Harsh Goenka talks about his happy Hindu Undivided Family and passion for being a journalist.
The partition of the family-owned assets includes Goenka Niwas, the family home in Kolkata’s upscale Alipore area, which will now be owned by Sanjiv and father Rama Prasad.
But just 10 days after that announcement, the elder brother, who is well known for his eclectic collection of art, is at pains to paint a perfect picture of a big Hindu Undivided Family. “Sanju’s children lovingly call me papa, the ladies in the family share a beautiful relationship and one of our most cherished moments are the annual family holidays. What more can one wish for?” Goenka, 54, says, as we settle down at the Chill Zone, a meeting-cum-recreation centre in the basement of RPG House.
But for all his effusion about the unity despite the division of the family assets, Goenka is unwilling to dwell on it. Instead, he wants to talk about the Zone, his “latest baby”. But I nudge him towards the topic that everyone wants to know more about. Isn’t he disappointed with the family division?
The answer is ready: Yes, it was extremely painful on an emotional level because both the brothers didn’t want it to happen even though the father had been advising them to do so for the sake of the next generation. “One day, he just made it a fait accompli. We couldn’t stop it,” Goenka says, adding that the brothers were perhaps blind to something that the father could see.
I try once more. He must be hurt by his brother’s comments, after the birth of the RP-Sanjiv Goenka Group, that he didn’t find it necessary to consult his elder brother on the new name. Goenka ignores the bait and says he was kept in the loop for everything except the logo of the new entity. “Frankly, he need not have consulted me on the logo. There are enough advisors for that,” he says.
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The steward knows the boss’ choice and serves Asparagus soup, water chestnut and Tzatziki – a Greek salad – at lightning speed. The food, I am told, has come from the boss’ home.
The RPG chairman, who spends most of his time in shaping the group’s HR practices, seizes the opportunity to go back to his favourite topic — the Chill Zone. The area, he says proudly, is also the venue for informal meetings that have yielded some of the group’s most innovative ideas. “It’s a fun place and half your job is done if your workplace allows you to let your hair down for some time,” Goenka says.
So a punching bag and a dartboard find pride of place in the Chill Zone and Goenka jokes that he actively advises RPG employees to use them liberally (“they can imagine my picture pasted on them”). Then there is a music station, a video-games section, a mini library and a pool table that employees can use anytime — even during work hours.
The main course comprises Shahi khichdi (rice and vegetable mix) and Canneloni, and can easily beat any standard five-star fare. I notice Goenka looking indulgently at a group of 20-somethings who are busy trying their hand at the pool table oblivious of the chairman’s presence. Chill Zone is indeed living up to its name.
But life surely isn’t just fun and games for RPG employees. After the division of the empire in August last year (Sanjiv’s announcement was just a formal demarcation), Goenka has already put in place a 2x2x3 credo, which means doubling of sales and profits in the next three years. And this is applicable for all the group companies — Ceat, KEC, Zensar, RPG Life Sciences, RPG Raychem and Spencer’s Travels. Besides, there is Harrisons Malayalam that has been vertically divided between the two brothers.
After the separation of ownership and management, Goenka has also put in place the concept of Centres of Excellence — which essentially pool in group resources and knowledge that can be shared across the group. Often experts from outside are roped in for this.
And he claims these efforts are already yielding results. The turnover of his share of companies was Rs 12,500 crore in FY11. He expects that to touch Rs 16,000 crore in FY12 (the results of group companies are yet to be announced).
For example, Goenka is placing his bets on new plants as far as group flagship Ceat is concerned. The tyre maker will increase its manufacturing capacity to 800 tonne per day (tpd) by 2013 (the target year for Mission 2x2x3), compared to around 550 tpd now. The product mix is also being revamped to focus on the businesses it has identified as high-margin — two-wheelers and passenger cars.
Acquisitions, especially abroad, are also on the radar. Since August, the group has acquired three companies and forged several alliances and tie-ups. Goenka says everything will fall in place once RPG becomes a destination of choice for talented people and his effort is towards achieving that.
Corporate social responsibility (CSR) is another priority area that will be made a core activity and form part of his managers’ key responsibility area. In what could be music to the finance minister’s ears, Goenka wants the government to impose a two per cent CSR cess on India Inc. His group companies earmarked one per cent of their profits (“most have not spent even that,” he says ruefully) on CSR last year and this has been increased to two per cent this year.
As the dessert – sugar-free Firni – arrives, I ask for his comments on the belief that India’s family-owned businesses, including RPG, have created a barrier for talent by having a virtual glass ceiling for outsiders. For instance, his son, Anant, 29, has taken the escalator to the Ceat deputy managing director’s cabin and the buzz is he will take over as the MD once the incumbent, Paresh Choudhary, retires next year.
Goenka dismisses any suggestion that Anant’s elevation to the MD’s post is a foregone conclusion and says he has to work harder and first prove his mettle to the board: “I won’t deny that the Goenka surname gives him an edge, but that’s certainly not enough.”
In contrast, Goenka says he had a far easier run and was made Ceat’s MD at age 24, soon after graduation and two years of training at a group-owned textile company (owned by uncle Jagdish Prasad). In fact, he had to grow a beard just to convince business partners that they are dealing with a person old enough for that post. His father was also quite lenient and would discourage his sons from working on Saturdays and Sundays.
But times have changed. So apart from good academic records from Ivy League schools, Anant had long working stints in Accenture, Morgan Stanley and Hindustan Unilever before joining the group. And as chairman, Goenka keeps a hawk’s eye on how the Ceat deputy managing director is shaping up.
At home, however, he at least tries to be as lenient as his father was. “After all, Anant has a 10-month-old daughter and needs to spend time with her on holidays,” Goenka says, asking for green tea while I settle for coffee.
If he hadn’t joined his father’s business, Goenka says he had three options: being a jhollawalah (he spent the first 22 years of his life in Kolkata), or an economist with socialist leanings (he studied economics at St Xavier’s College in Kolkata), or a journalist.
The last one was (and still is) closest to his heart — a reason he says he writes “well-researched” articles at least once a month. That’s also a reason he reads nine newspapers and 30 magazines. “That’s my passion. One day, I may ask you for a job,” Goenka jokes. Going by his networking skills evident from the juicy off-the-record stories about India’s most powerful people, editors certainly wouldn’t mind having him as a colleague.
So I ask him the obvious question about how the group’s media business (it has among other things a magazine called Open that made headlines for the recent phone tapping exposé) is doing. Goenka is keen to talk about it, but restrains himself “as the business now belongs to his brother.”
It’s clear that the members of this one big happy family are trying hard to learn to live with the new reality.