NHRD Bangalore organized a very interesting evening discussion on 23rd February 2017 in which the former and current senior executives of Asian Paints participated. The discussion sought to unravel the secrets of success of the 75-year-old, home grown Indian Multinational having 25 manufacturing units and operating out of 19 countries. The initiative for the same was taken by the President of the Chapter Mr. Bala Balachandar who is himself a former executive of the company.
In his brief
introduction, Bala said that he got spontaneous response from his former
colleagues when the idea was mooted for sharing their experiences and insights gained
from working for Asian Paints. He acknowledged the presence of veterans as well
as younger employees in the audience who had come in large numbers to
participate in the discussion. The baton was then passed on to Mr Sudesh Shetty
who has earlier served as president of the chapter, to initiate and conduct the
proceedings of the evening.
Sudesh
described Asian paints as a nursery for
leadership, recruiting talent from the campuses and then nurturing and developing them at each stage. He also referred to it as a company with innovative marketing
practices. Sudesh invited to the dais the members of the discussion panel
namely Mr Amitabh Sinha, Mr Jalaj, Mr Ashish and Mr Sundareshan.
Some information
gathered from the opening remarks of the panelists are the following. The company
has encouraged executives to make cross functional moves and gain experience in
diverse areas. As for example, sudesh moved from a sales to HR role while
sundareshan moved from the plant in India to a foreign assignment in Egypt as
the unit in charge. When the panelists moved to other companies, whether it is
in a very different industry of Fashion retail with Aditya Birla or to the JSW
group, their experience with Asian paints stood them in good stead, in dealing
with the challenges of the new assignments.
Asian Paints is a company that has not made a
loss even for one year in its 75-year history. Described as the Don Bradman of
Indian industries by a panelist, It is the top Ranked Indian company in the
“Forbes Most Innovative company List” in 2016(Ranked 18th in the world). The
company has been able to groom many leaders from within the organization. The
CEOS of many companies have come from the stables of Asian Paints.
The questions
put by the moderator Sudesh and their replies are given below:
Question to Jalaj: What is the secret of success of the company,
which has celebrated 75 years on 1 February? What are the respective roles that
people play to achieve this?
Answer: The story of Asian Paints have been
that of a story of people. Having smart people has always been a priority.
Focusing on all aspects of the company while empowering people and excelling in
certain business strategies has been the key.
Started in
1942, in a small garage in Mumbai by four friends, Asian Paints came a long way
and became a market leader by 1967-68. The company was however open to learning
from others. The founding fathers recognized the importance of getting the best
talent and looked towards IIMs and other institutions to meet this need. Every
idea that comes from the employees for improvement or development is
consistently looked into. Asian Paints had a flat organization structure even
in the sixties and seventies with employees having easy access to senior
management. They have a lot of freedom to try out ideas in the best interests
of the organization. Later, these practices evolved as principles over a period
of time.
Question to Amitabh: What does Asian Paints do to develop leaders?
Answer: The Company has always given priority
to the leaders being operationally fit managers, meaning they should have their
basics right and be aligned well to be able to work harmoniously with other
departments rather than be in a conflict mode all the time. Sound managers with
a long-term perspective and being able to stand the test of time has been the
focus of the organization.
Question to Ashish: You had moved to Aditya Birla from
Asian Paints and have been credited with organizational transformation
initiatives there. Could you compare and contrast your experiences and learning
in the two companies?
Answer: I worked for only six years in Asian
Paints followed by twenty years in Aditya Birla. Therefore, a direct comparison
may not be appropriate. However, one can say that the core of both companies,
in terms of values are similar.
My initial
stint in Asian paints at Guwahati was during the insurgency days. The tough
situations that I encountered at that time dealing with contract labour and
other issues steeled me for future challenges. I believe that all this helped
me in becoming president at a young age of 39.
Both the
companies valued and developed grounded leaders giving importance to the nitty
gritty and shaping the character of managers. Contributing quietly and
practical decision making was important in both companies.
Question to Sundar: You have come to be known in the
company circles as ‘remarkable Sundar’. From an assignment at the plant, level
in India, the company sent you to Egypt on an international posting instead of
looking for local talent. How did you cope, considering it was your first
posting abroad?
Answer: Asian paints had always had a
reputation of exposing and preparing its managers for various roles. It was a
strategic decision of the management to go for an acquisition in Egypt instead
of a green field project. I had experience in the company although not all of
it relevant to the new assignment. Yet the company reposed trust and confidence
in me. Asian paints is known to provide challenges and let the employees figure
out what needs to be done. Everyone is given this space; four of us had gone to
Egypt. It was clear that it was my territory and there would be no interference.
Resources were provided but decisions were my responsibility.
Question to Amitabh: Tell us about the recruitment process
in Asian Paints and what has changed over the years?
Answer: Asian paints, traditionally have
been going to the college campuses of premier educational institutions for
recruitment. The objective was to select those who have done well academically,
are hardworking and have a need for achievement. Typically, the candidates
preferred were meritorious, middle class, not too flashy or abrasive. We looked
for those with a point of view and would defend it.
Here Jalaj added: The candidates preferred were those
exhibiting humility, empathy, with listening and connecting skills. We looked
for the same basic qualities in those selected to work on the shop floor as
well. Other abilities sought were process orientation with willingness to
execute in any area.
Today the
company is in need of out of the box technology; having diversified from
manufacturing to services, technology space, and decoration bathroom business.
Now, we will also need people who will go and set up business and have better
soft skills. They would need to take risks and be able to push the manager (Middle
managers could become complacent and prefer the status quo).
Question to Ashish: What did Asian paints not teach you?
Answer: As mentioned earlier, I had a comparatively
short stint of six years in AP. The supply chain distribution was very good in
the company. Later I applied these principles in the fashion business as well However,
I found the new business was very complex, changing every moment. There were
more than 10000 products with shelf life of 3 months and consumer’s life of 10
seconds. While analytical thinking worked for me in previous assignments and
helped me become general Manager, President, CEO I found that in the new
industry of fashion more of right brain thinking was essential and that you are
as good as your last product.
Question to Sundar: You moved to a seemingly very
different field of private equity and was quite successful. What is that you
picked up at Asian paints that you were able to profitably use there?
Answer:
The risk
taking exposure that I got in Asian paints handling domestic and international
business came in handy in private equity for value creation and long-term
perspective. In the private equity role, it enabled me to look at different business
sectors be it restaurant, pharma or other sectors.
Question to Jalaj: Companies like GE and Unilever have
made a mark internationally by their contribution to best practices in HR. When
will we see the practices of Asian paints included in HR text books?
Answer: Generally, at Asian paints we have
been reluctant and uncomfortable speaking about or projecting ourselves. In
respect of HR, our focus has always been on hiring good people with a long-term
perspective and giving them diversity of experience. Our challenge and focus as
we become more and more global would be to see how we harness further this
diversity of experience.
The floor was then thrown open to the
audience to shoot questions. One particular question that I found very relevant
and interesting was on the company
culture in respect of which the following matters were discussed.
Ownership: One of the panelists gave insights
into this aspect of the work culture in the company by sharing an anecdote.
Once a visitor to the shop floor stated “I want to meet the company.” A person
in the level of a supervisor had no hesitation in declaring, “I am the company.
What can I do for you?” This kind of a response is possible only when the
management empowers employees and they in turn exhibit the ability and
willingness to accept the responsibility.
Integrity: In this connection a story was shared
of the time, company had announced the launch of a new product of automotive
paint- APCA which required separate go downs for storing and obtaining license
from explosives department of the Government. Although the date of the launch
was notified, the company decided to postpone the launch rather than pay money
to the department to obtain license, which was being delayed by the
department.
Emotional bond with company: A panelist revealed that the
employees of Asian paints had a high level of emotional bond (95%) with the company. This is borne out
by the fact that a large number of former and present employees turned up to
attend the evening program in which the company was being discussed. As many as
250 former employees of the company registered with the What’s app group in two days on learning about the
program.
Engagement with employees: The persons in leadership roles in
Asian paints gives attention to coaching, mentoring and imitating conversations
with their people. He or she is accountable for the team, appraising their performance,
engaging with them, standing up for them and adding value in all conversations.
Delegation of authority at various
levels in the organization: On this subject, Sundar already shared about how he received
full freedom during his assignment and posting to Egypt.
A former
employee who was present among the audience related another relevant story. He
was responsible for a role that included taking decisions on paint replacement
given to contractors. On one occasion, the contractor demanded 6 litres of
paint while he felt that 3 litres were sufficient to carry out the specific
work. Although the contractor took up the matter with higher levels, the
company stood by his considered decision. It is instances such as these that
boosts the morale of employees. It enhances their willingness to stick their
necks out and take risks for the benefit of the organization.
As a
blogger, it gives me a lot of happiness to report on best practices of good
companies. However, this time my cup of joy was full and overflowing as I was
reporting on the success factors of an Indian multinational, which has made a
mark for a sustained period of 75 years. It is wonderful to know that the
company has its heart in the right place and cherishes important values; values
that distinguish the good from the great….
