The 186th anniversary of Jamsetji Tata’s birth in Navsari would have been celebrated (March 3, 1839) by the time this article is published. I visited Navsari for the city’s celebration, visited his birth home, and launched the Gujarati version of my co-authored book, Jamsetji Tata.
It is forgotten that Tata was a startup at one time! Physics students understand torque as the extra power required to crank up a machine. For example, your body needs coffee or yoga when you wake up, or a cold car starts slowly for the daily run. Startups also require torque to reach a running mode before accelerating.
This torque phase of entrepreneurship is heavy-duty and frustrating, requiring tinges of luck. This phase brings a danger of early mortality. Torque demands tangible resources plus the untiring commitment of the founder(s), and one thing more—the overcoming of hurdles by competition, regulation, and administration. Tata faced them in the early years, like the government’s opposition to steel manufacturing or the Indian Institute of Science. They failed to set up a passenger car joint venture with Honda in the 80s, they failed their proposal to run airlines with Singapore Airlines in the 90s, and their attempted to manufacture Nano in Singur in the 2000s.
The logistics business is highly relevant nowadays, though shipping is less important now than a century ago. During the late 1800s, the pre-eminent shipping line was the British Peninsular & Orient Lines (P&O), which the colonial government heavily supported. Since P&O had a virtual monopoly, the firm charged exorbitant rates to Indian exporters. Jamsetji’s textile exports to Japan were affected, as were the export activities of other Indian and Jewish merchants from India.
Jamsetji would not accept this blatant exploitation, as his prolonged negotiation attempts failed. He went to Japan and finalised a joint venture with NYK (Nippon Yusen Kaisha), a successful Japanese shipping company. He chartered Annie Barrow, an English vessel, for his shipping company, the Tata Line. Jamsetji’s move was lauded by The Tribune in 1894 as “an effort worthy of general praise”.
P&O came down like a ton of bricks to throttle the new venture. They massively undercut freight prices to extinguish the early flickers of the Tata Line, causing the venture to suffer significant losses. Jamsetji’s pleas to the colonial government were ignored as their support for the British company increasingly became clearer. In despair, and contrary to other successful ventures, Jamsetji closed his Tata Line.
Vallinayagam Olaganathan Chidambaram Pillai (VOC for short) of Thoothukudi was a lawyer and politician, apart from being a businessman. He was deeply imbued with a nationalist feeling and joined the newly formed Indian National Congress. At that time, the sterling line, British India Steam Navigation Company, exploitatively dominated the shipping trade with Sri Lanka and the southern coastline.
Like Jamsetji tried in 1894, VOC launched the Swadeshi Steam Navigation Company in 1906. He was browbeaten into failure by the sterling company through tariff cuts and by even offering free rides to passengers on the colonial line. By 1908, he was arrested by the government, ostensibly for his political activities. Note how the misuse of standalone, independent agencies was resorted to even then! The oxygen in the lungs of SSNC ran out by 1911, and the firm was wound up. Interestingly, some months later, VOC was released from jail by the colonial government.
The entrepreneurial bug for shipping revived every 15 years—Jamsetji in 1894 and VOC in 1906. Another Indian shipping enterprise was floated in 1919 by a leader who was the pioneer and doyen of Indian shipping, Narottam Morarjee. He succeeded brilliantly, and his firm was dominant and prosperous well into the 1980s. Maybe his Kutchi DNA provided the torque, though the torque-DNA of both Jamsetji and VOC were also superlative. There must have been something different. What was that?
First, the business environment. By 1919, the colonial government was a slightly chastened force. Gandhiji had arrived in India, Indian soldiers fought for the British in World War I, the Chauri Chaura incident had happened in Bihar, Jallianwala Bagh had occurred, and early signs of a resurgent independence movement were all around. Even as Tata steadfastly pursued the dream of setting up a steel plant and institute of science against all objections, many entrepreneurs were suppressed.
But Narottam had a distinct strategy for his firm. He was a pioneer among shipping entrepreneurs who thought about talent. Young Indians had to be trained for shipping and leadership. Dufferin, India’s first training ship for Indians for a career at sea, was set up in November 1927.
Further, Narottam’s strategic insight was to treat shipping in an integrated manner. He combined talent, training, trading and shipping to support one another mutually. After several years, he even set up Scindia’s own shipbuilding yard. It was a fitting tribute to his sagacity and entrepreneurial torque that Indian Posts and Telegraphs issued a commemorative stamp on the centenary of his birth.
These case studies may be inspiring to upcoming entrepreneurs. The message is that entrepreneurial torque is essential, the environment and strategy matter greatly, and failure is not the last word.
(Views are personal)
(rgopal@themindworks.me)
R Gopalakrishnan | Author whose latest book, Jamsetji Tata: Powerful Learnings for Corporate Success, is co-authored with Harish Bhat