Entrepreneurs are job creators
Rather job seekers
I am indeed delighted to be here and address the young entrepreneurs as a part of the Outreach Advocacy Programme organized by Ministry of Micro, Small and Medium Enterprises at Chennai. I am happy that MSME development institute is using technology as a medium of education for large number of participants spread across the country. In addition to promoting soft-skills, I would suggest the institute to create a technology bank which can be use by the perspective entrepreneurs for starting their enterprises. For example, there are many areas in energy sector such as attachment for emulsification systems, converting seeds to esterified biofuel which are required in every village. My greetings to the Director, entrepreneurs, prospective entrepreneurs and the policy makers. On this occasion I would like to talk on the topic "Evolution of Entrepreneurs".
Since I am in the midst of entrepreneurs and prospective entrepreneurs, I would like to give the linkage between national economic development and creative leadership.
Economic development and prosperity
- Nations Economic development is powered by competitiveness.
- The competitiveness is powered by knowledge power.
- The knowledge power is powered by Technology and innovation.
- The Technology and innovation is powered by resource investment.
- The Resource investment is powered by revenue and return on Investment.
- The Revenue is powered by Volume and repeat sales through customer loyalty.
- The customer loyalty is powered by Quality and value of products.
- Quality and value of products is powered by Employee Productivity and innovation.
- The Employee Productivity is powered by Employee Loyalty, employee satisfaction and working environment.
- The Working Environment is powered by management stewardship.
- Management stewardship is powered by Creative leadership.
For success in all missions we need creative leaders. Creative leadership means exercising the vision to change the traditional role from the commander to the coach, manager to mentor, from director to delegator and from one who demands respect to one who facilitates self-respect. The higher the proportion of creative leaders in an organization, the higher the potential of success and the growth of organization and thereby leading to accelerated national economic growth. I am sure, the outreach programme conducted by the Ministry of Micro, Small and Medium Enterprises will facilitate generation of large number of entrepreneurial leaders.
Defeat the problem and succeed
Dear young friends, when you enter a new assignment as an entrepreneur, I was thinking what experience, I can share with you. After giving a big project to me to be completed in seven years, Prof. Satish Dhawan gave me one advice. That advice stood with me all the times in my career. I consider that advice may be applicable in the new entrepreneurs also. My chief gave me the advice "if do a new mission or a complex tasks, you should also expect to experience equally challenging problems. You should not allow the problem to become your captain. You should become the captain of the problem, defeat the problem and succeed". This may be true for everyone of you in the decision making process, venture capital acquisition, equipment procurement, commissioning equipment, paying back large loans, acquisition of human resource, training of human resource, marketing of your products and everyone of your day-to-day activities as an entrepreneur. Till you break even and start making profit, you will have to have a willpower which is stronger than diamond. I am sure, you will develop this trait and become a very successful entrepreneur. Let me now discuss the law of development which should be known to every entrepreneur.
Law of development
I was studying the development patterns and the dynamics of connectivity between nations, especially in trade and business. As you all know the world has few developed countries and many developing countries. What is the dynamics between them and what connects them? Developed country has to market their products in a competitive way to different countries to remain as developed country. The developing country to get transformed into developed country; they too have to market their products to other countries in a competitive way. Competitiveness is the common driving factors between the two types of nations. Competitiveness has three dimensions: quality of the product, cost effectiveness and product is in the market just-in-time. Indeed this dynamics of competitiveness in marketing of products by developing and developed countries is the law of development. There is a relationship between the core competence and the competitiveness of the country or the enterprise. Such a law applies to all the enterprises in the country.
Now I would like to give three case studies of entrepreneurs who have taken up entrepreneurship and succeeded in a competitive environment.
Sakthi Masala the household name among the million today, had a humble beginning 33 years ago. Mr.P.C. DURAISAMY, the Founder of the Company was a small time turmeric trader, from a village called Perundurai near Erode. He founded SAKTHI TRADING COMPANY in 1975 and was doing Turmeric Trading for some time. Later he entered into the arena of pure spice powders like Turmeric, Chilli and Coriander. His inquisitiveness led him to enter into masala world with boldness. He encountered a lot of hurdles, since selling masala powders during those days to the oriental women who are traditionally conservative, was not that easy. It was concept selling on "Easy Cooking" rather than marketing food products. With self determination and persistent attempts, he was able to get into the kitchens of our country. What was started with Rs.10,000/- in 1975 has now transformed into a corporate house with an annual turn over of over Rs.274.79 crores during the financial year ending 31st March 2009. Hard work, sweat and the perseverance to overcome the problems encounter has been responsible for this success. His life partner Mrs. Santhi Duraisamy has stood behind Mr. PC Duraisamy in all his achievements and sufferings. Now SAKTHI MASALA manufactures over 50 varieties of spice and masala powders, over a dozen varieties of pickles, flour varieties, appalams and ghee.
Success of SAKTHI MASALA lies in the innovation of manufacturing procedures in the 1980s, there were no machineries available on the shelf for production of spice and spice mixes. The experience of manual production for slowly incorporated for design of machineries which made the difference in manufacturing of spice and spice mixes keeping the aroma and flavour intact. Blending of technology and tradition is the secret of success of Sakthi Masala.
Today, the company uses modern technology in drying the new materials using solar power. The company also uses wind energy for roasting, grinding and packing the products. For its unique production characteristics Sakthi Masala has been honoured by several awards. Another unique feature of Sakthi Masala is that the company employs specially abled people as part of its work force. These specially abled personnel are selected, trained and prepared for rehabilitation and work as a part of the human resource development programme of the company.
Susira is a case study pertaining to a young engineer who had the passion to become an entrepreneur particularly in the auto-component manufacturing sector. With a resolve to emerge as an entrepreneur of repute and to become a job creator rather than a job seeker, Shri S. Sitaramaiah left his corporate job and started Susira with a modest sum of Rs.40,000/- that he could get by way of Provident Fund savings and Gratuity. He had to cross many obstacles and face several challenges before succeeding in his business. Susira was started in 1976 and today Susira has been transformed into a job-shop to a component manufacturer and is also producing and supplying engine valve pushrods to an engine manufacturers. The transformation has been facilitated due to the perseverance of Susira in maintaining excellence in the product quality.
Susira is an example of giving value to human resource for development of complex product. When Susira started manufacture of Valve Push rods, it did not start with any imported technology or sophisticated state of the art machines. But it started with its people. People that synergized and developed a viable production system with the available production systems in the country and produce components meeting the stregent quality requirement of the original equipment manufacturer. Its belief in people also made a big difference to its competitiveness. As they say "One machine can do the job of 50 men but no machine on earth can do the job of an extra ordinary man. It is thus imperative for organizations to note that without the contribution of committed worker, we cannot succeed. During the last 33 years, Susira has been able to derived maximum benefit from its workforce and has not lost even a single hour by way of strike or lockout. This has made possible through a very transparent human resource, development, deployment and relations policies maintained by the company.
The CEO of the company talks to the workmen on every pay-day when both shifts meet and apprises them about the status of industry, performance of the previous month and important future plans of the company. This enables the employees to become partners in the decision making process in the company. Similarly, at all levels two way communications organized for the fixed days of the week for discussing quality and productivity issues. With this approach, Susira has been able to achieve best quality, lowest cost and ensure timely delivery.
To ensure sustainability of the competitiveness, SUSIRA has established four specific task forces each task force being charged with the responsibility of improving quality enhancing productivity reducing waste and cost and value engineering respectively. Susira has received many awards for its impeccable track record in product performance and delivery.
Dr. Karansbhai Patel and the birth of Nirma
Dr. Karsanbhai Kholidas Patel is a renowned Indian industrialist known for establishing the Nirma Group which is now, a company with revenue of Rs.3350 crores with major interests in soaps, detergents, cosmetics and education.
The story of Nirma and its founder, has become a classic as a marketing case-study. Karsanbhai finished his graduation in Chemistry at age 21 and worked as a lab technician, at the Geology and Mining Department of the state Government. In 1969, at the age of 24, Karsanbhai set up Nirma, selling detergent powder. This was an after-office business - the one-man company would bicycle through the neighbourhood selling handmade detergent packets door to door. Three years later, Dr. Patel left his government job and pursued Nirma as a full time enterprise.
Nirma evolved as a customer centric company with a focus on better quality at an affordable price. The mission of the company was "Better Products, Better Value, Better Living". At a price of one third the price of leading detergents, it was an instant success. The high quality and low price of the detergent made for great value and Nirma revolutionized the detergent market, creating an entirely new segment of economy detergent powder. At the time, detergent and soap manufacture was dominated by multinational corporations with products priced around Rs. 13 per kg, while Nirma was priced at Rs. 3/kg. Within a decade, Nirma was the largest selling detergent in India. In this process, Nirma also provided value added employment for large number of people coming from economically weaker section of the society.
Nirma also became a leading employer, growing from one man company in 1960s to now over 14,000 employees. From a local neighbourhood market, Nirma today caters the remotest villages with 2 million retail outlets across the nation. Made without some phosphates, Nirma is also more environment friendly.
Nirma also diversified into other products, like soaps, industrial products, salt and also in education sector. Overall Nirma has a 20% market share in soap cakes and about 35% in detergents. Nirma has also penetrated into international market due to its extremely competitive price and quality.
I am sure, all of you participating in this outreach programme will emulate the Sakthi Masala, Susira and Nirma model of entrepreneurship and succeed in your entrepreneurial journey. I would suggest some of you to create enterprises in PURA complexes (Providing Urban Amenities in Rural Areas) which will not only service in the rural area, but also act as a route for reverse migration of technical personnel.
Profit with integrity leads to sustained growth. How is it possible? We need to have National ethics for sustained growth and peace. Where from it starts?
- Nation has to have ethics in all its tasks, for sustained economic prosperity and peace.
- If nation is to have ethics; society has to promote ethics and value system.
- If society is to have ethics and value system, families should adhere to ethics and value system;
- If families have to get evolved with ethics and value system, parenthood should have inbuilt ethics.
- Parental ethics come from great learning, value based education and creation of clean environment that leads to righteousness in the heart.
As you are all setting your goals for becoming a 21st century entrepreneur, I would like to conclude with an inspiring message from Maharishi Patanjali in Yoga Sutra:
"When you are inspired by some great purpose, some extraordinary project, all your thoughts break their bounds, your mind transcends limitations, your consciousness expands in every direction, you will find yourself in a new great and wonderful world. Dormant forces, faculties and talents become alive and you discover yourself to be a greater person by far than you ever dreamed yourself to be."
I am sure, this message will inspire all the participants to unleash their capabilities and emerge as great entrepreneurs which will facilitate India to become an economically developed nation by 2020.
My best wishes to all the participants success in their entrepreneurial venture.
May God Bless you.
-- Dr. A.P.J. Abdulkalam