Not many outside the corporate world know about Tata Strategic Management Group (TSMG), one of the largest Indian owned management consulting firms in South Asia. It is headed by Raju Bhinge, its chief executive officer. To understand TSMG's role better, R N Bhaskar spoke to Bhinge who specialises in strategy formulation, portfolio review and public policy. Excerpts from the interview:
How do you see the role of TSMG within the Tata group? How has it evolved even as the group too has tried to reinvent itself to suit changing times?
We began to have a distinct identify only in the early 1990s. Prior to that, we were more like a corporate planning department in the large group. We conceptualised new ventures and interacted with potential partners. In 1991-92 we became a consulting group in charge of strategy and business planning. Michael Porter’s concepts were quite popular then, and we saw the need to focus on competitive advantages the group enjoyed, and to work with companies both within and outside the group.
But your role got sharply defined only towards the end of the 90s, right?
Yes. The group office concept had just been formed, and rules were formed for all group companies to adhere to specific norms like return on equity and net worth, or evaluating the cost of capital that group companies required. We had to keep on reinventing our role depending on the needs of both the companies and the group itself. We had to come up with new solutions for newer and more complex problems. Once we had the answers, the internal corporate teams did the rest. We had to design a permanent renewal; and while marketing itself was looked after by the respective companies, we had to design strategies for micro-marketing in specific states.
Can we have some details about how big you are, your revenues and the source of your income?
We do not discuss our turnover. All I can say is that we earn 50% of our income from companies outside the Tata group. Around 10-15% of our income is designated in foreign exchange earnings – either because they are exports or deemed exports. And our headcount includes 60-70 professionals. When it comes to companies, both within and outside the Tata group, we compete against other global players on an even footing.
Companies like TCS do not have an education vertical. But you specialise in offering consultancy in the field of education. Why the divergence?
I cannot speak for TCS, but you must bear in mind that they look at other sectors. And when TCS looks at BFSI (banking, financial services and insurance) it also looks at training modules in IT and BPO (business process outsourcing). We, however, look at education from the social side, like we do healthcare, nutrition and water. And now that CSR (corporate social responsibility) spending has become mandatory, we have begun working on this along with Tata group companies and trusts. We see the need to make a major social impact. We are aware that government expenditure in these areas is vast, and we are quite small. So we must strategise and take up projects that can make a big impact and also reflect on the group itself. Traditionally, we have never measured for impact, now we see a need to. Just like Gates Foundation. That is what we are trying to do with drinking water. And that is what we hope to do in education as well.