My Journey as a consultant - 5

 Two Early Clients and Lifelong Association

Early in my career as a management consultant in 1984, I worked on assignments with two well-known and respected entrepreneurs in Hyderabad. These assignments blossomed into lifelong relationships with the entrepreneurs, which gave me immense satisfaction and a firm conviction that I was on the right track. Successful consulting businesses are built around such lifelong associations established through building trust and adding value to the business over time. Here in brief are the actions that led to career-changing associations for me and my associates.

 

They were much older Individuals and came from two opposite ends of the entrepreneur spectrum. One was a technocrat with foreign education coming from a well-to-do community from the interior of Andhra Pradesh. The other was from a Gujarati trading community from the Kutch region whose family had settled down in Hyderabad several generations ago and had an established traditional trading business. He was not formally educated beyond high school or intermediate level but the first person from that family who decided to venture into manufacturing in engineering. Both were very successful in their respective businesses. Both had different approaches to their business. The technocrat understood technology and focused on developing new products and launching them every year. The businessman used his acute sense for managing money and using technology to establish niche businesses.

Mr D V S Raju was the founder of Elico Private Limited in 1962. He had a background in instrumentation engineering and was a first generation entrepreneur. After going to the UK for higher education, and having worked with a large electronics company there, he decided to return to India and start his own business. He found that the National Research and Development Council (NRDC) had developed several products and offered the technology to potential entrepreneurs to commercialise these products for a nominal fee. Mr Raju bought some of these basic designs along with their prototypes and, using his engineering skill, made them into commercially marketable products. Since most of his products were cheaper substitutes to imported ones available in those days, his company, Elico Pvt Ltd, became an established player in their business very soon. 

I had first met Mr Raju around 1979 as my customer, when I was working for a public sector company supplying imported electronic items required by the electronics industry. Later, when I started on my own, I contacted him around 1984 to look for business based on my unique value proposition. Since I had an electronics engineering background he felt I would be able to understand the technical nuances of his business and decided to hire us.

He had the same set of problems that have been mentioned in my earlier posts (see my blog My Journey as Consultant - 3). After my feedback, he decided to engage me on a regular basis for addressing various problems of management that he was facing. During this period he also decided to diversify into manufacturing other electronics products unrelated to instrumentation, like telephones, speakers and personal computers, and involved me with those diversifications. Since he was not exposed to the emerging new technologies, he took my help to connect with some of my classmates from IIT Bombay who were offering technology consultation based out of Bombay and Pune, and took me with him to various government organisations involved in approving these projects in New Delhi to present these project proposals. 

What I discovered during this time was that he was trusting me more than his regular employees. Apart from this, he started introducing me to other business units and local government agencies promoting small and medium businesses by registering me to attend their seminars on behalf of Elico Pvt Ltd. This led to wide exposure for me among small and medium business units and I got small assignments from some of them. He went one step further and invited me to join the Rotary Club of Hyderabad North, where he was a founder member since 1966, and got me admitted to that club in 1986. This club had many entrepreneurs operating from the same or nearby industrial estates and many of them approached me for help. 

As he got older, and found managing the day-to-day affairs of Elico strenuous, he handed over the business to his nephew and focused his energy to working with Instruments Society of India. When he took over as its President, he invited me to help him perform his role effectively. Even after I had moved on to look for and get work from large corporates from 1993, when the Indian business environment changed giving consultants like me opportunities, he continued to call me to help him in some aspects of his work life, which he never stopped till he passed away in 2005. He always introduced me as his Management Consultant, emphasising that he valued me as an important person in his life, like one does with a lawyer or doctor or chartered accountant or an architect, at a time when management consultants were not recognised like the other professions with any legal status.

Mr Bhanu Sanghani was a soft-spoken businessman who founded Unicorn Industries Pvt Ltd in the early 1970s when Amul, the famous milk brand from Gujarat, was looking for Indian suppliers for setting up new milk plants across the country on behalf of National Dairy Development Corporation. He had met the legendary Verghese Kurien who encouraged him to set up the facility to fabricate stainless steel products required for dairy and other food industries since the imported equipment was very costly. Mr Sanghani, with his business acumen and strong networking ability, succeeded in building Unicorn Industries as a name to reckon with for manufacturing stainless steel equipment not only for the dairy industry but also for other food and beverages industries which needed them.

I literally bumped into Mr Sanghani over a cup of tea during a seminar organised by the Hyderabad Management Association. After self-introduction and exchange of information about each other, he gave me his visiting card and asked me to call him and meet in his office. The way he talked to me, he sounded very soft spoken, very inquisitive and always looked eager to learn. I was quite impressed with him. 

After a couple of days, I called him up and met him at his office at the appointed time. He delved deeper into the kind of work I had been doing and was keen to understand the value-pricing model and how I used it to ensure that the engagement with a client was beneficial to both. During this meeting, he also expressed his disappointment with his inability to study beyond intermediate level and made sure all his four sons went to college. He even encouraged two of his youngest sons to go abroad and get qualified in some specialisation of their interest. 

All his sons were involved with his business at the time I met him. He had already diversified into other businesses and the eldest son was handling that project. The second son was actively involved in running the dairy equipment manufacturing plant and he was thinking of helping the last two to start a new business based on their interest acquired abroad. He introduced me to all his sons and I was wondering why he was sharing all such information with me. Then he said he would call me one of these days with a specific aspect of his current business and take my help. After a few weeks, I got a call from his office and, when I reached there, found his second son in discussion with his accountant on how to get proper management information quickly from their accounting information. He posed his problem to me, saying that, though they maintained all the books of accounts manually, they did not get any financial analysis done fast enough, and ended up with guesswork to make business decisions. That was the time personal computers (PCs) had entered the market and I had a few associates who had developed financial accounting software for use by small and medium businesses. (How I got to know them and built up a business around the use of PCs for small and medium business is a separate chapter in my life.) I suggested that they should use PCs to achieve their purpose. At Mr Sanghanis' request, I undertook to build a good management information system in association with one of these software developers. Thus started my association with Mr Sanghani and his sons. 

A few months after completing the first project, Mr Sanghani called me asking if I could help his third son to put together a project report for his business idea, and also some other ideas he had which were unrelated to his current businesses. Thus I kept getting work from him at regular intervals. 

A few years later, when he had decided to step down from all his current businesses and hand over the day-to-day operations of all the businesses to his four sons, Mr Sanghani asked me to be available when the sons met, to guide them how to run their businesses the corporate way instead of like a typical family-run business. During my first meeting, I noticed that the four sons were pulling each other in different directions to run all their businesses. I ended up giving them some gyaan on how they should look at their roles as financial stakeholders of all their businesses and have each one of them manage one business of his interest and be fully accountable to the stakeholders. Each one of them would be paid for his job as a CEO for his business according to the market salary that they would have paid a professional if employed, and all of them would get a share of the profit from each business in the form of dividends and support each other where needed to ensure all the businesses were run successfully. They liked the idea and decided to follow my advice. 

I moved on from there to other assignments and was later told by one of the sons that they had implemented my suggestion totally and it was working well. Today Unicorn Industries has grown to become a large business house with interests in many other areas and the four brothers are still managing it the way I had advised and remain united. Recently I found similar advice being given to large family owned companies by many consultants. 

In the meanwhile, Mr Sanghani had become very close to me on a personal level. He started an NGO to promote education-related activities and travelled extensively. In order to fund the NGO, he started another new business involving export of floriculture products, using the profits from this business to support the NGO. He was good at networking and connected with educationists all over India and abroad to share his ideas and take their help where possible. He got me associated with his NGO in the early stages for formulating his ideas into a report which he could use and kept calling me for guidance when he needed it.

Apart from this, Mr Sanghani also arranged for me to address his business community which, as he put it, was languishing due to their shopkeeper mentality. He wanted me to expose them to technological and other changes which required them to change and adopt. This exposed me to the traditional business community who never thought an outsider like me could be of any help. But soon after my round of addresses, I started getting requests from some of those businessmen to help them grow. 

One day, Mr Sanghani shared his thoughts on why he was focusing on education so much, when he himself came from a community which valued making money through business more. His view was that money is chanchal and could not stay at one place all the time but education is solid as a rock. Once you acquire it, it will remain with you. That is why he had more respect for educated people and made sure his sons, unlike him, got properly educated. This, he said, was the reason why he valued my association all these years. I was very humbled by his words and kept wondering where he would have been if he was educated. He had grown fond of the South Indian snacks and South Indian coffee that my wife prepared, and would drop in to my home once in a way for breakfast specifically for this. He continued to stay in touch with me even though I had stopped working with small and medium businesses post 1993, until he passed away in the early 2000s.

Both Mr Raju and Mr Sanghani were instrumental in helping me believe that I was on the right path in my approach to work and helped me to mentally sustain my faith through bad as well as good times. And they were both amazing entrepreneurs coming from different backgrounds but left behind solid institutions. I met Mr Raju’s nephew a few years after he passed away and he insisted I visit his factory which he had grown to new heights and sent his car to pick me up. He said I had helped establish a base on which he could build his business and it had become a global supplier of high-tech instrumentation. 

Similarly, I later met one of Mr Sanghani’s sons who told me that the project for which I had helped prepare the report had been sold to a global conglomerate for a huge sum and he was now in charge of managing the family finances in the manner I had advised them so many years earlier!!

In my next post, I shall share my encounter around 1984 with a self-taught computer professional in an assignment referred by a bank, and how we together built up a business around getting small businesses to use PCs as important tools to run their businesses.