How Indian "Bill Gates" switched from oil production to IT outsourcing

Forbes estimates the condition of the Indian Azim Premji at $ 15.9 billion. At the initial stage, he got his father's company for the production of edible oil. However, Premjee gradually turned it into an IT corporation. In the ranking of the richest Indians, he is second only to the owner of the industrial conglomerate of Reliance Industries Mukeshi Ambani from $ 18.9 billion and to the founder of the pharmaceutical giant Sun Pharmaceutical Dilipa Shangvi, whose assets reach $ 18 billion.

Source: voiceonline.com

Capitalization of the IT company Premji - Wipro Limited. - reaches $ 21.45 billion. Wipro was launched as an edible oil company in post-war India. In the 1970-1980s, Wipro took the first steps in the IT industry. Premji managed to capitalize on demand for programmers, which grew many times over in the world in the 2000s.
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Wipro has become the market leader in software development and outsourcing. Large companies contact Wipro for system solutions. In 2014, an Indian company entered into one of the largest contracts in this area: for ten years, it will cooperate with the Canadian energy holding ATCO, this deal will bring Wipro $ 1.2 billion, RBC writes .

Right off the bat

Azim Premji was born on July 24, 1945 in a wealthy Indian Muslim family. His father, Mohammed Hasham Premji, was one of the leading risers in Bombay (now Mumbai). The funds allowed the family to send Azim to Stanford University to study engineering. However, he had to interrupt his studies in 1966 - a semester before graduation. Suddenly, Azim's father died, and he was forced to return home and take charge of the family business.

Shareholders of Western India Vegetable Products Ltd initially accepted the new head of the company with hostility. One of them publicly offered the businessman to resign because he is too young to manage the company. But Azim did not follow his "advice."

Like clockwork

In the 1970s, Premji was engaged in continuous modernization of the company, relying on highly qualified personnel and new technologies. But the company made a real breakthrough in the late 1970s - early 1980s. In 1978, American IBM closed its business in India. The government forced the corporation to leave, accusing the monopolist (IBM controlled 80% of the high-tech market) deliberately supplying outdated products to the country.

This opened up great prospects for Indian companies in the IT market, which turned out to be almost empty. In 1977, Western India Vegetable Products Ltd changed its name to Wipro Ltd.

The company began with the production of mini-computers (at that time they were comparable in size to a modern refrigerator). Basic computer technology Wipro acquired from the American company Sentinel Corp. In the future, the Indians used their own development, created with the help of specialists from the Bangalore Scientific Institute.

“We created a first-class team and went our own way, 40% of our employees were busy with new developments, 40% worked in customer service, and the remaining 20% ​​were engaged in sales,” Premji said.

Business model extension

Sales of Wipro mini-computers went well even after India eased protectionist policies and major transnational computer companies (including IBM) returned to the country. Wipro even had a surplus of employees. “Instead of dismissing them, we thought - what if we could make a global research laboratory, whose services could be used by anyone,” recalled Premdzhi. Wipro was in a favorable position: it already had a client base, in addition, low costs (including wages) made it attractive for potential consumers.

So Wipro came to the classic outsourcing model: instead of doing their own computer research, creating and adjusting software and system solutions, companies could contact Wipro and get ready-made or customized solutions. Thus, Indian industrial conglomerates Tata , Infosys and Satyam began to cooperate with the company.

“We began to do unusual things. We started hiring not good technical specialists, but good businessmen who made a profit, ”Premjee said. According to him, it looks like one of the most popular maxims in Silicon Valley: “It’s easier to give a smart person a technical education than to instill in an engineer business management.”

In 1989, Wipro, together with General Electric, launched the production of medical equipment. Over the past twenty years, the company has entered the international computer technology market - according to Fortune, Wipro had over 100 customers among the 500 largest companies in the world.

Since the beginning of the 2000s, the IT business has brought the company over 80% of the profits. However, its oil business is still “alive”. “It's fun, you can touch it, unlike software. In addition, it is a profitable business. It grows by 25% annually. Our managers train on it, on it we hone our marketing, financial specialists, ”Premjee stated to the Stanford university publication.

"Scrooge McDuck" - Philanthropus

The interest of the general audience to the personality of Premji arose in the early to mid-2000s. It coincided with the rapid economic growth in India and the development of IT technologies around the world. In 2003, the Bloomberg Businessweek app published an essay about his life. It described how a billionaire gets up at 4:30 am and begins his day by corresponding with Wipro top managers on four continents.

Premgee's work day ends by seven in the evening. In the 2000s, Premdzhi was actively moving between the cities where Wipro opened offices - San Francisco, London, and Mumbai.

Families and colleagues Predzhi speak of him as a demanding, modest and to the smallest things economical leader, but this does not apply to charity. In July, he announced that he would bring the number of Wipro shares owned by the trust fund to 39%.

A charitable foundation is developing primary education in India. In 2013, Premgey joined the “oath of gifting,” which billionaires Bill Gates, Michael Bloomberg, Warren Buffett and Richard Branson, among others, brought among others. They all promised to donate or bequeath most of their wealth to charity.

Prejudge travels on regular flights, avoiding business jets. He only stops at three-star hotels and personally erases his things. These are his ideas about saving. “Scrooge McDuck is just Santa Claus compared to Premjee,” one of Wipro’s top executives in Bangalore told Bloomberg Businessweek.

Since the early 2000s, Premji has been investing in the reform of primary and secondary schools in India. His task is to search for effective models of school education and the training of teachers. In 2011, the Prejie Trust created 1300 schools across the country — they are free and teach in the local language.

“In India, more than 50% are illiterate. Does it hinder the progress of the country? Of course! ”The billionaire said in 2010.