The Greatest Company in the World The Story of Tata (Book by Peter Casey in 2014) Retold by DR T.H. CHOWDARY Director: Center for Telecom Management and Studies Chairman: Pragna Bharati (intellect India ) Former: Chairman & Managing Director Videsh Sanchar Nigam Limited & Information Technology Advisor, Government of Andhra Pradesh M: 98 490 6 7359 T: +91(40) 6667-1191(O) 2784-3121® F: +91 (40) 6667-1111 [email protected]Website: www.drthchowdary.net Talk @ TCS, Qcity: 8 th Jan 2015
Transcript
The Greatest Company in the WorldThe Story of Tata
(Book by Peter Casey in 2014)Retold by
DR T.H. CHOWDARYDirector: Center for Telecom Management and Studies
Chairman: Pragna Bharati (intellect India )Former: Chairman & Managing Director
Videsh Sanchar Nigam Limited &Information Technology Advisor, Government of Andhra Pradesh
• Create wealth by harnessing natural and human resources • Neither altruism nor misanthropy• Strive to build a prosperous, powerful and intellectual nation
(as Member of a Global family – Vasudhaiva Kutumbakam)• Tata companies fulfill these ideals most - Hence have come to be called
“ The Greatest Company In the World” the story is told by Peter Casey; An Irishman, Writer; Chairman of a Global Recruitment and Search Co Lives in Atlanta, (GA) USA
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Fascinating Facts
• Tata Sons was founded in 1868 ( Gandhiji was born in 1869 ) by Jamsetji Tata
• Tata Group employs half a million people• Controls assets valued at $ 77.7 bln (Rs.4,68,000 cr) • Revenues more than $ 100 bln (Rs. 6,00,000 cr)• Profits $6.23 bln (Rs. 37,380 cr)• Operates in over 50 countries, spread over all the
continents
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Tata by Numbers
• Two thirds of Tata companies are owned by philanthropic Trusts• Tata is one of the biggest charities in the world• Tata consists of more than 130 companies.• 32 are traded in stock exchanges in India • Two of the top 20 Indian companies in terms of market
capitalization are of Tata group –TCS and Tata Motors• The largest company in India measured by market cap is TCS• Tetly, a Tata company is the second largest tea producer in the
world • Tata steel is the 5th largest steel company in the world• Tata Power is India’s largest private sector power producer
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Jamsetji Tata (b.13 March 1839 d. 19 May 1904)
• From a priests family • Builder of India’s industries and intellectual power.
‘He was above all a patriotWho made no public speeches
To his mind, wealth and the industrywhich led to wealth,
were not ends in themselves,but means to an end,
the stimulation of the latentresources of the countryand its elevation in the
scale of nations.”-The Times of India
13 April 1912On the occasion of the unveiling of the Memorial Statue of J N Tata in Bombay
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Tata Companies (1)
• The first “Make in India” idea and practices man• Central India Spinning Weaving & Mfg co in 1, Jan
1877• Cotton Mills (Mumbai, Nagpur) in 1870s; Swadesi
Cotton Mills -1886• Steel Making (Sakchi) TISCO, Jamshedpur: also Rails,
Important Cos of Tata Group Net Profit/Loss (2013-14) (Rs. In Cr)
TCS
Tata Motors
Tata Steel
Titan
Tata Global
Voltas
Tata Coffee
Tata Chemicals
IHCL
Tata Power
19,164
13,991
3,595
741
481
245
104
808
590
33
THC_CTMS(Source: Eenadu daily, 28 Dec 2014) Profit Loss
Tata & Intellect India (1)
• Indian Institute of Science(IISc) - operational 1911• Jamsetji donated 14 buildings & 4 other properties in Bombay
in 1898 for establishment of an University dedicated to Science valued at Rs. 10 mln ($ 4.56 mln; then, $140 mln in 2012)
• Tata Institute of Fundamental Research (TIFR) 1944 – (spawned BARC, ISRO, ECIL) • Tat Institute of Social Sciences • Tata Memorial Center for cancer Research and Treatment• The National Center for Performing Arts • The national Institute of Advanced Studies
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Tata & Intellect India (2)
• Sir Dorabji Tata Center for Research in Tropical Diseases • The Lady Tata Memorial Trust (funds research in leukemia)• The Lady Meherbai D. Tata Education Trust (funds
advanced education for women)• Dorab Tata sent three runners to the Antwerp Olympics in
1930• Dorab Tata financed the Indian team in 1924 Paris
Olympics • Indian Hokey team to the 1928 Amsterdam Olympics was
sent by Dorab Tata . India won the gold.
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Tata Support for Education • Jamsetji’s first Trust- J N Tata Endowment in the Y 1892• This Trust has paid for the education in UK for 20% of Indian ICS officers• In the year 1898 he gifted half of his wealth to establish the Indian
Institute of Science in Bengaluru .This was opened in 1911 • This gift was inspired by Swami Vivekananda’s advice to Jamsetji when
they were together travelling to America ; Jamsetji to get technology to make steel from the US and Swami Vivekananda to address the Parliament of Religions. Vivekananda suggested to Jamsetji to grow technology within India instead of importing it from the USA.
• (Andrew Carnegie gave $ 1 mln in 1902) for a technical school in Pittsburg, USA which later developed into the famous Carnegie Mellon University.)
• Sir RatanTata (JRD) financed the first archeological excavation in Pataliputhra (Patna) where the Mauryan Throne Room of Asoka was discovered
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Tata Values (1)
• Servant – leaders (ethos: one who cares for others so that they can better care for themselves and perform with excellence)
Not employee-Manager
• What can we do for others Not
How can we make the most money • An insurance policy for every associate• Tax compliance –not avoidance A senior Tata Executive presented a tax saving scheme to JRD and concluded , “ it is not
illegal” JRD: “ Not illegal, yes; but is it right ?” the scheme was dropped. “The avoidance of tax may be lawful, but it is not yet a virtue. -Lord Denning• In 1895 at Empress Mills ( so named as the Mills commenced production on the day Queen
Victoria was installed as Empress of India) Jamsetji said, “consider the interests of shareholders as our own and the health and welfare of the employees the sure foundation of our prosperity…”
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Tata Values (2)
In Jamshedpur, the Tata town : • Sakchi was renamed as Jamshedpur by no less a person than
Lord Chelmsford, the Vice Roy and Governor General of India as a tribute to Jamsetji Tata
• Housing for all employees at nominal rent - pension schemes – free education and health and medical services – free transport between home and company
• Free electricity• Accident insurance• Employees resisted nationalisation of TISCO move by George
Fernandez the Industry Minister, himself a labour leader, in the Janata Government 1978
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JRD - The Greatest Indian (1)
(b.29 July 1904 d.29 Nov 1993)
• He was Chairman of the Tatas for 53 years • Joined Tatas in 1925 at age 21• He was a French citizen born to a French Mother in Paris and to
the Indian Father, a Tata. • He renounced French citizenship in 1929 and became the
youngest Chairman of Tatas at age 24 .• No college degree• As a French citizen he served in the French Army for an year• He became the India’s first licenced Air Pilot in 1929• In 1932 he founded the first commercial Indian Airlines- Tata Airlines by buying two second hand planes for Rs. 1 lakh
each.THC_CTMS 16S725_Jan2015
JRD - The Greatest Indian (2)
• India’s first commercial flight was in 1932 from Karachi to Bombay carrying mails for the Indian P&T - JRD was the Pilot.
• In 1946 Tata Air Lines went public and was renamed Air India Ltd.
• In 1948 he founded Air India International• Nehru Nationalised Air India in 1953• In 1978-79 the Janata government nationalised
Air India International but JRD was kept as Chairman of both the companies until 1978.
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JRD and Nehru on Population• JRD told Nehru in 1952 that planning and development can’t
remove poverty unless population is controlled. (far ahead of China’s Deng Xiao Ping since 1978) . Nehru scoffed and dismissed the idea.
• So we have dreadful unemployment and unemployability eg: certified but not qualified engineers, B.Techs, MBAs.
• We add 18 mln people a year. Never created more than 8mln jobs per year.
• JRD donated for and founded the International Institute of Population Studies.
• JRD received UN Population Award in 1992 ( Kailash Satyardhi gets a Nobel Prize for reducing child labour; not for reducing the production of jobless children)
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Tata Philanthropy: Distinct from U.S
• American Philanthropists built and ran their business first, for profit and only then after they made millions/ billions, did they begin thinking how to share their wealth
• Theirs was dog-eat-dog capitalism. Carnegie-Ruthless strike breaker
• Morgan-Monopolist• Rockefeller- The most hated and feared in American
Business• Bill gates- The most envied• For these philanthropy – After-thought • For Jamsetji – Driving Thought
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TCS - Jewel in the Tata Crown
• TCS was created in 1968• The first chief was Dr F C Kohli considered the “Father of the
Indian I.T”. He nurtured the company• Invigorated by S. Ramadorai• Boosted by N.Chandrasekaran• Had 20,000 Associates in 2000• Had 45,000 in 2005• Now has about 300,000 • Has the lowest (10.7%)employee turnover • Is the largest Indian I.T Com ( followed by Cognizant, Infosys,
Wipro & HCL)THC_CTMS 20S725_Jan2015
TCS - Revenues
• 2000 = $ 0.32 bln• 2003= $1 bln• 2009= $ 6 bln • 2013= $ 11 bln• 2015= $ 15 bln (Rs. 90,000 cr)• Only 7.6 % of TCS business is from India
