GD Birla leadership Styles

04/04/2020 1 By indiafreenotes

Ghanshyam Das Birla (10 April 1894 – 1983) was an pioneering Indian businessman and member of the Birla Family.

Ghanshyam Das Birla was born on 10 April 1894 at Pilani village in Jhunjhunu district, in the Indian state then known as Rajputana, as a member of the Maheshwari Marwari community. His father was Raja Baldevdas Birla. In 1884 A.D. Baldeo Das Birla went to Bombay in search of new avenues of trade. He established his firm Shiv Narian Baldeo Das in Bombay in 1884 and Baldeo Das Jugal Kishore in 1897 in Calcutta. The firms started business in silver, cotton, grain and other commodities. He was succeeded by 4 sons, Jugal Kishore, Rameshwar Das, Ghanshyam Das and Braj Mohan. Ghanshyam Das was the most successful of the four brothers.

Business of Birla Family

Birla inherited the family business and moved to further diversify them into other areas. Of these, at least three contemporary family business groups existing in India today can trace their ancestry to him. Of these businesses, he wanted to turn the moneylending business into manufacturing. So he left for Calcutta in Bengal Presidency, the world’s largest jute producing region. There, he began “independently as a jute broker”. In 1918, he established Birla Jute Mills, much to the consternation of established European merchants, whom the biased policies of the British government favoured other than the local Bengali merchants. He had to scale a number of obstacles as the British and Scottish merchants tried to shut his business by unethical and monopolistic methods, but he was able to persevere. When World War I resulted in supply problems throughout the British Empire, Birla’s business skyrocketed.

With an investment of ₹5 million in 1919, the Birla Brothers Limited was formed. A mill was set up in Gwalior in the same year.

In 1926, he was elected to the Central Legislative Assembly of British India. He became the founding president of Harijan Sevak Sangh founded by Mahatma Gandhi in Delhi in 1932 .

In the 1940s, he ventured into the territory of cars and established Hindustan Motors. After independence, Birla invested in tea and textiles through a series of acquisitions of erstwhile European companies. He also expanded and diversified into cement, chemicals, rayon and steel tubes. Ghanshyam Das Birla during the Quit India Movement of 1942, had conceived the idea of organising a commercial bank with Indian capital and management, and the United Commercial Bank Limited was incorporated to give shape to that idea. UCO Bank, formerly United Commercial Bank, established in 1943 in Kolkata, is one of the oldest and major commercial bank of India.


The statue of Ghanshyam Das Birla at Golders Green Crematorium

Envisioning infrastructural development in his hometown, Birla founded the Birla Engineering College (rechristened as Birla Institute of Technology and Science in 1964) in Pilani and the Technological Institute of Textile & Sciences in Bhiwani among other educational institutions in 1943. Both colleges have evolved over the years to develop into one of India’s best engineering schools. Now Pilani also houses Birla Public School, a famous residential public school named after Birla’s family and a number of polytechnic colleges. The town of Pilani and the local population enjoy a highly symbiotic relationship with these institutions, thereby stepping towards realising Birla’s dream. TIT&S also evolved as the Center of Excellence in Textile based education and training. Moreover, G.D. Birla Memorial School, Ranikhet, a premier residential school has also been established in his honour by his son B.K. Birla and is today one of the best residential schools in the country and The Birla School in Kalyan, India was founded by his efforts with the collaboration of Kalyan Citizens’ Education Society (KCES).

In 1957, he was awarded India’s second highest civilian honour, the Padma Vibhushan by the Government of India.

There is a memorial to Ghanshyam Birla in Golders Green Crematorium, Hoop Lane, London. It comprises a large statue overlooking the gardens with an inscription. He died in 1983 at the age of 89.

Late GD Birla was a highly focused man with money. He could earn it, spend it, retain it and make the most useful utilization of it,” Shri Agarwala said. GD was a financial wizard. And he was a man with foresight. Shri Agarwala related an example of the initial stages of HINDALCO. The company was in collaboration with the third largest producer of aluminium in the world. “When we started, the capacity was 20,000 tonnes per annum. At the time the total production of India was only 10,000 tonnes. To start a company with such a high capacity at that time was not a simple task. Our budget was Rs. 20 Crores – a huge amount in 1956-57. GD asked us how we could utilize the funds economically and differently. We came out with a budget of Rs. 16 Crores and started operations of the plant in exactly Rs. 15.6 Crores,” he remembered and emphasized, “Money has to be valued.”

“GD would pay a lot of attention to finance. To arrange funds to the tune of Rs. 20 to Rs. 30 Crores was not a joke. There was no financial institutions, no LIC, no IDB, you could not approach foreign investors because they did not give to India, you could not borrow from the government, yet he could manage funds in such a way that no conditions were attached to it,” Shri Agarwala remembers.

Late G.D. Birla believed in grooming his own people. During those days, India had no B-Schools to do the job for him. He would personally train his people by assigning them work, directing them and making them work. “Whatever I learnt I learnt under him,” Shri Agarwala said, proudly, adding, “Today grooming being a crucial factor, we take the help of institutions. Fundamentals are the same: Focus on work, focus on financing, budget and complete the job on time. Utilize the resources available to the maximum extent,” he ended.