Mumbai: Bombay House officials liken the group’s foray into every telecom segment as a flotilla of ships, moving in concert and based on a plan. Switch the navy whites for the cricketing sort and the metaphor still works. Bombay House (or rather the Group Executive Office headed by Ratan Tata) is the captain who will assign the roles which the players will carry out. The selectors of the team are group companies like Tata Power, Tata Steel and Tata Industries, which will invest the funds to make the infocom plays work.

Extending the analogy, the players will have different roles. The Sachinesque-rock around which the team will play is a new, yet nameless firm with an initial equity of Rs.700 crore to be formed by three Tata companies to house the Groups’ customer-interfacing communications businesses like basic telephony and ISP services.

Tata Power’s Broadband Division with more than 200 kilometres of lit optic fibre in and around Mumbai is the outfielder. In the gullies Tata Internet with its data and ISP services. Tata Teleservices will cover a part of the field with basic services in Andhra Pradesh, while the Batata-BPL combine is ready to catch any cellular calls in the air. On the sidelines stand Tata Consultancy Services, a 12^th man like Bradman’s Wally Hammond, with 3,000 telecom engineers and a Rs.600 crore telecom business, ready to come to the aid of each player, be it for building an integrating networks or common billing systems.

A formidable team, but is it good enough to redefine this smokestacks and engineering group by its infocom and other service businesses in the 21^st century, just as it was by textiles in the 19^th and steel in the 20^th ? Is the captain-in this case, the GEO headed by Ratan Tata good enough to win the match?

The captain’s or GEO's telecom strategy is complex because Team Tata has no idea whether the pitch will turn on the fourth day i.e. what technology will suceed in India in the future, or whether the umpires will be impartial in terms of the regulatory environment. Thus, unlike other groups like Reliance, which has placed its bets on wire-less-in-local-loop (WLL) technology, or Hutchison, which has placed its bets on the cellular field. Team Tata is keeping its options intact by maintaining its presence in all the different telecom domains. This will help them capture value at different points of, say, a phone call, depending on the prevalent tariff and regulatory regime. The basic idea? Once you have hold on a customer, try and capture all the value within the group.

Even more interesting for corporate observers is whether the Tatas can play as a team at all. Historically, the Tatas have been a loose federated structure with the centre not dictating to the group companies. "The Tatas founded a company, appointed a CEO and the company did its own thing-its off-spring may fight with one another, but the Tata patriarch felt that they were adults and should make their own decisions," says a Tata watcher. In other words, the Tata companies were procreating randomly. In this scenario, collaborations within the group were more emotive, based on individual contacts, rather than rational or institutionalised.

The captain’s table
That may now be changing. The infocom initiative is the most visible sign, the first time that the group is invading a business on the basis of a centrally crafted strategy with specific roles being assigned to group companies. But this new spirit of co-operation, fostered through forums like Group Management Meets, is being extended to buying each other’s goods, from telephones to tea, negotiating as one entity for outside goods and services and following Bombay House’s initiatives on human resources and work levels.

For better or worse, this new structure has brought about other, less visible changes. The board of Tata Sons, for instance, is no longer filled with statesmen and ambassadors like Nani Palkhivala, but with hard-nosed professionals like R.Gopalakrishnan and Ishaat Hussain, who think nothing of making marketing calls to bag deals for TCS.

Even the average age of a Tata Son’s board member has fallen to 66 from 69 years in the last five years. Moreover, under a GEO structure, CEOs can no longer expect lifelong employment in a company and must be ready to move around the group. At least ten CEOs of the group have been changed in the last four years, including companies like Tata Steel, Indian Hotels and Voltas.

If successful, the infocom business will also remake the Tata group’s image from a metals and chimneys group making steel to a services company associated mainly with wires and routers. R.Gopalakrishnan, executive director of Tata Sons and a GEO member, predicts that more than 75 percent of the group’s revenues will come from branded goods and services by 2010. Currently, more than 40 per cent of the group’s sales of Rs.35,000 crore come from services whereas commodities counted for more than 80 per cent a decade ago.