Due to their own faults, several Indian business families went down
They decisively lost their position of eminence in the transition. It was a pity, since their founders were icons in their own right – Sir Shri Ram (Shriram Group), Gujar Mal Modi (Modi Group), Vijaypath Singhania (JK Group), K. C. Thapar (Thapar Group), R.P. Goenka (RPG Enterprises), H. Mafatlal (Mafatlal Industries Ltd.), Ramesh Poddar (Siyaram Silk Mills Ltd.), Rajan Nanda (Escorts Group), R. K. Dalmia (GHCL Ltd.) and T. P. G. Nambiar (BPL). The onset of the 1990s was a harbinger for a changed business environment. Industrial licensing was abolished, foreign investment regulations were liberalised, corporate & personal income tax rates were reduced, quantitative restrictions on imports were reduced, restrictions on the size of firms were removed, domestic firms got freedom to raise capital abroad and excise & custom duties were lowered. This led to decline of many business families.
We discuss a few instances. Escorts, which was led by Rajan Nanda, suffered heavily with its new ventures, particularly telecom, where they expanded very fast but could not bring the numbers. Just before the economy witnessed liberalisation, R. P. Goenka entrusted responsibility of the RPG Group (which houses companies like CEAT Tyres, Dunlop, HMV & Spencers Retail) on his sons, who went for organisational restructuring.
They decisively lost their position of eminence in the transition. It was a pity, since their founders were icons in their own right – Sir Shri Ram (Shriram Group), Gujar Mal Modi (Modi Group), Vijaypath Singhania (JK Group), K. C. Thapar (Thapar Group), R.P. Goenka (RPG Enterprises), H. Mafatlal (Mafatlal Industries Ltd.), Ramesh Poddar (Siyaram Silk Mills Ltd.), Rajan Nanda (Escorts Group), R. K. Dalmia (GHCL Ltd.) and T. P. G. Nambiar (BPL). The onset of the 1990s was a harbinger for a changed business environment. Industrial licensing was abolished, foreign investment regulations were liberalised, corporate & personal income tax rates were reduced, quantitative restrictions on imports were reduced, restrictions on the size of firms were removed, domestic firms got freedom to raise capital abroad and excise & custom duties were lowered. This led to decline of many business families.
We discuss a few instances. Escorts, which was led by Rajan Nanda, suffered heavily with its new ventures, particularly telecom, where they expanded very fast but could not bring the numbers. Just before the economy witnessed liberalisation, R. P. Goenka entrusted responsibility of the RPG Group (which houses companies like CEAT Tyres, Dunlop, HMV & Spencers Retail) on his sons, who went for organisational restructuring.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
and Arindam Chaudhuri (Renowned Management Guru and Economist).
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