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THE UNTOLD MYSTERY OF
CYRUS MISTRY
A detailed case study on the reasons behind Cyrus Mistry’s ouster from theTata Group
INTRODUCTIONTOTHETATA GROUP
 Multinational conglomerate with 100 SBU’s and operating in 80
countries.
 ‘Salt to software ‘ conglomerate of India.
 Nations largest private employer.
 Founded by Shri. Jamset jiTata
WHO IS RATANTATA?
 Son of NavalTata, Grand son of Sir RatanTata.
 Supremely educated and hardworking.
 His contribution to theTata Group during the Chairmanship.
1. Mergers andAcquisitions at its peak (Tetly, JLR, Corus steel)
2. Founder ofTata motors.
3. International diversification of the business
4. Conceptualization ofTata Nano
5. Venture capitalist
WHO IS CYRUS P. MISTRY
 Son of Pallonji Shahpoorji Mistry.
 Brother in law of Noel tata, the half-brother OfTata pioneer Shri. Ratan tata
 Director of Pallonji Group, an Indian conglomerate.
 Member ofTata since 2006.
 Contributions and controversial Strategies adopted.
1. Innovations in Automobile segment to achieve substantial markets.
2. Aggressively pursued disposal of non-profitable business(Corus steel,
Associates of IHCL)
3. Only 3 acquisitions precisely
RELATION BETWEENTATA AND PALLONJIS
 Pallonji group is the second biggest shareholder of theTata group with 18.4%
stake.
 Tata trust holds the largest stake of 66% in theTata sons.
 Family relations.
 Firm bond through construction works.
 Resulted in chairmanship of Cyrus
Mistry
ACCOLADES BY RATANTATA
 “I have been impressed with the quality
and caliber of his participation, his
astute observations and his humility, he
is intelligent and qualified to take on the
responsibility being offered and I will be
committed to working with him over
the next year to give him the exposure,
the involvement and the operating
experience to equip him to undertake
the full responsibility of the group on
my retirement.”
CHALLENGESTO MISTRY ANDTHE
ACTIONS BY HIM
1. Manage 100 companies in 80 countries across six continents
 Experience of handling an Indian conglomerateThe Pallonji group.
 Gave up all the rights and authorities at the Pallonji group
2. Getting young blood in the company boards
 Tightening the hold byTata trust.
 Allegations against Mistry for roping in his own team in the group.
 Backfired
CHALLENGESTO MISTRY ANDTHE
ACTIONS BY HIM
3.Tata Motors: Slowing vehicle sales in India; challenges to JLR in Europe
 Tata motors standalone performance decline.
 Innovations to their fullest.
( Launches, sports car segments, Engine upgradation)
 JLR division standalone performance substantial rise.
4. Tata Steel: Falling demand for the metal and huge debt burden
 Financial crisis and Chinese meltdown impact
 Job cutdowns, Mothballing, cancellation of high yielding contracts.(Marcegaglia)
 Plan to sell the business to reduce debts.
 Damage to the prestige of theTata’s.
CHALLENGESTO MISTRY ANDTHE
ACTIONS BY HIM
5. Indian Hotels: Struggling international ops with poor occupancy
 Disposal due to less profits.
6. NTT DocomoVsTata dispute
 Joint venture in 2008
 Agreement between the partners.
 Violation by theTata group leading to loss of $1.17 billion
THE REASONS FOR OUSTER OF CYRUS IN
BULLETS
 Failed to turn aroundTata Steel UK, rushed for sale.
 Tried to rope in his team in group companies and on its boards.
 In combating mood with some of the executives at the group companies
 Aggressively pursued disposal of non-profitable businesses
 More keen to build new businesses e-commerce, defense and infrastructure rather than consolidating
existing businesses
 Dividends reduced or cancelled at group companies, leading to shareholders' ire. (As the major stake
holder,TataTrusts are the largest beneficiaries of dividends throughTata Sons.)
 Tried to bring in group level mechanism to track performance of executives and employees at companies
 The emphasis on 'Profitability' applied with equal vigor on all group companies, despite the diverse
nature of the businesses
 Marketed his three years of achievements in direct comparison to previous years ofTata
THANKYOU

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The untold mystery of cyrus mistry

  • 1. THE UNTOLD MYSTERY OF CYRUS MISTRY A detailed case study on the reasons behind Cyrus Mistry’s ouster from theTata Group
  • 2. INTRODUCTIONTOTHETATA GROUP  Multinational conglomerate with 100 SBU’s and operating in 80 countries.  ‘Salt to software ‘ conglomerate of India.  Nations largest private employer.  Founded by Shri. Jamset jiTata
  • 3. WHO IS RATANTATA?  Son of NavalTata, Grand son of Sir RatanTata.  Supremely educated and hardworking.  His contribution to theTata Group during the Chairmanship. 1. Mergers andAcquisitions at its peak (Tetly, JLR, Corus steel) 2. Founder ofTata motors. 3. International diversification of the business 4. Conceptualization ofTata Nano 5. Venture capitalist
  • 4. WHO IS CYRUS P. MISTRY  Son of Pallonji Shahpoorji Mistry.  Brother in law of Noel tata, the half-brother OfTata pioneer Shri. Ratan tata  Director of Pallonji Group, an Indian conglomerate.  Member ofTata since 2006.  Contributions and controversial Strategies adopted. 1. Innovations in Automobile segment to achieve substantial markets. 2. Aggressively pursued disposal of non-profitable business(Corus steel, Associates of IHCL) 3. Only 3 acquisitions precisely
  • 5. RELATION BETWEENTATA AND PALLONJIS  Pallonji group is the second biggest shareholder of theTata group with 18.4% stake.  Tata trust holds the largest stake of 66% in theTata sons.  Family relations.  Firm bond through construction works.  Resulted in chairmanship of Cyrus Mistry
  • 6. ACCOLADES BY RATANTATA  “I have been impressed with the quality and caliber of his participation, his astute observations and his humility, he is intelligent and qualified to take on the responsibility being offered and I will be committed to working with him over the next year to give him the exposure, the involvement and the operating experience to equip him to undertake the full responsibility of the group on my retirement.”
  • 7. CHALLENGESTO MISTRY ANDTHE ACTIONS BY HIM 1. Manage 100 companies in 80 countries across six continents  Experience of handling an Indian conglomerateThe Pallonji group.  Gave up all the rights and authorities at the Pallonji group 2. Getting young blood in the company boards  Tightening the hold byTata trust.  Allegations against Mistry for roping in his own team in the group.  Backfired
  • 8. CHALLENGESTO MISTRY ANDTHE ACTIONS BY HIM 3.Tata Motors: Slowing vehicle sales in India; challenges to JLR in Europe  Tata motors standalone performance decline.  Innovations to their fullest. ( Launches, sports car segments, Engine upgradation)  JLR division standalone performance substantial rise. 4. Tata Steel: Falling demand for the metal and huge debt burden  Financial crisis and Chinese meltdown impact  Job cutdowns, Mothballing, cancellation of high yielding contracts.(Marcegaglia)  Plan to sell the business to reduce debts.  Damage to the prestige of theTata’s.
  • 9. CHALLENGESTO MISTRY ANDTHE ACTIONS BY HIM 5. Indian Hotels: Struggling international ops with poor occupancy  Disposal due to less profits. 6. NTT DocomoVsTata dispute  Joint venture in 2008  Agreement between the partners.  Violation by theTata group leading to loss of $1.17 billion
  • 10. THE REASONS FOR OUSTER OF CYRUS IN BULLETS  Failed to turn aroundTata Steel UK, rushed for sale.  Tried to rope in his team in group companies and on its boards.  In combating mood with some of the executives at the group companies  Aggressively pursued disposal of non-profitable businesses  More keen to build new businesses e-commerce, defense and infrastructure rather than consolidating existing businesses  Dividends reduced or cancelled at group companies, leading to shareholders' ire. (As the major stake holder,TataTrusts are the largest beneficiaries of dividends throughTata Sons.)  Tried to bring in group level mechanism to track performance of executives and employees at companies  The emphasis on 'Profitability' applied with equal vigor on all group companies, despite the diverse nature of the businesses  Marketed his three years of achievements in direct comparison to previous years ofTata