June 04, 2006 | The Week
Motor and SteelWith the legendary J.R.D. Tata at the helm and many titans in command of various Tata group companies, Ratan Tata, son of Soonoo and Naval Hormusji Tata, made a quiet entry into the group in December 1962. JRD assigned him to various companies before appointing him director-in-charge of Nelco in 1971, and later to the ailing Central India Textiles. Ratan turned it around quickly.
The architecture graduate from Cornell University had worked briefly with Jones and Emmons in Los Angeles before returning to India. He also completed and advanced management programme at Harvard Business School in 1975.
His architect training and love for order and planning shaped his meticulous journey in Tatas. Along the way, he confronted several bigwigs who had made leading group companies into personal domains. It was a fight to save the Tata brand and keep the corporate jewels together.
Ratan became chairman of Tata Industries Ltd. in 1981 and was responsible for transforming the company into a group strategy think-tank, and as a promoter of new ventures in high technology businesses. Today, the group has a strong footing in these areas, a tribute to his endurance.
If anyone thought that the young Tata was a pushover, they soon learnt otherwise. He not only cleansed the top echelons of the company, but cropped the large workforce that was bleeding it. He exited many non-core ventures and sold off real estate assets. The prolonged battles hardened him.
Ratan's vision, in simple terms, was to modernise the group, its image and to set foot in the global arena. He trod softly, taking care not to shake up the foundation laid by his illustrious predecessors. Then came liberalisation in 1991, and with it the chairmanship of Tata Sons, the holding company of Tata Group.
Proud of the rich legacy he inherited, Ratan nurtured it and turned the image of the group into an aggressive and globally competitive, yet socially responsible corporate. He heads Tata Steel, Tata Motors, Tata Power, Tata Consultancy Services and Indian Hotels. Since Ratan assumed charge, the group revenue has grown six-fold to Rs. 81,000 crore.
He said in an interview (The Week, May 15, 2005): "One thing I have been trying to do in ten years (at the helm) is to change the organisation from a personality-oriented one to an institutionalised organisation. We want some degree of commonality across the group in terms of fundamentals and to have less of a mercurial individual style."
That remains his biggest contribution. "Today, the world does not afford you to luxury of being a slow mover. Nor are there any holy cows. We have to be aggressive, be far-sighted enough to look into the future and we also have to be pragmatic enough to say that if we really are not in a leadership position in a particular business, we should look at exiting that business," said Ratan.
With such a rigorous approach, the group and its companies have emerged as strong and focused business entities. While Tata Motors became a force to reckon with after his Rs.1,500-crore gamble, Indica, the TCS public issue catapulted Tatas into a formidable position in technology. TCS now aims to be the top five IT companies in the world. Tata Steel is the most profitable steel company despite the cyclical nature of business. The Rs.1-lakh car, expected to be out in 2008, is now poised to be the crown jewel of the group. The result of Ratan's quest for acquisitions across the world was Tetley and NatSteel buys, which heralded the arrival of a strong corporate India in the global arena.
Ratan, the man, however, is simple and shuns the glory of the high office he holds. His days begin with the workout on the treadmill followed by a light breakfast of fresh juice and sandwiches. He demonstrates loyalty to the company by driving a Tata Indica or a Marina. His black Mercedes Benz is strictly for official purposes.
Ratan spends most of his working hours meeting his colleagues and working out strategies for various group companies. His qualities, according to lawyer Dinesh Vyas who is his close associate, are clarity of thought and immense confidence in himself. "Many factors have contributed to make him the man of steel as we see him," he said. "Ratan is a very principled man with a high regard for ethics and law of the land. He cannot fight anyone who has complete disregard for these values. At times, such people have hurt him."
Ratan heads home to Bakhtawar, Colaba, around 7.30 pm every day. An evening out is a rarity, except for a company event. In his trusted group are Tata veterans MA Soonawala, RK Krishnakumar and JJ Irani. Weekends are at his self-designed beach house in Alibaug, spent with his pet dogs, Tito and Tango. He enjoys taking them for long walks at the US Club in Colaba. Incidentally, the names of all his dogs begin with 'T'.
Ratan's passion for gadgets and gizmos is nothing compared with his yen for aviation. Though he retired as executive chairman in 2003, he seldom finds time to be behind the controls of his Falcon 2000 jet. He wanted to fly a Tata Airline but political machinations denied him the dream.
Today, Ratan is the most recognisable face of corporate India. He knows being in the limelight is important for the group. "I was always playing down the group's attributes and achievements and I tried to change that. I think the group now has more visibility," he said.
His immediate family includes brother, Jimmy, and two sisters. Noel Tata, son of Simone Tata, is his stepbrother. When the Padma Bhushan awardee was asked about his successor, all he said was: "I don't think there was a view on who would be JRD's successor when he was alive. I certainly got a surprise when he decided to step down. I think close to the time I am leaving is when you should have clarity. I have reasonable clarity in my mind," he said.
Tata's yearly break comes close to his birthday, December 28. He disappears a day after Christmas and remains inaccessible for nearly eight days. But typical of the man, no birthday celebrations are allowed.