Mukesh Ambani recently said that India can become a $ 40 trillion economy by 2047. For his conglomerate he unveiled mega investment plans totaling $ 2.75 trillion and outlined a succession plan, positioning the conglomerate for its next growth phase to double the group’s value by 2027.
Ambani has also said the company would invest ₹75,000 crore in its O2C business over the next five years to set up India’s first carbon fibre factory and to add capacity in other areas such as polyester and vinyl. The group is also looking to accelerate its commitment to invest 75,000 crore towards establishing a fully integrated new energy manufacturing ecosystem in Jamnagar.
As Arijit Barman has succinctly analysed in ET Ambani has become Alibaba and Alphabet of India overseeing a diverse empire of refining, telecom, retail, internet, media and sport.
Looking at how he planned the growth of the legacy he inherited it is just not possible to miss how he has followed the tenets of strategic thinking and execution posited by Hamel and Prahalad three decades ago.
To start with,
The strategist’s goal should not be limited to find a niche within the existing industry space but to create new space that is uniquely suited to the company’s own strengths—space that is off the map.
Next, Companies that have risen to global leadership over the past 20 years invariably began with ambitions that were out of all proportion to their resources and capabilities.
These firms foster the desire to succeed among their employees and maintain it by spreading the vision of global leadership.
Further, the goal of strategic intent is to fold the future back into the present. The important question is not “How will next year be different from this year?” but “What must we do differently next year to get closer to our strategic intent?” Only with a carefully articulated and adhered to strategic intent will a succession of year-on-year plans sum up to global leadership.
How does his ambitious foray into green hydrogen within a decade fit in so well in the point above?
Strategic intent is like a marathon run in 400-meter sprints. One year the challenge might be quality, the next it might be total customer care, the next, entry into new markets, and the next, a rejuvenated product line.
The journey so painstakingly charted over the past decade and the coming one is clearly in line with the framework of Hamel and Prahalad.
Finally, the essence of strategy lies in creating tomorrow’s competitive advantages faster than competitors mimic the ones you possess today.
That means carefully managing competitive engagements so that scarce resources are conserved and fundamentally change the game in ways that disadvantage incumbents: devising novel approaches to market entry, advantage building, and competitive warfare. For smart competitors, the goal is not competitive imitation but competitive innovation, the art of containing competitive risks within manageable proportions.
Not only Ambani has demonstrated the acumen with his personal leadership but has planned a succession roadmap maintaining the continuity of quality leadership.