Business Today

'Thrive Through Change'

Adversity builds resilience. It also helped me discover my reason for being - which was to create a self-sustaining high-performance organisation.
G.V. Prasad   New Delhi     Print Edition: January 14, 2018
'Thrive Through Change'
G.V. Prasad, Co-chairman and CEO, Dr. Reddy's (Photo: Vivan Mehra)

It was 1990. I was 29 years old, with some experience in running a construction business and a not-so-successful start-up. I was asked to lead one of the two companies that is today Dr. Reddy's. Here's an account of what happened and how the events that shaped the purpose of my professional life.

I graduated in 1983 with a master's degree in management from Purdue University, after completing an undergraduate degree in chemical engineering from Illinois Institute of Technology. My father had multiple businesses. After dabbling in a few things, I started a pharmaceutical business with my family called Benzex Labs. It was my first entrepreneurial experience and did not do too well. Meanwhile, Dr. Reddy's Laboratories, just founded by the legendary scientist-entrepreneur, late Dr Anji Reddy, was looking to expand. It made an offer to acquire Benzex, which we accepted.

I returned to my family business that was primarily into construction. However, I was on boards of the companies that Dr Anji Reddy had founded and continued to have a ringside view of how they were doing.

Dr. Reddy's was a small company that time, about $50 million in size with about 350 employees. However, it was in a rapid growth phase with fundamentals in its favour - a well protected market with only high-cost European competitors and a promising export market. It was a good situation to be in. In early 1990, Dr. Reddy's faced a management vacuum as its co-founder and CEO was leaving. I was asked to step in as CEO. Though caught unawares, I was pleased to get this role. It seemed like a nice cushy job in comparison to the drudgery of spending time on construction sites. A board meeting was called to formalise my appointment. Just as the resolution for my appointment was being taken up, an attendant brought in a slip of paper with a message that almost all employees in factories, research facility and quite a few in the office had tendered their resignations. More than 70 per cent employees had quit!

My predecessor, the co-founder and CEO, was a very strong and capable leader. Most employees knew him personally and a large number of them were his close associates. They were personally loyal to him and left the organisation in a show of solidarity. Things had fallen apart even before I joined, and I had to start my journey a disaster on my hands! Faced with empty plants, we had to recruit round the clock to get our production levels back to historic levels.

Soon after I took over, our main competitor in the US filed a case requesting imposition of anti-dumping duty on our main product Ibuprofen. The US was our main market and this created a huge risk for the company. Fortunately, we had a few committed colleagues and collectively we navigated our way out of the crises with hard work and dedication.

But this disruptive experience left me with a strong drive to make the company stronger than the few individuals who run it. It helped shape my thinking about organisations and how they should be run. It seeded in me a deep desire to build an organisation which can thrive through change - in owners, employees, products, technology. A desire to create a sustainable high-performing organisation, which is meritocratic, transparent and stands for always doing the right thing. My entire effort over the last 25 years has been driven by this single deep desire. This is what motivates me to come to work every day, work long hours and help my colleagues do extraordinary work.

We have come a long way. Our revenues have grown from under $50 million to a over $2 billion, with more than half coming from developed markets in North America and Europe. Our employee strength has risen from about a few hundred to over 20,000; people from over 40 nationalities are represented in our workforce. We have commercial presence in over 30 countries and our products serve patients in over 80 countries.

It has taken us many years to build this company, and our journey has not been linear. When I look back, our efforts broadly were channelised in three areas: Governance, Science & Technology, and Culture & People Practices.

Our corporate governance and internal governance were always based on doing the right things for all our stakeholders without any compromise. We went beyond the legal requirements and ensured transparency in all our systems. We have had many challenges in our journey, but we were always steadfast in our commitment to good governance.

On science and technology, our founder was a scientist first and an entrepreneur later. We always had love for science and technology as part of our DNA. We built on this heritage and today we have some of the most talented scientists working in our labs.

Over the last three decades, we have always believed and invested in creating a place where employees are empowered to give their best. We give them freedom to create an impact and opportunities to learn and grow. Unleashing the potential of every member of Dr. Reddy's remains our aspiration and all our people practices are designed for this.

That brings me to my key learning, which is about facing adversity. Adversity builds resilience and highlights the areas to focus on. In my early years, it also shaped my purpose and helped me discover my reason for being - which was to create a self-sustaining high performance organisation which can thrive through change.

 By G.V. Prasad, Co-chairman and CEO, Dr. Reddy's

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