Foucault, governing and knowledge: Everyday diplomacy in Tata Steel, 1907–1925

Abstract

How do managerial bureaucracies emerge? We consider this central question of Chandlerian business history by examining how Tata and Sons governed its steelmaking company TISCO, 1907–1925. Tata had no steelmaking knowledge and was reliant upon American expertise and personnel. This knowledge imbalance skewed power in favour of autocratic American steelmasters who wielded complete operational control. Unable to impose its will on TISCO, Tata was forced to govern through everyday diplomacy. Through everyday diplomacy, Tata introduced accounting routines to establish a hierarchy and render the American steelmasters accountable to the parent company. Every administrative and accounting process suggested by Tata’s diplomat, B.J. Padshah, was resisted by the American steelmasters as an erosion of their absolute power. We contribute to our understanding of how a uniquely Indian type of enterprise, the managing agency, governed their loosely coupled subsidiaries. We extend Foucault’s power/knowledge by introducing everyday diplomacy as the vehicle for establishing organisational discipline.