Students at the Indian Institute of Management campus in Ahmedabad, Gujarat. Image: Getty ImagesG
ujaratis are known for their financial acumen, business traits, family bonding, and simple-yet-friendly lifestyles. All these and their demeanour have helped Gujaratis demonstrate a fondness for indulging in trade and business instead of opting for a corporate and professional service.
This is more profound and proliferated in Gujarat since ‘business runs in the blood’ in the state. In the early 50s and 60s, Gujarati business was mainly associated with textiles and mills—prominent among them being the Lalbhai and Sarabhai business families. Then came the giant leap with the entry of Dhirubhai Ambani and the Reliance Industries in the 70s. The trend continues to this day with the Adanis coming into the limelight. The addition to this lineup are new, successful businesses started by Gujarati businessmen—Symphony, Fogg, Balaji Wafers, Pidilite, Sintex, Wagh Bakri, Vadilal, Havmor, Zydus Cadila and Torrent, to name a few—which have attempted to junk the family-run business mentality and embrace unchartered domains. At the heart and soul, though, they remain Gujarati, making up 10 percent of the total businesses in India.
The Gujarati tradition of family involvement in businesses is about preserving legacy and ensuring business continuity. A Gujarati is more likely to trust his own before he trusts those outside his close-knit family.
Adapting to new trends
In recent times, Gujarati business houses have shown willingness to adapt to new trends and technologies. They have seen this as a way to proliferate and profit. Gujarati businesses have realised that while a major shareholding must remain with the family, external manpower and resources are needed if the traditional business has to upscale and diversify. This is where management schools come in.
The adaptation to change aligns with the importance of staying updated with evolving market trends and technological advancements—a key principle in modern management studies.
No wonder most Gujarati businesses have management professionals from eminent B-schools running the show, while the family scions hold on to the locker keys. In India, family businesses account for 79 percent of the national Gross Domestic Product (GDP). The 10th Global Family Business Survey by PwC states that 71 percent Indian family businesses show a strong desire to adapt to new-age methods such as digital transformation and data analytics, though this is more likely to come from outside than within the family.
Family businesses are known to be more entrepreneurial and adaptive with each succeeding generation than non-family businesses. Exposure and interaction with the Gujarati diaspora have made Gujarati family business houses recognise the importance of going digital and using modern technology to tried-and-tested methods started by the founding forefathers.
Role of institutions
Gujarati family businesses have an appetite for risk and are ready to reinvent themselves in line with the views of the newer generations. Veteran business leaders have realised that keeping the family flock together despite domestic squabbles over ownership and succession issues impedes quick and innovative decision-making. Also read: How family philanthropy can shape a new social contract in India
Over the years, Gujarati family-run business houses have shown the readiness to explore uncharted territories and a willingness to adapt and align with the principles of strategic management, need for professionalisation, creativity, communication, digital transformation, financial acumen and innovation taught in business schools.
The curriculum advantage
Business schools offer a structured and comprehensive curriculum that covers a wide range of subjects, including marketing, finance, operations, strategy and organisational behaviour. The adoption of such curriculum by Gujarati family businesses brings several advantages: Strategic vision:
Business school curriculum lays emphasis on strategic thinking and long-term planning. Integrating these concepts enables Gujarati family businesses to set clear objectives and devise effective strategies to achieve them. Innovation and adaptation:
In a rapidly changing market landscape, innovation is crucial. Business schools expose students to the latest trends and technological advancements. Adopting these teachings allows family businesses to remain competitive by embracing innovation and adapting to new market realities. Listen: Decoding the DNA of families that mean businessProfessionalisation:
Business schools focus on professional management practices. By integrating them, Gujarati family businesses can establish standardised processes, streamlined operations, and efficient governance structures. Global perspective:
With the globalisation of markets, understanding international business dynamics is essential. Business schools provide insights into global markets, cross-cultural management, and international trade, enabling family businesses to explore new avenues beyond their traditional domains. Financial acumen:
Comprehensive financial management is vital for sustaining growth. Business school curriculum offers expertise in financial planning, risk management and investment strategies, equipping family businesses to make informed financial decisions.
Challenges and considerations
While the integration of business school curriculum brings numerous benefits, there are challenges to be navigated: Cultural alignment:
Adopting modern management practices while preserving the core cultural values of the Gujarati community requires a delicate balance. Also read: From Ayodhya to Morbi, India's family businesses are thrivingResistance to change:
Traditional businesses may face resistance to change from older generations who have operated the business based on their own experiences and methods. Resource constraints:
Implementing new practices might require investments in training, technology and talent, which could strain resources initially. Customisation:
Business school teachings need to be tailored to the specific needs and contexts of individual family businesses, as each enterprise operates in a unique environment. Packing plant of the Wagh Bakri Tea Group. The company has, over the years, integrated business school insights to modernise its marketing approach. Image: AFP
Several Gujarati family businesses have successfully integrated business school curriculum into their operations: Arvind Limited:
A prominent textile manufacturer, Arvind Limited adopted modern supply chain practices from business schools to optimise its operations and enhance customer satisfaction. Patel Engineering:
A construction company with significant infrastructure projects, Patel Engineering adopted business school practices to enhance project management and risk mitigation strategies.
The company’s incorporation of modern project management techniques enabled it to undertake larger and more complex projects while maintaining quality and meeting deadlines. Wagh Bakri Tea Group:
They integrated business school insights to modernise its marketing approach. The company adopted digital marketing strategies, engaged with consumers through social media platforms, and diversified its product offerings to cater to changing consumer preferences. This transformation helped Wagh Bakri Tea Group retain its market share and appeal to a wider audience. Nirma Limited:
The detergent and consumer goods manufacturer leveraged business school insights to diversify its product portfolio and expand beyond the detergent market.
The company entered into segments such as personal care and hygiene products, cement and real estate. This strategic expansion was supported by market research, consumer behaviour analysis, and effective branding strategies—all influenced by business school teachings. Pankaj Patel is the chairman of Zydus Lifesciences LtdZydus Cadila:
This pharmaceutical giant incorporated research-driven innovation and quality assurance practices, leading to global recognition and growth.
The integration of business school curriculum into Gujarati family businesses represents a strategic transformation aimed at ensuring continued success and relevance in the modern business world.
By blending traditional values with modern management practices, these businesses are better positioned to navigate challenges, seize opportunities, and contribute to India’s economic growth. While challenges exist, the successes of early adopters demonstrate the potential benefits of this approach, offering a roadmap for others to follow suit.
Thus, in essence, the ethos of Gujarati business success is intricately woven into modern management education. The Gujarati business values of ethics, collaboration, adaptability, long-term vision, and community resonate harmoniously with what is taught in business schools, whose vision is not just to create good leaders but good citizens as well.