The Maruti Story

by R.C. Bhargava

Maruti is one of the few (perhaps only) shining example of a public sector companies in India to have achieved global competitiveness and made it big, giving the leading private companies a run for their money, and its story has to make for very interesting reading. What was the vision behind starting a car company in India? Why did they chose Suzuki as a partner? How did they navigate the red tape that ails most of Indian industry? How did they build a leader in quality, changed the rules of the game to make auto manufacturing customer centric?

Who better to tell this story than R.C. Bhargava, the man who built Maruti during its formative years and is still associated with it as its Chairman. In a very intruiguing account spread over two-and-a-half decades, Bhargava describes how Maruti was conceived, nursed, nurtured, grown and built into a giant of our industry.

What makes the story very interesting is the light it sheds on the changing face of Indian industry, since Maruti as a company owed its origin to the Emergency, nationalization, the license raj and saw through the changing economic climate of the country. The anecdotes of the author show how the company and the economy as a whole transformed, and gives us a view into times completely alien to our young existence.

I have read a number of books by the giants of the Auto industry – My Years with General Motors by Alfred Sloan, Lee Iacocca’s auto-biography, and I can actually identify with many of the things Bhargava describes as a result – the focus on quality, worker relations, dealer relations, focus on marketing and model development, emphasis on servicing – all of which were unknown to Indian industry at the time, and the way Bhargava describes how each of them were envisioned, and implemented, shows their foresight, strength of will and commitment.

Apart from that, Bhargava also describes some unique problems of being an Indian company – that too a PSU – where accountability and responsibility is a big issue. While we blame PSUs and the Government of demonstrating red tape and acting slow, the book also gives the lay reader an idea of why its so – most managers and civil servants will rather follow protocol and ensure that their decisions are always above board and measure up to the right standards of probity since the downside of being caught in a political storm is very high. Bhargava himself describes a number of CBI enquiries and charges of corruption being levied by him by political opponents who wanted to settle an old score. It’s only justified that in all of these cases, the individual manager would want decisions to be taken in such a manner that responsibility is shared and nobody can be “blamed” for any particular decision later. The fact that the Maruti management was able to cut through this red tape and still build a company of its stature is remarkable (of coursing, having Suzuki as a JV partner and blaming tough decisions on them is an important aspect of it).

Some key take aways for me were:

  1. Having a lofty vision and very high ideals to begin with are very important to build a sense of purpose amongst the team
  2. Having a shoulder from which to shoot from – and people who are above the circle of responsibility which enables justification of key decisions and pushing them through
  3. Communicating the right ideals of all stakeholders, and leading by example (uniforms in Maruti are still followed; I had even heard one of my classmates from IIT complain about it!)
  4. Managing bureaucracy, relationships, governments, partners can be extremely tricky and once again one has to be strong up front
  5. No compromises on quality

One grudge I have against the authors is that there are so many anecdotes that some of them are not as well covered – perhaps the editor could have given some direction on pacing the book well. Similarly, the book seems to sag in places and its easy to lose interest.

For anybody who really wants to understand the evolution of Indian industry, this is a great resource.

“IITians Impact” Survey Results

I just read the results of the survey on the impact IITians have had, and it’s fascinating how much education can change. The survey was sponsored by PAN IIT. I am traveling to PAN IIT this month, and the program seems very impressive. They have not one or two star speakers, but a full galaxy. In fact, my company Capillary is doing all the application development for their SMS based services. Some highlights:

1. Every IITian has contributed Rs. 50 against every rupee spent on him
2. IITians have a budgetary responsibility of $885b
3. 54% of the top 500 companies in India have at least one IITian on their board
4. 25% of IITians in R&D
5. 10% of IITians doing social work
6. One in 10 IITian is an entrepreneur

So much for Nehru’s vision!!!!

[See the full results of the survey here]


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