Aditya Birla Group eyes ‘bifocals’ for its diversified businesses, people policies

The group, with interests ranging from cement to fashion, is currently in discussions with consultants and advisers to devise a “bi-focal" strategy, according to industry executives familiar with the conglomerate’s plans.

Under this dual strategy, older businesses such as cement and textiles will be subject to one set of policies, and newer ventures may operate under a different set of guidelines.

The business house founded in 1857 has over the years ventured into segments such as paints, jewellery, and fashion that require a different approach from its legacy businesses.

This may also call for changes in employee policies so that the group can attract talent more suitable for specific customer segments, said industry executives aware of the developments.

The Aditya Birla Group, according to these executives, has already started implementing some initial changes under Ashok Ramchandran, who took charge as group director of human resources in January.

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“The group is evaluating if a ‘bi-focal strategy’ can be put into place where older businesses like cement, textiles, telecom, etc., need a certain kind of outlook, while the newer businesses like paints, jewellery, renewable, digital platforms" will need a different approach, said a senior industry executive, declining to be identified, as did the others. 

Ramchandran, who has been with the conglomerate since 2015, said the group reviews all people processes periodically, and that “no major review of all policies is underway at this stage".

A shift to external hires

In 2016, the Aditya Birla group, which employs more than 187,000 employees of over 100 nationalities, had drawn up a policy nicknamed ‘2x2x2’ to assign some of the best roles to high-potential employees who had worked in at least two geographies across two functions and two businesses. 

That was part of a five-year plan to build an internal talent pipeline. The group later decided to select senior managers from within and not rely on hiring from the market. It had also created a database of employees highlighting their expertise in areas such as mergers and acquisitions and project launches for more efficient skill-mapping.

The 167-year-old Aditya Birla Group is now looking to create a swifter process for decision-making, said a second industry executive. 

“The company has started initial rounds of discussion on whether structures within the group can be simplified, which, in turn, will help in the decision-making process," this executive said.

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Ramchandran said while the group has a “well-oiled system" for hiring experts, speed-to-market will be a crucial aspect.

“At the Aditya Birla Group, we have always practised responsible empowerment of our businesses…," Ramchandran said. “This includes the design of the organisation, structures, and talent onboarding, internal movements from within the group, and external hiring balance. Speed-to-market is one of the aspects at the core of decision-making."

Next target: Improving brand

Meetings with industry advisers and senior management have highlighted the need to spruce up the group’s brand image and improve the conglomerate’s market capitalisation, according to the industry executives. 

The group crossed a significant milestone earlier this month, reaching a market cap of $103 billion. Only Reliance Industries Ltd, Tata Consultancy Services Ltd, and HDFC Bank Ltd are ahead in terms of market cap, among listed Indian companies.

“Market cap is an outcome of many factors, I guess," the HR director said. “We are happy that the wider market recognises our brand in terms of consistent results, ways of working, resilience, and ambitions ahead."