The amazing story of how Ratan Tata built an empire...!!!!!
He's packing his bags -- again. December 2012, when he turns 75, is the third
scheduled retirement for Ratan Tata.
The Tata Group has been at this inflection point twice earlier, and stepped back
both times. In 2002, when Tata was to retire at 65, the Tata Sons board promptly
redesignated him non-executive chairman, which meant he could continue for
another five years.
Three years later, the board upped the retirement age of non-executive directors
to 75. The message is clear: Ratan Tata is indispensable.
And it's not just the board that feels that way. There were loud cries of
support from shareholders at the Tata Steel AGM in August, held soon after the
announcement that Tata Sons had created a panel to find Tata's successor.
"We can't lose our ratan (jewel)," said one shareholder, while others asked him
to stay on as chairman emeritus.
Whether or not he acknowledges it openly, Tata must be feeling vindicated by
this public recognition of his worth. When he took over as Tata Group chairman
on March 25, 1991, critics were loud and unrestrained in their disapproval and
Ratan Tata was considered to have gained his position purely on the strength of
his surname; he was incompetent, raged opponents both within and outside Bombay
House, and he didn't possess an iota of the charisma of his uncle and
predecessor, JRD Tata.
Nearly 20 years later, Ratan Tata has achieved almost everything on his 1991
agenda. At Rs 3.46 lakh crore (Rs 3.46 trillion), Tata Group revenue is 40 times
the 1991 level, while net profit has gone up four times.
It is the largest Indian multinational conglomerate; more than 65% of the
group's income comes from overseas and it has 98 operating companies (28 listed)
spread across 56 countries in six continents.
In the past decade -- the decade that marked the glorious years of Ratan Tata --
nearly $18 billion was shelled out to acquire 22 companies worldwide, including
Tetley Tea and Corus Steel in the UK, New York's Pierre Hotel and Jaguar Land
The Tata Group includes India's largest private steel company, the biggest auto
manufacturer and the largest IT outsourcing firm.
"Ratan Tata outperformed JRD. He toppled people as strong as Russi Mody, thought
out of the box and came up with path-breaking concepts like the Nano," says Bala
V Balachandran, faculty member at Kellogg School of Management, and dean of the
Great Lakes Institute of Management.
Not bad going for a man who was once likened to the clown in a circus (by his
loudest detractor, Russi Mody). For Tata's successor -- whoever that turns out
to be -- the bar's been raised sky high.
"Tata's job is the most difficult one in the country today. Whoever runs the
Tata Group has to provide strategic leadership, direction and inputs on multiple
businesses, which is hugely challenging," says Rajeev Gupta, managing director
of private equity firm Carlyle India.
The new chairman may be relieved of the responsibility of running individual
companies, but he or she will have to head a team of extraordinarily talented
and able leaders.
Not only will the heir have to ensure continuation of the group's growth
momentum, but also provide the direction and vision for future growth. It's not
an easy task. But then, nor was Tata's.
A shaky start
Left to himself, Ratan Tata would probably have stayed on in the United States
after training as an architect at Cornell University. But the son of deputy
group chairman Naval Tata and the nephew of JRD Tata couldn't be allowed to work
outside the group (he had an offer from IBM).
In 1962, Ratan joined the family business, working on the Tata Steel shopfloor
at Jamshedpur, just one of several thousand employees.
He got his first independent assignment less than a decade later -- as director
of National Radio and Electronics (Nelco), in 1971 -- but it was a mixed
blessing. Nelco was in dire straits when Ratan came on board -- losses of 40%
and barely 2% share of the consumer electronics market.
Just when he turned it around, the Emergency was declared. A weak economy and
labour issues compounded the problem and Nelco was quickly near collapse again.
Ratan's next assignment was just as trouble-stricken. He was asked to turn
around the sick Empress Mills. He did, but was refused the Rs 50 lakh (Rs 5
million) investment required to make the textile unit competitive. Empress Mills
floundered and was finally closed in 1986 (by which time the infamous Mumbai
textile workers' strike had also taken its toll).
The two 'failures' haunted Ratan for decades. His track record was suspect, he
was jinxed, said his baiters. "My first directorship was that of Nelco and the
status of that company has forever been held against me. No one wanted to see
that Nelco did become profitable, that it went from a 2% market share to a 25%
market share," Tata said several years later.
The attacks became more vicious after 1981, when JRD stepped down as Tata
Industries chairman, naming Ratan his successor -- in one leap, Ratan had moved
to the head of the queue for eventual leadership of the entire Tata Group, and
that was completely unacceptable to many.
So much so, that at one Tata Sons meeting, when Nelco's losses were being blamed
on Ratan (although he came to the company much later), JRD had to step in and
deflect the criticism.
Later, recalling the incident, Ratan was to remark, "Jeh came to my rescue and
slowly turned around the whole conversation."
But even JRD's backing wasn't enough to help Ratan achieve many of his ambitions
for the group. Foreseeing expansion of capital markets, which meant easier
access to money for new projects, Ratan helped draw up a group strategic plan in
Among other things, it emphasised venturing into hi-tech businesses; focussing
on select markets and products; judicious mergers and acquisitions; and
leveraging group synergies.
Accordingly, Ratan promoted seven hi-tech businesses under Tata Industries in
the eighties: Tata Telecom, Tata Finance, Tata Keltron, Hitech Drilling
Services, Tata Honeywell, Tata Elxsi and Plantek.
But elsewhere in the group, his blueprint gathered cobwebs as companies -- many
of which were run by their CEOs as independent fiefdoms under JRD's benevolent
leadership -- blatantly ignored it or at best, paid lip service to the 1983
New businesses and M&As in these companies, if they happened, occurred
independent of Ratan, not because of him.
Ratan's spell of bad luck continued -- even as his successes grew. He was
steadily finding a place on the board of many group companies, having become a
director at Tata Sons back in 1974.
In 1988, he took over from Sumant Moolgaokar as Telco chairman -- and promptly
found himself at the centre of a prolonged labour dispute, perhaps the worst
industrial relations slide in Tata history.
Ratan stood firm and eventually the matter was resolved in the company's favour.
In an interview some years ago, Ratan recalled that Telco was "the first company
in which I could actually do something. In other companies, I was always put in
a fire-fighting situation."
Back against the wall
Taking over from JRD as group chairman in 1991 didn't resolve matters either,
even though it was a Tata Sons board decision to make him group chairman.
Tata Group historian R M Lala recalls speaking with JRD some 10 days after the
announcement and asking whether Ratan had been chosen because of his integrity.
"Oh no, I wouldn't say that; that would mean the others did not have integrity,"
JRD replied. "I chose him because of his memory. Ratan will be more like me."
JRD may have seen his own reflection in his successor but others, both inside
and outside Bombay House, did not, at least initially. "Who expected Ratan Tata
to become such a towering figure in his own right? The first three or four years
were engaged in struggles with the satraps," says Lala.
Individual company heads were larger-than-life personalities in their own right,
and had ruled these satraps for decades: Russi Mody at Tata Steel, Darbari Seth
at Tata Chemicals, Ajit Kerkar at Indian Hotels, and Nani Palkhivala at ACC.
Getting them to toe a group line and work in tandem with other companies was
next to impossible.
It didn't help that they were more experienced and, many believed, more
deserving than Ratan to head the group. Indeed, in an interview a few years ago,
Ratan recalled his surprise on hearing of his appointment: he had thought
Palkhivala and Mody to be neck-and-neck in the race for the top post.
As it happened, Palkhivala's political views and Mody's clashes within the group
worked against them. Mody, though, continued to be a thorn in the flesh of both
JRD and Ratan. His battles with Ratan were loud, acrimonious and conducted in
full public view, which went against the ethos of this low-key business house --
an inside joke at the time was that Russi Mody had become Rude-i Mody. JRD
finally dismissed him in 1993.
Ratan enforced the long-dormant retirement age rule for all business heads and
directors, which effectively dealt with Seth and Kerkar (ill-health hastened
But the crown remained shaky for several years -- there was conjecture as late
as 1997 that Shapoorji Pallonji Mistry would oust Ratan and take over the mantle
of Tata Group head. (Mistry is the single largest shareholder in Tata Sons and,
incidentally, the father-in-law of Noel Tata, Ratan's half-brother and the
frontrunner in the current succession race.)
Business as unusual
To his credit, Tata didn't let the criticism and internecine battles deflect him
from his chosen path. On taking over in 1991, he dusted off the 1983 plan and
updated it, taking the newly-opened economy into account.
Now, the thrust was equally on technology-driven leadership, global
competitiveness and being among the top three domestically, regardless of the
line of business.
That meant rationalising the Tata business structure. The remnants of the era of
government controls combined with independent functioning of group companies in
decades past could be seen in the way the group had grown till then --
unstructured, with overlapping business across multiple companies.
When Ratan took over, there were three group companies manufacturing cement;
five were involved in pharmaceuticals, while nine companies operated in the IT
space. One of his first acts was to sell Tomco; swift exits from pharma and
textiles and, later, cement, followed.
Management consultancy McKinsey was brought on board to help with the
reorganisation. The Tata Group is still a diversified, salt-to-software group,
but now there is a method to the business expansion.
Tata also paid attention to brand Tata. By 1998, there was a single group logo
and the Tata brand belonged to Tata Sons. Now, companies needed to sign brand
equity and business promotion agreements with Tata Sons before they got use of
the brand name.
And Ratan was choosy about its use (stepmother Simone's cosmetics business,
Lakme, which was later sold, and half-brother Noel's retail business didn't make
Zia Mody, managing partner at law firm AZB & Partners, which has advised the
Tatas on acquisitions like Corus and Jaguar Land Rover, believes the
group-culture Ratan Tata has created will stay on as his legacy.
"He has institutionalised processes. The reputation of the group and its guiding
principles are uppermost in his mind while taking decisions," she points out.
Business historian and writer Gita Piramal has a different take on Ratan Tata's
legacy. "Tata put 'design' into the group -- in mergers and acquisitions,
engineering or cars or anything else. It is a very forward-looking strategy,
putting new competency in very old companies," she says.
Ratan the manager
Perhaps the secret of Ratan Tata's success lies in his ability to think big --
and small. While he guides the Tata Group to pick up the luxurious Pierre Hotel
in New York, he's also driving the launch of the budget Ginger hotels in India.
He has the ability to envisage an automotive business that encompasses diverse
businesses such as the iconic Jaguar and Land Rover marques on the one hand, the
world's cheapest car the Nano, on the other, and hardy, rough-road trucks
sandwiched in between.
JRD is admired for creating world-class companies that could be globally
competitive at a time when India was still not thinking scale and was instead
leaning towards a socialist set up.
In contrast, Ratan had the vision to foresee the direction the economy -- and
policy -- was taking, consolidate the business accordingly, and embrace change
to leap ahead.
The group was totally unprepared for liberalisation, which was knocking on the
door when he took over. Ratan knew the Tatas required a radical change in
mindset and he set out to work in that direction.
He streamlined the organisation by selling some businesses and rationalised the
processes and functioning of the Tata Group.
That explains why it still remains among the top three business groups in the
country while many have fallen by the wayside -- or dropped in the rankings --
in the post-liberalisation era.
Yet almost none of this change came at the cost of people or employee morale. Be
it the fixing of a retirement age for various employees or the creation of a
close-knit group that could meet the group's ambitions, Ratan created a
Insiders say that those who were asked to leave were given full salary till the
age of 60.
It's no secret that the genesis of the Tata Group's blockbuster moves can be
traced to him. Tata's first global venture -- the February 2000 purchase of
Tetley -- had begun five years earlier when Ratan Tata made a $318 million bid
for the tea company.
That didn't work out, but Ratan didn't lose heart and kept an eye on the
company's activities. The deal was finally clinched at $430 million. Sheer
perseverance may have made that deal come true.
The Corus deal is also a telling example. A close associate recalls Ratan
calling Tata Steel MD B Muthuraman, who was on a trip to Hong Kong. "I've learnt
that Corus is up for sale. Do you think we can look at it?" he asked. After some
thought, Muthuraman replied that they could perhaps pick up a strategic stake.
Ratan had different plans. "We must buy that company. Think it over," he
advised. The next morning, Muthuraman called Tata to say he was game. With no
disrespect to Muthuraman and other leaders who have spearheaded the various
companies in the group, it must be said that such gutsy deals can't be done
without a strong group backing or reputation.
The Corus deal is proof of the kind of goodwill the Tata Group has created for
itself across the world, not just within the country. Unlike the Mittal Steel
bid for Arcelor, which created a huge furore, the Tata bid faced little
Although the Anglo-Dutch company had several plants in the United Kingdom, there
was little attempt to stop the deal by either political parties or trade unions.
The Corus management was happy to support the deal, placing its faith in the
group's reassurance that there would be no layoffs and that pension shortfalls
would be taken care off.
Not just that. Given that Tata Steel was bidding for a company four times its
size, it could not have funded the entire deal. In fact, the company put up just
25% of the equity; the rest was funded through foreign debt.
And even that was to be funded only through cash flows from Corus, with no
recourse to Tata Steel -- a reflection of the credibility the group enjoyed in
global financial markets.
Tata's big deals are balanced by projects focusing on the lowest common
denominator. In fact, Tata has been among the very few to perfectly understand
the pysche and the needs of the Indian consumer -- and build successful
businesses around those insights.
That is, by recognising that the big market opportunity lies in making desirable
products affordable for a larger audience and creating successful products to
cater to a market need -- be it the passenger-car foray with the Indica in the
early 1990s, the promise to create a Rs 1 lakh (Rs 100,000) car or for that
matter, making water filters that don't need electricity (for rural areas).
Hemendra Kothari, the doyen of investment banking in India who has worked on
most Tata Group deals, has watched Tata's working style closely. "He is a very
discerning person when it comes to decision-making. And once he has made up his
mind, he is prepared to go all out to achieve his objective, be it Corus or Nano,"
Still, the markets have usually considered Tata to be out of his depth,
questioning -- and dismissing -- his big, bold moves as 'Ratan's follies'.
The Indica was the first. People scoffed openly, when, in 1995, Tata spoke of
building a passenger car with "the Zen's size, the Ambassador's internal
dimensions and the price of a Maruti 800".
The scepticism seemed justified as project costs escalated to Rs 1,700 crore (Rs
17 billion) and Tata Motors posted Rs 500 crore (Rs 5 billion) in losses -- the
biggest splash of red in Indian balance-sheet history.
"Even within Tatas, people kept asking me to distance myself from the project so
that when it failed I wouldn't be stuck with the blame. And when I refused to do
that, they distanced themselves from me," Tata said in an interview a few years
Ratan proved his detractors wrong, and how. Indica went on to become Tata
Motors' great success story -- about a million units have been sold since its
The group's global ambitions were greeted with similar scepticism. The Corus
deal would lead the group to bankruptcy, critics declared: investors dumped Tata
Steel shares after the announcement, and the share price plunged 11%.
And Tata was driving straight to disaster with the Jaguar-Land Rover deal: the
brands were troubled, demand was low. Tata went on to prove everyone wrong. The
group's international acquisitions are doing well, some have started making
When Tata took over, less than 5% of the group's revenues came from overseas. As
the self-consciousness eased, the confidence grew. And with it, the scale of
The Ratan Tata of 15 years ago would never have gone for broke on deals like
Corus and JLR. The JLR deal was audacious. Tata's interest was sparked as soon
as the banks told the group that the marques were available. Why? According to
him, "First, as Tata Motors in the number two SUV builder in India, owning [Land
Rover] the gold standard of SUVs would be an enormous benefit to us. Second, to
own a luxury brand with an immense history and heritage such as Jaguar is a
virtually irresistible opportunity."
There's a personal angle to the "immense history": Ratan's father Naval was one
of five people in India who took delivery of a new Jaguar XK120 in the late
1940s. "I remember the XK with great nostalgia," Tata commented to a Jaguar
team. "I particularly remember the instruments on the dashboard and how stylish
Less than two weeks after the $3-billion deal was inked, Tata flew into the US
on his private jet to meet Jaguar and Rover dealers across the country; for many
dealers, it was their first ever interaction with a company executive.
Several years ago, in an interview, Tata dismissed the notion that he was a
risk-taker. "There have been certain occasions when I have been a risk taker.
Perhaps more so than some, and less so than certain others. It is a question of
where you view that from. I have never been speculative. I have never been a
real gambler in the sense that some very successful businessmen have been," he
Going by that logic, Ratan's 'follies' were decisions guided by prescience and
not instinct and gut feel.
Of course, he's not perfect. Ratan Tata personally, and the Tata Group in
general, have been bogged down by their share of controversies. When it comes to
the environment, especially, the group gets a "can do better" grade.
In recent years, Tata Steel's joint venture with Larsen & Toubro to construct a
port at Dhamra, Orissa, has come under the scanner for its proximity to two
protected areas, one of which is the world's largest nesting site for the
endangered Olive Ridley Turtle and the other India's second-largest mangrove
A soda ash extraction plant in Tanzania also came under fire because of the
threat it poses to a nearby lake and its flamingo population.
Tribal rights have also been a touchy subject. In 2006, several tribals were
killed while protesting a wall being built by Tata Steel on land that was
historically theirs. And Ratan Tata's pet Nano project was mired in controversy
about land acquisition for the factory. After farmers in Singur, West Bengal,
protested about forcible evictions and inadequate compensation, and Mamata
Banerjee leapt into the fray, the Tatas pulled out of the state.
The company shifted the factory to Sanand, Gujarat, but Ratan Tata's subsequent
praise for controversial Gujarat Chief Minister Narendra Modi also drew
It will be some months before even the shortlist for Ratan's successor is known.
It's anybody's guess who will finally make the cut, but the qualities expected
of this paragon are fairly clear to all.
In an interview a few years ago, Ratan had drawn up a somewhat simplistic
checklist: someone "younger", ideally in his 40s, who believes in Tata values,
demonstrates managerial ability and has the vision to run the Tata Group.
More recently, he also spelled out what the person doesn't need to be: a Tata,
Parsi, or even Indian. "The successor should be the right person," was his
emphasis at the Tata Chemicals AGM in August.
For the record, in its 142-year history, the Tata Group has had only five
chairmen, all of whom were Parsis. The only non-Tata to make it to the top was
Nowroji Saklatwala, who was chairman from 1932 to 1938. Of course, he was still
family: Saklatwala was Jamsetji Tata's sister's son.
"There will be a vacuum if a non-Tata person is at the top. Any new person
without the Tata name starts with a huge disadvantage," says Harish Bijoor,
brand specialist and CEO of Harish Bijoor Consults.
Still, considering there aren't too many Tatas around anymore, perhaps it does
make sense to keep an open mind about candidates from outside the family. But
not outside the company, and certainly not outside the country, seems to be the
Former Tata Steel CMD Russi Mody doesn't consider the lack of the right surname
a handicap -- "I was a chairman although I wasn't a Tata," he says -- but is
quite sure that only a company man will do for the job.
"This is an Indian company and an Indian should be appointed chairman. A company
man will have loyalty to the group," he declares.
Preety Kumar, managing partner at global executive search firm Amrop, gives the
neutral observer's viewpoint. "Internal succession always has smoother
transition than an external one. In some of our work, successor appointments
have been made two or three years before the succession, which helps change
perceptions," she says.
Sanjay Teli, MD of executive search firm ESP Consultants, adds that group
acceptance of and support to the heir apparent is critical. "Ratan Tata's
personality and the changes he brought about helped attract the best talent to
the group. Retaining some of those people may become an issue in the future," he
Those and other important issues must be top of mind for the selection committee
as it searches for the ideal candidate. The five-member panel -- comprising Tata
Sons vice chairman NA Soonawala, group advisor Shirin Bharucha, British
businessman Lord Bhattacharya, Tata Sons director Cyrus Mistry and Indian Hotels
vice chairman R K Krishnakumar -- is expected to announce its choice by March
2011, which leaves room for a reasonably long handover period.
The actual selection process isn't public, but it is known that Tata and other
senior executives have given their inputs on what to look for. "It's a
scientific process," says a person familiar with the broad workings of the
"The candidates will be evaluated on leadership qualities, management skills,
operational performance and other criteria. There will be a matrix and the top
scorer will get the top job."
As it happens, those are precisely the qualities that catapulted B Muthuraman to
the top job at Tata Steel in 2001. When J J Irani's retirement was imminent,
three people were considered likely successors -- Muthuraman and T Mukherjee,
both executive directors, and Firdose A Vandrewala, who was responsible for
sales and marketing, as well as new business initiatives at the company.
"Tata asked all three to prepare a presentation on the future of Tata Steel.
Muthuraman's vision and roadmap was crisp, clear and the most appropriate," says
a 30-year veteran of the company.
Background and prior domain expertise aren't make-or-break criteria for Ratan
Tata, perhaps because he's living proof that track records can be deceptive or
Anil Sardana was CEO of North Delhi Power when he was picked to lead Tata
Teleservices (TTSL), a different industry altogether. He's already proved that
the group's confidence in him was justified: from a user base of 15 million in
August 2007 when he took over, TTSL now has 75 million.
The old order changeth
In many ways, the successor's task will be easier than Ratan's. It begins with
the selection process itself. When Ratan took over from JRD, it was a succession
fraught with intrigue, suspense and bad blood.
Resentment from established camps within the group at what was seen as an
arbitrary decision was only compounded by Ratan's own admission of surprise at
the announcement. The ongoing selection process may be equally opaque -- at
least, at present -- but there is some logic and purpose behind it, which should
make the panel's decision easier to accept.
The new chairman is also not likely to be battling cliques and fiefdoms within
the group -- his predecessor has already taken care of that. Instead of the
"corporate commonwealth" that Ratan inherited, the Tata Group now operates more
or less as a cohesive unit, which will work to the successor's advantage.
Besides, there is now frequent churn at the board-level as senior members attain
retirement age -- most Tata Sons board members are nearing 75, when
non-executive directors have to retire. The heads of the three biggest companies
in the group also retired last year: there's fresh blood at the top at Tata
Motors, Tata Steel and Tata Consultancy Services.
Also, when Ratan took over, the Tata family had neither financial nor managerial
control over many group companies. Indeed, at one point in the 1980s, the Birlas
owned more stock in Tisco than the Tatas (through Tata Sons) did. That
vulnerability to outside interference is now greatly reduced: Tata Sons' holding
in most group companies is now around 26%, sometimes more.
Clearly, the old order has changed. But some things will remain constant -- Tata
stepped into the shoes of a giant in 1991. His successor will do likewise.
Ratan Tata, the person
1937 Born in Mumbai on Dec 28.
1962 Completes BSc in architecture from Cornell University.
1962 Joins Tata Group.
1971 Appointed Director of The National Radio & Electronics (Nelco).
1974 Becomes a Director in Tata Sons.
1975 Completes management programme from Harvard Business School.
1977 Given charge of Empress Mills.
1981 Named Chairman of Tata Industries.
1984 Sale of Tomco
1991 Takes over as group chairman from JRD Tata.
From driving cars to flying choppers, from charity to business strategy, Ratan
Tata does it all, and he does it passionately. But, despite being the cynosure
of all eyes, very little is known about the Tata Sons chairman's personal life.
"He is a very private man. Even his closest business aides know little about
what he does in his free time," says a veteran at the group.
It's anybody's guess what Tata will do after he steps down from the country's
top private sector job. Those who know him well believe he will indulge in all
his pet interests, things he didn't have enough time for while helming the Tata
A bachelor, Tata continues to live in a flat in Colaba, filled with books and
dogs. Cars and planes are his biggest -- and perhaps, only -- indulgences. He
has eight or nine cars in his stable, including a Chrysler Sebring, Land Rover
Freelander and Indigo Marina. (There are rumours of a metallic blue Ferrari
California and a Maserati also finding their way into his collection.)
"Unfortunately, I do not get enough time to drive. Sunday is when I take my cars
out. The cars that I really like, I tend not to let my chauffeur drive," he said
to an auto magazine almost a decade ago.
Now he'll have time to spend with his cars, as well as his other mechanical
passion, planes. Like his predecessor and uncle JRD Tata, Ratan is an
accomplished pilot and flies both planes and helicopters.
He made his first solo flight at 17 and enjoys piloting his Falcon 2000. He has
also flown the F-16 and F/A-18 fighters, getting into their cockpits at the Aero
India 2007 show.
"I've got a type rating [a licence that allows the holder to fly specific
aircraft] for the Falcon business jet, but lately I've been getting more into
flying helicopters. I love the engineering in them and they're challenging to
fly well," he says.
There's also likely to be more time for swimming and golf, post 2012. Tata used
to scuba dive regularly, but punctured his eardrums "too many times". He's had
to give that up, but still swims "a lot".
Ratan Tata grew up in the lap of luxury -- in the south Mumbai mansion that now
houses Deutsche Bank, driven to school in a Rolls Royce.
All that was forgotten in the decade he spent in the US studying architecture at
Cornell, taking on odd jobs -- including washing dishes -- to supplement the
pittance that the Reserve Bank of India allowed as foreign exchange allowance.
Returning to India and joining the Tata Group didn't mean any substantial
improvement in his standard of living. Ratan's first jobs were on the Tata Steel
shop floor in Jamshedpur, where he is believed to have done all manner of tasks,
including shovelling coal into the furnace. Which is perhaps why he retains the
common touch, and focusses on innovations that will make the lives of ordinary
Although Ratan Tata will retire in 2012, he will continue to be associated
closely with the Tata Group -- nearly 60% of the group holding company is
controlled by two charitable trusts, the Sir Dorabji Trust and the Sir Ratan
Tata Trust. Tata heads both.
That will mean that not only will he get the chance to sit in the audience
during group company AGMs and ask questions (as he said he'd like to do), he
will also be able to carry on the Tata family tradition of philanthropy.
"The Tata Group is associated with many charitable activities. It is logical
that Tata will increase his involvement in that work," says an insider.
Tata may also spend a lot of time working with educational and business
organisations with which he is associated. Clearly, Ratan Tata will be a busy
man even after moving out of the hot seat.