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Four lessons of change from Tata Communications CEO

By Shyamal Majumdar and Abhineet Kumar
Last updated on: May 25, 2015 14:22 IST
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Unlike many of his peers in corporate houses, Kumar doesn't have an MBA but says that hardly matters, as he has been lucky to have got great on-the-job experience, such as during his stint in Asia Global.

Vinod Kumar gave up golf, which is almost every CEO's favourite sport, a few years ago and took up polo instead.

This should be a normal personal preference, but Kumar proceeds to give us four reasons for the change.

One, golf wasn't giving him enough exercise; two, speed and agility are what he considers his management style and fits in well with a fast game like polo; three, the game is all about learning the spirit of survival and fierce competitiveness; and four, he has "learnt humility" from horses. He isn't finished as yet on the fourth reason.

"The emotional quotient of the animal helps it understand a man's feelings towards it. If you go to a horse thinking you are the master, usually you find yourself on the floor.

You have to treat them like a partner and polo helps you find the inner calmness that helps the partner to respond to you," he says.

We wonder whether any polo enthusiast has ever looked at the game as such a vast laboratory of management lessons.

But the 50-year-old managing director and chief executive officer of Tata Communications obviously knows how to extract more out of every move of his.

For example, 15 years into his career, he quit the CEO's job at WorldCom, the first foreign telecom carrier in Japan, to join Asia Global Crossing, a bankrupt company.

The move surprised many but Kumar knew exactly what he was getting into. Handling a turnaround experience was something that was missing from his CV till then and he got valuable lessons on financial restructuring.

After the company's sale to China Netcom, which eventually gave birth to Asia Netcom, he joined Tata Communications.

We are at Yauatcha in Mumbai's Bandra Kurla Complex, which is close to the Tata Communications office and Kumar says he would have been happier to host us at the company guest house where he stays during his trips to Mumbai.

The chicken and prawn starters are delicious, though Kumar seems to be a sparse eater.

That's perhaps the secret of his lean frame. He is based in Singapore but spends roughly a week in India every month.

Isn't it rather unusual that the CEO of an India-headquartered company is based in Singapore, we ask and the response is quite detailed: the headquarter concept is meaningless for a business that Tata Communications is in since the business heads are in five cities around the world, international operations account for 77 per cent of revenue, 75 per cent of the 7,700 employees are located abroad and the company serves customers in more than 100 countries.

Unlike many of his peers in corporate houses, Kumar doesn't have an MBA but says that hardly matters, as he has been lucky to have got great on-the-job experience, such as during his stint in Asia Global. There have been other occasions, too.

The electrical and electronics engineer from BITS Pilani says he was entrusted with profit and loss responsibility at age 28 when his first employer, Sprint Corporation, relocated him to India from the US to start a joint venture operation.

The flexibility and agility that he has learnt from his favourite game have also helped him to be at the forefront of the erstwhile Videsh Sanchar Nigam Ltd's transformation from an India-based traditional network services provider to a global company offering a broad range of managed communications along with information technology (IT) infrastructure services.

As traditional sources of revenue - voice and data - show signs of waning, the telecom and IT services company is gradually switching into a new role - an end-to-end service provider to enterprise customers. And the efforts have paid off as the company finally reported net profit of Rs 101 crore in 2013-14 on the back of Rs 19,665-crore revenue.

The growth has been stupendous indeed. In 2002, the company had five international gateways and one customer, Bharat Sanchar Nigam Ltd.

Now, it serves 1,600 service providers in about 50,000 enterprises all over the world.

It is also the only player from emerging markets that's there on Gartner's leadership category with players who have been in the business for over three decades. Doing so has been no mean feat.

That explains programmes such as Moonwalks, which is all about exploring new industries and subjects and innovative programmes on cost optimisation, which took out $100 million of cost without reducing the headcount.

Kumar says there are plenty of examples of businesses that have launched a 'halo' product or solution, which has had a huge impact on the market and catapulted the brand - and its leaders - to success. However, maintaining that success is where the difficulty lies.

If businesses want to stay on top, they must avoid complacency and ensure that they continue to innovate and evolve, rather than resting on their laurels.

That's why his management philosophy has been to challenge all employees to have a start-up mentality.

"There are plenty we can learn from start-ups, and we've taken some of those learnings on board with our internal innovation ventures, as the whole idea is to get people to be comfortable with something they know nothing about," he says.

The main course comprises white chicken fried rice and Lan Ching chicken. Kumar goes on to talk about the reasons for his frequent visits to Silicon Valley.

He takes top- and middle-level managers to the innovation valley and puts them into an immersion programme, where they learn about cutting-edge technology across sectors as varied as pharma, biotech, health care, robotics, and genomics to understand how fast technology is transforming our world.

"Everyone comes back a different person, paranoid about change. Most of our trips to Silicon Valley are about telling ourselves how ignorant we are," he says.

We ask Kumar if he would like Tata Communications to be described as the first telecom company in the Tata group to turn profitable.

"That's a dangerous question for me to answer, but it is a fact," says Kumar.

His diplomatic instincts take over soon. "This should not be construed as a judgement on other people, as their business is different from ours," he clarifies.

Kumar joined the Tata group firm in 2004 to build its global operations and was closely associated with the acquisition of Tyco Global Network and Teleglobe that strengthened the company's undersea cable network across the globe.

Rewards came fast as he became the MD and CEO in 2011 after heading the company's international operations.

In the last six years, Tata Communications has spent over Rs 16,000 crore or Rs 160 billion in building infrastructure by laying new network, setting up data centres, switching fabrics and so on, as it increased its focus on emerging markets in Southeast Asia, West Asia and Africa.

Kumar has had to take quite a few tough calls, too, as last year the company pulled out of its investment in South Africa's second largest telecom network operator Neotel.

Kumar proceeds to explain this by saying that the company had thought Neotel would help create another home market after India, but realised it required a very different magnitude of commitment. Kumar loves to showcase his company's contract with the Formula One Group, which is in its third year now.

Under the deal, Tata Communications provides the technology backbone for F1 races under the franchise - something that has gone a long way to raise the visibility of the corporate profile and portfolio of services to its target customers. He ignores dessert and as the lunch comes to an end, Kumar looks relaxed.

He doesn't even mind laughing at his own expense and says he is quite comfortable with his surname as it's "neutral" and people are generally confused about which part of India he comes from.

"I tell my foreigner friends that when Indian families come up with a name, they throw Kumar at it, which can stick anywhere - in the front, middle or the end, depending on convenience," he says.

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Shyamal Majumdar and Abhineet Kumar
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