Marico son Rishabh takes the soapy way

19 Sep,2011

By Kala Vijayraghavan

 

His start-up is dubbed Soap Opera N More – an apt name not just for the nature of the business but perhaps also for the succession drama that’s playing out at the Mariwala family-owned consumer company Marico. Mr Rishabh Mariwala, the 29-year-old son of Marico founder Mr Harsh Mariwala, has moved out of the family’s flagship operations to unleash his entrepreneurial skills.

 

Rishabh, who spent three years developing business at Marico’s beauty salon services arm, Kaya Skin Clinic, will now sell premium handmade soaps. Two years ago, Rajvi, 30, Mr Mariwala’s elder daughter had also opted out of Marico, where she was a part of the brand-building team, to focus on sociological research.

 

So what’s playing on the founder’s mind? Does he want to give the Gen Y members a shot at garnering experience in the world before cementing their positions in Marico; or is he clear that professionals will run the organisation, with family having no role to play in operations? As things stand, Mr Mariwala is the only family member with an executive presence on Marico’s board although the family owns around 63% of the company.

 

There are no clear answers to those questions. But even if Mr Mariwala is entertaining the thought of passing on the baton to his son, he isn’t going to present it on a platter. “This is not a ‘lala’ company,” he declares. “Family members are not automatically entitled to succession. They have to prove their mettle by building a business.” Company watchers add that Mariwala is keen that Rishabh step out of his comfort zone and go through the tribulations of starting and then running a business.

 

Rishabh’s path is a unique one. Here is a case of a potential successor who got into the business, then got out of it, with the distinct possibility of getting back again. The alumnus of Frank G Zarb School of Business, Hofstra University, New York, will start up Soap Opera N More with family funds, report to his father and sell the handmade soaps that are the brainchild of his mother, Ms Archana Mariwala.

 

“There are no compulsions of any kind on us as far as our career paths are concerned. And this (start-up) is a great learning experience for me,” says the lad who comes from a family that has a lineage of trading (“Mariwala” translates into pepper trader). Harsh broke out by founding his own consumer-oriented venture.

 

His son may well be keen to emulate him. “I am an entrepreneur and want Rishabh to have a similar experience in setting up an organisation from scratch. There are no pressures on family members to be part of Marico; eventually it will be their decision.

 

Marico has always been a professionally-run organisation” says the chairman. A nomination and governance committee in Marico has put in place a drop-dead succession plan as part of a risk-mitigation strategy. As a board member puts it on condition of anonymity: “Blood has nothing to do with the way Marico is run; there is a strong culture of professionalism and it operates independent of who is the largest shareholder.”

 

Perhaps the Marico founder wants to be sure of the fire in his son’s belly before he hands him a larger responsibility. Elsewhere in India Inc, second-generation scions have chosen routes to the family business. Rishad, son of Wipro chairman Mr Azim Premji, worked with GE Capital and consulting firm Bain & Co before joining the IT services major in 2006. Shravin, the 23-year-old son of Bharti’s Mr Sunil Mittal, worked as analyst with Wall Street banks in London and New York before joining up at one of Bharti’s subsidiaries.

 

Says Ms Padmaja Alaganandan executive director, PricewaterhouseCoopers: “A very high proportion of geNext in family businesses have professional qualifications and experience of working with good organisations outside their own; this gives them a broader canvas of experience and a good anchor to position and drive change within their organisations.”

 

In contrast, Mr Adi Godrej’s children Nisaba and Tanya, like Mr Rajiv Bajaj of Bajaj Auto, joined the business at the junior rungs and worked their way up while Mr Sasha Mirchandani, son of Mr Gulu Mirchandani of Onida, is treading a totally different path: he has opted to work with start-ups by founding Mumbai Angels, India’s first angel investment group.

 

Source:The Economic Times

Copyright © 2011, Bennett, Coleman & Co. Ltd. All Rights Reserved

 

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