Spare a moment or two to marvel: a British labour union expressing a preference for an Indian takeover of an American-owned manufacturing unit! This is not just globalisation, but an acceptance of the interdependence of the world economy. It is also a signifier of the complex strands of thought that globalisation has given rise to, with labour, capital and entrepreneurship all becoming more comfortable with their intertwined roles in a way that no standard theory of capitalism (and certainly not communism) had dared to envision. Closer home, it is also a coming of age for Indian industry. Till now, the battle that companies based in India were waging was about summoning the resources and gumption to attempt global mergers and acquisitions (M&As). That phase has now passed, and the challenge now is to see these M&As succeed under management practices honed largely in India but relevant across the world.
Global relevance is the important part. The vote in favour of the Tata Group by the dominant labour unions of Jaguar and Land Rover in the UK is an endorsement of the company as a global rather than Indian player. This applies to the other contender for the takeover as well. At issue was whether the unions would like to be part of the Tata Group or Mahindra & Mahindra along with private equity firm One Equity Partners. Irrespective of which of the two eventually swings the reported $1.5 billion deal, it shows how Indian brands now have an acknowledged role on the world stage, even if the unions have a less expansive outlook. They said they were satisfied with the promise (made by both contenders) that there would be no job losses. Contrast this with the long negotiations that Tata executives had to hold with the labour unions of Corus in the run up to that $12.1 billion deal. Tata was a relatively unknown bidder back then, and given the takeover target?s status as an iconic British steelmaker, questions of its credentials were perhaps only to be expected. This time, likewise, the unions? decision will be an important input for Ford in selecting the bidder for its automobile plants that employ about 40,000 people. The difference now is that Tata, at least, is much better regarded even by workers. Might corporate attitudes to labour back home take a cue from this?
