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Wheeling, dealing

Maruti Chairman R C Bhargava spoke to Sumant Banerji on the company he keeps.

books Updated: Apr 09, 2010 23:52 IST

The Maruti Story
R C Bhargava with Seetha
Collins Business Rs 499 pp 383

The best man to write the story of Maruti, the company and the car that set India driving, has to be R C Bhargava. He's the current executive chairman, but Bhargava's association with the Maruti project is the stuff of legends.

In an informal chat, Bhargava spoke about the car that changed India, his personal role in the continuing road journey, and the reasons for writing a Maruti book at this juncture. Excerpts:

Why did you write this book?
Whatever has been written in the book is not only about why and how things happened, but also about what the management lessons were. The pedigree of public sector undertakings in the country isn't great. But Maruti, despite being a 74 per cent government-owned company, never ran into cost overruns and always exceeded its production targets. The work culture is totally different from any other company in India. Today Maruti has the highest productivity across all industries in the manufacturing sector.

There is a lot of 'I' in the The Maruti Story. Was that deliberate?
It's a Maruti story told from my perspective so there has to be 'I' in it. It's still a book on Maruti and the company's growth from the beginning. But as far as a source for the writing goes, there was only me and my memory.

Was Maruti India's answer to the 'Toyota way' of lean manufacturing?
The Japanese way of lean manufacturing is very popular now. But how many [companies] have been really able to learn and implement it? The big lesson that we had to learn from the Japanese was the lack of stringent hierarchy. In Indian society, we still have the caste system based on birth. But in the industry, we have a caste system based on wealth, education and status. It is also a problem in the United States and Europe. Only in Japan there is no differential.

Does that mean a CEO and a shop floor worker are equals?
In Japan, the CEO earns five to six times the salary of a basic worker. In India, that differential is roughly 200 times. In Maruti, the differential is in the range of 55 to 60 times. In the long term view, the growing disparity between top management and workers is not sustainable and it'll lead to complications. Competition between political parties is increasing and the organised workforce is a vote-bank.

How then would you explain the labour union strike of 2001?
That I believe was an aberration. It was a management fault as the union and the workers got involved in management politics. Matthew Abraham, the then union leader, aligned with the CPI [Communist Party of India], took sides with [former Maruti Udyog Managing Director, R S S L N] Bhaskarudu. It was a political issue. To [Bhaskarudu's successor Jagdish] Khattar's credit, he handled the situation very firmly. While the strike continued [for three months], production did not suffer.

If any of the other influential Maruti officials like V. Krishnamurthy or Khattar were to write a book, will it be somewhat similar to yours?
Khattar's book will be different as it will cater to a different age of Maruti. He came in much later and stayed on while I left. Even Krishnamurthy's book will be different as he left active role in 1985.