26th December 2008, ECONOMIC TIMES
In these days, when management graduates vie with each other to do ‘visioning’ jobs such as strategy rather than dirty their hands with ‘executional’ responsibilities such as operations, a page from history offers an exceptional lesson.
The Tata Group has had only five chairmen in the 140-odd years since its inception, which makes for an average tenure of 20 years for each person. Four of these extraordinary attracted immense admiration during their time and were recipients of much public adulation upon their death.
Founder Jamsetji Tata is renowned for his vision. The fourth chairman, JRD Tata, became the first, and as yet only, businessperson to be honoured with the Bharat Ratna. Less well-recognised are the second and third chairmen of the group, Sir Dorab Tata and Sir Nowroji Saklatwala. What kind of leaders were these two men and what part did they play in the evolution of the Tata organisation?
The year 2009 will mark the 150th birth anniversary of Sir Dorab, who succeeded his legendary father as the second chairman of the group in 1904 and went on to serve in the post for the next 28 years. Sir Nowroji took over as chairman following Sir Dorab’s death in 1932 and guided the group till 1938, when he passed away. These two men were illustrious implementers of a grand vision that came up against some of the toughest obstacles that businesses had to face between the war years.
Sir Dorab Tata
Born in 1859, Sir Dorab was put through the paces by his father. Lying on his deathbed in 1904, Jamsetji Tata implored his son to execute his dreams and, thus, multiply the group’s wealth for the benefit of the community. Did Sir Dorab succeed in the mission, for that was what it was in scale and substance? What was said of him after his death in Germany on 3 June, 1932?
The Times of London observed: “…it was by his work in carrying out his father’s conception of iron and steel manufacture on a large scale in India that Dorabji rendered the most conspicuous service to Indian development and, incidentally, to Allied victories in the Eastern theatres of war… Before leaving India in April, he executed a trust for the greater part of his properties to be devoted to philanthropic purposes… The value of this charitable endowment is estimated at more than 2,250,000 sterling pounds…”
The Nature of London, in an obituary dated 2 July, 1932, stated: “… Dorab Tata’s role was as executor rather than creator. The pioneering was done by his father, Jamsetjee (sic) Tata, who bent his adventurous talent to three great enterprises: the establishment of an Institute of Science to prepare Indians for the direction of modern large-scale industries; the construction of iron and steel works as an essential link in the economic cycle; and the harnessing of the prolific rainfall of the Western Ghats to electric power stations to relieve the dependence of Bombay on far-distant coalfields… Dorab Tata, with the active sympathy of his brother, the late Sir Ratan Tata, set himself the filial task of completing his father’s work…”
The Railway Gazette of London, in an obituary that appeared on 10 June, 1932, said: “… Near this spot now stands Jamshedpur (called after his father), a town of 70,000 inhabitants and containing great modern steel works. Principal amongst their output are steel rails and sections of all kinds, which during the war were of incalculable value to the Allies, enabling all eastern fronts to be supplied with large quantities of railway material…”
A prophetic article titled Training our competitors: Asia’s time is coming, appearing in the South Wales Daily Post, published from Swansea, on 4 June, 1932 had it thus: “… An age-old industrial problem is recalled by the death of Sir Dorabji Tata, the head of the Indian iron, steel and tinplate business, now in indirect competition with Welsh products for the Indian market… Was it wise for us to provide an indispensable aid in the commencement of a competitive industry in the Indian Empire? … We must take the warning in time that Asia can and will compete and that until the Asian masses are raised to a far more elaborate and expensive standard of life than now prevails, thus immensely extending the market for goods that exist today, Asiatic trade may cut deeply into our trade, in the fullness of time…”
In Sir Dorab’s birth centenary year in 1959, the Free Press Journal of Bombay stated: “There is more than sentiment in the enthusiasm with which the birth centenary of Sir Dorab Tata is being celebrated today… To call this scion of the Tata family a great giver is to sum him up too simply — for he had made of giving an inspiring art… His is ‘constructive philanthropy’ at its very best … the finest approximation we have to the creative utilisation of wealth such has been accepted as a creed by the Rockefellers, Fords and Carnegies… The light that Sir Dorab lit must shine on.”
From the standpoint of history, Sir Dorab Tata’s skills in implementing his father’s vision counts among the most valuable. As the Nature newspaper recalled, Sir Dorab described himself as ‘The Last of his House’ because of “the painful truth that with his passing an end came to a family which played a great part in the industrial renaissance of India.”
Sir Nowroji Saklatwala
Sir Nowroji, the son of Jamsetji Tata’s sister, had joined the business in 1899. He took over the reins from Sir Dorab, but died rather unexpectedly in France at the age of 63 after a mere six years as the chairman of the Tata group.
In the decade prior to his assumption of the leadership, the group had undertaken major expansions and entered new businesses. The frenetic activity and the Great Depression left Sir Nowroji with the role of consolidation. How did he handle the multiple challenges he faced?
In a speech to the Rotary Club of Bombay in December 1933, Sir Nowroji said: “… Between 1917 and 1921, the Firm launched no less than 11 joint stock companies with an aggregate capital of Rs 27 crore … with the companies already in existence the Firm controlled over 20 companies … those were the truly mad days, and perhaps the maddest feature was the supreme confidence of the public in Tatas, and, incidentally, the overconfidence of the Tatas in themselves… We now come to the present day. The Firm has in recent years continued the process of consolidation. It has come out of what I may call the ‘boom fever’ stronger, a little sadder, and certainly wiser! The position of the Firm today is that it has concentrated its resources and energy on the management and welfare of its concerns, which hold out the promise of permanent survival…”
After his untimely death, the journalist DF Karaka wrote of Sir Nowroji: “He was primarily a businessman. He had a sort of native talent for doing business … he believed in decentralising his power and of delegating to those under him in whom he had confidence … He knew every detail of whatever was under his charge, but he preferred not to interfere where interference was not necessary. He hated the idea of exercising authority. He preferred to be always one amongst equals…”
Every Tata chairman has dreamed big and, each in his own distinctive way, has executed his vision in a manner that makes it at once part of a grand continuum, a greater whole. All of these men have been driven by the passion to contribute to society and to improve the community. There’s a shining lesson for managers everywhere, always and forever.
R Gopalakrishnan is an executive director of Tata Sons, the holding company of the Tata group. The facts in this article have been culled from published material available at the Tata Central Archives, Pune.