‘Ours was, in a sense, the first Make-in-India effort’

Excerpts from an interview with

TV Narendran , Managing Director,

Tata Steel India and South East Asia:

What are the defining moments in Tata Steel’s history?

Even before we started, many critics wrote us off: the then Chief Commissioner of the Indian Railways, Sir Frederick Upcott, famously promised to eat every pound of steel rail that the Tatas produced! That was the kind of scepticism we dealt with. This was the first ‘Make in India’ effort, of sorts. The fact that nobody gave us a chance actually spurred our resolve.

The second significant period was in the 1920s, when we had many industrial problems in Jamshedpur, and Gandhiji sent a young leader, Subhas Chandra Bose. He spent eight years as a union leader in Tata Steel and played a role in brokering the union-management agreement of 1929. Ever since, Tata Steel has not seen a single strike.

The agreement was also significant because it led to a number of steps during the 1920s-40s that defined the Tata Steel culture. These included eight-hour workday, maternity leave and medical facilities for workers. Many of these were provided well before they became mandatory under law, and long before they were introduced in more developed countries. This period is the bedrock of the industrial relations culture of Tata Steel.

During the freedom struggle, much of the leadership was European and the prevalent feeling was that the locals weren’t getting the respect they deserved. This led to labour issues. Apart from the labour-friendly initiatives, the agreement catalysed a view that over time, we need to have local leadership. This led to Tata Steel having its first Indian General Manager, Jehangir Ghandy, at the Jamshedpur plant, about ten years later. It inspired the ‘Indianisation’ of the leadership.

What have been some of Tata Steel’s major technological innovations?

In the post-Independence era, growth was not really on the agenda; growth was, in a sense, ‘controlled’ by the government. In any case, it wasn’t as if demand was growing well in India. So, the initiatives were focussed on cost and process improvements. One of these, taken during the 1970s-90s, was stamp charging, a process change to help us use locally available coal better in coke-making. Then, coal-tar injection helped us cut costs. We were good at rebuilding entire blast furnaces and making them bigger. We got some of the biggest blast furnaces into India in the early 1990s. Tata Steel has always had a reputation for operational excellence. We’ve always been seen as one of the world’s lowest-cost producers of steel.

What were the company’s biggest challenges? How did it face them?

In the late 1970s, there was a move to nationalise Tata Steel. It posed a challenge to the company’s very existence; much to the government’s surprise, it was our workforce that resisted the move. Another big challenge came in the 1990s, when the steel industry was opened up.

There were two other challenges. The Jamshedpur plant is unique in that more than 10 million tonnes of steel are being produced on a 1,700-acre plot of land in the middle of a city. Setting up the plant and then expanding it over the years over such a small place has been a challenge. The second big challenge was the Kalinganagar plant in Odisha. Many have tried and failed, but we persisted and built a steel plant despite the challenges. It was commissioned about three months back and is already producing more than one lakh tonnes of steel. It’s probably one of India’s largest green-field projects.

What were your best growth years?

The golden era from a growth and profitability point of view would clearly be 2000 to 2010. This was when we had earned the right to grow and we grew in India. We also went overseas. In India, we moved from 3 million tonnes to 10 million tonnes now. In addition to volume growth, we enriched our product mix. Profitability was helped by the fact that those were the golden years for the commodity cycle.