The new house that Tata built

Bombay House isn't exactly an imposing landmark. Yet, as you walk down Homi Mody Street in the busy Fort area, the corporate headquarters of the Tata Group stands tall amidst the noisy traffic and unending flow of pedestrians.

To industry veterans, the 87-year-old Bombay House still retains its old world charm. However, the last two decades have seen some of the most dramatic changes within this edifice, which have catapulted the Tata Group to the global league. The man at the helm of this transition retires in a little more than a year from now, but will leave behind a unique legacy.

BRICKBATS AND BOUQUETS

Ratan Tata didn't get such accolades when he first took charge of the Group in 1991. The sceptics didn't give him a ghost of a chance and insisted that the golden age of JRD Tata was over. When he started the clean-up act, where some members of the old guard were shown the door, there was indignation all around. “How can he possibly do this? This would have been unheard of in JRD's time,” was the general reaction then within industry circles.

All this while, Tata maintained a studious silence. From the media's point of view, he was an enigma. Interviews were hard to come by and his shyness was constantly misinterpreted as arrogance. It was somewhere around this time, in August 1998, that I met him at a conference where some other captains of industry were present. He was gracious and, to my surprise, asked me to call up his office the following day to fix a date for a meeting. It was a memorable affair, where I still remember him being completely affable and down to earth.

The conversation largely veered around the Group's new interest in cars. The Indica was the hottest topic at that time and was touted to be the biggest challenger to Maruti's supremacy in the compact segment. The crowds went wild when it was first unveiled at the '98 Auto Expo. Most of the other car pavilions were virtually empty as everyone had gone to take a look at this new Tata offering.

There was no question that the Indica marked a significant chapter for the Group, and the same sceptics who had questioned Mr Tata's abilities in '91 were gradually eating their words. A company which was better known for its trucks was now throwing down the gauntlet in the small car arena! To a lot of us then, the Indica was more than just a car — it made us feel proud of being Indians.

Of course, this was nothing compared to the hysteria unleashed years later with the Rs 1-lakh car, better known as the Nano. When Mr Tata first made it public that the Group was working on this project, the rest of the world stood up and took notice. This was an audacious move, something which no carmaker had ever attempted.

While some CEOs sneered, some others such as Mr Carlos Ghosn, CEO of Renault-Nissan, were all praise for this initiative. Suddenly, the term ‘frugal engineering' became fashionable in the automobile industry.

I had yet another opportunity to meet Mr Tata, in early 2006, to discuss this project which had caught the fancy of the world. The discussion gave me an insight into the mind of the man. “We should be bold and take some risks so that we can have a much larger scale of consumption of that product in India or elsewhere. We need to take a gamble on that, and that is my take on addressing that wider market,” he told me.

TINY CAR, BIG IMAGE

It was Mr Tata's view that there were big numbers to be had at the lower end of the passenger car spectrum. The confidence also stemmed from the fact that the Ace, a similar offering in the commercial vehicle space, was doing very well. Interestingly, the thinking then was that it would be a gearless car, which would assure easy driving.

There are no two ways regarding the fact that the Nano was the star of the 2008 Delhi Auto Expo. The venue was jam-packed hours in advance, with journalists from India and across the globe. The car had whipped up such a frenzy that nobody wanted to miss the action during the unveiling. The big moment came when Mr Tata announced the price with the now famous words, “A promise is a promise…” and the crowds just went wild.

The unveiling of the Nano was a proud day for Mr Tata, and it is a pity that it hasn't been able to live up to its potential yet. The global media has been relentless in its criticism, and it remains to be seen if the car will be able to stage a strong comeback. There is no question, though, that vendors associated with the project pushed the envelope in costing and innovation. This will hold them in good stead for the future, especially with the world going in for affordable and fuel-efficient cars.

Through his tenure, Mr Tata has focused on the Group going global, and the efforts have paid off, with nearly 60 per cent of revenues generated from beyond the geographies of India. Acquisitions have been part of this strategy, and some of them have been jaw-dropping numbers, as in the case of Corus, which involved a payout of nearly $12 billion, or Jaguar Land Rover at more than $2 billion.

And each time the critics went to town, especially during the global downturn when these buyouts seemed inane decisions, Mr Tata stood his ground.

Today, JLR is the best thing that could have happened to the group's car business and contributes to more than two-thirds of overall revenue. This holds true for some other overseas buys which are keeping the boat rock steady at a time when the West is wrapped in uncertainty.

“Ratan Tata is one of the most outstanding leaders of post-reform India. More than what he has done in the global arena, it is the way he has done it which makes him special,” a top CEO said.

It has been quite a facelift for Bombay House since the days of '91.

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