Executive Interviews

India

2016/6/20(Mon)15:00

(india/インド)

Elgi Equipments Limited
Mr. Jayakanthan R (Director, Business Systems and Strategy)
India

 
fb3ovr2e9amdvu6utoiu-7a524ea1.jpg Many business people from abroad including the emerging countries have participated in HIDA training programs. Positions of the targeted audience vary with the programs, and there are some programs aimed for top executives.
 
This time, we interviewed with a person who runs a manufacturer of air compressors in India.
 

-Please explain your company profile first.
 
Elgi Equipments Limited is a manufacturer of air compressors and automotive equipment, located in Tamilnadu, India, about 500 kms down south of Chennai. It was established in 1959, and is now in the leading position in India for automotive equipment and compressors. The global head count is 1,600 and there is 5 million square feet of factory land and 1 million square feet of factory space in India.
 
We manufacture 40,000 compressors (piston and screw compressors, electric powered and diesel powered compressors, lubricated and oil-free compressor) per year. Also, we manufacture automotive garage equipment. Our compressors are sold in 70 countries such as European countries, the USA, Mexico, Brazil, and so forth, and presently, there are company offices in 18 countries such as in the Middle East, Indonesia, Bangladesh, etc. And our yearly global sales amount is about 220 million USD.
 
 
-What aspects of corporate management do you put much value on? Please share with us your management philosophy or policy, or something considered important.
 
Our company’s vision is “Always be the choice everywhere”
“Always”: being included as an option in every decision by our stake holders.
“The choice”: whatever we offer must be superior so that we are the natural choice.
“Everywhere”: wherever a stake holder is, Elgi must be a natural choice.
 
We place significant importance on people and processes to achieve our objectives.
 
We have a set of seven values: Quality, Speed, Collaboration, Cost, Integrity, Sensitivity, and Innovation, which guide us, and use TQM as the platform to continuously improve our quality and processes. Combining the strength of people and processes with our global product lines gives us the right to play in various markets across the world.
 
 
-Do you think of any challenges that hinder your company business to grow and develop further? What kind of actions do you think need to be taken to address the above-mentioned “challenges”?
 
To meet our aspiration to become a significant player in the global compressors market, our revenue growth has to come much more from international sales. We have to be present in both developing and developed markets to reach the size of revenue that we are aspiring. We have to develop many key markets for our products in the coming years across various countries such as Italy, Australia, and so forth.
 
To develop key markets, we need to have global leaders and global processes in India which are transportable to markets that we need to develop, besides local resources and leadership. We now fall short in being a globally recognized brand which makes market entry difficult and takes a longer time to establish. Besides acceptance of products in various markets, it is a challenge to attract good local talent due to lack of brand strength.
 
In terms of products, we have invested heavily in the last 10 years in technology which has enabled us to make truly global products which are acceptable in both developed and developing markets with a good price positioning. Further, our investment in TQM is helping us consistently improve our quality.
 
In terms of markets, we have carefully chosen markets to focus on and been investing in these countries continuously. We have adopted direct entry into developing markets and also have used the acquisition route (M&A) to enter developed markets. We have had mixed results with both these approaches.
 
In terms of processes, we continue to invest significant resources and efforts to develop global processes within Elgi Equipments Ltd., leveraging the investments we have made in TQM over the last several years. We have to accelerate this process now and encompass non-manufacturing areas in the coming years.
 
In terms of people, we are constantly in search of talent in both home markets and overseas markets, keeping in mind our aspiration and the scale we have to achieve.  Our product strength gives us leverage to attract talent in new markets. Being an Indian multinational company is giving us the edge to attract talent in India.
 
 
-How do you view the current status of your business in the global market?
 
Large markets like the USA and Europe offer us market opportunities and changing economies have less impact on us since those markets are not growing much. Competition is severe in developing markets with all global players trying to grab market share in these regions.
 
There are certain markets where we are well received and accepted like the USA, Italy, and the Middle East even though oil production has been dampening the demand in the Middle East. Meanwhile, there are markets where we face challenges like China and Brazil. The Chinese market is dominated by local players. In Brazil, we face foreign exchange fluctuations and political instability affecting the economy and therefore the demand for products as well.
 
 
-Are you planning to expand your business overseas? What does your company consider important and wish to focus on to lead your business overseas to a success?
 
We have experimented with market entry in various countries in recent years. Based on market potential, market acceptance and organization building, we will be consolidating and focusing on key markets. Our immediate focus is to grow in markets where we are already present.
 
We try our best to continuously deliver global quality products to the customers at very competitive prices. We are promising a very high “Uptime” of our products to customers, and bring on board global talent and train people for global roles to accelerate market growth in key regions.
 
Speaking of relations with Japanese companies, we do not have much business in Japan. We import some parts for our products from Japanese companies.  We are in the process of engaging with Indian subsidiaries of Japanese companies to sell our products and services.
 
 
-What are the points that you have kept in mind to develop human resources in your company? In other words, how do you wish to improve your engagement with the matter in the future?
 
We use a two pronged approach. One is to retain the best talent available in the company, and the other is to acquire good new talent, both locally and globally.
 
With respect to having home grown leaders for global roles, we are identifying top talents in the company that will be retained and nurtured for various roles. We are using competency assessment (skill mapping) and talent development programs both in-house training and seminars and the usage of outside resources such as universities.
 
We are deputing people in our international subsidiaries in key functions and helping them learn the market and getting them ready for future roles. We are enhancing our employer brand value through active participation and improved visibility in reputed universities and institutions. Further, we are increasing our presence in professional social media like linkedin. Our growing international foot print is a good platform to attract new talent.
 
We believe these initiatives will help us attract best talent for our company.
 
 
-What is your impression about Japan and Japanese companies? Please share with us an episode or experience that surprised or touched you.
 
It was a learning experience to visit Japan. 
It is just amazing to see how things just work as planned and clearly reflects the benefits of time spent in making a good plan. The societal culture and industrial culture are well aligned. To quote, the cleanliness and orderliness of the city, street, metro station, home and the factories are of the same standard and top notch.
 
I am impressed with the hospitality and the humility that I experienced during my trip. It is very heartwarming to see the team spirit in the Japanese companies that we visited. It is nice to see that everyone is considered and addressed as a team member. Passion and pride in the team members of that companies that I visited is very infectious. The respect for human and environment is demonstrated everywhere.
 
Finally it was indeed a very pleasant experience that the hosts in each company we visited, extended us a very warm welcome, attention and waved at us and waited till we left the company. 
 
 
Thank you very much for your cooperation.

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