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SPARK OF THE CORPORATE

 

"The Tata’s are a reconstructed family who adopt and cobble together people to make a family. That way they do promote talent rather than blood relations. Ratan was clearly talented, but he resents the implication."

Ratan Tata is a magnificent Business Titan of India with wide business experience across a variety of industries, who took the reins as Chairperson of Tata Industries Ltd way back in 1991. Ratan Tata (74yrs) has been at helm of Tata Group for two decades. The Tata group of companies include Tata steel, Tata Motors, Tata Power, Tata Consultancy Services, Tata Tea, Tata Chemicals, The Indian Hotels Company and Tata Teleservices.

When Ratan Tata inherited the Tata Group, it was un- coordinated and un-structured. Ratan Tata being a great visionary and powerhouse of knowledge gave a touch of innovation and strong strategy to restructure and transform the Group. He was instrumental in shifting the business from Indian centric giant to Global giant. Under the great leadership of Ratan Tata, the Tata Group produced a stream of products that caters the rising needs of people through out the world, around 80 countries. During his tenure, the Tata Group’s revenues have grown over ten-fold and accounted to $67.4 billion.

He is a man of explicit simplicity and a great philanthropist, a large number of the shares (around 65.8%) of Tata Sons, the holding company of the Tata Group, are held by charitable trust. Recently he made into headlines of news as “The only Indian reputable business leaders”, with net worth of $970mn. Reputation Institute created a list of 54 of the world's most visible leaders and public personalities in politics, business, culture, and sports. It was under his stewardship that Tata Consultancy Services went public and Tata Motors was listed in the New York Stock Exchange.

Tata Group is prestigious business enterprise of 21st century, which won the trust of millions of people, manufacturing salt to software. Ratan Tata is unsurpassed business Patron of India, he crated a new era of entrepreneurship encompassed by intelligence, virtue and perseverance. He strongly believed that business should not achieve short-term goals at the cost of long-term goals. As a business leader, his primary focus was to give back to the society and improve the quality of life of people whom he serves. The advent of true Indian car Tata Indica in 1998 and the cheapest, eco-friendly and fuel efficient Tata Nano in 2008; were sheer examples of his concern about Indian people. He is the most legendary Indian who ventured and made huge name in global business arena. ,  with 357,000 employees worldwide, the Tata Group's 98 operating companies derive more than 65% of their revenues from overseas.  He stood symbolic for all emerging entrepreneurs.

For generations of Indians, and even outside the country, if there was one word, which spelt “trust” and “integrity”, it was the word Tata. One of the well-known legendary tales in the Indian industry about Tata’s, was that “Tata’s don’t bribe” and “Tata’s don’t indulge in politics”. It was an intrinsic principle of the House of Tata’s, and for all the employees of this huge group, it was a matter of honor that they believed and practiced this principle.

Career Outlook
In 1962 after graduating in Cornell University, Ratan Tata entered the family business turning down an offer from IBM. His first project was to work at the Tata steel plant at Jamshedpur. He worked there humbly with the blue-collared floor employees shoveling limestone and handling the blast furnaces, depicting the Tata’s style. Here he got hang of the working processes in detail from operations to management. In 1971, he was sent to National Electronics and Radio Company (NELCO) as director-in -charge, which was starving financially. Ratan Tata soon realized that NELCO had prudent, hi- tech systems and has a jubilant future. Therefore, he requested JRD Tata to invest further on NELCO and succeeded in negotiations. Ratan Tata helped to build a better consumer electronics division but the economic recession and union strikes prevented his vision from taking hold. Tata was later assigned, to hold the responsibility of Empress Mills in 1977, a struggling textile mill within the Tata Group. Ratan Tata has a vision of renewing the mill, but majority of Tata group were against the decision, which later resulted in liquidation and shutdown of the mill in 1986. The first two projects of Ratan Tata were failures, which haunt him even today. Those were the more dark days of Ratan Tata, because Empress Mill was the first company that was started by the late Tata’s and he could not save it.

Ratan has an open mindset to take risks to escalate the business growth. Later in 1991, he became the Chairperson of Tata Industries Ltd, replacing the legendary JRD Tata. Later JRD Tata passed away in 1993, approving the visions of Ratan Tata. He undertook many reforms to restructure and consolidate Tata Group of companies under the Tata Son’s banner. At this juncture, India was undergoing second round of economic liberalization and Tata’s holding company gradually increased its shareholdings in group companies like TISCO (Tata steel),TELCO (Tata Motors), Tata Power, Tata Consultancy Services, Tata Tea, Tata Chemicals, The Indian Hotels Company and Tata Teleservices. It was under his stewardship that Tata Consultancy Services went public and Tata Motors was listed in the New York Stock Exchange.

Ratan Tata followed aggressive strategies in business .In 1998 Tata Motors came up with a truly Indian car, Tata Indica, which was a brainchild of Ratan Tata. Tata Nano was an innovation designed by Ratan Tata, to bring affordable cars to the Indian masses across rural and small-town India, released into market in late 2008 (world’s cheapest car, fuel efficient, eco-friendly). Tata's food division acquired tea firm Tetley for £270mn in 2000. The historic and biggest Indian acquisition was, Tata Group acquiring Anglo-Dutch steel maker Corus Group at $13 billion by Tata Steel ,in April 2007.This investment placed Tata steel at sixth place in the world in the steel industry, progressing the company’s globalization initiatives. In yet another significant step towards becoming a global player, Tata Motors acquired the businesses of two iconic British brands, Jaguar and Land Rover, from Ford Motors for a net consideration of $2.3 billion in June 2008, with the aim to spread its footprint globally and at the same time enter the high-end premier segment automobile market.

After the acquisition of Tetley, Corus, and Jaguar Land Rover and Corus, which have turned Tata Group from Indian Company to a global business, with 65% revenues coming from overseas?

“Ratan Tata with world’s cheapest car Tata Nano”

Ratan Naval Tata, who made the Tata Group a global conglomerate and made the world's cheapest car, is very keen on retiring by the end of December 2012, when he reaches 75. Even though Ratan Tata has said he will look outside India for his successor, speculation is building that his half-brother, 53-year-old Noel Tata, may succeed him. A Tata Sons statement said its nine-member board has formed a selection committee comprising five members, including an external member, "to decide on a suitable successor". The committee would look at candidates both within the organization and outside. It is expected that the final selection would be made in "adequate time to effect a smooth transition and change of leadership" before Tata hangs up his responsibilities.

More about Ratan Tata
1Born: 28 November 1937 (age 73) Mumbai, Bombay Presidency, British India
1Residence: Colaba, Mumbai, India
1Nationality: Indian
1Ethnicity: Parsi
1Religion: Buddhism
1Alma mater: B.Sc Architecture, Cornell University Advanced Management,
 Harvard University
1Occupation: Chairman of Tata Group
1Marital Status: Unmarried

One of the most popular industrialists in India, Ratan Tata, is born on December 28, 1937, in Mumbai, in an old Parsi family. He was the first child of Soonoo and Naval Harmusji Tata.His childhood was unhappy, because his parents parted in mid 1940’s, when he was seven years old and his brother was five. His grandmother, Lady Navajbai, brought him up. He spent most of his childhood in Mumbai. Ratan Tata did his schooling from Cathedral and John Cannon School in Mumbai. In spite of all the odds, Ratan Tata grew up in luxurious atmosphere, at Tata Palace, a white Baroque revival-style building in the centre of Mumbai, attended by a crew of 50 servants. He drove to school in a Rolls-Royce.

After schooling, he got his Architectural and Engineering Degree from Cornell University, in 1962.Later in 1975; he did his Advanced Management Program in Harvard Business School, USA. He loved to lead a simple life, earning his own money. He admired the "easy, warm, casual lifestyle" of the west coast. However, the family's dearth of talent saw him summoned back to India. The young Ratan Tata rose swiftly, although he complained that his name was more of a burden than a boon.

 Ratan Tata with his DogsRatan Tata flying Air Jets
 

Ratan Tata is not married and prefers to spend weekends in solitude in his beachfront house in south Mumbai designed by himself; watching CDs, reading books and his dogs for company. He is accustomed to travel alone even on long business trips, eschewing the retinues of aides who typically coddle corporate chieftains. Ratan Tata is a daring and dashing personality, has a passion in driving fast cars, flying jets, and at weekends racing his speedboat across Mumbai's harbour. He is an avid aviator; he often flies his own Falcon 2000 business jet around India. He caused a sensation at the Aero India February, 2007 air show by co-piloting Lockheed F-16 and Boeing F-18 fighter jets.

The words used most often to describe Ratan Tata are shy and loner. The 74-year-old chairman of the Tata Group shuns the media spotlight. An unpredictable fact, the Indian business baron drives himself to work in an unremarkable Tata sedan. He neither drinks nor smokes. Ratan Tata appears moved by fairness and not money. He is a great philanthropist. He owns less than 1% of the Tata group, a personal fortune of £300m. Over two thirds of Tata Group is owned by charitable trusts that finance good causes. One of the instances that depict his humanity, kindness and concern for people is, during Mumbai blasts at Taj Hotel, he talked to 80 families of all the employees and helped them in all possible ways like compensation, education, healthcare etc.

Awards and Honors

Ratan Tata served people across the globe with various products from salt- to - software, from tea- to -world’s cheapest car, steel- to -premier cars, Telecom services –to- chemicals etc. In recognition to his work, he received many honors. A few of them are as follows:

1The Government of India awarded the Padma Bhushan to Ratan Tata, in January 2000.
1The Government of India honored RatanTata, with its second highest civilian award,
 the Padma Vibhushan, in 2008.
1He was conferred with NDTV Automotive Man of the Year 2008 award.
1He received NASSCOM Global Leadership Award in the year 2008.
1He was honored with Carnegie Medal of Philanthropy on behalf of the Tata family in
 the year2007.
1He was awarded 26th Robert S. Hatfield Fellow in Economic Education, by
 Cornell University in the year 2006.
1He got the honorary citizenship, Government of Singapore on 29 August 2008;
 he was the first Indian to receive this honor.
1He received an honorary doctorate from the London School of Economics in the year 2007.
1He was among the 25 most powerful people in business named by Fortune magazine,
 in the year 2007.
1He was listed as one amongst the World's 100 most influential people Time magazine,
 in the year 2008.
Affiliations and Memberships

Ratan Tata is recognized business tycoon and bears various affiliations and memberships. Here are few among them:

His foreign affiliations include:

1Memberships of the international advisory boards of J.P. Morgan Chase, Booz-Allen
 and Hamilton Inc. and the American International Group.
1He serves as Member of International Advisory Board of Rolls Royce Holdings
 plc (Rolls Royce Group plc).
1He serves as a Member of International Advisory Committee of Mitsubishi Corporation,
 RAND's Center for Asia Pacific Policy and the Programme Board of the Bill &
 Melinda Gates Foundations' India AIDS Initiative.
1He serves as a Member of the board of Governors of the East-West Center.
1He was appointed to serve on the International Investment Council set up by the
 President of the Republic of South Africa.
1He has been appointed, a Member of the Asia Pacific advisory committee to the board
 of Directors of the New York Stock Exchange.
1He serves as a Member of Advisory Board of BMB Group. He serves as a Member
 of International Advisory Committee of NYSE Euro next, Inc.
 (alternate name New York Stock Exchange Inc).
  
His memberships in India include:
1He is the Chairman of the Investment Commission set up by the Government of India.
1He served as a Director and member of the central board of the Reserve
 Bank of India (RBI) as well as of the Prime Minister's Council on Trade and Industry.

Career Outlook
There are many facets to Ratan Tata’s global game plan. "Tata identified the theme of going global very early, but his initial judgment was that the group was not yet ready to move on to this agenda”. To begin with, Tata focused on competitiveness. We have to earn the right to survive, he would say. Only when he judged that the group had moved to this position, he decided to stand up in 2003, to spell out the international agenda”. His skill as a leader in making this theme resonate all over the group; the aggression with which he has won some of these cross-border deals; and his unshakable resolve never to compromise on the ethics and values that the group has cherished for over 100 years now. “Tata has shown that there is no other way he will do business other than do it ethically,"

Tata's game plan, according to his managers, was simple - rationalize the group's business portfolio; deliver a return on investment that exceeded the cost of capital; have a symbolically and emotionally unified brand; and grab new opportunities. Surely, after taking over, Tata's first job was to see that many of the group stalwarts, who were well past their retirement age, hung up their boots. He brought in new people to strengthen the parent company Tata Sons Ltd.

The earliest evidence of Tata’s thought leadership could be found in a document unofficially called, the Tata Plan that he authored back in 1983. Under the leadership of JRD Tata, the group got Ratan Tata (then Tata Industries’ Chairman) to draw up a blueprint for the future. In it, Tata recommended that the group `seek substantial growth in international operations.’ He also suggested restructuring the group to address the global opportunity better.

For the past six years, this has been Tata's way of reaching out to his people, telling them where the group is headed, what needs to be done and how they can do it. This year's theme was the global story. The bottom line being be bold; think big; lead, never follow. He is a deep thinker, strategic and long term and is always two-three moves ahead.

Managers who have worked with Tata closely say that he has identified many such themes internationalization was one. The push to hire young mangers at significant, decision-making levels across the group is another. The entire focus on the bottom of the pyramid, be it the one-lakh car, budget hotels or low-end watches, is his idea. So is the focus on research and development. "No doubt, he has been a big influence on the group in the last three-four years.Tata Group finally succeeded in global leadership, with 65% of its revenues from overseas, with none competing around.

Motivational Quotes by Ratan Tata
“At Tata’s, we believe that if we are not among the top three in an industry, we should look seriously at what it would take to become one of the top three players or think about exiting the industry”.

“We are responsible for the fortunes of the company but this is a bone-dry situation in terms of access to credit. Nobody can operate on that basis unless you have large cash balances, which we don’t. My concern is that the government doesn’t appear to care about manufacturing”

“Tata Group’s greatest contribution to the growth of the Indian economy and Indian industry probably happened in the pre-independence era. The Group’s investments in industries such as steel, textiles, power and hotels were certainly driven by an entrepreneurial spirit, but they were driven even more, I think, by a desire to make India self-sufficient and independent of its colonial masters then..”.

“I think the environment has become more competitive. That has made Indian industry more concerned with a) its customers, b) the quality of its products, and c) its brand image in the marketplace”

“We are probably not doing enough to build the Tata brand globally, but we are one of the most recognizable corporate names coming out of India. Apart from size, market capitalization and the rest, we are seen as a poster boy for ethical business, trustworthy and fair. That’s a model western companies feel comfortable with”

“The strong live and the weak die and out of it emerges a much leaner industry, which tends to survive”.

“I have never believed protectionism of that kind will lead us anywhere. I think you can have certain specific rules for engaging with India. For example, not allowing mineral resources to be taken out of the country. However, there is not a shred of doubt in my mind that when you open an economy you should do it in totality. Foreign investment adds a sense of competition; we should see this as a wake-up call to modernize and upgrade. Companies that do not will undoubtedly die”.

“One hundred years from now, I expect the Tata’s to be much bigger than it is now. More importantly, I hope the Group is regarded as being the best in India, best in the manner in which we operate, best in the products we deliver and best in our value systems and ethics. I hope that a hundred years from now we will spread our wings far beyond India”.

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