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Dhirajlal Hirachand Ambani, (Gujarati :) also known as Dhirubhai, (28 December 1932 6 July 2002) was an Indian rags-to-riches business tycoon who founded Reliance Industries in Mumbai with his cousin. Ambani took his company (Reliance) public in 1977, and by 2007 the combined fortune of the family (sons Anil and Mukesh) was 60 billion dollars, making the Ambani's the second richest family in the world, next to the Walton family. Dhirubhai has been one among the select Forbes billionaires and has also figured in the Sunday Times list of top 50 businessmen in Asia. Dhirubhai started off as a small time worker with Arab merchants in the 1950s and moved to Mumbai in 1958 to start his own business in spices. After making modest profits, he moved into textiles and opened his mill near Ahmedabad. Dhirubhai founded Reliance Industries in 1958. After that it was a saga of expansions and successes. Reliance's story as a company has been a 'bitter-sweet' saga in India. While on one hand it remains one of the biggest Indian conglomerates, on the other hand it is known to be a company evading taxes and being intransparen. It has presence in various sectors like petrochemicals, textiles and is involved in the production of crude oil and gas, polyester and polymer products. The company's refinery at Jamnagar accounts for over 25% of India's total refining capacity and their plant at Hazira is the biggest chemical complex in India. The company has further diversified into Telecom, Insurance and Internet Businesses, Power Sector and so on. The Reliance group with over 85,000 employees provides almost 5% of the Central Government's total revenue. In 1986 after a heart attack he handed over his empire to his two sons Anil and Mukesh.
Early life
Dhirubhai Ambani was born on 28 December 1932 at Kukaswada near Chorwad in the then princely states of Junagadh. (Now the state of Gujarat, India) to Hirachand Gordhandhas Ambani and Jamnabe in a Gujarati family of modest means. Hirachand
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Gordhandhas Ambani was a village school teacher with little income. Hirachand and Jamanaben had two daughters - Trilochanaben and Jasuben and three sons - Ramnikbhai, Dhirubhai and Natubhai. Dhirubhai was the second son. Dhirubhai was precocious and highly intelligent. He was also highly impatient of the oppressive grinding mill of the school classroom. He chose work which used his physical ability to the maximum rather than cramming school lessons. When Jamnaben once asked Dhirubhai and Ramnikbhai to help his father by earning money, he angrily replied "Why do you keep screaming for money? I will make heaps of money one day". During weekends, he began setting up onion/potato fries stall at village fairs and made extra money which he gave to his mother.
Life in Aden
When he was 16 years old, he moved to Aden, Yemen. He worked with A. Besse & Co. for a salary of Rs.300 (Present Day $6.64). Two years later, A. Besse & Co. became the distributors for Shell products, and Dhirubhai was promoted to manage the companys filling station at the port of Aden. He was married to Kokilaben and had 2 sons, Mukesh, Anil and two daughters, Nina Kothari, Deepti Salgaonkar. He also worked in Dubai for some time during his early years. During those days of him, the Yemini Rial was made of pure silver coins and was in much demand at the London Bullion Exchange. Young Dhirubhai bought the Rials melted them into pure silver and sold it to the bullion traders in London. During the latter part of his life, while talking to reporters, it is believed that he said The margins were small but it was money for jam. After three months, it was stopped. But I made a few lakhs. In short, I was a manipulator, a very good manipulator. But I dont believe in not taking opportunities.
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the concept of selling through showrooms for his brand Vimal to counter the resistance from the traditional markets which he copied from Bombay Dyeing. He always had the dynamism and confidence in future and was always ready to go against all odds. He always believed in himself. He has always believed that his first responsibility is towards his companys shareholders and he was also concerned in protecting their interests. He is also known as the stock market messiah. This is because when some Marwari clan were trying to bring down the price of his shares by short selling, he counter attacked them and in turn earned a hefty sum from them. He has always had a wide investor base and most of his subscriptions were oversubscribed. He has always been an innovator in the financial market. He innovated and reintroduced successfully concepts like partial convertible bonds, fully convertible bonds etc. He has been successful in manufacturing worldclass products. He always believed in Think big, think fast and think ahead. He has never had an ego problem and he knew how to get his work done from people. He was never ashamed to salaam anyone. Another incident that shows his vision as a leader is that when Reliances Patalganga Complex was damaged due to floods. Technical experts from Du Pont estimated hundred days to make the complex operational but Reliance had the complete complex operational in twenty-one days. This was possible because of Dhirubhais vision, his confidence, his dedication proper logistical planning and making available all resources. Dhirubhai has always believed in picking up the best talent. They have a motivated workforce. He only believes in providing leadership, vision and strategy. He thinks that he doesnt run his business but his business leaders do it.
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Dhirubhai is criticized for manipulating the government for his benefits. Apart from that he has paid zero tax on corporate earnings for several years due to the loopholes in the system. He was also involved in manipulating the L&T board to gain control. Apart from that he was heavily criticized for buying shares under dummy companies which never existed. But be it whatever Dhirubhai is one of the greatest leaders of India who has the zeal to achieve something big rather than just earning money and the obsession to build. He wants to work till his death. He was a man who always dreamed big. At a time when capacities were fragmented and small, Dhirubhai dared to dream big. Instead of setting up capacities that would cater to current demand, he set up the capacity and then set about creating the demand. He knew where latent demand existed and decided to supply it. He made no compromises on quality, insisting that his machinery must be state-of-the-art. As a true leader Dhirubhai had once said that, People think I have finally arrived but I think I have just begun. He was physically attractive, intelligent, convincing, task oriented & self motivated, lastly he was both high on IQ & EQ.
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petroleum and as an ambitious young man; he shifted from service to business. He was helped by Jamnadas in dealing with commodities like rice and sugar and returned to India in 1958.He starte d Reliance Commercial Corporation with a capital of Rs 15000 as a trading firm. It is very educative to note that as for an Arab Sheiks request even a consignment of Indian soil was sent to Aden to grow roses in the desert showing that Ambani had the knack to identify an opportunity and strike the iron when it is hot. Branching out to yarn trading, he started the first spanking new mill at Naroda as he foresaw synthetics as the fabric of the future which shows the visionary nature of the man in general. Dhirubhai registered Reliance Textile Industries with a paid up capital of 150000 as a power loom unit. This is where the backward integration concept first took roots and later became the central theme for all strategic planning in Reliance.
As a risk taker, Ambani raised Rs. 280000 to get into manufacturing in a project which was predicted to fail by great business stalwarts like Viren Shah. But, because of his advance anticipation of things to come, he made a profit of 1.3 million in the first year. By 1977, Dhirubhai went public and his profit reached Rs 43.3 million from the revenues of 700 million. To manage his exploding business, he took out talent from wherever available and jobs were offered more on showing initiative rather than on paper qualifications which became a classic Reliance management strategy. The best technological talent was poached from all his competitors to form the brains trust of Reliance. When Ambani bought machinery, he was always ahead of tomorrows and had commitment to quality by taking the finest technology the world could offer. The best example is that of acquiring DuPont technology for synthetic yarn from Delaware, US, the polyester process being first bought by him outside of United States. Dhirubhai entered domestic markets with an advertising blitz on par with Hindustan Lever when Reliance introduced ONLY VIMAL since he was very confident that the brand image was the most important in order to win the consumers confidence. Dhirubhai felt that marketing success was a function of three factors, namely, choosing the right product mix, identifying the market and establishing a viable distribution structure. When faced with resistance from traditional cloth marketers, Dhirubhai opened his own showrooms and appointed agents
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and offered franchises to his own shareholders. He also opened up non metro urban segments in smaller towns as a result of which by 1980, Reliance fabrics were available to twenty company owned retail outlets, 1000franchised outlets and more than twenty thousand regular retails stores. This was comparable in speed and numbers only to Italian Benetton and American Mc Donalds. Dhirubhai established a good rapport with his dealers by making his business with them risk free because he used to sayif you lose, come back to us, but if you make profits, they are all yours! Dhirubhais future gazing skill could be inferred from the fact that though India is a poor country, people will not mind paying a little more for synthetics provided they have a good quality and had a longer wear and tear. The Naroda mill transformed Dhirubhai from a simple yarn trader to a great mill owner on par with Mafatlals, Sarabhais etc. Dhirubhai spread out countries abroad through his Reliance synthetic textiles. His dynamism and confidence in the future made him reach a sales turnover of Rs 1 billion in just twelve years whereas Bombay Dyeing needed hundred years. Dhirubhai was accused of black marketing and corruption to improve his sales and get things done. After 1977, when Reliance went public, Dhirubhais holdings were 16% but he had thousands of share holders from the public to support him in all his endeavors. By converting debt into equity through successful debenture issues through 1979 to 1982, he was able to raise up to Rs 500millions. A very important philosophy of Dhirubhai was always to ensure that Reliance share were in the ascendant to draw maximum benefit for the shareholders for whom he was prepared to bend the Govt. rules, use his political influence and any legal Hera pheri required for the purpose.Dhirubhai made sure that whenever Reliance had to impress the Govt. to modify the existing rules and regulations, they used to have all the information in India and abroad on the fingertips of the group which met and influenced the Govt. Reliance always managed to maintain its zero-tax status by changing its accounting practice by capitalizing interest for the long term debt for the purchase of fixed assets. Many people felt that Reliance was avoiding taxes by cheating the Govt. However, all the profits were ploughed into the company by Dhirubhai and his family so that business prospered.
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Dhirubhai had the knack of taking on people like VP Singh in which he had the inherent support from Ms. Indira Gandhi, Pranab Mukherjee and Rajeev Gandhi. One best example is when he contracted the purchase of a whole years supply of PTA of 60000 tons by having letters of credit from many banks when the Govt. was about to decide to shift imports of PTA from open license to permissible limited list. Dhirubhai was able to show his one-upmanship against Nusli Wadia and Goenka of Indian Express which were bent upon destroying Reliance. Though this led to his paralysis and later failing health, he was able to broker peace with his enemies through the success of Reliances G series along with the meeting of Dhirubhai with Rajeev Gandhi through the good offices of Amitabh Bachhan when VP Singh was shifted from Finance to Defence. However, there was never formal delegation of authority in Reliance as there was flexibility as well as ambiguity. Only the top managers could call the shots in addition to Dhirubhai and his sons. In spite of this, Dhirubhai was very considerate to his employees like when Mr. Sanghvi incurred a heavy loss in a deal with a view to increase the profit for Reliance. After 1995, Dhirubhai handed over the reins of his empire to his sons though he did not lose his craving for money and power since he was always available for expert advice. According to Anil Ambani, his fathers only fault was he thought too big and clearly ahead of his time.
Dhirubhai Ambanis Impact on Reliances Managerial Practices and their Positive Impact on Business
The great success of the Reliance Group is in no small measure to epoch making changes in management practices and philosophies brought about by Dhirubhai Ambani based on his convictions Dhirubhai that reflect his unique on
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Reliances management practices. Dhirubhai Ambani was a transformational leader. His innovative idea of converting the debentures of the company into equity shares resulted in far reaching changes in the management practices. Reliance was able to convert its liabilities into assets by this masterstroke and the share prices of the company went up and all the investors could make through this process. Though, the Government of the day was against this equity cult starter by Dhirubhai per say, but, over a period of time based on precedence in foreign companies, the statute book itself was modified to be in line with this innovative idea. Consequently, the volumes of business in Reliance increased very fast along with quick multiplication of its share capital.
Dhirubhai was a visionary who foresaw that mere financing through banks and public limited companies will not suffice to increase the wealth base of Reliance. So, he was able to convince the people of rural Gujarat and elsewhere that shareholders of the company will have handsome returns on their investments. This approach resulted in having more than 3 million shareholders investing in Reliance, which is the highest number in the world for any company. As a result, Reliance Industries was the only public limited company whose annual general meetings had to be held in open air stadiums. So much so, with almost 20% of the shareholders in India belonging to Reliance, it became a dictating factors in Indian economy, courtesy the Indian stock markets. Dhirubhai Ambani believed that his people were his most important assets. The most talented professionals were drawn from all and sundry, were nurtured and continuously provided initiative to aim for still higher goals and targets. These highly motivated people comprised the core of what is known as the Reliance family. This practice improved the working of not only Reliance, but other prospering companies who followed this practice also prospered in the long run. He also empowered his managers by giving authority to them to work independently to work independently he had belief in the
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capabilities of his people. This has grown to become the core of the Reliance groups HR policy of staff recruitment and maintenance. Dhirubhai was a risk taker, but was only prepared to take calculated risk based on the expected future trends. He invested his entire earnings to purchase a huge stock of polyester yarn which was felt as a wrong decision by others because cotton was the king in India at the time. But he proved right and this made him a billionaire as polyester caught the fancy of the people for better value and longer wear and tear period of the clothing. This influenced Reliance to such an extent that it went on with the purchase of polyester technology from DuPont as the first non- American company to do so. This move gave the Reliance Group monumental financial resources that helped build a robust growth engine and also developed a core competence to grow business, expand and diversify into a potato-to-petrochemicals conglomerate at a break neck speed.
When Dhirubhai felt that was a lot of opposition for the introduction of polyester cloth for retail outlets, he started his own chain of distribution centers and gave retail agencies to many of his shareholders on franchise basis. This made it possible for only Vimal to penetrate through A and B class cities and semi-urban neighborhoods which made the market blossom to absorb additional supplies and increase the demand for the same all over the country. In the long term perspective, this also helped develop the much needed knowledge of supply chain management strategies in the Reliance Group, which now boasts of one of the best supply chains in the country in the category of departmental stores, food chains, pharmacy drug stores etc. Dhirubhai Ambani was the one of the first Indian businessmen to realize that high quality actually costs less. Dhirubhai always insisted that Reliance use the best and finest state-of-the-art machinery, equipment and manufacturing facilities. Under his stewardship, the Reliance Industries operated the best manufacturing plants in the country, a comment by the World Bank team affirming the same being a testimony to its technological advancement. In the long run this emphasis on constant up gradation of facilities improved
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the capacity utilization, economies of scale and reduced the production costs per unit in various factories of the company. Also, this philosophy helped the company to vastly cut down its production/manufacturing costs, provide higher quality products and product pricing flexibility in many of their high volume- low margin businesses.
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group of Industries (Reliance), Hirachand (Dhirubhai) died after a 13 day battle for survival. A perfect combination of entrepreneurship and leadership, Dhirubhai transformed Reliance from a company with a turnover of Rs 640 million in 1976, to one with a turnover of Rs 620 billion in 2002. Starting with a small textile mill in Naroda, in 1966, Dhirubhai took Reliance into various areas like petrochemicals, polyester filament
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yarn, oil and gas exploration and production, refining and marketing of petroleum, textiles, power, telecom services, information management and financial services (Refer Exhibit I for Reliance Group of Companies).Dhirubhai never followed the textbook style of management. Instead, he evolved a unique style, which combined the American style of entrepreneurship, with the Japanese focus on the latest technology. And to this, he added the innate shrewdness of a Gujarati businessman. Analysts feel that he was a perfect manager of time, money and men and exhibited a passion to find solutions to problems. Dhirubhai started Reliance at a time when most companies in India were owned by the government, and the private players were given step-motherly treatment by the government while offering licenses and permits. Similarly, when most Indian business houses depended on government owned financial institutions for funds, Dhirubhai raised capital from the public by offering shares of his companies
Dhirubhai was born on December 28, 1932, to Hirachand Govardhandas Ambani and Jamunaben Hirachand Ambani. He was the middle of five children, three boys and two girls(Refer Exhibit II for the Dhirubhai family tree). His father was a local school teacher in a village called Chorwad in the Junagadh district of Gujarat. After his matriculation in 1949, Dhirubhai left for Aden, (now in Yemen) at the young age of 17. His first job was to fill gas and collect money at a Shell petrol station, earning Rs 300 a month. Within a few years, he rose to the position of a sales manager (Refer Exhibit III for Chronology of Events) in the same company. After working for eight years in Aden, Dhirubhai decided to come back to India and start something on his own. On December 31, 1958, he came back to Mumbai and started the Reliance Commercial Corporation (RCC) with a borrowed capital of Rs.15, 000. RCC was mainly involved in exporting commodities like ginger, cardamom, pepper, turmeric, and cashew nut. Using his connections in Aden, he exported a wide range of commodities to Aden. Aden, being a free port attracted lot of exports. In the mid 1960s, the Government of India (GoI) introduced an export promotion scheme under which the earnings from the export of rayon fabrics could be used for the import of nylon fiber. This attracted Dhirubhai's attention and he decided to switch from spices to textiles. In1966, he set up a spinning mill at Naroda 20 kms from Ahmedabad with
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borrowed funds of Rs 2, 80,000 and registered it (Reliance Textile Industries) as a powerloom unit with a paid up capital of Rs 150,000. Another program, the High Unit Value Scheme introduced by the Govt. of India in 1971 gave tremendous boost to Reliance textiles. The scheme allowed the import of polyester filament yarn against the export of nylon fabrics. RCC was benefited the most from this scheme and its exports constituted more than60% of exports under this scheme. There were rumors that the scheme was solely devised for Dhirubhai. Dhirubhai strongly denied the allegations saying that Reliance cannot be blamed for taking advantage of the scheme 'when others kept their eyes shut.' He said "I do not consider myself cleverer than my colleagues in the industry. If there was a very large margin of profit, why did they not take advantage of it?" When the High Unit Value scheme ended in 1978, Dhirubhai focused his attention on the domestic market. During this time, Reliance Textiles was not a very well known name in the domestic market. His first priority was to establish the Vimal brand, under which Reliance Textiles sold its fabrics in India. An advertising programme was launched to facilitate its entry into the domestic market. Dhirubhai knew that a strong brand image was crucial for winning the consumer's confidence. To achieve this objective, Reliance tried to emphasize the superior quality of its fabric in all its advertisements. Besides this, Dhirubhai also took steps to develop an efficient distribution system for Vimal as he found that the existing marketing channels were inadequate and inefficient. However, things were not that easy. When Reliance entered the domestic market, it faced lot of resistance from the traditional cloth merchants, as their loyalties lay with the older mills. Confronted with this situation, Dhirubhai decided to move away from the traditional wholesale trade and open his showrooms to tap new markets. He appointed several agents from non-textile backgrounds for the same. Dhirubhai adopted the concept of company stores from its main competitor, Bombay Dyeing (Refer Exhibit IV), and pursued it on a grand scale. Dhirubhai toured the entire country intensively, offering franchises to shareholders. Dhirubhai promised that Reliance would provide financial and advertising support. In his search for high volumes, Dhirubhai identified a new market - the non-metro urban
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segment. By 1980, Reliance fabrics were available all over India through 20 company owned retail outlets, over 1000 franchised outlets, and over 20,000 retail stores. To strengthen his position further, Dhirubhai decided to integrate backwards and produce fibers. He planned to set up a polyester filament yarn (PFY) manufacturing plant at Patalganga. Dhirubhai started work on the plant in 1981. He wanted to make it a worldclass plant equipped with the best machinery and having the best faculties. The technology for the production of PFY was sourced from USA's Du Pont De Nemours. However, Dhirubhai did not want to make Du Pont an equity partner. He felt that when technology was easily available in the international markets, it was not necessary to enter into a 51 %equity partnership with a foreign company. In spite of the demand for PFY being 6000 tons per annum (TPA), Dhirubhai built a 10000tpa plant with a built-in expansion provision of 15000 TPA. Dhirubhai's biggest contribution to the nation was the development of an equity culture. Having understood the psychology of the Indian capital markets and the mindset of Indian investors, he was instrumental in introducing the equity culture in India. Dhirubhai gave importance to the small investor and his contributions, and by doing so, he involved millions of middle class investors. Reliance went public in 1977 and had its first annual general meeting (AGM) in 1977. Reliance Industries had 58000 investors in 1977. So large was Reliance's investor base that at times executives had to go to small cities, with the share certificates, annual reports and other such correspondence, as personal luggage, and post them locally. Reliance holds the record for bringing out the single largest domestic issue of more than Rs21 billion in convertible bonds for Reliance Petroleum in 1993. The market capitalization of Reliance was Rs 1.2 billion in 1980, which rose to Rs. 9.96 billion in 1990, and shot up to96.2 billion in 1995, making Dhirubhai one of the richest men in the world. The end of the High Unit Value scheme of 1978 brought about a dip in the profits of Reliance. In spite of this, Dhirubhai declared a dividend of 27 %. Whenever Reliance needed money to fund its expansion purposes, Dhirubhai opted for a public issue. From 1979 to 1982, Reliance brought out several issues for different purposes like: financing a worsted
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spinning mill, modernizing its already existing textile mill, financing a PFY plant, and to overcome the bear syndicate crisis respectively. The 1979 issue of Reliance introduced an innovative financial instrument, the partially convertible debentures. However Dhirubhai found it difficult to get permission from the controller of special issues. Dhirubhai argued that this instrument would give investors a guaranteed return and capital appreciation. He lobbied the government until it accepted the concept. This issue was oversubscribed 6 times and soon convertible debentures (both partial and whole) became instruments of choice. The 1982 issue generated Rs 500 million. It was the biggest issue in those days. In 1982, Dhirubhai faced threat from a Calcutta based bear syndicate. The bear syndicate sold 1.1million Reliance shares worth Rs 160 million on March 18, 1982. This was all a part of their short selling strategy wherein they planned to buy the same shares at a later stage for cheaper rates, making considerable profits.
shares and the share prices soared to an all time high. By May 10th, the crisis ended. Dhirubhai finally succeeded in taming the bulls.
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Dhirubhai was of the opinion that business was not all about ethics and morality; it was about expansion and success. His amazing ability to use the state and its policies to his advantage was responsible for the expansion of Reliance. Be it licenses, foreign exchanges or quotas, he always succeeded in making the best out of most difficult situations. However, his immense success earned him a number of enemies. The fight between Nusli Wadia, the Bombay Dyeing chief and Dhirubhai is well known in the Indian business circles. Both of them were adept in using their business and political connections to suit their ends. During the Janata Party rule (1977- 1979), Nusli Wadia obtained the permission to build a 60000 TPA di-methyl terephtalate (DMT) plant. However, before his letter of intent could be converted into a license, the government changed and when the Congress government came to power, his license was being delayed (until 1981) with one pretext or the other. This was the same time when Dhirubhai obtained license to build a PTA plant. Dhirubhai was also contemplating on building a Paraxylene facility. All this infuriated Nusli Wadia and marked the beginning of one of the major battles in the history of Indian business which lasted for several years. In the 80s, Ramnath Goenka, (Goenka) the proprietor of the Indian Express Group which was into news publication, had often tried to act as a mediator and solve the conflict between the two corporate giants; but in vain. Goenka backed Nusli Wadia. He considered the latter his son and at times, urged Dhirubhai to bring the rivalry to an end. Even though Dhirubhai promised to do so, he continued his fight with Wadia and Goenka felt betrayed. Soon, Goenka turned against Dhirubhai and launched a series of press campaigns against Reliance. Goenka always promised Dhirubhai that he would put an end to the campaigns being held against him in the press. But the very next moment, he would scheme another plot against him. The assaults did not stop even when Dhirubhai was hospitalized after his first stroke in1986. Newspapers, magazines and weekend tabloids continually attacked Dhirubhai. To counter these attacks, a few weeks later, Reliance issued 15 advertisements in leading newspapers of the country including the Indian Express. The advertisements contained key statements like "concern for truth", "allegiance to ethics", and "commitment to growth". Goenka formulated a fresh assault issuing a statement that Reliance had smuggled extra machines into the country, and therefore had excess
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built capacity. This resulted in a show cause notice from the customs, and a duty and penalty claim of Rs.1.19 billion on Reliance. In spite of all these attacks, Dhirubhai never failed to retain public confidence. Slowly, tables started turning against Goenka. In September 1987, there was a nationwide raid on the Express group, and a number of cases were filed against it. Dhirubhai was victorious for once. After Goenka's death in 1991, his son, Vivek Goenka took over. But he did not see much sense in lobbying against Dhirubhai and this brought to an end the big battle.
the outflow of interest, and increase the inflow of funds. But V P Singh was against it. But once V.P Singh was transferred from the Finance Ministry to the Defence Ministry, the conversion of the debentures into shares was permitted and the pending licenses were cleared. October 1986 turned out to be quite favorable for Reliance. The debenture conversion move proved highly beneficial. A secret meeting between Dhirubhai and Rajiv Gandhi seemed to trigger off a series of decisions in favour of Reliance. Some more pending licenses were cleared. The customs levy of Rs 3 on each kilogram of PTA was abolished, and the Patal Ganga complex was granted refinery status thus, enabling it to pay a low level of excise duties for raw materials like naphtha.
a turnover of Rs 620 billion, assets worth Rs 564.85billion, and force 85,000 people accounted for 5% of the Central Government's total revenue. It contributed 3 % of India's GDP, 5 % of the total exports, and 9 % of the GoI's indirect tax revenues. Reliance also accounted for 25 % of India's total private sector profits. Reliance secured nearly 10 % of the profits of the entire corporate sector in India. Moreover, one out of eve ry four investors was a shareholder of Reliance. Reliance acquired IPCL, the Indian petrochemical giant. This acquisition gave Reliance a sound footing in the global petrochemicals market. By 2004, it plans to take over more than 35 % of the global market. This would make Reliance the 11th largest polymer producer in the world. With the amalgamation of RPL with RIL, Reliance became the only company in the world to have fully integrated world scale operations in oil and gas exploration and production, refining and marketing, petrochemicals, power and textiles.
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Presently Reliance enjoys global ranking in all major businesses and its shares lead the domestic market. According to the global Fortune 500 rankings, Reliance ranks amongst the top 200 companies in terms of net profit, amongst the top 300 in terms of net worth, amongst the top 425 in terms of total assets, and amongst the top 500 in terms of sales. Reliance Mobile, the new venture of Reliance provides cellular telephony services in 13Indian states, and Reliance Basic holds the license to provide fixed line telecom services in the state of Gujarat. With the launch of Reliance Infocomm, Reliance has taken another major step in its continuous search for growth and excellence. It was Dhirubhai's dream to provide information technology and communication facilities to the common man, at affordable prices. The Infocomm revolution will cover thousands of villages across the country by 2003. Reliance Power intends to pursue opportunities in the power sector with an objective to achieve over 10,000 MW in the next decade. With Reliance General Insurance and Reliance Life Insurance, the group has also entered into the insurance sector. Dhirubhai's entrepreneurial abilities enabled Reliance to progress on the roads to success both in the licensing era as well as in the era of liberalization, privatization and globalization. He faced the toughest battles with the toughest of politicians and bureaucrats and was eventually successful in gaining a victory over all his political and corporate rivals. His business ideologies have been praised and are being emulated the world over (Refer Exhibit VI, for Management Mantras of Dhirubhai and Exhibit VII for achievements of Dhirubhai).Some skeptics believe that Reliance would no longer be the same after Dhirubhai. The extraordinary growth of the company was based on the vision, energy and lobbying power of Dhirubhai as well as the willingness and ability of the Indian government to promote its expansion. The competition now is with major multinational players whose ability to influence governments in various ways is well known. Right from the time he suffered his first stroke in 1986; Dhirubhai groomed his sons Mukesh and Anil Ambani to take care of the day-to-day operations of Reliance. It was from Dhirubhai that his sons imbibed the quality to think big. Mukesh's skills were quite evident from his
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successful management of the Patalganga and Jamnagar projects and Anil was adept at the finances. Despite their elite education, their most important training came from Dhirubhai. He provided them with a strategic vision. His sons always considered themselves as co builders rather than inheritors of Reliance. Dhirubhai's words way back in 1993 reflected the immense confidence he restored in his sons, "Reliance can now run without me." After his demise, Mukesh was appointed the Chairman and Managing Director of the Reliance group while Anil became the Vice Chairman. It remains to be seen whether Reliance will maintain its lead and growth over large multinationals in years to come.
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In his private life too, Dhirubhai fulfilled every role and responsibility with aplomb. He was a caring husband, a loving father, an indulgent grandfather and a loyal friend. He devoted a great deal of time and energy to his childrens learning and to the development of their personalities. Every day, over dinner, he would take time out to update him on what his children were doing (and learning) and to encourage them to further expand their horizons. He took the word impossible out of his grandchildrens vocabulary and inspired them to see the world as a place of exciting and limitless opportunity a place where you could make things happen not because you were wealthy but because you were had the courage, boldness and initiative. In doing so, he bequeathed to them a legacy far more precious than what any wealth could bestow. Talking of the reasons behind her decision to write on Dhirubhai, Kokilaben says, I felt, all these facts from his life should be recorded for posterity. The world has seen him as a successful industrialist; but I have seen him in the role of an excellent man. I wanted to draw his personality as a humane individual, and thats how I was inspired to write this book. Dhirubhai held dear the accolades he received, but the Wharton Deans Medal was especially significant as he was the first Indian to receive it. On the occasion of the first Dhirubhai Ambani Memorial Lecture held in Mumbai, Dr. A.P.J Abdul Kalam, President of India, had talked of Dhirubhai as a man whose guiding hand and loving nature will always be missed. The book will go some way in making up for that sense of loss. The Bhagwad Gita states The actions of a great man are an inspiration for others. Whatever he does becomes a standard for others to follow. One hopes this book will bring Dhirubhai closer to the people so that his life and actions become an inspiration and a standard for others to follow.
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"Growth has no limit at Reliance. I keep revising my vision. Only when you dream it you can do it." "Think big, think fast, think ahead. Ideas are no one's monopoly" "Our dreams have to be bigger. Our ambitions higher. Our commitment deeper. And our efforts greater. This is my dream for Reliance and for India." "You do not require an invitation to make profits." "If you work with determination and with perfection, success will follow." "Pursue your goals even in the face of difficulties, and convert adversities into opportunities." "Give the youth a proper environment. Motivate them. Extend them the support they need. Each one of them has infinite source of energy. They will delve between my past, the present and the future, there is one common factor: Relationship and Trust. This is the foundation of our growth"
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"We bet on people." "Meeting the deadlines is not good enough, beating the deadlines is my expectation." "Don't give up, courage is my conviction
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Whenever I tried to point out to him that a task seemed too big to be accomplished, he would reply: No is no answer! Not only did he dream big, he taught all of us to do so too. His one-line brief to me when we began Mudra was: Make Vimals advertising the benchmark for fashion advertising in the country. At that time, we were just a tiny, fledgling agency, tucked away in Ahmedabad, struggling to put a team in place. When we presented the seemingly insurmountable to him, his favourite response was always: Its difficult but not impossible! And he was right. We did go on to achieve the impossible. Both in its size and scope Vimals fashion shows were unprecedented in the country. Grand showroom openings, stunning experiments in print and poster work all combined to give the brand a truly benchmark image. But way back in 1980, no one would have believed it could have ever been possible. Except Dhirubhai. But though he dreamed big, he was able to clearly distinguish between perception and reality and his favorite phrase dream with your eyes open underlined this. He never let preset norms govern his vision, yet he worked night and day familiarizing himself with every little nitty-gritty that constituted his dreams constantly sifting the wheat from the chaff. This is how, as he put it, even though he dreamed, none of his dreams turned into nightmares. And this is what gave him the courage to move from one orbit to the next despite tremendous odds. Dhirubhai was indeed a man of many parts, as is evident. I am sure there are many people who display some of the traits mentioned above, in their working styles as well, but Dhirubhai was one of those rare people who demonstrated all of them, all the time.
reminded of how Dhirubhais management techniques used to be [and still remain] so refreshingly different. For instance, way back in the late 1970s when we decided to open an agency of our own, he asked me to name it. I carried a short list of three names, two Westernized and one Indian. It was a very different world back then. Everything Anglicized was considered up market. There were hardly any agencies with Indian names barring my own ex-agency Shilpi and a few others like Ulka and Sistas. He looked at the list and asked me what my choice was. I said Mudra: it was the only name that suited my personality. And the spirit of the agency that I was to head. I was very Indian and an Anglicized name on my visiting card would seem pretentious and contrived. No further questions were asked. No suggestions offered, just a plain and simple Go ahead and do it. That was just the beginning. He continued to give me total freedom no supervision, no policing in all my decisions thereafter. In fact, the only direction that he gave me, just once, was this: Produce your best. His utter trust in me was what pushed me to never, ever let him down. I guess the simplest strategies are often the hardest to adopt. That was the secret of the Dhirubhai legend. It was not out of a book. It was a skillful blend of head and heart.
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Take Indias push for development. There was once a time our countrys growth rate was just 4 per cent, sarcastically referred to as the Hindu growth rate. Look at us today, galloping along at a healthy 7-8 per cent. This is no miracle. It is the product of a handful of determined orbit changers like Dhirubhai, all of whose efforts have benefited a larger sphere in their respective fields. In a small way, I too have experienced the thrill of changing orbits with Mudra. In the 1980s, we leapt from the orbit of a small Ahmedabad ad agency to become the countrys third largest ad agency in just under a decade. However, when you change orbits, you will create friction. The good news is that your enemies from your previous orbit will never be able to reach you in your new one. By the time resentment builds up in your new orbit, you should move to the next level. And so on. Changing orbits is the key to our progress as a nation.
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He was always inviting people into sharing their thoughts and ideas, rather than shutting them out. On hindsight I think, it must have required phenomenal generosity of spirit to be that inclusive. Yes, this was one of the things that was uniquely Dhirubhai that warm arm around my shoulder that did much more than words in letting me know that I belonged, that I had his trust, and that I had him on my side!
segmentation. The numbers say it all. In Jan 2003, the mobile subscriber base was 13 million, about 16 months later, shortly after the launch, it had reached 30 million. In March 2006, it has touched 90 million! Yes, this was yet another unusual skill of Dhirubhais his uncanny knack of knowing exactly how the market is going to behave.
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Conclusion
India is fortunate to have a number of trailblazers who established giant industries in India which prospered by their special managerial skills acquired through practice or through brain waves or through hereditary excellence of business background. These include Tatas, Birlas, Khaitans, Goenkas, Bajajs, Ambanis, Jindals, Mittals, Ruias, Mirchandanis and individuals like Vijay Mallya and Bhai Mohan Singh of Ranbaxy. Their descendants today control more than Rs. 800billion through 600 companies employing about one lakh people. We use their products day in and day out whether it is consumer durables, electronics, basic necessities and luxuries of life. One of the greatest businessmen India has produced is Dhirubhai Ambani, a synonym for Reliance and Vimal. For his vision, leadership qualities, trailblazing characteristics and go-getting approaches, which have all put Reliance and his sons now at the top of the richest people in the world, out team have selected Dhirubhai Ambani as a quintessential representative of a specific leadership style which, among other things, will be explained in detail in this term paper. For a matriculate from a middle class family starting his trading life in Africa with M/s. Besse &Company, a small sub-division of Shell, rising to the pinnacles of business excellence hardly in three decades speaks volumes of the qualities of head and heart which guided Dhirubhai Ambani in his long but eventful journey through the corridors of yarn markets, trading, textiles, petrochemicals, polyester manufacturing and what not, thus embracing and encompassing all possible business areas which guaranteed a good profit and best value for money, not only for his family members, but for the millions of his shareholders. It was a unique spectacle that the annual general body meetings of Reliance were always held in open auditoria or maidans just because thousands had to be accommodated is still one of the most unique phenomena in the Indian business scenario.
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