Apollo. Scion of. Fighting Corruption in the Maritime Industry. Routes to Prosperity

Transcription

1 DEC 2015-JAN 2016 VOLUME 9, ISSUE 11 `90 Scion of Apollo Building a new business is more challenging in order to discover one s entrepreneurial skills RAAJA KANWAR Vice Chairman & Managing Director, Apollo International Ltd Routes to Prosperity Fighting Corruption in the Maritime Industry

2 COVERSTORY In today s day and age it s impossible to run a successful business empire and be a staunch multi-tasker at the same time. But for Raaja Kanwar, being unconventional is in his blood. In this interview with TransREporter, Kanwar, Vice Chairman & Managing Director, Apollo International Ltd, explains how the wheels turn at his empire By Akshmin Kaur Building On 20 Transreporter DEC 2015-JAN 2016

3 the Legacy 21

4 You always had the choice of joining Apollo Tyres, your family business. What made you to start your own venture? The entrepreneurial spirit flows in my family. I have seen my father build Apollo Tyres from the scratch to a world renowned organisation. His experience, learning and achievements have always fascinated and motivated me to build something new. Yes, there is always a choice to join Apollo Tyres and take it to the next level, however building a new business is more challenging in order to discover one s entrepreneurial skills. It is Greenfield vs Brownfield, where I chose the former. In less than 5 years Apollo LogiSolutions has emerged as a prominent player in the logistics sector. What made you explore the world of logistics? During the early 2000s, the government opened up various sectors encouraged the private sector to invest in sectors like power, aviation, highways, telecom, etc. At that time, we studied and analysed all viable opportunities. It was interesting to find that logistics was (and still is) the common factor linking all the dots in any business. Furthermore, being in Apollo Tyres we have seen ground-level supply chain challenges, like bringing material efficiently at the right time and moving finished goods in the market. Apollo Tyres, like other manufacturers in India, have a separate supply chain department with over 200 employees. On the other hand in the western world manufactures/industry players are busy in their core operation, i.e. manufacturing, without bothering about supply chain. The supply chain is totally outsourced to a third-party. In India, the concept of third party logistics is still at a nascent stage. These and some other factors helped us conclude that logistics will be a game changer in years to come and there will be opportunities for a long-term sustainability plan. How is Apollo LogiSolutions different from other logistic firms? Logistics sector is very wide in scope and it is difficult for any logistics firm 22 Transreporter DEC 2015-JAN 2016 to provide an integrated solution to its clients. There are firms that specialise in certain parts of supply chain, like transportation, Non-Vessel Operating Common Carrier (NVOCC), dry ports, warehousing, etc. However, there are very few who can provide an end-to-end solution. Furthermore, in India almost 90% of the logistics firms are unorganised, with limited corporate history, low creditability, without standard processes and practices, and limited capital to scale. However, these limitations don t come into play with Apollo LogiSolutions. It is an integrated solutions provider with a strong inheritance of Apollo Group s ethics and values, professionalism, corporatisation and partnerships with global players, providing scalability and best-in-class processes. Our vantage point not only gives us a great view of and insight into what the industry needs right now, it also helps us predict the future requirements of the industry correctly. What are the obstacles faced by a logistics firms? In India, the logistics industry is highly fragmented. The severe competition within creates two big challenges for any logistics firm, viz acceptability of clients and scalability. Lack of infrastructure is another huge hurdle that we face. Opaque and constantly changing federal structure of taxes also play a major role in slowing the growth potential of this sector. How does Apollo LogiSolutions address these setbacks? Apollo LogiSolutions is backed by the strong lineage of Apollo Group. This provides us quick acceptability from any client. Further, we have a strong support from our joint venture partners, Fiege and Ferrari, who are pioneers in this domain. They help us with new technology, skills and world class practices, to remain competitive in the market. As for the other issues, we play a proactive role in representing the industry and maintaining a fruitful dialogue with the government. The aim is to find longterm solutions that help grow the economy and thereby our industry at a faster rate. What are the major concerns that India is facing on the logistical front? How can they be overcome? Poor state of infrastructure or the complete lack of it is one of the biggest challenges faced by the Indian logistics sector. This has been a major deterrent in its growth. Bad road conditions, poor connectivity, inadequate air and sea port capacities and lack of development of alternate options, like inland water transport have been constant irritants. Even though the government has woken up to this challlenge and various ministries like road, shipping, aviation and ports are working on it, they are working in silos. There is no overarching ministry taking care of the integration of all these sectors and understand the

5 OUR JOINT VENTURE PARTNERS, FIEGE AND FERRARI, WHO ARE PIONEERS IN THIS DOMAIN, HELP US WITH NEW TECHNOLOGY, SKILLS AND WORLD CLASS PRACTICES, TO REMAIN COMPETITIVE multi-modal play and cost efficiency. India still has a long way to go in terms of better practices. Apart from the above-mentioned points, other key challenges before the logistics sector are lack of human resources and low Economy of Scale due to high fragmentation of the industry. Logistics sector is vouched to be the next big thing for the Indian economy. To what extent do you agree with the statement? We have firmly believed in the growth story of the logistics sector and continue to do so. The government will have to pay considerable focus on revamping the infrastructure if it wants to realise its ambitious dreams of Make in India and 100 Smart Cities. Logistics cannot and should not be ignored if these projects have to delivered as promised. How do you see Apollo LogiSolutions changing the logistics scene in India? Most of the Indian corporate houses have different departments for various sub-sectors of supply chain like export, import, transportation, warehousing, etc. All these departments have defined KPIs and work in silos. Hence, the senior management does not have full visibility of integrated logistics and most of the time this cost is overlooked in profitability reports. Our endeavour is to make the senior management aware of this important cost element and to promote integrated approach for logistics. We work along with the senior management of our clients as their consultants or 23

6

7 partners and implement plans to improve all the verticals of logistics, such as export, import, transportation, in-plant, warehousing, etc. We are trying to change the approach from bottom-up to topdown so that change management is implemented successfully. How can India s vast demography act to its advantage for development? In India, around 31 per cent of the population is estimated to be below 15 years in age and more than half to be under 24, with the median age being around 28 by It is predicted that India will become the world s youngest country with 64 per cent of its population in the working age-group by Framing and implementing appropriate policies to create a large pool of skilled workforce is the need of the hour. Large scale investments in the infrastructure sector and sustained capital flow into the manufacturing sector will go a long way in improving the management and maintainence of labour. smallest details that I need to bring my attention to. It helps me a lot to have capable teams and CEOs managing the divisions as individual businesses. This has been our Apollo culture for decades and it comes to me naturally to build my business on the lines of my father and grandfather to keep the businesses growing. We ve invested heavily in our human resources. People working with us know and understand our investment in each one of them. We hire the best and that goes a long way in improving our overall business health. You seem to be quite a multitasker. From heading Apollo International Limited to chairing FICCI Logistics Forum, you are doing everything possible under the sun. What s your secret? My grandfather, Raunaq Singh and father Onkar Kanwar have both been active beyond the family business in these industry bodies and we have old established ties within these communities. I have chosen to continue my association that has helped me shape the future of my company. We have a very extensive expansion plan for our logistics business that we are in the midst of executing. I am ambitious and very confident that we shall be able to achieve our goals in the next few years. I learnt the importance of hard work and better time management from my father. He also taught me the importance of respecting the time of other people. My dad is a hard taskmaster. It wasn t easy to please him. I had to work harder than others in the organisation to prove my mettle. These early learnings helped me tremendously to succeed as a leader and to be better. 10 years down the line where do you see Apollo LogiSolutions Limited? 10 years down the line I envision Apollo LogiSolutions to be one of the top 3 companies in the Logistics space offering end-to-end 3PL solutions with expertise in 3-4 verticals. How do you devote time to your family in Tell us about Apollo Fiege? How does its functioning differ from Apollo LogiSolutions? Apollo Fiege is a joint venture of Apollo Group and Fiege, a major third-party logistics player in Germany. It provides 3PL services like EXIM solutions, freight management, warehousing and other value added services in India by adopting the best processes and practices from Fiege. In Germany or in other parts of the western word, the concept of outsourcing logistics services to domainexpert, professionally-managed third party firms is well established. We see early signs of this trend being adopted by Indian companies. Also, the entry of various multinational companies in India has opened up opportunities for 3PL players. Apollo LogiSolutions is a parent company of Apollo Fiege JV, focused on construction, operation and maintenance of terminals/dry ports (CFSs and ICDs). We provide integrated logistics solution to customers. From logistics business to manufacturing and exporting leather garments & accessories, Apollo International Limited has proved itself to be a pioneer. How do you balance such diverse businesses? Each business is professionally managed and our well-developed information systems and processes are very helpful tools that keep me abreast with the PEOPLE WORKING WITH US KNOW AND UNDERSTAND OUR INVESTMENT IN EACH ONE OF THEM. WE HIRE THE BEST AND THAT GOES A LONG WAY IN IMPROVING OUR OVERALL BUSINESS HEALTH with them in the same spirit. It is a very important role that we play as heads of businesses to facilitate the relationship between ourselves and others in the industry and also to work with governments on a national scale in order to bring positive changes from time to time as required by our industry. I hope to make sure that our needs are put forth in these very fast changing times. How do you deal with crisis at work? Thankfully we have yet to face crisis as I would define it. But, routine problem solving and fire fighting in operations are ongoing parts of every business. Every problem comes with a solution and one must always remain positive. I have the support of the people I lead and that gives me a lot of confidence. At such an age you have accomplished what some people can only aspire for. What do you plan to scale next in your horizon? Thank you so much. Yes, at a young age I have worked hard and gained experience the midst of such a hectic schedule? In this day and age it is crucial to maintain a strong work-life balance. I make it a point to have at least 3-4 meals in a week with my children and exclusively take out time for family. How is a regular day in your life like? My mornings begin with strong physical workout followed by coming to office. Between internal and external work meetings I spend a lot of time travelling. In the evenings I generally socialise with close friends. I prefer to be at home with my family after work. Any advice you would want to impart to young entrepreneurs out there? It is beautifully summed up in Steve Jobs Stanford University speech Stay Hungry, Stay Foolish. Young entrepreneurs should never give up their seeking spirit and take on challenges head on. Even in the face of certain setbacks they should never give up on their dreams and aspirations. 25