Business Case Studies, Leadership Case Study, Tata Group,Ratan Tata

Code : COM0263

Year : 2012

Industry : Power

Region : USA

Teaching Note:Not Available

Structured Assignment :Not Available

Abstract: In 2011, Bharat Heavy Electricals Limited (BHEL), an integrated power plant equipment manufacturer and the 12th largest power equipment manufacturer in the world, faced stiff competition from Chinese power equipment players. The Chinese players, who had had little or no presence a few decades ago, had taken away a 50% market share from BHEL in 2011. But BHEL had still been earning profits continuously since 1971-72. However, analysts pointed out lot of weaknesses in BHEL like capacity constraints, outdated technology, improper capacity management, etc. despite its strengths like quality and customized equipment manufacturing capability and operating efficiency, etc. as compared to the Chinese players. In addition, Indian power companies’ struggle to get finance for their projects helped Chinese companies to gain a strong foothold in India. So, BHEL started losing to Chinese rivals from the year 2000. BHEL initiated a few strategies like setting up a finance subsidiary, increasing capacity, introducing new product variants, etc. to beat the competition. But experts wondered whether BHEL would be able to successfully meet the competition from Chinese players or whether it would lose its momentum of growth in the future.

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