An eager crowd of graduating business students from the Tepper School, along with their family members, packed Carnegie Mellon’s McConomy auditorium for an exclusive and exciting start to the formal events of graduation weekend. The group gathered to hear Ratan Tata, one of the most accomplished international business leaders of the past two decades, for an hour and a half forum where he shared insights into the modern marketplace.
Tata stepped down just months ago as chairman of the holding company Tata Sons and of several major companies of the Tata Group, India’s largest conglomerate – a position he held for more than twenty years. He remains chairman emeritus and has taken the helm of the philanthropic Tata Trusts.
Under his leadership, the 145 year-old conglomerate grew from $5B in revenues to $100B and expanded its reach into 80 countries with 450,000 employees. Credited with the globalization and increased cohesion of the Tata companies, he is also a dedicated philanthropist, passionate about issues from improving children’s nutrition to water conservation. He has been honored with numerous awards, including an honorary doctorate of business practices this year from Carnegie Mellon University.
Flanked on stage by Tepper School Dean Robert Dammon, who also added insights to the conversation, and Varun Kumar, the Graduate Business Association president and moderator, Tata answered questions from the audience on a variety of timely issues.
Dean Dammon kicked off the afternoon with an introduction of Mr. Tata and recognition of CMU president Jared Cohon on his outstanding service to the university. He then opened the floor to students and their questions, on topics ranging from leadership to legacy. Tata, soft-spoken and candidly modest, engaged thoughtfully with the students.
As the Tata organization is highly regarded for prizing ethical conduct, the topic came up quickly.
“Most people don’t know that when we look at an acquisition, we spend a lot of time and energy in figuring whether the management culture of that organization is compatible with ours,” Tata observed. “We have quietly walked away from companies that would have been a good fit but where the culture would have been wrong.”
In response to questions on specific transactions, he relayed surprising lessons learned.
“We learned that we marketed the car wrongly,” he remarked of the Tata Nano automobile project. “We built an affordable transport for families, everything we proposed. We marketed it as the cheapest car but people didn’t want to be seen in the cheapest car. It should have been put out as the best value for the money.”
He went on to discuss his views on the U.S. auto industry, observing that while most companies were understandably cutting back after the financial crisis, that markets need the excitement of new products.
In examining the successful Jaguar-Land Rover acquisition from Ford Motor Co., he commented, “We were pleasantly surprised to see that Jaguar had enormous capability and talent. All we did was allow them to make their own destiny. We were there to support them.”
As topics broadened, Tata conveyed his views on India as an emerging market, describing it as a country with “enormous opportunity, a young population and enormous natural resource capability.” He noted a lack of infrastructure as one of India’s greatest shortfalls – something the country could not develop without outside investment.
He described the successful Tata conglomerate structure, unconsolidated and not wholly-owned, as somewhat different than those that “went out of fashion in the U.S. in the 70’s.” He noted the structure’s advantages and depicted his leadership style as one of “pulling the group of companies together.”
A self-effacing Tata demurred on the topic of his legacy, stating only, “What I hope I’ve left behind is a legacy of doing the right thing, being fair and just to all our stakeholders. We’ve tried to run the group with values and ethics. We could have done more but we would have compromised our standards. I just want to go home at night and hold my head high.”
In his current position, he hopes to have an impact for the vast numbers living with “inadequate resources.”
And to the graduates in particular, he advised, “If you do what you feel happiest doing you probably will do well. If you are unhappy with the environment, you will always be looking over your shoulder. So go into a business, not for money, but for the enjoyment and satisfaction of what you do. And hopefully,” he added, “with a sense of ethics and values.”
After thunderous applause, the event came to a close with the beaming soon-to-be graduates flooding onto the stage for a group photo with Tata, who wished them “all the very best and congratulations as you move into the world.”
Watch the Tata Forum Video
See photos on Flickr