HARSH REALITIES – THE MAKING OF MARICO
Authors: Harsh Mariwala and Ram Charan
Reviewed by Raman Jokhakar, Chartered Accountant
The unique cover of the book strikes you when you first hold it in your hands. It’s a transparent plastic jacket where part of the title is printed on the plastic jacket and part on the hardbound cover. ‘Transparency. Always. The very basis of my life. My work’ writes Mr. Mariwala on the second cover. And that is what the book is really about. The wordplay of the title – mixing maker with Marico – makes the book more enticing for the reader.
I was delighted to one day receive an email from Mr. Harsh Mariwala (HM) mentioning about the release of his book and requesting my address to send it. He had graced the BCAS Annual Day celebrations as the Guest Speaker on 6th July, 2016 when my term as the President of the Society was coming to a close. In his email he described (t)his book as: ‘It encapsulates my journey, the challenges I faced, the risks I took and learnings from not only my successes but, more importantly, my failures. It is meant for entrepreneurs, business leaders, professionals & students who will relate to the Marico story, and the learnings therein.’ I was delighted to request him to sign and send the book, to make it a collectable although I would have loved to buy it and have the author sign it in person if it were not for the Covid times.
The book is divided into 21 chapters and has more than 200 pages. It tells the tale of ‘what determines success’, ‘scaling up’, ‘about failing’, ‘creating right to win on a perpetual basis’ and not only building a business but ‘impetus to give back to the society. To make a difference.’ In other words, almost everything one would dream of going through in one’s lifetime.
The book is co-authored by his coach Ram Charan, who summarises, analyses, unpacks, distils the wisdom at the end of the chapters.
Like most businesses around the world, Marico had roots in a large joint family business that was cohesive and bonded. Although HM was amongst the eight boys of his generation and eldest grandson of the senior-most Mariwala, he and other cousins felt difficulties in realising their business aspirations within the model created by the previous generations. They sat down and decided to carve out the family business of Bombay Oil Mills into subsidiaries where they could find space for their vision and aspirations. A great process to amicably split yet stay tied, and chart one’s own course…
We all know that some Marico brands are household names in India for a few generations now. Those who grew up in the 1990s know of the strong buzz Marico advertisements created, through shock, attention-gripping commercials.
Although I cannot write about everything nor summarise all chapters, I have tried to share the juice from important themes and key learnings. An important chapter that grabbed my attention was about hunting for talent. How to be a gravitational power that would attract the best, make the organisation that would survive him. HM shares how a Chief HR Officer was his first acquisition target. The chapter chronicles hiring people who knew much more than he did. He notes that this strategy paid off when Marico’s turnover grew from Rs. 80 crores to Rs. 648 crores in ten years from 1990 to 2000, giving a CAGR of 24%.
The chapter on Shared Vision and Unique Culture covers setting the tone across the organisation. HM was particularly influenced by reading stories of successful companies and biographies of well-regarded business leaders. The lessons from those stories he MARinated with his own thoughts and crafted the core beliefs of the company which eventually took shape as 3Ps – People, Products and Profits. It is fascinating that ideas of Dharma from Bharatiya ethos moved through these ideas. I remember having visited HM’s office and seeing Sanskrit verses etched on the walls of the passageway leading to his office. The author shares in detail the principles and practices of Marico and how it went on to spot the gaps between values and practices to ensure that its people walked the talk. A 5E model of continuous improvement was set up to sustain and enhance culture, which consists of Educate, Engage, Enable, Evaluate, and Evolve. In short, culture is taken as a competitive advantage and a force that drives decisions, actions and behaviour on a perpetual basis.
The middle section of the book walks you through the brass tacks of transformation, challenges… and growth. Inspiring stories one would love to read: of building brands like Parachute (the most copied) and Saffola; of agony of family separation, and Organising for Growth and Scaling (Marico’s Rs. 236-crore market cap in 1996 multiplied 190 times by 2020). The episode of Hindustan Lever (HL) wanting to take over Marico is full of movie material where Dadiseth threatened to turn Marico into history if HM didn’t sell out. This was the time when Coca Cola had bought Thums Up. But how nimbleness and strategy worked for Marico is to be read from the book (and not here) when post the war for market, Parachute came out stronger against the giant HL, gaining 4% additional market share to 52%, Marico gaining better strategic health and reputation. An important lesson that must be pointed out is about having a coach in Prof. Ram Charan at various stages. The ideas of building a brand extension in Saffola and making it suit Indian taste buds make some obvious yet innovative stories where western breakfast brands have not clicked. The overseas expansion theme has several anecdotes where Marico captures 82% market share in Bangladesh, and where the Unilever director wants to put their soaps in shops that sold Parachute although Unilever were in Dhaka since the 1800s.
The chapter on managing the capital markets is particularly ingenious. About splitting the Kaya business out, to having cartoons along with newspaper reports and keeping cheeky humour alongside reporting on performance. HM’s approach to using Board and governance as a competitive advantage where he would pre-empt practices before they were mandated by law. HM selected competencies and then selected Board members who fit the bill.
Imagine a company that reached a value of Rs. 25,000 crores in 25 years and its scrip outperforming the FMCG index had to plan for the most contentious challenge – the future leadership where the founder had to give up the ‘cocaine’. A chapter deals with how the founder had to find people who had foresight, competencies, were steeped in organisational culture and purpose and who would enhance profitability, respect and growth. A tall order! HM did step back while handing over the hot seat to a non-family professional to assume that responsibility. This, in the words of the author, was the toughest call he had to make. The last two of three chapters take one through purpose beyond profit and personal social responsibility. Of numerous initiatives and investments. The final chapter lists out Milestones and Maxims that I would like you to read in the book. A rich list coming straight out of rich, wide and deep experience.
After reading the book, which is an easy read, one feels like having gone through a live life story of a man, his endeavours and a business. As HM writes in the end about his perpetual quest to do more, BE more and make a difference. The takeaways from the book are countless like the shades in a rainbow, and enlighten every reader, no matter which station of life she is at. By the time you reach the end of the book, you will get a feeling of your mind opening a bit more, just like a parachute which works only when open!
