Dhirubhai Ambani and Leadership styles

04/04/2020 1 By indiafreenotes

Dhirajlal Hirachand Ambani, popularly known as Dhirubhai Ambani (28 December 1932 – 6 July 2002) was an Indian business tycoon who founded Reliance Industries. Ambani took Reliance public in 1977 and was worth $25.6 billion upon his death on 6 July 2002. In 2016, he was honored posthumously with the Padma Vibhushan, India’s second highest civilian honour for his contributions to trade and industry.

Early career

Dhirubhai Ambani was one of the sons of Hirachand Gordhanbhai Ambani, a village school teacher belonging to the Modh community and Jamnaben Ambani and was born in Chorwad, Junagadh district, Gujarat[1] on 28 December,1932. He did his studies from Bahadur Kanji school. In his youth, he joined the protests against the Nawab of Junagarh and organized many actions against his actions to join Pakistan after independence. It was a testament to his leadership skills.

In 1948, he left for the Port of Aden to work for A. Besse and Co. along with his brother Ramnikbhai. He later came to sell shell and Burmah oil products for the company. There is a famous story about how he once made a lot of money by melting the silver bullion and selling it as pure silver because he knew that the value of pure silver was much higher than the bullion thus was a precursor to his financial wizardry and acumen.

His friends described him as someone who was affable yet ambitious, cheerful yet had a ‘dark side’ because of his extreme ambition and risk taking. In Aden, his first son, Mukesh was born to him in 1957. Another son, Anil, was born two years later in 1959.

He left Aden in 1958 to try his hand at his own business in India in the textiles market .

Founding of Reliance Industries

Ambani returned to India and started “Majin” in partnership with Chambaklal Damani, his second cousin, who lived with him in 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.

At the tiny office, he began to make a team that would stay with Reliance for years, which includes Rasikbhai Meswani (his nephew), Ramnikbhai, Nathubhai (his younger brother) and two former schoolmates named Rathibhai Mucchala and Narottambhai Joshi. They usually worked around the streets of Pydhonie.

During this period, Ambani and his family stayed in a two-bedroom apartment at the Jai Hind Estate in Bhuleshwar, Mumbai. In 1965, Champaklal Damani and Dhirubhai Ambani ended their partnership and Ambani started on his own. It is believed that both had different temperaments and a different take on how to conduct business.[6] While Damani was a cautious trader and did not believe in building yarn inventories, Ambani was a known risk-taker and believed in building inventories to increase profit. In 1966 he formed Reliance Commercial Corporation which later became Reliance Industries on 08 May 1973.

He launched the brand ‘ vimal ‘during this time which sold polyester materials for saris, shawls, suits and dresses.

There are three different styles of leadership styles: democratic, autocratic and laissez-faire. Democratic leadership is when the leader is completely involved in the project and considers the opinions of his employees.

Autocratic leadership is when the leader controls the whole team and tells his employees what they have to do and not to do.

A laissez-faire leadership is when the leader allows his team to do whatever they want and it is completely “hands-off”.

I would classify Ambani as a laissez-faire leader although it is hard to say which type it was. He never said ‘no’ to anything and always tried out different things. He always thought big. He turned crisis into opportunities and thought about what he wanted to do next. The reason he is a laissez-faire leader is because he would mostly say ‘yes’ to any innovative approaches to expand the company.  Nonetheless, whenever he went to get licenses and legal permissions from the government, he researched everything about the project he was going to do. Furthermore, a laissez-faire leadership is best for skilled workers which was what Ambani did. He trained people to perfect particular skills so that they could run the company effectively.

Additionally, he is also a democratic leader because he always helps his employees whenever they needed it. He believed that “the manager (leader) should be a safety net for the employee”. He considered this belief to create greater results from the employee. From this it can be said he always wanted his employees to be happy and that he was approachable.

People have made a new leadership style for him: Dhirubhaism; because none of the other styles really fit the qualities he had. His kindness and modesty was what he was known for. He treated his employees like his friends and helped them whenever they needed it. He was never against dreaming and told people to dream big. However he told them to think about it realistically as well and try their best to achieve it. The most important leadership criterion for Dhirubhaism is optimism. He was constantly optimistic one of the reasons why he was so successful. His optimism led to fulfilling his dream which was to be successful. Despite the riches he had, he always saw himself as a small man.