Cyrus Mistry: Here are key business decisions he took for Tata group

Cyrus was also seen as the natural heir to the Tata group as his billionaire father owns an 18.4 percent stake in Tata group, largest stake of any shareholder in the group.

Written by Kanishka Singh | New Delhi | Updated: October 25, 2016 11:54 am
cyrus pallonji mistry, cyrus mistry, cyrus mistry sacked, cyrus mistry tata chairman, tata sons, ratan tata, business news, latest news, india news Mistry holds a BE in Civil Engineering from the prestigious Imperial College in London. He followed it up with a M Sc in Management from London Business School and a Bachelor of Commerce from Mumbai University.. REUTERS/Vivek Prakash/File Photo

Cyrus Pallonji Mistry was removed from his position as chairman of the $100 billion conglomerate Tata group on Monday. Former spearhead Ratan J. Tata has been appointed as the interim chairman of the group and a selection committee has been formed to choose Mistry’s successor. The appointment committee has been accorded a time period of four months to complete the task as per the company’s article of association.

WATCH VIDEO: Cyrus Mistry’s Career Timeline

 

Mistry holds a BE in Civil Engineering from the prestigious Imperial College in London. He followed it up with a M Sc in Management from London Business School and a Bachelor of Commerce from Mumbai University.

Son of Pallonji Mistry, Cyrus served as the managing director of Shapoorji Pallonji Group from 1994-2011. During the same time he was involved with Tata group in various capacities till he was appointed as Deputy chairman of the group in 2011 and as chairman in 2012 as the successor of Ratan Tata.

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Cyrus was also seen as the natural heir to the Tata group as his billionaire father owns an 18.4 percent stake in Tata group, largest stake of any shareholder in the group.

Here are the key decisions Mistry took during his time at the Tata group at the helm:

According to Mistry himself, over the last three years, the operating cash flows of Tata group grew by over 30 percent CAGR. However, he reformed business practices in the group mandating the requirement for group companies to earn the right to be part of the portfolio and also earn “the right to grow”.

WATCH VIDEO: Cyrus Mistry Removed As Chairman of Tata Sons: Here’s What Happened

 

During the same period, the company’s gross debt increased by 2 per cent due to increased cash and capital expenditure from projects but at the same time the cash and equivalent assets grew at around 10 per cent. The net debt of the group also decreased by 3.3 per cent during the time, so Mistry’s tenure saw reduction in debt strain on the company.

He pruned several companies from the portfolio and even changed the structure of the company’s hospitality arm from owning properties to one managing properties across the globe. A huge 70 per cent of the group’s revenue comes from abroad. A majority of the group’s capital expenditure under Mistry has been abroad.

Grasping the need to expand the company’s digital signature in the industry, apart from having the hugely successful TCS, Mistry added the digital platform–CliQ- an ecommerce platform. He also added Tata iQ which is a big data company and is rapidly growing in the field of data analytics. Finally, the group added Tata Digital Health which expanded the group’s medical business forays into e-healthcare and telemedicine taking medical care beyond physical impediments. TCS doubled its profits during the time overshadowing all competitors.

In pruning measures, Mistry was also involved in prospective selling off of long products businesses like the ailing Tata Steel in Europe due to drop in demand and massive competition from cheap Chinese supply. Also during his time, Tata teleservices failed to come out of its negative networth.

After Mistry took the position, Tata Motors focused on passenger vehicles section aiming for two launches every year. This has in turn changed customer perception about the company and lifted Tata Motors’ sales.

The group under Mistry has also tried to expand its business in the defence manufacturing business with several key contracts in the pipeline. Material sciences has been a major fillip to their defence manufacturing business during this time.

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  1. K
    Karthikeyan
    Oct 26, 2016 at 5:33 am
    Yes rightly said by Jagan.. though we cannot compare with Great Human and leader , Mistry was in right path and positioned the group well on his own style, Business man style.. But there must be a reason for this action by Mr. TATA. . Let's hope for the best..
    Reply
    1. K
      Khushminder
      Oct 24, 2016 at 4:12 pm
      yes. Some thing is radically gone wrong. Mr Ratan Tata is not hungry for the Chairmanship of Tata and sons conglomerate.
      Reply
      1. F
        fuckislam
        Oct 25, 2016 at 8:59 am
        Good decision by Ratan Tata and his team,this was necessary as Cyrus lowered the growth rate of TATA. Cyrus was a harmful virus.
        Reply
        1. S
          Sasa
          Oct 24, 2016 at 4:44 pm
          Absolutely something would have gone wrong.lt;br/gt;1) why 'immediate effect' is something fishy.lt;br/gt;2) it's a great surprise that tataji need to come to the picture at this stage as chairmanship.lt;br/gt; That means it may be something serious ??? That is not know to outside world.lt;br/gt;3) Tataji can ONLY bring back the Tata glory lt;br/gt;4) sudden Exit of Cyrus Mistry .why sudden?? lt;br/gt;lt;br/gt;Lot of unknown questions has no answer as this closed door board meeting.lt;br/gt;lt;br/gt;Now days lot of surprises in corporate world.lt;br/gt;One thing is very clear that owner or real stakeholder like Infosys murthyj or Tata ji always Available.
          Reply
          1. B
            Bala Dutt
            Oct 25, 2016 at 4:42 pm
            RATAN TATA is the best person in the interest of TATA group, mistry is not at all competent, and good
            Reply
            1. D
              Dabur Natural
              Oct 25, 2016 at 3:53 am
              This is not Sudden Effect. This is result of 3 year performance. lt;br/gt;and Mr Govind. CEO is not an "on-roll" job. where company need to give such notice. lt;br/gt;It is a contract based ignment which can be terminated even after 2 hours.
              Reply
              1. J
                jeganathan
                Oct 25, 2016 at 5:28 pm
                Mystery of the missing Mistry:lt;br/gt;Mistry may have been doing the right thing by :lt;br/gt;1. keeping the over the hill "old guard" at baylt;br/gt;2. cut losses by disposing off badly managed companies lt;br/gt;3. reduce debts and bad investmentslt;br/gt;4. change the (in) famous lethargic work culture of the Tata companieslt;br/gt;5. being ertivelt;br/gt;lt;br/gt;Head honcho of the diversified group of companies such as Tatas, cannot be evaluated in a matter of mere 4 years
                Reply
                1. K
                  KAILASH
                  Oct 25, 2016 at 4:39 pm
                  No comparison between Sh. Ratan TATA and this kid Cyrus Mistry, who cant even take care of his tummy, comparing the 2 will be like comparing a Mountain with a sand dune. Cyrus Mistry is an incompetent man, his personality says it all, he was never able, and competent enough to be the chairman of the great TATA group, but it was a mistake which the Board of Directors did, I happy they rectified it soon by reinstating sh. Ratan Tata. Ratan Tata is a marvellous man, cant even think of comparing it with this cartoon.
                  Reply
                  1. R
                    rajkal
                    Oct 24, 2016 at 2:42 pm
                    Hai,lt;br/gt;lt;br/gt;Something serious is lurking behind the scene. Ratan Tata is not Stupid. Daal mei kuch kala hai.
                    Reply
                    1. G
                      Govind Dafada,
                      Oct 24, 2016 at 6:34 pm
                      Mere khyal se Bina notice k aise to koi nikal nahi shakta, High court me Cyrus Mistry jitega
                      Reply
                      1. S
                        srikant
                        Oct 27, 2016 at 7:12 am
                        Maistry has blown the hype that Tatalt;br/gt;Companies are ethical well governedlt;br/gt;blah blah.They seem to have plenty oflt;br/gt;SKELETONS in their cupboard.
                        Reply
                        1. P
                          PURUSHOTTAM
                          Oct 27, 2016 at 12:19 pm
                          Tatas sacked him uncermoniously. It seems that from now on, Dr. Swami's ghost will haunt them. It was a conflict between the old and the new generations. Mr. Mistry seems to have a view of hiving off the loss making enies that served as decorative white elephants. They ousted him in a way a casual laborer is laid off. He has come out with a vengeace citing some practices as malpractices and dirty management. It seems that Mr. Ratan Tata was pulling the strings from the background. Thet could have solved this amicably. Now the billion dollar empire has come down and the economy is going to suffer. Their hiring of the 2 lawyers of Congress whose record in corrupt practices is enviable, might back- fire.
                          Reply
                          1. D
                            David
                            Oct 24, 2016 at 2:35 pm
                            Tata management and higher up are in the old era where they were favored lot under the British Raj. Times have changed. A company today needs D and innovation. Tata lacks it. They sell so many hundreds of products. They excell in none. They need to come out of the inbred culture.
                            Reply
                            1. S
                              Sawan
                              Oct 24, 2016 at 2:56 pm
                              TCS, ahead of it's peers and the most profitable Indian company. Tata Motors the largest Commercial Vehicle manufacturer and leaders in diesel vehicles. Tata group hotels are the best not only in India but among the best in the world, Tata Chemicals, Tata tea are some of the largest and the best companies in the business, Tat Steel produces the best quality steel in India. The Tata b is not just a business it is a concept that represents India's rise as an industrial force unlike any of the other groups. It is not a Banya company like the Ambani or the Adani groups.
                              Reply
                              1. S
                                Srinivasan Thyagarajan
                                Oct 26, 2016 at 4:14 am
                                If Tatas hold less shares who should have the say?Are insutional investors expected to side with major share holder( not newly acquired shares) or not?
                                Reply
                                1. Y
                                  Yadubhanu
                                  Oct 26, 2016 at 8:07 am
                                  Two things my business Guru taught were 1. No one is inevitable ib an organization and 2. Anger is a luxury for a business man. I do not know why Tata was angry with Mistry.
                                  Reply
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