New Delhi: Cyrus Pallonji Mistry, 46, took over the reins of the $100 billion Tata Sons on December 28, 2012. Cyrus Mistry, the younger son of construction tycoon Pallonji Mistry and MD of Shapoorji Pallonji group, replaced Ratan Tata, who stepped down after turning 75. Mistry had joined the Tata group in 2006 as a director and has held non-executive positions on boards of several other Tata companies earlier.
This is the second time in the company's 143-year old history that a non-Tata is heading the group - Sir Nowroji Saklatwala had led the group between 1932 and 1938.
In August 2010, the group, which prides itself on being professionally run, had formed a selection committee that included Cyrus, to look for Ratan Tata's successor. The committee initially included Mistry himself (he recused himself subsequently) after considering 14 persons selected the single largest shareholder in Tata Sons as the inheritor.
The reports suggested others included Ratan Tata's half brother Noel, 54, who many thought was a shoo-in; former Vodafone CEO Arun Sarin, 57; PepsiCo CEO Indra Nooyi, 56; Operating Partner, Clayton Dubilier & Rice, LLC, Vindi Banga, 56; Citigroup CEO Vikram Pandit, 54; with even Google's Nikesh Arora, 43, seen as a dark horse.
"He is intelligent and qualified to take on the responsibility being offered and I will be committed to working with him over the next year to give him the exposure, the involvement and the operating experience to equip him to undertake the full responsibility of the group on my retirement," Ratan Tata had said about Misty's appointment.
Before his appointment as chairman designate of Tata Sons, Mistry was the managing director of construction giant Shapoorji Pallonji Group, the family's construction flagship since 1994, a responsibility he's shared with his older brother Shapoor. Mistry, a UK-trained civil engineer and London Business School grad, is also credited with taking Shapoorji Pallonji Group in to new heights, which now has over 23,000 employees and strong presence in India, besides Middle East and Africa. The Mistry family holds a valuable 18 per cent stake in Tata Sons and Cyrus's father Pallonji Mistry was board member for a long time.
In his current position, Mistry has focused on belt-tightening at a conglomerate left bloated by explosive growth under his predecessor. "Ratan was much more ... strategic, more over-arching. Mistry's much more focused. The CFOs as well as the business heads are going to find it a much more rigorous exercise," a director who sits on multiple Tata company boards had said.
In February(2013), at his first Tata Chemicals board meeting as group chairman, Mistry quietfully listened to the discussion of directors to find synergies between interests dotted around the globe, he politely but firmly outlined that further consolidation was the only way forward.
Under Ratan Tata tenure, the group saw explosive growth with revenue growing ten-fold to $100 billion in the year ended March 2012, fuelled by acquisitions including an ill-timed $13 billion deal for Anglo-Dutch steelmaker Corus and a more successful $2.3 billion purchase of luxury car brands Jaguar and Land Rover (JLR).
With one eye on profitability and the other on regeneration of value, RNT, as he is known in Bombay House, he has grown the group 13 times in the last 21 years. Quite notably, his career as the helmsman of the Tata Group has run parallel to the Indian reforms story. By strategically leveraging the intrinsic strength and value of TCS, Tata Steel and Tata Motors, he has metamorphosed his group by adopting a radical acquisitive strategy.
While Ratan Tata leaves the management of these companies to his chosen heir Cyrus Mistry, it is interesting to see how this generational change will raise the group to new heights.