Tata’s leadership challenge: Building the team around the Chairman

The Tata Group will need a strong chairman for its next chapter. But the larger leadership challenge will be to build the team around that chairman. A group spanning automobiles, technology, aviation, hospitality, consumer products, retail, power, infrastructure and financial services is now too large and diverse for all strategic coordination to depend on one office.

The next Tata structure may therefore need to look different from the traditional chairman-led model. It could require a strong chairman at the centre, supported by a handful of powerful business leaders, each responsible for facilitating coordination across a major cluster of businesses.

The chairman would provide overall direction, shape the vision, allocate capital and hold the Group together. The business chiefs would help translate that vision into execution across related companies.

Such a structure would, of course, have to preserve the authority of the boards and management teams of individual Tata companies, particularly listed entities with their own shareholders and governance responsibilities. The business chiefs would enable coordination rather than create another layer of operational control.

The objective would not be to weaken Tata Sons. It would be to make the centre more effective by building a stronger and more distributed leadership system beneath it.

Automotive Needs Its Own Leadership Centre
Automobiles will have to be one of the principal pillars of this new structure. Following its demerger, Tata’s automotive interests now span separately led passenger-vehicle and commercial-vehicle businesses, electric mobility and Jaguar Land Rover, giving the Group a presence across very different markets.

These businesses are too important and complex to be treated simply as components of a general industrial portfolio. They require leaders who understand both the Indian market and the global automotive opportunity.

Shailesh Chandra leads Tata Motors’ passenger-vehicle business, encompassing passenger vehicles, electric mobility and Jaguar Land Rover, while Girish Wagh leads the separately listed commercial-vehicle business following the Group’s automotive demerger.

The future opportunity may therefore lie not in placing these businesses under another operating layer, but in ensuring strategic coordination across passenger vehicles, commercial vehicles, JLR and related automotive capabilities while preserving their distinct leadership and accountability.

The larger ambition should be to make Tata a more integrated global mobility player across electric vehicles, software, connected mobility, commercial transportation and premium automobiles.

TCS Deserves To Be A Pillar In Its Own Right
The other business that cannot be left out of any new architecture is TCS. TCS is not merely Tata’s largest technology company. It is one of the principal sources of the Group’s financial strength and global reach. Its importance will only increase as artificial intelligence transforms the technology-services industry.

Krithivasan currently leads TCS, having taken over as CEO and Managing Director in 2023 after a long career within the company. A wider technology platform could encourage greater strategic coordination among TCS, Tata Electronics, Tata Communications, Tejas Networks, Tata Technologies and other technology-oriented businesses.

The aim would not be to merge them or compromise their independent governance. It would be to create greater coordination across software, artificial intelligence, electronics, communications, semiconductor manufacturing and digital infrastructure.

That could become one of the defining opportunities of the next Tata era: enabling greater collaboration between TCS and the Group’s newer businesses, wherever commercially appropriate and consistent with the governance responsibilities of the respective companies.

Such collaboration could allow the new businesses to benefit from TCS’s technology capabilities while giving TCS greater exposure to the next generation of opportunities emerging across the Group.

Consumer Could Become Another Major Platform
Sunil D’Souza is another leader who could potentially play a larger role in such an architecture. His experience across Hindustan Unilever, PepsiCo, Whirlpool and Tata Consumer Products gives him a breadth of consumer-sector experience that few Tata executives possess. He currently leads Tata Consumer Products.

A broader consumer platform could build on Tata Consumer’s existing portfolio, including Capital Foods and Organic India, its partnership through Tata Starbucks, and closer strategic links with other consumer-facing Tata businesses.

The objective would be to make consumer understanding, distribution, branding and innovation capabilities available more widely across the Group rather than requiring every company to build them independently.

The opportunity is not necessarily to combine companies. It is to share intelligence and capabilities across businesses that increasingly serve the same consumer.

Retail Should Have Its Own Captain
Retail is now too large and strategically important to be treated simply as an extension of consumer products. Trent has built powerful retail formats such as Westside and Zudio, while Croma has created a significant electronics-retail business. Tata’s digital consumer platforms add another dimension to this ecosystem.

Venkatesalu, the Managing Director of Trent, is already part of the Group’s senior leadership cohort.

A dedicated retail platform could bring Trent, Croma and other consumer-commerce businesses into closer strategic alignment, with a leader responsible for strengthening Tata’s capabilities across physical retail, digital commerce, supply chains, data and customer engagement.

Again, this would not require the operating companies to surrender their independence. The opportunity lies in creating common capabilities, sharing consumer insights and building a more connected Tata retail ecosystem.

Energy And Infrastructure Need A Larger Mandate
Praveer Sinha could potentially be at the centre of another major platform. His leadership of Tata Power gives him a strong base in India’s energy transition and makes him relevant to a broader discussion around power, renewable energy and infrastructure.

An energy and infrastructure platform could create closer strategic coordination among Tata Power and its renewable-energy businesses, Tata Projects, and selected real-estate and infrastructure companies.

The opportunity is enormous. India’s next decade will require massive investment in electricity, renewable energy, transmission, industrial infrastructure and urban development. Tata already has businesses across much of that value chain.

Better coordination could help these companies identify larger opportunities, approach complex projects with a wider set of capabilities and deploy capital more effectively.

Hospitality And Aviation Could Form An Experiences Platform
Puneet Chhatwal’s experience at Indian Hotels could make him an important voice in shaping greater coordination across Tata’s travel, hospitality and customer-experience businesses.

Tata has built a major hospitality enterprise through Indian Hotels and the Taj brand, while simultaneously embarking on an ambitious rebuilding of Air India. Creating stronger strategic links across aviation, hospitality, travel and selected destination-related businesses could produce a powerful experiences platform.

This would be less about placing different companies under one operating structure and more about encouraging common strategic thinking around travel, tourism, hospitality, loyalty, customer data and the overall consumer experience.

Indian Hotels and Air India have distinct operational realities and leadership requirements. But their customers increasingly move through a connected travel ecosystem. Tata has an opportunity to understand and serve that journey more cohesively.

Financial Services Need A Specialist Leader
Financial services should remain a distinct pillar rather than being absorbed into a broader portfolio. Tata Capital, insurance and asset management have different economics and regulatory requirements from the Group’s industrial and consumer businesses. Any effort to create greater scale and coordination across this ecosystem would therefore require specialist leadership and strong governance safeguards.

Rajiv Sabharwal, Managing Director and CEO of Tata Capital, is one obvious name to consider when thinking about such a structure. The objective would not be to blur the boundaries among differently regulated businesses. It would be to ensure that Tata’s financial-services capabilities develop with a common understanding of customers, technology, risk and long-term opportunity.

And Then There Is The Chairman
At the top of these businesses would need to be a chairman strong enough to bring different leaders together.

If T. V. Narendran is eventually chosen as Chairman of Tata Sons, his task would be much larger than overseeing individual companies. He would have to create a common vision for the Group and build a leadership team capable of executing it.

Narendran is currently regarded in reports as a strong internal contender, although the succession process is not final and other names remain under consideration.

This is where the distinction between a chairman and a super-CEO becomes important. The next chairman should not try to become the operating head of every Tata business. The role should be to determine where Tata wants to go, decide where its capital should go, identify the right leaders and ensure that those leaders work together.

The chairman must protect the Tata brand and uphold the Group’s values and governance standards. But the chairman must also create room for operating leaders to lead.

The New Tata Could Have Seven Or Eight Captains
The structure could evolve into something like this:

Tata Sons Chairman: Group strategy, capital allocation, governance, succession and stewardship of the Tata brand.
Automotive: Tata’s passenger-vehicle, commercial-vehicle, JLR and related mobility businesses.
Technology: TCS, Tata Electronics, Tata Communications, Tata Technologies and related technology businesses.
Consumer: Tata Consumer Products and associated consumer brands and partnerships.
Retail: Trent, Croma and the wider retail and consumer-commerce ecosystem.
Energy And Infrastructure: Tata Power, renewable energy, Tata Projects and related infrastructure businesses.
Hospitality And Aviation: Indian Hotels, Air India and related travel and experiences businesses.
Financial Services: Tata Capital, insurance and asset-management businesses.

These would not be eight independent Tatas. Nor should they become eight new layers of bureaucracy. They would be powerful strategic platforms working towards one Tata vision while respecting the boards, shareholders, regulatory responsibilities and operating leadership of the individual companies.

The Real Change Would Be A Distribution Of Leadership
This is where the next Tata structure could become genuinely different. For decades, the chairman has inevitably been the central figure through whom many of the Group’s most important strategic decisions have been coordinated. But as Tata has expanded into new industries and taken on much larger investments, the demands on that office have multiplied.

The answer cannot simply be to find a chairman capable of doing more. It may be to build a system in which fewer decisions need to reach the chairman in the first place.

That is what a genuine distribution of leadership would mean. Business leaders would have greater authority, but also greater accountability. They would be expected to think beyond their individual companies, share capabilities where appropriate and work with their counterparts across the Group.

The chairman would remain the captain. But the chairman would no longer need to steer every boat.

One Vision, Many Leaders
That may ultimately be the defining leadership challenge for Tata’s next decade.

The Group needs a strong centre, but it also needs strong businesses. It needs one vision, supported by different leaders capable of executing that vision across very different markets.

The success of the next chairman will therefore depend not merely on individual capability, but on the quality of the team built around the office. The next Tata should perhaps be judged not by whether one individual can control the Group, but by whether the organisation can create a team of leaders powerful enough to run its businesses, disciplined enough to work together and aligned enough to build one Tata for the next decade.

That would represent not a weaker Tata Sons, but a stronger and more distributed leadership system beneath it.

Dr. Annurag Batra is the Chairman & Editor-in-Chief of the BW Businessworld Group and the Founder & Editor-in-Chief of the exchange4media Group