The Economic Times daily newspaper is available online now.

    India's potential is finally turning into results: Vishal Wanchoo, CEO, GE South Asia

    Synopsis

    GE was the pioneer of India’s back-office story. But it has fallen off the pedestal in the digital era.

    Interview
    In an interview with ET, GE India’s CEO Vishal Wanchoo shares a view from the inside.
    General Electric was once the ultimate icon of industrial-era capitalism. The $122-billion conglomerate set benchmarks for the corporate world. Many things made the 126-year-old GE special — its aggressive growth pursuit (where it had to be either no 1 or no 2 in the business or exit), its famed rankand-yank (bell curve) employee policy, its leadership development programmes and its emerging market bet, among others. In fact, GE was the pioneer of India’s back-office story that began in the 1990s. But GE has fallen off the pedestal in the digital era.

    In June, GE was removed from the 30-company Dow Jones Industrial Average. This was partly because of major shifts in the corporate landscape. Industrial-era biggies have been overshadowed by the rapid rise of digital giants like Google, Amazon, Facebook and Apple. At least partly, GE itself is responsible for its meltdown. Now, its new global chairman John Flannery (appointed June 2017) is undertaking a massive restructuring — including the sale and spin-offs of businesses — to get GE back in shape. Board and top management reshuffle, too, have happened. How do these shakeups at the Boston headquarters echo in India, which is among GE’s top five markets in key business verticals like aviation and power? In an interview with ET, GE India’s CEO Vishal Wanchoo shares a view from the inside. Edited excerpts:


    The corporate meltdown of GE is making headlines. It was booted out of the Dow in June. What’s the mood like in the office?
    Exiting Dow was not as big an event as the business announcements of GE in June, as it affected people at a personal level. What is important is that the company has moved on. It has been transparent. The year has been tough but also highly encouraging.

    There was a lot of anxiety about the pace at which things were unfolding. What has helped is John’s (Flannery, the chairman) transparency and constant communication, ranging from weekly podcasts to video two-way communication. He is trying to set the context and also the pace. There were lots of concerns and anxieties as to what’s going to happen. The big announcement he made on June 26th (about business restructuring) has helped.

    You hate to read everything that’s being written about GE. But it also reminds us that we are not that company. We make amazing technology. It also motivates us that we are going to come out on top.

    1


    Tell us about the massive shakeup at GE headquarters.
    We are going through a lot of changes. John is leading us. He wants the businesses to behave like listed entities. He wants businesses to be the centre of gravity, delegate authority and let them take decisions and be independent. In the past, many decisions were taken in conjunction with the corporate group. Now, John wants the corporate team to be very lean. So, corporate will look at macro decisions — like how much money to put into stock buyback, M&As, dividend payouts and allocation to each business. But business-specific decisions, like new investments or new products, will be delegated to businesses that can figure out the tradeoffs. Even simple things like levels of people to be hired will be left to them. With delegation of power, we also need to create more accountability for the businesses.

    2


    Earlier, the India CEO was a lot more engaged with businesses operationally. They will now operate independently. My role now is to help the business at a macro level, focus on culture, brand, people, customers and be the glue between businesses so that we can optimally exploit the synergies.

    graph-2
    Now that the business is being overhauled, what are the thrust areas?
    The focus will be on aviation, power and renewable energy. They have a lot of horizontal synergies. Some businesses like transportation, John felt, were constrained within GE. Now, they will thrive outside of GE, rather than inside. GE healthcare has been hived off and GE will not have the ownership in the long term. This gives us more freedom to do what we want to do and make investments. The new growth business would be digital and additive manufacturing. The focus will be to optimise our assets. Digital can help us in predicting unanticipated failures, help boost operational efficiency. We will look at more outcome-based contracts with our customers. We have just signed a big deal with Tata Power to manage their assets.

    Tell us about the old GE vs the new GE and the ensuing transition pain?
    GE’s foundation is built on a culture of integrity and innovation. One aspect that John has now injected is candour, transparency and debate; any employee can challenge a decision, raise his hands and say this is not right. This is not about being abusive but asking questions, irrespective of the hierarchy. This also helps new ideas to surface. Concerns have been raised around the culture of compliance. Our ombudsman system today is mostly compliance oriented. We want the same around businesses, where if someone feels things are not going right, he can bring it up. The focus is on delegation, agility and trickle-down of decision making. For example, there is a feeling that in the power business, we weren’t fast enough in reading the market signals — the shift from gas-based to renewables. Setting the culture is the toughest part. We are making sure that we have the right people. Frequent communication like town halls and Q&A sessions are being held where people can send in their questions anonymously or by identifying themselves.

    How has your journey as GE India head been?
    It was baptism by fire in September last year. My first day (as the CEO) started in Patna, focusing on a railway deal. (News that India might cancel GE’s $2.5-billion diesel engine deal made headlines then). As John was here (he headed GE India between 2009 & 2013) and he understands India, that helps. On the railway contract issue, he was unbelievably supportive. I talked to him multiple times around that time. It was a tough period. He understood how some of these things happen here. There is confidence that contracts will be respected and honoured. John understands opportunities and challenges here. That makes it easier. He understood reforms like GST. The challenges around IBC, land and labour reforms, he gets it automatically. He understands the government, the landscape and the challenges in the country.

    How important is India on GE’s global map?
    For a long time, India was about potential. But now that potential is translating into results. This year, our orders stood at $5 billion. India is among the top five countries, in the league of China, Japan, the US and the UK. It is certainly among the top five from the growth perspective. There is huge confidence in India’s talent. While in business China is 70-75% larger than India, our employee base is about the same as in China, at around 20,000. Since 2015, we have seen steady growth. That’s a big motivating factor. Our businesses are all growing and outlook remains positive for the foreseeable future. GE India is like a mini GE with all key businesses. GE technology centres with 4,300 employees are located in Bengaluru, Hyderabad, Chennai, Noida and Mumbai. The 50-acre $220-million John F Welch Tech Centre in Bengaluru is the largest integrated multidisciplinary R&D centre outside the US.

    How are the different businesses performing in India?
    In renewable energy and aviation, India is among the fastest-growing markets. In power, with the focus on grid emissions, we expect it to grow well. We see huge opportunities in Bangladesh. We are trying to grow in manufacturing. Today, 40% of manufacturing supply here is being exported. Our manufacturing footprint is the highest in aviation.

    On future outlook, aviation continues to grow fast. The renewable energy business here is very competitive from the tariff standpoint. In power, it’s a good mix between Bangladesh, which has gas-based projects, and India, which is coal based. While power, aviation are all growing fast, I expect the renewable energy business to grow the fastest. In fact, defence could be our fastest-growing business if things fall into place. The potential is very large, though not much is expected this year. By 2019, we will begin to see some fruition. It could be one of our largest businesses here.

    How does the future look for GE India?
    If you had asked this question six months ago, I would have been concerned. Today, we are as optimistic and more sure of growth than ever. Every sector, every business is performing well. Maybe defence would have happened faster if election in India was not on the horizon. But remember, there are other dynamics (like bilateral issues between India and the US) at play.

    For an MNC, what are some of the anxieties around elections and political transition?
    We will be fine as long as there is no policy disruption, which, I hope, won’t be there. If there is policy disruption or it gets stalled, that would be of concern to us.

    Do you have a social media presence? How do you prioritise time?
    I keep off social network. I find that its use has been distorted. Certain leaders do a good job of it. But it is not for me. About 60-70% of my time goes into meeting customers and GE employees, and focusing mostly on strategy, talent, market and customers.

    Do you have any golden lifestyle rules?
    Normally, I wake up by 5 am and sleep by 10 pm. If I have to travel, I try and travel a day before to get into bed on time and maintain my morning routine. My health is a priority. At least 60-90 minutes of workout every morning. This is fixed irrespective of my travels. This helps keep me energised, clears my mind and allows me to think.

    Think time is important and I block at least an hour daily for that.

    graph-3


    Vishal Wanchoo: A snapshot

    Education
    An IIT alumnus and a graduate from the University of Southern California

    GE journey
    Joined GE in 1997 and rose up the ranks. He took over the India reins last October

    India business
    For a long time, India was about potential. Now it is translating into results. Every business vertical here is growing and performing well

    CEO’s thrust
    Focus on culture, communication; be the glue between the businesses to tap into the synergies

    Mood inside GE
    It has been a tough year. There have been anxieties. One hates to read what the press is writing

    Social media mantra
    Keeps off it; feels its usage has been distorted

    Golden rule
    Pack in an hour of workout every morning and budget for daily think time



    (You can now subscribe to our Economic Times WhatsApp channel)
    ( Originally published on Sep 22, 2018 )
    (Catch all the Business News, Breaking News Budget 2024 News, Budget 2024 Live Coverage, Events and Latest News Updates on The Economic Times.)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    ...more

    (You can now subscribe to our Economic Times WhatsApp channel)
    (Catch all the Business News, Breaking News Budget 2024 News, Budget 2024 Live Coverage, Events and Latest News Updates on The Economic Times.)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    ...more
    The Economic Times

    Stories you might be interested in