This week Family Business Office, for its thirteenth edition of Focus On World Business Leaders brings you Ratan Tata, an Indian industrialist, philanthropist, and a former chairman of third generation Tata Sons. He was also chairman of Tata Group, from 1990 to 2012, and again, as interim chairman, from October 2016 through February 2017, and continues to head its charitable trusts.
Ratan joined Tata in 1961 when he used to work on the shop floor of Tata Steel, and was the apparent successor to J. R. D. Tata upon the latter’s retirement in 1991. He got Tata Tea to acquire Tetley, Tata Motors to acquire Jaguar Land Rover, and Tata Steel to acquire Corus, in an attempt to turn Tata from a largely India-centrist group into a global business.
Tata graduated from Riverdale Country School in New York City. In 1959, he then received a degree in Architecture from Cornell University, and in 1975, attended the seven-week Advanced Management Program of Harvard Business School — an institution which he has since endowed.
Promoted to management during the 1970s, Ratan achieved initial success by turning Group company National Radio and Electronics (NELCO) around, only to see it collapse during an economic slowdown. In 1991, J. R. D. Tata stepped down as chairman of Tata Sons, naming Ratan his successor. When he settled down into the new role, he faced stiff resistance from many companies heads, some of whom had spent decades in their respective companies and rose to become very powerful and influential due to the freedom to operate under JRD Tata. He began replacing them by setting a retirement age, and then made individual companies report operationally to the group office and made each contribute some of their profit to build and use the Tata group brand. Innovation was given priority and younger talent was infused and given responsibilities. Under his stewardship, overlapping operations in group companies were streamlined into a synergised whole, exiting unrelated businesses to take on globalisation.
During the 21 years he led the Tata Group, revenues grew over 40 times, and profit, over 50 times. Where sales of the group as a whole, overwhelmingly came from commodities when he took over, the majority sales came from brands when he exited. He conceptualised the Tata Nano car. In 2015, He explained in an interview for the Harvard Business School‘s Creating Emerging Markets project, the development of the Tata Nano was significant because it helped put cars at a price-point within reach of the average Indian consumer.
Tata is a supporter of education, medicine and rural development, and considered a leading philanthropist in India. Tata supported University of New South Wales Faculty of Engineering to develop capacitive deionization to provide improved water for challenged areas.
Reference material obtained from Tata.com,Times of India,Independent UK and The Economist.
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