How Cyrus Mistry is planning to fix what isn’t working at the Tata Group

Cyrus Mistry spent much of the first year as chief of the 92-company Tata group creating a fresh foundation and figuring out what’s working and what isn’t. Now he’s got to begin fixing what isn’t.
Signals from Cyrus

Ok guys, it’s time for business: Mistry needs a few of those glamorous multi-billion acquisitions to deliver. Takes the call to abort Indian Hotels’ much-attempted bid for Orient Express.

Wings for aviation: It was Ratan Tata’s dream, but it was Mistry who was at the forefront of the joint ventures with Air Asia and Singapore Airlines (with Tata’s support).

Find some friends: Mistry has some 25 years ahead of him as chairman and needs people to grow old with him in the office. Much of the first year was spent in building his A team.

Manage retirements: Tata Steel managing director HM Nerurkar retired in October. Choosing a successor in TV Narendran was one of Mistry’s key decisions this year.

Get more women on board: Tata Sons is still a gentlemen’s club. But Mistry is signalling a change in attitude by inducting women on the Tata boards.

Playing Mr Fix-it: Has identified the problem companies — Tata Motors, Tata Steel Europe, Tata Power — and their problem areas.

Not yet ready for banking: Took the strategic call to withdraw Tata Sons’ application for a banking licence — for now.
Back in the ’70s, the families of construction magnate Pallonji Mistry and well-known legal luminary Iqbal Chagla were neighbours in Cuffe Parade. A happy consequence was that in 1992 Pallonji’s younger son Cyrus married Chagla’s daughter Rohiqa. On the wedding day, the father of the bride, Chagla raised a toast, starting with these words: “I was determined to dislike anyone who decided to marry my daughter.”

Then he added a truism: “However, once you meet Cyrus, it is impossible to dislike him.” It still holds two decades later; everybody seems to like the 45-year-old Cyrus Mistry. Mistry took over as chairman of Tata Sons on December 28, 2012. Since then, he has made all the right moves. “He has not taken any giant leaps, neither has he shaken the foundations of the group,” says Harsh Goenka, industrialist and chairman of RPG Enterprises.

As Mistry begins his 12th month as chairman of India’s largest conglomerate, in which his family led by father Pallonji Mistry owns an 18.5% stake, it’s time for him and his core team to prepare a rough and ready blueprint for the second year. That plan may call for a few larger leaps, and may indeed shake some parts of the foundation.

Making the multibillion acquisition of Corus (now Tata Steel Europe) viable, for instance is one of them. Downsizing the business by mothballing some of its capacities, reckon analysts, may be the way to go. Back home Tata Motors — excluding the money-spinning Jaguar Land Rover ( JLR) — needs a refreshed portfolio to find its way back amongst India’s top 5 automakers. And the power, telecom and hospitality businesses too are in need of an overhaul.

It’s a daunting task; more so for a man who’s still coming to grips with a 92-company group across 28 diverse sectors, even as it strategizes to enter newer businesses, like aviation. Ashok Basu, former bureaucrat and an independent director on the board of Tata Power, says: “I think he has the most formidable job in the country. But this mantle sits very lightly on his shoulders.”

“Luckily, his health has held up. He has taken on a punishing schedule, whirlwind travel across the world, day trips to the Gulf countries and stuff like that,” says a person who knows Mistry well. And Goenka adds: “He doesn’t look stressed. But I asked him about his work-life balance and he admitted that’s gone for a six.”

First, a Team

One of Mistry’s immediate priorities after taking over at the helm was to build a team of people who will, like him, be around for some time. Although Mistry was appointed as executive deputychairman of the group in 2011 for five years, and was elevated in 2012, it is likely that Mistry will have this job for more than a quarter of a century.

Before retiring, predecessor Ratan Tata — who had the job for 21 years — had left a clean slate for Mistry, even lowering the retiring age for non-executive directors, to ensure that the old guard goes away in two to three years. Tata’s first few years at the helm were spent consolidating his own position as the undisputed leader of the group and pushing out the veterans. He did not want such distractions for Mistry (after all, Tata had plenty of them when he took over and had to spend at least six of his initial years taking on — successfully — the group’s satraps).

In Madhusudan Kannan, 39, Mistry found his head of business development. Kannan was the first member of team Mistry and joined the group in May 2012, seven months before Mistry finally took over the reins. Kannan is considered closest to Mistry today. Mukund Rajan, 45 — younger brother of Reserve Bank governor Raghuram Rajan — was moved in from Tata Capital as custodian of brands and chief spokesperson as well as chief ethics officer. Mistry also brought in academic Nirmalya Kumar from the London School of Business to help with strategizing and NS Rajan from Ernst & Young as head of human resources. “In many ways it is like Rahul Gandhi’s team” says one uncharitable onlooker from corporate India.

It was Ratan Tata’s dream, but it was Mistry who was at the forefront of the joint ventures with AirAsia and Singapore Airlines (with Tata’s support).
“It has more theoreticians than business managers,” he says. That may be unfair to both Mistry and Gandhi, but one cannot deny that Tata’s own lieutenants were either seasoned veterans from within the group (Syamal Gupta, NA Soonawala, Ishaat Hussain, to name three) or from other large companies (like R Gopalakrishnan from Unilever’s Indian subsidiary). Mistry has chosen his own horses, for surely he has to run on a different course.

The Tata group did not participate in this feature. Also setting himself apart from the Ratan Tata-era is how Mistry has sought to induct more women on the boards of Tata Sons. Vishakha Mulye, managing director of ICICI Venture, was the first woman inducted by Mistry in February. She joined the board of Tata Power.

He followed this up by bringing in Falguni Nayar on Tata Motors’ board and Ireena Vittal, a former McKinsey partner, on the boards of Indian Hotels and Tata Global Beverages (see Diversity Drive). With Vittal, Tata Global now has three women on its board (the other two being Mallika Srinivasan and Ranjana Kumar).

Nayar, who now runs her own e-commerce venture and a former managing director at Kotak Investment Banking is married to private equity fund KKR’s India chief Sanjay. Mistry asked Falguni to drop by for an interview and spent considerable time discussing her current venture before requesting her to join the Tata Motors board and bring her I-banking experience to the table.

In May 2012, before he became Tata Sons chairman, Mistry had joined the board of Tata Steel along with another lady, Mallika Srinivasan, chairman and CEO of tractormaker TAFE.

However, these moves are only a beginning in creating gender-diversity at the house of Tatas, whose boards have traditionally been male bastions; for instance, the jewel in the Tata’s crown, TCS, has an all-male board; and even the Mistry-created four-member general executive council is all male.

There was one more quick response by Mistry that pleasantly surprised many people. When a former executive of Tata Steel committed suicide and there were allegations of harassment by former colleagues, a committee was immediately set up with executive and non-executive directors of group companies to probe the allegations.
Mistry has some 25 years ahead of him as chairman and needs people to grow old with him in the office. Much of the first year was spent in building his A team.
Plumbing the Numbers

The Tata group today is virtually basking in the glory of a single outperformer — TCS, which accounts for roughly 60% of market value of all listed Tata entities and 80% of profits. To that extent, TCS managing director N Chandrasekaran, 50, stands tall — some observers say nearly as tall as Mistry —in the top tier of leadership in Bombay House, the headquarters of the Tata group.

Tata Sons owns almost 74% of TCS; and since Mistry took over in end-2012, TCS’s market capitalisation has gone up by 58% adding Rs 1.4 lakh crore to the group’s market combined capitalization. The other clear outperformer is JLR, the $2.3-billion acquisition that more than makes up for Tata Motors’ dismal show domestically.

JLR’s revenues in 2012-13 were 2.5 times that of the local operations, profits stood at Rs 10,406 crore as against Tata Motors’ domestic profit of Rs 302 crore, and, for good measure, the UK operation headed by Ralf Speth paid Tata Motors Rs 1,420 crore in dividend in June. Together Tata Motors and TCS account for roughly 80% of the group’s combined market value. The rest of the 26 listed group companies taken together have actually shrunk in combined market capitalization.

The Indian operations of Tata Motors and European operations of Tata Steel may be the larger problems, but Mistry has more fires to douse. Basu, for example, feels the biggest problem is at Tata Power. The company has posted a loss of Rs 39 crore for the first half of 2013-14 after a loss of Rs 85 crore for 2012-13.

“Tata Power is probably his greatest headache — a problem created for no fault of the company. Take Mundra ultra mega power plant, for instance, which is suffering because the price of Indonesian coal has suddenly shot up and the state government cannot buy power at this price.”

Then there is Indian Hotels, which was in the red to the tune of Rs 452 crore for the first half of 2013-14 on revenues of Rs 1,804 crore. The loss in this half year has exceeded the loss of Rs 430.24 crore of the entire previous year. The Tata Group is not a six-course meal but more like a tasting menu and there’s a lot more on Mistry’s plate. The telecom business needs some decisions — especially as Tata Sons may need to buy back the 26% stake of Japanese partner DoCoMo in March 2014.

Vatican Redux

Clearly, taking charge of an illustrious company incorporated back in 1917 is not easy. In many ways Tata Sons reminds one of the Vatican. If you go through its archives and treasures, you come up with surprises. Like for instance, at Tata Sons, the equity capital with voting rights adds up to only Rs 40.41 crore.

However, there are preference shares without voting rights that account for 100 times the amount at Rs 4,148 crore. These attract dividends at a fixed rate of 7.5% and the subscribers to the preference shares are mostly directors of the company and former directors and sometimes even unrelated professionals. In May 2013, Cyrus Mistry subscribed to preference shares worth Rs 1 crore (10,000 shares). R Gopalakrishnan, non-executive director invested Rs 6 crore in preference shares of Tata Sons in June 2013.

In July Ratan Tata acquired Rs 8 crore worth of preference shares while NA Soonawala (also a former director) picked up Rs 1.5 crore worth of preference shares in July. Let us take the analogy of the Vatican of this day a little forward. The Catholic Christian church has a new Pope today, but the old Pope is not dead — and in fact is living in the vicinity. Mistry heads Tata Sons, but Tata is not very far away. He is available — as he was in the run-up to the aviation joint ventures with AirAsia and Singapore Airlines.

Also, don’t forget that Tata, now chairman emeritus, heads the Tata trusts that control around 65% of the equity shares of Tata Sons and by virtue of that holding controls the group while remaining in the background. Mistry may well be the proverbial chip off the old block. Basu says that while he brings in “youthful energy” to meetings he is very much similar to Tata in his manner, listening carefully and giving his opinion in the end. He has, for instance, suggested strong belt-tightening measures for the group and has also suggested that Tata Power seek a global footprint for itself.

Nayar adds: “It seems right now he is listening and absorbing. I find Mistry to be very open and inclusive. He is also a very good listener and carefully evaluates everything before taking decisions. He also has a vision which he explains.” That is what Tata was known to do. And Mulye points to other similarities with Tata: “He has a unique capability in combining breadth of vision at one end and granularity of detail at the other. The other big quality he has is his sense of humility.” It would then appear that Mistry has moulded himself in the cast of Tata, what with both of them evidently also sharing an aviation dream.

A former senior executive at one of the Tata companies who did not want to be quoted says that the Tata influence on the group is still very strong — along with the influence of RK Krishna Kumar who retired in July 2013. Many of the CEOs of today are former executive assistants of the two senior pros, both of whom are trustees on the Tata Trusts (Mukund Rajan in the GEC and N Srinath, MD, Tata Teleservices aided Ratan Tata, while Avani Saglani Davda, CEO, Tata Starbucks and Govind Sankarnarayanan, CFO, Tata Capital were EAs to RK Krishna Kumar).

But herein may lie the rub, point out analysts. The tough decisions that await Mistry may be construed as going against Tata’s legacy. For instance, what’s the future for the ultra low-cost car, the Nano, which was Tata’s dream (although a few days ago he did clarify that his ambition was not to build a ‘cheap’ car but one that would be a logical step up for the country’s millions of twowheeler riders)? Similarly, the options for Tata Steel Europe — an acquisition that a section of analysts believe was overpriced but which Tata believes had to be made — are grim, with some analysts advocating sales of substantial parts of the business, if not all of it.

Mistry and Tata have been on the same page — even before the former took charge as chairman. For instance, Mistry bought a Nano as soon as it was launched, and apparently said: “It is a damn good car.” The question, of course, is for how long can Mistry be on that same page. At some point he will have to differentiate himself in style and substance from Tata in key strategic decision-making. Mistry has shown he is capable of those tough decisions.

The $1.6-billion write-down of Corus’

goodwill on Tata Steel books earlier this year — that contributed in a big way to the losses — the recent withdrawal from the race for a banking licence and the recent call to abort Indian Hotels’ bid for Orient Express are three instances. Expect a few more in the second year which, for Cyrus Mistry, will be more important than his first.

The Aviator’s Busy Flight Path

For Ratan Tata, retirement may not necessarily have translated into less work and for sure has resulted in more than usual travel. A person familiar with his schedule indicates that Tata has been travelling a lot more since he retired. For starters, Tata serves on the Prime Minister’s Council on Trade and Industry, which means he continues to advise the top political leadership of the country.

That apart he is also the president of the Court of the Indian Institute of Science and chairman of the Council of Management of the Tata Institute of Fundamental Research. He also serves on the board of trustees of Cornell University and the University of Southern California. Tata had graduated as a trained architect from Cornell. However, retiring from Tata Group companies — he is now chairman emeritus — is not the end of the corporate innings. For example, even now he continues to serve on the board of American aluminium major Alcoa. He is also on the international advisory boards of Mitsubishi Corporation, JP Morgan Chase, Rolls-Royce, Temasek Holdings and the Monetary Authority of Singapore.

In September Tata also joined the board of trustees of Carnegie Endowment for International Peace. This trust is considered a premier American think tank. However, at the same time Tata has kept himself available to the Tata Group and in the beginning he had committed himself to fortnightly lunch meetings with Cyrus Mistry. Apart from that he is closely involved with the aviation joint ventures of the Tata Group, one with AirAsia and the other with Singapore Airlines. Tata himself had piloted a flight with the AirAsia team on board to Delhi.

It is likely that some of the Tata companies may still consult him for his expertise, in specific areas like automobiles and aviation. He also heads the Tata Trusts which control a two-thirds majority of shareholding at Tata Sons and this must be taking up a lot of his time. He had also registered his own company RNT Associates with RK Krishna Kumar. But not much else is known about its activities. Not yet.

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Ratan Tata’s grace and wisdom moved me: Starbucks CEO

Starbucks CEO Howard Schultz has voiced his admiration for industrialist Ratan Tata’s grace and wisdom, saying he was moved by the business icon’s words during the launch of the coffee chain’s flagship store in Mumbai last year.

“At the celebratory dinner the night of the Mumbai (store’s) opening, Ratan Tata offered a toast that really moved me,” Schultz writes in an essay in the book ‘Reimagining India: Unlocking The Potential of Asia’s Next Superpower’, edited by global consulting firm McKinsey.

Mr Schultz recalls that while describing Mr Tata’s remarks later on to a gathering of his company officials in the US, he began to cry.

“A few weeks after returning from the opening of our Mumbai store, we held one of our big open forum meetings where we get the entire company together. And as I tried to describe that moment for everyone, something came over me. I started to cry. It just hit me emotionally.

“In India we’d had a chance to do something extraordinary, something truly world class. And I am excited that we have a chance to grow and give back in a land where so much opportunity lies ahead and to contribute to making it a little better place than the one we found,” Schultz said.

Mr Tata’s remarks on the night of the Mumbai opening were “perfect and so heartfelt,” Mr Schultz said in the essay, adding that he considers Mr Tata to be a “man with so much grace”.

“I could sit and listen to Ratan Tata for days on end. He has so much wisdom and insight not only about India but about the world,” he said.

The book is a compilation of over 60 essays on India’s challenges and opportunities written by CEOs, academicians, economists and historians, including Wipro chief Azim Premji, Microsoft founder Bill Gates and India’s chess legend Viswanathan Anand.

In his toast, Mr Tata had said in his “dry, understated way” that the Tata group has had a bit of success in the various endeavours it has undertaken over the years.

“We have partnered with some good global companies. But I have never had the kind of recognition I have received from this relationship with Starbucks. People I have never met stop me on the street just to congratulate me.

“And what I have learned from this relationship is that Starbucks is far more than just a company that sells coffee,” Mr Tata had said.

Mr Schultz said his company has developed an “incredible relationship” with the Mr Tata’s organisation and he could not imagine bringing Starbucks to India without the assistance it has received from Mr Tata.

Mr Schultz also said India is the only major market in the world where Starbucks has been able to source and roast coffee beans locally.

The company worked with Tata officials on an India-only espresso roast designed specifically for the Indian market. He said people in Starbucks’ coffee department were not “exactly thrilled” when he told them he was looking at a different approach to sourcing coffee and roasting process under the partnership with Tata for India.

“They were more skeptical when I said we want to create a different blend of coffee for India,” he said, adding that his team was incredulous when he said the India blend was not going to be roasted by the Starbucks team, a first in Starbucks’ 42 year history.

Mr Schultz said to get the blend he wanted for India, “we’d have to share with Tata some of the family jewels – roasting secrets we’ve perfected over four decades and guarded very closely.

“It was a real test of our trust in our new partner,” he said, adding that teaming with Tata to come up with an Indian roast was a huge step for Starbucks.

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All you wanted to know about Cyrus Mistry

Cyrus Mistry is 44 (Ratan Tata was 54 in 1991 when he took the mantle at Bombay House).

A commerce graduate from the University of Mumbai, he has an engineering degree from the Imperial College, London, (1990) and a masters in management from the London School of Business.

Mistry joined the board of Shapoorji Pallonji & Co—a firm that his grandfather founded—as director in 1991. Three years later he was appointed managing director of the Shapoorji Pallonji Group.

Under him, Shapoorji Pallonji’s construction business grew from a turnover of $20 million to almost $1.5 billion.

Mistry oversaw the diversification of Shapoorji Pallonji & Co from construction to design and building of complex projects in the marine, oil and gas and rail sectors. The group employs over 23,000 people and has a presence in India, the Middle East and Africa. Thus he has experience in construction, entertainment, power and finance.

He has served on the board of Tata Sons as director for five years; was also member on Tata Elxsi and Tata Power boards. He was also a senior vice-president of production, DQ Entertainment.

He is the sixth chairman of the Tata group, after Jamsetji Nusserwanji Tata, Sir Dorab Tata, Sir Nowroji Saklatwala, JRD Tata and Ratan Tata. Mistry is the second of them to not have Tata name.

With about 18 percent stake, Shapoorji Pallonji Group is the largest shareholder in Tata Sons. Mistry thus also represents the largest shareholder of Tata Sons.

Mistry’s sister Aloo is married to Ratan Tata’s half-brother Noel Tata, who himself was a contender for the coveted chairman’s post.

As chairman, he is to head a group with presence in more than 80 countries across six continents with exports to 85 countries. It has seven core areas of businesses such as information systems & communications, engineering, materials, services, energy, chemicals and consumer products.

The group’s turnover as of now is Rs 475,721 crore or $100.09 billion, of which 58 percent comes from overseas.

The group has 32 companies publicly listed and has a combined market capitalisation of about $88.82 billion and a shareholder base of 3.8 million. It has over 450,000 employees.

When Ratan Tata took over as the chairman in 1991, the group had a turnover of $10 billion.

Mistry was chosen by a five-member selection committee, whose members include Lord Sushanta Kumar Bhattacharyya who runs Warwick Manufacturing, lawyer Shirin Bharucha, and N.A. Soonawala, vice-chairman of Tata Sons.

Apart from Noel, other contenders to the post included NR Narayana Murthy, Founder and Chief Mentor, Infosys, and Indra Nooyi, CEO, Pepsico.

Mistry is the richest board member of the group’s IT flagship TCS. He holds around Rs 500 crore of its shares, according to a disclosure made on April 2.

The TCS annual report 2011 shows Mistry’s holding in TCS is higher than that of Ratan Tata, who holds around 1.5 million shares.

He stays in a sea-facing house, also inhabited by his father and elder brother, Shapoor Mistry, in upscale Malabar Hill.

He is married to Rohika, daughter of legal luminary Iqbal Chagla.

Mistry loves horse-riding and is an avid golfer.

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How Ratan Tata Made the Bumblebee Fly

One of the myths of aerodynamics is that the bumblebee cannot fly, given their body structures, wing sizes and other shortcomings. But they do fly.

Given the laws of Indian corporate dynamics, and the poisonous hand of government, the House of Tata should have been extinct by now. The singular achievement of Ratan Tata, who turns 75 tomorrow (28 December) and who will be formally handing over the reins of power to Cyrus Mistry as Chairman of Tata Sons, is to prove everybody wrong. He has proved that the Tata Group can not only fly, but also grow additional wings to spread itself all over the globe.

It is customary to discuss the successes and failures of iconic people when they are about to retire. This article will do some of that, for sure, but would actually like to look beyond the individual and consider the circumstances in which Tata achieved his successes, and account for his occasional failures. This is because success is too easily attributed, after the event, to an individual’s vision, ability or actions. But luck and circumstances always play a part.

Ratan Tata’s achievements are simply put: In 21 years, he has welded the Tata group into one fighting force

No laurel wreath

Ratan Tata’s achievements are simply put: In 21 years, he has welded the Tata group into one fighting force, with a strong group identity, something that may not have been possible for any other person to do.

Consider the group he inherited. Under JRD “Jeh” Tata, the group was held together by the sheer personality of Tata, with minimal shareholding power. JRD could have chosen anybody for a successor–Russi Mody, Darbari Seth, Sumant Moolgaokar, Ajit Kerkar, AH Tobaccowala. Every one of them had more laurels to their credit than Ratan Tata, who, even at the time of his anointment as Tata Sons Chairman in 1991, had nothing much to show for–a small Nelco turnaround, some ideas for Tata Industries.

So why did JRD choose Ratan? Possibly for two reasons: the Tata name, and the belief that Ratan had the clarity of thought and toughness of spirit to do what was necessary to stitch the group together in adverse circumstances. Ratan could do what JRD could never have done.

Given the power of the Tata satraps, only someone with a Tata name could have had the moral authority needed to get the Tata trusts to back him in his efforts to consolidate group shareholdings, and drive out the non-conformists. In due course, Russi Mody and Kerkar had to be driven out, and the other two did not survive long enough to pose a challenge.

That JRD chose right is evident not only from the size and scale the Tata group has grown to under him, but from how Ratan Tata is himself handling his succession. He, too, could have chosen his half-brother, Noel Tata, and nobody would have demurred. When JRD chose a Tata, what would have been wrong in Ratan choosing another Tata to run the group?

Tough mantle

But this is Ratan Tata’s own genius. He knows the group is vastly different now. It is held together by strong core shareholdings, and its sheer size and global presence–over 100 operating companies in 80 countries—makes it impossible for one individual to personify the group even with the Tata name. His choice for succession was Cyrus Mistry, son of construction magnate Pallonji Mistry. Ratan Tata is not choosing a clone to succeed him.

Tata’s shoes will be difficult ones to fill for Mistry, but Tata has managed to change the game subtly. Mistry may not have the Tata name, but he is the biggest shareholder in Tata Sons. That counts. More important, it is no longer possible, or even desirable, to run the group like Ratan did.

Given the diversity of the group —from steel to automobiles to software to beverages and many more things—the Tatas may actually have to revert to the old JRD scheme of running the group—develop professional managers who will act in the interests of the company, even while maintaining the group’s identity. There will be no satrapies, only professionals who will not threaten the group identity. Ratan Tata’s own example of stepping down at 75 ensures that no satrapy can ever develop. The norm has been reinforced.

So, while Mistry is the chosen man, Ratan, meanwhile, will continue to be a presence on the various Tata trusts, which control Tata Sons with a 66 percent shareholding. And Ratan Tata is not resigning as chairman of the various Tata trusts. He will remain like a super-shareholder of Tata Sons, even while letting Cyrus make his moves. Big Brother may not be boss, but he will be watching. And let’s not forget, if Cyrus stumbles—but then Ratan Tata is still around—there is always another Tata waiting in the wings—Noel. Ratan Tata’s succession strategy has a second string to his bow.

If the handling of succession has sent a strong signal of continuity and change, there’s still the matter of assessing Ratan Tata’s own tenure for its high points and low points.

Instinct play

Let’s be clear. Tata did not get everything right. With hindsight it is always easy to congratulate him for his big global vision–the acquisitions of Jaguar Land Rover, Corus, Tetley, Daewoo, etc–but whether at home or abroad, not all his bets worked. And not all his business instincts were right.

For example, Ratan was not sure Titan Watches was the right thing for Tatas to get into, but his managers managed to pull off one of the biggest successes in a consumer-facing industry. Ratan’s part in the success is that he did not let his instincts stand in the way of professionalism.

Tata probably sold his FMCG company—Tomco—to Hindustan Lever at a rock-bottom price in the early 1990s, when it could well have been built it into a true powerhouse.

The group’s foray into telecom has also been underwhelming. After entering late, it is nowhere in the Top 5 and could be a ripe candidate for exit when the industry consolidates.

His Corus acquisition looked great when the world was booming; now, when Europe is in trouble, the debts are huge and Tata Steel is struggling to make it all work.

The JLR acquisition worked like a dream—but not for the anticipated reasons. When Britain’s largest manufacturing company was put on the block, the Tatas were reckoned to have a paid a big price for a loser. But the rise of China, and the revival of the luxury market, paid off. Lady luck smiled at the right time here.

On the other hand, Ratan Tata’s biggest dream—the Rs 1 lakh car—turned out to be neither worth Rs 1 lakh nor was it a knockout in the marketplace. The Tata Nano got rave reviews from the global media when unveiled four years ago, but it will need a huge makeover before it can fly. It’s the bumblebee that hasn’t yet managed to fly. It’s not to right to write it off as yet, but it will take some time to fix the problems with the car.

If you add up Ratan Tata successes and deduct the failures, you still get a positive number. And the biggest reason to celebrate this fact is that he did it in India—where success has largely gone to people with the best political connections.

But the bottom-line is this: it is not right to judge Ratan Tata’s contributions by adding up the successes and deducting the failures. He achieved something the numbers cannot capture. He made the whole greater than the sum of the parts.

Ratan Tata is unique because he managed to fly in India without the wings of political influence. In this, he has done much better than the bumblebee.

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Tata Group named India’s best known global brand

As Ratan Tata steps down and Cyrus Mistry steps in at Bombay House Friday, top CEOs of the world have said the $100-billion Tata Group is India’s best-known global brand within and outside the country.

“Ratan Tata occupies the well-deserved iconic status who has taken the group from largely an Indian family-owned business house into a professionally managed global conglomerate,” a survey by Assocham said.

About 77 percent of those who participated in the survey said they are confident Mistry will be able to steer the group well, it said.

Assocham said it has surveyed about 78 top CEOs and heads of both domestic and foreign companies in the first fortnight of December.

The survey, it said, was conducted not only in Delhi, Mumbai, Kolkata and Hyderabad, but also in London, New York and Singapore.

However, the respondents said the biggest challenge for Mistry would be to ensure that the Tata companies are able to sail through the global slowdown, since the group operates in some 80 countries, several of which are in the grip of difficult times.

The group has interests in steel, automobile, chemicals, telecommunication, information technology, beverages and hospitality, among other areas.

“The Tata story which began in 1868 by Jamsetji N Tata has been the most successful among India Inc. The role played by Ratan Tata and J R D Tata in making the group truly global has been deservedly recognised all over the world,” Assocham President Rajkumar N Dhoot said.

Infosys Technologies, Wipro, Mahindra & Mahindra and Aditya Birla Group were the other major Indian corporate houses listed to have made their mark on the global business landscape, the survey said.

However, it said the brand Tata stood out among all the top Indian corporates and perceived as the truly international brand.

It said while the change of guard at the Bombay House, the headquarters of the Tatas later this month, is on the corporate calendar and the event would go down as a landmark occasion among the most watched for several years.

Ratan Tata, after being at the helms of affairs for 21 years at Tata Sons, the holding company of the group, will be retiring on 28 December.

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Tata eyes Ethiopia’s tea sector

The Tata group revealed plans to grow tea in Ethiopia. The corporation has expressed interest in tea farming in Ethiopia said Esayas Kebede Director of the Ethiopian Ministry of Agriculture and Rural Development.

The Ethiopian authorities are in dialogue with Tata according to Esayas. Tata, owner of ‘Tetley’ tea brand, has ventured a proposal he added. Ethiopia has land suitable for tea cultivation according to Esayas.

Favorable land and labor costs area available to Indian companies wishing to invest in the agriculture industry Esayas explained. Bilateral trade between India and Africa have increase significantly and in Ethiopia, approximately 70% of 40,000 hectares designated for contract farming has gone to Indian companies, he added.

Increasing its investment presence in the African continent is a wise decision for Tata, The expansion allows it to take advantage of newly created opportunities and helps cut down custom and excise on imported goods according to regional sources.

Tata Africa Holdings (SA) Pty Ltd has a presence in 10 countries of the continent in sectors as varied as information technology, communications, automobiles, steel, hospitality, consumer products and chemicals.

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Ratan Tata beats PM, Pope & the Queen in reputation

Ratan Tata’s reputation, it turns out, is bigger than that of Manmohan Singh and the Pope. Indeed, the Tata Group boss is a more liked, respected, admired and trusted personality than the Queen and David Beckham of the UK, says a new global study. Tata, whose shopping bags in Britain are stuffed with two iconic marques, a tea brand and a steelmaker, has also finished ahead of that country’s richest man, LN Mittal, and its premier, David Cameron, shows the study of more than 50,000 people in 25 countries.

Tata is ninth in the 2011 Leader RepTrak, which assesses the reputations of the world’s 54 most visible public figures in politics, business, culture and sports. He ranks high alongside other business visionaries such as the philanthropic duo of Bill Gates (3) and Warren Buffett (4) and the entrepreneurial duo of Richard Branson (5) and Steve Jobs (6) in the study conducted by Reputation Insitute, a global private consultancy.

The list is topped by South African icon Nelson Mandela and Roger Federer. The tennis superstar hasn’t had the best of years in 2011, drawing a blank in the Grand Slams and developing a growing habit of bowing to Novak Djokovic and Rafael Nadal, but his reputation in the public remains as spotless as it was in the zenith of his career. In contrast, golfer Tiger Woods, who has received much ink for his tales of infidelity, has fared badly in the list, languishing at 47. The public has given its weakest ratings to leaders cast as “anti-democratic”.

North Korean dictator Kim Jong-Il took last place in the study while Zimbabwe’s Robert Mugabe is at 48. That’s not to suggest that politicians have fared a lot better. The ratings of US president Barack Obama (14), Singh (27), Cameron (34) and Russian premier Vladimir Putin (44) indicate that the public views the group with distrust . Indeed, “the broadest lesson from the study is that the public tends to be critical of leaders” , says Reputation Institute.

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