Ananda Krishnan’s first entrepreneurial initiative was venturing into oil trading. He has set up Exoil Trading that procures oil drilling contracts in various countries. While maintaining his first entrepreneurial ventures, he progressed further with his horse race betting operation in Malaysia. Adventurous and charismatic, he has a clear mission and a futuristic vision to diversify his businesses . He also ventured into stud farming in Australia, and is running a Hollywood cartoon studio in America and Manila. A quarter of his wealth comes from his first ventured business that includes betting and horse race wagering.
During the early days of 90’s, he ventured into Multimedia business and then created other business interest in satellite communication, broadcasting and gaming. He has also developed a string of multiplex cinema in Malaysia offering the best viewing of films on bigger screens. Due to his vision and venture, his business has spread around the globe, mainly in Southeast Asia and Europe.
AK is also known for his humble disposition, and for maintaining a low profile image among the ethnic Indian community in Malaysia. Though Ananda Krishnan hates public exposure, his entrepreneurial ventures have brought him into limelight, and he has got global recognition. KEYWORDS: Management Skills, business strategy, competitive edge, collaboration , entrepreneur, leadership qualities 16 www. jbmcr. org JBMCR Vol-I,No. -1,June-2012 An International business research journal (ISSN 2278-5280) An entrepreneur case in point Ananda KrishnaBuilding the empire CASE DEVELOPMENT PERSPECTIVE This mini case has been developed on the basis of corporate, online as well as other publicly available material, exclusively for use in teaching introductory courses of management or entrepreneurship.
It does not aim at evaluating the effectiveness of any policy, strategy or leadership style. INTRODUCTION T. Ananda Krishnan, popularly known as AK, is the richest man in Malaysia, currently estimated to have a fortune worth US$ 7. 4 billion, making him the third wealthiest man in Southeast Asia and standing number 119 in the world. He was born in 1938, Brickfields, Kuala Lumpur. He got his primary education at Vivekananda Tamil School, Kuala Lumpur, and then pursued his secondary education at Victoria Institution, one of Malaysia’s oldest schools.
Later on he got his tertiary education at the University of Melbourne, Australia, and obtained Bachelor’s Degree in Political Science. During his student days, he ventured into his first business which was a small scale horse race betting operation. This business has registered phenomenal growth after several years of struggling. Despite having a hugely grown business, Ananda Krishnan pursued his graduate studies, and obtained his Master of Business Administration Degree from Harvard University in 1964. AK is also known for his humble disposition, and for maintaining a low profile image among the ethnic Indian community in Malaysia. Though Ananda Krishnan hates public exposure, his entrepreneurial ventures have brought him into limelight, and he has got global recognition. He is also known for his generosity, as he has his own charitable foundation called Nusantara Foundation that offers scholarships to needy and promising students to further their studies. Furthermore, he has also donated a huge amount of Ringgit Malaysia (RM) i. e. 160 million to the Malaysia Education Foundation. BUILDING BUSINESS EMPIRE
Ananda’s corporate image, Usaha Tegas is owned and managed solely by himself. This company is described to be his investment and is run as a consulting organization with interest spanning into several sectors such as Communication, Broadcasting, Media and Energy. It is run by a board of advisers hand-picked by him based on their professional backgrounds and experience. Ananda Krishnan’s first entrepreneurial initiative was venturing into oil trading. He has set up Exoil Trading www. jbmcr. org 17 JBMCR Vol-I,No. -1,June-2012 An International business research journal (ISSN 2278-5280)
An entrepreneur case in point Ananda KrishnaBuilding the empire that procures oil drilling contracts in various countries. While maintaining his first entrepreneurial ventures, he progressed further with his horse race betting operation in Malaysia. Adventurous and charismatic, he has a clear mission and a futuristic vision to diversify his businesses . He also ventured into stud farming in Australia, and is running a Hollywood cartoon studio in America and Manila. A quarter of his wealth comes from his first ventured business that includes betting and horse race wagering.
During the early days of 90’s, he ventured into Multimedia business and then created other business interest in satellite communication, broadcasting and gaming. He has also developed a string of multiplex cinema in Malaysia offering the best viewing of films on bigger screens. Due to his vision and venture, his business has spread around the globe, mainly in Southeast Asia and Europe. His multimedia empire includes two communication companies – MAXIS Communication and MEASAT Broadcasting Network Systems- that navigate the earth with 2 satellites, providing the best communication globally. 46 % of shares in Maxis Communication Bhd. Malaysia’s largest cellular company is owned by Ananda Krishnan and his stakes have increased up to 70 % compared to British Telecom and AT & T. His MEASAT Broadcasting Network System, offering 30 direct to home television channels in digital format and has today 2 million subscribers around the country. THE ENTREPRENUER Being an entrepreneur himself, how does he manage all his businesses? His humble, bold, daring and risk taking character led him to remove Maxis Bhd. from the Malaysian stock exchange in order to privatize the company to cater to global market.
As an entrepreneur, he has a set of managerial qualities and business practices which he has applied in his bid to become a Malaysian billionaire. Ananda is planning to achieve his primary goals, where he would analyze the current situation, anticipate future undertakings and make appropriate decision to achieve his goals. As a businessman, he determines his business strategies and corporate goals together with his business partners, shareholders, employees and government sector in order to deliver strategic values, since his ultimate goal is to privatize and globalize the service provider Maxis.
The decision on privatizing was his alone though he discussed and analyzed with other entrepreneurs and his shareholders including Raja Datuk Arshad Raja Tun Uda, the Chairman of Binariang Satellite Systems holdings, which is also controlled by Ananda Krishnan. 18 www. jbmcr. org JBMCR Vol-I,No. -1,June-2012 An International business research journal (ISSN 2278-5280) An entrepreneur case in point Ananda KrishnaBuilding the empire Ananda Krishnan is also a great leader to his employees. He has proved to be a charismatic leader by managing his company and his fellow employees effectively.
Ananda is also known for his dynamism, and strong conviction. He has evoked a sense of excitement and adventure in performing his job, mesmerizing his employees and the community by applying his creativity and innovativeness and thereby ensuring his standing on No 119 in the Forbes magazine. He also leaves some of the decision- making privileges to his employees. He employs the right people for the right job. Today he is able to manage all his business from any part of the world due to his trustworthy employees.
He has set specific goals and visions for all of them, leading them towards a focused working environment. Ananda as a leader has the capabilities to influence an individual in his organization as he rewards them suitably for performing their best. He maintains a professional and socially responsible image in order to accomplish his goals and sustain the interest of the society. He also maintains relations within the government sector in order to create awareness about his service to the society. A close friend of Malaysia’s former Prime Minister Tun Dr.
Mahathir Mohamad, Ananda has the ability of applying his conceptual and decision making skills, in identifying problems and resolving them for the benefit of the organization. These skills have also directly involved the external environment, namely the Malaysian community. For an example, Ananda decided to privatize Maxis and promote the company globally for its investment benefits. Added to that, his actions would also be beneficial to his community as it hypes the name of his country Malaysia and a successful Malaysian. THE TURNING POINT
Ananda’s primary goal and farsighted mission was to diversify; as a successful entrepreneur; he diversified into various businesses from his small scale betting operations into oil trading, multimedia, communication and even real estate industry. Diversifying helps Ananda to build his business profitability as also to maintain and create job opportunity for the community. It is also another of his business strategies which reduces risk for himself. His concept of diversification basically is an alternate source of revenue generation in the event of any tough times.
Diversifying has already increased Ananda’s companies in terms of scale and scope by providing new products and services. Ananda has the quality of being innovative. He has invented new goods and services that benefit the consumers. For example, he had decided to launch 2 MEASAT satellites in space, which could enable any Malaysian subscriber to use the services provided by Maxis to communicate with any part of the world. Now Maxis offers everyone almost the best communication portal in terms of broadband, wireless www. jbmcr. org 19 JBMCR Vol-I,No. -1,June-2012
An International business research journal (ISSN 2278-5280) An entrepreneur case in point Ananda KrishnaBuilding the empire technology and video call services. Maxis, as we know, was a public listed company and now it has been privatized by removing it from the Malaysia Stock Exchange. Ananda’s reason for such a decision was to diversify or facilitate into the overseas market. According to the Chairman of Binariang Group, financing to debt over equity will enable Maxis to expand outside Malaysia. Ananda also plans to return Maxis back again to the Malaysia Stock Exchange after the company has earned its stable profit.
Since he has obtained completely all the shares, he had planned to expand Maxis into countries such as Indonesia and India in order to achieve a greater flexibility, furthermore increasing the stock rate to a higher value. Collaboration is another principle, which Ananda applies in his business strategy. He collaborates with global industries to provide services. Collaboration allows him to diversify his businesses further and builds a healthy relationship between two countries with government support. In his early days with Exoil Trading, he collaborated with an American geologist
Tom Cantwell to acquire rights to drill in Indonesia, Philippines, Sri Lanka and the North Sea. This collaboration aims to create a flexible expansion for Exoil Trading globally. Apart from Exoil Trading, Ananda also bided to buy over Singapore’s No. 2 cellular Company, Singtel and Australian’s No 1 Telecommunication Company Telstra by striking a joint venture with Hong Kong’s PCCW another telecommunication company. Australian’s Telstra did not agree to the collaboration strategy and yet it did not discourage him in anyway.
Ananda had his dreams of creating a regional media empire, which could deliver broadband services in other countries. He has entered into a collaboration with the world’s biggest cellular service provider, Vodafone which has already started operation in Australia and New Zealand. In order to gain competitive edge against its challenger Telstra, Ananda has also made another business collaboration deal with India’s Telecommunication group, Aircel by obtaining 74 % of its stake. CONCLUSION After all, being an entrepreneur is not an easy task.
An entrepreneur would require most of the management skills, which have been discussed above. An entrepreneur should be able to take risk to diversify his business. Proper planning and leadership qualities are necessary for an entrepreneur to make decision, leading, influencing and managing their employees towards achieving the organization’s mission and vision. One should be able to identify and resolve problems and apply analytical and conceptual approach to the decision making process. An entrepreneur should be able to create and deliver valuable business strategies, which would enable 20
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