Podcast | Digging Deep - Giving and growing: The story of Wipro & Azim Premji

We begin today’s instalment of our series examining businesses and business families by posing a few questions.

Question number 1: What kind of business leaders does India need?

As we have been discovering on these podcasts every week, every generation of entrepreneurs has responded to that question in a manner that is as unique as their vantage point in history.

Question number 2: Can an entrepreneur remain insulated from the social context of his business story?

The answer to this question cannot be generalised and can only be individualised by those ideating and executing the blueprints of their business dreams. It is they, and only they, who finally get to decide whether or not through their success, they want to commit to a larger picture of social well-being.

Question number 3: Why were so many pre independence businesses committed intently and intensely to the ideals of philanthropy and nation building?

We have answered this question in this very space many times. It was because the nation was in the throes of defining itself as a free, sovereign, forward thinking, and idealistic, inclusive entity. The entrepreneurs of the era knew that their legacy would leave lasting imprints on not just the nation but its people so even as they built their empires they invested thought and money also in education, science, infrastructure, culture and more to improve the lives of the lesser privileged.

And now for the final question: Why are we asking all these questions?

Because today we want to tell the story of a family business that made its business to not just invest in cutting edge technology and the reinvention of the old into a new idea whose time had come, but also went back to the honest-to-goodness ideals of nation building.

Today we are going to tell you the story of Wipro and the man who turned it into a globally respected global brand. Yes, Padma Vibhushan, Azim Hashim Premji who not only built an information and technology empire but became one of the leading philanthropists in the world while he was doing so.

In April 2013, Azim Premji stated that he had given more than 25 percent of his personal wealth to charity.

In July 2015, he gave away an additional 18% of his stake in Wipro, taking his total contribution so far to 39%.

He remains deeply inspired by the Tatas, who he believes have made extraordinary contributions to the well-being of Indians. He often says that not many business empires around the world can match the span of the Tatas’ philanthropy though he is also inspired by the work that Bill and Melinda Gates as well as Warren Buffet have been doing to make the world a better place.

And how close he is to the ground realities was proven once during an interaction with The Economic Times, when he was asked about the best way to bring back eagles to villages and he said and we quote, "Throw grains for them. Second, you must grow trees all along the paths of the eagles. They don’t normally come and sit on the ground. They come and sit on the trees."

So ladies and gentleman, if this story is not worth retelling, we don't know what else is.

But let us start by first decoding the man who did it his way.

Azim Premji once said, "I strongly believe that those of us who are privileged to have wealth should contribute significantly to try to create a better world for the millions who are far less privileged."

He also said this - "Character is one factor that will guide all our actions and decisions. We invested in uncompromising integrity that helped us take difficult stands in some of the most difficult business situations."

These two statements show us the guiding principles of Azim Premji's entrepreneurial life. He wants to give back to the society where his success is rooted. And he wants to succeed with a certain set of uncompromised principles.

As an entrepreneur, he has over the years preached timely delegation of responsibilities, the importance of hiring people who may be smarter than their leaders, and giving respect to the voice of instinct that repeatedly says what needs to be heeded during small and big business decisions.

As he said once, "Essentially leadership begins from within. It is a small voice that tells you where to go when you feel lost. If you believe in that voice, you believe in yourself." Azim Premji's life is a study in the big power of that small voice but let us first tell you the Wipro story and then we will return to the life of its principal/principle architect.

Let us take a look at just what Wipro stands for and represents today.

As is common knowledge, Wipro is an integrated and consistently diversifying conglomerate offering multifarious products, solutions and services across systems, software, consumer care, healthcare, lighting and infrastructure technology. The company is associated with things as ubiquitous as soaps and cooking oil and to specialised healthcare instruments as well as information technology (IT) with global smarts.

The brand has routinely been listed as one of the most admired in India and its mission statement includes a passion for quality and an unstinting commitment to customers.

The company's focus is primarily on developing its software and IT services, which constitutes nearly half of the company's sales and continues to thrive in the areas of global IT consulting, e-business integration, and legacy systems maintenance.

And here we feel compelled to list out achievements not simply because they are glorious but because of the breadth of what Wipro is being celebrated for – not just innovation but also compassion; not just outstanding work but also an inclusive work culture; not just forward thinking into the brave new world but also rootedness in the values and ideals of a home-run enterprise.

For its rock solid record and work ethic, in 1998, Wipro became the first in the world to be awarded the Software Engineering Institute's (SEI) prestigious Level 5 Certification for quality.

Wipro was also recognized as one of the world’s most ethical companies by US-based Ethisphere Institute for six consecutive years.

In May 2016, it was ranked 755th on the Forbes Global 2000 list.

Wipro also won the Gold Award for ‘Integrated Security Assurance Service (iSAS)’ under the ‘Vulnerability Assessment, Remediation and Management’ category of the 11th Annual 2015 Info Security PG’s Global Excellence Awards.

Wipro won 7 awards, including Best Managed IT Services and Best System Integrator in the CIO Choice Awards 2015 in India.

In 2014, Wipro was ranked 52nd among India's most trusted brands according to the Brand Trust Report, a study conducted by Trust Research Advisory.

Wipro was ranked 2nd in the Newsweek 2012 Global 500 Green companies.

Wipro also received the 'NASSCOM Corporate Award for Excellence in Diversity and Inclusion, 2012', in the category 'Most Effective Implementation of Practices & Technology for Persons with Disabilities'.

Wipro has been ranked 1st in the 2010 Asian Sustainability Rating (ASR) of Indian companies.

Wipro made its debut on the New York Stock Exchange in 2000 and Azim Premji, with over 75 percent of the stock became a part of the exclusive club of the leading billionaires in the world. Proving without saying a single word that good guys do not necessarily finish last.

The beginning of Wipro though was not as larger than life.

Western India Vegetable Products Ltd was just a small but respectable company founded in 1945 by Muhammed Hashim Premji, Aziz Premji's father.

The company's big idea was to sell vanaspati or hydrogenated cooking fats and later sunflower oil to retailers. The retailers then sold the stuff forward to customers who in those years of minimalistic consumerism brought along with them containers to carry 50 to 100 grams of the cooking fat.

This is a company that symbolically birthed its own trajectory the year India unshackled itself from British rule. The senior Premji was 32-year-old then and formally laid the foundation of a vegetable oil mill at Amalner in Maharashtra.

The country was hurting from the wounds of Partition and this was the time when Premji senior was offered a political post of great power in Pakistan but refused to leave his roots, his country and his young business for a readymade future elsewhere.

What we do know for sure is that Wipro went public in 1947 and neither the Senior Premji nor the young Western India Ltd looked back.

The legacy of nation building begins

The senior Premji was not just another single-minded entrepreneur. He wanted to get involved in the processes that were shaping the country's destiny and future and he became the chairman of Bombay Electricity Board. He was also a board member of the Reserve Bank of India, the State Bank of India and the Life Insurance Corporation of India. This was the vantage point we were talking about at the beginning of this podcast – this unique place in history that shapes the perspective of a pioneering entrepreneur as he or she shapes his business.

He left behind an inheritance that included more than just material growth when he passed away in 1966, after a heart attack.

Premji was studying engineering at Stanford University, USA at the time and came back to take care of unfinished business. He was only 21.

The business which had till now been run with good intentions and modest successes lacked a professional, modern edge and Azim Premji was ready to change that and began working right away to achieve the shift.

The Azim Premji effect began to show up

What Premji began with was a three pronged approach to shake up things.

Step number 1 was to organise the company in a more streamlined, professional manner. To achieve this, he brought into the company the expertise of management graduates and the decision began to impact the company in big and small ways from simplifying packaging of the vanaspati to distributing and marketing it amid newer sections of rural consumers.

Step number 2 was to diversify the company portfolio. And where the company stands today proves that Premji's vision of a more diverse company has come true.

Step number 3 was to expand the company and Wipro's tentative steps towards that goal in the seventies led the company to the manufacturing of hydraulic and pneumatic cylinders and subsequently of soaps like Wipro Baby Soft and Wipro Safewash, toilet soaps like Santoor and Chandrika as well as Yardley. It also began to create lighting products, including Smartlite CFL, LED, and emergency lights but nothing was as momentous as its entry into IT.

In 1977, Azim Premji renamed the company, Wipro.

Foresight foretells success

Azim Premji sensed the potential in the about to explode computer industry at a time when software development was in a nascent stage in India but was vibrant enough to invite global attention. If multinationals like IBM had succeeded in monopolising and appropriating India's cheap human capital at that stage, Premji would not have found the space to subsequently not just to initiate an electronics unit but to turn it into a proudly and purely Indian triumph.

As the eighties dawned, Premji formally initiated an information technology entity laced with well thought out R&D and marketing strategies.

The discipline and quality control that had brought stable profits all along to the company now translated into adventurous innovations and manufacturing breakthroughs like PCs and workstations. And of course, much bigger returns because in the next decade and a half, Wipro became the No. 1 listed information technology company in India. The company also expanded its reach in foreign markets by assembling and redistributing hardware for companies like Cisco, Nortel and Sun Microsystems.

In 1999, Wipro become the only Indian computer manufacturer to receive Y2K-compliant certification from the National Software Testing Laboratory in the US. It also entered into a joint collaboration with KPN (a Dutch landline and mobile telecommunications company) to provide internet services in India.

Wipro soon became one of India’s largest software exporters and the second largest listed company in India.

It also opened a Business Process Outsourcing (BPO) unit in 2002 and was one of the best performing stocks during 1998-2003 on the Indian stock exchanges.

Wipro went on to amass over 140,000 employees and clients across 54 countries. In 2015, its IT revenues touched over $7.1 billion.

New collaborations

In an interview to The Economic Times, Azim Premji had once said and we quote him, "Change is just everywhere. And unless you learn to cope with change, you will fall behind."

To achieve this state of vibrant adaptability, from 1991 to 1997, for example, Wipro subjected itself to six corporate restructurings.

Wipro also sought international collaborations and in 1989, General Electric Co. (GE) partnered Wipro to develop and distribute ultrasound devices and other medical instruments throughout India and South Asia. This opened the door to multiple R&D collaborations with leading players like Cisco Systems, Hitachi, and Alcatel. Wipro GE subsequently became the biggest exporter of medical systems.

Wipro GE Medical Systems Limited today boasts diagnostics equipment, healthcare and IT solutions and services that adhere to stringent Six Sigma quality standards.

Wipro offloaded its PC brand in 1995 and got into a collaborative venture with Acer, a Taiwan-based company.

Despite economic fluctuations in the US post 2000, Wipro continued to expand and export across the US, Europe and Japan and stepped into new roles like e-business development, innovative software products, and business/system consulting.

The global success story continues well into the next century but the real legacy lies elsewhere

Years from now, when Wipro's story is retold, its far reaching impact on the IT industry will be recounted. The importance of ideas, innovations, elbow grease and persistence will be emphasised but what will be most remembered is just how in a success driven world, a man was led by not just his ambition but his imagination and his heart.

A man who had the confidence to not just build a $19.4 billion company but the conviction to take the Giving Pledge and become the first Indian and only third non-American to do so. The Giving Pledge, is incidentally, a campaign led by Warren Buffett and Bill Gates, to encourage philanthropy among the wealthy and Azim Premji is the third non-American after Richard Branson and David Sainsbury to join this drive.

The pledge squarely places 8.7% of Premji's own Wipro stock, in a separate trust that is used solely for educational purposes.

The manifestation of this commitment was the Azim Premji Foundation, a non-profit organization that was set up in 2001 with an aim of improving primary education in India.

As the patriarch of one of the most ethical companies in the world, Premji has been selected as one of 30 Greatest Global Entrepreneurs of all time by Business Week and was named one of the 100 most influential people in the world.

The influence extends to the portals of the Azim Premji University and the over 200 rural schools that have been set up to make education accessible to the underprivileged.

The Azim Premji Foundation today has over 800 employees and Premji feels obligated to give more and more to a cause that is quickly becoming his life's primary purpose. The Foundation currently functions across Karnataka, Uttarakhand, Rajasthan, Chhattisgarh, Puducherry, Andhra Pradesh, Bihar and Madhya Pradesh, in close partnership with various state governments.

In December 2010, when Premji transferred 213 million equity shares of Wipro Ltd to the Azim Premji Trust, the donation was the largest of its kind in India.

Premji's sons Tariq and Rishad and his wife Yaseen are an important part of this endeavour. Apart from his father's inclusive vision, Premji often credits his mother Gulbanoo for his interest in philanthropy. A trained doctor, Gulbanoo had set up a children’s orthopaedic hospital in Mumbai in the 1940s. And passed on values of thrift and social responsibility to her son who hopes to pass them on his children.

So when Rishad went to study in the US, he put in hours at a pizza eatery to earn some extra bucks!

As a conscientious citizen, Premji worries about the world he will leave behind for the next generation. He worries about corruption and infrastructural challenges being faced by a country that has space for individual success stories but not much enthusiasm for collective change. Something as basic as uncleared garbage in public spaces bothers him.

He even invited 40 top businessmen and philanthropists to join him along with Bill Gates and Ratan Tata to brainstorm about how personal wealth can translate into collective good in areas like not just education but health, water and agriculture.

For someone who micromanages every aspect of his own life, this generosity goes above and beyond anything anyone could have expected of him but then Premji wants to build something that will outlast him. A world that is, in his own words, "more ethical, more humane, and more equitable." And going by his track record, he will put every ounce of energy that he has to achieve just that.

So going back to the question we began the podcast with? What kind of business leaders does India need?

The answer is simple. It needs many more business leaders like Azim Premji.