Russi Mody: A man manager par excellence

Padma Bhushan Rustomji Homusji Mody, known to most as Russi Mody was a chairman and managing director of Tata Steel and a leading member of the Tata Group. Mody as per his name was a man of excellence, He joined Tata Steel as an office assistant. By the time he left, he had quadrupled the company’s production capacity and set the tone for India’s nascent human resources practice. Dedicated to him, Russi Mody Center for Excellence is a popular tourist attraction in Jamshedpur. It is a museum that is home to the memories of the events related to the growth of India’s first steel plant established by the Tata Group.

Early Days

Rustomji Homusji Mody, to give his full name, was born with a silver spoon in his mouth. His father, Sir Homy Mody was the governor of the Bombay Presidency and Uttar Pradesh and a member of the Indian Legislative Assembly. Young Russi was sent to Harrow School in London and Oxford’s Christ Church College for his studies. On his return, he joined TISCO as an office assistant on a salary of Rs 50 per month. But soaring ambitions and a fierce will to succeed took him right to the top of the company’s hierarchy.

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Mody joined Tata Steel in 1939 and he was promoted to the position of Director of Personnel in 1953. He took up the position of the Director of Raw Materials in 1965. In 1970, he was appointed as Director of Operations and became Joint Managing Director in 1972. e was the most generous Managing Director of Tata Steel Ltd. He started many rewards like giving AC Maruti Suzuki 800 to all Divisional Managers of Tata Steel. He never faced a Strike at the Tata Steel Plant.

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His soaring ambitions and a fierce will to succeed took him right to the top of the company’s hierarchy. Indeed, so successful was he in his leadership of the steel major that he, and many others, fancied him as J.R.D. Tata’s successor to head the vast Indian conglomerate. It wasn’t an unwarranted expectation since JRD thought so highly of him that in 1984 he resigned as chairman of TISCO just so that Mody could be anointed to that post.

Pillars of Tata Empire

Mody, along with others like Darbari Seth of Tata Chemicals and Ajit Kerkar at Indian Hotels, had emerged as the powerful satraps of the widely-dispersed Tata empire of the 1970s. Once Ratan Tata took over the group’s reins, these men who enjoyed a free hand under JRD, found their wings clipped. While most of them chose to walk away into the sunset, Mody was among those that resisted fiercely even though with the reforms of 1992 altering the fundamentals of Indian business, TISCO was increasingly being found wanting. It had become a lumbering giant with obsolete processes and gross overstaffing which made it vulnerable to competition.

India’s Best Man Manager

Mody moulded the company as per his vision and will. Its best could be seen in the quadrupling of its capacity over the years he was in charge, as well its just and humane industrial relations policies. If the first positioned the firm firmly as the country’s steel industry leader, the latter made TISCO a path setter in the nascent human resource field in corporate India. It also allowed the company to function smoothly without losing a single man day to the kind of strikes and bandhs that led to the haemorrhaging of business and industry in the country’s eastern states of West Bengal and Bihar. When in 1979, the Janata government under Morarji Desai threatened to nationalize TISCO using the 47% stake it had in the company, thousands of the company’s workers led by Mody took to the streets in protest.

Clowns on the Stage

In the twilight of his life, JRD Tata was keen to see the anointment of Ratan Tata as heir-apparent and goaded him to take over the mantle. A taciturn Ratan Tata was often seen rushing to Patna to meet the then chief minister Lalu Prasad Yadav to brief him about Tata’s plan. Curiously enough, Russi Mody appeared quite defiant though he was divested of his executive powers and elevated to the post of chairman of Tata steels. Mody defied the re-organisation in the management hierarchy by making himself present at Jamshedpur where he was adored like a god. Managing director JJ Irani was increasingly finding it tough to deal with the factionalism that plagued Tata’s flagship firm.

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After a brief period of uncertainty at Jamshedpur, Bombay House finally struck and in one fell swoop sacked Mody. The next day’s headlines screamed, “India’s best man-manager sacked”. the first press conference hosted by Ratan Tata and JJ Irani at Jamshedpur after Mody’s exit. Though the mood was quite sombre in TISCO’s headquarters, Tata and Irani put up a brave front. Though both eulogized Mody for his contribution in making Tata Steels a robust enterprise, they were equally emphatic in stating that Mody’s exit would have no adverse impact. A caustic Mody later compared that those who succeed him were “clowns on the stage”.

Patch Up

Ratan Tata and Mody did patch up in later years, history at Tata Steels proved that the change more often than not happens for the good. Even Mody later gave credit to his bête noire Ratan Tata and praised him effusively for making Tata Steel a more robust firm than ever. Mody was magnanimous enough to accept that Ratan Tata had been the right choice to head the group.

New Journey Awaits

After his exit from TISCO, Mody served briefly as chairman of Air India and Indian Airlines and He also tried his hand in politics, but without much success. In 1998, Mody contested the Lok Sabha election from the Jamshedpur constituency as an independent but lost to a BJP rival. However, he did get about two lakh votes. In 1989, he was awarded the nation’s third-highest civilian award Padma Bhushan 1989 for his exemplary contribution to the Indian industry. He also set up a trading house with Aditya Kashyap, his protégé whom he had backed to head the company after him but who lost out when Ratan Tata installed J.J. Irani as his replacement. Even this venture met with limited success and after Kashyap’s untimely death, it was wound up.

Fond of good food, and an able pianist, Mody maintained a lavish lifestyle in Kolkata after his retirement. But as years rolled by, he became lonely, lost his memory and power of speech, all banes of advancing age.

That really summed up the man. He was quick to please and equally quick to take offence. But that last didn’t linger too long. Clearly Mody without Tata Steel was a fish out of water. After his exit from Jamshedpur, he chose to settle in Calcutta, a city he loved because, as he told one journalist, “I can stop at a green light and go when the lights are red.”

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