Soft power

201chandra TCS chief Executive officer N. Chandrasekaran | REUTERS

CHAIRMAN, TATA SONS. Probably the most prestigious job in India's corporate landscape. But not necessarily the most coveted in the current circumstances. Uneasy indeed will lie the head that finally ends up wearing that crown.

One of the heads in the race, with his nose slightly ahead, is the CEO of Tata Group's crown jewel, TCS, India's oldest and biggest IT company. Natarajan Chandrasekaran, 53, has worn the crown at TCS comfortably and successfully. The company has shown an enviable growth under him, and no strong headwinds are expected. It is the second largest employer among listed companies in India, and ranks high among the most preferred companies to work for.

That Chandrasekaran would be considered for bigger responsibilities could be foreseen. So his induction to the Tata Sons board was no surprise. But the timing was—Ratan Tata signed his appointment a day after Cyrus Mistry was removed as chairman of Tata Sons and a committee was set up to find a replacement.

Mistry's sacking showed that Ratan Tata's support is vital for the holding company chairman to hold on to his chair and implement his vision. The nature of the Tata Sons holding makes it so. Tata Trusts, of which Ratan Tata is chairman, owns 66 per cent in Tata Sons. It is not that Tata Sons chairman cannot take independent decisions. But the voting power of Tata Trusts, meaning Ratan Tata's influence on the board, cannot be ignored, either.

Chandrasekaran has many things going for him. He is young and his leadership is acknowledged. He is well known within the group and has developed a good rapport at the senior-most level within the group. As a long-time Tata manager, he understands the culture and idiosyncrasies of the group's working. There has been nothing controversial about him or his decisions. Market expert Ambareesh Baliga said, being an insider, Chandrasekaran was the favourite for the post. “So far the new chairman has been from the family. Even Cyrus Mistry was family of sorts and that is why acceptance was easier,” he said.

Given TCS's international presence, Chandrasekaran understands the functioning of international markets. Software, his area of expertise, will govern all industrial activity in the future, and it requires nimble adaptation techniques coupled with an ability to anticipate the whats, hows and whys of future change. Every entity in Tata Group will need to adapt to that software challenge, for which Chandrasekaran is perhaps the best suited.

He is not known as a risk taker, or as one to overturn legacies overnight. He understands the significance of the Tata name to society at many levels, and would probably be better able to convince Tata Trusts that his vision is the right vision for the group.

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