By Suveen Sinha
I have heard about Mr. Jagdish Khattar as a great man who can be brutal in making decisions and he takes the right one. He was in Uttar Pradesh (a state in India) as an IAS (Indian Administrative Service) officer and revolutionised the transport industry with his ideas, though the mob there was very arrogant and not ready for any change.
Before reading this book, I strongly recommend you to read, "THE MARUTI STORY" by Mr. RC Bhargava. (else wait for my post)
Let me put some best points in his book which I liked about the book,
(this is only a part of the book I have summarized, few more points I will update as I learn)
1. Government Politics and Suzuki's technology
Right from appointing a MD , appointing a labourer, dealer, vendor for Maruti Suzuki, ministers from government wanted a pie. Most of the issues will be on Prime Minister's table for taking decision. Hence all decisions like technology transfer or training has to wait for a long time.
2. Maruti 800 sold at Rs. 45000 (at a loss)
No body agrees to sell a product at loss. That is a fundamental business line. Actually Maruti was selling a car at Rs. 45000 and that price would have created a loss. But customers were willing to pay for a car that is to be manufactured 2 years later. So they could get investment from customers 140 crores and remaining 60 crores were invested. "So there is least investment cost". Govenment helped very much for the investment. That is the sole reason even today why Maruti's have cost advantage though they pay to vendors much more than other OEMs (Original Equipment Manufacturer)
3. Pioneer in Production
It was during his tenure, Maruti production plant was bench marked with other Suzuki's Plant in Japan and they achieved it by continuous improvement, educating workers and managers. And today yes the plant are world class and highly cost efficient.
4. The Maruti Strike
The labour union was always favored and their union strikes became often and for all reasons. They were going very powerful that they could not be managed. Khattar took a firm hand. He gave a warning to all employees to stop striking and start working. When they refused he brought in young kids from village who had completed basic ITI training. Made them work in plant supervised by managers. All people who were striking were removed from company. This was the first time the voice from the union was taken out. Here too Prime Minister took the decision to solve the issue.
5. Carnation
Maruti today has more than 1500 service outlets in India and still expanding. But other companies like Toyota, Fiat, Ford etc do not have such network which is ruining their sales even today. So Khattar once his tenure as MD at Maruti ended, he started Carnation a multipurpose service centre. Yes he is an entrepreneur now and yes he earns in crores.
I have heard about Mr. Jagdish Khattar as a great man who can be brutal in making decisions and he takes the right one. He was in Uttar Pradesh (a state in India) as an IAS (Indian Administrative Service) officer and revolutionised the transport industry with his ideas, though the mob there was very arrogant and not ready for any change.
Before reading this book, I strongly recommend you to read, "THE MARUTI STORY" by Mr. RC Bhargava. (else wait for my post)
Let me put some best points in his book which I liked about the book,
(this is only a part of the book I have summarized, few more points I will update as I learn)
1. Government Politics and Suzuki's technology
Right from appointing a MD , appointing a labourer, dealer, vendor for Maruti Suzuki, ministers from government wanted a pie. Most of the issues will be on Prime Minister's table for taking decision. Hence all decisions like technology transfer or training has to wait for a long time.
2. Maruti 800 sold at Rs. 45000 (at a loss)
No body agrees to sell a product at loss. That is a fundamental business line. Actually Maruti was selling a car at Rs. 45000 and that price would have created a loss. But customers were willing to pay for a car that is to be manufactured 2 years later. So they could get investment from customers 140 crores and remaining 60 crores were invested. "So there is least investment cost". Govenment helped very much for the investment. That is the sole reason even today why Maruti's have cost advantage though they pay to vendors much more than other OEMs (Original Equipment Manufacturer)
3. Pioneer in Production
It was during his tenure, Maruti production plant was bench marked with other Suzuki's Plant in Japan and they achieved it by continuous improvement, educating workers and managers. And today yes the plant are world class and highly cost efficient.
4. The Maruti Strike
The labour union was always favored and their union strikes became often and for all reasons. They were going very powerful that they could not be managed. Khattar took a firm hand. He gave a warning to all employees to stop striking and start working. When they refused he brought in young kids from village who had completed basic ITI training. Made them work in plant supervised by managers. All people who were striking were removed from company. This was the first time the voice from the union was taken out. Here too Prime Minister took the decision to solve the issue.
5. Carnation
Maruti today has more than 1500 service outlets in India and still expanding. But other companies like Toyota, Fiat, Ford etc do not have such network which is ruining their sales even today. So Khattar once his tenure as MD at Maruti ended, he started Carnation a multipurpose service centre. Yes he is an entrepreneur now and yes he earns in crores.
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