Empire of Enterprise

India Today Cover Story
December 27, 2010

Basant Kumar Birla, 89

Even today, Basant Kumar Birla's day starts as early as 4 a.m. but he doesn't hop into an aircraft to visit factories and manufacturing units. He entertains guests in the morning with his wife Sarala or spends time in his massage chair. Yes, life has changed for the Birla clan patriarch. He has difficulty hearing and his memory is short-lived but Babu, as he is fondly called, likes to retain a semblance of his former life. While his peers have resigned to a life of seclusion, Basant still goes to office in Birla House every day by 10 a.m., his loyal 'bearer' holding his briefcase.

It seems like aeons ago when he entered Birla Brothers in 1936. "I got involved in the business when I was 16," says Basant as his wrinkled skin stretches into a wide smile. His first major responsibility was to handle Kesoram Cotton Mills, which his father Ghanshyam Das handed over to 25-year old Basant in 1946. "I used to get between Rs 500 and Rs 1,000. Now it's a pittance, but 60 years ago, it was quite something," he recalls. Today, B.K. Birla's empire has a combined turnover of over Rs 10,000 crore.

This grand old man of India Inc has weathered many storms. When he was at the peak of his business life, the relationship with the government was strained. One had to beg or bribe ministers for permits; economic growth was slow and policies didn't favour development. "The pre-liberalisation era was a difficult time for me and the group. Income tax was much higher and no bank used to give loans. In the face of growing obstacles we decided against any kind of expansion.

“During the licence raj, there was a lot of control over businesses," he says. Today, he is all praise for Prime Minister Manmohan Singh, whom he calls "honest and pro-development". "Things are much more transparent now. I remember how my son Aditya Vikram was humiliated when he was asking for permits and that's why he went to Bangkok and started expanding in South-east Asia, Philippines and Egypt," Basant says. From the time Ghanshyam Das started a trading company with his brothers, there has been a paradigm shift in the attitude of industrialists. "My father was very cautious, I was cautious, but my son focused on expanding. My grandson Kumar Mangalam is not at all cautious; he is expanding even more aggressively, which is required in today's age because of the growing competition," he says. But life for today's industrialist is definitely no cakewalk. While Basant's life revolved around visiting factories and attending board meetings, corporates today have to focus on everything from advertising, product development to roadshows and promotional events.

Long before the concept of corporate social responsibility came, Ghanshyam Das openly contributed to the Congress in its fight against the British. "There was talk of getting my father arrested. But the British didn't dare as they understood that all the industrialists would turn against them if they arrested someone as influential as my father," he says. Today, even though industrialists are helping society, more awareness is required, Basant says. "There is a lot of scope for industrialists to give back to society. They need to spend money, that's all. I have asked Kumar to get more involved in social work." Basant has given back to society in his own way. He has started 11 educational institutions, including schools and engineering colleges. The Birlas developed their hometown of Pilani by establishing the Birla Institute of Technology and Science, and B.K. Birla Institute of Engineering and Technology. Basant and his wife also collected almost 3,000 works of art and this passion led to the setting up of the Birla Academy. The couple entered the Limca Book of Records this year for being the 'longest serving couple in a non-profit cultural institution'.

Once he returns home at 3 p.m., there's nothing much for him to do in the palatial house. When they are not on their bi-annual trip to London and Switzerland, the couple spends time playing matchmakers to willing young men and women. On some days, Basant tunes into his favourite singer K.L. Saigal and thinks about the life he has led, his progeny waiting in the wings and his beloved wife who has remained by his side all along.

—By Shutapa Paul

Kumar Mangalam Birla, 43

There are not enough hours in the day for Kumar Mangalam Birla, who regularly finds himself in the office on a Saturday, buried under work. Work usually spills into part of his Sunday, leaving only a shred of the weekend for his wife and children, although he's desperately trying to improve the work-life balance. It is a familiar predicament faced by the businessman of today. "The demands on our time are increasing. Time management is key," says the chairman of the Aditya Birla Group. Birla, who starts his day at 7.30 a.m. with an hour of yoga to ready himself, says it's a skill he's constantly honing.

The time-pressured scenario is a result of today's business climate and the nuances that come with it. Managing a business is more complex against the backd;rop of liberalisation, globalisation and fierce domestic competition, he says. "You cannot afford to nap even for a short while." Not only does a business need to be examined from far more perspectives, but external issues such as corporate governance, meetings with bankers, investors as well as the Government also cut into the day. Moreover, the Government is leaning on the business community more than ever as it powers India's economic success story. This means business tycoons such as Kumar Mangalam are constantly being sought out. The inheritor of the Birla empire also sits on and heads various advisory panels such as the prime minister's Advisory Council on Trade and Industry. "Businesses have become more important institutions in society," says Kumar Mangalam. It means the time he gets to unwind is precious. For a person like him, who is not very fond of socialising, it means spending time singing at weekly family satsangs, taking his wife to her favourite Italian restaurants across the city, reading management books and learning photography.

While competition has c;reated more challenges for business, it has also remoulded the business style and psyche of today's entrepreneurs. Aggression has pipped caution. Kumar Mangalam has fuelled the growth of the company from $2 billion to $30 billion in 15 years and given it a multinational face in 27 countries. When he joined in 1995 at the age of 28, India was on the cusp of economic liberalisation. "Risk-taking ability has increased with every generation. It's derivative of higher competition and aspirations as well as easier access to capital. Plus, the world is becoming smaller, so you can look at a number of opportunities," he says. And this aggressive streak has translated into 18 acquisitions, foreign as well as domestic, in his tenure. This includes the 2007 acquisition of aluminium rolling company Novelis, which he turned from a loss-making to a profit-making business. "You need different skills and competencies for acquiring a business," says Kumar Mangalam.

While attack has defined his business strategy at one level, Kumar Mangalam's democratisation of the workplace and empowerment of individuals have been his other contributions. Again, he says this is a sign of the times. "Business is more informal now but more structured. There is more participation, delegation and democratic empowerment. It reflects changing times," he says. He adds that employees' aspirations and ambitions need to be met in the framework of the company, which comes by institutionalising systems. "The objective is to provide a workplace that is the best and a workforce that is happy," he adds. And it has succeeded with the company scooping many employer awards. As part of delegating and decentralising power, Kumar Mangalam has introduced four-member committees for each of the group's 14 businesses that review units as well as empower committees of senior managers to take decisions such as capital investment and allocation.

The shift to technology has reduced the burden on businessmen to some extent. Heading a multinational company, Kumar Mangalam can avoid extensive travelling, thanks to advances such as video conferencing. The one quality needed to survive and succeed is passion. "Nowadays you have to get more out of fewer resources and be productive. This makes it a highly charged environment. This in itself is a huge adrenaline rush and it's the dedication to what I do that keeps me going," he says.

— By Nishika Patel