russi mody 2

7/31/2019 Russi Mody 2

1/3

The founder of the Tata Iron & Steel Company - now called Tata Steel - never lived to see itincorporated. TISCO was born in 1907 - three years after Jamsetji Nusserwanji Tata died. Tatahad been pursuing the dream of setting up a steel plant in India since at least 1882. In 1902, heeven travelled to Pittsburgh to seek the help of American geologist and metallurgist Charles PagePerin. Within a decade of its birth, TISCO, the first Tata company to bear the family name, had

already made a mark: in June 1917, Perin would brag about TISCO at a meeting of Americanmining engineers, saying it produced pig iron for as little as $5 a tonne.

Tata Steel's history is inextricably linked to that of India,with the likes of Mahatma Gandhi and Subhas ChandraBose having intervened in its affairs at different times. Ithas made boardroom history, too - especially the bitterbattle between Russi Mody and Ratan Tata in the early1990s, for control of the company, which ended withMody's ouster.

There are quirky tales about the company as well. Thelegendary J.R.D. Tata, who later became group chairman, once recalled the saga of T.W.Tutwiler, general manager from 1916 to 1925. Tutwiler, he said, was "feared and loved as theuncrowned king of Jamshedpur... He thought that among his many accomplishments, he couldplay poker." The board would meet in Jamshedpur every Christmas, said Tata, mostly so that thedirectors could engage Tutwiler in a game of poker and dent his savings. The meetings stoppedafter Tutwiler left.

Life was probably easier for the directors then. Today, they are all on their toes, with Tata Steelhaving acquired factories and mines around the world. Their gambles now are business gambles,where the stakes are much higher. With the addition of Tata Steel Europe - formerly Corus - thecompany is the world's sixth-largest steel maker.

J.N. Tata

Established in 1907

1902: J.N. Tata seeks the help of geologist Charles Page Perin toidentify a site rich in resources such as iron and coal, to build India'sfirst steel plant. The search starts in what is now Madhya Pradesh

1907: The team finally chooses Sakchi village in present-dayJharkhand, which has since grown into the steel town of Jamshedpur

1908: The plant becomes operational

1920: Company introduces leave with pay. It became mandatory only in 1945

1928-29: Company introduces maternity benefit scheme

HISTORY LESSON1907 saw a split in the Congress atits Surat session, followinggrowing differences betweenmoderates and radicals. Themoderates retained control, but themovement was weakened


2/3

1934: Becomes the first company in the country to grant profit-sharing bonus

1938: After the deal J.R.D. Tata succeeds N.B. Saklatvala as Chairman of the company

Russi Mody

1984-85: Russi Mody takes over as new chairman. J.R.D. Tatabecomes Chairman Emeritus

1992: J.J. Irani becomes MD

Ratan Tata

1993: Russi Mody is ousted. Ratan Tata takesover

2005: Tata Steel acquires Singaporebased Nat Steel

Tata Steel wins the bid for European steelmaker Corus

2007: Tata Steel wins the bid for Europeansteel maker Corus. Ratan Tata after the deal

Tata Steel has come a long way from the 1950s, when it made more than 70 per cent of thecountry's steel and yet had to ration it out, partly because of the artificial shortages during thelicence raj. Because the industry was protected, there was little incentive to improve technology.The open-hearth process for making steel, which Indian companies all used, took eight hours ormore. But there was an alternative that took just 40 minutes. It involved injecting oxygen intomolten iron to purify it into steel.

One momentous morning in 1980, the company's top metallurgists, including J.J. Irani, whoretired as a non-executive director of Tata Steel in June 2011, met J.R.D. Tata in Mumbai, todiscuss the best way to inject oxygen. The top-blowing method did not allow the gas and moltenmetal to mix well, while the bottom injection method was a maintenance nightmare, as the heatoften damaged the vessel holding the iron.

A TISCO share certificate

Managing director Mody was not present. TridibeshMukherjee, who became deputy managing director in 2001,recalls in his epilogue to Tata Sons Director R.Gopalakrishnan's book The Case of the Bonsai Manager thatTata listened to the engineers for 45 minutes. Then he sentthem off to the centenary match between the MCC and

India, while he thought things over.


3/3

That afternoon, he declared that Tata Steel would go with the topblowing method, but keep itsoptions open on bottom injection, in case the technology improved in the future. As it happened,it did; a method was developed that combined both approaches. Thanks to Tata's prescience,adopting it was easy. "I learned that the leader has to go beyond technical knowledge, and theprocess of doing so is serious listening... and directed thinking," Mukherjee told Business Today.

A 1982 advertisementClick here to Enlarge

The company has seen its share of turbulence. V.G. Gopal,president of the Tata Workers' Union, was murdered on October14, 1993. The next day, J.R.D. Tata, who was in Geneva at thetime, sent a telegram to convey his condolences. This would bethe last written communication by Tata, who died less than sevenweeks later.

J.R.D. in front of J.N. Tata's statue inJamshedpur

"Good industrial relations are what got us

here," says current union president

Raghuram Pandey. "You have heard

Ratan Tata speak about Corus managers'

time consciousness. At Jamshedpur, we've never looked at our watches

when there was work to be completed." While Jamshedpur is a pillar

from the past, the future will be more complex. A new plant will come up

in Orissa, while Tata Steel Europe is set to cut 1,500 jobs.

Karl-Ulrich Koehler, CEO of Tata Steel Europe, told Business Today in December 2010: "A lotof goodwill has been generated internally... because of the parent's support to the European

operations through the downturn." This perception will be tested as things get tougher at home

and abroad.
http://businesstoday.intoday.in/story/tata-steel-history/1/16465.htmlhttp://businesstoday.intoday.in/story/tata-steel-history/1/16465.htmlhttp://businesstoday.intoday.in/story/tata-steel-history/1/16465.html

russi mody 2

Documents