Business Secrets of Dhirubhai Ambani, Founder of Reliance Industries
Dhirubhai Ambani: The Indian Business Icon
Dhirubhai Ambani, the founder of Reliance Industries, was a genius who had extraordinary talent. He was creative and mastered the secrets of business, a pioneer among businessmen in India. He wrote his own story and became a hero of his century, changing the shape of Indian investing.
This Indian business icon had a real rags to riches story and was undoubtedly the most talented businessman of his time. He amazed the world. Born in Gujarat, he became a celebrity in India and overseas. Kokila Ben Ambani, his devoted wife, supported him and always remained behind him in all his achievements.
What were the secrets of his amazing growth? What made him Dhirubhai Ambani? How did he became an industrial tycoon and a global conglomerate? Why does he have fans in India, the US, the UK, the EU, Canada, and elsewhere?
1. Gather Information, Whatever It May Be
- Gather information about governments, local, state, central and international
- Gather information about products, companies, consumers, markets, people, services, and politics
- Do not forget to get information about your competitors
He was able to quickly gather, process, and analyze information and disburse it to his subordinates when and where required. Through the information, he was able to find new opportunities.
Prof. M.L. Sisodia, one of my friends and a senior professor of physics and a research scholar, once told me a story about Dhirubhai Ambani.
Mr. Sisodia had undergone a bypass surgery after a heart attack. A few days after his surgery, his son was called for an interview with Dhirubhai Ambani.
Dhirubhai wanted him for a senior position in his company. The very first question Dhirubhai Ambani asked him was "How is your father?"
This instance alone is enough to show his capability to gather information, even though it was not yet the internet age.
2. Find Opportunity
He always endeavored to analyze whatever information he had. He would convert information into profit-making opportunities.
According to him, "There is no invitation for making profits." You have to find it.
3. Jump From One Orbit to the Next
No matter where you are, just work there. Master that place or situation. Accumulate some energy and then jump into a higher orbit. Stay there for some time and control it and master it. Then, jump to another, higher level, the next orbit.
Dhirubhai did this many times during his life. Caution: Do not jump from one orbit to another without mastering the present orbit. This could be dangerous. Be patient.
4. Complete Projects On Time
Learn to finish before the scheduled time. He and his sons completed all their projects on time or even beforehand. It didn't matter how big the projects were or how many hurdles they faced, they still completed them in a timely manner.
Dhirubhai Ambani and his sons Mukesh and Anil developed some techniques to make sure they were always on time, monitoring their projects closely.
5. Think Big. Think Global.
He was thinking global even before the current trend of globalization. Most Indian companies were not doing well in the global scenario at his time and were not acting with global standards.
He made world-class projects and world-class factories. Nobody in India was even thinking about that at the time.
6. Hire the Best People. Pay Them Well.
Dhirubhai Ambani was able to employ the best, top-ranking people in every field. He was an excellent employer, never compromising on quality or timeliness. He could only do what he did with the best people. According to him, human resources are the most important resources.
7. Pay Shareholders Well.
His ambitious projects needed a lot of capital but bankers and financiers failed to trust his capabilities. They were reluctant and did not agree to fund his projects because they were risky.
So Dhirubhai Ambani went to his shareholders since he recognized them as the best source of funding and asked them for money. The shareholders jumped at the chance to fund his projects and he paid them handsomely, rewarding them for their trust.
He realized that shareholders would never be satisfied with dividends that matched the trend at the time. He knew the value of capital appreciation so he paid bonuses, and issued rights to his shareholders in addition to regular dividends.
He went beyond the expectations of his investors. He even went to the extent of challenging the law. Once he converted non-convertible debentures into shares, creating enormous profit even though it was against the law. He fought against that law and the government was compelled to change it.
In his time, he had the highest number of shareholders. He boosted the market capitalization of BSE and brought millions of shareholders under his umbrella, many of them first time investors.
Mukesh and Anil Ambani
Dhirubhai Ambani followed these secret techniques of business throughout his lifetime. He was not very interested in the books or magazines about management. Rather, he left those for his subordinates and his managers. He had an appetite, a never ending hunger for news.
Starting as a low-level employee of a gas station, he became an industrial giant, a global conglomerate. His name was included in the Fortune 500 and he could manage a yearly revenue of $78 billion. At that time, no other Indian industrialist had achieved something like that. But he was not satisfied—he was dreaming of being the world's richest person. He only did not achieve this because of his untimely death.
However, it has been achieved through Reliance industries, which he founded. Today, the combined assets of Mukesh and Anil Ambani (the sons of Dhirubhai Ambani, between whom his assets were distributed) is more than Bill Gates of the Microsoft corporation.