Glimpses of DISHA 2016

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DISHA has been IIMM’s signature program. As usual it attracted a galaxy of speakers from well-known organisations who shared their experience, which was extremely enlightening. Team IIMM had taken lot of efforts to define theme of DISHA this year and the impact was proved by high attendance and quality of speakers who participated in the forum.

There are lots of take aways that would be useful to summarise.

Manufacturing in recent times has been overtaken by Services and it has contributed significantly to GDP of the country but the real strength of a country would be demonstrated if manufacturing regains its original splendour. Mr. Seshadri Chari took us through the challenges and the history of manufacturing industry which today is a laggard. The key point he raised was that we need to put “ease of business” back in the stream and that is the key challenge the country faces today.

Independently speaking, the Honourable Minister of Industries for Maharashtra, Mr. Subhash Desai took up precisely that same subject on how the government is committed to enabling ease of business by reducing what I call in engineering parlance, the gate for decision taking, by reducing the number of steps or compliances that an organisation needs to pass through, thereby providing the necessary business stimulant. That’s very vital.

This is a huge subject of course as many of the industries are very vulnerable and we saw very animated discussions about the vulnerability of Pharma business vis a vis China and this very point came again and again in all presentations. This in fact reinforces the relevance of “Make in India” with its 25 chapters. Although Mr. Desai touched up more on the infrastructure, transportation- all chapters are important. This political will raises hopes for all of us as I see.

Reliance always has Midas touch in whatever they have done. I was reading a book “Gas Wars” that has chronicled the way they have moved up to reach dizzy heights. Mr. Narayan shared about Innovative Strategies they have adopted over the entire EPCI cycle-the entire value chain, and for me, who comes from this particular line of business, understands very well what they have done.

The most important take away as I could see is that they have created gold out of rejects of refinery by using different strategies such as Disruptive Contracting. I am deliberately using the term Disruptive Contracting which involves mitigation vis a vis the contractors, with proper IP protection buy the latest technology and leverage the economies of scale (what we call in SCM as small scale category management) with scale that is unheard of. I think a book can be written on what Reliance had done.

We had a session which covered up a very relevant subject on Organisational Redesign. I would also call it as Process Re-engineering, from Lafarge and Tata Steel. It also rekindled a debate on pros and cons of centralisation v/s decentralisation and how hybrid model was brought by Lafarge with selective autonomy going across its ranks, it was extremely innovative. Tata’s shared that with the new MIP regime that has kicked in, although it covers only small percentage, how they intend to leverage. It was heartening to hear about how an Indian giant is managing business that has hugely fluctuating steel and commodity prices.

Mahindra presented their concept of agility built into their business and how supply chain adapted itself to match the changing demographic challenges in the market. They leveraged the concept of product differentiation.

Differentiation was hot topic debated in Pharma industry too. Differentiation is a very powerful tool-it depends on how to make use of it with product development (coupled with right technology) thereby effecting a paradigm shift the way internet has moved from ground into the cloud. It’s a question of time before we move into the universe and harness the power of technology. On one hand we saw a brick and motor view on differentiation becoming disruptive and we also saw a consultant’s view from SAP on the same topic through ERP system.

ONGC too presented a very powerful case study in their supply chain journey using e-auction as a mechanism. We as L&T have participated earlier, we have also rejected it and finally a best practice has evolved which has been extensively used. ONGC also presented how they used technology for vendors selection and development. It is very crucial to derisk your business by having more suppliers and cut across geographies as political volatility & trade unionism that can put entire industry at risk.

In a book titled “13 Killer Differentiators,” Quality and HSE are no longer considered as differentiators. However, maintenance of these non-differentiators is a point that comes out strongly from a compliance standpoint from Cipla and Mahindra. Sustainability also is an intrinsic part of production program that also came out strongly from discussion.

Unilevers touched a raw nerve that is often repeated in many forums as to why conversions of CPO to CEO is very rare. The entire SCM community grapples with this and could be subject IIMM could take up separately. Of course, we heard of the gravity defying 4G technology presented by Unilevers in their SCM process.

We had an excellent leadership presentation from Mahindra HR team who took it forward as to how the leadership adds value. One important point emphasized therein is the need to have functional competence, leadership competence and attitude to grow. Possibly this model could propel CPOs into CEOs.

Mr. Shankar shared how crazy ideas could create break through values and would like to use word Destructive Innovation as a precursor to Constructive Growth. Destructive innovation does not come dime a dozen while break through innovations can definitely come. Structured Innovation is the way of life today and it has to get ingrained into our DNA. This is a new concepts to be looked into.

We also had a panel discussion which highlighted the role of process engineering and talent to deliver in this testing times and underlying theme was risk management. As a senior hydrocarbon executive, we know the impact of risk, whether it is for sourcing or delivering and both can have catastrophic impacts all through. It is not incremental, it is catastrophic.

The entire Executive Committee put their collective strengths together to make this event a wonderful even. Au Revoir for this year and we will be back with a new edition of DISHA next year.

by Mr. Satish Palekar, VP, L&T Hydrocarbon and Vice Chairman, Mumbai branch