Lessons from the epic boardroom battle at Tata are already being taught at Indian business schools
It’s been just two weeks since Tata Sons, India’s largest conglomerate, fired its chairman Cyrus Mistry. But the corporate battle—one of the ugliest in India—is already on its way into MBA syllabi at the country’s top business schools.
The ouster of Mistry from the 148-year-old conglomerate is a classic example of management clashes over strategy, leadership styles, and corporate structure. Mistry was the company’s first chairman from outside the Tata family. Mistry alleges that right after his appointment in 2012, the board tweaked the company’s articles of association to limit the chairman’s power. Media reports speculate that the family was unhappy with some of the business decisions Mistry took. And when Ratan Tata, the patriarch of the Tata family, took over from Mistry as the interim chairman, it raised questions about whether he was too reluctant to cede control over the group, which had more than $100 billion in revenue last year.
In a country where 67% of all listed companies are family owned—and such businesses create around 65% of the GDP—the ongoing drama at Tata promises important lessons for the next generation of business leaders. Kavil Ramachandran, who runs a family enterprises program at the Indian School of Business, Hyderabad, told the Economic Times that the case study will be taught in classes about corporate governance, succession planning, and the handling of non-family CEOs. “Some of the current developments get embedded immediately in various courses. There will also be discussions of complete case studies in the future,” he said, while a professor at the Indian Institute of Management, Bangalore told the paper that the example of Tata will be used in teaching students about ownership and managerial rights, and how they differ across conglomerates and listed firms. (Tata Sons is the holding company for more than 100 separate firms, some of which are listed.) Full Story