Excerpt from Tata Log Feb 10,2013
Harish Bhat, Managing Director, Tata Global Beverages, discusses his book Tata Log, comprising eight stories about various Tata companies, withShweta Amit.
You are a regular columnist for Mint and now an author. What propelled you to write this book?
There are two things that propelled me to write this book, Firstly I have worked 25 years with the Tata Group and have been greatly inspired by many stories that I have seen of the Tata Group - some stories I have participated in and some that I have seen as a member of the Tata Group, but from outside its organisations.
So for instance, the Tanishq story I have been a part of. But other stories like Okhamandal or Tata Indica, I have seen from outside and admired greatly.
So I thought to myself that there are many inspiring stories from the Tata Group which have not really been told in a manner that reaches out to a large number of people.
As I said if these stories are written well, it can inspire many youngsters, young managers and entrepreneurs to change their dreams and achieve what the Tata Group has achieved over the last several years. That was the first drive to write this book.
The second reason is my passion for writing. If I were not a manager, I would be a writer. I love the written word and expressions and that's why I keep writing for newspapers and other publications. So writing this book came from the confidence of those two drives - the inspiring stories seen within the Tata Group and my passion for writing.
How different is it to author a book from writing a column?
Authoring a book requires you to live the book day in and day out. Writing a column is two to three hours of work. It's about structuring your thoughts on a specific topic and putting it down. Once you file your column, it's out of your way. And you don't think too much about it anymore. Writing a column is very limited in terms of the time and energy it demands.
Authoring a book requires a huge amount of intellectual energy and dedication. You have to be very clear about the theme of the book. Every story has to be researched very well so that it's authentic. The book itself has to show in a manner that it's very enjoyable to read. So both are different as say - you can prepare a small snack which will take you 10 minutes to prepare or you could prepare a five course Indian meal.
I would also think that in authoring a book it's important to bear in mind that it should be readable. Many books that are bought are not read completely. One of my objectives in writing this book was that not only should it be enjoyable and engaging but readers should be able to pick it up at an airport or a bookstore and in the course of a two to three hour flight they should be able to complete reading the book.
Also you cannot write a book when you are in midst of day-to-day operational work of a company as a manager. So I took a sabbatical from work for three months – April to June. I sat down and spent most of my time at the location where the various stories are based. I think these three months helped me authoring this one.
How different is this book from the clinical case studies one is accustomed to reading in several B-schools as a part of their curriculum?
I would call these case stories, which are different from case studies. A case study basically illustrates a particular facet of management. It's filled with data, statistics and events. It's written from a very rational point of view. It engages the head completely.
A case story of the 'Tata Log' kind contains on the other hand is meant to inspire. And you cannot inspire people with just facts, annexures, financial figures or tables. Inspiring people is about feeling of the head and heart. A great movie for instance appeals to both the head and the heart. It has a great story and also a lot of emotions in it. This book presents those stories in a manner that appeals to both the head and heart. The stories have a lot of rational fact to them and also a lot of emotion.
These are just not the stories of companies but of people within those companies, their dreams and ambitions, the failure they went through and how they recouped from those failures. So for instance if you read the story of Tata Indica, you will read the story of the designer of Indica. These stories are very rich in emotion and people, which typically you will not find in an IIM case study. The stories in 'Tata Log' appeal both to the left brain and right brain. Whereas a lot of these case studies found in the management institutes primarily appeal to the logical left brain.
When Tata Indica was first talked about being developed and launched, there was an element of cynicism in the response. How does one stick to their decision to go confidently ahead with the plan despite these unfavourable reactions?
If you look at page 48 in the book, there is a section there called the heart of courage which says, 'I often wonder: Where does such great courage come from? Does it come from deep within outstanding individuals and teams, as they pursue their passions and drams? Does it emerge from a very strong sense of duty to the country? Or does it simply come from fearlessness, which often lends itself generously to a noble purpose?'
If you look at Tata Indica, there were two things. First and foremost, as Ratan Tata has said he had utmost faith in Telco engineers. They were the ones who produced the Tata Safari and Sumo. He knew these were the engineers who created brilliant vehicles. That faith in the Tata Motors engineers was the source in confidently sticking to this decision to go ahead.
The second was a strong sense of duty to what was thought a big milestone step ahead for the country. And that the Tata Group has done right from the beginning.
Take for instance the Taj Mahal hotel in Mumbai. The Tata Group has always gone where no one else has ever gone before. And that strong pioneering urge which is always a sense of risk has been at the heart of the Tata Group in the last one and a half decades. This pioneering urge has made Tata go ahead and do things which no one has ever done before, even though there was a lot of cynicism.
Ratan Tata is quoted in my book as saying, ''It is important, particularly for the younger people in India, to believe in what we are doing and that we can do much more. They need to believe in and recognize the potential of their own capabilities.''
So you have to believe in yourself and be restless. That's what keeps a pioneer going. A pioneer always believes in oneself. When Christopher Columbus left the shores of Europe and sailed to find a new land, he believed in himself that he could do that. In a similar way, when Ratan Tata spoke of creating the Indica, he was speaking as a pioneer with a lot of belief in self, the company and the team. It was very inspiring and a pathbreaking moment for India. India was a country which had created a space craft, nuclear weapons and atomic bombs on its own but we did not have a car of our own which had been created in the country. So it was a milestone. Also for a country, a car is also its symbol.
It was overwhelming to read about your initiative at Okhamandal. You believe that you take a lot from the society so it's important to give back as well. How important is CSR according to you? Should this be an initiative taken by every corporate house as a purposive measure-one of the 4 Ps mentioned in your book?
I think every corporate house has a commitment to the community and it's very important because we live as a part of that community. And therefore when I speak about purposiveness as one of the Ps of the Tata Group in the book, purposiveness is about adding back to that community and country. Being driven by economic objectives alone, in my view makes an organization very narrow minded. An organization has to improve the quality of life in the community in which it's located.
And as Ratan Tata says, ''My view is that our expression of social responsibility cannot be measured in terms of profit or cost. It cannot be quantified in the language of sales or turnover. I would like to think this is the best of what Tata companies stand for.''
I think corporates are a very large part of countries and communities today. And therefore they have an important role to play in healing those wounds and doing the work and in making the communities they are a part of, much better places to live in.
Therefore to me, purposiveness is critical. Fortunately for us in the Tata Group, purposiveness has been a strong hallmark from the time the group was founded until today.
And The Whale Shark story in Okhamandal for instance demonstrates that. This was not going to add to the profits of Tata Chemicals but Tata Chemicals did it out of a sense of purpose because it believed that it was something critical and this was an endangered species which had to be saved. It was an important objective as it was a part of the eco system.
With regards to what happened with Tata Finance, how does one cope up with such unforeseen tribulations and ensure that the brand equity is not tarnished?
That's an important question and the reason why I have included Tata finance story in my book is to essentially make the point that no organisation is perfect. And I have actually said that the fourth P in my book as 'not perfect'. Since no organisation is perfect, we have to accept that there will be mistakes time to time.
Things will not always be one hundred per cent correct. There will be aberrations which happen. But it's very important that those aberrations should not be brushed under the carpet. They have to be addressed and dealt with and organisations have to do what is right to address those aberrations.
It was a huge loss because a fraud had been committed in the Tata Finance episode. There were two things which Tata Group did. The first thing it did was to reassure every investor and depositor that they will not lose a single penny. That was critical.
The second it did was to also pursue the culprits and brought them to justice. That also was not brushed under the carpet. And both these things were done very transparently and quickly. Perhaps one can say an error had occurred and the error should not have occurred in the first place. But that's the point I make about organisations not being perfect.
Sometimes as Indians we tend to put organisations and people on a pedestal. For us Mahatma Gandhi is perfect and he can do no wrong. For some other people, somebody else may be perfect. For many Indians, the Tata Group is a symbol of perfection.
Many people put their idols be it anyone, on a pedestal and tend to worship them. An organisation comprises of human beings. Human beings will be human beings and we all know nobody is perfect. And therefore errors will happen. However, responding to those errors in a very transparent, upright manner is what I think organisations need to do. The Tata Group responds to imperfections. They introspect and take the action required to deal with those imperfections.
That is why I have said that the Tata Group not being a perfect organisation, but deals with the imperfections while enhancing the other 3 Ps. You cannot let the imperfections take over the pioneering, purposive and principled factor. This has been the hallmark of our organisation.
The Tatas are known for their principled stance - another of the 4 Ps mentioned in your book. How does one retain success and at the same time not compromise on principles and ethics? Do you think Business and ethics go hand in hand?
It is truly very challenging in today's world. But I think the Tata Group over 150 years have demonstrated that it's possible to do business in a principled and ethical manner. What creates success for an organization? It is the pioneering spirit of creating a new brand that creates success.
Moving into a new product category and putting in place a new strategy to win over consumers creates success as you have seen from the Tanishq and Tetley example. Creating an innovative new product, whether it's the Tata Indica or Tata Swatch, creates success. So, creating success has so many factors to it.
In India we always tend to taint a large part of the country saying it is corrupt and there is a lot of corruption going around in India. But groups like the Tatas have shown that it is possible to create huge success by focussing on the pioneering and the purposive urge. Those are the urges that create wealth.
If you look at R M Lala's book, The Creation of Wealth, it talks about the creation of new businesses and products. It talks about a creation of a steel factory in the jungles of Eastern India, creation of a chemical unit in the semi-arid Okhamandal region of India and how Tata motors was created out of nothing at all.
According to me these are two very different dimensions. Creating success needs new thinking, new dimensions, vision and strategy and it is possible for all this to be done in a manner which is quite ethical provided you stick to those principles at all times and do not deviate - because even the slightest deviation often leads to a snowballing effect. That is something you should not tolerate if you wish to be a principled organisation.
Referring to the Tanishq episode, how difficult is it to win the trust or faith of the consumers? Do you think an aggressive marketing campaign and constant innovation in the jewellery sector plays a vital role?
In the jewellery market, there was a large segment of the jewellery industry which was taking women for a ride. The jewellers would say the jewellery was a 22 carat but it will actually provide lower than that. And they were therefore misusing the trust the family had in them. Typically the families had their own family jewellers. I am not saying all of them, but many jewellers were exploiting the trust.
Tanishq first and foremost said that when we say its 22 carats it will be 22 carats. Second they also introduced the carat meter on which the jewellery could actually be tested out. It was a scientific instrument and not available to consumers before that. So the trust came really from delivering to consumers what was promised. Tanishq has stuck to the platform of purity for so many years now, thereby reemphasising and re-establishing the trust with consumers.
Of course an aggressive marketing campaign is essential because you have to communicate this to the consumers. And constant innovation is essential because women don't buy jewellery just to keep it in their locker. Women also buy jewellery to wear it's a source of adornment for them. They like beautiful jewellery which makes them look and feel beautiful. Constant innovation in that case becomes critical and Tanishq did that and continues to do that.
To quote Desai, ''Tanishq must segment the jewellery market based on designs and price points. It must go back to the design concept as a differentiator. A work of art is known by its concept, and jewellery is such an expansive art form. Look at what Faberge did with a blooming egg!''
Therefore, constant innovation and designing plays a vital role as trust alone will not suffice.
The SCIP has benefitted many women who have restarted their career after a hiatus. How easy is it for them to get back to their second innings? Do you think that break for few years will come in the way of their career growth in the long run?
While writing that story I spoke to several women who have benefitted from SCIP (Second Career Internship Programme for Women). And I have highlighted two of those stories in my book.
When you take a break and try to come back, one of the things I sensed from each of the women I spoke to was the fact that they needed confidence to get back into their career, because the break for those few years will make them lose their confidence.
What the SCIP programme does is provide a good bridge back by providing a 6 month to one year project work. The programme gives them a good meaty senior role and assignment. When they work on it for a definite number of months, that confidence comes back.
In whatever career we are, be it sportspersons, film actors, if you don't do what you are good at for a long time, it certainly takes away your confidence. And when you get back to what you were doing, you need someone to hold your hand for a little bit of time so that the confidence builds back in you. That's what the SCIP does.
Many of the SCIP trainees have gone into senior roles in organisations now. Women today are playing senior roles in the industry despite having taken breaks in their career. I personally have known women who have come back after maternity breaks and moved up significantly in their career. I personally think it is a challenge.
If you look at the statistics quoted in my chapter, as far as women are concerned a lot of them drop out of the work force. Only 22 per cent of women graduates enter the workforce.
Out of that 22 per cent only 52 per cent of the junior levels make it to the middle level management. Many talented woman drop out of the work force and never return. If you look at directors in companies, in BSE index, out of 1112 directors only 59 are women. That is a big challenge here.
Though SCIP is a very good idea, I think the potential of the idea is much bigger than where it is performing today. The Tata organisation should be able to provide 1,000 assignments a year and not just 20 or 30. Then we can talk of it being a big success.
The Tatas were the first Indian company to venture out globally with the Tetley acquisition? Do you think that success was a turning point in making several acquisitions over the years?
Absolutely. I think the Tetley acquisition was a huge turning point for the Indian industry and Tata Group. For the first time, here was a Tata company, going out and acquiring a branded business. No Indian company had done that before.
Secondly it went out and acquired a business which was several times its size. No Indian company has done that either.
Thirdly it proved it was possible to successfully raise the funds and finance required for such an acquisition and do it in a manner which was secure, robust and prudent. So for all these reasons I do believe that the Tetley acquisition was a front runner. And it is the Tetley acquisition which has led to increased confidence as it was a path breaking venture. It created new opportunities for the Tata Group.
A key lesson that was learnt was that funding for such formidable acquisitions can be accomplished smartly and with manageable risk. It has clearly played an important role in setting the mind set for later acquisitions of the Tata Group such as Corus and JNR.
Now that the company is undergoing a change in leadership, is this an ode to Mr. Ratan Tata's retirement?
I would say that I was inspired by Ratan Tata and the Tata Group. In several stories of theTata Log, Ratan Tata's imprint is very clearly visible. If you look at the 4 Ps I have defined, I think the former chairman of the group has a very big role to play in retaining the pioneering impulse of the organisation, the purposive spirit and showing that the organisation is very principled and ensuring that it responds very rapidly to imperfections.
And I think all these stories demonstrate that the 4 Ps which I have called the Tata Way. That pathway was very well traversed under Ratan Tata's leadership. So it is an ode to Ratan Rata and I must say that over the last 25 years I have been greatly inspired by his leadership and by the manner in which he has led the Tata Group. He has been the icon of Indian industries and he has been an inspiration not for just many of us in the Tata Group but for India as a whole.
Since you have come back into an active corporate role, do we see another book coming from Harish Bhat in the near future?
You will certainly see another book coming from me. I cannot say how much in the near or far off future it is. As I have told you I am very passionate about writing and I am equally passionate about the corporate world, strategy, leadership, about the Tata Group.
I can also say quite frankly that writing a book is addictive. I love the process of developing a book. It's as close to giving birth to a child, because you create it out of nothing.
Now that I have gotten back into my role, I am focussed on my role as the managing director of Tata Global Beverages. But sometime in the future, when I do get the time and mind space I will address the task of writing another book.
