In the previous article, we looked at how “story” forms an important element of an evolving business model. Adapting the story as we understand market and technology better is an important aspect of business model exploration. Let’s see how “Tata Nano” story evolved over the past 6 years. We will see the remarkable difference between “Rural car” to “Global car” story and how the “open distribution” model took a back-seat after Singur trouble and perhaps the downturn. (source: Tata Nano compiled by Pradeep Thakur).
Four wheel scooter version (2003): Ratan Tata says – The two wheeler image (with the family of four) got me thinking that we needed to create a safer form of transport. My first doodle was to rebuild cars around the scooter, so that those using them could be safer if it fell. Could there be a four-wheel vehicle made of scooter parts? Nikhil Jadhav, an industrial designer part of the initial four member team recalls, “It began as an advanced engineering project. The idea was to create a low cost transportation with four wheels. It was not even defined as a car”.
Rural car version (2004): A door-less car with a bar as a safety measure, having soft doors in vinyl with plastic windows, a cloth roof, two big doors (stead of four). Conclusion after seeing the concept designs: The market does not want a half-car, it wants a car.
Global car version (Jan 2008): Who might be the buyer of this small car? Ratan Tata articulates three personas (1) If I were to look in the
Open distribution with toolkit (Jan 2008): In Rata Tata’s words – My aim was that I would produce a certain volume of cars and then I would create a very low-cost, low break-even plant that a young entrepreneur could buy and that a bunch of young entrepreneurs could establish an assembly operation. Then Tata Motors would train their people who would oversee quality assurance and they would become a satellite assembly operation for us. We would produce all the mass items and ship it to them as kits so it’s similar to an SKD or CKD operation. The assembler would also be the dealers for the car and thus we would eliminate one level.
Distribution – latest version (Jul 2009): Ravi Kant says in his interview (ET 10 Jul 2009) – I am afraid we have not made much progress on that (open distribution) front because we got caught in creating a factory in