After Nowroji Sakatwala's death, the TATAs were left without a chairman. The group desperately needed a man to take up the task, and the 34-year-old JRD TATA was chosen in 1938. Little did everyone know, he was soon to take the TATAs to unprecedented heights.
JRD Tata was the son of Ratanji Tata, the uncle of Dorabji Tata and the one responsible for the successful TATA Steel. Ratanji was married to a French citizen, Suzanne or Sooni Briere. Due to this, he spent his childhood in France and even worked in the French army for a year. However, his mother passed away, and he soon left for India to work for his father and the TATA group in 1925. Thus began the meteoric rise of JRD, which led to the rise of numerous businesses.
Birth of Air India
JRD was very passionate about planes and flying. He even had the licence to operate a plane. Hence, Air India was his child, his passion project, and he wanted to see flying in the skies. With the help of a few friends in the aviation industry and government, he started the project under Tata Airlines, but it was later renamed Air India.JRD was now eager to spread his wings westwards. He wanted to start a Bombay–London service. He realised that India was positioned uniquely from a geographical perspective. Today, companies like Boeing talk of the geographical advantage of India, but JRD has sensed the opportunity to serve the regions around India, including the Far East, Australasia and China on one side and Europe and the Middle East on the other. After World War II and independence, India was under tremendous economic distress and could not afford to start its international airlines. Hence, TATAs started a sister company, Air India International. Air India came to be known for its service, class, and punctuality, which is a reflection of JRD himself.
However, Air India was to be snatched from the TATAs, which would begin Air India's downfall. Rafi Ahmed Kidwai, a politician back then, suggested an overnight postal service that the airline companies of India should start. However, they were not technically or financially viable, which made them resist the forced postal service led by JRD. The tensions rose, and a new bill was passed that merged all airline companies, including Air India, and nationalised them. Due to this, TATA lost Air India, leading to the financial downfall we continue to witness today.
Lakme
While JRD was busy fighting the battle of Air India, India struggled with the rising dollar and the high cost of imports. To tackle this, the government decided to curb some imported items, such as cosmetics, which ended up causing an uproar among women in India. Many reached out to Jawahal Nehru and Indira Gandhi to find a solution, which led to the government approaching the TATAs. JRD found it amusing that they were willing to offer him complete support to start a cosmetics brand while they were busy snatching Air India away from him.
Nonetheless, he considered and thus began Lakme. Lakme stands for Lakshmi, the goddess of wealth( Lakme is the appropriate French pronunciation of Lakshmi in France).
Lakme was the pioneer of cosmetics in India, created with the intention of reducing imports and saving dollars on purchases. It is a fascinating story and a humble start to the behemoth that it has become.
Lakme was sold to Unilever, and the profits were used to create Trent, which is shaping up to become one of the most successful consumer businesses with the launch of Zudio and Westside.
TATA motors
TATA Motors initially started as TELCO( Tata Engineering and Locomotive Company). It first began with the production of steam engines around the 1940s and was the first engineering company in India. Initially, they struggled due to their complete dependence on the British government. However, an opportunity arose when the giant Daimler Benz was looking for a partner in Asia, and TELCO stepped up. They soon ventured into truck manufacturing, and the 407 model was a huge success. JRD attributed much of its success to a man named Sumant Moolgaokar, the visionary behind TATA motors. JRD could not live to see TELCO become the Tata Motors that we know today; however, what it achieved during his tenure ensured the pillars were in place for the new Chairman, Ratan Tata, to take TATA Motors to new heights.
TCS
Tata Consultancy service is now the most profitable business in the TATA group and is one of the biggest wealth creators in India. To know the beginning of the business, we need to go back 60 years. During the 1960s, the economy wasn't doing well, and nationalisation nationalisation was the talk of the town. Meanwhile, TATAs struggled to maintain the data of all their companies. Due to this,
JRD put forth the idea of spending fifty lakhs on a data centre that would help manage everything. This data centre was headquartered in the Bombay House and was named Tata Computing Centre. With the rise of digitalisation, TCS was on the cusp of a hockey stick growth, but the socialist policies+nationalisation+emergency+fear of computers taking jobs away was curbing its potential. TCS, under Faqir Chand Kohli, decided to make a bold move by foraying into the US markets first. However, things started to change as they started getting customers, the first being IGIC. It was the beginning of business process outsourcing as we know it today. TCS worked for several banks in Switzerland and helped set up exchanges in Hong Kong and Taiwan. Finally, TCS rose to prominence when it had the opportunity to set up NSE, NSDL, and transition. They also took charge of figuring out the Y2K problem. TCS got listed in 2004 and never looked back since. It has been a tremendous success, which started with the humble beginnings of an in-house data centre.
JRD Tata was a visionary; I call him the Industrialist of the Century because of the number of businesses that TATAs created under his tenure, which are still some of the biggest. He started Titan Industries, Voltas, TATA Salt, and much more except for the ones named above. How many of these businesses are part of NIFTY 50 or Nifty 100 right now? Air India, for sure, would have been one if not for nationalisation. He is not known just for his businesses but also for his commitment to staying ethical and not mixing politics with business. He made TATA a brand that symbolised trust and provided the push the chairmen after him needed. This marks the end of the TATA saga and the end of TATAs pre-2000. Let me know which other business house you would like me to study at!
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