not in conflict with ours,'' said Tata.

The group is already trying to leverage its global skills and know-how. Take the case of new product development in automobiles.

Tata Motors has a European development centre in the UK, a truck development centre at Daewoo in Korea and bus development centre in Spain. These are networked with the company's three centres in India.

''We are trying to leverage skills from across the world,'' said Ravi Kant, managing director, Tata Motors.