Azim Premiji
drives an Escort and hates luxury. Meet
Mr Premji, the world's third richest man
By Peter Popham in Delhi
22 February 2000
India is digesting the news today that a businessman called
Azim Premji who drives a Ford Escort and stays by choice in
three-star hotels, is now probably the third richest man in the
world.
The only people undoubtedly richer, by the Indian media's
calculations, are Bill Gates, the founder of Microsoft, and
Warren Buffet, the Wall Street financier.
Mr Premji, who is based in Bangalore in the southern state of
Karnataka, is riding the crest of an astonishing stock-market
wave which in the past three weeks has added $33bn (œ21bn)
to the value of his software company, Wipro. That is enough to
turn India's $24bn fiscal deficit into a surplus.
At $62bn, Wipro's value dwarfs the gross domestic product of
Pakistan ($55bn). Mr Premji, who owns 75 per cent of the
company's equity, is worth an amazing œ35.25bn.
Party-poopers might point out that the rupee is not fully
convertible, but India is not listening.
Mr Premji's astonishing success ? he has been called India's
Bill Gates ? comes on the back of a revolution in India's
software industry. Fifteen years ago it barely existed, but
throughout the Nineties it has grown at more than 50 per cent
a year. Last year it grew at nearly 70 per cent.
The country has 200,000 software professionals, more than
half of them women, and there is a demand for 55,000 more
every year. Bangalore and Hyderabad, the two cities where
most of the software companies are concentrated, are trying
feverishly to reinvent themselves as rival "cyberabads".
The big names include Wipro, Mr Premji's company, Satyam
and Infosys. The biggest of them all, Tata Consultancy
Services, has 11,000 employees, and annual sales worth
more than 10bn rupees (œ150m), but what it is really worth is
anyone's guess as it has never been floated.
The great strength of Indian information technology (IT) has
been the software equivalent of all-night office cleaning: fixing
bugs while the West sleeps, and writing enormous,
labour-intensive programmes. The industry's biggest
opportunity came with the huge effort required to defang the
"Millennium Bug".
The rise of an obscure trader in cooking oil to the ranks of the
world's mega-rich is a modern fairy tale in which all the
popular myths about India and Indians are turned on their
heads.
In 1966, Mr Premji, a Muslim from Bombay, was an
engineering student in his second year at America's Stanford
University when his father died and he dropped out to go home
to take over the reins of the family business. It was an
unglamorous and not very successful concern.
The company was called Western Indian Vegetable Products,
hence Wipro, and its main commodity was "vanaspati",
sunflower oil, sold "loose" to retailers who doled it out to
customers who brought along their own receptacles.
Thirty years ago, India was a hard place in which to make
money. Prices were strictly controlled by the government, and
the black market was rampant. Any businessman who wished
to remain honest felt the pinch. Mr Premji solved the problem
by taking a sideways leap into engineering, his own preferred
field, manufacturing hydraulic cylinders.
But he was convinced that there must be a future in something
as fundamental as cooking oil, and he soon revolutionised the
marketing of the product by introducing oil in sachets of
different sizes.
From the start, Mr Premji nurtured a reputation for integrity,
which marked him as an eccentric in the early years. It is still
unusual enough, among the buccaneers and wide boys who
claw their way to the top of the Bombay stock market, to be
remarked on wonderingly whenever his name comes up. He
was also a stickler for professionalism, which was equally
unusual.
Although Wipro was a family firm, after his father's death Mr
Premji was the only family member working for it. In place of
the normal gaggle of brothers and cousins, Mr Premji took
properly trained managers from the renowned Indian Institute
of Management, whose top graduates are head-hunted by
blue chip firms in the West.
Today his older son, Rishad, is working for the US company
General Electrics' as a trainee on their financial management
programme. But Mr Premji has said that neither Rishad, nor
his brother, Tariq, will necessarily inherit the Wipro empire if
they do not come up to scratch.
Mr Premji's moment of destiny came in 1977, when IBM quit
the Indian market. He set up an electronics unit in Bangalore
to take up some of the slack. He started making hardware,
then in 1984 made the crucial move into software.
India's wealthiest man bucks all the stereotypes: he is neither
a maharajah nor the heir of a business dynasty; he is so
honest that he refuses to bid for contracts where bribery may
influence the decision. His company is so reliable that,
according to the certificate issued by the Software Engineering
Institute, it makes a maximum of 3.4 mistakes for every one
million opportunities for error.
He drives a Ford Escort and flies economy class. A long term
colleague says: "He has a tremendous ability to keep in touch
with both customers and employees in a way that is both
hands on and non-interfering."
Another colleague said that he regards business plans as
sacrosanct. "If you have made a commitment, he expects you
to keep it. If you have been delivering consistently, he won't
interfere. He is not emotional at all. He can separate the
emotional from the rational," said the colleague.
On the downside, Indian software engineers rate Wipro, in
contrast perhaps to Microsoft, a less than exciting place to
work, and he is blamed for not doing enough to enrich his
employees. A computer industry veteran said: "In the
knowledge-based business, you have to share wealth."
Unlike many IT companies, Wipro does not have many dollar
millionaires among its employees. But yesterday, Indians
were in no mood to nitpick. |
