The strong growth of Construction and Heavy Equipment (C&HE) sector worldwide and especially in India demands innovation led engineering & design and channelizing of engineering talent to the sector. Samir Yajnik, President Sales & COO, Tata Technologies – AsiaPacific and Chairperson, NASSCOM SIG – C&HE (Construction and Heavy Equipment) spoke to TrafficInfraTech about the need for filling the gap between the requirement of C&HE sector and the available engineering resource and talent in the country.
Along with automotive and aerospace industries, the construction and heavy machinery industry forms the core of Tata Technologies’ business. Over the years, with your global presence, you have been able to deliver innovative and differentiated solutions to your clients…
For us, engineering in product development is in the epicentre of what we do for our customers. We got heavily involved with the NANO, right since the early stages. We put this whole project as frugal engineering and put it under TATA innovations value framework. When we took this project story to North America, we got spectacular responses from construction &heavy engineering in North America appreciating our application of frugal innovation to Nano. They were keen on learning this technique to blend it in their products to develop themselves in Asian and other markets. We started our engagements with tear-down benchmarking and value engineering. We went through systematically helping them not only in the Indian market but also in Chinese market; tearing down the product and understanding how they can de-content and re-design their certain sub systems which would help in reducing their costs. We help them in making relevant product at reduced costs. That’s a process of taking knowledge from one industry and re-applying it to the construction and heavy engineering. Now we help them with designing, developing, certifying and testing. That’s one example of our innovation.
Last year, we acquired Cambric Corporation which is an American-Romanian company primarily in the construction and heavy engineering space. It is an engineering services company that has been involved in full cycle development of a number of high-end construction projects mostly serving the Western companies. We wanted to fill the gap of competency in the construction & heavy engineering space to enable us to deliver from concept to product realization. This happened as a part of our strategic plan to deliver end to end solutions including engines and Cambric is very much involved in Tier IV, testing, certification, and design. As an example, this has allowed us to partner with an OEM in the specialty truck market in America to completely modify their systems and structures to incorporate an alternative fuel option.
What are the steps NASSCOM SIG is taking to improve ER &D in C & HE sector? What are the challenges?
According to a study by Zinnov Management Consulting, the Indian C&HE Industry revenue is set to grow six-fold to $23 billion by 2020. Therefore, we have a four-five dimensioned focus. We have wealth of engineering talent but what are we going to do to create interest among the engineers for construction equipment? We have identified some colleges which are going to build and teach these courses and also give operator level training. So skill is one dimension, and then other dimensions are innovation and technology.
There is a need for concerted efforts to understand whether these things are relevant for the Indian Industry. We are trying to get data and work towards removing inhibitors and put some accelerators for the industry.
What is Tata Technology’s role in C&HE sector?
There is a need for indigenous ideas and innovation; in fact, we can innovate and sell our engineering products to global market in
construction and engineering space. And that is our vision. We are closer to $440 billion this year; the rate at which we are growing aggressively, we may positively reach at $700 billion with some acquisitions mostly from the competency building point of view. We have 7000 plus engineers.
The technology which we have will be used by the infrastructure companies especially those in heavy engineering space who develop the
construction machinery. We zeroed on not only in demand side butalso as an activist in the NASSCOM’s engineering council and we look at the supply side as well. Being an engineering council member, we have worked on the deployable skill issue. The, engineers who come out of the colleges do not have deployable skills, and hence, the companies are spending one or two years training them on the job. So, one and half years back we started working together and we have completed three levels of intervention. We have developed special courses for engineers which will teach them about integrated product development. We will be also conducting vertical courses on construction equipment, automotive and aerospace within the curriculum to teach them vertical industry specific knowledge. And we also provide them job specific training. So working within the Sector Skill Council of NSDC for IT and ITES, we are looking at all these three areas and based on that, we are thinking of building the curriculum. Already 600 colleges have adopted it; we are now looking at vertical industry courses and also job specific training. We do not have any specific role based training institutions yet.
Tata Technologies is first to start the ESO business…
Early mid-nineties, after my brief stint in the US, I returned to India and was looking to build Engineering consulting in India. But due to customs duties restrictions to get software into the country, I set up a company in Singapore, and that time the country wanted to be a ‘Smart Island’ and the government were given grants to build knowledge based organization. At Singapore, I got introduced to the Tata group and in India, Tata Motors was trying to build know-how of making vehicles faster through knowledge based engineering. Tata group at that time was envisioning a technology organization that could serve the world and build two-way knowledge highway with India in the application of technology in the space of product development. A team of people who were serving at the Tata Motors moved over to Tata Technologies, and thus Tata Technologies was born. I joined Tata Technologies at the same time what is now known as ESO (Engineering Services Outsourcing). One of the first advanced Engineering Outsourcing Centre was opened in Hinjewadi in Pune.
The engineers ofthe management services department who come out of Tata Motors knew not only design engineering and manufacturing but they also knew how to,work with the supply chain; andthis was how the engineering services outsourcing
started.Along our growth journey we also acquired INCATin 2005 as wewanted to be closer to our customers in the Western countries
and in Japan. This acquisition was an interesting one because at that time we were half their size, but then we merged and became one of the world-class companies with multiple delivery centres across the globe. Warren Harris, our current CEO and Managing Director, was then the head of INCAT.
Now we have taken ESO to a different dimension. We look at how organizations apply engineering throughout the product development
process, we systematically study their processes and help them define what should be core to them and what can be outsourced, thereby helping them to responsibly utilize their in-house engineering resources and help them outsource the rest.When we are
looking at engineering outsourcing, we are not looking at only automotive. Our ambition is to partner with ambitious manufacturing companies to create better engineeredproducts in the transportation and industrial sector over all. Our forte is to createmoving machines that are better to the purpose they serve. Better products benefit people and that is our business.Our vision is to become leader in the ESO space. Today, if you look at the $17 billion business, only $7billion is ESO and the rest in captive.We aim at becoming million dollar business by 2017. And the growth rate is forecasted at $ 30-32 billion industry by 2020.
We moved from automotive to aerospace, because some of the technologies that we apply are very applicable to this industry.In fact the KBE that was started in Singapore, we learnt early from lessons from aircraft and Boeingand not from automotive. In fact, our KBE initiated in Singapore was a result of the lessons we learnt from aircraft and Boeing and not the ones we learnt from automotive. So it was very obvious, we apply that to both the industries.When you look at the Indian and some of the developing worldcontext, the infrastructure and construction equipment growth is going to be much faster than the engineering applications. However, the industry does not have right operators or engineers and the understanding of the market is not well enough. And there is not much innovation, so we import.