The Soft Spoken Giant
Not much has been written about Cyrus Mistry’s leadership style. For a young 43-year-old, well- educated professional (from a wealthy family that held a significant, if minority stake in the Tata Group) to take charge as the Group Chairman, was no mean feat. And Mistry certainly was not a push over. He had studied civil engineering at Imperial College, London and acquired an MBA degree from the London Business School. He had been participating in his family’s business enterprise, which was largely concentrated on construction and infrastructure development.
Cyrus Mistry had entered his family business in 1991 as a director of Shapoorji Pallonji & Co. Ltd. In 1994, he assumed charge as the managing director of the group. Under his stewardship, the turnover of Shapoorji Pallonji's construction business grew from $20 million to nearly $1.5 billion. He led the diversification of the group from construction to design and large- scale and difficult projects across oil and gas, railways and the marine sector. It was around this time that the Shapoorji Pallonji's group acquired many large construction projects in Hyderabad, which were then the dream city development project of the then Chief Minister of Andhra Pradesh, Chandrababu Naidu. Many industry watchers attribute Mistry’s leadership style to have been “hands-on, fold-the-sleeves and get-to-business”. For Mistry had seen the downturn during the realty slowdown, and worked with his team to hold on to the sustainability of business and to scale it further.
*In the limelight
In 2006, when his father Pallonji retired, Mistry replaced him on the Tata Sons board and in a few other Tata Group companies. In 2012, he was selected by Tata Sons to chair the board. In the 144- year-legacy of the group, he was the sixth chairman, and only the second (after Nowroji Saklatwala) not to have the Tata surname.
As the group chairman, he quickly put together his team of experienced and younger (than their conventional senior group executives) professionals from different fields. On hindsight, one might think that he wanted to bring a freshness of ideas with relatively younger demographics across the Tata Group’s workforce, and to be relevant to the nation where its soft power was youth!
Not many may remember that one of his pet passion sectors was healthcare, and he had spoken many times about it. The group also started its health division as a long-term business opportunity. To be fair to his acumen, Mistry did deliver in smoothening out a lot of business struggles of the group in which he had inherited his chairmanship. The Tata Group’s telecom businesses were going nowhere. Its debt had piled up, and consumer offering was not up to the mark. The debt of the Tata group’s international acquisitions ‒ Jaguar Land Rover (JLR) and Corus Steel ‒ was worrisome without a solution or a hard decision in sight. Its steel business, power business and automobile businesses domestically were not doing well either. The group’s main cash generator was Tata Consultancy Services (TCS).
In such a scenario, as the chairman, he did take hard calls. He could divest only a small unit of Corus. He took a larger bet on JLR by infusing more investments into its growth. That bet paid off well. In the domestic automobile business, he effected a leadership hire, which proved to be one of the successful leadership decisions. The company developed a wider product portfolio, became relevant in the industry, and even started its electric vehicle (EV) plans, much before many in the sector did. He invested further in Tata Steel and also effected a leadership transition. These have worked out well. He had also strategised to bring all of the group’s consumer businesses into one entity ‒something that has been achieved by his successor. Many other restructuring measures were undertaken, including hiving off of companies to unlock their value and potential. Much of the robustness and structural changes needed by the group businesses to be relevant and financially strong, were begun during Mistry’s tenure.
As a business leader, one is never seen as standing for a popular vote. In this count, Mistry was a tall leader. He took decisions that have worked out. As a chairman, he was to steer decisions that could have long-term stability and good results for the stakeholders. Well, markets have cheered these decisions, as is reflected in the market capitalisation of Tata Group companies.
When Mistry was sacked in a clouded situation, no reason was given. For a group that was kind to people in general, this was shocking. While there were gossips and rumours floating fast, no official reason was available, till the court battles presented various theories of being wronged, etc. In short, the governance aspect of one of the tallest groups of India was seen in a different light, by different stakeholders.
The Firsts
Mistry was the first to formulate the role of the group brand custodian. For a group with such a rich legacy, he wanted to enshrine the Code of Values that the group stakeholders would stand by. He was also the first chairman to work on a formal code of corporate governance framework. This would have been a tall order, considering the way governance rules and regulations were evolving. The expectations from the group holdco in terms of probity, confidentiality, and sensitiveness of any data usage and sharing would have to be much above board. It would have had to be not just a tick mark approach but also in the true spirit.
Mistry seemed like a leader who knew that his task was a long term project, and not a daily duty. He wanted to transform the Tata group into a globally relevant player and be significant in the areas it served. Past laurels don’t matter when it comes to business. His task was to get the group to be financially stable, ready to be relevant to consumer play with emerging social changes, rather than simply rest on past glory. For goodwill earned is a trump card that can be used once or a few times. It needs to be repurposed too!
One of the legacies that younger Indians will remember from his career is to learn to fight for what they believe is fair for their self-respect and self-dignity. And importantly for those privileged youngsters, there is no substitute for hard work and humility. Mistry’s soft spoken nature was probably mistaken as submissiveness. Hence certain quarters may have been offended that he actually took steps to protect his reputation from being attacked. His family’s zealousness about protecting their privacy is legendary. His father Pallonji Mistry was known as the Phantom of Bombay House ‒ for he supposedly wielded influence but was never seen or heard in public.
Rest in peace, Cyrus Mistry. As the heir of that benevolent phantom, you too quietly built a legacy that will refuse to fade away. As for those proponents of governance standards that you espoused, time will reveal their efficacy. Corporate India still hasa lot to learn about its Holy Grails, and about possessing that spirit of ethics and governance, and not just keeping it on paper.
