Did a case study during lockdown on India's most known Management guru Ratan Tata.

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THE MANAGEMENT GURU
RATAN TATA
A CASE STUDY BY
Naheeda Khan
(TYBMS Batch: 2017-20, Maniben Nanavati Women’s College) (Mumbai, India)

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TABLE OF CONTENTS :
3ABSTRACT
4INTRODUCTION
6 EARLY LIFE AND A CHANGE AGENT
8SUCCESS
10RISKTAKER AND OBSTACLES FACED BY TATA GROUP
12WHAT’S NEXT?
13PHILANTHROPY
15REFRENCES

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ABSTRACT
RATAN TATA
atan Tata is widely recognized as the person responsible for transforming the
Tata Group, a large India-based conglomerate, from an unwieldy collection of
businesses into a relatively more nimble group of companies better prepared to
take advantage of opportunities. The case discusses Ratan Tata's early days at the Tata
Group and his attempts to change the processes. It explains the steps that he took for
growth - innovation and globalization - that he chose for the Group companies.
The case then describes his vision, failures, risk-taking ability and high ethical standards.
The case ends with a brief discussion on his philanthropy and ethics values.
R

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INTRODUCTION
THE HISTORY OF TATA GROUP
Tata Group is an Indian global aggregate holding organization headquartered in
Mumbai, Maharashtra, India. Established in 1868 by Jamsetji Tata, the organization
increased worldwide acknowledgment in the wake of acquiring a few worldwide
organizations. Perhaps the biggest aggregate, Tata Group is claimed by Tata Sons.
At 29 years old, Jamsetji Tata worked in his dad's organization. In 1870 with Rs.21,000
capital, he found an exchanging organization. Further he purchased a bankrupt oil plant at
Chinchpokli and changed over it into a cotton plant, under the name Alexandra Mill
which he sold in benefit following 2 years. In 1874, he set up another cotton factory at
Nagpur named as Empress Mill. He longed for accomplishing 4 objectives, setting up an
iron and steel organization, an exceptional inn, a world-class learning establishment and a
hydro-electric plant. During his lifetime, in 1903, the Taj Mahal Hotel at Colaba
waterfront was opened making it the first inn with power in quite a while.

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After Jamsetji's passing, his more established child Dorabji Tata turned into the Chairman
in 1904. Sir Dorabji built up the Tata Iron and Steel organization (TISCO), presently
known as Tata Steel in 1907. Denoting the gathering's worldwide aspirations, Tata
Limited opened its first abroad office in London. Following the organizer's objectives,
Western India's first hydro plant was enlivened, bringing forth Tata Power. One more
dream, Indian Institute of Science was built up with the main bunch conceded in 1911.
JRD Tata was crowned Chairman of Tata Group in 1938. Under his chairmanship, the
benefits of the Tata Group developed from $100 million to over $5 billion. Beginning
with 14 undertakings, upon his takeoff 50 years after the fact in 1988, Tata Sons had
developed to a combination of 95 endeavors. These endeavors comprised of adventures
that the organization had either begun or in which they held controlling interest.
In 1952, JRD established an aircraft, known as Tata Air Services (later renamed Tata
Airlines). In 1953, the Government of India passed the Air Corporations Act and
acquired a larger part stake in the transporter from Tata Sons, however JRD Tata would
proceed as Chairman till 1977.
In 1945, Tata Motors was established, first centered around trains. In 1954, it entered the
business vehicle showcase in the wake of shaping a joint endeavor with Daimler-Benz. In
1968, Tata Consultancy Services was established.
In 1991, Ratan Tata was crowned Chairman of Tata Group. This was additionally the
time of financial advancement in India, opening up the market to remote contenders.
During this time, Tata Group started to obtain various organizations, including Tetley
(2000), Corus Group (2007), and Jaguar and Land Rover (2008). In 2017, Natarajan
Chandrasekaran was named administrator.

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EARLY LIFE OF RATAN TATA
Ratan Tata was born in Mumbai (then Bombay) on December 28, 1937, to Soonoo and
Naval Hormusji Tata, both Gujarati -speaking Parsis . He was the grandson of Jamsetji
Tata, founder of the Tata Group. Ratan
Tata had a troubled childhood as his
parents split.He was raised by his
grandmother, Lady Navajbai in the lap
of luxury at Tata Palace. America held
a special fascination for the Tata scion
and he went to Cornell University to
study architecture and structural
engineering. Later he pursued a
management course from Harvard
University.
In 1962, he joined the Tata Group and
his first job involved working with the
Tata Steel division in Jamshedpur,
where he worked with the blue-collar
employees shoveling stone and working with the furnaces. He was appointed the
Director-in-Charge of the National Radio & Electronics Company Limited (Nelco) in
1971 and was successful in turning Nelco around, only to see it collapse during an
economic slowdown.

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A CHANGE AGENT
Ratan Tata became chairman of Tata Industries a decade later and in 1991 succeeded his
uncle, J.R.D. Tata, as chairman of the Tata Group.
hen 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, with the salt-to-software group exiting unrelated businesses to take on
globalization.
Tata Consultancy Services went public and Tata Motors was listed in the New York
Stock Exchange giving it more international power and recognition. He is credited with
leading the Tatas' successful bid for Corus- an Anglo-Dutch steel and aluminum producer
as well as Jaguar and Land Rover brands from the Ford Company.
W

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SUCCESS
During the 21 years he led the Tata Group, revenues grew over 40 times, and profit, over
50 times. The company witnessed the launch of India’s first truly Indian car, ‘Indica’.
The car was the brainchild of Tata. 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 boldly got Tata Tea to acquire Tetley, Tata Motors to acquire Jaguar
Land Rover and Tata Steel to acquire Corus. All this turned Tata from a largely India-
centric group into a global business, with over 65% revenues coming from operations and
sales in over 100 countries.
In year 2000, he was honored with Padma Bhushan by the government of India. He was
also conferred an honorary doctorate in business administration by Ohio State University,
an honorary doctorate in technology by the Asian Institute of Technology, Bangkok, and
an honorary doctorate in science by the University of Warwick. Tata has a personal
fortune of GBP 300 million and owns less than 1% of the colossal group. Over two thirds
of Tata Group is owned by charitable trusts that finance good causes.

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In December 2012 Tata retired as chairman of the Tata Group. He briefly served
as interim chairman beginning in October 2016 following the ouster of his successor,
Cyrus Mistry. Tata returned to retirement in January 2017 when Natarajan
Chandrasekaran was appointed chairman of the Tata Group.
A bachelor in real life, Tata loves privacy and shuns media spotlight. He has only CDs,
books and dogs for company. The business baron drives himself to work in an
unremarkable Tata sedan.

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THE RISK TAKER
He conceptualised the Tata Nano car, a tiny rear-engined, pod-shaped vehicle with a
starting price of approximately 100,000 Indian rupees, or about $2,000. Although only
slightly more than 10 feet (3 metres) long and about 5 feet (1.5 metres) wide, the highly
touted “People’s Car” could seat up to five adults and, in Tata’s words, would provide a
“safe, affordable, all-weather form of transport” to millions of middle- and lower-income
consumers both in India and abroad. Its commercial vehicles had lost share in the
domestic market, down to 44.4 per cent in March 2017 from a high of nearly 60 per cent
five years before that. In the passenger vehicles business, it struggled to keep pace with
competitors. Tata Motors made its foray into cars three decades back. Their market share
continues to be insignificant and the division struggles to make profits. Contrast that with
some other companies which entered the market much later, and have performed well,
taking advantage of the growth in the Indian four wheeler market. In 2018, when the auto
maker lost market share in the last 4-5 years, the country looked at it as a 'failing
company'.

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OBSTACLES FACED BY TATA
When Ratan Tata became the chairman in 1991, he had a mammoth task set before him.
His futuristic views and liberal attitude did not go well with some of the top honchos at
Tata which resulted in a tussle at the management level. At the very start of his career as
chairman, two companies under him faced bankruptcy and his employees faith in him
dwindled as he brought down the retirement age from 70 to 65, leading to an ouster of
some of the oldest employees of the organization.
Due to the Global financial crisis, the Indian automobile sector was highly affected: the
GDP growth declined and inflation took place due to which the prices of the fuels and
automobiles products increased and hence Tata Motors, the leading automobile company
of India suffered the most.
The biggest failure has been the telecom business. The last two decades have witnessed
the vibrant growth of the Indian telecom industry that has been unmatched almost
anywhere in the world. Everyone who entered the business has earned handsomely and
created value for the industry and for himself, except of course the Tatas. Starting off
with their choice of technology (CDMA over GSMA), Tata Tele is a case study in poor
management. The business has now been sold off to Bharti Airtel, on terms that have
inflicted huge losses on the Tata group.
Despite the many failures he has seen, Tata Nano being the latest, Ratan Tata did not
give up and continues to be a global figure even today.

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WHAT’S NEXT?
Ratan Tata believed that the biggest challenge for the Group was finding the right talent
and retaining the Group's value systems as it grew bigger and more diverse.Today, Ratan
Tata needs no introduction as he is the most respected business tycoon in India. Post his
retirement in 2012 he has turned into an avid angel investor who has left an everlasting
impact. He is well-known for investing in some of the most successful startups today.
So far, Ratan Tata has invested in over two dozen startups, including top unicorns of
India, like furniture e-tailer Urban Ladder, digital payments app Paytm, ride-hailing
company Ola and its electric vehicle arm Ola Electric Mobility, Cure.fit, Urban Ladder,
etc. His investment may only be a few million dollars, according to industry sources, but
what’s invaluable is having the 81-year-old tycoon’s name attached to a young startup
The business magnate, better known as the ''Accidental Startup Investor'', was always
interested in the startup ecosystem. The first investment he made was in Snapdeal in
2014 which yielded great results. The CEO of Snapdeal, Kunal Bahl, has high regards
for Ratan Tata and considers him to be a lucky charm for Snapdeal. He is believed to
have bought a 0.17% stake in Snapdeal in August 2014, when he invested less than Rs 5
crore. Tata bought 256 shares from the e-commerce company’s angel investors, including
Kenneth Glass. He has invested in 31 startups.

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VALUE DRIVEN AND
PHILANTHROPY
Ratan Tata is a philanthropist and more than 65% of his share is invested in charitable
trusts. His aim has been to raise the quality of life for Indians along with Human
Development. Ratan thinks that 'Philanthropy' can be seen in different perspectives,
earlier 'philanthropy' was to develop institutions, charitable hospitals etc. whereas, now
it’s more about nation building.
Tata is a supporter of education, medicine and rural development, and considered a
leading philanthropist in India. From the beginning, the management at Tata Group had
sought to function with ethics, integrity, social consciousness, and fairness. Tata set a
perfect example of generosity and leadership during the 26/11 attacks. Unarmed he stood
all alone outside the Taj hotel and supervised the activities to help the victims. He
showcased his humane gesture by personally visiting the families of all the 80 employees
who were killed or injured. He left no stone unturned to provide relief to the victims
andeven asked the families and dependents as to what they wanted him to do.
"He [Ratan Tata] comes across as an individual with clarity and conviction, a business
leader with vision. Ratan Tata has steered the Tata ship in turbulent times. ...above all, I
have an immense admiration for Ratan Tata, the man, for his unassuming and warm
nature, an outstanding business leader imbued with social concerns and committed to
uphold ethics and values."
- MukeshAmbani, Chairman and Managing Director of Reliance Industries,
December 29, 2001

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His also steered plan to provide cheap and clean drinking water and helped a few Pune-
based designers develop a sub-Rs 1,000 water purifier, Swach. DesignDirections
Private Limited took more than three years to make this 560-mm unit for purifying
water.
A Trust controlled by the TATA Group has committed RS. 1500 Crore for the fight
against the covid-19 pandemic, one of the biggest corporate donations in the country.
The Tata Group is also providing accommodation at the Taj Hotel, Colaba and Taj Lands
End, Bandra for Doctors and Nurses working in BMC Hospitals amidst Corona Virus
Crisis.
CONCLUSION:
As far as the Tata group is concerned , it has gone a long way in fulfilling its duty and
responsibility towards the society and the nation. It has reached the masses to elevate
their lives, to nurture their dreams and to hone their skills justifying the statement of the
founder “We do not claim to be more unselfish, more generous and more philanthropic
than other people. But we think we started on sound and straightforward business
principles, considering the interests of the shareholder, our own, and the health and
welfare of the employees, the sure foundation of our prosperity”.- Ratan Tata

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REFRENCES
I: The Business Sectors of Tata Group as of 2008
II: About JRD Tata
III: The Pioneers of Tata Group
IV: Business Portfolio of Tata Group in 1962
V. "The Tata group: Out of India". The Economist.
VI. https://www.britannica.com/biography/Ratan-Tata
VII. https://startuptalky.com/ratan-tata-startup-investment/
VIII. https://www.indiatimes.com/lifestyle/self/9-indian-failures-who-became-inspirational-success-
stories-227984.html
IX. https://www.tatatrusts.org/article/inside/ratan-n-tata