Sudhir Trehan is credited with catapulting the Gautam Thapar-promoted Avantha Group firm Crompton Greaves from a Rs 1,250-crore, loss-making firm to a successful Rs 10,000-crore global entity in a decade. But ask this CEO on the eve of retirement on his main influences and pat comes his answer: “I have always considered myself to be an engineer first.” This gold medallist in mechanical engineering from BIT, Mesra, now moves on to the Avantha management board as the chairman of Avantha Power and Infrastructure Co. He will also be chairman of the board of governors of Thapar University. “It will give me more chance to interact with the students and faculty,” he says. Excerpts from an interview with Arti Sharma:
How would you respond to the recent debate about the quality of research in the IITs?
The quality of education at the undergraduate level in IITs and IIMs is world-class. So any BTech coming from IIT or a PGDM coming from IIM is at par with those coming out from the Ivy League, be it Harvard, Stanford or MIT. But if you have to compare the IITs globally, even European schools like INSEAD or LSE fare better researchwise. It is definitely lacking in our country compared to what you get in an Ivy League in the US. This is because not enough thrust has been given to research in our country. Why will an institute spend money on research if it is not going to get returns from it? Today, the reputation of the IITs is good because the BTechs coming out of it are employed by the best of companies across the world. You have to build upon that reputation. Harvard, Stanford and mit are not known for their graduate programs. They are known for their masters and PhDs. People don’t go there to do graduate studies. Likewise, people do not come to IIT to do PhDs. So the whole infrastructure and environment for promoting research is lacking today in the country.
“Earlier, we paid higher salaries to MBAs. Today our MTechs are paid the same salary; PHDs, even higher.”
Corporates also need to drive that movement. Barring the last decade, corporates have always been used to technology transfer rather than working to develop technology. Now that the market is open, corporates, knowing that they can capture the market, will not accept technology transfers. Hence it is imperative that India now develops the infrastructure for research. To create an ecosystem for research, where universities have a definite role, they need to recruit much more faculty and push them to not only teach BTechs, but also conduct research. Industry needs to give projects to IITs and IIMs for doing research. Funding has to come from the industry. There is no point blaming the IITs. We know they have excellent faculty because they are producing excellent BTechs. They are not working towards research because the country’s ecosystem is not suited for research even today.
But things are changing. I strongly differ with the view that the quality of faculty is not up to the mark. The same faculty can go to Harvard tomorrow and will be employed as professors. They will be able to conduct research because the ecosystems exist over there for it.
But doesn’t the policy framework suggest a narrow-minded view towards the development of education?
It is definitely a narrow view. In my view, opening the market in anything only helps. The IITs’ viewpoint towards research will change if they knew Harvard and Stanford and mit are coming here. They will realise that the reputation of their colleges will suffer if they don’t change. And hence they will become catalysts in creating an ecosystem for research. Why didn’t manufacturing become more productive and quality-conscious 30 years ago? It is because it was not open; there was no push. As manufacturers, we were surviving, selling the products we wanted at the prices we wanted. That has already changed.
Do you think engineers are moving from their core roles to MBAs and IT?
“When i came out of engineering college, I felt i was master of the world. Those who change taste success.”
That’s true. The reason is very simple. There is a higher reward for managerial roles and for financial functions. So IITians and the best of engineers from other institutes are using their degree as a base to do their MBAs from IIMs and get into finance, investment banking and other fields rather than core manufacturing. The thrust has to change to get back to research in the industry. Only then will engineers start coming back to doing research in the industry and they have to be rewarded at par with other functions. That thrust has already started. We used to pay much higher salaries to MBAs and much lower to MTechs. Today, we have made the salary of our MTechs equal to MBAs because we need those MTechs; and our PhDs are paid much higher still.
Now people are accepting that by doing MTech after BTech, they get the same benefits as after doing an MBA. This is a trend that is setting in. We were one of the first to do it. Now, there are a number of engineering companies where management and MTech trainees are at par. We don’t need these engineers to do shopfloor supervision. That is a mundane job. That can be done by lower-skilled people. So, the job profile has to be changed. It has to be more knowledge- and domain-based, and with that, quality of life also improves. Quality of life is poor once you are based in a manufacturing shop in a plant.
What about the quality of education in diploma courses?
This area needs a lot of improvement. The qualification is below average today in the country. And it goes beyond the additional funding announced in the last budget. There is need for creating a proper infrastructure for diploma-holders also.
How has your style of management evolved, from being a trainee engineer to a top management role?
When you come out of engineering college, you look at the world differently, your management style is dictated by your ambitions and your role models—the ones you pick up in school and in college. As you move up the ladder in the corporate world, your role changes and your interaction with people changes. Initially, you start contributing due to your knowledge and effort. More and more, as you move up in an organisation, your role becomes that of motivating others and getting work done from them rather than from your own knowledge and contribution.
When I passed out at 21, I felt the same: I am the master of the world. And so will be the 21-year-old coming out of engineering college today. Those who will be able to change will taste success. They will start on the same platform—five years down the line, some will realise that three people report to them, so their output is supposed to be of four people, theirs plus three more. If he remains in the same style at 26, he may give his 100 per cent. But whether or not he can get 100 per cent from the other three, he will still be judged on 100 per cent of four. Some make it to the next level, not that those who make it definitely have better knowledge, but they would definitely have better skills and behavioural patterns of management, which can’t be taught at business schools.
What is your opinion on the state of manufacturing in India today?
Today, most of Indian manufacturing is at par with the global standards of productivity and almost at par in quality. But China still beats us, particularly in mass-produced manufacturing. If 10 made-to-order pieces have to be produced, designed and engineered, we are good. But if a million pieces of one kind have to be produced, then China has an edge. One of the major, continuing drawbacks in manufacturing today is the cascading impact of our taxation. We are at a nearly 16 per cent cost disadvantage when compared to China. The second drawback is the infrastructure. We take 15 days to push our transformer from the factory to the port. China does it in one day. Their port turnaround time is in hours. Our port turnaround time is in days.