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INTRODUCTION

The Reliance Group is India’s largest business house with total revenues

being more than $22.6 billion. This is equal to 3.5% of India‟s GDP.

Reliance contributes to 10% of India‟s total indirect tax and 6% of her

total exports. Reliance network of exports spread out to more than one

hundred countries across the globe.

It is involved in oil exploration and

production, gas refining and

marketing, petrochemicals, textiles,

financial services, insurance,

power, telecommunications and

infocom initiatives. 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 names of Reliance and

DhirubhaiAmbani go hand in

hand.Dhirubhai built India’s largest private sector empire, Reliance, and

created an equity cult.Reliance gave new dimensions to India’s equity

culture. Till then the market had been dominated by financial institutions

but with Reliance coming into the picture thousands of retail investors

jumped into the fray by putting their trust in the name of Reliance. With

innovative instruments like convertible debentures from the 1980’s

Reliance became a hot favorite in the Stock Market. Reliance was the

pioneer Indian company to raise funds in the international markets.

The story of Reliance makes fascinating reading. During the 1950’s the

administrators of Yemen discovered that a lot of their currency, the Rial,

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was disappearing through Aden because of a young man placing unlimited

buy orders for Rials. The Rials, at that time, were made of pure silver and

was greatly in demand in the London Bullion Exchange. Dhirubhai bought

and melted the Rials and sold it to the London bullion traders. Within three

months his work came to a halt but by that time he had made few lacs.

In the 60‟s Dhirubhai returned to India and started Reliance

Commercial Corporation with a humble capital. The business was

related to the import of polyester yarn and export of spices.

The first address of Reliance was in Narsinathan Street in Masjid Bunder,

a small 350 sq ft joint with a telephone, table and three chairs and only two

assistants. The family too managed in a one room flat.

The fortunes of Reliance soon began to change. In 1966 the first textile

mill was set up at Naroda using polyester fibre. He branded his products

Vimal and thanks to intensive marketing, Vimal became a household

name. Financial retail outlets were set up where only Vimal brands were

sold. In 1975 a visiting World Bank team certified it to be excellent

even by the standards of the developed world.

The next step of Reliance was to enter the equity world. An equity cult

came to be created. Nearly 60,000 investors from all parts of India placed

their trust in Reliance IPO in 1977. Rural Indians and first time investors

learnt to place its trust and money in the name of Reliance.

In 1982 Reliance Industries came up against a rights issue about partly

convertible debentures. It was rumored that Reliance was making all

efforts to see that their stock prices did not fall by even an inch. Ready to

strike, a Bear cartel consisting of a group of stockbrokers from Calcutta

began to short sell Reliance shares. Another group, friendly towards

Reliance began to buy the short sold shares on the Bombay Exchange. The

Bears were confident that the Bulls would soon run out of cash and be

prepared for an understanding under the ˜badlaâ-trading scheme prevalent

in the Bombay Stock during that time. But the tables came to be turned in

favor of Reliance. Dhirubhai himself provided the required cash when the

Bulls demanded a physical delivery of shares. The net result was that

Reliance shares shot up from INR 152/- to 180/- within a few minutes.

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The market was in uproar withDhirubhai as the uncrowned king. The

Bombay Stock Exchange came to be closed for three full days. Authorities

intervened and brought down the unbadla rate to 2/- with a ruling that the

Bear cartel would have to deliver the shares within the next few days. The

Bears bought Reliance shares from the market at higher price levels and

most probably Dhirubhai himself supplied these shares and earned a

healthy profit from the great adventure.

Questions naturally arose around Reliance. How could a yarn trader

within a few years cough up such huge amounts of cash during a

crisis? Parliament began to face queries. The Finance Minister gave the

information that a non-resident Indian had invested nearly 220/- million

INR in Reliance from 1982/83. These had been channelized through many

companies all registered in the Isle of Man. The peculiarity was that all the

owners had the common surname of Shah. However, Reserve Bank

investigations did not find anything wrong done by Reliance and its

friends.

Keeping its core in petrochemicalsReliance soon diversified its activities

to telecommunications, information technology, energy, power, retail,

textiles, infrastructure services, capital markets and logistics. BBC

described it as a business empire with an estimated annual turnover of

$12bn, and an 85,000- strong workforce. Reliance has the distinction of

being the only public limited company whose many annual general

meetings had to be held in stadiums with more than 350,000

shareholders in attendance.

Success creates jealousy and Reliance had to suffer its share. NusliWadia

of Bombay Dyeing group was once the biggest competitor of Reliance.

Wadia was known for his clout in political circles during the time when

the economy had not been liberalized. Competition took an ugly turn when

during the seventies Wadia got a permission from the then Janata Party

ruled government to build a DMT (Dimethyl Terephthalate) plant. Then

RamnathGoenka of Indian Express turned his pen against Reliance. It

seemed that Goenka was using a national newspaper for his own personal

vendetta. But despite everything people did not lose faith in Reliance.

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Reliance ran into rough weather also with the V.P.Singh government. The

license for importing Purified Terephthalic Acid was cancelled. This was

essential as a raw material for manufacturing polyester yarn.

Dhirubhai died in 2nd July 2002 leaving behind at the helm of Reliance his

two sons Mukesh and Anil, wife and two daughters. His funeral was

attended not only by big business and politicians but also by thousands of

ordinary folks. He is an example of what a common person can do to help

himself as well as the economy of his country.

At the time of his death the Reliance group had a gross turn over of

INR 75,000 crores from 70 crores in 1976/77. In 2003 Government of

India issued a postal stamp (denomination 5/- INR) in Dhirubhai’s honour.

Reliance began to flow through two channels after the death of Dhirubhai.

Differences broke out between his two sons over ownership issues as well

as private matters. It was expressed that this would have no impact on the

functioning of the company it being a company managed aggressively by

professionals. This is of great importance to the Indian economy as a

whole. The wife of Dhirubhai, Kokilaben mediated for her sons.

Mukesh was awarded Reliance Industries and IPCL and this group came to

be known, as Reliance Industries Ltd. Anil became head of Infocomm,

Reliance Energy and Reliance Capital known as the Anil

DhirubhaiAmbani Group (ADAG).

The pages of the book called Reliance thus continue to be written as it

meanders through Time.

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ABOUT DHIRUBHAI AMBANI

DhirajlalHirachandAmbani , better known as DhirubhaiAmbani was an

Indian business tycoon who founded Reliance Industries in Mumbai with

his cousin. Dhirubhai has been among the select few to be figured in

the Sunday Times list of top 50

businessmen in Asia. His life has

often been referred to as a true

"rags to riches" story. Ambani took

his company public in 1977, and by

2007 the combined fortune of the

family was $60 billion, making the

Ambani's the second richest family

in the world. Ambani died on July

6, 2002.

Dhirubhai H. Ambani, the Founder

Chairman of Reliance Group. He is

regarded as an icon for enterprise in

India. A man far ahead of his times, he epitomized the dauntless

entrepreneurial spirit 'dare to dream and learn to excel'. He dared to

dream on a scale unimaginable before in Indian industry.

DhirubhaiAmbani alias DhirajlalHirachandAmbani was born on December

28, 1932, at Chorwad, Gujarat, into a Modh family. His father was a

school teacher. DhirubhaiAmbani started his entrepreneurial career by

selling bhajiasto pilgrims in Mount Girnar over the weekends. He moved

to Aden, Yemen after completing his matriculation at the age of 16. He

worked there as a gas-station attendant, and as a clerk in an oil company.

He returned to India in 1958 with Rs 50,000 and set up a textile trading

company.

Dhirubhai started off by working with a firm in Yemen 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

in Naroda industrial area of Ahmedabad. He founded Reliance

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Industries in 1966, and today, the company, with over 85,000 employees,

provides almost 5% of the Central Government's total tax revenue.As of

2012, Reliance Industries was listed among top 100 firms in Fortune

500 list of world's biggest companies by revenues.

Majin Commercial Corporation

DhirubhaiAmbani returned from Yemen to India and started "Majin" in

partnership with ChampaklalDamani,his second cousin, who used to be

with him in Aden,Yemen. Majin was to import polyester yarn and export

spices to Yemen. The first office of the Reliance Commercial Corporation

was set up at the Narsinatha Street in Masjid Bunder. It was a 350 sq ft

(33 m2) room with a telephone, one table and three chairs. Initially, they

had two assistants to help them with their business. During this period,

Dhirubhai and his family used to stay in a one-bedroom apartment at the

Jai Hind Estate in Bhuleshwar, Mumbai.

In 1965, ChampaklalDamani and DhirubhaiAmbani ended their

partnership and Dhirubhai started on his own. It is believed that both had

different temperaments and a different take on how to conduct business.

While Damani was a cautious trader and did not believe in building yarn

inventories, Dhirubhai was a known risk-taker and believed in building

inventories, anticipating a price rise, and making profits.

The life journey of the most enterprising Indian entrepreneur is

reminiscent of the rags to riches story. He is remembered as the one who

rewrote Indian corporate history and built a truly global corporate group.

His life and achievements prove that backed by confidence, courage

and conviction, man can achieve the impossible.

He started his first textile mill at Naroda, near Ahmedabad in 1966 and

started the brand 'Vimal'. He built India's largest private sector

company, Reliance India Limited, from a scratch. Over time he

diversified his business into a core specialization in petrochemicals with

additional interests in telecommunications, information technology,

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energy, power, retail, textiles, infrastructure services, capital markets, and

logistics.

DhirubhaiAmbani is credited with revolutionizing capital markets in India

by attracting millions of retail investors in a market till then dominated by

financial institutions. From nothing, he generated billions of rupees in

wealth for those who put their trust in his companies. Due to his efforts

and with the help of innovative instruments like the convertible debenture,

Reliance quickly became a favorite of the stock market in the 1980s. In

1992, Reliance became the first Indian company to raise money in

global markets. Reliance also became the first Indian company to

feature in Forbes 500 list.

From a humble beginning, he went on to create an enviable business

empire within a span of just 25 years. Under

DhirubhaiAmbani'sOutstanding Visionary Leadership, the Reliance

Group emerged as the largest business conglomerate in India, and carved

out a distinct place for itself in the global pantheon of corporate giants.

The Group's track record of consistent growth is unparalleled in Indian

industry and perhaps internationally too. Today, the Group's turnover

represents nearly 3 per cent of India's GDP. The Reliance Group is a

living testimony to Dhirubhai's indomitable will, single-minded dedication

and an unrelenting commitment to his goals.

Besides being firmly rooted in traditional Indian values, Dhirubhai was

also the quintessentially modern man, the man of the new millennium.

This was clearly reflected in his passion for mega-sized projects, the most

advanced technology and the highest level of productivity. The corporate

philosophy he followed was short, simple and succinct: "Think big.

Think differently. Think fast. Think ahead. Aim for the best". He

inspired the Reliance team to do better than the best—not only in India but

in the world.

The number of revolutionary precedents set by ShriDhirubhaiAmbani is

legion. His unique vision redefined the potential of the Indian corporate

sector as he challenged conventional wisdom in several areas. He was

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probably the first Indian businessman to recognize the strategic

significance of investors, discover the vast untapped potential of the

capital markets and channelize the same for the growth and development

of industry. He was supremely confident that finance would never be a

constraint in executing his projects because, as he said proudly, Indian

investors would provide him with the necessary resources. And the

investors never let him down.

DhirubhaiAmbani succeeded in creating an investor base of historic

proportions for the Reliance Group. He was able to create an unbreakable

bond of implicit trust between him and his shareholders, who placed their

savings in his care. He worked with unflinching sincerity to get them the

best returns. Thereby, he brought happiness and prosperity into the homes

of millions of investors. For him, his people were his most important asset.

He scouted around for the best and most talented professionals, nurtured

them and continuously propelled them to aim for still higher goals.

Dhirubhai visualized the growth of Reliance as an integral part of his

grand vision for India. He was convinced that India could become an

economic superpower within a short period of time and wanted

Reliance to play an important role in realizing this goal. His actions were

inspiration for others. Whatever he did became a standard for others to

follow. His sterling leadership qualities, remarkable foresight,

uncompromising pursuit of excellence, humility, prodigious capacity to

motivate and trust people will continue to guide and inspire future

generations.

Truly, men like DhirubhaiAmbani are rare. They come gifted with the

power and the vision to change the destiny of nations, to alter the course of

corporate history. They are the empire builders, the stuff that legends are

made of. Some of his notable quotes are: "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."; "Meeting the deadlines is not good enough,

beating the deadlines is my expectation."; and "Don't give up, courage is

my conviction."

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DhirubhaiAmbani won many words and accolades during his life. He was

named the Indian Entrepreneur of the 20th Century by the

Federation of Indian Chambers of Commerce and Industry (FICCI).

In June 1998, he was awarded the Dean's Medal by The Wharton School,

University of Pennsylvania, for setting an outstanding example of

leadership. A poll conducted by The Times of India in 2000 voted

him"greatest creator of wealth in the century".

In November 2000, he was conferred the 'Man of the Century' award by

Chemtech Foundation and Chemical Engineering World for his

contribution to the growth and development of the chemical industry in

India. He was lauded for his dynamic, pioneering and innovative genius.

His success story fired the imagination of the younger generation of Indian

entrepreneurs, business leaders and progressive companies. He was an

icon for them, a role model to be emulated.

DhirubhaiAmbani died on July 6, 2002 at Mumbai after suffering a brain

stroke. His legacy is being carried on by his sons Mukesh and Anil.

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AMBANI-AN IDEAL ENTREPRENEUR

CREATIVE An entrepreneur must be very creative so that he can bring

something new into existence in the business. Creativity is the pre-

requisite to innovation. Entrepreneurs must be creative in order to generate

ideas trough the creative process and in the process creating business

opportunities.

DhirubhaiAmbani

was such a creative

thinker that he actually

made people 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 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.

"Think big, think fast, think ahead. Ideas are no one's monopoly"

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Dhirubhai's Creativity not only helped his company but also the

country by 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.

MENTAL ABILITY

An entrepreneur must be intelligent in

order to analyze the various problems that the

business faces and the situations that arise. He

should be able to anticipate the changes in

order to deal with the problems.

Dhirubhai was an intelligent thinker and planner so much so that

when he 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 (brand created by Dhirubhai Ambani) to

penetrate through A and B class cities and semi-urban neighbourhoods

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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.

"Pursue your goals even in the face of difficulties, and convert adversities

into opportunities."

HUMAN RELATIONS

It is very important for an entrepreneur to maintain good relations

with not only its customers but also with its employees. He has to motivate

his employees in order to perform their jobs well and increase their

efficiency and for this he requires emotional stability, personal relation and

tactfulness.

Dhirubhai Ambani has been successful in manufacturing world-class

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.

"We bet on people."

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After 1977, when Reliance went public, Dhirubhai’s 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 had generated so muchconfidence in its Shareholders

for the company that 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 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.

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INNOVATION Innovation is one of the most important instrument of

entrepreneurship. Entrepreneursinnovate. They always try to innovate by

creating new and different values in order to create customer satisfaction

and win their confidence.

He has always been an innovator in the financial market. He

innovated and reintroduced successfully concepts like partial convertible

bonds, fully convertible bonds etc.

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.

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 yarn, oil and gas exploration

and production, refining and marketing of petroleum, textiles, power,

telecom services, information management and financial services.

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

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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

DYNAMIC

Along with innovation an entrepreneur also must be dynamic so as

to create prosperity he needs to change the business strategy and product

mix in order to stimulate steady growth. He will always try to solve the

problem rather than running away from them.

He always followed the rule to be the pioneer to do anything. He

would just grab an opportunity that would come up because of some

government policy changes and would implement it successfully.

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.

He believed not in meeting

demand but in creating demand.

He always produced in large

quantities. He was of the opinion

that customer should be provided

with best quality goods at the

lowest price.

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Moreover Dhirubhai as opposed to most other leaders wasn’t expert

in only one field. He was a manufacturing as well a marketing whiz. He

knew how to offer the right product mix, identify markets and establish

viable distribution structure, which holds true for one of his famous brand

Vimal.

He always had the Dynamism and Confidence in Futureand was

always ready to go against all odds. He always believed in himself. He

has always believed that his first responsibility is towards his company’s

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.

LEADERSHIP

An entrepreneur is a leader. Leadership is the basic quality of

entrepreneur. His leadership can seen through personal relationship, mode

of handling problems

generating resources

and taking others in

his own strides.

The managerial

practices in Reliance

were all affected

completely by the

leadership style of its

founder. The great success story of Reliance can be completely attributed

to the style of management brought in by DhirubhaiAmbani.

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Dhirubhai has been an opportunist right from his childhood. All he

needed was the whiff of a business opportunity and he was off to tap it.

Dhirubhai has always shown all the critical leadership qualities. He would

always grab an opportunity and strike on it.

TEAM BUILDING

An ideal entrepreneur is one who has the ability to build a team. This

team has a common purpose and is focused on achieving this purpose. A

good team shares its knowledge competency and goals.

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 doesn’t

run his business but his

business leaders do it.

DhirubhaiAmbani

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

He also empowered his managers by giving authority to them to

work independently to work independently he had belief in the capabilities

of his people. This has grown to become the core of the Reliance group’s

HR policy of staff recruitment and maintenance.

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MOTIVATION

A successful entrepreneur must be motivating the behaviour towards

the accomplishment its goal. He takes calculated risks and accept

challenges to do something worthwhile.

"Our dreams have to be bigger. Our ambition higher.Our commitment

deeper.And our efforts greater. This is my dream for Reliance and for

India."

Money is not a product by itself,

it is a by-product, so don’t chase

it

This was a belief by which

Dhirubhai lived all his life. For

instance when he briefed me

about setting up Mudra, his

instruction was clear: ‘Produce

the best textile advertising in the

country,’ he said.

He did not breathe a word about profits, nor about

becoming the richest ad agency in the country. Great advertising was the

goal that he set for me. A by-product is something that you don’t set out to

produce. It is the spin off when you create something larger.

When you turn logs into lumber, sawdust is your by-product and a

pretty lucrative one it can be too! It is a very simple analogy but

extremely effective in driving the point home. Work toward a goal

beyond your bank balance.

Success in attaining that goal will eventually ring in the cash. For instance,

if you work towards creating a name for yourself and earning a good

reputation, then money is a logical outcome.

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People will pay for your product or service if it is good. But if you get

your priorities slightly mixed up, not only will the money you make

remain just a quick buck it would in all likelihood blacklist you for

good. Sounds too simplistic for belief? Well, look around you and you will

know exactly how true it is.

He was not an MBA. Nor an economist. But yet he took traditional

market theory and stood it on its head. And succeeded.

Yes, at a time when everyone in India would build capacities only after a

careful study of market expectations, he went full steam ahead and created

giants of manufacturing plants with unbelievable capacities. [Initial cap of

Reliance Patalganga was 10,000 tonnes of PFY way back in 1980, while

the market in India for it was approx. 6000 tonnes].

No doubt his instinct was backed by years and years of reading, studying

market trends, careful listening and his own honed capacity to forecast, but

yet despite all this preparation, it required undeniable guts to pioneer such

a revolutionary move.

The consequence was that the market blossomed to absorb supply, the

consumer benefited with prices crashing down, the players increased and

our economic landscape changed for the better. The Patalganga plant was

in no time humming at maximum capacity and as a result of the plant’s

economies of scale, Dhirubhai’s conversion cost of the yarn in 1994 came

down to 18 cents per pound, as compared to Western Europe’s 34 cents,

North America’s 29 cents and the Far East’s 23 cents and Reliance was

exporting the yarn back to the US!

A more recent example was that of Mukesh Ambani taking this vision

forward with Reliance Infocomm [which is now handled by Anil Ambani].

In India’s mobile telephony timeline there will always be a very clear

‘before Infocomm and after Infocomm’ 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.

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In March 2006, it has touched 90 million! Yes, this was yet another

unusual skill of Dhirubhai‟s — his uncanny knack of knowing exactly

how the market is going to behave.

PROBLEM SOLVING

Every business faces its own set of problem. An entrepreneur is

expected to define the problem, gather information, identify various

solution, evaluate alternatives and select the best option, take option and

finally evaluating action taken.

Another incident that shows his

vision as a leader is that when

Reliance‟s 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 Dhirubhai’s vision, his

confidence, his dedication proper logistical planning and making available

all resources.

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COMMUNCATION ABILITY Another important characteristic requires by an entrepreneur to have

the ability to communicate effectively. An entrepreneur can achive great

success if he communicate effectively with his employes, suppliers,

dealers, customers and creditors.

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.

HONESTY In order to win over its customers, an entrepreneur has to be honest

with them. Honesty is something which creates huge confidence and wins

over the trust of customers and employees. However, in case of Dhirubhai

Ambani it is argued that he used illegal means, malpractices, bribing

and many unethical practices in order get the work done for his

company.

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It is said that Ambani used his connections with key politicians and

bureaucrats to obtain licenses and approvals for projects. He is also said to

have induced government intervention by offering bribes and using other

forms of lobbying prevalent in the US. Reliance was known to engage

politicians, journalists, and others to increase its sphere of influence. Some

business men described Reliance as "an out of control monster, a bubble

that would burst any moment." However, not all analysts would agree to

that. They felt that Dhirubhai was quick to recognize and exploit

opportunities. Dhirubhai believed that "business is nothing but a web of

relationships and obligations."Keeping this principle in mind, Dhirubhai

managed to create favorablecenters in all the important areas – among the

bureaucrats, the ruling politicians, as well as the media. These were the

areas where power vested.

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 NusliWadia, 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

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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 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.

Despite all of the controversies Dhirubhai Ambani faced, he still

had the trust and confidence of his shareholders and its shareholders

were about 25% of the total no. of shareholders India had during his time.

This showed that a majority of the Indian people believed that

DhirubhaiAmbani was honest to them.

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RISK-TAKING, DECISION-MAKING& COURAGEOUS

Entrepreneurs are persons who dare to take risks under conditions of

uncertainty and take very calculated and smart decisions. Risk bearing and

decision making requires absolute clarity in thinking and co-ordinated

actions. Every decision taken involves certain amount of risk to be

undertaken.

Fear of losing or rejection is something that every human has to

overcome in order to succeed. Fear is one of the common factor that make

people fail. Entrepreneurs must be courageous in order to overcome this

fear and face any

shortcomings in the

business.

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.

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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.

He was a man who always dreamed big. At a time whencapacities

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.”

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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

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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.