'Technology is going to decide how businesses are run'
Ratan Tata, Chairman Emeritus of the Tata group, and Chairman, Tata Trusts, speaks about the economy and its drivers, technology and its disruptions, and the challenges confronting communities. Edited excerpts from an interview with Christabelle Noronha.
How do you see economic conditions in India and the wider world affecting the Tatas in the present and in the near future?
Narendra Modi has been offering a vision for a new India which will be free of corruption, a more open India in terms of making it easier to conduct business. I, for one, have been quite bullish about the success of what he has undertaken to do, and the voting pattern in recent elections have shown that what he is doing appeals to the layperson. I believe that India, if it continues down the road it is on, will see more growth and progress under the present government.
Different, and disparate, parts of the world have witnessed a swing towards conservatism in the recent past. Is this due to, as many argue, the lack of economic opportunities, rising income disparities and the like, or is there more to the phenomenon?
I can't answer that because I don't feel qualified to answer it. I would just say that there are segments of the population, and this is true of different countries, that have been ignored or taken for granted. There is a part of middle-income America and Europe that has been left behind and these people are voicing their disagreement with the existing or emerging order. There are imbalances and the increased disparity between new haves and have-nots is further fuelling unrest and instability. Many governments are not in a position to deal with such situations.
How can the market and market forces be made more empathetic towards the poor and marginalised? Is there a need to do this?
I think that's where the growth is coming from; that's where you hope to see prosperity appear. Take India's billion-plus people. We used to talk about 300-400 million people as being the consuming community. Today, with smartphones and their wider capability, you are touching close to 800 million consumers. Many of these consumers are not wealthy but companies are reaching them nevertheless, because it expands their market. Catering merely to the elite is not the way a country can be made prosperous. You have to consider the base of the pyramid and develop products and services for the less privileged.
As somebody who has always been a votary of technology, what do you make of the advances in automation, robotics and artificial intelligence that are disrupting business? How should enterprises, especially global enterprises such as Tata, be reacting?
I think technology is going to decide how businesses are run, and that's not a new phenomenon. We are many decades into information technology and the automation that it has enabled. Interestingly, artificial intelligence and analytics may replace the information technology tools of the past. We don't think much of it when we go to Google and ask a question and get immediate responses, sometimes before we finish asking the question. That kind of capability is going to becoming widespread, eliminating human inputs and impacting jobs. Tata companies in this space will need to reinvent themselves.
Are you apprehensive about the way technology is changing the very nature of human beings and their behaviour?
This has been happening for a while now, except that different skills were being created, or that different skills were being demanded of humans. Now we are going beyond human beings and building intelligence that can in some way replicate human thinking. Automation will surely become a big part of the running of businesses, even the making of business decisions of a limited nature.
I have a theory that everything moves in cycles. You go overboard one way and then self-correct. Most people operate that way, too, and design — in clothing, automobiles, architecture, etc. — illustrates how. You run with the changes and, soon enough, you are longing for what has been replaced. Our minds demand a sense of uniqueness. Human beings demand that we keep looking for change.
What are your hopes for and expectations of the Tata group as it continues to evolve and grow?
Simply put, the desire to be a good corporate citizen and to serve society and the communities you work with should be constant. That's the essential needed to create a standout company and a worthy legacy.
Life after retirement as chairman of Tata Sons was supposed to ease the load on you, but you appear to be busier than ever. What takes up your time now?
Part of it is about working with my colleagues to transform Tata Trusts. Also, I have started a small company to invest in startups, and then there are the outside commitments that I have, the boards and committees that I am on. All of these, put together, have kept me more than busy.