There is something Cyrus Mistry has done at the Tatas, long before he became chairman of the group, which is rare among Tata honchos. He was involved in building Tata factories around the country. Old hands at Tata Motors recall Mistry personally supervising the construction of Tata Motors factories at Pantnagar in Uttarakhand and Sanand in Gujarat.
Mistry was present there, as managing director of Shapoorji Pallonji & Co Ltd, which has been the contractor for building a host of Tata factories across the country. When the Nano plant was shifted from Singur in West Bengal to Sanand, Mistry had already joined the Tata Sons board. Rebuilding at Tatas is not new to Mistry.
While Sanand was completed in 2009, in 2013 Mistry, as chairman, has another rebuilding task ahead of him at the Tata group. This time his work is cut out at the top of the century-old group. Sources close to the group say that one big reason for Mistry dismantling the old twin-bodied management structure and creating a unified one with new hands on deck is the fact that Mistry apart from being chairman is also now the only executive director on the board of Tata Sons, the group’s primary holding company.
“There is a need for a body of executives to work with the chairman,” says a person familiar with the matter. It is this need that drove the creation of the Group Executive Council (GEC) comprising Mistry, Madhu Kannan, Mukund Rajan and NS Rajan, for now. The last named is yet to join up at Tata Sons, his first day being May 9, 2013.
The move has resulted in the abolition of two other bodies, the Group Executive Office (GEO) and the Group Corporate Centre (GCC), their members remaining in Tata Sons as non-executive directors. Like today’s GEC, these two bodies were also children of necessity.
The GEO was created in 1998 by Ratan Tata after the powerful satraps like Russi Modi and Ajit Kerkar had exited the group, to support Tata in executive functions. It had Kishore Chaukar, MD Tata Industries, along with R Gopalakrishnan and Ishaat Hussain, both executive directors of Tata Sons on it.
The GCC came in 2002, around the time Tata gave up his executive role to become non-executive chairman. The GCC had all the GEO members plus senior non-executive directors of Tata Sons like RK Krishna Kumar, JJ Irani and NA Soonawala.
Irani and Soonawala retired last year, and Krishna Kumar retires later in 2013. Gopalakrishnan has three years to go, Chaukar has retired and is now on the boards of a few group companies and Ishaat Hussain is now a non-executive director at Tata Sons.
This spate of retirements, and ones that are impending, is something that will ensure Mistry’s hands are full for some time. Right now the group is looking for a chief of finance to take over the role of Hussain. The Group CFO will also be a member of the GEC and external and internal candidates are being considered for this post.