Reliance Global Strategy
Reliance Industries
Competitive Advantage:
• Vertical Integration Strategy: From trading yarn to providing yarns and fiber
for spinning and setting up PTA plant to enter into petrochemicals. Then integrating petrochemicals for oil refining and gas production, the integration process was the differentiation factor for RIL.
• Capacity increases and technology acquisition: RIL always targeted at generating large volumes and equipping with latest technology.
• Yes these practices are sustainable because such integration easily helps to switch between the products and also quickly to suit market changes.
RIL strategy:
• Dhirubhai Ambani was instrumental in setting up integration strategy, which
helped RIL to give an edge to competitors in terms of time to market and adjusting to market conditions. Eg: Integration between refinery and petrochemicals.
• RIL issued non-convertible debentures, which could be then converted into shares when it faced problems raising capital. RIL followed relationship and trust strategy to overcome regulatory issues. RIL focused on SOPs and SOCs as a means to have better efficiency thus differentiating from its competitors.
Key Success elements:
• Relationship and Trust with all levels of government officials.
• Focus on integration and technology acquisition. Key failings of Dhirubhai Ambani:
• Failure to write a will setting forth a process to handle transfer of ownership.
• Having 2 MDs without defining clear roles for each of them.