Aug 5, 2010

Ratan Tata and the search for Tata Group's new head



J. R. D. TataImage via Wikipedia
One of India's most legendary and respected business leaders, Ratan Tata of the Tata Group is slated to retire soon.

The hunt is already on for his successor - a selection committee has been constituted promising to evaluate candidates both internally as well as from outside.

However, the business publications are already predicting that the hunt is irrelevant - and that Noel Tata, Ratan Tata's half-brother is already tipped to be the next Chairman of the group.

When Ratan Tata took over as the group's Chaiman in the early 90s - he had to fill the large shoes of the legendary JRD Tata his uncle - as well as the heads of the group companies who were satraps of their businesses for decades - like Russi Mody, Ajit Kerkar and others.

People were worried that Ratan would not be able to live up to the expectations.

However, over the next two decades Ratan Tata took bold and decisive moves - removing the satraps, establishing a new branding that cuts across the group, high profile acquisitions in the Steel industry (Corus), Motors (Jaguar and Land Rover) and looked at India's growing middle class and customised products for them (Ginger in hotels and the famous Nano in motors)

Would an outsider have been able to do so much?

While we celebrate the meritocracy of professional leadership, I believe that being a member of the family gives the leader a moral authority and ownership to take big bets and to motivate employees that an "outside" candidate would never have managed. Tata himself was no ivory-tower leader - having joined Tata Steel on the shopfloor.

What do you think? Should the Tata Group look at hiring someone from out of the group for the Chairman?
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