The Tata Group has begun the process of filling up vacancies at some of its key posts as the salt-to-software conglomerate girds up to meet the twin challenges of a slowdown in some areas and explosive growth and opportunities in other sectors.
People with direct knowledge of the matter said that an internationally reputed search firm has been mandated to hunt for an MD of Tata Motors. India’s largest truck and bus maker has been leaderless since the death of Karl Slym in January 2014.
DHR International, which is leading the search for the position, is supposed to possess expertise in identifying top talent for automobile companies.
Two internal candidates
The Indian partner of a global search firm has also been asked to shortlist candidates for the post of Tata Motors chief financial officer. The incumbent C Ramakrishnan is retiring in June this year and an announcement is expected to be made by July.
“We will announce the details for the new managing director and for the chief financial officer once we have made these appointments,” a Tata Motors spokesperson said in an emailed response. “We do not have any additional comments on these at present.” DHR International did not respond to an emailed questionnaire. The group is also considering internal candidates for the post of chief financial officer of Tata Sons, the group holding company. For nearly two decades, Ishaat Hussain was among the few financial whiz kids in the Tata Group having led the finance functions in both Tata Steel and Tata Sons.
But in 2012, he became the nonexecutive director at Tata Sons and the group has been examining various alternatives, including external candidates since then. A top executive of a leading Mumbai-based finance firm was tapped for the post but the talks were not successful.
A top official close to the situation said that two internal candidates have been shortlisted and a decision could be made soon. Praveen Kadle, the 54-year-old managing director of Tata Capital who was earlier the chief financial officer of Tata Motors, and Koushik Chatterjee, group executive director (finance and corporate) of Tata Steel are the candidates.
“These matters are internal to the company. As and when we have an announcement to make, we will inform you,” a Tata Sons spokesperson said in an emailed response. Both Kadle and Chatterjee, chartered accountants, had been with the group for more than two decades. Kadle was spotted by the group’s former chairman Ratan Tata in 1996 when he was directly involved with the sale of Tata’s stake to IBM in their joint venture. A year later, Ratan Tata picked him as the vice-president of Tata Motors and five years later he became the finance director and a board member. The group’s ambitions of setting up a bank sparked another change and Kadle was moved to head Tata Capital, the subsidiary of Tata Sons.
Chatterjee, who worked closely with Tata Sons Finance Director Ishaat Hussain as his executive assistant rose through the ranks in Tata Steel in the past decade. He was deeply involved with the acquisition of British steelmaker Corus and was instrumental in the financial restructuring of Tata Steel both in India and overseas.
“The role will be more strategic than operational and a trusted candidate will be needed,” says the managing director of a search firm. “Internal candidate works well for this role.” He cannot be quoted as his firm often works for the group.
Tata Motors, on the other hand, has a different problem. It needs a strong leader capable of rejuvenating the organisation to develop new products and take on competition from multinationals. “They have an excellent track record when it comes to getting talent for the auto sector,” said the head of a prominent search company about DHR.
Analysts say the company is being pulled down by lack of local demand and a leader can give the right direction. “A managing director is needed to direct the company but does not mean he can immediately change the performance,” says an auto analyst who has tracked the company for over a decade. “They are getting pulled down by domestic demand and a leader will help in making right decisions at the right time.”