Niira Radia’s steep rise was fuelled by her association with the Tatas. Her fall may be more precipitous, says Suveen K Sinha, as that link weakens.
The most crucial public relations battle of Niira Radia’s life, as she tries to repair her own reputation rather than a client’s, has brought her closer to her employees. Every other day, she writes to the 300-odd employees of Vaishnavi, her public relations and corporate affairs firm, addressing their concerns and telling them that all will be well. The other day, in a rare show of her innermost feelings, she wrote to her top people expressing deep angst over the turn of events.
Some of the employees, for their part, have come to feel for her, and wonder what she must be going through now that everyone she thought a friend has either disowned her in public or has said that they were, in animated conversations, merely stringing her along. Vaishnavi’s senior management takes heart from the fact that few youngsters have faced any pressure from their parents or family to quit. Some clients have sent concerned emails, but the firm believes it has done well enough to keep them, at least for now. What’s more, say the firm’s top shots, the two biggest organisations in corporate India, the firm’s crown-jewel clients, are standing by them.
That is where they may be wrong. As this piece is being written, the Tata group, which is the reason for Vaishnavi’s existence, is in the middle of an exercise to assess the damage to the group’s image and that of Chairman Ratan Tata, and to figure out the way ahead in managing media relations. Neither Radia nor anyone else in Vaishnavi is a part of this exercise.
In the firm’s days of pomp — and it was in pomp until just a few weeks ago when Open and Outlook magazines went public with the tapes of Radia’s recorded telephonic conversations with politicians, business groups and journalists — this would have been unthinkable. Radia entered the field of public relations in what would be, in cricketing parlance, a player scoring a double century and taking 10 wickets on debut.
Daughter of a Punjabi couple settled in Kenya, Radia came to India in 1994, set up base in South Delhi and let it be known that she was an aviation consultant. Soon, she wanted her own airline. She became close to at least one powerful politician and disciple of an influential religious guru. But her breakthrough came when Ratan Tata, whom she had come to know while working on the aborted Tata-Singapore International Airlines venture, decided to protect his group’s interests by outsourcing public relations. Indian Hotels, which runs the Taj chain, had just signed an agreement with the Department of Culture for the preservation of the Taj Mahal. Vaishnavi was formed initially to foster this brand association and went on to acquire the accounts of 14 Tata companies, a number that eventually grew to 90.
Gradually, non-Tata accounts came, among them ITC Foods, Punj Lloyd, Ascendas, Hindustan Construction Company, Haldia Petrochemicals, the Confederation of Indian Industry, JK Tyre, and Bennett, Coleman & Co. Subsidiaries were formed to handle some of them. Noesis Strategic Consulting was started in 2007 to handle strategic and business advisory assignments — bagging a contract to restructure the telecom licensing framework for the Sultanate of Oman. Vitcom Consulting, too, came into being. But the big one was Reliance Industries, which in 2008 led to the setting-up of NeUcom Consulting, a firm so exclusive that it has just the one client.
Meanwhile, Vaishnavi’s sway over Tata grew and grew, to the extent that it became the group’s alter ego. It no longer merely facilitated the group’s interactions with the media, it spoke on behalf of the group. When the battle of Singur was raging, it was Vaishnavi’s executives you met on the ground, not those of Tata Motors. The financial arrangements were, to say the least, cosy. Each Tata company signed annual contracts with Vaishnavi, with big ones like Tata Teleservices paying Rs 45 lakh a month. Technically, this contract was reviewed every October, but the renewal became an automatic process, without any competitive bid being called. As the sole access-provider to Tata and Mukesh Ambani, Radia’s legend grew, until the tapes unspooled it.
Nine years since Vaishnavi was formed, the Tata Group is being forced to reconsider its twin strategy — outsourcing public relations as a non-core activity and letting one organisation manage PR for several distinct and disparate companies. The top executives of the group appear to believe that Radia, in holding the conversations in the tapes, may have exceeded her brief.
As a fallout of the tapes, one widely- read political column has taken a break, and a popular television anchor came off poorly in a live inquisition. But as yet there has been no real sacrifice of the kind controversies of this nature usually consume. Going by the way the wind is blowing, don’t be surprised if the sacrifice is of the one whose activity was considered so non-core that it was outsourced.
