Ratan asks team to focus on shareholders

The septuagenarian asked his core team to act as leaders in respective markets and to steer clear of comparisons to the past. He told them to keep a close eye on the competition and take steps to be in driver’s seat rather than learning by rote. Tata urged its top leaders to remain focused, “without being concerned about change in leadership.” Hinting at changes in the functioning of the companies, he referred to ongoing initiatives and said these will be evaluated and those required would continue to be undertaken. 

“If there is any change, they will be discussed with you,” he assured them. He had assumed the role of Interim-Chairman to lend “stability and continuity so that there is no vacuum.” Tata said this four-month arrangement (as per the Articles of Association of Tata Sons) would last till a new permanent leader was identified by a selection committee constituted by the Board. Other members of the committee are: TVS Motor head Venu Srinivasan, Amit Chandra of Bain Capital, former diplomat Ronen Sen and Advisor Lord Kumar Bhattacharyya. It is learnt from Bombay House that the “ouster was not sudden. 

According to a high-profile restructuring specialist based in Chennai, “When it comes to the Tatas, no one gets to know the real truth. Perhaps Cyrus had not applied his mind as managing such a conglomerate needs special acumen for decisions with wide ramifications. Health reasons could have been a factor that triggered the decision. It is surely not a commercial move. Why else would Ratan Tata intimate the PM on this decision?”

The news outbreak did not in any way reflect the lack of professionalism on part of Cyrus Mistry. Though a key personnel being sacked is out of the ordinary, it shows that Cyrus had “very strong conviction about his principles” but he could not “persuade” other Directors to his line of thought. “He could not dovetail to Tata’s vision… It is clear that he was not in tune with the expectations of the promoter group. Harmony is central to taking the whole Board along, and the House of Tatas should not be dragged into courts as that would send wrong signals the repercussions of which would be seen in the stock markets.