Vertical Integration: Dhirubhai adopted a vertical integration strategy by establishing a spinning mill
in Gujarat to differentiate Reliance from other yarn traders.
Quality Focus: Dhirubhai aimed to control the value chain and ensure product quality. He observed a
need for a ready product to maintain quality standards independently.
Cost Efficiency: Reliance's spinning mill was built at one-tenth the cost of a similar mill acquired by
competitor Aditya Birla Group, showcasing Dhirubhai's operational acumen.
Strategic Reinvestment: Reliance consistently reinvested earnings to modernize mills, adopting the
best technology rapidly. Despite public ownership, dividends were seldom declared to prioritize
business growth.
Stars (High Market Share, High Growth Rate):
Petrochemicals and Refining (including Jamnagar-2): These are described as world-beating
operations with modern technology, high efficiency, and global competitiveness.
Question Marks (Low Market Share, High Growth Rate):
Telecommunications (Reliance Jio): Launched in 2016, rapidly growing, but it requires significant
capital resources and managerial bandwidth. This segment is in a competitive and evolving market.
Cash Cows (High Market Share, Low Growth Rate):
Petrochemicals and Refining (original operations): These are described as having achieved high
capacity utilization rates and strong margins. The original refining complex had been historically
efficient.
Dogs (Low Market Share, Low Growth Rate):
Globalization Ventures: The information suggests challenges and uncertainties in Reliance's global
ventures, including acquisitions like GAPCO, Trevira, and the rejected attempt to acquire Lyondell
Basell.
Bargaining Power of Buyers (High):
In the telecommunications sector (Reliance Jio), buyers (consumers) have significant bargaining
power due to the intense competition in the market. Reliance Jio's innovative marketing strategies
and service plans aim at attracting and retaining customers in this highly competitive industry.
Bargaining Power of Suppliers (Low to Moderate):
In the petrochemicals and refining sector, Reliance has historically favored buying the best
technology available. The bargaining power of suppliers (technology providers, equipment suppliers)
might be moderate. However, Reliance's scale and global outlook may give it some negotiation
leverage.
Threat of New Entrants (Low):
The barriers to entry in the petrochemicals and refining industry are high. Reliance Industries, with
its large-scale facilities and global competitiveness, has established itself as a major player. The
capital-intensive nature of the industry, along with the complexities involved, acts as a deterrent for
new entrants.
Threat of Substitute Products or Services (Moderate):
In the petrochemicals and refining sector, there might be some threat of substitution from
alternative sources of energy or materials. However, given the diversified product portfolio and
Reliance's focus on efficiency, it has managed to maintain its competitive position.
Intensity of Competitive Rivalry (High):
Competitive rivalry is high, particularly in the telecommunications sector (Reliance Jio) and
potentially in global ventures. The entry of Reliance Jio disrupted the Indian telecom market, leading
to increased competition among major players. The global ventures, despite facing challenges,
indicate a willingness to compete on a global scale.
Rather than relying heavily on acquisitions like Google, The
Ambani's’ had a vision to build their own empire from scratch.
Reliance was a tax-free company as against Google which
faced some tax implications.
Reliance had a close-knit leadership team and had people
from within friends and family managing the overall business.
Reliance considered all its subsidiaries under its own single
umbrella whereas Alphabet had separated its corporate
structure into “Other Bets” and “Core business”.
Alphabet was less capital intensive as compared to Reliance
which had many large plants set up and was always looking at
capacity expansion.
Organizational working system of Reliance was standardised
and had transitioned from feudal (old way of functioning)
system.
Allentown lacked a good leadership structure, whereas Reliance created a strong
leadership fleet from the outset.
Nokia did not adjust to new trends, but Reliance has always been on the lookout for
industry innovation and changing practises.
Honda entered foreign markets and won a significant market share, but Reliance defeated
international companies like as the Koreans in their own market.
Thyrocare regarded both time and money to be equally important, whereas Reliance
deemed time to be the most important criterion in their decision making
