Interview of K. E. Ranganathan
Managing Director, Roca Bathroom Products Pvt. Ltd.
K. E. Ranganathan is currently the Managing Director, Roca Bathroom Products Pvt Ltd, 100% subsidiary of Spain based Roca Group, world leader in the definition of bathroom space. He works closely on creating new strategies and opportunities to drive growth and further consolidate the company’s leadership position.
Ranganathan is a graduate in commerce from Madras University, an Associate of Institute of Chartered Accountants of India (ICAI) and as Associate member of the Institute of Company Secretaries of India (ICSI). He is also a Full bright Scholar. He comes with more than 33 years of experience in finance, accounting, business planning, strategy, marketing &sales. He has held senior positions in various companies in Murugappa Group & TVS Group.
Not new to Roca Bathroom Products Pvt. Ltd, Ranganathan joined Murugappa Group in 1994 where he was Head of Finance for Parryware division and later took charge of the Sales & Distribution division. During his stint with Parryware, he brought a whole new perspective by refurbishing the key processes and focusing on result orientation, leading to sales growth at a CAGR of 25%. In 2005, Ranganathan headed Parryware business as the CEO and played a key role in transforming the business into a Joint Venture company with Roca Spain.
Q. Congratulations on your successful leadership in transforming Parryware and getting in a joint venture in ROCA Spain?
A. It has truly been an exciting journey. Parryware has always been a loved brand in India, built on a great legacy of more than 60 years.For over a decade now, Parryware is part of the Roca Group and is the flagship brand in the portfolio of Roca India. Roca Group is a 1.7 billion euros Spanish giant, and is a world leader in the definition of bathrooms. We work closely with Roca Group headquarters in Spain to bring to India many of the best practices of Roca group.
Q. What has been your experience in growing from a financial leader to a corporate leader? What are the challenges you encountered?
A. The journey has been enriching so far. All professionals start their career as a Functional leader and over time get exposed to other functions and some of us end up as Corporate Leader. I’m indeed thankful to TVS & Murugappa Group in giving the right exposure to various functions like Finance, Sales, Marketing, HR, Manufacturing, Sourcing, Logistics, IT etc. during my stint in various companies. That level of exposure, coupled with Academic training in IIM (AMP) & Carnegie Mellon (Fulbright) helped me gain deeper insights into how companies are running efficiently.
During my earlier stint in Parryware business in Murugappa Group, from 1994 till 2008, I was leading Parryware business as the Managing Director and was instrumental in forging the JV with Roca Group during the year 2005.
Even today in my new role, I work very closely with my team on understanding market realities, creating new strategies and opportunities to drive growth and further consolidate the company’s leadership position.
Coming to Challenges, obviously one has to have the ability to see the future and take on strategic decisions to charter the course of business. When I moved from core Finance function to Sales function, I had to learn the basic principles of Sales & Marketing management. Thanks to great guidance from my seniors and learning through reading, I could acquire some good knowledge. Later when I had the opportunity to Head the business in Parryware we saw the big change in market in terms of globalization of India market for bathroom products. That’s when we took the challenge of finding ways to counter the arrival of MNC brands into India. We forged a strategic Joint Venture with Roca Group which helped up further consolidate our No 1 position in India.
Q. What are the lessons you learned in course of transformation of Parryware leading to a sales growth at a CAGR of 25%?
A. Since its inception in 1952, Parryware has been a people’s brand. Beginning with its path-breaking Cascade design, Parryware became a household name in the Indian sanitaryware segment, leaving its competitors far behind.
Parryware was the first brand in India to define the bathroom space as ‘No more bathrooms … only Glamourooms!’ a campaign that changed the complete outlook of customer towards bathrooms. We went on further to elevate the buying experience of customers into different level at the retail stores by deploying contemporary retail practices and enhancing the quality of product displays.
Indian sanitaryware market has been growing steadily in the last few years. One major learning in the course of transformation of Parryware is that our offering should be in-line with the changing consumer demand and trends. Today, bathroom spaces have moved beyond functionality and are considered an extension of one’s living space. With changing lifestyle, Indian market offers immense business opportunity and we expect to grow much faster than other regions. Our focus is to offer trendy, luxurious, technology advanced bathroom fittings and accessories for our consumers, and that is the only growth mantra.
Q. Do you believe, GST will make it easier for companies in tax compliance? If so, how?
A. GST is a bold move by the Government to make business robust in a nation, which is a complex amalgam of diversity. The objective of GST is to simplify ease of business operation by bringing in uniformity in taxes across the country. All of us appreciate the intention and purpose of these initiatives. These are like medicine to cure the economic growth momentum and we should give some time for the medicine to work and bring the economy back on higher growth track.
With this, the ambiguity around prices due to multifarious taxes will get extinct. The composite tax GST should pave the way for easier administration of taxes and defined approach without ambiguities. This transparency will lead to better planning of resources and making goods available at attractive prices to end customers.
Q. What would be the impact of GST on Tax management of companies like yours?
A. India offers tremendous scope for growth for the organized players, especially after the introduction of GST and our growth projections are aligned to capture the expected shift for branded products.
As for bathrooms products the overall impact is marginal for sanitaryware and all those under GST tension can rejuvenate themselves with a good shower, as GST rates are attractive for taps and fittings.
Overall, GST will help bridge the gap between organised and unorganised sector contributing over 60% in volume terms. It will ease out everyday business functioning and make dealers focus on trade and distribution rather than on tax compliance and forms. It may allow them to usher in customer satisfaction.
Q. In managing the joint venture company with two different management cultures, what are the challenges you encountered and how did you manage them.
A. The expertise and revolutionary R&D technology of Roca coupled with the customers’ trust in Parryware has proved to be a potent force. This unique combination has helped both our brands grow and challenge their respective competitors like never before. We have been stressing on this differentiated approach for the last several years, i.e. establishing unique spaces for the two brands.
We need to put in a lot of money and effort to differentiate and promote our brands everywhere. The challenge is to synchronise the short and mid-term objectives in a market that’s so dynamic. As far as Roca Group is concerned, Investment in India is part of their long term commitment to be a trust worthy player in the market. Over the years, what we have been doing is building our brands step by step. We now have eight manufacturing units.
We are equally careful in choosing the products depending on usability and availability for Indian consumers we have a wonderful pyramid of products, globally, and depending on need and affordability we will launch them in India.
Q. CSR is the mandatory activity in India. What has been the CSR profile of your company? Which is your flagship program among your CSR activities?
A. Created in 2010, the We-Are-Water Foundation is a Roca initiative, which reinforces the brand’s historic engagement with society. We at Roca strongly believes that right to water, sanitation and hygiene is every human’s right. With a vision to alleviate negative consequences of access to water and sanitation grow, the foundation announced its launch in India this year and announced its flagship campaign ‘ShauchalayaApna, Bitiyaka Sapna’ targeted at improving the sanitation facilities for women & girl child in the country. We hope that this initiative of ours will provide better sanitation and hygiene facility to all especially women and girl child; and achieve the status of an open defecation free India.”
One key project undertaken this year was to improve the health, safety and dignity for families living in Bhiwadi, Rajasthan by providing sustainable sanitation solutions in the targeted villages. On this project, we have joined hands with Habitat for Humanity (HFH) India, a non-profit organization that builds homes and provides housing-related services to low-income, marginalized families across India.
Q. What is the level of your personal engagement in CSR planning and execution?
A. Currently our focus is to identify WASH projects (Water Sanitation & Hygiene) in areas around our factories so that our factory workers benefit from our small efforts. I work closely with my CSR team to understand the need gap in these areas to analyse and advise on how any investment, big or small may have a multiplier effect in order to bring about maximum change for maximum number of beneficiaries.
Q. What is the level of employee engagement in CSR activities of your company?
A. We have a small CSR team in place but at an overall level, our employees across regions and factories actively participate in identifying projects and supervising them. Over the years, the culture of social responsibility has become intrinsic at our company.
Q. What is the profile of impact made by your CSR activities?
A. Sanitation and hygiene are the most important factors to be addressed in India. The core reason behind lack of sanitation lies in the age-old practice of open defecation. Swachh Bharat Abhiyaan has given an impetus to sanitation programs all over the country.
In Bhiwadi, we have reached out to 1050 individuals through 210 household latrines. In its second phase, construction of additional 250 IHHL are underway. Another active project is the construction of 110 toilets in Anantapuram district in AP, in partnership with Rural Development Trust.Along with the construction, we try and focus on changing the mind-sets and behaviour in the affected areas of the country.
I hope this is just a start and with everyone’s support, we can achieve a nationwide open defecation free status soon.