A man for the '90s
Business World — January 1990

Strategic planning should be an ongoing exercise, not a one-off thing. Today, therefore, we are making another effort and taking a relook at the possibilities open to us in the light of our potentials.

In the sea of new faces churned up by the flowering of Indian capitalism in the eighties, his could well have been lost. It was, amidst the mega-industrialists, super whizkids and crony capitalists thrown up by the Rajiv era, he would have stuck out like a sore thumb. And in the rapidly thickening crowd of businessmen trying to thrust themselves into the limelight, he would have been elbowed back long ago.

But the chances are that in the nineties the limelight will seek out Ratan Naval Tata, Chairman of Telco, Tata Industries and a number of other Tata companies, and perhaps, the man who will ultimately step into patriarch J.R.D. Tata's shoes.

On the face of it, Ratan Tata doesn't appear to have much going for him in the form of a track record. A long association with Nelco, whose patchy performance over the years has had Tata observers shaking their heads in disappointment. A shorter, but even more fruitless association with Empress Mills - which ended up at the industrial morgue couple of years ago. True, he played midwife to clutch of seven hi-tech companies, but thus far the potential of these has overshadowed actual performance. And then, when he took over as chairman of the second largest company in the Tata stable - Telco - he presided over the most disastrous industrial relations slide in the group's recent history. Admits Tata honestly : "The company has perhaps taken the workers for granted for too long. As a result much distrust has sprung up."

But the negative side of Ratan Tata's ledger is more apparent than real. And for that, the key lies in his personality. Self-effacing, unassuming and essentially a shy, shy man, Ratan Tata positively squirms under the arc lights. Switch them off, and he comes through as a straightforward, honest and thinking individual. Just the kind of person you would entrust the destiny of India's largest business house (1988-89 gross sales: Rs. 8,413 crore) to.

At this stage, it must be clarified that Ratan Tata is only the apparent, in the house of Tata. As JRD himself made it clear some time back, while his nephew (i.e. Ratan) shared his own values, the chairmanship of Tata Sons, the apex organisation, was an elective one. Thus, after JRD, the board would not have a chairman thrust on it; it would choose its own head. That is why a track record matters, more particulars for a media-shy Ratan. What has been his real contribution to the house of Tatas as things stand today?

Rejuvenation of Tata Industries would probably figure at the top of the list. Tata Industries, which went moribund in 1969 after the abolition of the managing agency system, was turned into a vehicle for the promotion of new, hi-tech industries with Ratan Tata at the helm.

As author of the group's strategic plan in 1983, Ratan Tata has certainly established that he has vision. True, the plan has been kept in mind only by the companies actually under Ratan's charge, but it proved remarkably prescient as far as predicting the future was concerned. Among other things, it forecast joint sector projects as the way to grow - and that was long before the government began thinking along those lines. Meanwhile, a new strategic plan is in the making for the nineties.

He has built bridges to government, having realised that, in ultimate analysis, government and industry must work together. Hence his willingness to chair Air India (though he has since put in his papers) and work with informal government advisory groups (like the Planning Commission group on R and D, chaired by V. Krishnamurthy of Sail). But Ratan Tata has not used these bridges to curry short-term favour for himself or his companies. Unlike the Ambanis and Oswals, for whom changes in government bring untold uncertainty, the Tatas face no such internal tremors.

The Tata plan for the nineties could well be the blueprint to hold the Tata group together in the post-JRD era. Unlike JRD, who holds the group together by sheer weight of personality and respect built over 50 years of chairmanship, Ratan has no such advantage. He may well step into JRD's place when there are several other Tata titans with greater claims to empire. Sensibly, Ratan's focus is clear: to keep it "more structured in terms of a central core plan."

To be sure, even without all these amorphous achievements, Ratan Tata has formal and adequate clout within the group to make him the senior most director in the group after JRD. For, apart from being chairman of Tata Industries and the companies it promoted, he is also chairman of Nelco, and since late 1988, Telco too, which he took over after Sumant Moolgaokar relinquised charge shortly before his death. Tata is also vice-chairman of Tata Steel, Tata Chemicals and Tata Power.

For all that, Ratan began his career at the Tatas unpretentiously enough. After obtaining degrees in engineering and architecture in the US, he returned to India, proceeded to Jamshedpur, worked first on the shopfloor, and later as an engineer. His first real independent charge was with the National Radio and Electronics Co. Ltd. (i.e. Nelco).

Nelco was clearly a sick child in the Tata stable when Ratan Tata became director-in-charge in the mid-seventies. The company had not been able to hold its own in the very competitive market for radios, and seemed to lack any kind of strategic direction. Both S.K. (Bobby) Mukherjee, Nelco's current managing director, and Raju Bhinge, who had put in a good 12 years with the company before moving on to become one of the powerful "backroom boys" at Tata Industries, feel that Ratan Tata's main contribution at Nelco has been to give the company the sense of direction it sorely needed (see BW cover feature,11-24 April, 1988).

Rewards of patience
The company's industrial systems division was started under Tata's lead, and for some years now, it has needed nursing and protection. All through the seventies, turnover stagnated at around Rs. 60 lakh per year, but now, with the figure around Rs. 25 crores annually, Nelco seems set to reap the rewards of patience. In the future, industrial systems could provide a cushion against the sharp oscillations between profits and losses that Nelco's other divisions have seen in yester years.

A Rs. 6 crore order from Tata Steel (for its new bar and rod mill) has been executed successfully, with technology obtained from Westinghouse. On hand is a much larger new order of Rs. 120 crore, also from Tisco, for its hot strip mill, with a three-year delivery schedule. Technology for this is being sourced from General Electric of the US. Mukherjee is completely unapologetic about the "in-house" Tisco order. "Nelco fought tooth-and-ail against giants such as Bhel and finally won because the company's offer must have scored both in terms of technology as well as price," he says. Another Rs. 13 crore contract has been obtained from Hindustan Development Corporation, which makes railway track equipment and structurals, and Mukherjee is hopeful about competing in bids for the new private sector steel plants being put up by Essar and others. Nelco has, in the meanwhile, withdrawn from radios, and the entertainment electronics division has concentrated entirely on television sets. The company's great achievement in recent years has been to build up a respectable share in a fiercely competitive market, and this success has certainly come as a morale-booster. Profits, however, tend to remain wafer-thin, and since TVs constitute a "stand alone" activity for the company (unlike competitors like BPL or Videocon, who are opting for video manufacture), the vulnerability remains. Moreover, annual growth in the TV market, which was going along at a pretty 30percent to 40percent in the past few years, has now plateaued off.

Nelco's ups and downs, and its hesitant success, have sometimes been held against Ratan Tata, but those who have worked with him, both insiders at Nelco as well as well-informed outside observers, strongly dispute any such suggestion. In the first place, they say, Ratan Tata inherited an organisation which was in a shambles - and his role as a chairman was a non-executive one. He had to find suitable professionals, and virtually start from scratch.

A fresh infusion of equity funds two years ago has helped. Today the company is certainly out of the woods, has managed to wipe off all its accumulated losses, and annual turnover is nuzzling Rs. 100 crore.

Unfortunately, another Tata basket case which got landed in Ratan Tata's lap in 1977, Empress Mills, just could not be saved. Not for lack of trying, though. When Ratan Tata took charge of the Empress, the organised sector cotton textile industry was not far from being in the worst shape every, though possibly Datta Samant's indefinite strike dealt the final body blow. Competition from powerlooms had made a large number of companies unviable, including those like the Empress which had large labour contingents and had spent too little on modernisation. On Tata's insistence, some investment was made, but it was really a case of too little, too late. Bombay House, the Tata headquarters, was clearly unwilling to divert large funds from other group companies into an undertaking which would need to be nursed for a long time. And with the market for coarse and medium cotton cloth (which was all that the Empress produced) turning more and more adverse, the Empress went into an inevitable financial tailspin.

The Empress closure in 1986 perhaps brought home to the senior directors at Bombay house what had been clear to Ratan Tata for quite a while: that the group's lack of cohesiveness was turning into a major disability. Thus, while the Birlas bailed out Jay Shree Textiles through a merger with India Rayon and the Bangurs arrived at a similar arrangement between Hastings Jute Mills and Shree Digvijay Cement, very little of such "blue-sky thinking" could be done for the Empress. Perhaps, some lessons were learnt, and with ACC, the Tatas have reasserted control in 1988.

Despite the common impression that Tata shareholdings in group companies are at very low levels, this is not quite true except in the case of the Tata Electric. Companies and Tata Steel (and even in the case of the latter, group shareholding has been increased to 8percent after the recent convertible debenture issue). In most other companies, shareholding is at a pretty respectable level, ranging between 20percent-40percent. But notwithstanding this, and despite JRD's strong personality which upholds Tata "values", group companies have been unable to pull together because of a lack of clear strategic direction at the centre, to which all the powerful chiefs subscribe.

The Tata Plan evolved under Ratan Tata's guidance in 1983, made an attempt to remedy this. It didn't work, for many of the operating chief saw the Tata Plan as an encroachment on their independence. But today, at the end of the eighties, the changed business environment may prompt greater cooperation. At any rate, Ratan Tata is engaged in overseeing a fresh exercise to determine Tata strategy for the nineties, which may, however, concentrate more on the companies under his own charge.

In fact, the only part of the 1983 plan which was implemented with some degree of completeness was in the ventures that were promoted under the wing of Tata Industries, the "seven sisters": Tata Telecom, Tata Keltron, Hitech Drilling Services, Tata Honeywell, Tata Elxsi, Plantek, and Tata Finance. It is worth briefly looking at each of these companies.

Tata Telecom, which has under taken a Rs. 10 crore EPABX project at Gandhinagar, Gujarat, has a capacity to produce 50,000 lines per annum with technology from Oki of Japan. It broke even in the very first year of operations. In the nine-month period between July 1988 and March 1989, the company earned a Rs. 16 lakh profit, after all charges, on a sales turnover of Rs. 12.5 crore. In the current financial year, turnover is expected to be in the region of Rs. 20 crore, with a bottomline to match. Orders worth about Rs. 15 crore are in hand - i.e. nine months' production - which is comfortable enough for a consumer product where the lead period for delivery cannot be more than one or two months. The company intends to also apply for the manufacture of fax systems, paging systems, and perhaps main switching systems, under licence from C-DoT.

Tata Keltron, the second telecommunications company in the fold, is a joint venture between Tata Industries and the Kerala government. It is a Rs. 6 crore project with technical collaboration from Siemens for the manufacture of telephone instruments. The Keltron tieup was made at a time when licences were not being given to the private sector, and so the joint sector route was chosen. In retrospect, perhaps, it might have been better if Tata Telecom had got the licence to make telephone instruments as well so that a duplication of space, facilities and machines in two different projects might have been avoided. Tata Keltron depends on the Mahanagar Telephone Nigam and the department of telecommunications for orders. Consequently, margins have not been too good. While the company has made a Rs. 65 lakh cumulative loss in the first two years, the future is expected to be better.

HiTech Drilling Services has technical as well as financial collaboration with Schlumberger. Two oil-drilling rigs have been installed at Bombay High at a cost of Rs. 40 crores, with a 1:4 financial leverage, and the purchase of a third rig is being negotiated. In the first three years of operation, the company has made cash profits, and current prospects are such that margins should improve. Since payments for technical services (in the form of foreign personnel) constitute a large chunk of costs, the company is training its own personnel.

Tata Honeywell has a shareholding pattern similar to HiTech Drilling - 40percent with the Tatas, 40percent with the foreign collaborator and 20percent with the public. The Rs. 6 crore project, involving the manufacture of process control equipment at Pune, has recently gone on stream. The company also proposes to trade in Honeywell products in India. Tata Elxsi is still an unrealised potential. Elxsi was a US company in which the Tatas got involved at the venture capital stage, with the understanding that the south-east Asian market would be theirs. Recently, the company discontinued operations in the US and shifted based to Singapore Elxsi systems are super mini computers and Tata Elxsi, Singapore, currently has a $10 million turnover.

Elxsi systems should have adequate niche markets in the Far East and in India. An Indian venture may be established, perhaps with a Rs. 15 crore project cost, for the manufacture of parts which can be sourced competitively from this country.

Plantek, also in Singapore, is a joint venture between two Japanese companies, Sumitomo and Kuo Hako. Native Plants of the US, and the Tatas. In common with other biotechnology firms worldwide, it has promised a lot, but the results are yet to come in. As with Elxsi, Plantek could be the knowhow source for a separate Indian venture.

The companies promoted by Tata Industries are not likely to make super-profits, but then this was certainly not the primary objective. The idea was really to have a forward view, and establish a presence in areas which are likely to grow in the future and pay off in the long run. Notwithstanding the fact that ever collectively the turnover of the "seven sisters" is a small drop in the Tata ocean, one thing is undeniable. Tata Industries today is a rather different organisation from the moribund company that Ratan Tata took over 7 group of around 10 highly charged executives have managed to implement six projects in five years - which is no mean achievement. The share capital of the company has been increased from Rs. 50 lakh to Rs. 7.5 crore through the issue of shares to Tata group companies and the net worth stands at over Rs. 9 crore. The company's investment portfolio, if valued at market prices today, would be over Rs. 40 crore.

Nevertheless, there are some drawbacks in the company's present structure. As a catalytic investment company, the skeleton structure could be acceptable. But since Tata Industries is not an operating company, it lacks the ability to create systems in the new companies promoted by it, or perhaps cross-subsidise the long-gestation projects through its financial muscle. Again, manpower training perhaps has to be duplicated in all the new companies, and pre-operative expenses can be high. It has been an entirely different matter when Tisco, Indian Hotels, or Tata Chemicals have promoted new ventures.

The great advantage of being in charge of a large, established and operating company is obvious. This honour came to Ratan Tata only late last year with Telco, when Sumant Moolgaokar relinquished charge in Tata's favour shortly before his death. Telco continues to enjoy dominance in heavy commercial vehicles with about a 75percent market share. Moreover, the company has also demonstrated its technical versatility by launching various models of light commercial vehicles models of light commerical vehicles in quick succession all through 1987 and 1988, and would have, by this time, if labour troubles had not intervened at its Pune factory, also launched the Tata Estate car.

But problems remain. Telco's 1210 medium commercial vehicle (the most popular truck in India) is basically a dated model, even though the company has made countless improvements upon the Benz original. International standards call for much higher levels of quality and even domestic competition - from Ashok Leyland and the Mahindras - is shaping up.

The twin challenges that Ratan Tata faces at Telco are, therefore, clear: first, on the human relations front, to bridge the gap of suspicion between labour and management; and second, on the technical side, to aim for new targets of excellence.

As far technological improvements are concerned, Moolgaokar, before this passing away, had already indicated the way. Exciting plans are in hand to have a fresh tieup with Daimler Benz (the company's collaborators till the early seventies, and which still retains a 11percent shareholding). The idea is to make an international standard medium commercial vehicle entirely for export. Daimler's interest in this is obvious - manufacturing costs in Germany are too high for it to compete against the Japanese in overseas markets; so is Telco's interest - new, rigorous technical standards will have to be set and internalised.

Pact with Benz
After long and detailed confabulations abroad, an understanding has been reached. The project involves the manufacture of an entirely new vehicle, which has not been launched even in Germany and parts of whose design are still in the conceptual stage. The vehicle is expected to be ready only in 1991. The other international source that the Germans want to develop is their own subsidiary in Brazil.

Capital investment of about Rs. 60-100 crore will be made at Jamshedpur - and it will be an unequalled opportunity for Telco to modernise and upgrade its facilities at this location. Moreover, the company will be able to adapt component parts of the new vehicle (whether engine, transmission or gear box) to its 1210 vehicle after payment of a royalty to Daimler. The 1210 would then, by the mid-nineties, be comparable to any world class vehicle. And finally, Telco will be able to achieve higher exports, upwards of 8,000 numbers per year against 3,000 at present.

As far as the labour situation in Pune is concerned, Ratan Tata has clearly inherited an unsatisfactory legacy. While Sumant Moolgaokar never neglected human relations - in fact, he was an exceptional builder of people - his real passion was for technology. In his latter years, with failing health, Moolgaokar left a great deal to other people and concentrated on his chief interest.

A company as large as Telco (with over 37,000 people in Pune and Jamshedpur) needs as visible leader - and unfortunately, Moolgaokar's advanced years made this impossible. With the entry of Ratan Tata, however, there is expected to be a distinct change for the company in the months to come.

The problem about the two rival trade unions persists. While Rajan Nair, who leads the Telco Kamgar Sanghatana, withdrew his strike in November, his influence is still powerful and the other trade union is perceived as a creation of the management. This again is a flowover from the past. But Tata is quite categorical: pitting unions against each other is a game he will not play.

In his working life so far, Ratan Tata has always had a plateful of problems, whether at the Empress, Nelco or more recently at Telco. But even if he hasn't always been successful, the point to underscore is that he hasn't shied away from tough assignments. The nineties could bring in more of the same as industry - including the Tatas - grapples with the problems of cut-throat internal competition, the export challenge and a tougher operating environment.

As Indian capitalism matures in the nineties, the crony capitalists and charlatan industrialists will have to yield to the more value-driven clan of businessmen. Men who offer value to shareholders, the employees, the economy and the society at large.

By that yardstick, Ratan Tata is a man for the nineties.
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The Name Isn't All
In any other business group, the surname alone would have guaranteed heir-apparent status to Ratan Tata. But the Tatas have always prided themselves in being different. First, the ownership of their companies is chiefly held through public charitable trusts established by the founder's sons: and, second, the group proudly claims that professionalism has always had overriding importance vis-a-vis formal control via shareholding.

To some degree, the second claim is borne out. The late Suman Moolgaokar created Telco, and was its chairman for many long years. Similarly, Darbari Seth created Tata Chemicals and he is its CEO, as is the case with Ajit Kerkar, who transformed Indian Hotels. And Russi Mody's contribution in making Tisco what it is today needs no reiteration. All these people have been rewarded by group chief J.R.D. Tata with chairmanships in each of their companies.

Fiefdoms
The obverse side of the coin is clear: to a degree, it has meant the creation of "fiefdoms." And, in an era when the managing agency system has long been abolished, the chairmanship of Tata Sons (the apex Tata holding company) has tended to become, with JRD, more of a symbolic role. Not surprisingly, the Tata group has been likened by some within it to the Commonwealth, where the British sovereign is a symbolic head.

But the parallel does not quite hold, mainly because Tata shareholdings, contrary to popular myth, in group companies are still quite substantial. And where they were not (e.g. Tisco, ACC), stakes have been upped. Thus, the generally propagated idea that the Tatas manage their companies mostly on the merit of their track record and not by virtue of shareholding power, is partly untrue (see table).

It is true, however, that JRD did allow operating chiefs a unique kind of freedom - and thus gave the opportunity to the Darbari Seths. Ajit Kerkars, Russi Modys or A.H. Tobaccowalas (at Voltas) to grow. However, all of them are operating chiefs and not owner managers. Therefore, while the Birlas or the Mafatlals or the Shrirams have carved up their groups between different (family) constituents, the Tata group continues to survive as a confederation, and "group thinking", despite pulls and pressures, is still a reality.

A leader
Group cohesion could be important in the nineties. Increasingly, large business groups are expected to provide the impetus for economic growth, and the suspicions which engendered the MRTP Act are slowly being relegated to the past. Thus, the next chief of the Tatas much not merely be a repository of values as JRD is today (ethics, integrity, providing value to the customer, etc.), but must also consciously attempt a synergisation of the group's efforts. This need not mean "central control", vested in a single person. It simply means greater internal cooperation, with the leader keeping in mind a picture for the group as a whole while acting as a catalyst within a band of very senior and responsible people, and blending Tata interests with those of the community at large.

JRD himself has gone on record saying that after him his colleagues on the board of Tata Sons will elect their own chairman. A few years ago Bombay House hearsay would have it that N. A. Palkhivala, Russi Mody, Darbari Seth and Ratan Tata could all be possible successors to JRD.

Palkhivala is today no longer in the running, but Russy Mody, as chairman of the group's largest company, Tisco, or Darbari Seth, as a senior person and chairman of the singularly successful Tata Chemicals, could still be said to have a claim. But insiders reckon that, ultimately, it will be Ratan Tata. Integrity and vision he has had in plenty always. But now he has the track record as well - the creation of a new-look Nelco and the setting up of the "seven hi-tech sisters" under the Tata Industries umbrella. The late Moolgaokar's nomination of Ratan Tata for the chairmanship of Telco may, therefore, be a prelude to a more central role for him in the Tata scheme of things.

A Plan for the Future
Ratan Tata is not the type to say 'I told you so.' But the Tata strategic plan document drawn up in 1983 under his supervision certainly entitles him to make the claim. Among other things, the document foresaw that the capital market would expand, and that raising funds for new projects would pose few difficulties; it took into account the possibility of intensifying competition which would call for special efforts on the part of the low-tech areas of Tata businesses to survive; it recommended the joint sector route for growth long before it became the rage; and it talked of mergers and acquisitions at a time when Manu Chhabria of Dubai was still an unknown figure.

Four clear strategic directions for the future emerged from the 1983 plan:

• That the Tatas must strive for technology-driven leadership.
• That there must be a focus on selected product and market segments.
• That joint sector projects must be pursued for growth in the big league.
• That synergies must be tapped within the group.

But the plan has remained just a paper exercise. In the last six years, there has been little conscious effort to translate it into reality, except in the projects promoted by Tata Industries, of which Ratan is chairman. Through Tata Industries, the group has managed to establish a presence in sunrise areas and grasped business opportunities which the group may otherwise have missed out on.

Joint sector route
Nevertheless, some of the major Tata companies have independently pursued strategies not different from the course recommended in the 1983 plan. The joint sector route has been followed in Titan Watches, Tata Fertilisers, Ipitata, the Pepsi venture with Punjab Agro Industries and Voltas, and the proposed Karnal oil refinery under the aegis of Tata Chemicals. Mergers and acquisitions have also taken place: Tisco has merged Indian Tube in it and has taken over a number of small metal or engineering units; Tata Fertilisers has dissolved itself into Tata Chemicals; Indian Hotels bought the President hotel in Bombay and promoted a number of companies in India and abroad; Tata Tea is in the process of acquiring Consolidated Coffee; and when Pallonji Mistry finally lost interest in ACC, the Tatas, through Darbari Seth, scotched Nusli Wadia's bid and reasserted control in a company which had originally been theirs. In the cases where action was not taken in time (for example, Ratan Tata had recommended an exit from cotton textiles), events precipitated action and sometimes inglorious closure, as in the Empress Mills case.

In sum, patchy implementation notwithstanding, the Tata plan has proved its relevance. And Ratan Tata is today quite clear that strategic planning cannot be a one-off exercise. Hence the impetus for a new plan incorporating the Tata vision for the nineties. Raju Bhinge (38), a former divisional manager at Nelco, is the man in charge of the planning exercise for the nineties.

This time around, the exercise is being done differently. In the 1983 plan, eight business area committees had been set up. For the nineties plan, Bhinge and his team will concentrate on Tata Industries, to see, as Tata puts it, "how far the company has covered its chosen road, and how to profitably continue pursuing the goal of hi-tech." Management pundit S. K. Bhattacharyya will be involved as an outside consultant.

Minimising tension
As far as the Tatas as a whole are concerned, there will be a single apex committee which will attempt an overview. If any operating company then requires a more systematic study or follow-through, this service will be offered. The approach is designed to minimise any kind of intra-group tension: the last time, some operating companies were a little reluctant to participate in the exercise since (they thought), it might encroach on their independence.

Bhinge is cautious about offering any detailed description of the exercise being undertaken for Tata Industries simply because it is still too early. However, he has some observations to make. "Apart from business areas in which we have already made an entry (like biotechnology, advanced electronics and telecom), we are thinking about advanced materials and alternate energy sources," he says. "All this is fine, but we also need to address some fundamental questions. We had earlier defined our mission as being into hi-tech, but we should ask ourselves, how far are we really in hi-tech? Do we need to modify our mission, or perhaps expand it?"
Adds Bhinge, "There are areas which the Tatas as a group are missing out on. In the immediate past, such an example may have been petrochemicals, where the group has probably missed the bus. But there are some opportunities which are still open - for example, in drugs and pharmaceuticals, and in plastics. We need to look at these opportunities closely. And we also need to decide whether Tata Industries itself wants to undertake such projects, or merely act as a catalyst, and pass on ideas to other group companies."

Clearly, Bhinge has the most interesting corporate planning assignment today in India.

"We'll have a crack at the New Era"
On this busy days, 52 year old Ratan Tata, Chairman of Tata Industries and Telco, sometimes has to attend as many as three board meetings, one annual general meeting, six important conferences with operating managers, and perhaps, round it off with a business trip that could take him to Jamshedpur, Pune or Delhi, or even as far away as Singapore, Australia, Japan, Los Angeles, New York or Europe. Talking to Tata is, therefore, both pleasant and problematic: pleasant because he seldom hedges questions, displays great clarity of vision, and infectiously communicates his strong and positive beliefs; problematic because one seldom gets an uninterrupted hour to talk to him. BusinessWorld pieced together his comments on a number of issues over a number of short sessions. Excerpts :

On strategic planning in the Tata group
After our last exercise in the early eighties, it was intended that policy groups for each of the business areas identified for growth would meet on an ongoing basis. This has not happened. With several Tata Industries' projects getting the go ahead, the people doing the nitty-gritties of the planning exercise got involved as operating managers and strategic planning took a back seat.

Nevertheless, there are a lot of areas which we may be missing out on. Strategic planning should be an ongoing exercise, not a one-off thing. Today, therefore, we are making another effort and taking a relook at the possibilities open to us in the light of our potentials.

On the future of Tata Industries, which has promoted several new projects.
Thinking about this would be part of the strategic planning exercise. But a general comment would be that we must try and make Tata Industries a more attractive company for its shareholders and provide better investment returns.

We have to consider whether we can try out the acquisition mode, i.e. get companies which have positive cash flow and profits. But we would definitely continue to pursue the goal of hi-tech.

On his interactions with government.
One task which I have liked a great deal is working for the science and technology ministry. I was part of a technology mission to the US, where the effort was to set up a venture capital company in that country which could buy into hi-tech companies. The model would roughly be what the Tatas did with Elxsi (a Singapore-based Tata outfit; see main story). I am in the process of preparing some notes about this for the government.

On the Tatas seven or 10 years hence.
I do not envisage any change in the character of the group. We shall continue as a loose confederation with strong operating chiefs in charge of and responsible for their comapnies. And the value system is bound to survive-there are enough people, who may not be immediately visible to the outside world, but who all subscribe to and uphold these fundamental values.

I am confident that the Tata culture will remain very strong in the hands of these people - low visibility, non-flamboyance and an effort to expand business but retain ideals at the same time. If it is acceptable to the government, we would not only have a crack at a new era, but also become more structured in terms of a central core plan.

On the future of Telco, the first major Tata company he heads
The late Sumant Moolgaokar has bequeathed us a grand legacy. Telco did not have to modernise, but under Moolgaokar's inspiration, the company continually upgraded, sought new technologies and international standards. It is now for us to follow through this path. Organisationally, the company is functional enough; but so far, it has been a single product, virtually a single model company. Today, the product profile has changed - now there are medium commercial vehicles, light commercial vehicles, and cars. We may have to adapt ourselves, accordingly, to more of a multi-divisional structure. Also, our Pune and Jamshedpur factories may each concentrate on their respective strengths - Pune on light commercial vehicles and cars, and Jamshedpur on medium and heavy commercial vehicles.

On Telco's labour problems
The company has, perhaps, taken its workers for granted for far too long. As a result, much distrust has sprung up. Trust will have to be earned again by both sides. This will be my effort for the future.