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Jun 28, 2006, 02.43 PM IST | Source: Moneycontrol.com

Ratan Tata's many achievements

"If you move up the corporate ladder you expect people, particularly those near the top, to have thought through situations in terms of all implications."

"If you move up the corporate ladder you expect people, particularly those near the top, to have thought through situations in terms of all implications."

 

"The greater integration of the group has added an enormous strength to what we've done because we really were a disparate group of companies."

 

"You're the dog when you're doing badly. If Tata Motors is in a loss, we say, look the market shrunk but our market share didn't shrink. But nobody listens to you."

 

"When McKinsey was involved, it was very negative on steel. I've always held a view that steel provided a return that was beyond the cost of money."

 

"We're going to go after growth not just by expanding our existing products but by creating products that will reach out to the lower end of the pyramid."

 

"We are planning to grow our companies across the globe and will be looking for both organic and inorganic growth," says Tata.

 

"A company does not become global by simply participating in a certain number of geographic markets - in that sense, it is not a sum of parts. It is its ability to become globally competitive, leverage global opportunities and have the required global capabilities that makes it global. We are in the process of acquiring such a competitive position and global coordination capabilities, both at the individual company level, as well as at the group level," says Tata

 

 

Vital Statistics

 

Name                                       Ratan N Tata

Age in 2005                               68 years

Education                                 Bachelor's degree in architecture from USA's Cornell University

Mission/Vision                          "To improve the quality of life of the communities we serve"

Company                                  Tata Motors Limited, Tata Group

Designation                               Chairman

Tenure in current position            1 January 1991 to today

Tenure in company                     43 years: since 1962

Experience                               Joined the Tata Group in 1962 on returning from the USA. Initial assignment was at Tata Steel in Jamshedpur where he spent six years on the shop floor, first in the engineering division and finally in the projects division as technical assistant to the Director-in-Charge. Moving on to the group's textiles industries, he turned around Central India Textiles, and more importantly Nelco. He was appointed Chairman of Tata Industries in 1981, Deputy Chairman of Tata Motors in July 1988, and assumed JRD's position as Group Chairman in 1991

World class competency           Building world class companies and leaders, developing India's first car

Awards                                     Ernst & Young Entrepreneur of the Year,

                                                2003

Salary                                       Rs430,000

Google hits                                14,000

Number of employees                 NA

 

Company Performance FY02 - FY04

Revenues                      Rs132.23bn                RONW              24.19%

Net profit                       Rs8103.4mn              Growth rate        21% CAGR

Net profit margin            3.253%                      ROCE               26.21%

 

Smart Achievements

 

  • Globalization: made three international acquisitions, sourced new markets across three continents, developed products for international markets, put together a high speed data network linking three continents
  • Tata Motors bought South Korean truckmaker, Daewoo Commercial Vehicles for Rs4.65bn to establish a hold in East Asia, entered new markets in China, South Africa, Korea, Thailand and Britian, achieved 44% increase in net sales
  • Established presence on NYSE: Tata Motors listed its American Depositary Receipts on the New York Stock Exchange
  • Tata Steel bought Singapore's NatSteel for Rs13bn
  • VSNL acquired Dishnet for Rs2.7bn, and acquired TGN for $130mn including Tyco's extensive submarine cable network
  • Launched a highly successful IPO with TCS: the offer of 55.4bn shares was subscribed 7.7 times
  • Corporate restructuring: merged non-banking finance companies with Tata Motors to form a consolidated entity

Summary

 

On a balmy day in South Korea on 30 March 2004, in a quiet ceremony at the Daewoo Commercial Vehicle facility in Gunsan, Kwang-Ok Chae, President & Receiver of Daewoo CV, the second largest commercial vehicle maker in South Korea, handed over the newly allotted shares of his company to Ratan Tata. Not only was it Ratan Tata's first visit to Daewoo facilities but it was also Tata Motors' first overseas acquisition.

 

  • For Tata the Daewoo CV takeover was huge step forward in his eventual vision to firmly establish the Tata Group as a transnational. He plans to see that it is well on its way before he retires in three years. But Tata is clear about the challenges he faces. Tata Motors is one of the group companies that has already developed these capabilities. The strategy in this case has been through acquisition. 
  • Tata Motors is only one example. This sea change is happening across the group. For Tata, the dream of developing into a global giant had been brewing for many years, but it is only recently that the process really gained momentum. In the last few years, behind the stately facade of Bombay House, Tata has been busy pushing all group companies towards international growth. His strategy is simple; a mix of organic growth and takeovers. 
  • In 2004 in addition to Daewoo, Tata has made four bold steps. Tata Motors listed its American Depositary Receipts on the New York Stock Exchange; Tata Steel bought Singapore's NatSteel to target markets in China, Australia and Southeast Asia; VSNL put together a high speed data network linking three continents by agreeing to buy Tyco's extensive submarine cable network and by adding a link between Singapore and Chennai. And Tata Consultancy Services (TCS) went public with fanfare, cashing in on the global outsourcing boom.
  • Tata took over VSNL in 2002 with the express idea of leveraging its capacities and increasing the scale of the company. In the last three years, VSNL has grown by leaps and bounds by acquiring companies, starting new projects and creating synergies with other Tata companies. By 2003 work on a 3,175km undersea cable laying project (called Tata Indicom India Singapore System) between Chennai and Singapore, costing $100mn had commenced. 

The TCS IPO was another feather in Tata's cap. TCS is one of India's truly global companies with 800 foreign employees and a development center in every part of the world. TCS is one of India's largest software solution providers making over 90% of its revenues (Rs59.39bn in FY04) from its international clients. In 2003 it become the first Indian IT services organization to generate $1bn in a

 

 

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