The TATA Group
We are given to understand that the Tata Group is different from other Indian business entities on various parameters. We learn that the group is controlled by some philanthropic trusts. The profits earned by the group companies do not go to any individual or family rather it goes to the philanthropic trusts. We also know that many heads of the group are not direct descendants of its founder Jamsetji Tata and so it is not a family run business.
The talking point, Cyrus Mistry who happened to be the Group Chairman (lame duck?) for over four years is also connected to the Tata family just like previous Tata Group heads. So despite claims of philanthropic practices the community or family biases in the group are clearly visible. We learn that he was chosen by the trustees and then groomed by them for over a year.
So the simple question is if the selection was wrong and the grooming was improper, who should be made accountable?
Cyrus Mistry’s confession of being the “lame duck” Chairman is also very surprising. We are keen on knowing the date of his realization which we are sure would be much before the date of his removal.
We do not understand why a person of his stature continued despite being pushed to be a “lame duck” Chairman.
The story only confirms that the grip of the Tata Group is in the hands of Ratan Tata who is perhaps closer to the Tata heritage in comparison to Cyrus Mistry.
Hiring and Firing
We are sure, just like any other CEO, Cyrus Mistry is also an ardent advocate of the practice of “Hiring and Firing”. But the predicament he faced as the Tata Group Chairman is also faced by thousands of junior and middle level private sector company employees in India. We have no hesitation in saying that the private sector is no center of excellence and the HR practices do not ensure a fair deal. It is interesting to hear a senior Tata Group executive saying “performance is a subjective issue”.
Companies are run by a select group of people and their sycophants with the blessings of their owners or special power centers (like the trusts of the Tata Group). Unfortunately thousands of employees in Indian private sector are neither covered under things like “corporate governance” or labor laws.
It is unfortunate that we are not even ready to talk about it just because it is not as fashionable as the Cyrus Mistry episode.