Rajiv Bajaj outlines priorities after leadership recast

It was sometime last year when the Bajaj Auto board had decided to elevate Rakesh Sharma as part of a promotion plan. He was then head of international business and had clearly done an outstanding job in spearheading the company’s presence in a host of overseas markets.

Yet, Rajiv Bajaj, Managing Director of Bajaj Auto, had other plans. “I chose not to put him in the hot seat immediately. Those were challenging times with the domestic motorcycle business not doing great numbers while exports were facing pretty strong headwinds,” he recalls.

Additionally, there were other issues to reckon with in the form of high oil and commodity prices. Clearly, these were not the easiest of times for the company. “Had I stepped back then and given the reins to Rakesh, it might have sent the wrong signal. During difficult periods, it makes sense (as captain) to handle the ship yourself,” continues Bajaj.

From his point of view, he was better equipped to tackle the situation since he was familiar with other aspects of the company’s business. On the contrary, it would have been difficult for Sharma to take over and adjust quickly during this trying period. It also explains why his promotion/elevation was held back for a year.

Better times

Today, the tide has turned and Bajaj Auto has been doing exceptionally well in exports while staging a strong turnaround in its domestic bike business. Three-wheeler sales have also reached new highs, both here and overseas. Additionally oil prices are more stable now while there is far less volatility in export markets. “I believe Rakesh is better equipped to handle the challenges now and I am sure he will take the company to greater heights,” says a confident Bajaj.

This also puts in context Sharma’s recent elevation as Chief Commercial Officer (CCO). While announcing this new position, Bajaj had indicated in a communique to employees that this was being done to strengthen the alignment between a “sharp and nimble front end and a deep and modular back end”.

As CCO, Sharma will now complement the efforts of Executive Director, Pradeep Shrivastava, and Chief Technology Officer, Abraham Joseph (Joe). The idea is to bring together all business units in the pursuit of better product harmonisation, marketing synergies, customer focus and corporate alignment. All the heads of the various verticals will report to the CCO.

“From my point of view, this (recast in responsibilities and reporting functions) was done keeping in mind that the person at the helm should be the best — in fact, better than me in the specific role assigned,” says Bajaj.

As he puts it, Sharma has a “fantastic track record in our global business”, which now accounts for a substantial chunk of overall output. Exports are tipped to touch two million units this fiscal with markets like Africa and Latin America now back on track and ASEAN now being the new focus area of growth.

“With Rakesh now as CCO, there will be sharper focus at the front end where the verticals will be nicely balanced and integrated. Pradeep (Shrivastava), likewise, will handle the back-end in terms of processes and manufacturing across the plants,” says the MD.

It is also his view that the new management recast will go a long way in attracting young and dynamic talent to the organisation. “Ambitious graduates will be hopeful of leadership positions in the future when they see that there are the likes of Joe, Pradeep and Rakesh in top positions. It’s not as if you need to be a Bajaj to be able to call the shots,” stresses Rajiv Bajaj.

New role

So what will his new role then be, you wonder. After all, he has been the face of the company for many years now. Going by his communique, Bajaj has clearly stated that the recent reorganisation of roles will enable him to take a couple of steps back in order that “I may address some other matters that will merit my attention into the future”.

You ask Bajaj what he is implying through this statement and he puts it in perspective. From his point of view, there are no two ways about the fact that Bajaj Auto is a focussed company, which specialises in the manufacture of motorcycles and three-wheelers.

“Despite being reasonably focussed, there are a host of areas that need to be taken care of right from the domestic and export business to KTM and Husqvarna as well as Urbanite and Triumph (in the near future),” elaborates Bajaj.

Given these new challenges, he believes it is imperative for him to focus on some of them especially Husqvarna, Urbanite and Triumph. To elaborate, Husqvarna is the Swedish motorcycle brand that KTM acquired from BMW five years ago. By 2019, it will be part of Bajaj Auto’s Chakan production line, which is already manufacturing KTM motorcycles that are sold both here and overseas.

Urbanite is the new vertical created for electric mobility where the focus will be on two- and three-wheelers. If things go according to plan, the first offering (be it a scooter or motorcycle) will be out on the roads before 2020.

Finally, Triumph marks a new alliance to make mid-size motorcycles again from the Chakan plant. The British brand tied up with Bajaj Auto recently to market this category of bikes both in India and emerging markets. Given these huge responsibilities, Bajaj says there is just no way he can continue micro-managing each and every other vertical as was the case till recently. “This is where Rakesh will take over a big role and I am confident he will do very well,” he says.

Focus on emerging businesses

Bajaj believes that, in his turn, he will have his hands full with the emerging businesses, which involve a lot of attention. Triumph and Bajaj Auto will have their first models out by 2020. Similarly, electric mobility is a new challenge where Urbanite, under its new Head, will also need some hand-holding.

While each of these brands (KTM, Triumph, Husqvarna, Urbanite) represent multiple verticals and a set of different complexities, the overriding goal will be harmonisation of all brands, which includes those from Bajaj Auto like Pulsar, Avenger, Dominar 400 etc.

“By the end of the day, each of these bike brands should be able to meet the challenges ahead both in the domestic and export markets. This is what harmonisation represents, which means there is really no need to reinvent the wheel,” reiterates Bajaj.

Additionally, the other big challenge ahead for the Indian automotive industry is the implementation of Bharat Stage VI emission from April 2020. Not only has the country skipped BS V in the process, but the tighter timeframe between BS IV and VI will mean that companies have their work cut out in ensuring that costs are kept in check.

This is not going to be easy considering that there will be substantial investments in new technology and not all of it can be absorbed by manufacturers. Yet, passing the entire burden to customers may not be the easiest of options especially in a price-sensitive market like India. With 2020 marking new initiatives from Triumph as well as Husqvarna and Urbanite, Rajiv Bajaj may just end up being busier than usual.

COMMENT NOW