I HAVE BEEN covering Ashok Leyland or 54 years. In the 1960s I interviewed A E L Collins, the then Managing Director of the auto major. In those years, British Leyland held majority of Leyland’s shares. The Society of Motor Manufacturers and Traders Ltd, on a kind reference from a senior executive of British Leyland provided rich opportunities to look closely at the British auto industry. SMMT said I was then the first non-European journalist to be extended such a facility! This visit, along with one to Germany, helped me gain deep insights into the global auto sector.
A niche player in heavy vehicles...
AL earned a great reputation for the quality of its heavy vehicles. It earned a niche in the passenger segment. Along with the Tatas, they pushed out the Dodge and Fargo models of Premier Automobiles and the Bedford trucks of Hindustan Motors. AL strengthened its position focusing on indigenisation.
Seshasayee, after qualifying as a chartered accountant, joined Hindustan Lever and then shifted to Leyland in 1976. AL witnessed a sea change when George Fernandes decreed the dilution of foreign shares in Indian companies to 40 per cent. R J Shahaney, who earlier turned around the public sector Jessop & Company, took charge as the Managing Director. For a while, S V S Raghavan, a finance wizard who excelled in technology and management, worked for AL. The formidable team of RJS, RS and SVS embarked on a massive expansion setting up units in Bhandara in Maharashtra and in Alwar in Rajasthan; a large plant took shape at Hosur, liberating the company from the constraints of expansion at Ennore. Hosur evolved as a strong centre for engineering. AL developed markets for exports in several Asian and African countries. RJS expanded and encouraged his young team of managers Expanding orders from State transport undertakings and thrust on exports contributed to the steady growth of AL.
The acquisition of the British shareholding by the Hindujas in the mid-1980s was a landmark. The collaboration with IVECO of Italy contributed to the upgradation of technology.
Multi-dimensional expansion of AL
All through, the financial acumen of RS, who built a strong team of young finance managers, ensured effective cost management and profit maximisation. RS’s yen for systems and interest in technology were positive factors. When RS took charge from Shahaney, he gave fuller play to engineering and technology development.
In the late 1990s, I pointed out the poor commitment of auto manufacturers including AL and Bajaj Auto, to R&D. A critical report on AL’s stagnant technology was not flattering. The company that ordered 85,000 reprints of my special feature on AL once stopped its advertisements and subscriptions! However, I was happy over AL’s subsequent focus on R&D. In a very short time, the company built a strong team of scientists and engineers, liberally recruiting from the US, Europe and elsewhere. A large contingent of over 2000 work today on R&D. The company introduced in quick succession new designs and models expanding the range of vehicles for on the road and off the road applications. It also forged new collaborations and set up three joint ventures with Nissan Motor Company. AL further strengthened its leadership by inducting V Sumantran into the board. AL acquired technology companies in Europe and expanded in volume. RS’s expertise was used by the Hindujas in the group’s larger range of activities. RS assumed charge as the chairman of IndusInd Bank. He also provided his expertise to the Hinduja Power Corporation and host of other activities of the group.
AL’s production during four decades of RS’s association grew from a few thousand commercial vehicles to nearly a lakh!
Articulate business leader...
In a recent chat, RS referred to the carnatic musician Aruna Sairam interviewing him for a music channel: “during the conversation two things struck me. The first, should I have too many interests? Should I have focused on a single interest where I should have excelled?” he ruminated. I was inclined to support the first part. RS has varied interests. Happily he excels in all these!
RS described the evolution of his career in distinct parts: having worked with a multinational, moving on to a family-controlled organisation, later to head a professionally-managed company and now focusing on technology and skill development. Creating new businesses in these, he has had the opportunity to look at governance issues.
RS referred to his experience in working with the renowned scientist Dr S Varadarajan who was heading research at Hindustan Lever in the early 1970s. This experience helped him understand the essence of research and development and explain RS’s extensive foray into R&D at AL. This transformed the course of AL in the new millennium and helped it introduce new technologies and model systems in a continuous stream.
RS is among the few business leaders who have been actively contributing to policies and reforms at the national level. For two decades, his counsel has been made available to the government through the Society of the Indian Automobile Manufacturers and CII. I remember his brilliant address along with Jyotiraditya Scindia at the CII national conference.