Mr. Vimal KejriwalManaging Director & CEO, KEC International Limited
Mr. Vimal Kejriwal is the Managing Director & CEO and a Member of the Board of KEC International Limited. Additionally, he serves as a Director on Board of SAE Towers Holdings LLC, USA, a wholly owned subsidiary of KEC International Ltd.
With around 33 years of rich & diversified corporate experience, he has significantly contributed in turning around KEC into a highly profitable company. He has also been instrumental in successfully bolstering the company’s international exposure. Under his initiative and direction, apart from entering 19 new countries, KEC also acquired SAE Towers headquartered in USA having factories in Brazil and Mexico. With this acquisition, KEC became the largest globally operated tower manufacturing company in the world. In KEC, consistently for the past three years he has been lauded and recognized with the “Outstanding Achiever Award”, one of the most prestigious RPG Group Annual Awards, for his outstanding performance and commitment towards KEC.
Mr. Kejriwal is also very active on the industry front, presently, he is the Chairman of Transmission Line Division of CII. In addition, he is the Executive Committee Member of the Afghanistan-India Chamber of Commerce and Industry (AICCI) jointly set up by the Federation of Indian Chambers of Commerce & Industry (FICCI) and the Afghanistan Chamber of Commerce & Industries (ACCI) as well as a Member of the CII Manufacturing Council 2015-16. Formerly, he was the Chairman of the International Business Division of Indian Electrical and Electronics Manufacturers’ Association (IEEMA).
Mr. Kejriwal is a distinguished alumnus of the Kellogg School of Management, USA and NarseeMonjee Institute of Management Studies (NMIMS), India. He is also a meritorious Chartered Accountant and a Member of The Institute of Company Secretaries of India.
1. What was the mandate given to you by the Board when you took over in your role?
My primary mandate when I took over as MD & CEO in April 2015 was to turnaround the Infrastructure Business and improve the margin levels on sustainable basis relative to our competitors.
Augmenting and strengthening our core capabilities was the next priority. Simultaneously, it was important to modernise our work place culture to inculcate a more open work culture and make it more contemporary especially for our younger emplpyees.
2. How much of that has been achieved? What were the challenges faced?
A significant part of the mandate has been achieved in the short span of 15 months in the face of challenging global headwinds.
We have consistently delivered an improvement in our margins over the last few successive quarters since April 2015. Our EBITDA margin for FY16 increased by 200 bps at 8% as against 6% in FY15.Our Market Cap which presently stands at Rs. 3500+ crore has increased by around 1.7x since the beginning of FY15.
SAE Towers, our 100% subsidiary in the Americas has also witnessed a turnaround.We significantly scaled operations in the Substation arena including gas insulated substations. Our present substation projects panorama includes over 22 substations in India and around 45 substations at various international locations including MENA, SAARC, Africa and East Asia Pacific.
In our pursuit to remain global leaders, we successfully completed an organization wide transformation exercise which further strengthened our project management and execution capabilities thereby resulting in accelerated delivery of almost 7 T&D projects ahead of its scheduled completion time as well as earning acceleration bonuses in some global projects.
On Infrastructure business front, our Railways Business is on an accelerated growth track and the Solar EPC Business is also poised for a higher growth trajectory. We have significantly build our capabilities and are gradually expanding and spreading our wings in both these businesses. We have secured some significant orders in the Railways space as well as ramped up our Solar business by almost 10x in FY16 relative to FY15.
We embarked on numerous initiatives to transform KEC into a contemporary and an open work place with a global mind-setincluding revamping of our office premises which now reflects a more open and vibrant work culture. We introduced flexi timings towards achieving better work life balance. We have initiated the practice of addressing every one by their first name basis irrespective of their designation as well as refined, improved and moved numerous HR practices like goal setting, performance appraisals onto the digital platforms.
Some of the challenges which we faced during the last few quarters included a general slowdown in the global market, increased competition, general slow down in the availability of credit.
3. What are the key challenges your organization is facing currently?
We have a footprint in 61+ countries and are presently executing projects in 33+ countries. Global volatility and uncertainty are major challenges especially in our case since more than 50% of our revenues come from overseas market. For example, the declining of oil prices in the Middle East was a challenge which we are overcoming by spreading and diversifying geographically.
Also considering the nature of our business which involves constructing transmission lines traversing national boundaries, we encounter numerous on ground physical challenges like executing projects in difficult terrains, extreme climatic and hostile conditions etc.
At KEC we perceive challenges as opportunities which inspire us to go deeper into the realms of our internal strengths. With around 7 decades of experience and proven credentials, we swiftly and tactfully manage challenges related to manpower, geopolitical instabilities, commodity pricing risks, execution related problems like difficult terrains and extreme climatic conditions as well as industry vide issues like Right of Way, forest clearances etc.
To elaborate a bit on manpower front, improving capabilities and hiring the right kind of manpower is a must for our kind of job. We have a diversified workforce of 5600 people comprising of 20% Non-Indians. Effectively managing such a diversified workforce is a challenge in itself which we are not only successfully managing but are also an employer of choice and a name to reckon with globally.
4. What are the key challenges for the sector?
The sector is engulfed with myriad challenges. Many projects are still getting delayed due to operational issues like Right of Way (RoW), forest clearances, delays in getting approvals for railway crossings, highway, power crossings etc. These not only burden the contractor in terms of time overruns but also embed an element of additional cost, which mars the contractor’s enthusiasm. Besides, EPC contractors also encounter contractual challenges like delay in closure of contracts, no proper redressal mechanisms etc.
Globally, the sector faces challenges on account of economic volatility due to which certain markets may not grow as expected, however as mentioned earlier, we try and neutralise the impact of these against our diversified geographic spread.
5. What is your talent strategy? How do you draw the balance between home grown vs lateral hiring at the leadership level?
We are a flagship company of the USD 4 billion RPG Enterprises. Our talent strategy is based on RPG’s new vision statement ‘Unleash Talent, Touch Lives, Out Perform and Be happy. At KEC, we focus on internal talent growth through our various people initiatives including KEC TalentFirst! where we give priority to KEC employees to fill in the vacancies followed by RPG employees via Grow@RPG before we open them to the external world.
We have a structured approach towards mentoring and nurturing Graduate Management Resources (GMRs) who are direct campus recruits from Top Ranking Management and Engineering Institutions and professional institutions like the CA Institure, this program assists the Group in transforming the GMRs into leaders of tomorrow.
While we focus on internal growth, we also bring in lateral talent with varied experiences and perspectives within and across industries. We emphasize on nurturing Lateral hire right from the beginning by having a Development action plan for them soon after their joining, offering cross functional & Global exposure to enhance their knowledge of the business. Our aim is to create an environment that enables people to unleash their entrepreneurial spirit and realise their full potential by providing an open work environment with an innovative culture where people collaborate and deliver results.
In fact some of our graduate engineering trainees have grown significantly and our now heads of large Business segements in KEC.
6. How does your organization identify and develop future leaders?
At KEC, we use a robust approach to identify high-potential employees & groom future leaders.
We follow a robust Performance Management system (PRIDE) where every employee is given an opportunity for job rotation/job enlargement/growth every year ensuring he/she gets the maximum out of any role they handle while preparing them to handle larger roles. Employees are provided an opportunity to share their career aspirations during their performance discussions with managers. Also, managers recommend career changes for their team not just in KEC but also across the RPG Group.
A potential assessment is done for all the high performing employees as part of our Talent Management process called Organisation Management Review (OMR). We follow the 9-box model where every individual is plotted based on their performance and potential.
A Career path for every individual is designed based on their performance, potential as well as their career aspirations/recommendations. Development Action Plans (DAP) for every individual is defined to enable the individual to follow their customized career path and grow up the value chain. In addition, frequent team reviews apart from the mid-year and annual review help the employees as well as the organization to keep the pace in order to achieve the set annual goals.
7. In a world full of volatility, Uncertainty, complexity and Ambiguity (VUCA) and also being closely involved with government, what is your strategy to manage various stakeholders to get the desired outcome?
Our industry is rapidly transforming, has become more competitive and client expectations are also undergoing a rapid change. In such a scenario, a strong value proposition is a must for long term stakeholder value creation. Towards this, continuous differentiation and constant value addition is what I would say is our USP which helps us in managing all our stakeholders.In fact I would like to mention here that on account of our robust credentials and excellent project management capabilities combined with adherence to financial discipline, we were one amongst the few companies in the EPC space to have maintained its growth levels during the current lean phase experienced by the entire infrastructure industry. We also have a robust risk identification and management system, which helps us to continuously identify and mitigate various risks.
We have adopted a focused growth strategy based on de-risking the business through geographical expansion, diversification of our business portfolio as well as taking the inorganic growth route whenever required. To add to this our industry fundamentals are very strong, our engineering, design and execution capabilities are excellent and vendor relationships are very well maintained and nurtured. We have also created a distinct culture revolving around the pillars of Delivery Focus, Cost and Profitability, Ownership & Accountability, Cross-functional team, and others which ensured that every aspect our business operations was deployed around these pillars. In addition to leveraging our core competencies and strengths, we continuously raise our benchmark and strive towards enhanced levels of excellence. Recently, we underwent an organization wide transformation exercise aimed at further enhancing our project management and execution capabilities thereby resulting in accelerated delivery of almost 7 T&D projects ahead of its scheduled completion time. We understand that it is necessary to re-invent and innovate in order to maintain as well as enhance our success levels.
8. How do you define and practice leadership?
First and foremost it is important for a leader to acknowledge the fact that it takes a team to build a successful venture and in today’s global scenario, a leader has to manage distributed teams across different cultures. The word team connotes, transparency, trust and being approachable at all levels. This is the basic essence of a team which a leader has to adhere to.
Decision making is a critical element while practicing leadership as it is imperative that the leader takes ‘The Right Decision at the Right Time’. At any given point of time we have >100 projects under execution across the globe which mandates us to take speedy decisions bridging the time and geographic differences for which we have a robust system in place.
Then comes the aspect of leading which transcends beyond ‘Taking the right decisions at the right time’ to being prepared for the consequences as well as chalking out alternate courses of action in the event of a non-favourable outcome.
It is extremely vitalfor a leader to exactly know where the organization is; what level he intends to take the organization to and how i.e.what course of action he is going to take inorder to achieve this.
And finally, one mantra I’ve constantly followed through in my personal life & career is hard work & hard work – it’s the only way you can achieve anything.
9. How Indian leaders can become Global Leaders?
Business Houses in India are already competing and expanding rapidly on the global arena. KEC for example has more than 50% of its revenues from overseas market.
In my view we don’t require special skills to become global leaders. If you are leading in India which in itself is a heterogeneous land with multiple States, multitude of cultures and varied challenges, you are exposed to such diversities and learnings that you become capable and empowered to lead anywhere else in the world. Besides, Indians have an astute business sense and are inherently capable of blending and sustaining amongst diverse cultural trends apart from their ability to easily imbibe change. Today you will not find any place where Indians are not there, Indians are present everywhere and they are a very successful clan too.
10. What are the 3 most pivotal moments in your career that you either learned from and/or that got you where you are today?
I started my career with an American pharmaceutical MNC. It had only been four years, and I soon begun to feel very complacent and largely unchallenged in my role there. Deciding to shift gears, I joined a large Indian business house that was on a sharp growth path, where finding new projects on a daily basis to grow was a challenge. Being put in such a dynamic situation so early in life, definitely helped shape the path my career was to take.
The second turning point according to me was when I joined KEC in 2002 as its CFO. The company was at that point of time going through a deep crisis; we were hugely cash strapped, revenue and profitability were an issue, on time delivery of pay checks was a concern etc. I believe, the challenge to turnaround this situation, readied me for my further elevation in the Company.
The third and the most pivotal role was when I took on the responsibility of managing the international business for KEC which was very different from the role of a CFO. My mandate then, was to significantly improve and expand our presence in the International arena which I successfully accomplished. During this period KEC’s T&D business achieved a remarkable 14 fold increase in revenues apart from entering 19 new countries and today >50% of KEC’s revenue comes from International Markets. The change of role from just being a finance leader to a business leader was a pivotal step in my career, this eventually has led to my taking over as CEO of the entire business in KEC.
11. What message would you like to share with young professionals at the start of their career?
My message to the millennial generation is to ‘Never give up’ as I say ‘nothing is impossible’ and there are no short cuts to hard work.
My second advice would be to never become complacent; you have to constantly challenge yourself and raise your benchmark levels. Like, while you are running on the treadmill, it is important that you continuously increase your pace and push yourself to accomplish more. The day you decide to run without challenging yourself more, you will be left behind in this competitive world.