“We have decided to lead the change”

Dr Anand Agarwal has been heading Sterlite Tech for last one and a half decade. Today, he is driving the change of the company from a cable and fiber manufacturer to an integrated telecom products and solutions player. He shares his perspectives on his company’s transformation leveraging digital.

What necessitated the transformation? And how is it different from changes that you have seen/driven earlier?

The thought of course came from what we are seeing in the overall marketplace; the opportunity frame that we have seen around us. We see the ecosystem around us on the verge of transformation. We are dealing with telecom companies, social media companies, cities. And we see each of them is itching to transform—to become significantly different from what they are.

Transformation is a strong word; it is not an improvement. It is a transformation of the revenue and business models of all our customers. We clearly realized that if we need to continue to be relevant in this ecosystem, for us to rapidly transform and create a lead and enable our ecosystem to transform is an obvious requirement. We have to transform and we have to drive this transformation that is taking place. You can either wait for the ecosystem to transform when you are compelled to change, or you can transform before the ecosystem and enable and drive that transformation. We chose the latter.

What it means is a shift in the offerings that we do. For example, if I sold a product, now I am selling the product as part of a solution enabling the transformation.

That is the outside piece. To do that, there is a completely inside piece also - business processes, speed of execution, automation, removing the hierarchies. With communication becoming ubiquitous, processes becoming absolutely clear, you can automate a whole lot of things so that everyone’s value addition can be of a higher level. This shift which is going to happen – of automation, a whole of processes becoming robotics-enabled, you can either wait or you can lead the change. We have decided to lead the change.

To enable external transformation, we have to—and we are doing—a lot of internal transformation is needed.

What are the measurables?

For everything, there are clear measurables. On the external side, the measurable is how I am able to do more for my customers at the same level of cost.

For instance, I am providing my customer 100 capacity at 100 cost. Can I provide them 100 capacity at 120 cost? For me, it is a revenue increase of 20%; for them, it is doubling their capacity at 20% extra cost. If I have a manufacturing plant where 300 different designs are being churned out, how do I optimize those designs to 40-50? Same with tome for RFQs – how can I bring them down significantly? All these programs have clear measurables.

One of the key components of the transformation journey seems to be data. Your take?

For most of the companies, data is a byproduct. We are moving data. Our customers are in the business of carrying data, storing it and processing it. For us, hence, the question is a little different. How do we handle that data—do we keep it close to the end customer? How fast can it move between one center to another? What kind of compression technologies you must apply?

We are not thinking of creating a new revenue model from the data; we are focusing on making these processes—transporting data, storing data, processing data—better. 

As someone who has been in manufacturing industry for long, how do you see the phenomenon called industry 4.0?

The best thing about all these is that it has created a sense of urgency in everyone. Now, people are compelled to know about it. For me, that is the big shift. But the danger is people get fascinated by a tool and say I must use it. I must do industry 4.0, I must do blockchain…

For us, it is a natural progression. For example, the new factories that we are making now have much more sensing; much more robotics-enabled material movement; they have much better communication channels. It is leading to better decision making.

But it is all powered by our 25 years of experience as well.

The tools and the expertise need to marry. If you use the tool for sake of a tool, I do not think it is a great thing.

But we have seen companies coming from nowhere and shaking markets, just because the existing leaders did not change fast enough….

Yes, you need to do both. If you do not change, you will die. You must be willing to change, must know about all the tools available out there but must have the expertise to use them most appropriately to create business value for yourself and your customers.

As I said, it should be a marriage. And it is that marriage you need to manage.

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