Ratan Tata, one of the most iconic business tycoons of the 20th and 21st centuries, a philanthropist par excellence and a luminary figure whose life inspires three generations of entrepreneurs, passed away yesterday due to a prolonged illness. His death, as was his life evoked tributes from across the world spanning multiple communities – Business and Non-Business alike. In his honour, the Indian state of Maharashtra declared a day of mourning today. The Indian National flag was flown at half-mast across government offices. He was cremated in the Worli area of Mumbai today.
Let us peek into the life and times of this man, who was pivotal in setting up the Indian corporate construct.
Personal Life:
1- He was the son of Naval Tata who was adopted by Ratanji Tata, son of Jamsedhji Tata, the founder of the Tata Group. Born in Mumbai on December 28, 1931, in a Parsi family, Ratan Tata spent most of his childhood in India, under his maternal Grandmother’s care after his parents separated. In some of his conversations, he often highlighted and spoke about his love life and how he almost got married in Los Angeles.
2—Due to unfortunate circumstances, Ratan Tata had to move back to India due to his Grandmother’s ailing health. However, due to the ongoing instability in India owing to the Indo-China war, his future spouse did not move along with him, which unfortunately ended their relationship.
Education and Career:
3- Mr Ratan Tata studied at the Campion School, Mumbai till the 8th grade after which he studied at the Bishop Cotton School in Shimla and the Riverdale Country School in New York City. After graduating from high school in 1955, he enrolled at Cornell University, where he graduated with a degree in architecture and engineering in 1959. In 2008, Mr Tata donated Cornell $50 Million becoming the largest international donor in the university’s history.
4—In 1970, Mr Ratan Tata was offered a managerial position in the Tata Group. The 21 years that ensued saw Revenue growth of over 40 times and profit growth of over 50 times. He successfully transitioned the organization from a process-centric to a product-centric firm.
Taking the Helm:
4- This journey began when Mr JRD Tata stepped down and Mr Ratan Tata took over as the chairman of the Tata Group in 1991. This news did not augur well within the Tata group and many executives within the group including Russi Mody(Tata Steel), Ajit Kerkar(Taj Hotels), Darbari Seth(Tata Tea, Tata Chemicals) and Nani Palkhvala(Director on Board of several Tata companies). This led to a bitter feud within the group.
5- The media too branded Ratan Tata as the wrong choice. But Mr Ratan Tata persevered. During his tenure, he set the retirement age. Retirement age was set at age 70 and for senior executives, the age was set at 65. Due to this policy, a lot of ageing executives had to step down. Youngblood was infused in the senior leadership.
6– Once the succession issue was resolved, a lot of policy changes were introduced at the group level. Mr Ratan Tata convinced the group firms to pay a royalty to Tata & Sons for the use of the brand name Tata and also made the individual companies report to the group office.
7- Under his leadership, the group exited businesses such as cement, textiles, and cosmetics and increased its focus on software, telecom, retail and finance. All this time amid severe criticism, JRD Tata guided the young Ratan Tata in a steadfast approach.
Leadership Marked By Phenomenal Achievements:
1- Despite major criticisms owing to inexperience, he took over the reins of the group and led it to become a global conglomerate, with 65% of the revenues coming from abroad. The Group made several strategic acquisitions during his tenure.
2- Some of the major acquisitions include the purchase of London-based Tetley Tea for $ 431.3 million, South Korean truck manufacturer Daewoo Motors for $102 million, the Corus group for $11.3 billion and the Ford-owned Jaguar Land Rover for $2.8 billion.
3– These acquisitions expanded the Tata Group’s global footprint spread 100 countries. This gave a strong fillip to the Indian Industrial sector.
Philanthropy:
He established the Sir Dorabji Tata Trust, thus realizing his father’s vision. Approximately 60-65% of his earnings were donated for charitable purposes. Some of his major contributions were in the fields of Education, Health Care and Agricultural Development.
His exemplary life and journey offer valuable lessons for anyone who wishes to create an impact on a positive scale across the world. His pursuit and adherence to the ethical adage, excellence, innovation, relentless perseverance, compassion and willingness to lead by example sets him apart from the multitude of business leaders we witness today. His life is a lesson for the upcoming leaders who wish to foray into growth without ever losing focus on sustainability and giving back to society.
