LDEN/063
IBS Center for Management Research
MS Oberoi and His Legacy
This case was written by Nitya Iyer, under the direction of Debapratim Purkayastha, IBS Center for Management Research. It was compiled from published sources, and is intended to be used as a basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation.
2009, IBS Center for Management Research. All rights reserved. To order copies, call +91-8417-236667/68 or write to IBS Center for Management Research (ICMR), IFHE Campus, Donthanapally, Sankarapally Road, Hyderabad 501 504, Andhra Pradesh, India or email: info@icmrindia.org
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LDEN/063
MS Oberoi and His Legacy
“My life has been achievement-oriented. I started off as a coal clerk at the Cecil Hotel in Simla. But I always had dreams and I worked my way at fulfilling those dreams.”1 MS Oberoi, the Founder of the Oberoi Group. “His [MS Oberoi’s]legacy isn’t just the hotels. His life has been a living example that nothing is impossible. Persistence brings success. His legacy is for the world to see and learn.”2 -Sanjiv Malhotra, Vice-president, Oberoi Towers, Mumbai, September 2001. “I have great respect for the professionalism of Oberoi Hotels. To me, both the hardware and software components are equally important in a complete hotel product and the Oberoi brand excels in both. P R S Oberoi stands for uncompromising quality like his late father and in this country at least, there isn’t anyone who is equal to them on that strength.”3 -Sunil Mathur, Director, International Development, Wyndham Hotel Group4, October 2007.
THE FATHER OF INDIAN HOTEL INDUSTRY
On Friday, May 3, 20025, Rai Bahadur Mohan Singh Oberoi (Oberoi), the founder of the Oberoi group of Hotels, passed away at the ripe age of 103. According to Ashok Soota, president, Confederation of Indian Industry6 (CII), ―The passing away of Rai Bahadur M S Oberoi has marked the end of an era of entrepreneurship. M S Oberoi‘s has been a truly ‗rags-to-riches‘ story and he has been credited with changing the idiom of hospitality and re-shaping the industry in the country. He would continue to be a source of inspiration to all budding entrepreneurs in the coming ages,‖7 JRD Tata8 described him as ―the father figure of the Indian hotel industry in India and abroad, and the country‘s only exclusive hotelier.‖9 Experts considered him as the father of 20th century hotel business in India for his contributions to the hospitality and tourism industry which created both direct and indirect employment and contributed to the country‘s economic growth. In his short autobiography for The Smart Manager in 1982, Oberoi mentioned that he ventured into politics
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Sonali Sudarshan Sokhal, ――My Secret of Longevity‖,‖ www.the-south-asian.com, February 2002. ―The Centennial Man,‖ http://timesofindia.indiatimes.com, September 1, 2001. Neeti Mehra, ―Inspiring Leaders of Tomorrow,‖ www.expresshospitality.com, October 31, 2007. Wyndham Hotel Group, with its global headquarters at Parsippany, New Jersey, USA, is one of the the world‘s largest hospitality companies across six continents. Bruce Palling, ―Obituary: Raj Bahadur M. S. Oberoi,‖ The Independent, May 7, 2002. Confederation of Indian Industry is a non-government, not for profit organization which aids growth of industries in India. ―Rai Bahadur M S Oberoi - A Tribute to the Founding Father,‖ www.expresshospitality.com, May 20, 2002. JRD Tata was India‘s noted businessman and aviator. He is regarded as an industrial pioneer in modern India. ―Father of Indian Hoteliering Rai Bahadur M. S. Oberoi, Turns 103,‖ www.asiatraveltips.com, August 20, 2001. 1
MS Oberoi and His Legacy
when he felt that he had established himself in his chosen field and felt the need to expand his horizons.10 Oberoi was elected to the Rajya Sabha11 twice, in 1962 and in 1972, and was also elected to the Lok Sabha12 in 1968.13 In 2001, Oberoi was conferred the Padma Bhushan14 award by the government of India for his contributions to the hotel industry. The foundation of the Oberoi Group of Hotels was laid in 193415 when Oberoi bought his first hotel. Over the years, the group had grown to become a very successful chain of luxury hotels and by the time of his demise, his hotel empire had spread across many countries. Of these, 13 Oberoi hotels were members of the prestigious ‗Leading Hotels of the World‘ list. Experts felt that Oberoi‘s vision, business acumen, hard work and leadership and management style played a big role in his success. As of 2009, the group was led by Oberoi‘s son Prithvi Raj Singh Oberoi (Bikki) and the third generation of the family was also closely involved in the running of the group. Together they strove to take the Oberoi Group to new heights by taking forward the legacy of Oberoi.
EARLY YEARS
Though Oberoi always quoted his birth year as 190016 because he didn‘t want to be viewed as a person from the 19th century, Oberoi was born on August 15, 1898 in a small village called Bhaun in Jhelum district, which is now part of Pakistan. His father passed away when he was barely six months old and he was raised by his young mother, Bhagwanti. As a child he was brought up in poverty, but he always aspired for the finer things in life. Once he told his mother that he would not wear the rough textured clothes she had purchased for him. ―I always wanted the best,‖17 he later commented, Oberoi finished his primary schooling in Rawalpindi and completed his matriculation in 1916. Then he moved to Lahore where he completed his secondary education at the DAV College. While studying he looked after certain aspects of his uncle‘s shoe business. After completing the intermediate exams and halfway through his Bachelor‘s degree, he decided to discontinue his studies much to the concern of his well wishers, and learnt typing and shorthand in the hope of enhancing his skills to find a job. ―My studies were cut short as our already meagre finances began to dwindle. This was a moment of anxiety in my life as I realised that my qualifications would not get me a job,‖18 he later recalled. He also started working full time as a manager at his uncle‘s shoe company. But there was much unrest in India following the World War I, as the country agitated for independence from the British rule. The agitation intensified after the April 13, 1919 massacre of peaceful protestors at Jallianwalla Bagh at Amritsar. The factory in which Oberoi was working closed down because of financial difficulties and he had to return to Bhaun.19 When Oberoi was 20 years old, he married 15 year old Ishran Devi even though he didn‘t have a job. Soon after, he
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―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. Rajya Sabha is the upper house of Parliament of India. Lok Sabha is the lower house of Parliament of India. ―Indian Entrepreneurs: M.S. Oberoi Profile,‖ www.iloveindia.com. Padma Bhushan is India‘s civilian award for distinguished service to the nation in any field. ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. Paul Lewis, ―Mohan Singh Oberoi, 103, A Pioneer in Luxury Hotels,‖ http://query.nytimes.com, May 4, 2002. Bachi J Karkaria, Dare to Dream: The Life of M.S. Oberoi, (Penguin Portfolio, 2006). ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. 2
MS Oberoi and His Legacy
outraged the entire Sikh20 community when he shaved off his beard. The decision was prompted by the fact that he felt his beard was unkempt as he did not have time to wax and roll it like fellow Sikhs, and he was not prepared to settle for second best. However, the decision enraged his family and disconnected him from them. His uncle, who had restarted his shoe business, too was enraged and Oberoi could not work there anymore. Thereafter, to escape a dangerous plague that had hit Bhaun, Oberoi moved to Shimla leaving back his wife and newly born daughter in Muree, a hill station now in Pakistan. Shimla was the summer capital of British India and here Oberoi started looking for employment. He took the civil service exam for the Public Works Dept but could not get through. Oberoi mentioned in his short autobiography that he was in a state of depression as he had no job, and had the additional responsibilities of a wife and child and therefore spent his time just walking around Shimla, looking for employment.21 On one such occasion, he spotted Hotel Cecil where he immediately went to ask for a job.
FROM CLERK TO „HOST TO THE WORLD‟
Oberoi got a job as a reception clerk at Hotel Cecil for a salary of Rs. 40 per month and it was soon increased to Rs. 50 per month.22 Analysts pointed out that the manager of the hotel, DW Grove (Grove), was impressed with his perfectly knotted tie and polished shoes and offered him the job. The management of the hotel soon changed and Grove was succeeded by Ernest Clarke (Clarke). Working under him Oberoi starting learning the tricks of the trade of running a hotel. Experts said that he was a quick learner. Because of his hard-work and initiative to do more than his job, he was given additional responsibility and he progressed in his career, gaining both in position and in pay. By then he was staying at Shimla with his family. Experts believed that Oberoi‘s meticulous and methodical nature helped him gain praise early on. In 1925, when he was working at Cecil Hotel, Motilal Nehru23 (Nehru) a guest in their hotel needed a large document to be typed by 5 am. He asked if someone in the hotel could do it and Oberoi agreed. Oberoi sat up all night and typed the document very carefully.24 When Nehru got the document with a knock at his door at 4.45 am, he was delighted. Oberoi had typed it perfectly without a single error and Nehru gave him Rs. 100 in gratitude and appreciation.25 Oberoi‘s monthly salary at that time was Rs. 60 and that gift money was large enough for him to buy his family some much needed items.26 In 1927, when Clarke‘s agreement with the Associated Hotels of India27 (AHI) came to an end, he decided to independently venture into the hotel business. Clarke acquired a catering contract with the Delhi Club and offered Oberoi the chance to join him. Oberoi was glad to accept the position with a higher pay.
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The Sikh community follows Sikhism which is the fifth largest religion in the world. According to this religion, the baptized Sikh had to wear five articles of faith at all times and they are: uncut hair, small comb, iron bracelet, a short sword and an undergarment. ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. Motilal Nehru was the leader of the Indian National Congress and father of future Prime Minister of India, Jawaharlal Nehru. ―MS Oberoi: Hotelier Par Excellence,‖ www.financialexpress.com, May 4, 2002. ―The Centennial Man,‖ http://timesofindia.indiatimes.com, September 1, 2001. ―MS Oberoi: Hotelier Par Excellence,‖ www.financialexpress.com, May 4, 2002. Associated Hotels of India is an organization that provides sales, marketing and reservation services to independent hotels and chains. 3
MS Oberoi and His Legacy
After the Delhi Club contract came to an end in a year, Clarke was again looking for new opportunities when he learnt that the Carlton Hotel in Shimla was going bankrupt. Though Clarke was keen to acquire the hotel, he did not have guarantors to back him up. Oberoi, in a bid to reciprocate the kindness that Mr. Clarke had shown him in his past, took the help of some of the wealthy acquaintances of his mother. The Carlton Hotel finally became Hotel Clarke with Oberoi‘s help and he became a partner in 1930. Clarke, after a couple of years, chose to retire and offered Oberoi the opportunity to take over the hotel and maintain its reputation. On August 14, 1934 Oberoi took his first major risk in life when he decided to mortgage his wife‘s jewelry for Rs. 500 and borrow the rest from acquaintances for a huge sum of Rs. 20,000.28 Oberoi then became the owner of Hotel Clarke and established himself in the hotel business.29 That day, when he returned home, his eldest daughter, Rajrani greeted him with a birthday kiss and Oberoi told her, ―Just wait, bitti, when you grow up, wherever you go, there‘ll be an Oberoi hotel.‖30 Soon after, in 193731, he leased Calcutta‘s Grand Hotel with the help of partners at a time when the city was suffering a cholera epidemic. The hotel was closed for five years owing to the death of around hundred guests and due to concern regarding water contamination in the hotel‘s water supply. Oberoi took advantage of the situation, negotiated a good deal and signed an agreement to lease the 500 room hotel. He borrowed funds against his Shimla hotel to refurbish the interiors and succeeded in convincing guests to stay in his hotel by promising them soda water and food from outside the hotel. He employed Grove, the first manager he had worked under, as the manager at a pay of Rs. 1,500 per month.32 Experts observed that Oberoi was a shrewd businessman who managed to transform external challenges to business opportunities. They referred to the instance during the Second World War II, when he averted confiscation of his hotel by the British by volunteering to offer the officers cheap food and lodging. Oberoi seized the opportunity by preparing 1,500 beds which he let out for Rs. 10 each including boarding and lodging.33 He however, charged extra for women who spent the night there. Oberoi further contacted all liquor suppliers around the country to dispatch supplies, which resulted in good business and revenue. The money he made form this helped him expand his business. Oberoi‘s acquisition of the Grand Hotel and his attempt to help the British army at their time of need gave him the due recognition from the British government. In 194334, he was conferred the ‗Rai Bahadur‘35 title in recognition of his service to the hotel industry in India. During the same year, Oberoi also rented Delhi‘s Imperial Hotels and took possession of the Associated Hotels of India. In 1944, Oberoi introduced the convention of having a tall and hefty Sikh bodyguard ceremonially dressed, outside the Imperial Hotel and also introduced a new menu in all Oberoi hotels.36 In 1949, he founded The East India Hotels Limited and merged Associated Hotels of India Ltd. with it in 1968. By 1952, he bought out all his partners
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―MS Oberoi: Hotelier Par Excellence,‖ www.financialexpress.com, May 4, 2002. Bruce Palling, ―Obituary: Raj Bahadur M. S. Oberoi,‖ The Independent, May 7, 2002. ―MS Oberoi: Hotelier Par Excellence,‖ www.financialexpress.com, May 4, 2002. Paul Lewis, ―Mohan Singh Oberoi, 103, A Pioneer in Luxury Hotels,‖ http://query.nytimes.com, May 4, 2002. ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. ―Oberoi Mohan Singh,‖ www.famoushotels.org, December 11, 2006. Rai Bahadur was a title of honor conferred on Indian individuals by the British for their service to the nation. ―Oberoi Mohan Singh,‖ www.famoushotels.org, December 11, 2006. 4
MS Oberoi and His Legacy
Experts observed that the ownership of the Grand Hotel was the turning point in his career, and good fortune favored Oberoi thereafter (Refer to Exhibit I for MS Oberoi‘s hotel empire: A timeline, Exhibit II for a list of the many firsts in Oberoi‘s career, and Exhibit III for the awards and recognitions received by Oberoi). He started steadily expanding his business and in the process emerged as the entrepreneur that the future generations would know him to be. By May 2002, the Oberoi group controlled 35 hotels in seven countries across the world. The group employed over 12,000 people worldwide (Refer to Exhibit IV for the East India Hotel‘s Financial Highlights and Exhibit V for a list of Oberoi group properties in India and abroad).
INTERNATIONAL EXPANSION
In 1947, after the partition of India and Pakistan, Oberoi was left with four hotels in Pakistan. These hotels continued to operate under the group till 1965 when the war between India and Pakistan led to the confiscation of the hotels by the Pakistani authorities. The group‘s first venture outside India was the palace hotel, Kathmandu Soaltee in Nepal, of which the group took management control in 1969.37 It had to be content with management control only as the regulations in India then did not allow the group to own hotels in foreign countries. More international expansion followed Oberoi‘s younger son Bikki and his son-in-law Gautam Khanna (Khanna) playing a key role. Other hotels were the Mena House in Cairo, which Oberoi acquired in 1971 with the arrangement that he would guarantee a 6 percent return on investment to the hotel owners but would not be able to spend the money on restoration. Mena House turned out to be a grand success and led Oberoi to other projects in the Arab world. In 197638, Oberoi won the right to lease the historic Windsor hotel in Melbourne for two years against a backdrop of much racial discrimination and opposition from the Australian press. Analysts pointed out that he always managed to plan and execute the renovation of the hotels he took up, restoring them to their original grandeur. He carefully selected his team for each project so that the hotel reflected the individual country‘s culture and revived the hotel‘s original style rather than adding his Indian influence. Each Oberoi hotel‘s interior was personally designed by Oberoi. His superior style and taste was reflected in each hotel‘s interior.39
THE VISIONARY AND THE STRATEGIST
In the year 1860, William Howard Russell40 wrote, ―A hotel in India up country is a place where you can get everything that you bring with you and nothing else except a bed and soda water.‖ 41 Analysts considered Oberoi as the sole accomplished entrepreneur who was instrumental in associating the words luxury and hospitality to the hotel industry in India. Analysts highlighted how Oberoi focused on his career and planned every move. He confidentially and systematically bought shares of Associated Hotels of India Ltd. (AHI), India‘s leading hotel company from early on. In 1944, when he had acquired enough shares to gain control of the company, he went to the annual meeting uninvited, with all his shares in a bag.42 As a result, Oberoi became the first Indian to manage the best chain of hotels which included the Cecil and Corstophans in Shimla, the Imperial and the Maidens in Delhi, and one hotel each in Lahore,
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Paul Lewis, ―Mohan Singh Oberoi, 103, A Pioneer in Luxury Hotels,‖ http://query.nytimes.com, May 4, 2002. Oberoi Mohan Singh,‖ www.famoushotels.org, December 11, 2006. ―Rai Bahadur MS Oberoi: A Hotelier and a Gentleman,‖ www.financialexpress.com, May 5, 2002. William Howard Russell was an Irish reporter and a war correspondent who worked with The Times. Bruce Palling, ―Obituary: Raj Bahadur M. S. Oberoi,‖ The Independent, May 7, 2002. Paul Lewis, ―Mohan Singh Oberoi, 103, A Pioneer in Luxury Hotels,‖ http://query.nytimes.com, May 4, 2002. 5
MS Oberoi and His Legacy
Murree, Rawalpindi and Peshawar.43 In fact the Flashmans Hotel at Rawalpindi was the first hotel he saw when he had gone to that city for his schooling. Oberoi got the opportunity to employ the son of his first employer Mr. Falleti, as a general manager for his Shimla hotel and he believed, with that ―the wheel had turned a full circle‖44. The hotelier further expanded into Kashmir, Darjeeling and Chandigarh. The Oberoi Palm Beach in Gopalpur-on-Sea, a small hotel in Orissa45 was set up in 1947.46 Experts considered Oberoi a true entrepreneur for his planning and execution. He established Mercury Travels in 194847, which was run by his elder son Tilak Raj Oberoi (Tikki), after he realized how dependent the hotel and hospitality industry was on travel agents.48 In 1949, Oberoi established East India Hotels (EIH) which came to be known as EIH Ltd. later and was the flagship company of the Oberoi group. Oberoi had a passion for learning. It was due to this zeal that he took his first trip abroad in 1952 when he stayed in 25 of the world‘s best hotels only to observe and scrutinize every aspect of the functioning of hotels while his family was busy sight-seeing. This helped him to bring in service aspects into India that were unheard of till then. In 1955, Oberoi visited Kashmir where he bought Maharajah Hari Singh‘s former palace. Oberoi agreed to pay Rs. 5000 per month for the next twenty years in return for use of the elaborate palace which had been lying vacant for over ten years, including all its furniture..49 He restored the palace to its grandeur. Experts felt that since that time, Oberoi made restoration of run-down places to build luxury hotels into something of an art form. This was repeated in subsequent years with many run-down historic buildings around the world. Experts called Oberoi a ‗social reformer‘50 as he created quite a revolution by employing women in the hotel industry. In 1957 he introduced chambermaids with vacuum cleaners in the Oberoi International Hotel in New Delhi instead of the bearers and stewards that the Indian hotel industry was used to. Despite strong criticism from moralists, Oberoi stood firm on his decision. Analysts realized that Oberoi was ahead of his times and it was his bold step that opened the doors for women in the hospitality industry. Both the hospitality and the travel industry helped generate direct and indirect employment in India and resulted in the country‘s economic growth. As a business leader, Oberoi had his values clear and he often said, ―You think of money and you cannot do the right thing. But money will always come once you do the right thing, so the effort should be to do the right thing.‖51 He sensed the need for professional training in the hospitality industry and hence in 1966 he started Oberoi School of Hotel Management.52 This was the only private institution which was recognized by the International Hotels Association.53 The graduates of Oberoi School of Hotel
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―M.S. Oberoi Profile,‖ www.iloveindia.com. ―How M S Oberoi Became India‘s Greatest Hotelier,‖ www.rediff.com, October 21, 2005. Orissa is a state located in the eastern coast of India. ―Oberoi Mohan Singh,‖ www.famoushotels.org, December 11, 2006. ―Oberoi Mohan Singh,‖ www.famoushotels.org, December 11, 2006. ―Rai Bahadur Mohan Singh Oberoi,‖ www.oberoihotels.com. ―Rai Bahadur Mohan Singh Oberoi,‖ www.oberoihotels.com. ―Rai Bahadur M S Oberoi - A Tribute to the Founding Father,‖ www.expresshospitality.com, May 20, 2002. Paul Lewis, ―Mohan Singh Oberoi, 103, A Pioneer in Luxury Hotels,‖ http://query.nytimes.com, May 4, 2002. ―Rai Bahadur MS Oberoi: A Hotelier and a Gentleman,‖ www.financialexpress.com, May 5, 2002. ―Father of Indian Hoteliering Rai Bahadur M. S. Oberoi, Turns 103,‖ www.asiatraveltips.com, August 20, 2001. 6
MS Oberoi and His Legacy
Management, because of the strenuous training they received, were easily accepted in the industry across the world. The school which later came to be known as Oberoi Center for Learning and Development was considered among the best schools in Asia with around 100 students graduating each year.54 ―He believed in the vital importance of training and development, and in difficult times did not succumb to the temptation to save money by cutting expenditure on training or on property maintenance,‖55 said Ravi Bhoothalingam (Bhoothalingam), a former president of the Oberoi Group Oberoi was also praised for choosing his successor well and grooming him over the years. Though, according to Oberoi, Tikki‘s knowledge of the hotel business and business acumen had a positive long-term effect on the future of the Oberoi Group, he chose Bikki as the successor. Experts observed that Oberoi had a gift of identifying both a person and a hotel‘s ability. When his daughter, Swaraj fell in love with Khanna, Oberoi immediately recognized the boy‘s capabilities and aptitude and accepted him into his family. Thereafter, he asked him to join the business. For the future, he also planned to make his son-in-law his son‘s right hand in business. He was also very particular about the people he chose for each project and handpicked each person carefully, evaluating their individual skills for the requirements of the job. He got into politics as he thought that someone had to present the case for hotels. He strove to get for hoteliering the status and concessions of an industry. On one occasion, he also vehemently opposed the government‘s proposal to bring in Hilton and give it 33 1/3 % of gross operating profit. According to experts, Oberoi‘s strategy of owning the property so that it could be used as collateral for future loans paid off handsomely. In this process, he was on several occasions faced with the possibility of financial ruin but was able to get around the problem through his resourcefulness. Oberoi believed in consolidation rather than diversification and as such did not move into other business areas as did other leading business houses in India. He also had an interesting take on competition. According to him, ―Competition keeps everyone on the toes and the beneficiary is the industry.‖56 He said that he did not worry about competition as worrying hinders the way one thinks. Industry observers said that the tourism industry in India, in general, benefited greatly from the vision of Oberoi. ―[T]he contribution for which he will be remembered and respected most is the realisation of his vision that hotels, a major economic activity, in themselves, were part of a larger picture called tourism, which could much to generate employment and alleviate poverty. In other words, he put hotels on a larger canvas of the socio-economic development of the nation,‖57 said Rabindra Seth, veteran industry journalist. Oberoi, the doyen of hospitality who owned a chain of luxury hotels spanning across many countries often said, ―I have been able to accept the challenge and make good. There is comfort in knowing that whatever little I have achieved has also helped to raise the prestige of my country.‖58 He never forgot his humble beginnings and the difficulties he faced before he achieved success. He believed in fate as he associated his past with acts of nature saying, ―It is a strange coincidence that nearly every turn in my life has been associated with an epidemic of some sort.‖59 He referred to two instances where the first was the plague epidemic which forced him to flee his village and
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―MS Oberoi: Hotelier Par Excellence,‖ www.financialexpress.com, May 4, 2002. ―Rai Bahadur M S Oberoi - A Tribute to the Founding Father,‖ www.expresshospitality.com, May 20, 2002. Bachi J Karkaria, Dare to Dream: The Life of M.S. Oberoi, (Penguin Portfolio, 2006). ―Rai Bahadur M S Oberoi - A Tribute to the Founding Father,‖ www.expresshospitality.com, May 20, 2002. ―Rai Bahadur Mohan Singh Oberoi,‖ www.oberoihotels.com. ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. 7
MS Oberoi and His Legacy
move to Shimla and the second when a cholera epidemic broke out in Calcutta and the Grand Hotel had to close down. The first incident decided his career in the hotel industry and the second helped him lease the Grand Hotel and established him in that career. Oberoi was, however, quick to add that hard work and his ability to tap the opportunities were more important. ―Yes, a lot came my way, but it was up to me to turn it to advantage. Some hotels dropped into my lap, but the success wasn‘t handed on a platter. The old ones were tumbledown ruins; my work made them what they became,‖60 he said.
HIS EYE FOR QUALITY AND DETAIL
Oberoi was obsessed with quality and attention to detail. He used to get involved in the nitty-gritty of operations even in the later years when the group had become very big. He kept a close watch on every aspect of operations. For instance, the way a bed should be made, a tray arranged, etc. He was detail oriented and uncompromising on certain matters. He was particular about minute details like the number of feathers in the down pillow and the exact length of the flowers that were displayed in the lobbies of his hotels. 61 Bikki quoted his father saying, ―Never settle for second best in life or the work you do‖. He added that his words had been the company‘s philosophy to be ―the best but not necessarily the biggest‖.62 Oberoi used to keep an eye on controlling costs, but not necessarily by cutting corners. After setting up his hotel venture, he stressed on the importance of devising a system from which there is no deviation. This he perfected over the subsequent years and decades. ―A relentless quest to improve performance, incrementally, day by day, till you are the best, has been the guiding principle of Rai Bahadur,‖63 said Bikki. Experts noted that no one could ever find a picture hanging crooked on the walls of an Oberoi hotel. All individual rooms, the common areas and staff facilities were extremely well maintained. That was the level of efficiency and professionalism ingrained among the staff of the Oberoi group by Oberoi even at the time when the International Organization for Standardization (ISO) ISO 9000 and ISO 14000 were mere ideals. Experts agreed that Oberoi practiced what he preached and did not hesitate to perform even the most mundane chores. He personally checked the quality of supplies offered to the guests. He also read the suggestions and remarks made by the guests in the guest books to be generally aware of what they experienced. He inspired his employees to feel the same degree of enthusiasm for serving and assisting others that he did.64 If a vexing problem surfaced he would station himself in the area, observe the problem, and not relax until he had pin-pointed the bottleneck and arrived at a solution. In new ventures, he even positioned himself in the lobby to address bottlenecks in guest flow. This also gave him an opportunity to overhear remarks which helped him provide better customer service. ―Today they call it ‗hands-on‘ and ‗management by walk-through‘, but the selfmade men who also made Indian enterprise had not read about it in Harvard Business School casestudy; they were the book,‖65 wrote Bachi Karkaria (Karkaria), his biographer.
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Bachi J Karkaria, Dare to Dream: The Life of M.S. Oberoi, (Penguin Portfolio, 2006). Paul Lewis, ―Mohan Singh Oberoi, 103, A Pioneer in Luxury Hotels,‖ http://query.nytimes.com, May 4, 2002. ―Father of Indian Hoteliering Rai Bahadur M. S. Oberoi, Turns 103,‖ www.asiatraveltips.com, August 20, 2001. ―Father of Indian Hoteliering Rai Bahadur M. S. Oberoi, Turns 103,‖ www.asiatraveltips.com, August 20, 2001. ―Father of Indian Hoteliering Rai Bahadur M. S. Oberoi, Turns 103,‖ www.asiatraveltips.com, August 20, 2001. Bachi J Karkaria, Dare to Dream: The Life of M.S. Oberoi, (Penguin Portfolio, 2006). 8
MS Oberoi and His Legacy
Oberoi was aware that a guest of a luxury hotel paid a premium in return for a private, exclusive and serene atmosphere. He declared that his hotels would not be let out for any wedding or parties even though it would have been a great source of revenue because it meant compromising on the comfort of his guests. For the same reasons, he even prevented the hotel‘s swimming pool from public access. Many other competitor hotels offered memberships to the public for heavy membership fees.66 He never believed in compromising on quality or price, even at times of difficulty. Oberoi believed that one mistake commonly made by people in his industry was to compromise on quality and efficiency after they established themselves and gained a reputation. He was very particular about his hotel‘s reputation and hence never compromised. Oberoi commented in his autobiography that he strove endlessly to safeguard the reputation of his hotel and this personal quality rewarded him in the form of President of Honor of the Federation of Hotel and Restaurant Associations of India for life.67 The Oberoi Hotels‘ mission, conforming to the sentiment of their founder was to constantly meet and exceed their guests‘ expectations with continuous dedication in every aspect of service.68 (Refer to Exhibit VI for the mission and vision statement of the Oberoi Group). His attention to detail and quality-consciousness translated into his personal life. His son, Bikki, spoke about his father commenting, ―He had a thing for good suits and shoes. He always wore shoes with laces and ties that were unattached. He took no short-cuts.‖69 He further added that his father bought at least three suits each time he went to England. He was always well-dressed in a well-ironed suit, even on Sundays but he never liked jewelry. He had never worn a wrist-watch his entire life and only carried a pocket-watch. Oberoi continued to be the chairman of the group till he died. It was only in the 1980s that he finally decided to distance himself a little from the operations of his hotel empire. 70 But in 1991, with the group getting into some trouble with the group having made Rs.180 million less then their sales forecast for 1990-91and Bikki recuperating in London from a major surgery, Oberoi again came to the fore briefly.71 He took charge, brought about certain changes in operation with a focus on cost cutting asking every department to cost their costs by 3 percent, and by the end of the year things again started looking up for the group.
RELATIONSHIPS WITH EMPLOYEES
Oberoi was also well-known for his relationship with his employees. He knew each employee individually and was always available and open to meet with them. Experts revealed that Oberoi firmly believed that it was his employees and not the ambience or structure of the hotel that made a difference.72 The employees almost hero worshiped him for his kindness and the one-to-one relationship he maintained with them. For instance, when he went on his world tour in 1952 he brought back small gifts for each of the employees, each of the gifts specifically chosen. He took a genuine interest in each employee and was concerned about their well-being. In the 1970s, he was said to have personally chosen land for some of his employees and ‗forced‘ them to buy it – for which these
66 67 68 69 70
71 72
―Rai Bahadur MS Oberoi: A Hotelier and a Gentleman,‖ www.financialexpress.com, May 5, 2002. ―How M S Oberoi Became India's Greatest Hotelier,‖ www.rediff.com, October 21, 2005. ―Mission and Vision,‖ www.oberoihotels.com. ―The Centennial Man,‖ http://timesofindia.indiatimes.com, September 1, 2001. ―Chairman of the Oberoi Group, PRS Oberoi TalkAsia Interview Transcript,‖ http://edition.cnn.com, November 13, 2004. Bachi J Karkaria, Dare to Dream: The Life of M.S. Oberoi, (Penguin Portfolio, 2006). ―Father of Indian Hoteliering Rai Bahadur M. S. Oberoi, Turns 103,‖ www.asiatraveltips.com, August 20, 2001. 9
MS Oberoi and His Legacy
employees were very grateful to afterwards. If there was any area his employees knew more than him, he learnt from them. Oberoi was very accessible to all the employees. ―He had a close personal connection with every employee, and kept himself open to access, sometimes even to a fault,‖73 said Bhoothalingam. Of course, this was not always welcomed by the managers who felt that his accessibility led to dilution of the chain of command. For instance, once Dieter Jansen (Jansen), the General Manager of Oberoi Sheraton fired an employee. The employee approached Oberoi and was reinstated. When Jensen protested, Oberoi said, ―By firing the man you played the role of a Sessions Judge. Mr. Bikki Oberoi is the High Court, and I am the Supreme Court. How can I run a company where there‘s no court of appeal? By the same token, I don‘t sack anyone because there‘s no one above me for the person to appeal to.‖74 However, later on, with other General Managers too complaining that it would become difficult for them to manage operations of a hotel if employees started going over their heads, Oberoi started telling those who approached him to sort out the matter with their boss. But he still continued to follow up on the issue. He used to welcome students of the Oberoi School of Hotel Management into his house for tea and he shared his experience with them. According to Sanjiv Malhotra, is vice-president of the Oberoi Towers, Mumbai, ―His house was open on Saturday afternoon for us. We would meet him informally and listen to his life story.‖75 According to Bikki, his own reliance on people was due to the influence of his father. ―[I] spend a lot of time on people - meeting people. I learned this from my father – he‘d go into the hotel and know the names of a lot of the people who were working there. Of course, we had fewer hotels in those days - the early days - we have more hotels today, so it‘s more difficult, but I try and meet as many people as I can,‖76 said Bikki in 2004.
OBEROI - THE FAMILY MAN
When he was 20 years old, Oberoi married Ishran Devi who was 15 years old. Oberoi had five children, two sons and three daughters.77 Oberoi‘s older son, Tikki died in 1984 and Oberoi‘s wife, Ishran Devi died in 1988. According to media reports, it was believed that Oberoi spoilt his children.78 His son, Bikki himself said, ―My father never bothered to find out how much money he had in his personal account.‖79 When he got to know that his sons Tikki and Bikki were spending too much, he defended them saying, ―They have a rich father, I didn‘t.‖80 Experts believed that he was a very patient father because even though his sons were criticized by others as difficult children, he adored them. It was reported that Oberoi went to a number of stores around Kolkata looking for the perfect woolen knee-high socks that his son, ‗Bikki‘ should wear to school when he was at St. Paul‘s in Darjeeling.81
73
74 75 76
77 78 79 80 81
―Rai Bahadur M S Oberoi - A Tribute to the Founding Father,‖ www.expresshospitality.com, May 20, 2002. Bachi J Karkaria, Dare to Dream: The Life of M.S. Oberoi, (Penguin Portfolio, 2006). ―The Centennial Man,‖ http://timesofindia.indiatimes.com, September 1, 2001. ―Chairman of the Oberoi Group, PRS Oberoi TalkAsia Interview Transcript,‖ http://edition.cnn.com, November 13, 2004. Bruce Palling, ―Obituary: Raj Bahadur M. S. Oberoi,‖ http://findarticles.com, May 7, 2002. ―The Centennial Man,‖ http://timesofindia.indiatimes.com, September 1, 2001. ―The Centennial Man,‖ http://timesofindia.indiatimes.com, September 1, 2001. ―The Centennial Man,‖ http://timesofindia.indiatimes.com, September 1, 2001. Sushmita Choudhury, ―Golden Moments- P.R.S. Oberoi,‖ http://archives.digitaltoday.in, July 3, 2006. 10
MS Oberoi and His Legacy
While Oberoi chose Bikki as his successor, he had also set up all his daughters in successful businesses. After Oberoi‘s death, Bikki said ―His passing away is an irreparable loss. He was my mentor, father and friend... Always a pillar of strength for the family and members of the Oberoi group.‖82 His grandson, Vikram Oberoi (Vikram) spoke about his grandfather as a perfectionist with a keen eye for detail and who always gave preference to quality over profit. Vikram added that he was warm and friendly towards his staff that could approach him anytime with their problems. When Oberoi died, he left behind a legacy and had some satisfaction that the business was in safe hands. ―The aim was to be the best and achieve it by never expecting guests to settle for second best. Biki continues this, almost with a vengeance. My daughters manage their business admirably. My grandsons are steady professionals, holding their own. My company could not be in better hands,‖83 he said a few years before his death. According to his daughter Rajrani, Oberoi achieved in his lifetime what other entrepreneurial families would take at least two generations to achieve.
CRITICISM
Although analysts praised Oberoi for his contributions to the hospitality industry many in the industry considered him a snob because he was very particular about maintaining the exclusivity of his hotel. He did not want to let it out for parties and weddings even though it would have been a good source of revenue. In 1958, Oberoi had a dispute with Sardar Bahadur, the owner of the Imperial Hotel property from whom he had leased the building.84 Oberoi, in a bid to avoid paying the entire rent from his pocket, sub-leased every little shop space in the hotel he could, to cover his lease rentals. This enraged Sardar Bahadur who ordered that his hotel be returned to him in its original state without any delay. That episode concluded the relationship between the Oberoi Group and the Imperial Hotel. Critics believed that though the Oberoi group employed a number of professionals in responsible positions, the family took all the major decisions and ‗held the reins‘.85 Experts noted that the Oberoi Group always remained in the shadow of the Taj Hotel which was owned by the India Hotels of Tata group even though the Oberoi Group was the pioneer in the industry. The reason, it was assumed, was because India Hotels catered to both business and leisure travelers and had expanded across various subsidiaries, unlike EIH. Critics also felt that the group concentrated on business travelers for its revenue and therefore, a reduction in business travel had a direct impact on the company‘s revenue. The company had not attempted to develop clientele in the leisure segment where there was great potential for growth, they said.86 Analysts also criticized EIH for expanding into unrelated areas instead of focusing in their core business which would benefit them in the long run. They pointed out that it had invested in a poultry farm and a hospital that eventually closed down because it was unsuccessful.87
82 83 84 85 86 87
―Oberoi Group Chairman M.S. Oberoi Dies,‖ www.expressindia.com, May 3, 2002. Bachi J Karkaria, Dare to Dream: The Life of M.S. Oberoi, (Penguin Portfolio, 2006). ―Oberoi Mohan Singh,‖ www.famoushotels.org, December 11, 2006. Neeti Mehra, ―Inspiring Leaders of Tomorrow,‖ www.expresshospitality.com, October 31, 2007. ―Must Catch Up with the Leader,‖ www.equitymaster.com, February 11, 2000. ―Must Catch Up with the Leader,‖ www.equitymaster.com, February 11, 2000. 11
MS Oberoi and His Legacy
THE SECOND GENERATION
Bikki took over as chairman of EIH from June 27, 2002, after the death of Oberoi, before which time he was the vice-chairman and managing director.88 As per the annual general meeting in August 2007 Bikki‘s chairmanship was extended until 2012.89 Oberoi‘s son-in-law, Khanna who was part of the Oberoi group early on, left to set up his own spa hotel called Ananda in the Himalayas which made its mark as an independent entity90. Though Bikki was pampered by his father and encouraged to enjoy life, travel to different places and experience the best of hotels, Oberoi had identified his son‘s potential in business early on and had planned Bikki‘s future around the business.91 Experts believed that Bikki‘s firsthand experience with visiting the world‘s finest hotels and experiencing the best food and wine helped him both in setting and achieving the same standard of quality in his own. ―My best year was when I was 30 for that was the time I decided that the hospitality industry was my one and only passion,‖92 Bikki recalled. Bikki had studied Law from London and had a masters in Haute Cuisine from Lausanne93. In 1960, he was credited with singlehandedly bringing the Paris super-sexy Bluebell Girls to Kolkata‘s Grand Hotel, which was an instant success and brought the hotel much fame.94 Along with Khanna, he was credited with successfully executing the international ventures of the Oberoi group. Analysts observed that like his father, Bikki was also obsessed about the smallest details like he insisted that each rosebud in each room was not taller than one and a half times the vase‘s height, was very particular about the softness of the bed linen and always imported toilet paper only from Thailand. All the Oberoi group hotels had reflectometers which were used to check the whiteness of the towels after their wash. According to Bikki, ―One must never think for a moment that customers don‘t notice anything. They do‖.95 From early on, the two sons of the Oberoi were given responsibilities in the business where Bikki took care of designing hotels while his older brother, Tikki, who was considered more of a playboy, took care of other miscellaneous details. Bikki‘s aptitude for designing and construction was highlighted with the Oberoi Hotel in Mumbai in 1986.96 This five star hotel went through a dramatic transformation from the dazzling display of lights and grandeur which other hotels displayed to a subdued and subtle elegance and class in his hotel. Circumstances changed for Bikki after his older brother ‗Tikki‘ died and he had to shoulder the responsibility of the entire business.97 Experts observed that Bikki was ambitious too and went on to build four ultra luxurious Oberoi Villas in tourist locations like Agra, Jaipur and Udaipur. Karkaria, commenting about Bikki said, he ―builds like a Mughal emperor — lavishly.‖98 Since the 1980s, Bikki was spearheading the group as Oberoi had virtually gone into retirement following the death of Tikki, attending the annual general meeting only on a few occasions. In 1988, the Oberoi group introduced a new brand of hotels called ‗The Trident‘ in the five-star
88 89
90
91 92 93 94 95 96 97
98
―Company History - EIH,‖ www.moneycontrol.com. Reeba Zachariah, ―PRS Oberoi Puts in Place Succession Plan,‖ www1.timesofindia.indiatimes.com, April 1, 2008. Reeba Zachariah, ―PRS Oberoi puts in place succession plan,‖ www1.timesofindia.indiatimes.com, April 1, 2008. Sushmita Choudhury, ―Golden Moments- P.R.S. Oberoi,‖ http://archives.digitaltoday.in, July 3, 2006. Sushmita Choudhury, ―Golden Moments- P.R.S. Oberoi,‖ http://archives.digitaltoday.in, July 3, 2006. Lausanne is a city in French-speaking part of Switzerland. Sushmita Choudhury, ―Golden Moments- P.R.S. Oberoi,‖ http://archives.digitaltoday.in, July 3, 2006. ―Meet India‘s Raja of Rooms,‖ www.themalaysianinsider.com, February 27, 2009. ―Meet India‘s Raja of Rooms,‖ www.themalaysianinsider.com, February 27, 2009. Pallavi Srivastava, ―Mister Hospitality - Vikram Oberoi,‖ www.businesstoday.intoday.in, December 24, 2007. ―Meet India‘s Raja of Rooms,‖ www.themalaysianinsider.com, February 27, 2009. 12
MS Oberoi and His Legacy
segment.99 Since its inception, Trident hotels had created a reputation for efficiency and value for money, which made them popular with leisure travelers. This and a deal with France‘s Accor Group were considered to be the pet projects of Bikki. In November 2008, Bikki was conferred Business India‘s Businessman of the Year 2008 Award in recognition of his services to the hotel industry. Bikki‘s son, Vikram and his nephew, Arjun Oberoi (Arjun), the future generation of the Oberoi group were already into the business and were being groomed to take over.100 ―[O]ur business is too big now to be family run. Vikram and Arjun really got into the business four or five years ago as they were studying abroad. So it‘s not really a family-run business anymore. We have a lot of professionals in the company -- very senior ones- they are very dedicated,‖ 101 said Bikki in 2004. As of April 1, 2008, the Oberoi family had already prepared its succession plan but intended to disclose the successor at a later date. While Bikki maintained that a company as large as the Oberoi group cannot be run as a family business and it had many thorough professionals in its ranks, insiders at the company felt that the possibility of an outsider being named as his successor was slim.102 According to industry observers, the 79 year old Bikki had no intension of retiring in the near future and he himself says, ―Somehow I can‘t imagine myself lying on a beach. I‘m afraid I‘d get quite bored.‖103
CARRYING FORWARD THE LEGACY
Arjun, son of Tikki, and Vikram were the third generation and the future owners of the Oberoi group. As of April 2008, Vikram was responsible for the operations and Arjun took care of the business development. They both held the title of Deputy Managing Directors of EIH Ltd. Like Bikki, both of them shared the attention to detail and quality-consciousness and were totally sold on the philosophy espoused by Oberoi of making Oberoi not necessarily the biggest, but the best. Vikram had completed his Economics degree from Pepperdine University in California. During this time he had worked at the hotel during summer holidays. Then he had worked for a brief period as a banker at ANZ McCaughan in Australia, before returning to join the family business in 1991.104 Since then he had been groomed in the business in many functional areas. Before joining the family business Arjun had trained at the Savoy chain‘s headquarters in London. He too had worked at various areas in the chain and was the managing director of Mashobra Resort, a subsidiary, when both he and Vikram were inducted into the EIH boardroom as deputy managing directors in August 2004. According to Arjun, the Oberoi chain of hotels planned to open new hotels in South Africa, West Asia and Seychelles within the next few years.105 Speaking about expanding their business in Dubai, Maldives, Abu Dhabi, Oman, Marrakesh and Bhutan, Vikram said, ―We feel that we have to build a luxury brand that we must expand worldwide.‖106
99 100 101
102
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105 106
―New Brand Identity of Trident Hotels Announced,‖ www.indiaprwire.com, April 1, 2008. ―Meet India‘s Raja of Rooms,‖ www.themalaysianinsider.com, February 27, 2009. ―Chairman of the Oberoi Group, PRS Oberoi TalkAsia Interview Transcript,‖ http://edition.cnn.com, November 13, 2004. Reeba Zachariah, ―PRS Oberoi Puts in Place Succession Plan,‖ www1.timesofindia.indiatimes.com, April 1, 2008. Naazneen Karmali, ―The Raja of Rooms,‖ www.forbes.com, January 12, 2009. Pallavi Srivastava, ―Mister Hospitality - Vikram Oberoi,‖ www.businesstoday.intoday.in, December 24, 2007. Prabodh Chandrasekhar, ―Oberoi to Expand in SA, West Asia,‖ www.rediff.com, April 6, 2006. Pallavi Srivastava, ―Mister Hospitality - Vikram Oberoi,‖ www.businesstoday.intoday.in, December 24, 2007. 13
MS Oberoi and His Legacy
Experts believed that they had the huge responsibility and challenge to carry the legacy that their grandfather started out seventy five years ago. According to Bikki, ―My father did a lot and we have to continue the work he started. I tell my son and my nephew who I treat like my son that they have to continue this - the stars that my father started.‖107
107
―Chairman of the Oberoi Group, PRS Oberoi TalkAsia Interview Transcript,‖ http://edition.cnn.com, November 13, 2004. 14
MS Oberoi and His Legacy
Exhibit I MS Oberoi‟s Hotel Empire – Some Key Milestones 1934 1938 1943 1944 1947 Acquires Clarke‘s Hotel Shimla with partners, his share being Rs.16,000. Soon he bought of the hotel by increasing his investment to Rs. 120,000 Starts Hotels Pvt. Limited with four partners Kahnchand Kapur, Shiv Nath Singh, Hari Ram and DW Grove to acquire Calcutta‘s Grand Hotel. Rented Delhi‘s Hotel Imperial. Hostile takeover of the Associated Hotels of India Ltd. Brought the whole Grand Hotel property by acquisition of the entire Rs. 3,452,407 worth of share capital of the holding company, Chowringhee Properties. Picked up the Palm Beach Hotel in Gopalpur-on-Sea for Rs.300,000 and the Oberoi Palm Beach was launched. 1949 1952 Creation of The East India Hotels Limited with an authorized capital of Rs. 20 million. Associated Hotels of India Ltd. Was merged with it. Picked up the Hotel Mount Everest in Darjeeling for Rs.500,000 and debenture liability of Rs.800,000 Oberoi bought off his partners in Hotels Pvt. Limited and the entity was dissolved. 1955 1956 Takes the palace Gulab Bhavan in Kashmir on lease and restores it to form the Palace Hotel. The hotel is closed since 1990. The first public issues floated for EIHL that raised Rs.6.5 million for the Oberoi Intercontinental, Delhi. This was also the first ever public issue floated by a hotel in India. Bought the Swiss Hotel opposite Maidens, Delhi. 1958 1959 1965 Dispute at The Imperial over money and the property was reclaimed by the landlord. The Oberoi Group became the first group to start flight catering operations in India. The Oberoi Intercontinental, Delhi, is opened. It was the first hotel that Oberoi had built himself. The construction for the Oberoi Hotel in Mumbai began. Oberoi loses four of his hotels in Pakistan after the 1965 war between India and Pakistan. 1966 The Oberoi School of Management is started. Entered into a collaboration agreement with Sheraton International Inc. (Sheraton). 1969 Took over the management of the palace hotel, Kathmandu Soaltee in Nepal, to launch Oberoi Soaltee. Took over the management of Singapore‘s Imperial Hotel (managed the hotel till 1986). 1972 Took over the management of Cairo‘s Mena House and The Oberoi Mena House was opened. This opened up avenues for taking over the management of other hotels such as the Al Rashid in Baghdad (which Oberoi ran for 5 years) and the Oberoi Babylon (both in Iraq).
15
MS Oberoi and His Legacy
1973
The hotel at Mumbai is opened as The Oberoi Sheraton. Started building his first hotel outside India, Lanka Oberoi.
1974
EIH entered into an agreement with the Zanzibar Government (East Africa) for providing technical and hotel operating services. An agreement was concluded with the National Corporation of Zambia for rendering operation services for a luxury hotel in Ndola. Lanka Oberoi is opened. Took over the management of the historic ‗Windsor‘ hotel in Melbourne. The Bali Oberoi is opened. Expiry of the collaboration agreement with Sheraton, the name of Oberoi Sheraton Hotel changed to Oberoi Towers Hotel. Company called Saudi Oberoi is formed. The Dammam Oberoi is opened in Dammam, Saudi Arabia. Bombay‘s The Oberoi is opened (after 15 years of them taking the lease of the land). EIH won a 10 year contract from the International Airports Authority to operate all the snack bars and restaurants at the domestic and International Terminals in Mumbai.
1975 1976 1978 1979 1980 1981 1986
1988
EIH entered into a joint venture agreement with Accor Group of France, which owned the Novotel Chain, for the construction and development of medium priced hotels in India. EIH formed a joint venture with Alfred Mc Alpine Construction Major Projects Ltd., UK, to provide construction and project management expertise for new projects.
1994
*The list is not exhaustive. Compiled from various sources.
Exhibit II Oberoi and His Many Firsts First Indian to run India‘s largest and finest chain of hotels (1944). First Indian to collaborate with an International hotel chain to create The Oberoi Intercontinental in New Delhi (1965). Created India‘s first luxury hotel, the Oberoi Intercontinental. The first to start flight catering service in India.(1959) MS Oberoi was the first Indian to employ women in the hospitality sector. Established the Oberoi School of Hotel management recognized internationally (1966). Opened the 35 storey Oberoi Sheraton (1973). First Indian to join forces with International hotel chains to attract tourists to India. First to establish a series of subsidiary consumable industries that complemented and guaranteed quality products in his Hotels. Established Mercury Travels realizing its demand and how it would complement his business (1948).
16
MS Oberoi and His Legacy
He opened the first luxury hotel in Bali. First ever public issue by a hotel company in India. First hotel venture to attract money from official institutions such as Industrial Finance Corporation. First Indian hotel venture to attract foreign investment in the form of Rs.12.4 million pledged by the USA‘s Exim bank. Compiled from various sources. Exhibit III A List of Awards and Honors for Oberoi Conferred the title of Rai Bahadur by the British Government in 1943. Included in the Hall of Fame by the American Society of Travel Agents (ASTA). Recipient of ‗Man of the World‘ by International Hotel Association (IHA), New York. Recipient of ‗Agastya Award‘ presented by the Travel Agents Association of India in 1976. Awarded ‗The Victory Pillar‘ by the Hotel and Catering Industry in 1976. Presented the ‗Escorts-NIF Man of the Year 1978 Award‘. Awarded by Newsweek as one of the "Elite Winners of 1978". Awarded the Giants International award for ‗extraordinary efforts to achieve the highest standard in pursuing excellence‘. PHD Chamber of Commerce and Industry (PHDCCI) Millennium award in the year 2000. Order of The Republic -- First Class conferred by the President of Egypt. Honorary Doctorate of Business Administration by the International Management Centre, Buckingham, UK. In 2001, the Government of India accorded him the Padma Bhushan. Compiled from various sources.
Total Revenue Earnings before Interest, Taxes, Depreciation, Amortizations and Extraordinary Items Interest and Finance Charges Depreciation Extraordinary Income (Net) Other Amortizations Profit before tax Current tax Deferred tax Fringe Benefit tax Profit after tax
Exhibit IV Financial Highlights of EIH Ltd. (2006-2007) Rupees in Millions 2006-2007 2005-2006 8,031.95 9,967.24 3,979.26 980.76 426.91 457.06 64 2,964.65 1,029.09 -102.75 33.79 2,004.52 2,923.34 867.61 408.84 1,026.42 63.85 2,609.46 815.91 -122 27.5 1,888.05
Source: EIH Ltd. 2007 Annual Report www.nseindia.com
17
MS Oberoi and His Legacy
Exhibit V List of Oberoi Group‟s Properties under Different Categories Business Hotels 1. The Oberoi, New Delhi. 2. The Oberoi, Mumbai. 3. The Oberoi, Bangalore. 4. The Oberoi Grand, Kolkata. Leisure Hotels 1. The Oberoi Amarvilas, Agra. 2. The Oberoi Rajvilas, Jaipur. 3. The Oberoi Udaivilas, Udaipur. 4. The Oberoi Vanyavilas, Ranthanbhore. 5. Wildflower Hall, Shimla in the Himalayas. 6. The Oberoi Cecil, Shimla. 7. Mena House Oberoi, Cairo. 8. The Oberoi, Sahl Hasheesh, Red Sea, Egypt. 9. The Oberoi, Bali, Indonesia. 10. The Oberoi, Lombok, Indonesia. 11. The Oberoi, Mauritius. Cruises 1. The Oberoi, Motor Vessel Vrinda, Kerala. 2. The Oberoi Philae, Nile, Cruiser. 3. The Oberoi Zahra Luxury Nile Cruiser. Trident Properties were a brand of hotels that targeted both business and leisure travelers. 1. Trident Hotel, Agra. 2. Trident Hotel, Bhubaneshwar. 3. Trident Hotel, Chennai. 4. Trident Hotel, Cochin. 5. Trident Hotel, Gurgoan (Delhi NCR) 6. Trident Hotel, Jaipur. 7. Trident Hotel, Nariman Point, Mumbai. 8. Trident Hotel, Udaipur. 9. Trident Hotel, Bandra Kurla, Mumbai was scheduled to open in 2009. *The list is not exhaustive. Source: www.oberoihotels.com
18
MS Oberoi and His Legacy
Exhibit VI Mission and Vision Statement of Oberoi Group
Our Guests We are committed to meeting and exceeding the expectations of our guests through our unremitting dedication to every aspect of service. Our People We are committed to the growth, development and welfare of our people upon whom we rely to make this happen. Our Distinctiveness Together, we shall continue the Oberoi tradition of pioneering in the hospitality industry, striving for unsurpassed excellence in high-potential locations all the way from the Middle East to Asia-Pacific. Our Shareholders As a result, we will create extraordinary value for our stakeholders. Vision We see an organization which aims at leadership in the hospitality industry by understanding its guests, and designing and delivering products and services which enable it to exceed their expectations. We will always demonstrate care for our customers through anticipation of their needs, attention to detail, distinctive excellence, warmth and concern. We see a lean, responsive organization where decision making is encouraged at each level and which accepts change. It is committed and responsive to its guests and other stakeholders. We see a multi-skilled workforce, which consists of team players who have pride of ownership, translating organizational vision into reality. We see an organization where people are nurtured through permanent learning and skill improvement, and are respected, heard and encouraged to do their best. Oberoi is recognized as best practice for training and developing its people. We see a more multinational workforce which has been exposed to different cultures, problems and situations and can use its experiences to enrich the local employees whether in India or overseas. We see the world dotted with hotels of The Oberoi Group, in strategic commercial and resort locations. We see user-friendly technology enhancing value for our customers and helping our personnel by making information more accessible. We see an organization which is conscious of its role in the community, supporting social needs and ensuring employment from within the local community. We see an organization which is committed to the environment, using natural products and recycling items, thus ensuring proper use of diminishing natural resources.
Source: www.oberoihotels.com/Mission.aspx 19
MS Oberoi and His Legacy
References and Suggested Readings:
1. “Must Catch Up with the Leader,” www.equitymaster.com, February 11, 2000. 2. ―Father of Indian Hoteliering Rai Bahadur M. S. Oberoi, Turns 103,‖ www.asiatraveltips.com, August 20, 2001. 3. ―The Centennial Man,‖ http://timesofindia.indiatimes.com, September 1, 2001. 4. Sonali Sudarshan Sokhal, ““My Secret of Longevity”,” www.the-south-asian.com, February 2002. 5. ―Oberoi Group Chairman M.S. Oberoi Dies,‖ www.expressindia.com, May 3, 2002. 6. ―MS Oberoi: Hotelier Par Excellence,‖ www.financialexpress.com, May 4, 2002. 7. Paul Lewis, “Mohan Singh Oberoi, 103, A Pioneer in Luxury Hotels,” http://query.nytimes.com, May 4, 2002. 8. ―Rai Bahadur MS Oberoi: A Hotelier and a Gentleman,‖ www.financialexpress.com, May 5, 2002. 9. Bruce Palling, ―Obituary: Raj Bahadur M. S. Oberoi,‖ The Independent, May 7, 2002. 10. ―Rai Bahadur M S Oberoi - A Tribute www.expresshospitality.com, May 20, 2002. to the Founding Father,‖
11. Paul Lewis, ―Mohan Singh Oberoi, 103, A Pioneer in Luxury Hotels,‖ http://query.nytimes.com, May 4, 2002. 12. “Chairman of the Oberoi Group, PRS Oberoi TalkAsia Interview Transcript,” http://edition.cnn.com, November 13, 2004. 13. ―How M S Oberoi Became India‟s Greatest Hotelier,‖ www.rediff.com, October 21, 2005. 14. Prabodh Chandrasekhar, “Oberoi to Expand in SA, West Asia,” www.rediff.com, April 6, 2006. 15. Sushmita Choudhury, ―Golden Moments- P.R.S. Oberoi,‖ http://archives.digitaltoday.in, July 3, 2006. 16. ―Oberoi Mohan Singh,‖ www.famoushotels.org, December 11, 2006. 17. Neeti Mehra, “Inspiring Leaders of Tomorrow,” www.expresshospitality.com, October 31, 2007. 18. Pallavi Srivastava, ―Mister Hospitality www.businesstoday.intoday.in, December 24, 2007. 19. Reeba Zachariah, “PRS Oberoi Puts www1.timesofindia.indiatimes.com, April 1, 2008. in Place Vikram Succession Oberoi,‖ Plan,”
20. ―New Brand Identity of Trident Hotels Announced,‖ www.indiaprwire.com, April 1, 2008. 21. Naazneen Karmali, ―The Raja of Rooms,‖ www.forbes.com, January 12, 2009. 22. ―Oberoi Gets Businessman of the http://timesofindia.indiatimes.com, January 17, 2009. 24. “Company History - EIH,” www.moneycontrol.com Year 2008 Award,‖
23. ―Meet India‟s Raja of Rooms,‖ www.themalaysianinsider.com, February 27, 2009. 25. ―Indian Entrepreneurs: M.S. Oberoi Profile,‖ www.iloveindia.com.
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MS Oberoi and His Legacy
26. Prakash K. Chathoth, and Kaye K.S. Chon, “Rai Bahadur Mohan Singh Oberoi: Father of the Indian Hotel Industry,” Journal of Hospitality &Tourism Education, Volume 8, Number 1. 27. ―Rai Bahadur Mohan Singh Oberoi,‖ www.oberoihotels.com. 28. www.oberoihotels.com/Mission.aspx Book: 29. Bachi J. Karkaria, Dare To Dream – The Life of M. S. Oberoi (Penguin Portfolio, 2006).
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