Mistry takes clear stance on his role in JLR and TCS

He made no 'material contributions' to the success of the two brands, Tata Sons had said

Taking a clear stance over his contribution to the success of TCS and JLR, Cyrus Mistry stated that he helped improve the cash conversion cycle in TCS besides dedicating a lot of time and efforts for JLR.

“One of the first items for Mistry on his joining the TCS board was to focus the management on reducing the gap between profits and cash. Chandrasekaran and his team responded splendidly, improving the cash conversion cycle from 49% in 2012 to 92% in 2015,” Mistry’s office said in a statement.

Mistry has also been closely associated with JLR, its strategy meetings and design reviews. Between 2012-16, Mistry spent over 120 days including 38 days on the JLR design review, 56 days on offsite strategy meetings, as well as market visits to dealers in China, the US, and India. The above does not include the time devoted to board and budget meetings, the statement added.

According to the statement, TCS’ $100 million-and-above clients increased from 8 in FY2011, to 37 in FY2016, while $50 million-and-above clients increased from 27 in FY2011, to 73 in FY2016.

Tata Sons, in a statement on November 10, 2016, had said that Mistry had made no ‘material contributions’ to the success of TCS and JLR.

The statement also goes on to clarify as to why Mistry’s office had to quote such data. “Ideally, a leader must not need to quote such data in defense. Yet, it is important to set the record straight since insinuations and leaks are being made explicitly to create an illusion that Mistry was a ‘hands off’ chairman and TCS/JLR were on ‘auto-pilot’ during his leadership.”

According to the statement from Mistry’s office, JLR grew to become a much stronger company under his tenure. “JLR strategy under Mistry’s chairmanship has been to achieve scale as well as minimise currency and supply chain risks by investing in new facilities. Its lack of scale required it to invest disproportionately, compared to the industry, in new technologies that will help meet the regulatory requirements and differentiate its products. This has been done without leveraging the balance sheet and retaining adequate liquidity,” the statement says. The result is a stronger company that will reward the shareholders more consistently in the future, the statement adds.