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Home > India > Business > Special


Harsh Goenka: 25 years of being CEO

February 20, 2008

The call from Harsh Goenka's office asking if we would like to feature him in this column set off many chains of thought. Goenka, the chairman of RPG, has been something of an enigma. He heads a group that has a sizeable presence in power, transmission, technology, retail, entertainment and tyres. Yet, his presence in the media has perhaps been more in non-business publications - a lot of it for reasons like his art collection, writes Suveen K Sinha.

However, the biggest pull for this rendezvous was none of these. I felt compelled to meet him to ask the one question that many of my ilk, who have had slow starts to their careers, ponder from time to time: what is it to start as the CEO?

Goenka did almost that. He became the managing director of tyre maker Ceat, a company that his father (R P Goenka, the takeover artist of the 1980s) bought for Harsh to run. The present moment was a good time to pop the question, since he first became MD 25 years ago. The silver jubilee is a milestone, and a good time to look back and forward.

As I wade deep into the belly of China House at Mumbai's Grand Hyatt, I expect to meet a battle-hardened, tough-as-nails executive who perhaps needs art as a welcome distraction. What I find, however, is an immensely soft-spoken man with impeccable manners who, to my disbelieving senses, appears enthusiastic about what he has been doing for a quarter of a century.

But first to the fore is the art inclination. When the petite waitress, who can pass off as an east Asian, comes to take our order, Goenka confirms that the d�cor of the place is indeed done by Super Potato, a design firm, before ordering vegetarian noodles and some leafy Chinese vegetables. Even this is indulgence, according to Goenka, who is conscious of his weight. Normally, his lunch consists of just soup and salad.

I knew he was a vegetarian and was hoping that he wouldn't mind sharing the table with an obsessive meat eater. To my relief, when Goenka comes to know of my inclination, he insists that I have non-vegetarian food. I quickly proceed to order a plate full of chicken nuggets, recommended by the waitress, to go with the noodles, which Goenka is sure would be enough for both of us.

Orders out of the way, I request him to begin at the beginning. Surprisingly, he begins with a tinge of regret. "I wish I had had more grounding. All I had was two years of training in a textile company of the group (owned by uncle Jagdish Prasad)."

Within days of taking over as the managing director of Ceat, Goenka visited Tokyo for a meeting with the top brass of Yokohama Rubber Company. To his slight discomfiture, the Yokohama chief kept looking at him in a peculiar way. Finally, the Japanese let it out: "You look so young, it's hard to believe you are an MD." (On the way back, the young MD took the decision he has stuck with for the last 25 years: to grow a beard to look mature enough for the MD's post.)

Back home, though, there were no curious glances. His family name carried enough weight. "In my time, there was much more respect for lineage. People listened." There is another person in the group with the same lineage, his brother Sanjiv, who is based in Kolkata and whom Goenka refers to as Sanju. Together, the brothers have steered the group through the modern era of Indian business - into emerging areas like retail and, for a brief period, telecom.

Goenka has no regrets about exiting mobile telephony, a booming area that has helped companies like Bharti Airtel [Get Quote] reap a rich harvest of profits. The scale of RPG's telecom business, which included all of two cellular licences, Madhya Pradesh and Chennai, was too small. "We have invested the money earned from the sale and grown.

So no regrets. As the Gita says, you have to do the right things at the right time." There is a minor course correction on in retail, in which RPG was one of the early entrants. "The scale-up was slow in the first two-three years, which was the period of learning. We have grown much faster in the last one year."

Interestingly, there is no formal demarcation of responsibilities with Sanju. "The businesses are run by chief executives. We support them." But does it rankle when the younger brother hogs the limelight, such as during his stint as the president of the CII? No, it doesn't, says the elder. "I enjoy doing my work. I did a stint as the head of Indian Merchants Chamber (a Mumbai-based association), but did not enjoy it."

In this lunch full of little surprises, Goenka unleashes one more while talking of work. Usually, managing directors and chief executives like to talk of their achievements and ambition in marketing, sales, acquisitions, and so on. Goenka says he spends half his time on human resources.

He sounds passionate about Pragati, a group initiative under which eight management institutes have been set up to train "our people". The training is spawning many curious stories of human transformation, since it includes programmes to train even someone who has studied only up to Class X and is earning his livelihood as a rickshaw-puller. There is also a tailor-made two-week programme for executives at IIM, Ahmedabad.

The results have begun to show. Goenka recalls a year in the early 1990s when he took on 18 management trainees. A year later, only one remained. It is with a touch of pride that he reveals the latest numbers. In 2006-07, as many as 50 management trainees joined. Only one has left.

In this era dominated by software and other services that are seen as glamorous, has it been an HR obstacle that none of RPG's businesses, bar retail, falls into this category? Goenka does not agree. A business can be boring, but the company may still be an attractive employer. As an example, he cites power major Enron before it went bust.

Conscious of my own waistline, I am sceptical of the dessert the waitress is offering. But Goenka suggests that perhaps we could share some. Picking on what looks like a delicious piece of cake, I ask what he thinks he has left to achieve after 25 years of being the CEO. Does he still dream? "I would love to be the Reliance [Get Quote] of India". My eyebrows shoot up. Reliance, for all its achievements, is also a case study in the extent to which two brothers can go to fight each other.

Perhaps realising my consternation, Goenka clarifies, taking us back to HR: "I want RPG to be the most exciting workplace in the country."



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