Reliance Industries: Going the Startup Way — The Future of Organisations (Part III)
This article is a continuation of: The Future of Organisations: What sets Amazon & Reliance apart from companies like GE?
In 2008, a couple of years after Reliance entered the retail market, I joined the company, and experienced the growth of this Indian behemoth, first-hand. I have always been a firm believer that the story of Reliance Industries makes for an impactful case study of growth and success, a classic example of diversification done right, and reading the market well. Reliance always stayed two steps ahead of the game because it could effectively predict India’s needs and customer demands, and where there was a gap in requirement and supply.
If you put aside the numbers, and wilfully choose to forget the jargon, it’s a beautiful story. It’s the story of how one man dreamt of building the nation’s largest company and succeeded.
Since its inception in the 1960s as a polyester business named Reliance Textiles Industries Limited, Reliance has ventured into multiple avenues — and succeeded each time. Its biggest testimony to success was when its patriarch, the unrivalled Dhirubhai Ambani, made an initial public offering (IPO) in 1977 and the issue was oversubscribed seven times. Renamed as Reliance Industries Limited in 1985, the company experienced geographical expansion, a steady growth and increasing revenues until the 1990s, when it became the largest polyester producer in the world. Further diversification came in 2009 when Reliance began production of hydrocarbons. Reliance gas was long in existence by then and going strong.
Expansion on a massive scale came after. Reliance broke into the mobile phone industry with a big bang in 2002, immediately gaining momentum with the public, because it was playing in a field dominated by foreign brands that came at high prices. The same strategy of affordability was duplicated a decade later with its revolutionary Jio, giving away subscriptions free for the first six months.
Already popular as a people’s champion, Reliance closed the gap even further with its entry into the retail sector, launching Reliance Fresh, Reliance Trends, Reliance Footprint and Reliance Digital. Today, it is a second fastest growing retailer in the world. Its remarkable growth was complemented by its petrochemical dominance. Reliance has always been a company of many firsts and it somehow always connects with India’s massive middle class.
The biggest highlight of its success story is the fact that Reliance was the first Indian firm to achieve $200 billion market valuation in September 2020. It breaks into the list of the Top 50 most valued firms in the world.
Reliance: The Legacy Startup
From its headquarters at Mumbai, Mukesh Ambani, Chairman of Reliance Industries Limited, runs India’s biggest startup. The company that is responsible for the massive disruption of the Indian telecom industry and for setting a new standard in quality and affordability, has established new norms in organisational culture too. With minimum hierarchy in new projects, Reliance works like a startup.
Innovation is another aspect where Reliance has mastered the startup way. And like Amazon, its ventures in unknown territories have successfully transformed the company from a small textile trading firm into India’s largest private sector firm, and a Fortune 500 company. Conquering the fields of oil and petroleum, textile, telecommunications, e-commerce and now starting a digital revolution in India, continuous innovation and diversification has made Reliance a force to be reckoned with.
Three years after its launch, Jio integrated into a newly formed digital business, Jio Platforms. While other companies were struggling to survive the COVID crisis, Jio Platforms was focused on growth; it raised over $20 billion between April and July 2020 from corporate ventures, private equity and sovereign wealth funds including Google, Facebook and Qualcomm.
JioPlatforms, in partnership with tech startups and giants like Facebook and Google, has the blueprint to transform India into a digital society. With a suite of tech capabilities, it is designed to accelerate growth in digital businesses. More than 20 tech startups that Reliance has bought or has invested in, are working round the clock to enhance the company’s core digital offerings, creating an ecosystem of apps to give India a chance in the global digital revolution.
Mukesh Ambani, during the launch of JioPhone, told the audience, “Reliance democratised the equity culture in the past. Now, Jio will democratise the digital culture in India. Digital life will no longer be the privilege of the affluent few.” Reliance conquered a very large market — the Indian lower and middle classes are gigantic — with innovation and a lot of trust, the same strategies that helped Jio sweep through the Indian telecom sector like a tsunami.
Suffice to say that innovation with a higher purpose is what’s required today. Business growth fuelled with a purpose beyond profits is no longer a secret strength or a magic arrow in the quiver. It is, in fact, a prerequisite in today’s highly aware world.
In my book, The New Age Organisation, I identify five fundamental forces driving the change and offer actionable practices on how organisations should respond to the changes, to sustain and achieve business growth.
Aravind Chinchure is the author of a new book, The New Age Organisation: How to Navigate Rapid Disruption and Lead in the Fourth Industrial Revolution, which offers a new organisational framework and a new leadership approach to build agile and responsive organisation.
