Sushil Borde, Vice President of Innovation at Reliance Industries, is clear about the Indian conglomerate’s business goals: “Our ambition is to become the ExxonMobil, the Walmart and the AT&T of India.”
The $43 billion company already has businesses in petrochemicals, refining, telecom, energy, retail, and textiles.
“Reliance is India’s largest private sector company. We did not exist a few decades back. This has all been made possible on the back of extreme innovation,” Borde says. “In the process, we have reinvented many industries, we have changed the game of many business models, and we are now in the process of saying that the next wave of growth at Reliance will be even more innovation-led. To do that, we need to institutionalize innovation within the organization.”
We spoke with Borde about how the company is working to do that — and it isn’t just about putting one new program or set of processes in place.
“Some organizations think that putting processes of innovation in place will ensure a culture of innovation,” he says. “But they don’t focus on creating the environment for fostering innovative talent, and that’s where they fail.”
Our [Chairman’s] ambition is to [make Reliance] the ExxonMobil, the Walmart and the AT&T of India…And to do that, we need to institutionalize innovation. The Reliance InnoLeadship Center was established in 2008 to do exactly this — to look at organizational innovation…
We have also established the Reliance Innovation Council as an apex body that will guide the innovation ambition… The council’s role is to set the innovation agenda, to guide Reliance to really fold the future in, saying that “this is how the world is going to change in the next 5, 10, 15, 20 years.
Innovation Programs, Leaders, and Ideas
We look at innovation from an organizational point of view and not just from a product, process, or R&D point of view. What I mean by that is, what is it that we need to do to look at innovation and people? What type of innovation leaders do we need to take Reliance into that kind of future?
For example, the Beyonders program [at Reliance] is saying that in every organization, there are doers, in every organization there are creators… At Reliance, we have a different breed of people, the Beyonders, who not only create opportunities, but also make the impossible, possible. …Our aim is to create hundreds of Beyonders… [These individuals] identify innovation opportunities, we take them through a six-month process of systematically looking at an innovation process, and take the opportunity to implementation. In the process, we teach them how to discover new ideas, how to harness new innovative solutions, and how to define their opportunities and then take them into implementation.
To give you another example, we have what is called Mission Kurukshetra… The whole idea is “How does one democratize ideation in a diverse organization like ours?” We realized that we could not buy anything that was off the shelf or copy what other organizations had done in terms of creating such a platform because we are a different organization…So how does one design a program that is true to the organization and true to its DNA? How does one take into consideration the behavior of people in the organization?
We’ve been quite successful in deploying this program. The entire IT architecture was built in less than 90 days, the program was launched, and we currently have around 18,000 ideas in the last 19-20 months of its run. Tremendous value has been generated in the process for the organization, and what it has done essentially is engaged employees saying that “Innovation is important, my idea is important, and I can contribute creatively and innovatively to the growth of the organization.”
The Three Pillars of Innovation
Our innovation effort stands on three pillars.
The first one is the environment for innovation. This is where you have the freedom to ideate, the freedom to take risks, and so on.
The second pillar is the talent piece. We say, “Let us create talent with innovation skills, let us train them, and let us make sure that we reward them on their performance of innovation.”
The third pillar is the process pillar, where we say, “Let’s create processes for innovation to thrive in an organization.” So it’s the idea generation and selection process, commercialization process, portfolio management process.
This is really our definition of the culture of innovation. Our aim is then to populate this tripod with programs such as the Mission Kurukshetra, Beyonders, Leap, and others. In most companies, they will do one or two pillars and not necessarily all three. Most multi-nationals will say, “Let’s focus on the environment and not so much on talent and process. Most startups will focus on talent…Some organizations think that putting processes of innovation in place will ensure a culture of innovation, but they don’t focus on creating the environment for fostering innovative talent, and that’s where they fail.”
The Five Tenets of Innovation
Innovation for us is quite different from what innovation means to other organizations. Innovation in other organizations is probably more technology, more R&D, more new products. But we feel that innovation for us is really based on five tenets that we’ve lived by.
1. Challenge conventional wisdom. This we have done consistently over our existence right from when we wanted to build the largest polyester manufacturing plant in India. We were ridiculed, people saying “Polyester is the fabric of the rich. There is not enough demand in India…” Conventional wisdom says that, but we will challenge it and we will turn the whole economic model on its head. If there is not enough demand in India, how does one create demand by supplying low-cost, high-quality polyester to many people? That’s what we did. We have innovated that entire business model, and currently we are always in the first or second rank of polyester manufacturers of the world. In fact, we say that every second child in India wears a Reliance uniform to school…
2. We look at challenges as possibilities. The Mission Kurukshetra program, the ideation program, was born in 2008. This was during the financial meltdown. While some companies were packing up in the West, we were getting excited saying “This is our opportunity for coming out strongest through this global meltdown,” and to do that we said “Can we galvanize every employee to contribute innovatively to the growth of the company?” That’s where this program was designed, developed and deployed… Every adversity is an opportunity.
3. We make resources a non-issue. That is what drives innovation within Reliance. We say that the impact is more important than getting scared of how we are going to muster resources. For example, when we started building our first polyester plant, we had to raise money. We went to the banks in India, and the banks said “Well we don’t give money to people who don’t have money.” We went to other organizations with similar response. We said, “If that is the case, we will go to the people of India, and make them believe in our aspirations and our ambitions.” We started the equity cult in India, because at that time, not many Indians could participate in the stock markets. We really democratized equity markets to Indians. We made resources a non-issue.
Similarly, people are a non-issue. Beyonders is a way [to] say “If we have to create innovation leaders, we will create Beyonders of ourselves.”
Let’s not say that technology is an issue, or people are an issue, or funds are an issue.
4. Make trust an instinct. This itself doesn’t sound right because trust is always a long-drawn process, it’s relationship building. But for us, if we have to move fast, if we have to deploy businesses in half the time of the global standard, and with half the cost, we have to move very fast. And in that we have to make trust an instinct to make decisions.
5. Chase reverse cash flow. The fifth tenet is [about] how we execute our projects. [How can we] chase reverse cash flow, not necessarily just manage cash flows? And what I mean by that is to execute projects, we have a huge outlay of capital in our projects. We are saying that the faster we come online, the faster we have cash flowing in positive, the better for us as a business. Hence, we have innovation in execution. How do we [expedite] processes… and manage people and projects? That allows us to chase reverse cash flow, and deploy businesses in record time and at record costs.
“Aim, Ready, Fire”
What has worked about Reliance is… we don’t really believe in vision and mission statements as much as we believe in ambition and aspiration. In my mind… there are three types of organizations. The first one would be the “ready, aim, and fire” organization. These are companies who get ready with global processes, people, management, and systems. They start aiming at markets, and then they fire for execution to get it right.
The second type of organization is the “fire, aim, and ready.” These are the startups who fire with a brilliant idea, only to realize that something is going wrong, then trying to aim at the core of the idea, and then hopefully, finally trying to get ready.
Reliance is the third type, where we aim at a particular opportunity, whether it is telecom, retail, oil and gas, or whether it’s refining. Then we start getting ready to aim at that particular opportunity. And this readiness is through micro planning at all levels… This is what allows us to fire in a flawless manner… and deploy businesses at record speed and cost. Our vision remains the same in terms of what we aim at. We do course correction in the process but it’s all driven by ambition and aspiration…
A Dedicated Innovation Team
We’re learning in the process, we’re tweaking our programs, we’re doing course correction. We don’t believe in fail fast. We say that there’s nothing like failing fast because we deploy huge capital, huge efforts, huge investments towards our businesses. We just don’t have the liberty of failing, but we say that we will do course correction and get it right. So in the process, we’ve learned quite a bit. …For example, when our innovation programs run across diverse businesses and there are many stakeholders…we have to understand the behaviors of our stakeholders in the process and map them on our programs. That is a huge task, and something that we need to continuously improve on…
What I would say in terms of advice to other organizations would be to be true to the DNA of the organization when it comes to innovation… Do not say “It has worked for Apple or Google and it will work for us.” Every organization is different. Unearth that DNA, build programs, and build an innovation effort around that DNA. Otherwise, there will be a huge mismatch, and there will be a lot of chaos and confusion in the system.
What we have done, which has worked well for us, is to have a dedicated innovation team. Don’t leave it to R&D, don’t leave it to strategy and business development — but have a dedicated innovation team that looks at organizational innovation and drives it from that perspective.
To see the rest of Borde’s presentation, visit InnoLead’s Resource Center.