Archive for September, 2010

Bajaj: Amazing comeback

September 25, 2010

“Bajaj Auto”. is a prominent name in Motorcycles today. But rewind Back 15 years and perhaps even in ur wildest dreams u wouldn hav imagined this much growth and market share for Bajaj. During early days(1984)Bajaj

Auto’s major field was Scooters. Its was considered the King in Indian Scooter industry. It had a collabration with Kawasaki to introduce motorcycles. They produced the famous KB 100 series competing against range of 2-stroke bikes and mainly the RX-100 from Yamaha. Those were the times when the Indian economy was a closed one, where it was very difficult for foreign player to enter the Market.

But the liberalisation of our economy in 1991 opened up new avenues as well as incresed competition for most of Indian companies. Bajaj was headed by its founder and CEO Mr. Rahul Bajaj at that time. He became famous as head of the Bombay Club, opposing liberalisation till there was a level playing field for Indians and foreigners.The Bombay Club managed to slow liberalisation but could not stop it. Moreover, liberalisation brought the threat of cheap imports and FDI from top companies like Honda. Meanwhile Indians began to prefer motor-cycles to scooters, and Bajaj Auto could not touch Hero Honda in this field. Bajaj had released the K bajaj 4S champion which took of well only to lose to Hero Honda. Its K bajaj Boxer AT also failed miserably with HH launching Splendour which was a run away hit(still running now).Kawasaki also parted leaving the future of Bajaj motor cycles a big question mark.Scooter sales continued to plummet, the recession and stock market collapse of 2001 hit the company hard, and some stock market analysts thought it was doomed.

It was the time Mr. Rajiv Bajaj, Rahul’s eldest son, came back to India from business school in the US. He took a hard look at the company and came to very different conclusions. He saw that Rahul’s ambition of becoming world No. 1 in scooters was irrelevant in a global economy where motor-cycles ruled supreme, and that the company needed to change its strategy accordingly. What followed was a stunning peice of turn around which has all criteria to get into the best books of Strategic Management!!!.

His startegy was simple yet path breaking. When u have a competitor so strong as HH dont compete in his domain of strength. The 100cc market was HH strength. Repeated attempts to compete in that space by Caliber, Boxer AT didnt make much of a difference. That was the time they decided to launch something new, perhaps create a new market. The concept was Pulsar began to grow. The Pulsar underwent almost 2 years of R&D. After so much of efforts and sweat Pulsar was launched in 2001 in two variants. 150cc and 180 cc. For the first 3 months the bike was termed a failure. I remember my Friend booking Chennai city’s 3rd P-180 and we all ridiculed and laughed at him saying “u hav brought a failure model.CBZ rules always!!!”. But the performance was jus awesome. The power it could generate, the macho looks, the huge tank, it was like a Wresler. A well-oiled Wresler. Gradually the sales began to pick up by the end of 8 months, Pulsar was considered a Huge hit with P-150 leading the way. Pulsar instantly became the fav of all collage lads. The result was so obvious in the Stock prices.

The dream did not stop with that, having created and captured the upper market(more than 150cc). Bajaj immdeiatly revamped its older model The Boxer At. It did some face lift and rechristened as Bajaj Boxer CT. The pricing played a important role here. When all HH model were priced higher, the Boxer CT was made available at 34k odd. The diff in price for CT and Splendour was a whopping 10K. Slowly it began eating the market share of HH. But HH was still going good with its splendours, Passions and CBZs.

The masterstroke which Bajaj had planned yet failed was the Calliber 115 and Wind 125!!!. Yes Bajaj’s ploy was not to directly attack a strong competitor but to close all his ways and then kill him by cornering!!. Bajaj already had a Upper market(CBZ sales soon dwindled due to poor mileage), it was growing in the lower end 100cc market. Its aim was to capture the 110-125 cc market so that customers are left with more alternatives from Bajaj. But sadly the only thing that clicked for those two bikes were its marketing campagins.This provided the HH some way out which had lately realised the submerged threat from Bajaj.

The R&D of Bajaj then came up with a jem of reaserch – The DTS-i (Digital Twin Spark ingnition). The DTSi technology incorporates twin sparkplugs at either ends of the combustion chamber for faster and better combustion. Single sparkplug meant slower burning of the air-fuel mixture and sub-optimal combustion chamber characteristics. Soon the Pulsar DTSi was launched with the much needed front fairing. It was a craze then. The snail paced HH was still running its splendours and passions, but took some intiative and launched the Super Splendour and Glamour.(both 125cc bikes).This space where Bajaj had let off briefly, only to come back stronger with its Discover 125cc. This also had the DTSi technology.

The Pulsar then launched the stuningly handsome Pulsar Version 3 with a low flung head peice, smashing alloys wheels and a new rider position. It aslo improved the suspension system with gas filled(Nitrox) shock absorbers. Bajaj very strongly captured the upper segment market share, competing the likes of HH Karizma and new entrants Honda Unicorn, and the TVS Apache.

The latest Pulsar version(4) has new designed heald light, A LED(Light Emmiting Diode – faster response time than ordinary bulbs)tail lamp, A LCD Digital Speedo wih Odometer. Unbreakable indicators, car like indicator turn switch. Though the latest bikes form TVS (RTR), Honda(Unicorn) and HH(Extreme) are also very good bikes and are competing for the space orginally created by Bajaj.

What is more important is the way these two companies hav taken their businesses about. While HH was leathargic for most time, Bajaj had been constantly innovating. The splendour was a splendour for more than 10 Years now. but the Pulsar has undergone 4 upgradations in 5 years. Yes, there may be some quality issues, but Bajaj didnt produce motorcycles from the time Honda, Suzuki or Yamaha started. For an Indian company to have taken up these forigen gaints head on and winning it is something really great. The stock prices for Bajaj as of now is 2 times higher than HH.

One need not be a proud Indian only when we win a cricket match against Pakistan or winning a Hockey world cup. U can proud of this Indian who had made a company resurge after everybody closed their doors on it. I am not saying Pulsar is a great bike or Bajaj is a great company, No, my intention is not that. There are bikes in India which are far more superior and refined than Bajaj bikes. Infact i dont own a Bajaj or i am not planning to own one!!. But i want u to appreciate the guts and brillance of Bajaj’s strategy. I want u to know how much efforts was put in at a difficult time to bring out the pulsar. Its a star for Bajaj.

Always remember, “Its not great to take up horses and train them to race. Its about taking in donkeys to race against horses and winning it too!!!”.

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September 17, 2010

IN 1974 (Worth a read..) by Nitesh Chandra Mani on Saturday, September 11, 2010 at 6:14pm This is the stuff legends are made of..Worth a read.. THE GIRL WRITING AS HERSELF…. It was probably the April of 1974. Bangalore was getting warm and gulmohars were blooming at the IISc campus. I was the only girl in my postgraduate department and was staying at the ladies’ hostel. Other girls were pursuing research in different departments of Science. I was looking forward to going abroad to complete a doctorate in computer science. I had been offered scholarships from Universities in the US… I had not thought of taking up a job in India. One day, while on the way to my hostel from our lecture-hall complex, I saw an advertisement on the notice board. It was a standard job-requirement notice from the famous automobile company Telco (now Tata Motors)… It stated that the company required young, bright engineers, hardworking and with an excellent academic background, etc. At the bottom was a small line: ‘Lady Candidates need not apply.’ I read it and was very upset. For the first time in my life I was up against gender discrimination. Though I was not keen on taking up the job, I saw it as a challenge. I had done extremely well in academics, better than most of my male peers… Little did I know then that in real life academic excellence is not enough to be successful? After reading the notice I went fuming to my room. I decided to inform the topmost person in Telco’s management about the injustice the company was perpetrating. I got a postcard and started to write, but there was a problem: I did not know who headed Telco I thought it must be one of the Tatas. I knew JRD Tata was the head of the Tata Group; I had seen his pictures in newspapers (actually, Sumant Moolgaokar was the company’s chairman then) I took the card, addressed it to JRD and started writing. To this day I remember clearly what I wrote. ‘The great Tatas have always been pioneers. They are the people who started the basic infrastructure industries in India, such as iron and steel, chemicals, textiles and locomotives they have cared for higher education in India since 1900 and they were responsible for the establishment of the Indian Institute of Science. Fortunately, I study there. But I am surprised how a company such as Telco is discriminating on the basis of gender.’ I posted the letter and forgot about it. Less than 10 days later, I received a telegram stating that I had to appear for an interview at Telco’s Pune facility at the company’s expense. I was taken aback by the telegram. My hostel mate told me I should use the opportunity to go to Pune free of cost and buy them the famous Pune saris for cheap! I collected Rs30 each from everyone who wanted a sari when I look back, I feel like laughing at the reasons for my going, but back then they seemed good enough to make the trip. It was my first visit to Pune and I immediately fell in love with the city. To this day it remains dear to me. I feel as much at home in Pune as I do in Hubli, my hometown. The place changed my life in so many ways. As directed, I went to Telco’s Pimpri office for the interview. There were six people on the panel and I realized then that this was serious business. ‘This is the girl who wrote to JRD,’ I heard somebody whisper as soon as I entered the room. By then I knew for sure that I would not get the job. The realization abolished all fear from my mind, so I was rather cool while the interview was being conducted. Even before the interview started, I reckoned the panel was biased, so I told them, rather impolitely, ‘I hope this is only a technical interview.’ They were taken aback by my rudeness, and even today I am ashamed about my attitude. The panel asked me technical questions and I answered all of them. Then an elderly gentleman with an affectionate voice told me, ‘Do you know why we said lady candidates need not apply? The reason is that we have never employed any ladies on the shop floor. This is not a co-ed college; this is a factory. When it comes to academics, you are a first ranker throughout. We appreciate that, but people like you should work in research laboratories. I was a young girl from small-town Hubli. My world had been a limited place. I did not know the ways of large corporate houses and their difficulties, so I answered, ‘But you must start somewhere, otherwise no woman will ever be able to work in your factories.’ Finally, after a long interview, I was told I had been successful. So this was what the future had in store for me. Never had I thought I would take up a job in Pune. I met a shy young man from Karnataka there, we became good friends and we got married. It was only after joining Telco that I realized who JRD was: the uncrowned king of Indian industry. Now I was scared, but I did not get to meet him till I was transferred to Bombay. One day I had to show some reports to Mr Moolgaokar, our chairman, who we all knew as SM. I was in his office on the first floor of Bombay House (the Tata headquarters) when, suddenly JRD walked in. That was the first time I saw ‘appro JRD’. Appro means ‘our’ in Gujarati. This was the affectionate term by which people at Bombay House called him. I was feeling very nervous, remembering my postcard episode. SM introduced me nicely, ‘Jeh (that’s what his close associates called him), this young woman is an engineer and that too a postgraduate. She is the first woman to work on the Telco shop floor.’ JRD looked at me. I was praying he would not ask me any questions about my interview (or the postcard that preceded it). Thankfully, he didn’t. Instead, he remarked. ‘It is nice that girls are getting into engineering in our country. By the way, what is your name?’ ‘When I joined Telco I was Sudha Kulkarni, Sir,’ I replied. ‘Now I am Sudha Murthy.’ He smiled and kindly smile and started a discussion with SM. As for me, I almost ran out of the room. After that I used to see JRD on and off. He was the Tata Group chairman and I was merely an engineer. There was nothing that we had in common. I was in awe of him. One day I was waiting for Murthy, my husband, to pick me up after office hours. To my surprise I saw JRD standing next to me. I did not know how to react. Yet again I started worrying about that postcard. Looking back, I realize JRD had forgotten about it. It must have been a small incident for him, but not so for me. ‘Young lady, why are you here?’ he asked. ‘Office time is over.’ I said, ‘Sir, I’m waiting for my husband to come and pick me up.’ JRD said, ‘It is getting dark and there’s no one in the corridor. I’ll wait with you till your husband comes.’ I was quite used to waiting for Murthy, but having JRD waiting alongside made me extremely uncomfortable. I was nervous. Out of the corner of my eye I looked at him. He wore a simple white pant and shirt. He was old, yet his face was glowing. There wasn’t any air of superiority about him. I was thinking, ‘Look at this person. He is a chairman, a well-respected man in our country and he is waiting for the sake of an ordinary employee.’ Then I saw Murthy and I rushed out. JRD called and said, ‘Young lady, tell your husband never to make his wife wait again.’ In 1982 I had to resign from my job at Telco. I was reluctant to go, but I really did not have a choice. I was coming down the steps of Bombay House after wrapping up my final settlement when I saw JRD coming up. He was absorbed in thought. I wanted to say goodbye to him, so I stopped. He saw me and paused. Gently, he said, ‘So what are you doing, Mrs. Kulkarni?’ (That was the way he always addressed me.) ‘Sir, I am leaving Telco.’ ‘Where are you going?’ he asked. ‘Pune, Sir. My husband is starting a company called Infosys and I’m shifting to Pune.’ ‘Oh! And what will you do when you are successful.’ ‘Sir, I don’t know whether we will be successful.’ ‘Never start with diffidence,’ he advised me ‘Always start with confidence. When you are successful you must give back to society. Society gives us so much; we must reciprocate. Wish you all the best.’ Then JRD continued walking up the stairs. I stood there for what seemed like a millennium. That was the last time I saw him alive. Many years later I met Ratan Tata in the same Bombay House, occupying the chair JRD once did. I told him of my many sweet memories of working with Telco. Later, he wrote to me, ‘It was nice hearing about Jeh from you. The sad part is that he’s not alive to see you today.’ I consider JRD a great man because, despite being an extremely busy person, he valued one postcard written by a young girl seeking justice. He must have received thousands of letters everyday. He could have thrown mine away, but he didn’t do that. He respected the intentions of that unknown girl, who had neither influence nor money, and gave her an opportunity in his company. He did not merely give her a job; he changed her life and mindset forever. Close to 50 per cent of the students in today’s engineering colleges are girls. And there are women on the shop floor in many industry segments. I see these changes and I think of JRD. If at all time stops and asks me what I want from life, I would say I wish JRD were alive today to see how the company we started has grown. He would have enjoyed it wholeheartedly. My love and respect for the House of Tata remains undiminished by the passage of time. I always looked up to JRD. I saw him as a role model for his simplicity, his generosity, his kindness and the care he took of his employees. Those blue eyes always reminded me of the sky; they had the same vastness and magnificence. (Sudha Murthy is a widely published writer and chairperson of the Infosys Foundation involved in a number of social development initiatives. Infosys chairman Narayana Murthy is her husband.) Article sourced from: Lasting Legacies (Tata Review- Special Commemorative Issue 2004), brought out by the house of Tatas to commemorate the 100th birth anniversary of JRD Tata on July 29, 2004 .

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