Narasimhan Srinath is a man in a hurry. He walks and talks at a frenetic pace. And, perhaps most telling of all, he’s made the journey from rookie to CEO in a speedy 13 years. Not surprising, then, that despite his genial appearance, his average height, and his comfortably bulky build, the head of Tata Communications can be aggressive and intense.
We meet for lunch at Mumbai’s Taj Lands End. Sitting in the hotel’s Chinese restaurant, Ming Yang, it is fitting that we begin the tête-à-tête with Tata Communications’ recent acquisition of China Enterprise Communications (CEC). “We’ve been looking at China for a long time,” explains Srinath, “but it wasn’t easy. We needed to find a company small enough to buy into. But also one with the right kind of licences to operate where we wanted to.” CEC fit the bill, and a few months ago, Srinath’s company acquired a 50% stake in CEC for an unspecified amount. This will give it access to the Chinese broadband and data market.
All this fits in very nicely and logically with Tata Communications’ international strategy. “We have about 35-40 offices round the world,” says Srinath, “and my job is really to try and orchestrate the organization, like a conductor; put the pieces together— that’s what I do.”
The cable guy: Srinath saved the day for VSNL with a simple solution. (Illustration: Jayachandran/Mint)
Ask Srinath how it all began, and he has a fascinating story to tell, one that goes back to 2002. That was when VSNL, later rechristened Tata Communications, had just been bought by the Tatas from the government of India. The telecom company came relatively cash-rich, buoyed by years of earning on every international call made out of India. Little did the Tatas then realize how soon all that would change. Six months after the takeover, the government unexpectedly killed VSNL’s monopoly. Call rates plummeted from $2 (about Rs86) to 5 cents a minute.
“One line of business was collapsing on us and the challenge was to figure out which way to go,” says Srinath, whose entire career has been with the Tatas. The solution that the then 42-year old engineer-CEO came up with was amazingly simple. He began to buy cable—in bulk. The company bought thousands of kilometres worth of cheap submarine cables, from companies such as the American TGN Tyco and Teleglobe in Canada.
Today, after an international investment of more than a billion dollars, Tata Communications is one of the largest voice carriers in the world. With an annual wholesale voice business of 25 billion minutes, it is among the top 10 wholesale voice carriers globally, in the same league as Verizon and AT&T. Ownership of the round-the-world cables has also made it possible to grow in the data market, and from there to more specialized markets such as the enterprise value-added markets.
But recent financial results for the company have not been entirely positive. Srinath protests when I ask him about the decline in profits, from Rs468 crore last year to Rs304 crore this year. “I can make my numbers look good today. But I am always balancing multiple businesses. I’m investing for growth and profits in the future,” he says with convincing emphasis.
Under Srinath, the company has evolved from a pure voice player to a serious player in voice, data and enterprise businesses. Each of these, Srinath explains, has a different rate of growth. “The voice business doesn’t have very high growth rates but gives us the cash to fund other parts of our business. We have a data and mobile value-added services business which is high growth rate...and then we have businesses like Neotel (in South Africa) and broadband that are high growth businesses—which will start to give us returns in the next couple of years.”
Between sips of soup I venture to ask Srinath about the man who has been both his boss and mentor for many years—Tata group chairman Ratan Tata. Srinath deliberates silently. Then with the solemnity of issuing a press release, he intones: “From my standpoint, it’s been challenging to work with him and learn from his approach. That’s been incredible—I couldn’t have got that kind of experience anywhere else and that’s as much as I am willing to say.”
But even that experience would have been inadequate to deal with VSNL in the early days. For instance, how did he deal with the bureaucracy? “It wasn’t easy,” Srinath admits. “There was simply no atmosphere of empowerment. Typically, what people would write on a file would be: ‘This is what I think we should do but my boss may please give his opinion’. The file would go through 17 signatures on the way before it came to me. Then I’d have people who came saying, ‘I know I have the authority but I just wanted your opinion.’ I’d simply say: ‘Not going to get it. Back to you’.”
“We rewrote everything from scratch,” he continues, “right from goal-setting to assessment systems. And then a large chunk of people—almost a thousand—opted for voluntary retirement.”
Today, Tata Communications is a global operation with offices in Canada, the US, France, Germany and Japan. Srinath travels to these on energetic tour itineraries that keep him away for up to 20 days a month. I ask him how his wife Ingrid copes. “Well, she travels a lot as well, for her work,” replies Srinath.
Ingrid, who was Srinath’s batchmate at the Indian Institute of Management, Calcutta, holds a demanding job too. Years ago, she walked out on an advertising career to work with Child Relief and You (CRY). In 2004, she became its CEO. In May, she moved on as the secretary general of Civicus, a civil rights organization based in Johannesburg.
As we chat, the attentive waiters get Srinath an ashtray as he lights up for a quick smoke between courses. And then it’s time for the food. Cantonese Fried Rice, Pan Fried Noodles, vegetables in hot sauce and Mala Chicken with snow peas, red pepper, water chestnuts, baby corn and mushrooms. Quite a spread. “I love Chinese food,” remarks Srinath, “especially Indian Chinese.”
It is an unusual combination, this family of two, one dedicated to telecommunication, the other to children’s and civic rights. One common interest is a passion for gadgets by Apple Inc. Between them, the couple owns half-a-dozen iPods, a desktop, a notebook and a soon-to-be-acquired pair of iPhones.
His latest addiction though, he confesses, is Guitar Hero on his PS2 gaming system (“2 hours every night”).
And then there are books—a whole range of them, from rereading The Count of Monte Cristo to Jack London’s Sea Wolf. Srinath reads most of his books on his Sony eBook reader. “It’s awesome,” he declares, less CEO than teenage gizmo geek. “The problem is, I never read one book at a time; I read three. For me to carry that on a plane is tough. Plus, the reader comes with some nice features like the ability to change font size.”
Srinath says a bit more about the family: “We keep our work lives very separate. But there are things we do independently, and lots of things we do together.” Certainly Ingrid’s web browser home page would not be, as Srinath’s is, a Formula 1 racing site. “I like the technology of the sport. I’m interested in the music, the video; what’s happening in terms of high definition standards,” he says.
Appropriate, perhaps, for someone who is always revved up to go.
Born: 8 July 1962
Education: Mechanical engineering, IIT Madras; MBA, IIM Calcutta
CURRENT DESIGNATION: CEO and managing director, Tata Communications
Work Profile: Srinath joined the elite Tata Administration Service in 1986 and has been with the Tata group ever since. He has worked with Tata Honeywell, Tata Industries (as executive assistant to Ratan Tata), Tata IBM and Tata Teleservices.
Favourite Gadget: PS2
Favourite Restaurant: Smith and Wollensky
Favourite Vacation Spot: South Africa
Last Book Read: ‘The State of Africa: A History of 50 Years of Independence’, Martin Meredith
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