Aditya Birla group on a consolidation drive

But the group had remained untouched. The sundry collection of bluechips that his father had left behind were running as if on auto-pilot for five years, Birla himself looked and learnt. The senior-most executives, the handpicked lieutenants in the great Aditya’s explosive growth through two decades left desolate by his untimely death, stood rock-like by Kumar Mangalam through the period, watching like hawks over the fortunes of a group that shareholders were beginning to question withincreasing urgency as to its aims and vision.

The recent acquisitions pointed the way. The pulp mill tied together the South-East Asian and Indian viscose filament yarn operations, a common raw material base that will slash costs. The Dharani and Shree Digvijay takeovers provided plants close to hitherto distant markets. India Foils did the same with foil manufacture, apart from tying up a substantial portion of the metal produced by group alumunium bluechip Hindalco.

But the group itself still looked unweildy, with cement figuring as major turnover spinners for two separate companies, for all virtual purposes a single operation, but unable to contribute as a single whole prosperous business to a single balance sheet.

With the present move to rationalise the cement business, strategically, Birla has taken a big step forward, altering for the first time the scheme of things as his father left them. What could be next on the agenda? Indo-Gulf Fertilisers was recently renamed Indo-Gulf Corporation toaccommodate the disparate copper business alongside the traditional fertiliser segment. Sponge iron and sea water magnesia are unlikely to figure in future as core areas for Grasim, which will concentrate its energies on textile, viscose staple fibre and cement. Selloffs could well be imagined. Indian Rayon and Grasim both sport substantial textile businesses, it is possible that the textile divisions can go the cement way.During an exclusive interview with The Indian Express last week, Birla stated his purpose: "We are not on an expansion drive. Our aim is to consolidate in every business that we are in, and emerge as among the top players in that segment."

Birla has also laid down his commitment to long-term shareholder value through a set of principles explicitly stated as the following:

* Retaining and building on leadership in existing core businesses

* Anticipate customer needs to create new markets

* Upgrade product and service quality continuously, reduce costs and integrate knowledge

*forward and backward linkages to control critical inputs and for enhanced focus on value addition

* use strength to seize emerging opportunities in key core sectors.

Partly, the commitment is reflected in the other things the group has been doing with the cement division: upgrading quality across the board.

The cement divisions received ISO 9002 certifications for quality management systems last year and Vikram Cement at Jawad received the Ramakrishna Bajaj National Quality Award from the Indian Merchant Chambers.