Okay Tata, buy buy
Set on taking home the keys for iconic British brands, Jaguar and Land Rover, the patriotic business tycoon's international buying spree is headed for an exciting finish, write Arun Kumar and Gaurav Choudhury.india Updated: Dec 29, 2007 01:30 IST
Ratan Tata, chairman of the Tata Group, drives a Honda. Even so, a marque like Jaguar suits him just fine. His hot pursuit of two signature British brands, Jaguar and Land Rover is turning into a nail-biting finale of an aggressive buying spree that included Tetley, Daewoo's commercial vehicle arm and the Ritz-Carlton in Boston. In many ways, Ratan Tata stands for the business of making the impossible possible.
The 70-year-old's business skills are a blend of astute entrepreneurial skills, ability to take swift, tough decisions, and foresight. He is probably one of the first Indian corporate captains who did not hesitate to look beyond the physical geography of India's borders.
Tata thinks global, but at the core of his heart is a proud Indian with a fire in the belly to position India as an equal in the global comity of nations.
Impossible is nothing
Be it acquisition, venturing into risky vistas, getting out of a particular line of business, or fighting corruption, Tatas have come out with flying colours.
The man responsible for manufacturing India's first completely indigenous small car — Indica — is now set to produce the world's cheapest car — pegged at Rs 1 lakh or nearly $2,500 — despite doubts expressed by several of his peers.
He is also the frontrunner in the race to acquire the iconic Jaguar and Land Rover. The outcome of this acquisition bid is yet to be seen. At a time when many global auto majors are facing rough weather in developed markets and looking towards emerging economies such as India, Tata is looking at one of the most saturated markets — the United Kingdom.
The group is not only looking at acquisition for the sake of corporate expansionism, but on pure economic sense. A case in point is when he decided to divest Tata Tea's 30 per cent holding in the US's Energy Brand Inc.– Glaceau and made a clean profit of $500 million in less than a year.
When he took over the mantle from legendary patriarch JRD Tata, doubts were raised about his ability to manage such a large, diversified and complex organisation, especially at a time when many old hats were in the race for the top slot.
Ratan Tata not only changed the old guard, but also made the management more vibrant, flexible, and adaptable, by bringing in a new breed of managers.
His peers envy his ability to retain managers for decades on end at a time when job-hopping is almost a norm. He once told a very senior executive who drove a small car that if he travelled in such a car, "it will be perceived that the Tata group does not pay you well". When the executive responded that Tata himself travelled in a small car on occasions, he shot back by saying that his stature was not defined by the size of his car because of obvious reasons. But in the case of executives, it was different.
Much before corporate governance became a buzzword in India Inc., Tata did not hesitate to file a criminal case against one of his perceived lieutenants and a top executive for allegedly defrauding one of his companies.
Throughout his career, which began as a management trainee in Tata Steel, he has displayed enormous courage in taking assignments that critics had written off even before they had taken off.
The Indica car project is a case in point. He infused enough confidence in the young engineers of Telco (now Tata Motors) to build a completely indigenous small car in India. This was a time when Korean and Japanese car giants were introducing swank models on Indian roads, but were averse to revealing the entire technology, mostly the gearbox technology — the heart of a car. Little wonder, when, ending months of suspense and speculation, Indica was unveiled during the Auto Expo in 1998 in Delhi, then Industry Minister Murasoli Maran described it as a "modern Kohinoor of India".
Several observers had nearly written off the project and some had even gone to the extent of saying that the project could mark the beginning of the end of Tata Motors. It did not and the rest is history.
Tata is fiercely patriotic. During 1998, he stepped in immediately to douse a nationwide rumour that there was a crisis of salt in the country. Tata issued full-page advertisements stating that there was no crisis and citizens need not hoard salt in their homes.
His perseverance and determination is best epitomised in what he recently said in an interview. "I am unfortunately a person, who has often said, 'you put a gun to my head and pull the trigger or take the gun away, I won't move my head'," a rare insight into a man, who protects his privacy, integrity and patriotism in equal measure.
The Tata group's livid response to Orient Express Hotels recently is also a manifestation of his belief about India's rising competitiveness in the global arena. The Tatas have sought an apology from Orient Express Hotels for its libelous comments about Indian Hotels, popularly known as Taj Hotels.
Krishna Kumar's response comes in the wake of a letter by White to Indian Hotels who had said that tying up with the "predominantly Indian" hospitality firm will erode the US hospitality chain's brand image.
The acquisition of Corus Steel comes in the 100th year of Tata Steel, enough reason for making the centenary celebrations even more sweet. The Corus deal is a "defining moment for Tata Steel," Ratan Tata had said in October last year after launching a recommended bid for the Anglo-Dutch steel firm.