Posts Tagged ‘Industries’

Ratan Tata, the proud chairman of the salt-to-software conglomerate is looking for someone who can fit well into his huge shoes.

India keenly awaits the succession of the $71 billion TATA Group. Ratan Tata will retire in December, 2012, when he turns 75. He is the chairman of Tata Sons, the group’s holding company and non-executive chairman of group companies like Tata Steel, Tata Motors and Tata Consultancy Services.

This hunt for the successor ought to be on the priority list of Mr. Tata as he may not wish the future Chairman to face the challenges that he did when he took over after his uncle JRD Tata in 1991. “The process of succession planning is much more dignified than at the time of JRD Tata,” said Gita Piramal, management writer and author of Business Maharajas. “Nobody knew JRD’s mind. There seems to be an inclusive exercise going on as Ratan Tata is consulting within and outside to find the successor.”

The board of Tata Sons has formed a panel of five wise men to find out who should be the successor to Mr. Ratan Tata. The decision is certainly very complex given the size of the Tata Empire. The selection committee comprises of Tata Sons vice chairman N.A. Soonawala, two other senior group directors RK Krishnakumar and Cyrus Mistry, group adviser and lawyer Shirin Bharucha and Lord Kumar Bhattacharya, a London-based management guru and Ratan Tata’s close friend. He is the committee’s external member. Ratan Tata will be the mentor of this panel.

While the panel has commenced working on the hunt, India has started its speculation on who can or who will fit into India’s most desired Corporate Vacancy. According to the people in the know and the criteria set by Tata, some of the desired requisites in the successor for the Tata Empire are that he/she has to have a thorough knowledge about the Tata Group. Also, the successor should be a generalist with excellent people management skills. Tata focuses on the Indian way of working that is relationship-oriented and not transaction-oriented. He/she should be good at decision making, communication, politics, and global economics along with having a clean track record that would instill respect.

The Namoleague Times speculates a strong contender for the race of the successor. Noel Tata (53) is the name that crops up, a natural heir with the family surname. The role clearly got bigger when in July, Noel was appointed managing director of Tata International, the global trading arm of the Tata group, triggering the doubts that he is being groomed to be the successor. Noel, the half brother of Mr. Ratan Tata resigned from the same position at Trent Retail Firm (which runs the Westside Stores), where he is still the Vice-Chairman. He was also appointed the non-executive chairman of Tata Investment Corp Ltd, a listed investment firm that has a substantial holding in Tata Group companies. He took over from NA Soonawala. What strengthens the argument for him is that he is the son-in-law of the biggest shareholder of Tata Sons, Pallonji Mistry, popularly known as the Phantom of the Bombay House. Noel has strong work experiences in Nestle, Lakme and Tomco in the past, and served Trent for 12 years as the MD.

The other names with global exposure that figure in the huge sweepstakes are Arun Sarin, former CEO of Vodafone, Indra Nooyi of Pepsi, Keki Dadiseth of Unilever, Carlos Ghosn of Renault and Citigroup’s Vikram Pandit. The debate continues as some believe that insiders have a better chance to pull-off. B Muthuraman, Vice-Chairman, Tata Steel; Ishaat Hussain, Finance Director, Tata Sons; R Gopalakrishnan, Executive Director, Tata Sons; S Ramadorai, Vice-Chairman, Tata Consultancy Services; and Ravi Kant, Vice-Chairman, Tata Motors are the names if one goes by the hear-say.

A very ingenious answer was given by Adil Irani, a stakeholder, to the succession riddle: “The last (letter) of Jahangir’s name (JRD Tata) was R, and the next chairman Ratan’s name began with R. Now, the last (letter) in Ratan’s name is N, so the next chairman’s name must begin with N. Thus it must be Noel”.

This curiosity is bound to be in the air till March, 2011, when the committee is supposed to come out with the name of one of the strongest contenders for the coveted post of the next chairman of the Tata Group.

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The benchmark that almost every aspiring small-time Indian businessman aims at is none other than the rags-to-riches tycoon Dhirubhai Ambani. Dhirubhai Ambani alias Dhirajlal Hirachand Ambani was born on December 28, 1932, at Chorwad, Gujarat, into a Modh family. He started his entrepreneurial career by selling ‘Bhajias’ to the visitors at the Mount Girnar on weekends to make extra money and give it to his mother.

Dhirubhai moved to Aden, Yemen at the age of 16 after he completed his matriculation. He started work as a petrol station attendant before taking up a clerical position for an oil company that was the sole distributor of Shell products there. He sought his fortune through such humble beginnings and rose to find India’s largest empire.

Dhirubhai was married to Kokilaben and had two sons, Anil & Mukesh and two daughters, Nina & Deepti. He returned to India in 1958 with Rs 50,000 and set up a textile trading company. Assisted by his sons, he rewrote India’s corporate history. The trading house Reliance Commercial Corporation was set up in a small room with one table and three chairs. It began by importing polyester yarn and exporting spices. Dhirubhai sensed an opportunity in textiles and set up his first unit in 1966 at Naroda near Ahmedabad. The textile brand that he established, Vimal, flourished and remains a household name in India today.

Over the time the business diversified into the core specialization of petrochemicals with additional interests in telecommunications, information technology, energy, power, retail, textiles, infrastructure services, capital markets, and logistics. Since then there was no looking back and Dhirubhai received several honors like Man of the Century, One of the Most Powerful people in Asia, first Indian to be listed by Forbes as the 138th Richest Person of the said year and many more. Dhirubhai was also praised for his key role in shaping India’s stock market culture by attracting hordes of retail investors to a market till then dominated by state-run financial institutions. From nothing, he generated billions of rupees in wealth for those who put their trust in his companies. His efforts helped create an ‘equity cult’ in the Indian capital market.

Success on such a gigantic scale inevitably excites jealousy and enmity. Dhirubhai was accused of acting unethically and of having manipulated the Government policies to suit his own business needs. But even those who question his business dealings, readily concede that Dhirubhai had a vision and unparalleled business acumen. The film ‘Guru’ by ace director Mani Ratnam is said to be inspired by the life and deeds of Dhirubhai Ambani.

Dhirubhai died on 6th July, 2002. Reliance after Dhirubhai saw many ups and downs. The two brothers, Anil and Mukesh Ambani claimed to have disputes and the Reliance Empire was split into two: Reliance Industries Ltd. (Mukesh Ambani) and Reliance Anil Dhirubhai Ambani Group (Anil Ambani).

Dhirubhai always followed these words: “Think big, think fast and think ahead. Ideas are no one’s monopoly. Our dreams have to be bigger. Our ambitions higher. Our commitment deeper. And our efforts greater. This is my dream for Reliance and for India.”

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