Bharat Forge is the chariot that took India towards automotive innovation. It also happens to be the flagship company of the Kalyani Group, the world’s largest forging company – and the man behind its triumphs is Babasaheb Neelkanth Kalyani. Kalyani single-handedly transformed its turnover from three crores in 1973 to 16,000 crores as of 2014. Bharat Forge now has a transcontinental presence and is the largest manufacturer and exporter of automotive parts in the country.
Kalyani turns 67 today, and what this reflects more than his age is his long years of undeterred passion for automobiles. He was 14 years old when he first began driving, and the first car that he owned was the modest Fiat 1100. Times have changed since then, and nothing marks this transformation more than that of his asset, Bharat Forge.
Bharat Forge started its export business in 2002 and has since grown exponentially in the solutions it provides to the industry. It’s a leading example of how an industry can adapt to the modern global economy. Today, it is on par with 3D printing technology, which it uses to manufacture some of its automotive parts, and has recently joined in on PM Narendra Modi’s ‘Make in India’ campaign by tackling the Aerospace and Defence sector. It is also advancing hand-in-hand with energy-efficient technologies as the Group’s operations are running on its own wind turbines. But for now, let’s turn back the clock by 44 years.
It was in 1972 that Kalyani took charge of his chariot. He returned to India from the US as he felt that being with his family and building its business was worth a lot more than a career in the US, which he could have easily acquired with an illustrious degree from MIT. However, he lacked the patience to continue his father’s forging business and “wanted to grow a business via exports,” – an ambition that veered his direction, as it often does, toward entrepreneurship.
Until 1997, Bharat Forge’s focus was primarily the domestic market with only an insignificant portion of its revenues coming from exports. Kalyani completely turned this around when he began exporting automobile components to China in 2002. The key to this advancement was his visionary efforts in changing Bharat Forge’s business model.
“We believed that the system of cheap labour does not work. It will never allow companies to make high quality products, which is what is required in the global market place,” he explains in The Worldfolio. And so, Kalyani transformed the entire workforce from blue collar to white collar, and automated all their manufacturing plants.
At a time when there was no place for Indian manufactured goods in the global market, this strategy of investing in a foundation built on quality, leveraged the domestic market and allowed for the growth of a global company.
There was a lot of scepticism about India entering and competing with global companies of better technologies and capabilities. But as Kalyani himself puts it – “I am able to compete not because my labour is cheap, but because I can use technology better than others.” Thus he proved to the world that India not only had a chance with the big boys but could also give them a run for their money. “We converted the negative connotations that they had about India and Indian companies into extremely positive ones simply by performing.”
Vinod Dasari, MD of Ashok Leyland, recalled an incident with Moneycontrol which is an exemplar of Bharat Forge’s customer oriented business model. Bharat Forge once unduly impressed a European customer who, while expecting only a draft of plan before a deadline, was given a prototype part within the same time frame. It was this dedication that brought Bharat Forge loyal customers such as BMW, Audi, Ford, Toyota, and Volkswagen, and is the reason why every other heavy truck manufactured in USA today runs on a ‘Made by Bharat Forge, India’ front axle beam.
Today, if Bharat Forge is trusted by these big guns for its metallurgical knowledge and engineering, it is solely due to the leadership of this visionary.