Dharmesh Arora, president and CEO, Schaeffler India, is driving change within the company | by Indira Rao |
Twenty five years is a long time to get into a mould. However, to break off from the mould while keeping the lessons learned intact is not everyone’s cup of tea. It is, however, true for Dharmesh Arora who has been in the automotive sector forever. He started his career with Maruti Suzuki and then held several management positions at General Motors in India, Mexico, Thailand and USA. Today, he heads the Indian office of Schaeffler that apart from automotive also serves the huge industrial sector. “Automotive has been my background since I started off and when the opportunity came by at Schaeffler I was quite impressed with what they do in terms of their focus on products and technology. I came on board in mid-2012 and since then it has been an extremely learning experience as far as the industrial sector is concerned,” states Arora.
Heading the Indian office of one of the largest German and European industrial companies who are the leading manufacturers of bearings worldwide and a renowned supplier to the automotive industry, is an extremely challenging role. What helps here is the fact that Arora has always been the customer and though he is the manufacturer now he knows exactly what his customer wants. Seconding, he echoes, “What I have brought to the table is that thought process of what the customer requires. Customer centricity has been one of the major cultural changes that I am trying to bring about in the organisation. In the last two-and-a-half years we have brought out two initiatives —‘Vision 2020’ and focus on One Schaeffler India.”
Within this bracket the company primarily focuses on customer centricity, growth, technical competence, operational performance improvement and people initiatives. Schaeffler operates
under its three strong brands viz. LuK, INA and FAG or the automotive and industrial applications. However, the industry has always seen the three brands as independent companies rather than associated with Schaeffler. “That is correct,” avows Arora. “After I stepped on board, one of my focus areas was to reorganise ourselves under the industrial and automotive business divisions. Hence, when my people go to customers now, they pitch for solutions from all the brands. This has also helped the customer in turn as they have one key account manager to interact with and not multiple people for different issues.”
The Indian branch has been on a roll since the last two years. It set up a green field facility at Savali near Vadodara and since then has been ramping up production there. The plant manufactures Schaeffler’s most advanced lowfriction deep groove ball bearings and large-sized
bearings for diverse sectors such as wind energy, heavy industries and railways. They also opened another plant at Hosur that produces state-of-theart hydraulic clutch release systems that offer benefits of lower noise, vibration, and harshness (NVH) levels and improved drivability while improving fuel economy. Now the plant also produces an advanced level of dual clutch systems for cars and tractors. The INA plant facility in Pune continues to receive new investments almost every couple of months and they also recently installed a new product line there.
“Thus, we are continuing to expand the facilities here. The Vision 2020 document clearly states our growth plan of becoming a Billion Euro company by 2020 from the current 300 Million Euros. That is a pretty steep growth and we have plans and initiatives lined up to achieve it,” asserts Arora. Innovation and creativity are at the core of Schaeffler’s growth strategy and the company is among the innovation leaders in the industry with around 2100 patents being registered just the last year in Germany. “In India we have taken a large initiative this year to file at least 60 patents. Last year, we did eight and this year we are really pushing hard to gain that momentum that will help meet that goal,” says he. Of course patents go hand in hand with R&D and Arora lays large emphases on the same.
“We have R&D centres basically at each one of the three locations. Currently we have about 120 engineers working in the R&D department and we want to double that in the next four years. This requires a focused approach in terms of training. Hence, we send people over to Germany for extended periods of time and have them work on actual projects in Germany so that they can bring back the knowledge of project management and development back to India,” explains Arora. They are also in the process of developing a central R&D centre in Pune that will take care of advanced development activities.
A company can get innovative only when the employees are encouraged to think and explore possibilities. What also acts as a stimulant for the employees is when the top management takes the time to come onto the shopfloor and interacts with them. And this sort of a hands- on- approach is what I saw while interacting with Arora.
He personally works with the people on the shopfloor and gives them ideas on what the end product should look like. “Sharing the knowledge and experience is extremely important, I think. I constantly try to ensure that my team understands the customer’s requirement completely and lives up to his expectations. That happens when I have face-to-face interactions with them so that they are clear with respect to the expectations of the leadership and this sets the tone for the whole organization to follow,” asserts Arora.
Taking pride in this openness and being accessible to one and all, he avers, “We, at Schaeffler India, are building an organization based on ‘trust, teamwork and transparency’, and I think this openness brings about the transparency in an organisation which ultimately results in building trust that enhances team work. I enjoy interacting with people, going down to the shop floor, talking to operators on the machines, on the supply chain, people driving the fork truck and everybody else.”
What adds impetus to his interactions is the fact that he knows the pulse of the customer. Like I said before, having been a customer himself it now helps Arora get into the psyche of his customers. There was this one incident at his factory where his team couldn’t deliver the product on time to the customer and wanted to ask him for an extension. Now that is something he was not quite comfortable with because he put himself in the customer’s shoes. “I intervened personally and made some process enhancements that required the entire value chain to function smoothly. Now we are on track. I want to build the culture in this company to never skip a schedule of the customer. I want to ensure that my entire value chain works like a well oiled machinery.”
When it comes to business, the automotive constitutes about 45% and the industrial sector forms the other 55%. For Arora handling the industrial sector is a different ball game all together. “With automotive we follow a sector approach but with industrial there are sectors and sub sectors. For example, within mining there would be coal, oil & gas, etc. The industrial sector is a huge portfolio and getting a grasp on it is very challenging. What makes my life easier is, knowing that I have extremely good talent in my organisation.”
Schaeffler has a really strong hold in the aerospace industry and supplies to all the majors including the likes of Boeing and Airbus. And the entire engineering and supply of the products happens from India. “We work globally under the brand name of Barden. Headquartered in the US, the brand is our precision bearing solutions primarily for the aerospace division. We participate by developing products for them using our engineering at our factory in Baroda,” avers Arora. Urban mobility such as metro rails, railways, new energy and the power sector also form a major part of the company’s business portfolio.
Following a two-legged approach the company transitions smoothly across the automotive and industrial sectors. “If you look at the automotive sector, the pressures of fuel efficiency, emission reduction, automation of transmissions, modernizing the plant will continue to happen and we have the kind of solutions that would be required for each one of these challenges. Take our concept car for example, affirms Arora.
Another innovative product that comes out of the company’s kitty are the shift towers that were engineered specifically for an Indian OEM. “Shift towers are basically a mechanism that transfers the movement of changing the gears manually in a car into transmission. We worked very closely with our counterparts in Germany to develop this but when it comes to really using the solution and putting that frugality in it, it was our own value engineering solutions. And we are further refining that to reduce the cost as well as the complexity in it.”
This kind of a solution is currently not in every car and many are still dependent on solutions from previous generation. “Therefore, we think there is a big market for this and our aim is to bring, this solution that caters to the Indian needs, at a price level that is affordable to the Indian manufacturers.”
Innovation is seen in the industrial sector too where for the steel sector, the company is in the process of replacing the brass cage, which is used in the large bearings, with the steel one. The steel cage provides for better efficiency and cost optimisation. The Maneja plant produces spherical roller bearings and cylindrical roller bearings that were specifically developed for the Indian market and now are exported aboard to China, Europe and the US.
What also sets the company apart other than its innovative products is the manufacturing process. The company follows some critical manufacturing technologies that makes them competitive. Decision stamping is one of them. “In many cases our competitors produce parts out of forging and machine route whereas we are able to produce the same out of a stamping route, a process that is much more efficient and cost effective. Honing is another area where we are able to produce precision components at a lower cost. We have our own special machine building division that does the core machine building for us,” states Arora.
Following operational excellence mantras of ‘Fit-for-Quality’ (focusing on engaging everyone to produce high quality produce at the least cost) and ‘MOVE’ (German acronym for ‘More without Waste’) lean manufacturing, the company makes itself highly efficient.
Schaeffler India under Arora’s leadership continues to make investments even in today’s economic climate. Agreeing he adds, “This year alone we will be making capital investments of more than `150 crore in the country. And in the long-term, we stick to our vision of 2020, which requires us to make investments in manufacturing, product engineering and R&D,” stresses Arora on a concluding note.