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Latha Venkatraman

Mr Adi Godrej, Chairman, Godrej Group.

THE Eastern Express Highway running into Mumbai through the eastern suburbs bears testimony to the strength of the Godrej group, which has straddled the Indian industrial scene for over 100 years.

The Rs 4,500-crore group may no longer be on the fast-lane, but it still clocks a steady pace. Today, the bustle inside the sprawling Godrej complex at suburban Vikhroli may have quietened. But the group's activity has far from slowed down.

Godrej is transforming itself to tackle the challenges brought on by a changed market scenario: There is concern about various issues — Increasing competition from domestic companies and multinational corporations, sustainability of profits, cost reductions, brand positioning and focus on new growth areas. That it has succeeded to a great extent is clear from the fact that at a time when the FMCG (fast-moving consumer goods) sector showed de-growth, Godrej Consumer Products Limited (GCPL) sailed through with consistent growth in its margins.

Godrej has had a range of businesses but over the years it has narrowed its focus. Engineering, marketing and distribution have been the core strengths of the group. For over 50 years, the Godrej brand has sold various products ranging from locks, furniture and security, to consumer items and some others.

While most other leading business groups got into such sectors as power, telecom and insurance, Godrej desisted from making forays into these areas. But, now, a clear shift is happening at Vikhroli, the headquarters of the group. Increasingly, the group is getting out of manufacturing and focussing more on the consumer. "We are putting greater emphasis than in the past on human resource and talent development," Mr Adi Godrej, Chairman, Godrej Group, told Business Line in an interview in late 2002.

Within the group, several initiatives are on. A young executive board was put in place, a think-tank in the group was involved in strategic planning, and greater attention went to human resource and talent development.

All these changes may have been triggered by criticisms the group faced. Employees who quit Godrej remember it as a good place to get initiated but moved on in the absence of motivation.

The stock exchanges panned various Godrej companies and one of the listed outfits, Godrej Foods, was dragging down the overall profitability of the group. Mr Adi Godrej resolved to change all this because things began to move after he took over the reins.

A corporate restructuring process commenced. Godrej Soaps Ltd demerged into two entities — Godrej Consumer Products Limited and Godrej Industries Limited; the foods business of Godrej Foods Ltd was hived off and taken over by Godrej Industries.

Mr Adi Godrej also set about changing the image of the company. " Godrej touches lives of millions of Indians everyday. To them it is a symbol of enduring trust and reliability in a changing world," the group's Web site quotes him. The company has embraced globalisation in its truest sense, he says, as it has manufacturing facilities in Malaysia, Indonesia and Vietnam.

The group may have had to battle stringently in business, but it has a prominent position where environment matters are concerned.

Not only did the founders conceive the idea of an industrial township at Vikhroli but also laid the foundation for a green, bio-diversified environment.

Many units have moved out from Vikhroli but the sprawling complex remains a veritable botanical garden sheltering numerous birds. The Godrej Mangrove Project is yet another environment conservation project of the group. This project is happening on the 2,000 acres the group owns.

The Godrej School is also another example of corporate liberality. Students of workers and officers mingle in an atmosphere that is completely different from the usual school. Godrej will remain an important part of Mumbai.

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