Wednesday, December 21, 2011

[ZESTCaste] The rise of Dalit enterprise: Tata, Godrej and Thermax among groups taking lead in supplier diversity

The rise of Dalit enterprise: Tata, Godrej and Thermax among groups
taking lead in supplier diversity
Naren Karunakaran, ET Bureau Dec 20, 2011, 01.11am IST

MUMBAI: An intimidating wall, separating the sprawling Tata Motors
plant and the spartan workshop of Abhijeet Surface Coatings, at FII
block, Pimpri Industrial Estate, Pune, has stood tall and strong for
many years. Gokul Gaikwad, the dalit founder of Abhijeet Surface
Coatings, could hear the deep rumblings of industrial activity behind
the wall everyday, but never managed to scale it and do business with
the auto major. The wall cracked last weekend. Gaikwad didn't cross
it; Tata Motors did.

Several vendor development officers from Tata Motors spent time with
Gaikwad at his stall at the Mumbai trade fair organised by the Dalit
Indian Chamber of Commerce and Industry (DICCI) the last weekend. The
fair, put up to showcase the growing prowess of a new breed of dalit
capitalists, helped Gaikwad get the breakthrough he has been wanting
for years. As a first-generation dalit entrepreneur, Gaikwad just
doesn't have the peer network and financial or organisational backing
that will help him break into vendor lists of large companies. He
could never have broken into the big league of mainline companies. But
now, they are coming to him.

A small clutch of heavyweight industrial groups — Tata, Godrej,
Thermax, Forbes Marshall — and a few MNCs such as Cummins India are
beginning to intentionally engage with dalit entrepreneurs, hoping to
identify, nurture and integrate them into their supplier fold. The
movement has picked up speed since last month when the central
government opened up a .`7,000-crore opportunity with a dalit
enterprise-friendly sourcing plan.

The private sector was seen as alaggard in supporting the concept of
'supplier diversity'. Not anymore. Displaying a sensitivity rarely
seen in Corporate India, Ratan Tata, Adi Godrej and Farhad Forbes not
only made it apoint to visit the trade fair and spend time with dalit
entrepreneurs from across the country but also spent a few million
rupees in helping DICCI organise the event itself. What was glaring
was the absence of the rest of industry.

This doesn't bother Farhad Forbes of the Pune-based Forbes Marshall Group.

Farhad Forbes categorises Indian industry into three kinds: the small
set of proactive companies keen on supplier diversity and issues of
the underprivileged; the fence sitters, 'who may want to do things but
don't know how to' and, of course, the sceptics who view such moves as
inimical to the interests of industry. "Fortunately, the fence sitters
form the largest group," says Forbes. "So, there is hope."

When Ratan Tata arrived at the venue on Saturday, a minor stampede
ensued as every dalit entrepreneur wanted to have a word with him or
exchange cards. "We are not looking for concessions, what we want is
opportunities," says Milind Kamble, chairman, DICCI, who along with
Kalpana Saroj, chairman, Kamani Tubes, flanked the Tata Group chairman
on the dais.

Ratan Tata was also seen whispering into Saroj's ear. He told her how
the founder-chairman of Kamani Tubes, Ramjibhai Kamani, had bailed out
Tata Steel from a serious labour issue in Jamshedpur many decades ago
by influencing Mahatma Gandhi to visit the city and address the

Tata's presence and his unambiguous support to the cause have infused
a lot of energy into a micro ecosystem that has struggled for a long
time. The Tata Group chairman told the gathering how important it was
to ensure confluences of creative minds and the need for entrepreneurs
of all hues to participate in and seek a share in the prosperity of
the country.

Expectedly, dalit entrepreneurs used the opportunity to the hilt. A
young entrepreneur manufacturing electrical control panels extended
his visiting card to Raghu Kowjalgi, GM (materials) at Forbes
Marshall. Kowjalgi asked him whether he simply fabricated panels or
did value-addition by wiring it up too.

The answer was in the affirmative. "Do you also paint the panel?" The
answer was a no. "Examine the possibility of either outsourcing
painting, or set up an in-house facility; and we shall talk. Come over
anytime," the youngster was told. Divides, evidently, are dissolving.

Kowjalgi, as materials head of an engineering company, is a much
harried man. It's extremely difficult to identify and develop good
vendors. He goes on to explain how he has been struggling to find
suppliers of foundry components. Foundries are manual by nature and
therefore scaling up is difficult.

Much of the small-scale foundry capacity in the country is monopolised
by large companies leaving little for mid-level companies like his.
"There is a clear business case in supporting supplier diversity," he
insists. He talks about a new dalit entrepreneur he has identified:
"He is technically very sound; all he needs is some help with getting
the necessary certifications. Finance and other minor issues can be
sorted out."


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