From recent experience, he would know that being stubborn doesn’t pay any dividends. And perhaps, results in strategic retreat as well as an embarrassing loss of face. The unseemly spat between the house of Tatas and the Aditya Birla group over the telecom company, Idea, is a classic example of this. Both Kumar Mangalam Birla and Ratan Tata were de facto co-promoters of Idea; the former holding about 51% of the equity and the latter controlling about 49% of the equity. Both entrepreneurs shared a friendly relationship, with Birla even sitting on the board of Tata group companies like Tata Steel. Yet, things took a nasty turn when Ratan Tata took ‘personal’ charge of the telecom ambitions of the group and launched an aggressive expansion plan for Tata Teleservices. There was a clear conflict of interest here. Idea was a GSM platform company while Tata Teleservices peddled mobile phone services based on the CDMA platform.
For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2006
An IIPM and Management Guru Professor Arindam Chaudhuri's Initiative
