The Sanmar Group Annual Day 2008 was held on the 26-27 August. The evening dinner with invitation extended to spouses of employees had a festive air about it with game stalls inviting participation and prizes luring everyone. The business sessions, as is customary were insightful and informative. This year, the globalisation of The Sanmar Group was evident in the diversity of the gathering which included our overseas colleagues.
Deputy Chairman, The Sanmar Group. Vijay Sankar’s presentation provided an overview of the Group’s various businesses, status of the expansion projects - domestic and overseas, investment commitments, projections, integration of acquired businesses overseas and strategic initiatives.
He also apprised the gathering on the new initiatives in the management processes, the criticality in completion of expansion projects that called for execution excellence and decision making. The highlight of the presentation was the enumeration of the challenges in managing a large global entity in the coming years. The Sanmar Group has committed to huge capital investments globally and is expected to grow almost three-fold in the next three years with a diverse employee strength - 36 % overseas and 64% domestic employees by 2008-09.
N Sankar
M N Radhakrishnan
Prasad Menon
N Ram’s analysis of the Indian political scene took out the shine from the euphoria of ‘India Shining’. According to him a reality testing against defi ning themes in India and an objective evaluation of thought is needed. India’s position in 2020 would be complex, contradictory, paradoxical and hopelessly inadequate in the context of the present political scene. Yet, despite a gloomy political scenario, India has some silver linings. He enumerated a host of things that went right and also those that didn’t.
In the midst of an era of sustained growth, rising consumerism and the middle-class populace, N Ram
highlighted the performance of key institutions of democratic India. The Indian model of elections with an independent Election Commission and fairly high electoral participation, especially from the rural areas has done us proud. The institution of government, with a tradition of opposition politics is a valuable part of our political landscape. The performance of the news media has been fairly good - diverse, pluralistic, hysterical and even chaotic
but still performing a valuable function of a kind not seen anywhere in the world. India being the second largest in terms of circulation of newspapers (fi rst being China) and ahead of the United States, has a lot of scope for growth.
The rise of India is a consequence of the strength of the economic system. The country’s neighbourhood policy is good and we can draw hope from this. Yet another success story is the India-China bilateral trade amounting to about $ 40 billion, achieving the target well in advance. Public health and primary education has been woefully inadequate. Corporate India however, has done us proud. Notably, the excessive preoccupation with IT/ ITES sector has been corrected. While there is no clear cut prognosis, no recipe for managing the national political system, the social, economic and institutional resources are available with us. The role of the government is key and it has to do its bit.
“Value Creation in a Commodity Business” by Vellayan was a true to life case study, an innovator’s guide to beating extreme volatility and business cycles in the fertilizer business. Coramandel Fertiliser’s track record is a shining example of out of the box measures taken at every milestone. Taking the company on a growth trajectory through inorganic growth rather than pumping capital into expensive Greenfield projects, integrating and turning around of acquired businesses - domestic and overseas (GFCL and Foskor, South Africa), ensuring forward and backward linkages - these were some initiatives that kept the company robust. Notable is the management of risk subsidy by entering non-subsidised fertilizer products, indeed a blue ocean strategy. The value creator for the organisation is the entry into the rural retail sector through ‘Managramam’. With effective distribution, the company is successful in taking the product directly to the farmers, eliminating intermediaries and passing the advantage to the farmer.
Rajiv Memani’s presentation, “Economic Scenario and Business Transformation” covered two aspects –a macro economic snapshot of the Indian economy and value creation by developing the ‘soul’ of the organisation. The Indian economy is facing a pause in growth as compared to the last few years and is expected to go through this correction period for another year and a half. He highlighted that both India and China have been following an investment-led growth. But the difference is that the investment cycle in China is complemented by benefi ts in terms of economic value creation and money circulation within China. In the case of India, the challenge is that the investment cycle is being fed by critical money spend being imported out and hence the impact on the economy in
terms of opportunities and economic value generation is not happening. Many investments have been delayed across sectors and the price of oil will play a
major role in the months to follow. Growth will be muted and the lag effect of a high interest rate regime will be felt. The micro-economic perspective is not so bad but the macro economic situation is indeed challenged.
From an organisation’s point of view, he spoke about the softer factors that will be more critical in evaluation of business performance. Key to sustainable value creation for organisations is customer, employee and investor loyalty. He spoke of the 3 Vs - Verve, Vision & Value that will develop the soul of the organisation which will help it to perform better.
Kaicker presented the nuances of taking a measurable approach in ‘Building and Sustaining a Culture of Execution’. The hallmark of a great organisation is to build ‘intensely loyal customers’ and develop ‘intensely loyal employees’ who make ‘distinctive contribution.’ In building a culture of execution, he prescribes a diagnostic process before the execution plan. The execution gap is the difference between the result you want and the result you get. The driving forces for execution are people, fi nance, technology, etc., - all of which are assessed, measured. Rajan focuses on measuring and diagnostics of the restraining forces of execution- lack of teamwork, synergy, commitment, etc. The diagnostics is focused around six principles – focus on goals, commitment to it, knowing your role, translation into action, enabling synergy and accountability. The Execution Quotient is balancing Emotional quotient, Intelligence quotient and Spiritual quotient (related to engaging people). The four-step
formula for execution is - understanding of execution capabilities through diagnostics, consultation, roll out of program and the tools
to measure execution.
We have heard of physical infrastructure and intellectual infrastructure but emotional infrastructure? Subroto Bagchi talked about emotionally bonded organizations where the emotional infrastructure is very high and he explained how leaders could build this. The institution of family is the oldest and most lasting one which is purely based on emotional bonding. Bagchi explained the concept of emotional infrastructure by drawing parallels to and adapting 8 emotional infrastructure building factors prevalent in families that can be applied in an organisation. Leaders should consider these eight factors to build an emotionally bonded organisation. Proximity, Rich Communication, Myths and Rituals, Bonding Through Adversity, Voluntary Support Networks, A Bold Vision, Deeper Values, Extreme Exclusivity.
It was not only my first Annual Day but
also my fi rst time in
India. So everything
was really new and exciting for me. At
the evening dinner,
I was very happy to
meet so many new
and outgoing people
from The Sanmar Group. The business
session speakers and
their topics gave me
inspiration to think on
a wider frame.
Maik Hudalla,
Eisenwerk Erla,
Germany
I was grateful for the invitation and opportunity to attend the Group Annual Day. It was nice to meet so many great people. The speakers not only opened insight to a new culture for me, but I also absorbed many useful tools for business practices. I look forward to the future and growing within an organisation that truly values
their employees and community.
Nathan R
Heisler, Matrix
Metals LLC, USA
The Group Annual Day celebration was a unique experience for me. The awards function showed how much the
Group acknowledges the performance of individuals. The number of long service awards showed how people love to work with the company. The second day was a wonderful day with a lot of food for thought, especially from
Mr Subroto Bagchi and Mr Vellayan. My sincere appreciation to the organising team for the excellent arrangement.
V Venugopal,
TCI Sanmar Chemicals
LLC, Egypt
It was a real pleasure to attend the Group Annual Day. The speakers were
very informative a nd gave us
some interesting foresight on the events in the coming year. I certainly enjoyed the opportunity to discuss with the other business unit heads the new and exciting things that they are doing with their companies.
Larry Key,
Acerlan, Foundry,
Mexico
The GAD was a great forum for getting a broad based exposure to critical challenges facing businesses in India. A
wide range of topics from political to financial to people management along
with an actual case study
(Murugappa Group) was
covered in an effective manner. Also, I appreciate
the opportunity to interact with other leaders and
managers at Sanmar and got some understanding
of some of the internal challenges we face as a
group.
Krishna Kumar
Rangachari, Ph.D.,
Cabot Sanmar Limited,
India
“The GAD was a great experience, It was great to meet everyone in the Sanmar family. Based on the conversations and presentations at the GAD, I look forward to the global presence that Sanmar is pursuing and the future relationship Matrix Metals has with The Sanmar Group.”
Tim Weiss,
Matrix Metals
LLC, USA
“In the last two or three years, Chemplast embarked on major expansions at Mettur and Greenfield projects at Cuddalore and Karaikal. Ramesh, Deputy Managing Director, Chemplast Sanmar has held overall responsibility for all of them, involving a total investment of over Rs 1200 crores. The projects include expansion of caustic soda capacity and the marine terminal facility at Karaikal, the gas-based power plants there, the conversion to membrane technology of caustic soda production at Mettur, the zero liquid discharge facility, the 50 MW coal based power plant there, and of course the 225,000 tpa Greenfield PVC plant at Cuddalore. The variety and the scope of these projects threw up huge challenges which Ramesh took in his stride. In the last several months he, along with many others, has also had to face up to the tension and aggravation of the unexpected developments at Cuddalore, leading to many difficult times. He has handled all of them with aplomb, and more important, has taken his team along and provided them valuable leadership through these difficult times.
For his many contributions to the Group over a quarter century, I am delighted to recognise Ramesh as ‘Employee of the Year’.” N Sankar
“R Rangarajan, Finance (Treasury), joined the Group as Executive Director just two years ago, but in these two years, I would boldly say that he has raised more financial resources for the Group, than was raised in its entire existence earlier.
The two years that he has spent with us, the Group has had to fund its acquisition of companies in the US, Egypt and Germany, embarked on major expansions in India in the Chemical and Engineering businesses, and re-financed its Shipping funding all this, apart from the normal growth in working capital funding for the different businesses. I would estimate that Rangarajan and his team have over these two years raised about 1000 crores in rupee funding and close to a billion dollar overseas. The number of banks and financial institutions we are dealing with has multiplied dramatically, and with the higher leverage positions that we are now in, the need for continuous relationship maintenance with them has become critical.
On the international scene, we could probably not have picked a worst time to raise the USD 800 million requirement for funding the Egypt project. The sub-prime crisis, and its fall out impact on banks around the world, led to a situation about nine months ago, when it seemed almost impossible to get the financing done, but a fantastic effort by the entire team coordinated by Rangarajan has put together the entire package. This is a pretty unique achievement in project financing in the current market.
Rangarajan has handled all these difficult tasks very capably and successfully, while facing difficulties on the personal front relating to his health and the passing away of his father. I would like to thank him and recognise him as a “Sanmar Employee of the Year.” N Sankar
Employee of the Year for a second time in a row, Govindarajan is being recognised for sustaining his previous year’s performance and achieving 99% on-time-delivery and zero overdue line items throughout the year. Thanks to his efforts, the investment foundry has achieved this feat for the last 17 months. He led and mentored his team. His forethought and innovative methods to maximise production with available resources have contributed a great deal to the success of the Investment Foundry.
Sampathkumar’s process improvements have resulted in tremendous cost saving and efficient functioning of equipment. Reduction of kerosene consumption in VCM furnace and prevention of tripping of burners, modification to the alcohol heat recovery system ensuring continuous and highest on-stream hours of operation of the equipment and reduction in the water consumption in EDC washing system to 160-180 kilolitre per day which resulted in reduction of equivalent effluent discharge from monomer have brought about cost and equipment efficiencies. His next initiative of increasing VCM production from 192 tpd to 210 tpd is almost complete. He was also responsible for on-time commissioning of the EDC unloading facility and streamlining the unloading operation for smooth turnover cycle of the trucks coupled with washing improvements on the upstream side.
Ram has been wearing several hats in the previous year - as PVC Business Head, Global Sourcing Head for key feedstock and Project Lead for Chemplast’s McKinsey study. He successfully tied up VCM feedstock for the Cuddalore project, sourced ethylene for the Indian operations and planned for ethylene sourcing for the Egyptian facility as well. For these achievements and for leading the McKinsey study team, he is awarded the Employee of the Year.
Arjun deserves applause for anchoring the McKinsey study, that provided the strategic road map for Sanmar Engineering Corporation and Sanmar Metals Corporation, ensuring quality of work and keeping the team focused on the right priorities. He is also being recognised for his role in the successful acquisition of Matrix Metals and the divestments of ASCO and Vishay Sanmar. The acquisition and divestments involved complex legal and due diligence processes calling for both a macro and micro level perspective.
Swaminathan took on the responsibility to successfully commission the new membrane cell plant at Mettur. He also ensured smoothing out the bottlenecks upon commissioning and trained people to operate the facility. Alongside, he also undertook the dismantling of the old mercury cell facility without any hitch and ensured proper documentation in conformity to Tamil Nadu Pollution Control Board norms.
Ranjeet has been extremely resourceful in building up project information for the Flowserve marketing team. He maintained a high level of customer intimacy, liaisoning and coordinating effectively with consultants, contractors, project owners and OEMs. His efforts have built up the order books for Flowserve Sanmar and established strong customer relationships.
Lakshminarayanan’s contribution in mechanical maintenance and project work at Karaikal has won him the recognition as Employee of the Year. His role in the commissioning of the Marine Terminal Facility for the ethylene project, ethylene storage, ensuring the smooth functioning of the unloading arm and the commendable work in resolving issues in the refrigeration system wins him the recognition.
Victor Asir lead his team conducting monthly communication meetings, OTC process re-establishment and prioritising monthly sales plan based on customer needs, ensured significant reduction of overdue line items, exceeded delivery performance during the second half of the financial year to 90% and also exceeded sales targets.
As Head of the Customer Service function at Fisher Sanmar, Gopal worked tirelessly to meet customer timelines, supervised commissioning activities at our prime customers’ location and ensured customer confidence. His excellent product knowledge and exceptional diagnostics and trouble shooting skills have helped to provide value added service to customers.
Self-driven and confident, Karthick has exceeded his sales targets, ensured OEM customers with prompt service, contributed to development activities for new product applications and has exhibited sound product knowledge.
Performance Awardees at Vedaranyam
Performance Awardees, Corporate Office
Long Service Awardees
Standing: R Venkatraman, B Venkataramani; Seated: S Venkatesan, J K Menon, N Sankar, S B Prabhakar Rao and S Sankaran. Third from right is Vijay Sankar.
“Loyalty and good performance are like two sides of a coin. Even the best of performance management system will not be effective if the loyalty quotient is not factored in and the highest loyalty quotient will be worthless if not accompanied by performance.” S B Prabhakar Rao, who has put in 40 years with Sanmar.
N Sankar giving away the long service award to S B Prabhakar Rao.
N Kumar gives out the long service award to N Sankar.