Godrej Group

A STRATEGIC MANAGEMENT PERSPECTIVE

By
GROUP 8 | SECTION F
 Revenue: $ 4.1 Bn

Market Cap: 14,915.54 Crore Rupees

GODREJ: AN
INTRODUCTI
ON Private, family owned Conglomerate

Industries served: Aerospace, Agriculture, Consumer

Goods, Home Appliances, Chemicals, Construction,
Electronics, Furniture, Real Estate, Security Solutions,
Infotech
ORGANIZATION
AL STRUCTURE
ORGANIZATIO
NAL
STRUCTURE

Source: Godrej Website

 VISION: GODREJ IN EVERY MISSION: ENRICHING
VISION HOME AND WORKPLACE QUALITY OF LIFE
EVERYDAY EVERYWHERE

AND
MISSION

VALUES: INTEGRITY,
TRUST, TO SERVE RESPECT,
ENVIRONMENT
VISION AND MISSION
Vision: “Godrej in Every Home and Workplace “
• answers “What will success look like”
• Provide “Reason for being”

Mission: “Enriching Quality of Life Everyday Everywhere “

• Realistic, Credible and Attractive
MISSION
Mission: “Enriching Quality of Life Everyday Everywhere “
• Realistic, Credible and Attractive

• It Answers:
• What is the basic purpose of organization?
• What is unique?
• What is in differentiator?
• Who are, and who should be, principal customers?
• What are the basic beliefs, values and philosophical priorities of firm?
VALUES
• Values: Integrity, Trust, To Serve Respect, Environment
• Reflects:
• Respect for their Employees
• Responsiveness to their customers
• Results for their Shareholders
COMPETITORS
• Response has been mixed
• Example: Lost market leader position in refrigerators with the rise of
Korean giants like LG, Samsung etc
in terms of Brand recognition, it stays #1
Showing inability of Godrej to capitalise on Brand image
• Example: GCPL Success- tapping new markets and diversifying risks
• Sara Lee’s Acquisition helped with efficient management of portfolio
in South Asia
COMPETITORS- AN EXAMPLE
GCPL: HUL, RB, P&G, ITC

Godrej Infotech: Oracle, SAP etc

Godrej and Boyce Manufacturing Co. Ltd.: LG,

Whirlpool, Samsung
CLIENTELE
• BARC, ISRO
• IAF, Navy
• HAL
• Indian Parliament
• MNCs like Hitachi, Reliance, Conoco Philips, Bechtel, Valero, MOOG,
Ion America Lab
FAMILY BUSINESS MODEL
• Family continues to hold 50-100% shares in its industries
• Senior Management is mostly third gen Godrej family members
• Fourth generation is just entering, with a strong succession plan
• Structural changes post liberalization
• Group Companies are like SBUs, chaired by family members
• Steady Growth, so model works
ORGANIZATIONAL STRATEGY- R
STRATEGY
• Maintaining market leader position in Security Products Division since
conception
• Second and Third Gen continued to enter unchartered territories
• First Movers’ Advantage:
• First Lock with Lever Tech: Anchor
• Introduced First Safe in 1902
• First vegetable oil soap
• First Introduction of Typewriters in India- mechanical (1955) and electronic (1985)
• First to bring Poly Urethane Tech in India (1958)
• Good Night, Hit etc (pesticides)
• And so on….
ORGANIZATIONAL STRATEGY-
UNRELATED DIVERSIFICATION
• Initially, From Locks to related security products
• From security to consumer appliances to material handling
equipment to precision components to life sciences, insurance, real
estate, telecom, medical diagnostics etc
• With later generations, this was more pronounced unlike Dabur,
Wadia families
• Families like Kirloskar have acted on Decision making through
consensus, but Godrej on risk minimization and family wealth
preservation
ORGANIZATIONAL STRATEGY-
DIVERSIFICATION
• A few acquisitions by Godrej:
• Transelaktra: mosquito repellents
• Keyline Brands Limited: international portfolio expansion
• Rapidol South Africa: mkt share now 80% in South African ethnic hair colour
market

• Internal Restructuring (transfer of Godrej Global MidEast FZE from

Godrej International to GCPL)

• JV: Godrej Properties and Godrej Agrovet

 Pre Independence: India

ORG
STRATEGY- Post independence, overseas
GLOBALIZATI expansion begins
ON

More than 25% of its current

revenue comes from overseas
markets
FUNCTIONAL STRATEGY
• Godrej Soaps (Parent company of GCPL) implemented TQM in 1991
• Godrej chose Kaizen over ISO 9000, as the latter did not reduce operational
costs
• By 2002, the model was extended to all Godrej companies
• GCPL: Collaborative Planning, Forecasting and Replenishment (CPFaR) model
instead of forecasting and push model
• Manufacturing in low tax areas like HP and Assam
• ERP in 1998
• Godrej and Boyce: Balanced Score Card in 1998
• Wide variety of products, but focus on low to middle income groups
INTERNAL ANALYSIS
• Strengths
• Core Strength: Value System
• Brand Name
• National Presence
• People
• Relationships
• Financial Strength
• Resources
• Weaknesses:
• GCPL Lack of the scale of competitors like ITC and HUL
• Stiff Competition affects market share
RESOURCES
• Capitalization of Internal Resources- Intrapreneurial
• Tangible- manpower, machinery, technological expertise, land
• Intangible- brand, customer and supplier loyalty and acquired
knowledge
• Long term goals include investment in quality, infrastructure and
enduring relationship with the employees
SOME OBSERVATIONS
• Family Control and cementing of values
• Succession Plan should be concrete and transparent
• Needs to be more dynamic to sustain and grow
This Photo by Unknown Author is licensed under CC BY-NC-ND