Focussing on customer centricity, BFW has become a successful business enabler. CEO Ravi Raghavan spells out his success mantra | by Indira Rao |
Automobile sales in India tip in favour of diesel vehicles. Diesel cars may cost, pollute, weigh more but they also save the user precious rupees every kilometer of the drive. Improving the diesel engine is much wiser than ignoring or shunning it, one would think. It was perhaps this thought that made a leading global carmaker expand its product range with diesel cars. The experiment in UK was successful and the carmaker decided to replicate the experience in India last year. It was decided that the diesel car manufactured in India would have Indian engines made on the original design.
The carmaker realised that a number of world-class machining centres would be required for machining the cylinder block and the cylinder head. Many of these machining centres would have to be tailor-made to meet the nuances. Not only would the machining centres have to be extremely reliable, but the service support too would have to be impeccable. Further, all machines would have to be supplied, erected, commissioned and put to mass production within a tight schedule. While the total line would perhaps consist of 30-odd machining centres, 26 of them came from a single source. These included nine special machines and 17 horizontal machining centres. True to the requirement, the machines were engaged in production within nine months from the placement of the order. This was one of the largest orders for machining centres released in recent past in India by an automobile manufacturer. It was also one of the largest machining centre orders received in the recent past by the machine tool manufacturer, Bharat Fritz Werner (BFW) Ltd. And leading this enterprise is Ravi Raghavan their CEO.
Raghavan, who took over six months ago, is all set to create new benchmarks for a company that has been in operation for more than five decades. With many firsts attached to its name like designing India’s first CNC boring and milling machine in 1980 and being the first Indian supplier of machine tools to Maruti to being the first Indian machine tool manufacturer to receive the ‘India Design Mark’ for two of their machines, the company hardly needs any introduction. Agreeing Raghavan says, “The BFW foundation is strong. It has a 50-year history. The only thing that I will do is to impart a new flavour. The ice-cream remains the same.” That the industry is going through a slowdown is a given and, according to Raghavan, the uncertainty is here to stay. “We don’t want to make the mistake of not recognising the economic climate. The biggest thing that we are doing as an organisation is acknowledging it and by doing that we are preparing ourselves to overcome it.” The company has adopted certain measures to become more responsive, flexible and leaner. “This approach will enable us to become more flexible to the changes in the environment. Our aim is to make it easy to do business with BFW. The primary focus of this approach is to improve the engagement of the employees with the organisation. This helps us redefine our visions,” asserts Raghavan.
It has often been said that tough times bring about more collaboration and innovative business intelligence and that is exactly the philosophy that BFW has been applying. Raghavan believes that this is a time for ideas to be nurtured and implemented. In an effort to encourage this practice he personally spends time every month with all the divisional heads to hear them out. Many thoughts/ ideas generated in these meetings are now being converted into projects. The second thing that the company is doing is spreading across sectors. “There are certain industries where we have not focused much on — aerospace and energy being a couple of them. Both the industries are not going through a growth phase and therefore probably do not add glamour. But I feel that maybe that is why this is the best time to focus more on these. When they are on a high, to get into the growth path is difficult and hence supporting the industry in applications that we can give solutions to, is going to be the key for us,” avers Raghavan. The company also wants to get involved more with their stakeholders like the vendors. BFW is on a path to develop vendor clusters. This initiative of theirs is called ‘Jagruti’ (the awakening).
Recognising the importance and power of the cluster, ‘Jagruti’ is aimed at realising BFW’s Vision 2020 through a cluster programme for supply partners in the same value chain. Each cluster member of Jagruti is groomed in a personalised and focused manner to stand up to the challenges of the Next-Gen standards of excellence and the BFW requirements under global standards of excellence. The first batch consisted of 12 vendors, cutting across product ranges based on criticality. These vendors were imparted education and training on housekeeping, quality tools and techniques, and problem solving methodologies through classroom sessions and onsite demonstrations. The significance of achieving excellence in quality, cost and delivery was also stressed upon. The programme is in its second phase now with a fresh batch of vendors. “Through this exercise, we engage them more with our product developments. Thus, they will be a part of us before and not after the product has been developed,” asserts Raghavan.
Another area of focus for the company is innovation. “Easy said, that’s a nice word to use. But by innovation I don’t mean designs only. I mean creating an environment within the organisation to foster innovation,” opines Raghavan.
For a CEO like Raghavan it is indeed easy to say that he is not concerned with design because he knows that his team is capable of designing even the impossible. BFWs shopfloor is spread across 17 acres and houses seven different divisions with each having its own R&D centre. The CNC milling machines, special purpose machines and machining centre divisions, are however, those that rake in the money. Raju Sagi, vice-president, machining centres division, BFW, avows, “We are the first private sector company to make horizontal machine centres. We have various configurations of machines catering to small as well as big size corporate industries. Our smallest machine size is 400 x 400 and the biggest is 1250 x 1250. In fact, we recently exported a 1250 x 1250 high-end machine to Germany.” Currently the division is in the process of introducing their smallest machine, which is 320 x 320 in size. “As of now there are only Japanese machines available in this size and because of its high speed, the machine is quite popular. We would probably be the first in India to introduce such a machine,” declares Sagi.
For the machining centre division it is the material cost as well as the product basket that keeps them growing and overcoming issues such as slowdown. Moreover, maintaining an inventory flow during such times is very important. Seconding the same, Rajesh Agte, associate vice-president, CNC milling machines division, BFW, asserts, “Due to fluctuations and cyclic markets we have observed that there is a huge difference in the changeover time. For instance, earlier the changeover between planning and the execution was roughly around 20%. Since the last two years it has been above 45-50%. When there is such a wide changeover then the inventory needs to be monitored very thoroughly. That is what is putting pressure and this is true for the entire machine tools industry.”
The division has a modelwise flow where the line layout has been made considering the flow of volume. The company has two series viz. BMV45 and BMV60, out of 8-10 major VMC variants that contribute to more than 65% of the turnover of the division. “We are also trying to become more dependent on our bought outs and are trying to see if we can get into sub assemblies. This will help us save time and manage the material flow. At one end, when we are increasing our product basket, the fluctuations in the market put excessive pressure on the entire supply chain. So the first thing to do is to move towards whatever standardisation is possible. The other is to work with good vendors and ensure that they try to give us sub assemblies. This initiative has been taken up in a big way by us this year,” asserts Agte.
The special purpose machines division, as the name suggests, caters to special requirements of the customer. This is intense engineering because it’s quite unlike a standard product. Praful Shende, head, special purpose machines division, BFW affirms, “For us every product is a challenge as every time it is something new. We involve the customer at every stage. In fact, we call them here while designing the machine so that they can see for themselves the components that go into making it.”
He further adds, “Our job here is to be a part of the customer’s success all the time. There is nothing like isolated success; with our solutions if we make the customer successful, then we have the opportunity to serve the customer more than once. The whole business is focussed on the needs and wants of the customers. One of our biggest successes was making a 22-yard heat exchanger pipe chamfering machine for BHEL.”
Until last year the company’s largest customer base was the automotive sector. Today it’s the agriculture industry — tractor division. Apart from that defence, general engineering, die and mould and power are some of the major segments which the company caters to. The division apart from catering to the biggies also caters to the tier I and II suppliers. “It makes more sense for a smaller guy to have a special purpose machine rather than a standard machine because he has more constraints. And per se, I would say with special purpose machine one tends to work with fewer numbers of customers because you need to understand the customers in depth,” opines Shinde.
Customer centricity is a part of the company’s DNA. Every action of theirs is in response to the needs and wants of their customer. In order to make their orders absolutely free of any glitches, the company also trains their sub contractors and purchase personnel who make the components that go into the machine. Elucidating on the concept, HK Birla, president, operations, BFW says, “The customer is our ultimate focus. As a company we might be perfect but we do not work alone. There are external sources such as vendors, suppliers, etc. whom we have to depend upon too. If they miss something ultimately the product suffers. Hence, we decided to train everyone in the supply chain and hone their technical skills.”
The company is constantly thinking of ways to make the customers lives easier. This not only applies to their domestic customers but also to the ones abroad. In fact, BFW recently won an award for their export figures. Raghavan has plans to put a lot of thrust on exports in the coming years. Elaborating on his plans, he says, “I won’t call it exports. I would like to term it as spread of geography. The difference is that in exports, we might target countries that are easy to sell in. In spread of geography, we end up picking easy as well as difficult countries; for example, Europe. In the machine tool industry, that’s the most demanding region. I have two meanings attached to exports – one of course is the commercial aspect, the other is the challenge.”
Raghavan believes in delivering abroad the same products that are made for the domestic market. “Everytime we want to benchmark against the best, like say a Europe, there are so many things to learn. This will keep us on our toes without becoming complacent. Currently we are looking at China, US, Russia, Thailand, and Middle East apart from Europe.”
In the near future, apart from exports, the company will also look at increasing its tech centres. Currently they have tech centres in Bengaluru and Pune. “We are looking at expanding the applications at the Pune centre to cater to sectors like the die and mould apart from automotive. By next year, we might also open one in the North,” states Raghavan. With productivity being the primary focus of the organisation, it looks at a fairly good bottom line growth and a small top line growth by the end of the financial year.