The Murugappa Group was founded by Subbiahs grandfather AM Murugappa Chettiar in 1934. The group was a pioneer in many ways, such as setting up the first cycle factory in the country. Subbiah entered the business 43 years ago. By the late 60s, things were beginning to slow down, and problems started surfacing. He emerged as a tough leader who could turn around ailing units. In the late 60s, he put group company Corborundum Universal back on the tracks. In the 70s, TI Cycles was beginning to lose out to competition from the West and the North, and was facing a lot of labour troubles that led to a ten-month lockout. Subbiah took a tough stand, was not averse to making unpopular decisions, and finally got labour to agree to wages linked to productivity. His biggest challenge, however, was in turning around EID Parry, a 200-year-old British company that looked as though it was in its final days when the group took it over in 1981. He lived up to his reputation, cut costs, staff, made Parry operations profitable and integrated it with the group by 1987.
As the CEO of the group, Subbiah helped it become a well-structured, modern, forward-looking organisation. Today Murugappa Groups turnover exceeds $4 billion. He retired as the chairman of the group in 2004. I have not thought of business ever since, he tells me. But there are many other things he is preoccupied with. In 2009, GoI asked him to take over as chairman of the newly-formed NSDC with public and private sector participation. The NSDC has been given the mandate to skill 150 million youth in India. It is a joint venture between the government and industrial associations for developing skilled workers and is expected to play a nodal role in the project. Industry bodies such as CII, FICCI and CITI are stakeholders who have put forward proposals to open new skill development centres.
We meet for lunch at Southern Spice, Taj Coramandel Chennais refurbished and redesigned South Indian speciality restaurant. The place resembles the palace of a Southern king, with walls and ceilings covered with murals representing the four Southern states. The menu is vast, intimidating and exotic. We start with pepper rasam and a platter of starters (which the waiter insists we taste) like Denji Rawa Fry (semolina-crusted soft shell crab), Kozhikodan Chemeen Fry (prawns tossed with dried shrimp powder and coriander) and Scallops Sukka (scallops tossed dry with bedki chilly and shredded coconut), Vazhapoo Aamavadai (crisp gallettes of banana blossom and lentils), Milagu Adai (bite-sized, pan-fried lentil pancakes enjoyed with ginger relish) and Injipuli Koshambri (tempered moong bean with mesclun and ginger-tamarind yoghurt quenelle).
I ask him what he has been doing since stepping down from the family business. I am trying to read up on my own countrys history and culture and what the family culture was. I am, of course, looking at skills. Why are we so lacking in skills He gives me his take on the majestic Brihadeeswara temple in Thanjavur, which was built 1,000 years ago. How did the Chola king Rajaraja do it The temple was built on fertile land with not a stone in sight. Where did the granite come from How was it brought to Thanjavur So many people, artisans, craftsmen, sculptors and metalworkers as well as animals like horses and elephants (to move stones) must have come together. I think its the only time India as a country had a clear strategy. The king possibly wanted to build an army. He did that over the next 14 years, when he went to Orissa, crossed the seas and conquered Siam.
Subbiah connects it all to skill development. This was a wealthy kingdom which was the granary of the South. The Chola king got together people with skill sets, paid them well, treated them well and let them train others. Skills were also passed on from father to son. Subbiah is disillusioned with the Western education system that we have followed from the British times . He is convinced that we must go back to our roots and adopt the Gurukul teaching and learning process at the school level and the German vocational model for higher education. The Gurukul system basically promotes a holistic personality growth process by involving all the motor sensory activities, both physical and mental. The German model should be adopted after completion of schooling whereby students are free to choose a vocational course that interests them. This helps the students to excel in the field they pursue. Any person who spends at least 10,000 hours pursuing his or her passion will become an expert. We need to create many such experts, he says. The major achievement of NSDC has been in getting a ten-year-plan and the processes of creating a sustainable skill development ecosystem in place. The Corporation has been undertaking skill gap studies, finding funding partners, creating skill councils, getting loans and training the trainer organisation.
The waiters are hovering around us and it is time to order the main course. We both decide to have Bisi Bele Bath with asparagus Paruppu Usili and Scallop Pepper Stew . I ask Subbiah about his involvement in the family business. After his retirement, he went on a sabbatical for a year to the Centre for Family Enterprises at Kellogg Business School. Family management is a concept which is poorly understood, he says. He talks to two or three family businesses a year. They say families disintegrate after the third generation, say after 60 years. Do professional companies last more than that When families get confused, succumb to greed, play the stock market, get involved with PEs, they get into trouble. You have to have proper value systems for the family and governance for business.
We then check out the strange-sounding pepper and cardamom ice cream, which is quite delicious. Over authentic filter coffee, he tells me that if you do not have good governance, people will walk away. As we are leaving, he says, You know it was possible to turn around Parry because I was willing to sit and listen to people, our farmers, managers and workers. And whatever I said, I delivered.