L E A D E R S H I P THE THREE COMMANDMENTS OF RATAN TATA, Global Icon

RATAN TATA,
Global Icon
by Dato Dr. NELLIE S.L. TAN-WONG Co Founder, Womens Institute of Management

The Three Commandments of

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L E A D E R S H I P THE THREE COMMANDMENTS OF RATAN TATA, Global Icon

he life and lifestyle of Ratan Tata leave me in awe. He is not only an icon of India, he is a world icon, who has placed India in the international spotlight. He has been described as the Chairman of Corporate India. And why not: Indians spice their curries with Tata condiments, drink Tata teas, wear clothes made from Tata fabrics, drive in Tata cars over bridges constructed with Tata steel, speak over Tata phones, communicate through Tata Internet networks, and stay in Tata hotels.

If I were asked to craft out The Three Commandments of Ratan Tata, they would be: Thou Shalt be Humble Always At least for the past twenty years, he has lived alone in a modest, book-filled seafront house outside Mumbai from which he drives himself to work every day in a small Tata car. His notable lesson in humility was when he turned down a job offer from IBM to join Tata Steel at Jamshedpur in 1962. He was attracted to the American lifestyle of opportunities and was tempted to accept the IBM offer, but the calls of family were greater, as his grandmother was in poor health and his grandfather urged him to return to India and join the family business. His entry into the family business, however, subjected him to a gruelling test of humility and endurance. He worked on the floor with other blue-collar employees, shovelling limestone and handling the blast furnaces! I wonder if the heir-apparents of many local tycoons and millionaires would go through the same test which Ratan Tata did! Thou Shalt Not Give Up if at first, Thou Doth Not Succeed In 1971, Ratan Tata was appointed Director-in-charge of NELCO (The National Radio & Electronics Co. Ltd.), which was then facing financial difficulties. He invested in high technology products instead of consumer electronics. By 1975, NELCO commanded 20% of the market share and recovered its losses. In that year, however, India declared a state of emergency, which created an economic recession followed by mounting union problems in 1977. NELCO did not survive all these challenges. In 1977, Ratan took charge of Empress Mills, which was also facing financial difficulties. He managed to turn around the company and even declared a dividend. Competitors with less labour-intensive operations however, posed a strong challenge to Empress Mills. More funds were needed to rejuvenate the company but some of the older Tata directors refused and in 1986, Empress Mills was closed down, much to Ratans disappointment. At a press interview with the Hindustan Times, he was reported to have lamented that the Empress needed just RS50 lakhs to turn it around! In 1981, Ratan became Chairman of Tata Industries, which he transformed into the Tata Groups think-tank to promote hi-tech into the business. In 1991, Ratan became Group Chairman, taking over from his grandfather, J.D.R. Tata. This was the beginning of the Rainbow Period for Ratan Tata, for with this influential position, he was able to implement his ideas and reshape the fortunes of the Tata Group, now enjoying the largest market capitalisation of any business house on the Indian Stock Market. Tata Motors went on to be listed on the New York Stock Exchange. On 31st January 2007, Tata Sons acquired the Corus Group, an Anglo-Dutch steel and aluminium producer, making Tata the fifth largest steel producing entity in the world, after paying the acquisition price of 6.75 billion dollars. Tata then acquired from Ford Motor Co., for 1 billion dollars, the prime marques of Britains motor industry, Land Rover and Jaguar. Tata is also involved with luxury hotels, jewellery and watchmaking. Little wonder that here in Malaysia our own big names in the local motor industry such as DRB-Hicom, the Naza Group, Sime Darby and Brookland Motors are scrambling to sign up with Tata Motors.

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L E A D E R S H I P THE THREE COMMANDMENTS OF RATAN TATA, Global Icon

Thou Shalt Honour Thy Promises In 1998 Ratan Tata introduced his brainchild, Tata Indica, into Tata Motors. It had long been his dream to produce a car costing about US$2,200, so that the man-in-the-street could own. Rival carmakers mocked this, claiming it was impossible to produce a car at such a low price. They said it would most probably be an enclosed motor cycle. However, they soon realised that Ratan Tata was indeed serious although he continued to keep his cards close to his chest. The cars design, features and how he would manage to slash costs all these were utmost secrets. On 10th January 2008, Ratan Tata realised his dream by launching at the New Dehli Auto Expo, three models of the Tata Nano car at a price of US$2,528. He said a promise is a promise, calling the car, the Peoples car. The success of Tata Nano will shift the growth dynamics of the entire Indian economy. It will create tremors for foreign small cars like Volkswagens Golf, Nissans Tsuru and Renaults Clio, which are currently the top sellers in Latin America and Europe. Price Waterhouse has predicted that between 2006-2011 half of the automobile sales will come from Brazil, Russia, India and China. The firm has also forecasted that the Tata Nano could encourage 1020% of Indias scooter and motorbike buyers to buy a car instead. If this happens, it could translate into an additional 1.8 million cars sold each year, which is almost equal to the current entire Indian passenger car market! Tata Motors is taking giant strides and creating history for the company and for India. First, the Landrover-Jaguar $1 Billion acquisition, then the worlds cheapest car, Tata Nano, and by next summer, it plans to produce the worlds first air-powered car, the Tata MiniCAT, which would have a range of around 300 km between refuels and each refuel would be about US$2!

The Tata Family Ratan Tata studied at Cornell and Harvard universities in the United States. He has a degree in Architecture and Structural Engineering. Of Parsee descent, he was born into the wealthy and famous Tata family in Mumbai. In the Gujarat region where the Parsees mostly settled, they cling tightly to their distinctive culture and an austere set of religious values. Up to today, they observe a prohibition against polluting the earth, air or water. Ratans great grandfather, Jamsetji Tata rejected the priesthood, pursued a career in business, and founded the family company in the 1850s. The Tatas have moved amongst Indias aristocracy since the time of Queen Victoria. The past 150 years have seen a growth in their wealth and power. Jamsetji Tata went on to establish textile and steel mills, and a shipping line. He also founded the countrys most famous hotel, Mumbais Taj Mahal. Ratan Tata could claim the highest celebrity status but instead, he leads a very private life and is almost never seen at social functions. He is not a proud person; in fact, he is sometimes described as shy. In his letters, Ratan comes across as a very polite and kindly man. He has never married and his best friends are believed to be his dogs. Since the age of seven, he was brought up by his grandmother, Lady Navajbai. He is reported to have said, There is a great sense of loneliness from time to time. Id be lying or hypocritical if I said otherwise, but I have my dogs and they are a part of my life. Ratan Tata plays down suggestions of great personal riches, pointing out that most of his businesses are ultimately owned by charitable trusts. Going by his strong character, his visionary business successes, his family pedigree, there is only one Ratan Tata in this world a rare global icon.

Mr Ratan Tata

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