An escalator to 'eighth heaven'

LUNCH WITH BS/M S Ramachandran, Chairman, IOC

Management trainees at the Indian Oil Corporation (IOC) call it the "eighth heaven" "" a reference to the eighth floor of the company's sprawling headquarters in Delhi.

This is where the top management sits. "It must be one of the most long-lasting jokes at IOC. As management trainees in 1969, we also used to call it that," says IOC Chairman M S Ramachandran (MSR).

But, in 2002, when he got the opportunity to occupy the corner office in the eighth heaven, the "power and prestige" of steering India's only Fortune 500 company was a great humbling experience.

All the hard work on his journey from a management trainee to the chairman's office in the same company suddenly became part of history: work, for him, had only just begun. "I realised one has to work hard even in heaven," MSR quips.

We are at the Delhi Oberoi's exclusive Belvedere Club, which MSR chose not because of the food (the options are limited, he says) but its quiet ambience that allows you to talk at leisure.

He quickly orders a vegetarian thali, but changes his mind even faster when the steward tells him that lauki ki sabji and baingan ka bharta are the main delicacies of the day.

I order a "kebab special" and MSR follows suit "" vegetarian, in his case. Now that the "critical decision" has been taken, he goes back to his favourite topic "" the power and prestige of a public sector job.

He had the first taste of it in the early 1970s. MSR was all of 25 when he was asked to oversee IOC's supply and distribution operations in Mumbai "" a relatively routine assignment now, but a formidable responsibility in the quota regime.

"There was always a huge queue of senior state government officials in front of my cabin," he says, with boyish enthusiasm.

The power and prestige of the job had another spin-off effect: his ration card was delivered to his office the same day he casually told a senior state government official about the huge delay in the processing of his application.

"The best part about public sector jobs is that people are generous in allowing you to take on their workload. For a person who is willing to learn, it can be a great opportunity to get noticed by the top management," he says.

That's perhaps why MSR didn't have to take the stairs to reach the eighth heaven; the escalator was always ready to put him on the fast track.

If he became the supply and distribution chief at 25, the beginning of the journey was even more spectacular.

A mechanical engineer from the College of Engineering, Guindy, in Chennai, he was one of the seven management trainees to join IOC under a special recruitment drive.

All of them were promoted to Grade B within two years (it usually took 10 years for a promotion from Grade A to B). Predictably, IOC had to disband its scheme for taking management trainees within a year in the face of strong protests from officers' associations.

Four of this "special" batch are now heading India's top four public sector firms "" IOC, Oil and Natural Gas Corporation (ONGC), Gail and Shipping Corporation. The fifth is the celebrated management guru, Sumantra Ghoshal. The other two left IOC after getting meaty assignments abroad.

The kebabs are nothing to write home about and MSR seems more interested in taking deep sips from the large glass of lassi that he had thoughtfully ordered. Despite his spectacular growth at IOC, MSR says, he never had to lobby for anything "" another reason why he didn't think about leaving IOC at any stage in his career.

Sensing that I wasn't too convinced, he proceeds to give an example. He had consistently been turning down the government's offer to post him in Delhi as executive director of the oil coordination committee on the ground that his daughter was studying in Mumbai and he would rather spend time with her than stay alone in the capital.

"I knew my daughter would go away to the US for further studies [both his children "" a son and a daughter "" are now working in the US] and didn't want to shift base at that stage," he says.

But the then petroleum secretary Prabir Sengupta was insistent and even offered to "keep the seat empty" until he finally made up his mind. After numerous phone calls from Sengupta, he took up the offer as he "felt wanted".

The decision was worth it. The executive director's job at the oil coordination committee was hugely important during the critical phase of deregulation and dismantling of the "administering pricing mechanism".

"It was a hot seat. So many people had faded away into oblivion after a stint there, but there were several others who rose to greater heights. I took inspiration from them and survived," he says.

That's obviously an understatement. For, MSR was inducted into the IOC board in 2001 and became chairman the next year.

We order coffee "" the best part of the lunch, I thought "" and MSR talks animatedly about IOC's stupendous performance: the company moved up 35 notches in a year to rank 191 in the 2003 Fortune 500 list and posted a turnover of Rs 1,19,848 crore in that year.

IOC meets almost half of the country's petroleum needs; its 10 petroleum refineries process 35.3 million tonnes of crude; and the 11,000-odd retail outlets sell 46.46 million tonnes of fuel.

It also broke into the top five league in market capitalisation last year and is now placed at number three after ONGC and Reliance Industries.

The biggest challenge was to make the entire organisation take marketing as a religion, for which a competitive and cultural transformation was required.

It's no surprise that one of MSR's all-time favourite books is Who says Elephants Can't Dance? by IBM's former chief Lou Gerstener, Jr, who scripted one of history's most dramatic corporate turnarounds.

IBM was one company that had been at the pinnacle of an industry, fallen to near collapse, and then, beyond anyone's expectations, returned to set the agenda.

"IOC hasn't faced anything like what IBM did but I drew a lot of inspiration from Gerstener," he says.

Despite the success, MSR thinks the mindset of IOC employees still needs to change. For example, the company wanted to redesign its petrol stations and the chairman wanted a world-class designer.

His colleagues, however, went for tendering "" a sad legacy of the past. This "tendering" mentality is something he wants to change, which explains the huge HR drive for competency mapping, performance-linked incentives and fast-track promotions.

MSR is clearly in the mood to talk more about his company's "fascinating transformation".

He refers to IOC's huge globalisation drive: its hugely successful entry into Mauritius and Lanka (where the company already has 170 petrol outlets).

Lankan Prime Minister Ranil Wickremesinghe, whom he met at an official function, recently, told him "MSR, you seem to have changed the landscape of Colombo."

The Lankan PM was referring to an IOC petrol station, which was razed to the ground and built anew. The station, which is just opposite the PM's official residence in Colombo, now sells 1,100-kilo litre of petrol a day "" much more than any IOC petrol station even in India. Bangladesh, Indonesia, Afghanistan are the other countries IOC is planning to enter.

Pakistan is another country into which he would like to venture. When some industry representatives from Pakistan requested him to explore possibilities of an IOC entry into their country, MSR told them his response would be similar to what the Tower of London told the Leaning Tower of Pisa: if you have the inclination, I have the time.

The IOC chief looks mighty pleased recounting the hearty laugh his comment evoked among the Pakistani team members, and orders a second round of coffee. He insists that he isn't a workaholic and works for "only 9.30 to 8, six days a week."

Relaxation means 50 minutes of jogging every morning and listening to Hindustani and Carnatic classical music.

Swami Vivekananda is a role model and an inspiration. "There is just no time for anything else," he says. He doesn't even remember when he last saw a movie.

What are his plans after retirement? "It's a year away and there is still a lot of work left in the eighth heaven," MSR says with a glint in his eye, as his Mitsubishi Lancer waits in The Oberoi's portico.