Last year, Debarati Sen joined the Indian operations of American multinational 3M as its Managing Director. In an interview with BusinessLine , she shares the company’s growth path, how the firm’s vendors and customers have navigated through demonetisation and what the future holds for them as the GST kicks in. Edited excerpts:
3M has a large vendor base and is closely involved with MSME and SMSE customers. What has been the impact of demonetisation on your company as well as your customers?
In spite of demonetisation, there has been an overall improvement for us and our channel partners, with 20-plus per cent improvement in our bottom-line and 10-plus per cent improvement in our top-line; we expect that to continue in future. Today, whichever corporation you talk to, there is more activism — people are seeing things getting better; no one sees it as perfect or even good. But the economy is definitely getting better. There is confidence in the current policy environment. This is a good time to be in India. We tend to be more successful when there is core domestic economy coming and thriving. This indirectly also impacts our industrial business. Our consumer business, which is the most visible part of our business, has grown very well and we expect it to continue on a solid growth path.
We are building an organisation that learns, quickly adapts, quickly shifts tracks and has the mentality to learnsmall things and scale up. We are really trying to build this atmosphere and culture where people learn very quickly and don’t get phased out when more, big destructions come their way. If there is anything I personally get involved in, it is the organisational response and how we understand, anticipate and quickly react. That is what is going to differentiate the winners from losers in India. There are lots that are going to come our way; we know it. We cannot sit and say it is business as usual. Nothing in India is business as usual right now. It is exciting. It is good stuff, right!
So how does a multinational like yours remain agile? How do you manage all those ever-changing situations?
I think the good thing with our company is that we have been in 200 countries for over 115 years — that brings domain adaptability. It is not domain knowledge, it is domain adaptability. I will just take an example: I have worked with 26 countries, lived in two countries and worked in three continents. So the expectation is that we should be adaptable and agile. And what 3M does around the world is, we build expertise in all areas. My job is to make complex things simple. Similarly, within the company, I do a lot of teaching. I even use the phrase ‘you need to be the GM of your business’. The health of the enterprise is very important for us. India is not very attentive to balance sheets. We have seen that for the lack of having access, large companies like us been brought down to the heels. A lack of attention to the financial hub, over-leverage position, does not help.
How has the stock performed vis-a-vis the Sensex, which has seen a steady climb?
During the last 12 months, our stocks hit the highest ever. We crossed 15,000 last July and went back and then back to 15,600 and whatever it is now. During the last five years, I think Sensex grew 11 per cent and we (3M) grew 26 per cent. We are not always driven by actual larger curves. People are really looking at fundamentals now. I think diversity is our biggest strength. So we are never going all the way up or all the way down because we’ve got so many different superset goals laid on each other. We tend to be the most steady stock.
How do you plan to navigate through the implementation of the GST?
We are training, coaching and teaching. But we are not our customers’ IT service providers or CA; so they have to do a lot of things on their own.
That aside, I am in the Karnataka State Council of CII (Confederation of Indian Industry). One of the key reasons we are on it is because I think it is our duty to bring along growth in the economy. We talked about it at the State Council meeting that we need to teach faster. I have multiple accounting and tax experts, which some of our customers might not have. So it has to be an industry work. We are handholding our vendors, SMEs and channel partners. This is a period of turmoil. It will be the survival of the fittest and some will probably not make it.