Our aim is to enable progress of the customer’s manufacturing. To that end, we are focused on providing machines, and ensuring that our manufacturing competitiveness is enhanced, says Praful Shende, Chief Sales & Marketing Officer, Bharat Fritz Werner (BFW). In an exclusive interview with Shweta Nanda of MTW, he talks about the company’s thrust on innovation, its strategy to ensure customer satisfaction and environmental conservation efforts. Excerpts:
Q. With IMTEX round the corner, what are your expectations from the mega event being held in Bengaluru from January 24 to 30? What opportunities is BFW seeing by participating at IMTEX 2019?
IMTEX, being the flagship event, is a great platform to network, meet our existing and potential clients and of course showcase our new products. That said, we at BFW first and foremost view it as an opportunity to know and engage with clients from a wide range of segments, understand their requirements and current challenges. We then use these key points to design our future products and services.
At IMTEX 2019, we are set to display a wide array of new and exciting technologies, including advanced multi-process technology, high speed machining technology. We are also showcasing IRIS, our Industry 4.0 platform, and innovative products from our Kalam Center of Innovation.
Q. According to you, which factors are leading to the growth in Indian machine tools industry? Which industries are leading in terms of demand?
Indian manufacturing is growing and will continue to grow. There will be a few glitches here and there in the short term but by and large the outlook looks positive. The government also continues to provide major impetus on manufacturing to enhance its share in GDP to rise to 20% from current 16%. Consequently, machine tools being the mother industry is also growing.
Automotive /auto components sector has been at the forefront of growth and will continue to hold a major share, especially due to shift from BS-IV to BS VI norms by 2020. Commercial vehicle segment will continue to grow on account of thrust on infrastructure. Apart from automotive, infrastructure, railways, MSME job shops, die and mold, and electronics are other significant segments driving the growth.
Q. How well is India positioned in the global machine tools market? Comment on the major challenges for the machine tools industry in India.
As per the latest Gardner Business Media survey, India is within top 10 machine tools consuming nations globally. Although there is a jump in ranking from the previous years, in absolute terms, machine tools market is still a 2 billion dollar industry with equal share of imported and Indian machines. That said, there is a lot of opportunity for the industry to grow and scale.
The challenge for the Indian machine tools industry is two-fold. Firstly, in bringing new technology and scaling up for existing product lines. For instance, new technology, such as multi-processed technology is not readily available. Secondly, the Indian machine tool players are primarily busy meeting the demand of local market, while exports are a bit on backburner. I believe, that for the next level of growth, the focus on exports needs to be enhanced. The industry needs to access markets outside India and establish the ‘Make in India’ brand. We, at BFW are focused on both these issues.
Q. Industry 4.0 is a buzzword that is bringing a shift in the industry. Tell us about BFW’s focus on Industry 4.0. In your observation, how ready are Indian manufacturing companies for these technologies vis-à-vis global peers?
Industry 4.0 is a broad term. In Indian environment, it signifies evolution of an ecosystem where the customer, manufacturing, organization, supply chain—all these elements will have to stay connected to respond to the needs of the shop floor in real time. The top expectation and priority of Indian companies from Industry 4.0 is increasing productivity of their asset. So, in India the focus on Industry 4.0 is essentially asset productivity driven, while the Western world continues to put big thrust on technology.
We at BFW aim to keep things simple, because a large section of Indian manufacturing industry consists of MSMEs. We are focusing on helping our clients increase productivity without making the whole subject complex. IRIS, our platform for Industry 4.0, is a simple solution that enables our clients to know why their machine is not producing to its optimal level and provides them ability to act in real time to see it work. It attempts to make the machine more and more intelligent.
In terms of readiness, Indian companies are not totally ready for Industry 4.0. Tier I large organizations have understood the subject—some of them are putting plans in place and some of them have taken the steps ahead. However, a large part of MSMEs are not yet on board. I believe the real game will change once the MSMEs get ready to join the movement and that is where IRIS will play an enabling role.
Q. In your observation, what are the expectations and demands of Indian buyers? How does BFW facilitate the customers and ensure that their demands are met?
Customers are demanding cost-effective automation, increased production and multi-operations in a single machine. They are expecting fusion of technologies and also customized products.
At BFW, we are co-developing products along with the customers, by understanding their needs and replacing expensive import substitutes. Our thrust is to give them appropriate solutions and our wide product portfolio in terms of turning, milling and special machines allows us to customize the products and meet their unique requirements.
Q. Please update us about your achievements on the R&D side.
We at BFW strongly feel that innovation is critical to growth. To fuel innovation we have a dedicated center named after visionary Dr. A.P.J. Abdul Kalam. Our Kalam Center of Innovation is committed towards doing meaningful development on the technologies related to the machines of the future. For us, the focus of R&D is not on product development but technology development. We are exploring the usage of alternative material for the making of the machine structures and improving its performance. We are also working on technologies that will ensure stable performance of a machine in tropical environment.
Due to our efforts in R&D and some breakthrough innovations, the Confederation of Indian Industry (CII) recently recognized BFW as one of the top 25 most innovative companies in India. We are the first one from the Indian machine tools fraternity to be featured in the prestigious group. It is very motivativating for us to grow the culture of innovation within BFW.
Q. Tell us more about your environment friendly measures.
BFW has always been a leader in undertaking environment friendly initiatives. At the product side, we ensure that our products are greener by adhering to the standard norms for new product development. We work towards ensuring that our products consume less electricity and have a low carbon footprint. We are innovating to recycle industrial waste of other industries.
In addition, we follow environment friendly practices at our plants. We do rain water harvesting and horticulture at both our plants in Peenya, Bangalore and Hosur, Tamil Nadu.
We have setup a solar power project that supplies power to the entire facility in Peenya. The 980 kWp solar project generates 15 lakh units of energy which helps us in meeting our power requirements. This plant has helped us offset 1,350 tons of carbon emission every year. Based on this experience, we are exploring similar deployment at our Hosur Plant.
Q. What is your future vision and growth plans for the company?
Our direction, since inception, has been to enable progress of the customer’s manufacturing. We strive to provide optimum technology solutions to our customers be it process solution or product solution. We are not just focused on providing machines, we are focused on making sure that cost-per-piece becomes more effective for the customer once he uses a BFW solution.
Looking ahead, we are planning to grow ahead of market growth by few percentage points and aim to double our manufacturing capacity. We have recently opened a new manufacturing plant at Hosur, which is spread across 35,000 sq. ft. and includes significant numbers of modern machines to enable integration of existing foundry facility with machining capability. The Industry 4.0 compliant factory and all the manufacturing processes here are designed to take it to next level through digitalisation and superior engineering to ensure cost efficiency, increased productivity and shortened manufacturing time. Further, we are exploring our next expansion with a new plant about 18 to 24 months down the line, depending on how the market continues to grow.
We focus on technology & platform developments
The home grown ELGi Equipments Limited is today the 7th largest manufacturer of air compressors in the world. The company with a broad line of innovative and technologically superior compressed air systems has earned the worldwide distinction of having designed sustainable solutions that help companies achieve their productivity goals and keep the cost of ownership low. The Indian MNC’s ambition to seize the No.2 position in the world by 2027 is not without substance. It has the technology, products and the people to achieve this, according to Anvar Jay Varadaraj, Head – Marketing & Corporate Communications at ELGi. The foundation of the company’s aspiration is also based on the fact that it is one of the three global players with the full range of compressed air systems, discovers P.K. Balasubbramaniian in an interview. Excerpts:
Q. ELGi is an Indian MNC in Air Compressors. What’s your standing today and how do you plan to push your global ranking to a notch above?
ELGi is currently the seventh largest air compressor manufacturer in the world. Our ambition is to be number two by 2027. Amongst the global players, we are one of three companies with the full range of products, which is the foundation for our aspirations. We believe that reliable products with industry leading energy efficiency will be critical to our growth. We have had a strong start in quality conscious markets such as Europe and the USA and we believe that we will grow steadily as more customers and distributors experience our products.
Q. What are your strategies to accelerate your growth?
As we grow to number two, we believe 30% of our growth will be fueled by organic growth in markets, while 70% will come from inorganic avenues such as acquisitions. We will focus on “access to market” acquisitions such as distributors.
Q. How do you propose to step up your infrastructure and resources to achieve the goal you have set for yourselves?
Our current infrastructure will hold us well for sales increases over the next five years. However, as we grow sales in key markets such as the USA, we will consider on-site manufacturing to improve our service to our customers and distributors. To this end, we have projects underway to envision the ideal ELGi factory in the USA taking into account factors such as higher labour costs.
Q. What’s your present range of manufacture? Any new additions in the anvil as a result of your rigorous R & D?
ELGi currently offers the full range of compressed air solutions and services. For products, we have both lubricated and oil free reciprocating compressors. Starting from 1 HP and supporting applications such as small scale manufacturing and auto workshops, our lubricated reciprocating compressors offer decades of reliable operations. Our oil free reciprocating compressors support clean air sensitive applications such as pharmaceutical manufacture and textiles. Our oil lubricated screw compressors support a vast array of industries starting from 7 KW with the aim of providing the lowest ownership cost experience, which includes upfront price, energy consumption, and maintenance. Our screw compressor range also includes oil-free machines which are built around our proprietary oil free Airend design and produce class zero air for large scale pharmaceutical manufacture and textiles. Our screw compressor range extends to portable and skid compressors. Portable compressors are either powered by an electric or diesel motor and are critical for applications such as mining and road construction. Our skid compressors, mated to diesel engines, are used for water well applications. Finally, we have our centrifugal compressor range that supports large capacity air requirements for industries such as power, textiles, and cement.
Q. As a trendsetter, what are the technological innovations you have showcased recently?
As our IOT initiative, we have launched Air Alert, a communication device embedded in our screw compressor range to transmit critical compressor to ELGi. We will use algorithms to continuously monitor these machines to provide failure prevention, proactive maintenance, and quality improvement. With Air Alert, customers can rest assured that their ELGi machines are under constant surveillance. By the end of the calendar year 2017, we will have 500 machines fitted with Air Alert and by the middle of 2018, all of our machines will have Air Alert as standard and at no additional cost.
Q. What’s your level of success in producing energy efficient compressors of superlative quality and performance?
Our technology roadmap considers energy efficiency as a key driver. We initially aimed to match the best in terms of quality and energy consumption. We are proud to note that we are amongst the most efficient and most reliable machines in the industry. Our success in the USA, for example, is testament to our products’ quality and reliability. Our current goal is to be unequivocally the best in terms of quality and energy consumption, both critical parameters for an Indian brand competing with European brands.
Q. How would you summarize your major strengths, capabilities and resourcefulness?
We live by the mantra that the customer is always right. This mantra is our strength as it has instilled values amongst our team where no one tolerates compromises to the customer. If customer- centricity was not central, then our products and technology won’t count for much.
Q. What are the calculative efforts you make to improve your brand value?
We aim to be thought leaders in compressed air. To this end, we’ve invested in platforms such as LinkedIn, Facebook, and our blog (The Compressed Air Journal) that will allow us to create and share meaningful stories about ELGi.
Q. What’s your customer base? And how do you delight your customer offering tangible benefits and lasting values?
Any operation that uses compressed air is our potential customer. We delight our customer by offering the lowest ownership cost experience in the world, bar none.
Q. What’s exciting at ELGI today?
Our aspiration to be number two in the world energizes the whole company. We believe we have the technology, the products, and the people to achieve this.
Q. Is ELGI a classic example of eminent Indian engineering that makes India proud?
While this is a work in progress, ELGi is a good example of home grown technology leading the charge towards dominance in an industry. Today, we have “know why” on compressed air technology, which will allow us to develop the compressed air products of the future. We’ve built this “know why” over decades of investment into our team and our R&D function. We are proud today to have engineers with us who have grown from campus developing their own world class designs and producing industry leading designs.
Q. You are quite visible on the CSR front. Could you throw some light on your recent initiatives and the results?
We would like to highlight two initiatives. First, we have a vocational training program at ELGi that has been designed around German vocational training principles. We identify high performing students of limited means from neighboring towns and villages who have completed the tenth standard and enroll them into a three year program with the goal of placing them in different areas of air compressor manufacture. By doing so, we guarantee that our labour talent is aligned to our expectations of quality and character, while offering these students an opportunity to cement their careers. So far, we have placed more than one hundred and ninety students.
Second, we run the ELGi school which aspires to provide a best in class science and math education for children from destitute backgrounds. The school enrolls 1400 students and we aspire to build residential facilities with the aim of inducting more students from orphanages.
