22 December, 2000
Bhakti Chuganee
Business India

In just eight years at the helm, Kumar Mangalam has grown the A. V. Birla group fourfold. But while he himself has grown immensely in stature, the essential simplicity remains.

The name Kumar Mangalam has a meaning. While Kumar means young, Mangalam encompasses tranquillity, prosperity, happiness, well-being. Kumar Mangalam Birla's grandmother Sarla Devi Birla thinks both words together make it a beautiful name and can't understand why everyone calls the chairman of the Rs 27,000-crore Aditya Birla group just 'Kumar'. Mangalam is the main thing in the name. But just so everyone in the group could understand what she was saying, Sarla Devi sent out a note to the departments concerned explaining the meaning of his name.

If one takes the meaning into consideration, and applies it to what 36-year-old Birla has achieved, itseems he is living up to his name. When in 1995 a 28-year-old Birla stepped into the very large shoes of his father, the late Aditya Birla, sceptics wondered if he would be able to lead a 60-year-old group. Birla, on his part, had no time to think. "Well, one did get intimidated. One did realise that it was a big responsibility, but there was no time to brood, let's put it that way. So one just got on with the job. The day after the funeral I was in the office," he says.

When Birla stepped in as chairman he had the experience of being in charge of a few significant units in the group -- Vikram Cement, Indo Gulf Fertilisers, the group's chemical division, and Alexandria Carbon Black, to name a few. He had no preconceived pan-group view in mind. Though he had worked very closely with his father for five years, and knew the issues that the group faced, Birla decided to takes things as they came. In the course of the first two years a lot of time went into thinking and talking to people. In a situation like this it was the urgent matters that took priority. He set off on an excruciating schedule, working very long hours. It gave him a sense of where things were, what needed attention, the group's capabilities, and its shortcomings. It was then that he started building on the group's strengths and filling in its lacunae.

Mahesh Bagrodia, MD of Birla Management Centre, who has worked with four generations of Birlas and was Kumar Mangalam's teacher at the units he was in charge of previously, says: "Personally speaking he had the advantage of having worked with his father. He was already involved in some of the major companies like Indo Gulf, Birla Copper, Vikram Cement, caustic soda, and carbon black. So I thought there would be no problem for the group. I also never thought that there would be such a quantum jump in the whole group, and his personality. No one would have dared to change all these things."

It was a time for Birla's own evolution as well. "One thing's for sure -- I've learnt a lot, and that's helped me to grow as a person, and as an individual, outside of work as well. And it's been a huge challenge," he says. Wife Neerja explains, "It was a difficult time for him. There was a personal loss. Prior to that he was looking after certain units, so the responsibility was less. Then the quantum of work increased x-fold; he was now dealing with people two or three times his age. He was stressed and ruffled easily. He is now calm and has learnt to take things in his stride."

Bagrodia adds, "At that time also the decisions that he was taking were very mature, and he would not take any decision in haste. Now of course he has matured very much." Amit Chandra, a member of the board of DSP Merrill Lynch Ltd, says: "While keeping the wonderful human side of him intact, he has become a lot more confident and bold as a leader."

Influences of his great-grandfather G.D. Birla and father Aditya Birla have also come into play. The relationship with his great-grandfather was one of unconditional love. Besides sharing a good rapport with him, Birla learnt from G.D. Birla that while you could get love and affection from people, there were norms to be followed as well. Birla reminisces that GD was particular about things like being on time for a family function, and dressing appropriately for functions. And in fact was reprimanded a bit for being late for the former, and made to go change for the latter. "For me he was my great-grandfather, someone I was attached to, someone who I could talk to, and someone who also could get angry with me. I took a very long time to get over the fact that he passed away. I just couldn't accept it, because he had been quite hale and hearty, and suddenly he had a heart attack and passed away. Sometimes it just puts into perspective the value of the person. I am really blessed that I spent time with him. I picked up so many things from him. Simple living and high thinking, nothing extravagant." Says grandfather B.K. Birla, "Honesty, integrity, and hard work are factors similar to all us Birlas. We are old-timers and Kumar Mangalam is 36. Age has its own effect on people."

He has tried to imbibe his grandfather's financial acumen, "but I'm not
sure how I've done on that," he adds. A very sharp man with outstanding time management skills, B.K. Birla has also done a lot for education and religion. "One has tried to do that consciously or unconsciously. I was also encouraged to be my own person," says Kumar Mangalam.

Having had the opportunity to work with his father, Aditya Birla's influence was a large one. "Anything that I've learnt in work has been from him. Seeing him in action, just absorbing from him. The way he was with people, the way he dealt with situations, the level of personal commitment," says Birla. In fact, he remembers a time in Baltimore, a couple of months before his father passed away. As his father was in a lot of pain, he was given drugs that had a sedative effect on him, and each time the effect would wear off his father would be signing papers. "That kind of commitment can come only from deep within," he adds.

Most in the group agree that Birla has the good balance of a great leader. "You can change a man's capability. I can change capability by training and motivating, but changing an attitude from achieving an also-ran kind of performance to a cutting-edge performance? That's leadership of very high kind," says Debu Bhattacharya, MD of Hindalco, and director in charge of Indal.

Birla's quiet confidence, and his ability to remain unruffled, his childlike innocence -- he doesn't pretend to be a know-all chairman, -- never out to impress anyone, and his reflective nature are qualities that are admired by senior executives from the old guard and the new. Seeing the concern and care for people that Birla demonstrates, it is something most want to inculcate.

According to Bhattacharya, "Mr Birla comes across as a man of great generosity, almost to a fault. It is a great quality I find in a manager. As a leader I've never seen a leader with so much empathy. And that empathy is not playing to the gallery, it is genuine. That is one thing you see through over a period of time." Even Neerja agrees with his knack for dealing with people. "His ability to handle people and their emotions is a major positive and has helped him through a lot of things," she says. "He's inspiring in a very understated way," adds Bhattacharya.

Corporate HR head Santrupt Misra points out, "He has a soft personality, with a strong will power inside him." Says grandfather B.K. Birla, "Despite all the power he has, he is humble to all of us and to his own staff."

In fact, as a leader, Birla's biggest strength is not only his people skills, but also his affinity to separate the chaff from the grain, and his ability to reduce very complicated issues to a simplified form, attacking the core, an ability he has demonstrated time and again. "Let's take an acquisition case, where we are looking at various things. He can cut out all the accounting jargon, he goes to the business core, and he can say therefore it looks attractive, and therefore the strategic value. He doesn't try to impose his authority on making a decision. He brings in a perspective," says Bhattacharya.

In the early days Birla had more of a mid-term agenda for the group. Today, with a long-term perspective, he comes across as a visionary. "One thing my father used to always say is that you should always have a view of the long term, and no shortcuts. That's always stuck with me," he says.

The evolution of the group started in 1996. What Birla has been able to do is orchestrate a team by both acquiring new skills from outside, and building on the enormous strengths the group earlier possessed.

The first visible signs of the evolution were the launch of a group identity -- the Aditya Birla group with the rising sun logo. "I felt we needed something to bond us. My father would never have named it the Aditya Birla group after himself. For me it seemed the most natural thing to do," says Birla. The group identity served like glue to stick people together. And from a business point of view it made sense to have a group identity, to which people could relate despite dealings with any of a number of separate companies, all falling under a broad umbrella of the Aditya Birla group. "From the investors' point of view, from that of the general public, even of the employees, they felt like they belonged to a much larger entity which was beyond their own profit centre or unit, or business or company," says Birla.

However, in the eight years that he has been at the helm, turnover has increased fourfold from Rs 7,200 crore in 1995 to Rs 27,OOO crore. Adversity brings the best out of Birla. According to Bhattacharya, "The metamorphosis of the group, which had a history of 60 years, and to change it from just one of the industry houses to a cutting-edge one in four, five years is perhaps a great challenge. First, to conceive this; second, to embark on this; and third, to succeed -- that's a great achievement." According to DSP Merrm Lynch's Chandra, "The most objective statement of Kumar's achievements is the fact that nearly all group companies have grown both top and bottomline strongly despite continuously falling tariffs over the last eight years. And the very fact that it the same media that virtually wrote him off when he took over have recognised him so strongly is an indication of his achievements in a short period of time."

One of Birla's main achievements is what is now very well known, the retirement policy.Though it was something that was absolutely needed to be done, it also changed the face of the group. Though the retirement policy was put in place in 2001, Birla took a year to think about actually implementing it. "In the end I came to the conclusion that even though you have to take a tough decision, it is for the benefit of the company," he says. "I think it's been one of the most important decisions I've had to make. I think any decision that directly impacts people's life becomes a very difficult decision to make, because you feel responsible. And when you've grown up with this trusteeship concept, then all the more. And especially when something that is a stark departure from what the group has been known to be like in the past from within. The intent was just to make sure we have all the right people," he adds. Today the group has a good mix of the old and the new. According to Chandra, "Kumar has focused hard on growth of management talent and deepening the decision-making processes at the senior level. He recognises that taking the group to the next level will require a further impetus in that direction."

The new millennium Birla - 2