Analysis of risk management by Indian firms: The Tata perspective

Abstract

Indian organizations have increasingly started assigning resources – manpower, financial and technical for the management of risks like health, livelihood and security faced by the stakeholders in contact with the organization. The organization has the task of balancing the risks of employees and customers. More importantly, the organization has to mitigate the risks faced by customers. Hence, organizations have been very active on this front. The mitigation of the risk is important for the firm to implement the aspect of “sustainable development”. The revolution of risk management has been supported by the media, the legislature and judiciary. Our project is based upon how organizations manage their risks. For our analysis, we have taken Tata as the model firm. We have analyzed the initiatives taken by Tata to manage risks. We have elaborated in detail the CSR policies, initiatives, the welfare organizations and the community welfare organizations setup by Tata to better the lives of people. We have gone on to discuss the organizations where risk management by Tata has been of primary importance. As a study of the issues of current importance, we have analyzed the cases of Singur in West Bengal and Kalinganagar in Orissa. We have tried to identify the issues faced by the common man, the build-up of the issue and the role of the media, politicians, NGOs and celebrity activists in the events which unfolded. We have highlighted the initiatives Tata took to make Jamshedpur a model city. Tata has been a bright example of how an organization should handle the risks associated with its business setup in a particular city. We have concluded by providing an insight into what firms need to do to mitigate the risks faced by people who are in direct contact with organization. We have also suggested recommendations for firms, governments, media and NGOs to ensure that the risks of common people are not compromised. We firmly believe that above stakeholders need to actively look into management of health, livelihood, security and other risks. This will not only ensure that the firm’s attention is not restricted to profitability and market share, it will also set the trend and framework for future firms to follow.