Pathbreakers 2
“I made a promise to myself that if I learn something, I will teach it as soon as possible”

Sanjeev Kapoor, who became a top chef at just 27, shares his recipe for success

He became a top chef at just 27. He has made television history by conducting the most popular cookery show on TV for 14 years. He then created publishing history by writing books on recipes that have sold millions of copies. All this from a man who was brilliant at school and wanted to study architecture. But if fate pushed Sanjeev Kapoor into hotel management, he did not leave anything else to chance after that. He applied himself passionately and rigorously to excelling not only in the art of cooking but in managing businesses with multiple revenue sources. The Sanjeev Kapoor brand is also nurtured with a strong sense of ethics including the insistence on rigorous testing of all recipes. That is how he conjures up perfect recipes – for food and business success

ML: Can we start from the beginning… where were you born and what were your early interests?
I was born into a family of bankers in Ambala; my father was posted there. He was with the State Bank of India. My grandfather and many of my uncles were bankers. My father’s job was transferable, but primarily in the north. So I studied at various schools where we lived – Delhi, Meerut, Saharanpur. I was academically brilliant and usually topped my class. I was never a studious kind of person, but I could score well.

ML: When you were young, did you think you would also become a banker?
No, but from childhood, I always wanted to do what other kids were scared to do. For instance, at one stage, we had to choose between Hindi and Sanskrit and I chose Sanskrit. I was the only student in the class who opted for it. So the principal called me and said: “Why do you want to study Sanskrit? You are the only one in the class.” I said, “But there is a teacher.” We went back and forth and then he called my parents and asked them to convince me. They supported me. One reason I chose Sanskrit was that I knew I could score well and, thanks to that, I was in the merit list.

When I was a kid, I had thought I would become a doctor. At that time, brilliant students chose to become doctors or engineers. But something happened and I began to hate my biology teacher. It was over a tiny issue. We were asked to draw an electron microscope. I had done a brilliant job and was very excited about it – but in the process, I forgot to label the parts. When I gave it to the teacher, I expected him to be impressed. Instead, he took a thick red pen and wrote ‘label it’ across the drawing. That put me off completely and I said, “I won’t study biology.” Otherwise, I would have become a top doctor, I guarantee you. I could have done engineering. Going to IIT was an option, but it was predictable and didn’t appeal to me.

ML: So, hotel management and food was nowhere on the scene?
Not at all. In fact, my brother was more into cooking as a hobby than I was, but he became a chartered accountant and is now a strategy consultant. Cooking was nowhere in the picture. In fact, I had thought of doing architecture at the famous School of Planning and Architecture (SPA) in Delhi. They admitted 15 students from around the country and I was confident of getting in. But, when the admission list was put up, I was wait-listed. That was a shock. I never thought I would not get in. So here I was; I had not appeared for IIT or applied anywhere else and I was wait-listed. Then a friend suggested that I apply for hotel management; he had an extra admission form. Those days, hotel management was for people who could not do anything else. Just for the fun of it, he filled up the form on my behalf, submitted it and, a couple of weeks later, he turned up and asked, "How did the interview go?” I said: “What interview?” He said, "The one for the hotel management course.”

Actually, it was my friend who wanted to join the course and wanted a sense of what they would ask at the interview. I said, “Forget about me joining; I will come with you and give you moral support.” When we reached the institute, there was a large group of students waiting to be interviewed. The criteria were – 50% marks in graduation and performance at the interview. There was a discussion there about how you could secure admission only if you knew someone, otherwise it was impossible. I said, “How can that be?” I wanted to prove that you could get in if you deserved it.

So, I went in and gave the interview committee a story about how I could not make it to the interview on the date given to me. They said, with these marks, nobody joins hotel management, why are you wasting your time and someone else’s chance of getting admission? I said, “But this is what I have always wanted to do. It is my passion, right from childhood. Otherwise why would I have taken the trouble to fill the form and come here”? I was selected. In the meanwhile, I also got admission to the SPA.

One day, I was talking to my dad’s friend. He said something interesting. “It is better to excel in a mediocre field than be a mediocre in an excellent field.” At that time, architecture was considered excellent. Anyway, I joined the hotel management programme – but even that decision had nothing to do with cooking; it was about management. My friends thought I was mad, but my family was pretty okay with it – they never interfered with my decisions, as long as I believed in what I did. So I joined hotel management; but even then, I never thought of food production as a career. Those days, being a chef didn’t call for formal training and education.

ML: It is a long grind to being top chef, isn’t it?
Yes, that is interesting. When I qualified, the biggest chain of hotels was ITDC’s Ashok chain. Those days, Oberoi and ITDC had the best training programmes. I joined Oberoi; but on the first day, they assigned me to the Flight Kitchen. I decided I didn’t want to do that, and joined ITDC where also I had been selected. I didn’t appear for the Taj interview, because they were unfair – they would take people in the management grade from the Bombay Catering College and those from Delhi Catering College were appointed a rung lower.

Hotel management was a diploma course and I believed I needed a degree. My brother said: “Why don’t you do a commerce degree at the same time?” I said, “I am a science student, how can I do commerce that too an honours course?” But he was confident I could do it and I completed my BCom at the same time as hotel management.

ML: What was your experience in ITDC?
SK: At ITDC, on the day of induction, we were taken to different departments. When I met the executive chef, I asked him, “How old are you?” He said he was 40 and was curious to know why I had asked that question. I said, “I want to know how long it takes a person to become executive chef”. He said, ‘I started at 20, it has taken me 20 years, and I am probably the youngest to do so. Now that you know how long it takes, what do you plan to do about it’? I said, “if everybody takes 20 years, I will do it in 10.” He laughed and asked me how I planned to do it. I said, ‘If everybody spends eight hours on the job, I will spend 16’. Actually, for the first few years, that is exactly what I was doing. No day off, learning as much as I could from cooking skills to management, to just about everything. I was totally focused on my goal. Fortunately for me, the rules of the industry also changed and people could become executive chefs earlier.


ML: But ITDC was a government set up where promotions are based on seniority. How then did you have such a goal?
SK: Well, did I become executive chef there? No. We were trained for two years; of this, we had to train as an understudy to a chef for one and a half years. I was sent to Benares. I had gone there as a trainee. Within two months, the general manager thought I was better than the chef. So he spoke to the Head Office and got the chef transferred; I was made in-charge of that kitchen. So while I was being trained, I also worked as the head chef there.


ML: Wasn’t it unprecedented?
SK: It was completely unprecedented, especially in 1986. I was there for over two years. The exposure was tremendous. I was doing everything -- cooking, managing, man-management including handling the unions. The best thing about working in a government hotel is that you have two kinds of people – those who work and those who don’t work; and the people who work, also work for those who don’t.


ML: But wasn’t it a problem that someone so young was put in charge?
SK: Oh yes. They saw a kid heading the section and there was huge resistance. They were testing me in the first three months. Since it was a small hotel, in the rainy season, we used to buy fish from Kolkata in bulk and freeze it for three months. I had ordered 300 kilos of bekti fish and I told one of the cooks to fillet and deep-freeze it. He said, “you have ordered such large quantities of bekti, we have never filleted it before.” I still remember the guy’s name and face – he was Batuknath Mukherjee. I said, “don’t you know how to do it?” I asked a couple of others, they also said they didn’t. So I said, okay, I will teach you how to do it this time and you will have to do it yourself the next time. As luck would have it, I had done my butchery thoroughly. During our training we used to be sent to Vigyan Bhavan and there used to be a cook there who used to fillet big bektis like an artist. I was so fascinated by it that I had spent a lot of time learning how to do it. He did it in great style. He used to fillet a 10-12 kg fish, then lift the rest and flip it into a dustbin. I too had perfected that. So, I couldn’t have asked for a better opportunity to demonstrate it. After the first one, Batuk got up and said he would do it. I said, “No Batuk, you will sit here till I finish this.” I filleted the fish at a fantastic speed with all that style. After that, they treated me like I was the king of Benares until I was there. They were completely spellbound. Of course, there were things I didn’t know, like tandoor, which I learnt there. So my message was: if you work with me, work according to my style. I will teach you what I know and learn what I don’t. So it was a fantastic learning experience.


When you work in a government-run hotel, you learn a lot more than cooking. You get up one morning and find there is no hot water and that the boiler is not working. There is nobody in engineering so you learn how to turn on the boiler and find that there is no diesel. So you take the staff car and a drum and go to buy diesel and they ask you, do you want HSD or LSD? It teaches you so many things. After Benares, I did a stint at the Ashok Hotel and was then sent to New Zealand. By then, everybody knew there was something different about me. It is not that in the public sector you are not noticed or rewarded. I got the best postings, went to various places. In fact, everybody thought that I had some political connection that got me the postings.

ML: What was the New Zealand experience like?
SK: ITDC had sent me to open an Indian restaurant. When we reached there, the owner said, “Why have you come so early? The opening is a month away.” He didn’t want to pay us for that month. But within a week, he was saying that we should have come a month earlier. He had made a few mistakes and we showed him how to do things differently and save some money. There I learnt how to run a business. Within two months, the owner realised that this chef can manage the show. So although there was a general manager there, he told me to manage everything. ITDC wasn’t bothered about what we were doing and that suited us fine. We had a fairly large kitchen there; so I told him, from this kitchen I can open one more restaurant if we can hire the place next door and a couple of chefs. He said that is fantastic. The owner once lived in Africa. So I said, let’s open an African restaurant. That did well too. We called it Zanzibar. I had cheque-signing authority there and I had to make sure he made money. I too was incentivised.


ML: How long were you there?
SK: Two and a half years. I came back to Delhi sometime at the end of 1991, and, in 1992, I came to Mumbai. The managing director of Centaur (Hotel Corporation of India), Anil Bhandari, visited Delhi and came to the restaurant called Frontier. It used to be fantastic, better than Bukhara. He liked the food and on enquiring with the corporate chef learnt that there was a chef who had come back from New Zealand and was good. Bhandari asked him, “Would you object if I asked him to join me?” He did not. So Bhandari asked me if I would be keen on moving to Centaur. It wasn’t a big deal but I wanted to be an executive chef of a five-star hotel in 10 years and this was an opportunity. I said, if it was the Centaur Juhu property, then I would be. It was a large place and had a lot of these filmy parties. It also suited me because my would-be father-in-law had just retired as the Director General of Naval Design and was staying at Juhu. So I agreed, on the condition that they made me executive chef. I was asked to meet the director administration who said, “You don’t even have a single grey hair; how can we make you an executive chef?” After some discussion, they said, they would give me charge of food and culinary development while they would have another person for management of the kitchen and administration. I said, “nothing doing, without unity of command, it doesn’t work.” I was just over 27 and still had over two and a half years to become executive chef. So I said, ‘okay, if you have a problem, then put me in charge, give me the number one position, don’t call it executive chef, but one rung below that.
Let me be on probation for a year and if I deliver, you will give me the designation. They went back and forth and finally agreed. Within three months, they had made me executive chef of Juhu Centaur and I remained there for a few years.


ML: So you beat your target?
SK: Yes, I did. But I suddenly realised that that was a problem too. I had bettered the target, but it meant that I had reached the peak of my career so early.


ML: You didn’t want to move to, say, a global hotel chain?
SK: Well, I did look at other options. I was offered executive chef at Taj Bengal and I had almost joined there. I was interested in it because I was told that they had the best kitchen equipment, since it was a new hotel. But, by then, I had also started doing a TV programme so I did not join Taj Bengal.


ML: How did television happen?
SK: I was at Centaur and Zee TV was to be launched. There was a producer and director who used to be in Fiji managing a radio station. He approached Zee and wanted to do a television show. They said, most other programme slots are gone, but if you want to do a cookery show, it is open. He took it and then went to various hotels and met the top chefs to participate in it. He wanted a different chef for each episode. When he met me, I said it sounds interesting, but what will the show be called? He said, Sriman Bawarchi. I turned it down. When he asked why, I told him, “I am the executive chef at a five-star deluxe hotel; the title doesn’t go with the profile.” In 1992, television was huge and he was amazed that I would turn down a 30-minute show because of the title. He told me that many chefs who were bigger names than I, had agreed. Later, he asked if I could suggest a name and I gave a few options. Khana Khazana was one of them. He had an Australian partner who heard the name and said; “I don’t know what the hell it means but it sounds good phonetically.” So they decided to go with it, but Zee turned them down. They said, “it is our channel and our show, who are you to choose the name?” But I persuaded them to let me go along and convince Zee. I managed to change their thinking and I was still to do one episode.


ML: You went through all this trouble for just one episode? Most people wouldn’t have bothered.
SK: But it was exciting and different. Also, you must remember that, more than anything else, there was this fear in my mind that since I have reached so far, so early, what would I do next? Not only this, I also joined Narsee Munjee College for a part-time business management course from 7pm-9 pm. I was the oldest in the class and when they asked me why I was there, I said, “I am doing it for my dad; he always felt that I hadn’t studied to the full extent of my capability, so I am doing it.” Meanwhile, since I was showing such interest, the Zee producer said, “why don’t you become a consultant to our show?” I agreed.


ML: Did Khana Khazana really start with different chefs? Was it aired that way?
SK: No, but that is another story. The producer wanted me to do the first episode, because he thought I could do justice to the show. There was a popular actress who was to be the host and I was to cook. We shot for a full day and, at the end of it, the director wasn’t very happy with the actress. So he said, “why don’t you become the host and we will get other chefs on the show?” We shot three episodes like that and all of them got rejected. Anything that could go wrong, went wrong. The channel was new, the producer was new, the host was new, and the cameramen were new. I wondered whether I should keep working for the hotel and forget about television. Meanwhile, the multinational sponsor said, “this is a women’s show, we must have a woman host.” Obviously, since I was in each show, it wouldn’t work that way and the producer didn’t know what to say to me. Then one day, I got a call from the producer who said that one of the chefs who was to do the show had not turned up. He had the whole set booked and no chef. So he asked if I could go there and shoot. I said, “But my episodes were rejected.” He wanted to take a chance, but said that the channel may still reject it. I went there, saw what they had and said, “okay, I will cook something.” The host was a chatterbox and rather irritating. But the show went off well and was very lively. Since it was unplanned, the last dish I cooked was a chicken breast, stuffed with spinach and cheese in orange sauce and flambéed. She asked me what the dish was called. I said I was cooking it for the first time and hadn’t named it. I turned to the viewers and said, ‘why don’t you suggest a name for this dish?’ The letters that we got were in lakhs. It was stunning. It happened to be a little before Diwali and, those days, the tapes had to be sent to Hong Kong and uplinked from there. For some strange reason, the tapes of the next episode and even the one after that could not be sent. So my show was repeated nine times over the next three weeks. Every time it was aired, there were more letters. The channel just couldn’t believe what was happening. The director immediately said, “Well, we always told you that he is the one who can deliver.

ML: You are extremely comfortable in front of the camera and it works.
SK: Well, it does not come to me naturally. What do I do on TV? I teach; and you have to be a good teacher. I am also a very good speaker. All through school, and even during the hotel management course, I used to win all the elocution competitions. That helped. When I joined the hotel, I realised that the most difficult thing was to learn from old-timers. They would not teach. They would keep their recipes guarded; they would carry their special spices in tiny pouches, etc. How is one to learn, if the seniors don’t teach? I used to be so annoyed, I made a promise to myself that whatever I learn, I will teach it as soon as possible. In my first posting at Benares, I had started cookery classes in the hotel. My first students were the wives of top officials like the district magistrate and the superintendent of police. In New Zealand, I used to take cookery classes on Saturdays. At Centaur, I used to take classes and I even had a tie-up with SNDT University. When you teach, you understand what the students want, what questions they are likely to ask and can anticipate them. So I knew exactly what to explain. If you can teach well, cook well, speak well and smile well, then the show is done. Moreover, it is a fact that our industry doesn’t always attract the best talent and that is a regrettable. Even today, there are no ESOPs or profit-sharing in the hotel industry and hotel staff is among the worst paid.

Salaries have, indeed, risen by around 400% in the past year and a half, but the base was so low. A general manager in a five-star hotel will not get more than Rs50 lakh and there are just around 20 people in the country at that level. And look at the number of hours hotel staff put in! There are no weekends, no holidays.


ML: How did life change after that show?
SK: Well, I was still working at Centaur at Rs10,000 a month. Later, I quit my job and decided to do things on my own. For the past 14 years, I have been doing Khana Khazana. Then I started my own company after my brother pushed me to do it. He said “you are wasting your time at the hotel.” At that time, I didn’t have a house and, between my wife and me, our bank balance was less than a lakh.


ML: You were so clear about wanting to be executive chef at a certain age and were also on your way to planning an alternate career. So you must have had some clear plans and goals then.
SK: When the show became popular, my game plan was to make myself financially stable. I wanted a decent car, a house – those were priorities. But I always thought ahead. Even when I was at Centaur, I had my own website Even when Times of India didn’t have a website, I had one. In fact, we were one of the top 20 websites in India during the dotcom boom; we were one of the hottest sites that people wanted to acquire.


ML: But you chose not to sell?
SK: No, no. I did look at the offers, because there were so many of them. I had at least 20 meetings with Edelweiss. Rajesh Jain had just done a big deal at an obscene Rs500 crore. We weren’t making money, but our content attracted enormous traffic, so I decided that I must get at least Rs100 crore. It didn’t work out and I haven’t regretted it even for a day. My point was that I didn’t know whether I was giving away my right hand or my left by signing away the site. So I have no regrets. After the website, which helped reach out to people, came the books and that was big. I was not very keen on them initially because I wondered why people would want to read recipes since they were freely available on my show. But people kept asking me if I had any cookery books. Then, thanks to Tarla Dalal, I got into writing them.


ML: How did that happen?
SK: I came to know that her royalty for one year was around Rs80 lakh. This was in 1996. When I heard that, I said “wow, I must do this.” But even after I made up my mind, it took a little while. The reason why it took so long was that I used to put every recipe through several trials. I even asked those who could not cook, to try cooking something based on my recipe, to see if it turned out right. Then I published my first book -- Khazana of Indian Recipes –- and it was a big hit. My closest competitor was Arundhati Roy’s God of Small Things. We did upwards of 100,000 copies in the first year itself. That was really big and we – Harsha (Bhatkal owner of Popular Prakashan, Kapoor’s publisher) and I – decided to redefine this category. In fact, in these last 10 years, we have achieved a lot. In the past year and a half, we have sold 1.5 million copies and we will do even better this year.


ML: How is the publishing business structured? Is it a partnership?
SK: Yes, it is a partnership. I get a share of the profit – in fact, a large share of the profit. It is not an easy business. What we realised is that we needed a lot of titles to have more shelf space and catch up. So this year, we are aiming for 50 small books and four large books. Maybe we are ambitious; but we will not compromise on the way we do the books, the trials and the testing.


ML: But before you started the books, you were working at developing recipes for product companies, weren’t you? For instance, microwave recipes?
SK: The first book that I did was on microwave cooking for BPL. That was my first big cheque and carried my name also. I did a lot of consulting for the food industry, but I wouldn’t allow them to use my name. I would charge a good fee, which was pretty high by my standards, but I used to say, “You only pay me if it works.” I used to work on things that are considered pretty impossible. My logic was that I got the opportunity to learn at their laboratories and with their equipment, etc. I worked with several top food companies; but all our development work is bound by confidentiality contracts, so I cannot name them.


ML: So you started with the television show, website, books, then consulting—what else?
SK: Franchising of restaurants. Our director at Centaur wanted to set up a restaurant in Dubai because he had a brother-in-law there. He wanted to do it with me, although he himself had worked with the Taj. He said: “this is one chef who understands costs and knows business.” I wasn’t interested in a one-off restaurant. But he pushed me to do it and to work on a franchisee model and give my name and expertise. That sounded good. I still didn’t have a house. So he said he would give me a chunk of money as pre-opening fee. I agreed. That was 10 years ago and the restaurant was Khana Khazana. Then a friend of my brother’s said he wanted to open a restaurant in Ludhiana. I went and saw the place and said I couldn’t do it because the location and place wasn’t good. My brother said, “Don’t say no. You can’t aim for a five-star ambience everywhere. Can you design something for this market?” I said, “I would do it only if they were willing to change everything to meet my requirements.” They agreed and we started the Yellow Chilli.


ML: Do you have a clear segmentation among your restaurants?
SK: Yes. We have Khazana in Dubai; in Ludhiana, it is the Yellow Chilli, which is still among the best restaurants there after nine years. The Yellow Chilli is not in any of the major cities. We underplay our restaurants, because it is the one segment where brand erosion is likely to be the highest. We don’t want to create a big picture about our restaurants. I must also admit that we were not giving our best to the restaurant business because the excitement was not as much as with other things. But 10 months ago we decided to do restaurants in a big way. So we gave the Landmark group the master franchise rights for Yellow Chilli in India and Grain of Salt, our restaurant in Kolkata. In the next year, we will set up seven to eight outlets in Mumbai, Pune, Bangalore, Hyderabad, Delhi … we are doing it with a bang now. It is all very structured. Although we haven’t opened a single restaurant, we have over 120 people on board already, including an advertising agency and a PR agency. We have asked them to set up an R&D kitchen which is functioning. At our end, we have a quality audit team and a team of chefs in place.


ML: Where does the learning for all these new activities come from?
SK: Mainly from observation, I would say. It is not rocket science – it is just a process. The process itself is fairly simple; putting it in place and rolling it out is very difficult. For instance, making a McDonald’s burger is fairly simple; putting the process in place, to get identical burgers around the world is difficult. That is why we don’t have a single quick-service Indian food chain anywhere in the world. Not even one. And I often say that if anyone in India can do it, we alone can. People don’t understand that to get everything right and to put together the puzzle of consumers’ taste and the process delivery is not easy. Consider this. I have been doing this television show for 14 years non-stop – it is the longest running show across all categories. So we must be doing something right, isn’t it? The same goes for books, where we are the leaders. We are nowhere in foods, because we have not even reached the test market stage; we are still in the development stage. We are still at the stage where we are learning how to create more SKUs (stock keeping units).


ML: When you say foods, you clearly have some specific sections in mind. What are they?
SK: Let’s say pickles, chutneys or ready-to-cook pastes—our presence in the market is nothing. But that is a call we have taken because I am still learning that market. I need to be comfortable with my product in the market as I am with books or television. My issue is that if I get into something, I have to know everything about it myself. Even if I am sitting with a lawyer for a contract or intellectual property, I will know little in the first couple of meetings but by the third meeting, I would have studied all the details myself. It is the same with my books – the quality of paper, the ink used, the design – I am involved with everything.

I know foods, but do you think we are trained to make pickles in our hotel management course? No. Homemade pickles cannot be sold in the mass market. Mangoes have to be bought in season; put in brine tanks; we add spices in a different way. Did we know it? No. We had to learn it; check how the industry does it and then figure out how to do it better. We now make gourmet chutneys. We just sent our first container to the US; we are not selling it in India. Tesco has agreed to take our ready-to-cook products in the UK. But we are still learning how to do it in a factory. For instance, if we are making a red chilli pickle, we find out the quality, the source, the right season for buying it. In this case, it is Benaras. So the person will buy it from there, get my approval and, once approved, it is put into a process. Until then, I want to know everything. We currently have 30 SKUs in food, but we need at least 100 to have a real presence. Of course, we are not in every food segment – there are many things we don’t do.


ML: How do you see the food processing and restaurant industry in India developing in the coming years?
SK: The question is, how would branded players be perceived by customers in a market that is price sensitive? Would private labelling work the way it works internationally? Branded foods naturally cost more and, in a price-sensitive market like India, will people prefer private store brands? I hope not, because it is not in our interest. Currently, we get our products manufactured outside. But if the private labels do well, we will reduce costs, increase volumes by putting up our own manufacturing plants. We can even do it for others. Currently, it is a learning curve for everybody and we don’t know how the market will evolve. If branded food works, we will do well and we will create more brands and grow.


ML: If you were to point to five mega trends in the food industry, what would they be?
SK: Franchising has just started. The death rate of restaurants is very high. But franchised restaurants will do better. In the US, 90% of non-franchise restaurants close within three years. Management of cost, brand and logistics is a problem. With franchised restaurants, the ratio is completely reversed.


ML: But things are changing, aren’t they? For instance, Chitale of Pune never sold outside their own store; today, their brand is available in many stores.
SK: Do you know them? You must check what made them change their mind. I had made a few press statements about Maharashtrian food and why it is not as popular as Punjabi food or Gujarati food. I said, ‘Maharashtrians have a problem – they suffer from a syndrome called “bhakarwadi sampli” (bhakarwadi, a popular crispy savoury snack from Chitale, the most famous sweet shop in Pune, has people queuing up every morning to buy it. Within a couple of hours, the ‘bhakarwadi sampli’ -- ‘bhakarwadi is sold out’ black board would be displayed prominently to stop pesky customers from asking for it. For decades, most non-Maharashtrians wondered why the Chitales didn’t simply produce more. But that is the way Maharashtrians apparently do business - Editor).

My comment made front-page news in Pune. A while later, the owner called me to say, “we are now producing a lot more, so please stop saying that.” And, indeed, they have taken off. I now see Chitale vans delivering a host of products, including gulab jamuns and dahi. They do a very good gulab jamum mix and we always wondered how they did it differently. After a lot of research, we realised that the milk powder that they use is different. So we checked again to figure out why it was different and where to get it. We found out that they make it in-house, using the old oven-dried method, rather than spray-dried powder. So the particle size is larger. You can’t get it from anybody else, because nobody uses that technology. I am told that they don’t sell it to outsiders.


ML: So that is one trend, where ready-to-eat brands like Chitales are now producing more. What about other chains like Anjan Chatterjee’s Mainland China?
SK: If there is somebody who can do a large chain in a fairly decent way, it is Anjan. His delivery has been fantastic and he is passionate. A couple of years ago, we were dining in Mainland China and he was around. We were discussing how there aren’t too many good Chinese desserts, which affects sales. So I said Bombay Blue (another Mumbai-based food chain that is growing rapidly) does a sizzling brownie with ice cream. My kids love that. He asked “how do you do that?” I told him how easy it was because the brownie as well as the ice cream can be sourced from outside. He said, ‘from tomorrow all my restaurants will have it’. As luck would have it, we went back the next day and he really had it! A few days ago, we went to another of his restaurants – Machaan – an Indian restaurant – and I found that the sizzling brownie was there too. What is amazing is that he actually implemented it overnight and literally in all his restaurants! He is similarly focused on customer feedback. One of my friends had a bad experience at one of his restaurants. I told Anjan about it and, in a few days, my friend said that not only Anjan but also several people called to ask what happened and how can they make things better.


ML: What other trends do you see?
SK: Another trend is towards healthier food. It is slow at the moment; consumption is low, but food will become healthier. There is a first-mover advantage here but you need deep pockets to do it. A big MNC can probably do it but even they tend to work on a quarter-to-quarter basis and don’t think long term.


ML: Can you tell us about your 24-hour television?
SK: Channel? What channel? (laughs). Yes, I have dreamt of having a 24x7 cookery channel for the past few years. I want to fulfil that dream, but don’t know when. It will have lots of variety, showcase the talents of many chefs. It will showcase foods from different parts of India and from around the world. It will have restaurant reviews and health information. Everything will be related to food. Even if it is travel, it will have a food angle. It seems like a distant dream today. You have to understand that just one television programme on food has survived in a non-prime time slot. Star, Sony and Sahara had cookery shows; but all have stopped. Those that exist are either not making money or are inconsequential. In this scenario, talking about a 24-hour channel seems ridiculous.


ML: Isn’t there plenty of content that can be shown and is untouched by television today? For instance, product reviews?
SK: Absolutely. There is plenty of content possible. I am not worried about how to have plenty of interesting content. The problem is getting others to believe in it. I am now looking at doing it on my own.


ML: Is distribution a constraint?
SK: Distribution is also not an issue. Of course, a new channel would cost anywhere between Rs15-20 crore a year only on distribution. But I don’t want to go to all homes; I want to reach relevant ones. We’ll go digital. Anyone who wants to see it will pay, others won’t watch it. There are service providers like Dish TV and Tata SKY and then Reliance, Bharti and IPTV are planning to be launched and they all want something different. So we are exploring possibilities and, fortunately, we are not threatened that anyone else will do it. They can certainly try.


ML: Are you planning an IPO sometime soon?
SK: That would be the natural progression. But why do I need the money now? I will need it for the channel. I am asking myself, “can I do it at a low cost?” That is my strength. I can do big things at a small cost. So do I need somebody for that? I don’t know, I may not; but eventually we may need the money. At this point of time, our business model is that we don’t invest. We find a partner who works with us on an ‘invest, operate and manage’ basis. We provide our brand and our expertise. Today, I have more money than I can use. My needs are small, I don’t waste money. I have a good office, car and house; and go on good holidays. One can get tempted. But money alone is not important.


Government for discussion on FDI in multi-brand retail

In its first term, the UPA government had shelved plans to open FDI in multi-brand retail owing to fierce opposition from its then allies, the Left, and small traders

India today said that it would initiate discussions next month on liberalising Foreign Direct Investment (FDI) in sectors ranging from defence to agriculture and even retail—a source of political woes for the government in the past, reports PTI.

The Department of Industrial Policy & Promotion (DIPP), the nodal agency for framing FDI policies, will come out with six discussion papers in mid-May on overseas investment norms.

“All the issues, which are troubling you will be covered (in the discussion papers),” DIPP secretary RP Singh told reporters at an event when asked if multi-brand retail would also figure in the discussion papers.

In its first term, the UPA government had shelved plans to open FDI in multi-brand retail owing to fierce opposition from its then allies, the Left, and small traders.

India, however, allows 51% FDI in single-brand retail and 100% in the cash-and-carry (wholesale) sector.

While transnational companies like Walmart, Carrefour and Indian industry chambers are pitching for opening up the multi-brand segment, a Parliamentary panel has proposed a “blanket ban” on entry of corporate houses into this unorganised sector which employs millions of people.

Sources in the DIPP said that the discussion papers, which would be put in the public domain on 12th or 13th May, would deal in sectors like retail, defence, pharmaceuticals and agriculture.

The DIPP would seek public comments on the concept papers, Mr Singh said.

On pharmaceuticals, Mr Singh said that the department was not averse to FDI, but is demanding review of the policy.

“The department of pharmaceuticals is not opposing FDI. They are only saying that FDI should be reviewed and it should not result in Indian companies being purchased by outsiders,” he said.

India allows 100% FDI in drugs & pharmaceuticals through the automatic route.

In March this year, India had released a compendium of all polices related to FDI.

The West—including the US and EU—is separately asking India to open up its financial sector to FDI and a Bill to raise FDI in the insurance sector to 49% from the current 26% is pending clearance in Parliament. FDI inflows in the first 10 months of 2009-10 were $22.90 billion.


“Leaders are supposed to change the status quo and that can happen only when they have an ability to empathise”

The skill-sets that Dr Anil K Khandelwal brought to run Bank of Baroda were born out of empathy and his own personal challenges

No other bank chairman in the country is as academically qualified as Dr Anil K Khandelwal. He is a BSc, BE, MBA, LLB and PhD, and holds post-graduate diplomas in labour law as well as in training & development. But the skill-sets that he has brought to run Bank of Baroda (BoB) are born out of empathy, observation and application of his diverse personal experiences from a tough childhood of hardship and discrimination. Under his leadership, BoB has moved up a solid 158 places in the ranking of top 1,000 banks (by The Banker of London) – from 416 in 2006 to 258 in 2007. It has also won numerous awards for its branding, customer service, retail and human resources. Dr Khandelwal recounted his chequered career which included five appointment letters from BoB for his various stints with the Bank

ML: Could you tell us a little about your early childhood and where you were born?

AKK: I was born in Agra and we could see the Taj Mahal as well as the Agra Fort from our terraces – those are my early memories. As children, we used to go for a walk to the Taj, but didn’t realise its importance then. In our arranged marriage system, parents used to bring their daughters to the Taj Mahal for matchmaking. I remember going there when my parents were trying to find a match for my elder brother – although no girl we saw at the Taj Mahal ever worked out (laughs).

ML: Was your family in business?

AKK: Oh yes, I come from a business family, but I have had a very traumatic childhood. One fine day, my father was excluded from the family business. I don’t know what exactly happened, since I was very young. What I remember is that it was Diwali day and my father’s brothers told him not to come for work from the next day. I also remember that my grandmother was on their side and they even cut off the electricity connection to our portion of the house. My father had to seek a job. We were four brothers and a sister and I remember that my mother used to bring used garments of her brothers and alter them to fit us. So, in many ways, it was a turbulent childhood trying to cope with hostility and the worst kind of discrimination arising out of family conflicts.

That is probably why, wherever I see discrimination, I tend to get involved. In fact, people often say that you could be on the side of the (trade) union. But I feel it is good to be a rebel as a CEO, if you want to change things. After all, leaders must be willing to change the status quo; that can happen only if they have a conscience and the ability to reflect and empathise. If I have these traits, they come from my childhood.

ML: How long did this phase last?

AKK: Oh, it lasted for quite a while. Because of this, my early education was in a school that was worse than municipal schools, if there is such a thing. It was a Hindi medium school and our fees used to be waived on the recommendation of our neighbour who was an education inspector. I learnt a bit of English in my sixth standard, but it was rudimentary. I got interested in English only after my intermediate year when I was in Delhi with my brother during summer vacations. It was one of those days when a neighbourhood boy remarked: “how are you going to achieve anything in life when you don’t know English?” That brought about a personal drive in me to learn the English language. I started reading books and magazines and, even today, I maintain a diary; whenever I find a good word, I note it down. I had a traumatic childhood full of deprivation and, although it seems like a distant nightmare today, I cannot forget those days or help thinking of others who have so little to live on.

ML: But that does not seem to have stopped you from getting a good education. How did that happen?

AKK: My elder brother went to Rajasthan to stay with my maternal uncles and studied there. He did his MA and got a job at NCAER (National Council of Applied Economic Research) and later at the Institute of Economic Growth. This was in 1964. Later, he went to England and joined the civil service. He took charge of my education. I was a mediocre student and used to get only a second class. In the kind of schools we studied, we hadn’t even heard of anyone aspiring for anything more than just passing their exams. By then, I had gone on to do my BSc and it was my brother who gave me a goal of sorts. He said, if you get a first class, I will call you to England. I was studying at the Agra College. This then became my goal. I was crazy to visit England.

ML: What did you plan to do at that time in terms of your higher studies?

AKK: I really don’t know. I was doing BSc and I later did chemical engineering. But at that time, I had no clue about what I wanted to do later, which is why my education is so chequered. I did my BSc with physics, chemistry and mathematics and I remember working very hard at it. I could not afford extra tuitions like other students so I studied with someone who was brighter than I was. Neither of us had any place in our homes to exclusively study, so we studied in corners of public parks. The friend, who I used to study with, had 10 brothers and they are all doing brilliantly well today.

After all that effort, I barely managed to get a first class – just 60% with only one mark extra. But that was the turning point of my life. I became a celebrity overnight in the extended family since no one in my family had ever got a first class earlier. We were all hugely influenced by the views of my maternal uncles in Jaipur, especially my youngest uncle to whom we were very attached. He was in the book trade and specialised in sociology. I had at that time taken admission for MSc at Rajasthan University, but simultaneously, I also applied and got admission in the Harcourt Butler Technological Institute (HBTI) of Kanpur. It was considered among the top colleges for chemical engineering at that time.

ML: But why did you study engineering?

AKK: Out of sheer aimlessness. What else could you do? The employment scene was such that any other course would have been just sufficient to get a job as a clerk somewhere. Moreover, I was only 18 when I had completed my BSc, so I went on to do my engineering. When I passed out from the course in 1970, there were no jobs for engineers. I even got an unemployment allowance of Rs250 under an unemployment scholarship scheme of the Uttar Pradesh government. I returned to Jaipur where my uncle had a shop called Books & Books on MI (Mirza Ismail) Road. I used to go there and read a lot of sociology books. I especially read a lot of books on inter-group conflict, social groups, team organisations, institutions like marriage, gender issues, etc., which had a great impact on me. Those days, there was one Prof Sarin at Rajasthan University. He had just returned from Harvard and started a new MBA programme there. I topped the entrance test and joined. At the same time, Bank of Baroda (BoB) had advertised for probationary officers with some fanfare; Datamatics was the company that came in to hire. I decided to apply and appear for the entrance tests. This was in 1970. The Bank announced the results the very same day and I had got through. Then, for the next six months I heard nothing from BoB. Six months later, when I had gone with my uncle to Hyderabad for a book exhibition, the Bank sent an interview call for me to Jaipur. My elder maternal uncle redirected the telegram to the book exhibition at Hyderabad and, although I was reluctant, my uncle pushed me into a train to Indore where I appeared for the interview in a shabby dress. By the time I returned to Jaipur, I received another telegram, which said I had been selected and should report to Indore. Those days, the branches of BoB in the state of Rajasthan reported to the controlling authority in Madhya Pradesh. I sent a telegram back stating that I was not interested in joining at Indore because I was studying. I got another telegram from the Bank stating that the regional office of BoB had been shifted to Rajasthan and so I could report to Jaipur.

ML: It is almost like you were destined to join the Bank.

AKK: Yes, it was destiny. In fact, there was more. I met the regional manager only to explain that I would not be able to join, since I was studying. He asked me where I lived and then said, there is a BoB branch about half a kilometre from my place and he posted me there. That is how I joined BoB.

ML: Did you discontinue your MBA?

AKK: No. I had negotiated with the Bank that I would get leave to appear for my exams. But I soon discovered that there was complete chaos at the branch where I was posted. There was an accountant who gave me a real hard time. He put me at the cash counter and literally converted me into a clerk. He treated my educational background with contempt and often commented that the Bank does not require so many qualifications. It requires people who can total balances and tally balances, etc. Unionism was very strong those days and my branch was among the worst affected. In fact, nine persons were later suspended from the same branch during an agitation. My streak of rebelliousness only got heightened in the Bank in view of the negative attitude, blurring of roles and poor organisational culture. I would say that a sociologist was born there. Meanwhile, an agitation started because the Bank was expanding rapidly and had posted several managers from Gujarat at Rajasthan. For two years of my probation, I was kept at a single desk – savings accounts. I was not given any induction training nor was I ever rotated, although my appointment provided for it. I fact, I had written a letter to the chairman even while I was on probation. Those days, the concept of non-performing assets was unheard of. I wrote a letter to the chairman saying that you have made a bad investment in me. I calculated my salary for 30 years and said this ‘advance’ is going to become non-performing because I am not getting proper training. I wrote the letter out of frustration; but the Bank had a very fine Maharashtrian gentleman called Mr Bhide as the head of personnel who wrote back to me. That changed the course of my life. The very fact that a corporate manager had read my letter, responded to it and said that he would look into the issues I had raised and meet me when he was in Jaipur, made me very happy. I immediately learnt the value of responding to letters and the advantage of communicating with people whether by letter or by phone. That insight came to me by observation and my entire journey as a leader has been one of observation and application. I have always endeavoured to reply to all communications since that time.
By then, I had also completed my MBA and specialised in organisational behaviour. Shortly afterwards, Mr Bhide met me at Jaipur. I told him that I had little interest in banking and that my probation period had been traumatic. He informed that the Bank was planning to recruit personnel officers and asked me to apply. I did so. This was my second appointment, since I had to formally re-apply. This position was considered important and I was posted in Rajasthan but sent on a deputation to Uttar Pradesh (UP). That is when I went through real learning. I had a regional manager called R.C. Desai who never allowed me to sit in the office. He would constantly send me to every location where there was a union-led agitation. I was once sent to Varanasi and I returned in the same dress after 30 days! The situation was so bad that I had to go around in police vehicles. That phase gave me a lot of insight about unionisation, human problems and I saw the suffering of officers. I also noticed what made the senior management so weak in dealing with unions.

Unionism in UP was strong in those days and inter-union rivalry issues occupied most of the manager’s time such that customer service became the worst victim. We once had members of one union protesting that members of the rival union were seated below the office fans while they sweated it out; there were even fights between rival unions about who should handle the staff ledger because it involved more work. Once they broke the jaw of an accountant and I had to handle the fallout. I often complained that I got no feedback from the regional manager (RM) about the quality of my work. When I was being relieved from UP, my stenographer took me out for lunch and showed me a confidential letter. I discovered that the RM had written to the corporate office a wonderful letter about me saying that, although I was a junior, I had handled various situations very well. That motivated me. In fact, when I attended a personnel managers’ conference in Delhi, the person from the central office came looking for Khandelwal because he had read that letter. He said that the letter had been circulated to others by the deputy general manager. Anyway, I returned to Rajasthan and was there until 1976 when I resigned and left the Bank.

ML: Did you resign from the Bank?

AKK: Yes, I did in 1976. There was a journalist called S.R. Mohandas, who used to write for The Financial Express. He head-hunted me for a corporate level job in a private bank at a senior position.

ML: Did you return to BoB after that?

AKK: Yes, I did. But mark my luck. Those days, you could never imagine returning to a public sector bank after you had left it. But BoB advertised the position of a senior core faculty at the Bank’s staff college on a contract basis for two years. One position was for HR, so I applied. I had a sixth sense that I would get the job and I had even told my mother that this job is for me and I will have to go. I was selected and my second entry was as a contract employee. The status of a faculty member in a bank is completely isolated and peripheral. The Bank’s staff college was at Ahmedabad and I was there for 13 years and two months.

ML: Did you like the job so much?

AKK: I really loved the training job. Later, I was promoted to the AGM level in 1993 and ultimately, became the principal of the staff college. Our appointment letters had clearly said that our career path was only in training – so that was the end point of my career. But around then, S.P. Talwar became the chairman of BoB and picked me up for the corporate personnel department. An assistant general manager was being groomed to head the department; unfortunately, he died of cancer. So there was a search for a personnel man and, resultantly, I was called to Mumbai. But it wasn’t easy. There were protests against my joining in the mainstream and, after some anxious months, I was absorbed in the personnel department at the corporate office.

ML: At what stage did you do your PhD?

AKK: A faculty position really gives you a lot of time and nobody questions you if you do no work. But I really worked hard when I was there. I attended Law College in the mornings for three years and completed my LLB. I then registered for my PhD under Dr N.R. Sheth, then the director, IIM Ahmedabad. My thesis was on “Role of Management in Industrial Relations”. I had read an article by one John Purcell in the British Journal of Industrial Relations where he pointed out that we have always studied the role of unions, the government and impact of the conciliation machinery in industrial relations (IR), but nobody has studied the role of management in industrial relations. This fascinated me, because management is always presented as a victim in IR, whereas it is actually the main actor. So I decided to explore the subject in detail. After my PhD, I got four appointments of full professorships at various prestigious management institutes. I got an appointment in IIM, Ahmedabad, as faculty in 1993 but then Mr Talwar asked me to stay back.

ML: You must be the only bank chairman with such a string of academic qualifications.

AKK: BSc, BE, MBA, LLB and PhD. I also hold post-graduate diplomas in labour laws as well as in training & development. But I must tell you that I am a mediocre student – I have to work hard and diligently. I also like to go into the fundamentals of everything that I study.

ML: So you were here at the corporate head office in Mumbai earlier? Which year was this?

AKK: This was in 1994-95. After Mr Talwar’s departure as deputy governor, RBI, the new CMD, Mr Kannan offered me a job in banking operations. After about three months of joining, he called me one day and said, “You are doing HRD for others but not for yourself”. I was a little puzzled, but he added, “You can also sit in this chair”, meaning you can also become a chairman. He said, “Why don’t you go to Meerut. It is a small zone and there are a lot of problems. You will get a chance to prove yourself”. I told him that I didn’t know banking and my early experiences had made me hostile to banking. He said, “If you can do your PhD, you can also learn banking”. His words set me thinking. I was left wondering whether I was being kicked upstairs.

My immediate boss was equally puzzled about my transfer to operations and advised that I should quit because I could end up making mistakes in banking and I would be a loser in competing with operational people. I told him that I was willing to take the challenge. At that time, I was also going through a personal crisis – my mother was diagnosed with cancer and had to be taken to the Tata Memorial Hospital. Eventually she died, but I decided to go to Meerut. Meerut is known for all kinds of strife and violence. I didn’t know banking, so I asked myself, ‘what is my greatest strength? HR. And what is the Bank’s greatest weakness? HR.’ So I called a managers’ meet and asked them what would improve their performance by 10%? They gave me a litany of complaints. I said: ‘If I take care of all your HR issues, would you be able to improve performance?’ I did that and Meerut improved its performance dramatically. Eventually, I was promoted as general manager in 1997.

ML: Did you learn core banking simultaneously?

AKK: I learnt as much of it as was necessary. If I have not been a bank manager or an accountant, I cannot change that. So I focused instead on client relationships, customer-centricity and HR. Every weekend, I would call an intelligent junior officer to my house to teach me banking. I learnt as much as I needed to know. After promotion as general manager, I was posted to Kolkata, which was considered a sort of a dumping ground for executives. In fact, Kolkata turned out to be my best posting.

ML: Which year was that?

AKK: It was from 1997 to 2000. It was, indeed, a tough posting but I was determined to make a difference. My style is to generate an agenda from the people. So I called the senior managers and told them that Kolkata’s image is that of an amputated leg in a corporate body. It generates barely 4%-5% of the total revenues of the Bank and, therefore, the management was not interested in Kolkata, if it continues to cause problems. So is there any one thing that we can focus on to improve performance to make the management take notice of Kolkata? After discussions, we zeroed in on growing the savings accounts base of Kolkata and we achieved unprecedented growth.

ML: How did you do that?

AKK: I found that the existing branches were over-staffed; they did not care for customers and did not allow computerisation. I persuaded the unions to accept computerisation and promised to open new branches. We opened seven new branches and they were all a huge success. There was such a rush of customers that even the union leaders who rarely worked were busy counting cash. Photographs of these events were sent to the house journal. I also solved some of their pressing HR issues and complaints about delays in processing provident fund claims, medical claims, etc. I sent a person to the head office to especially clear the backlog of personnel issues. So, I helped build trust with the employees. At the same time, I started making business presentations to them about the performance of each branch and the staff situation. I set up a business development committee that included union leaders and worked with them to find solutions. The advantage of this was that they stopped creating roadblocks, even if they did not help in developing new business. Then, Kolkata had a record 58-day strike in the 1980s on the grounds of rotating people from one branch to another. After six months of intense negotiations, finally, on one single day, I managed to effect the job rotation of around 800 people in the local branches of Kolkata. I was sitting in my office till 11p.m. to oversee the implementation. I believe that people from West Bengal are intelligent and you need to articulate issues to them. In fact, I used to tire them out by talking rather than the other way round. But I also had the reputation of being an open man who could take criticism but I would never compromise on performance. I did not confront the unions, but worked through a process of engagement. When I went to Kolkata, employees used to bring out a small publication called BOBSAGA, which contained all kinds of virulent gossip and criticism of the management. I countered it by bringing out another four-page publication called The Eastern Spirit which covered the message of great leaders of the East known for their service to humanity and also lots of knowledge inputs on banking, achievement of employees in different fields and challenges. It was very satisfying to find that The Eastern Spirit became very popular with the employees and BOBSAGA stopped coming out. If I have this job today, it is because of my performance in Kolkata.

ML: How was your tenure as ED?

AKK: My tenure as ED was a mixed experience. At one level, it was a huge training for me, especially at board level. At the organisational level, it was full of action and anxiety. I introduced a number of changes to structure HR in the context of environmental changes. One such change was the introduction of HR audit. We also brought about Gartner, a world-renowned consultancy firm to advise us on technology.

ML: Why then was BoB a laggard in technology till 2005?

AKK: Changes are never smooth, especially in such an unstructured legacy-driven IR environment. There was huge resistance to both these changes and a lot of time was wasted in managing this. On hindsight, I can say that it requires clarity of vision, personal guts and unwavering resolve in leadership to pilot transformation. Whenever these are present, it can transform the organisation. I learnt a number of lessons during this tenure and, when I became CMD, I used this learning to pilot many changes. The journey has been turbulent, but very satisfying.

ML: What are the challenges you faced as chairman?

AKK: As chairman BoB, the issues were very different and I had to reinvent myself for this job. The advantage was that I knew the Bank and the officers and their strengths and weaknesses. Also, I came with a reputation about being a no-nonsense man. I also knew exactly what I had to do and the rest is evident. We should be doubling the size of the Bank in three years; we have built a new brand identity and image. When I came, we had not even signed a technology agreement for implementing new technology in the Bank. I sign a Rs800 crore agreement within the first four weeks of my taking charge as CMD. Today, those banks which were ahead of us have fallen behind. We have over 1,300 branches under Core Banking and 85% of the business is online. The number of ATMs has increased from 150 in 2005 to 1,100+ today. Our people have really worked hard.

I also unleashed a major HR reformation exercise in the Bank. I launched three initiatives: Sampark – a helpline for employees right from my desk, Paramarsh – a counselling service for employees, and Khoj – a programme to identify and develop talent. I thought, suppose someone in Purnea in Bihar has a personal problem, where does he go? I said he could write directly to me in a specific format and I will react immediately. It is amazing the kind of tragic issues that I have to deal with. One case came from a manager in Ahmedabad who had lost his son in a road accident and wanted to be relocated with his family which was traumatised. I wrote to the regional manager to make sure he was relieved before sunset. Most recently, an employee wrote to say that he had taken an education loan for his son and just 15 days after he got a job, the son died in an accident. He pleaded for the interest waiver, at least. I did it immediately. These initiatives have restored the confidence among employees. I have also posted trained psychological counsellors in large cities – they deal with issues of suicidal tendencies, marital issues, problems with children, etc. The Khoj initiative has identified 1,000 people who are being trained for various new initiatives in retail, wealth management, corporate credit, treasury, etc. I have also started a “Baroda Foreign Service” to train managers or our overseas branches. Today, I am proud to say that we have pioneered many innovations – 12-hour banking (500+ branches), 24-hour banking (nine branches), retail loan factory, SME factory and have positioned ourselves as a multi-specialist bank. The entire credit goes to my management team and employees.

ML: Even your re-branding was not without controversy, wasn’t it?

AKK: Even the re-branding of the Bank was not without its set of problems. Some people tried to create unnecessary controversy about the orange colour in our logo. I then explained that our colour represents loyalty and is a 5,000-year-old colour and is also a part of the national flag. Fortunately, the issue blew over, but not without causing a lot of tension. In fact, some people even tried to use the issue to gun for my job. Ironically, today the re-branding of Bank of Baroda has been lauded by everyone and fetched us several awards. It has even triggered off similar re-branding exercises in some other public sector banks. At Dena Bank, I was the first person to introduce the ‘brand ambassador’ concept in a public sector bank. We had Juhi Chawla, then a very popular film star, as our brand ambassador. Even at that time, some people complained about this. I do believe that when you do new things, there is likely to be some resistance. As a leader, we have to effectively deal with such issues. Frankly, I could do all these things because I always think of how things can be done and am willing to be a little contrarian and take risks. My philosophy is that of ‘tough love’ -- tough on performance and compassion for employees.

ML: You have sent a similar signal about consumer service quality, right?

AKK: Absolutely. I don’t believe in fake pep talk. I believe that human beings can be great assets as well as great liabilities. When I took over, I asked myself what I could do to make things better for the customer. I then issued a circular which said that I will be tough; ‘If you make a genuine mistake leading to a loss, I will stand by you, but any mishandling of customers will be treated on par with financial irregularity. The circular alone has no meaning, unless I could translate it into action in a few cases. So I decided that I will take personal charge of three functions, which will not be delegated – customer complaints, human resources and marketing. I am not a transaction man; I believe in pursuing a transformation agenda. Otherwise, I will be doing more of the same thing. Creating vision, galvanising human effort and creating long-term value for the Bank is essentially a CMD's role apart from interacting with other key actors in the system like the regulators, government, clients, etc. In the process, I sometimes have to prompt customers to give us their feedback and opinions. Indian customers are most reluctant to complain. If you call a customers’ meeting, they will tell you that the bank is good, the staff is excellent and how they have grown with the bank. I then tell them, “But I am not happy with our service standards. I also receive a lot of complaints on email and by post from customers who are not happy with us”. Initially, this startles them; but they slowly begin to open up and point to areas that could do with some improvement. I like complaints, because we cannot improve, unless we get feedback and act on it. When we brought in Rahul Dravid as our brand ambassador as part of our major branding revamp, our advertising slogan was sub kuchh badal raha hai (everything is changing). I received a letter from a customer in Dubai who said, “aap ke Dubai branch me kuch nahi badal raha hai (nothing is changing at your Dubai branch). How we have changed the Dubai operations is now history. This being our centenary, our slogan is “100 years of banking with passion”; a lady customer wrote to say, it is more like “100 years of banking with patience” and proceeded to give us her complaint. There was this customer who said he had sent in an application for Net Banking three months ago and the facility had not yet been activated. The manager was simply sitting on the application. I asked the regional manager to go to the branch to verify if this was true and, if found correct, to suspend the manager on the spot. I received a call to say it was, indeed, true but it was because the branch was short-staffed, otherwise the officer was very sincere. I refused to accept that reasoning. A suspension does not mean that we remove people from their jobs; it is usually for a few days or a month or so and is meant to send the right signal. It is exactly such delays, rudeness, sloth and apathy that create a corrosive environment in organisations; there cannot be any compromise in this regard. Today, the message has gone across the Bank that we will not tolerate mishandling of customers. I am not saying our Bank is perfect, but I believe that after pursuing our corporate philosophy consistently, there has been a dramatic improvement. Improving customer service is no rocket science; all it requires is common sense and I am practising common sense. I do not want my customers to face any deficiency in service that I would find personally unacceptable. Also, for every customer who complains, there are actually 20 others who are angry but are not able to complain. I am happy that the level of customer service in the Bank is far, far better after fixing accountability and we have also taken proactive steps in training employees about new products and technology and I now see that they are highly motivated.

ML: What next? What else do you have on your agenda for improvement and how much longer do you have at the Bank?

AKK: I retire in March and the very next day I am only a customer. In a running organisation, there are always things to do. There is a lot to do on the HR side as yet. We have started the process of grooming 300 leaders for the future. The process has to mature. I believe intangibles will create tangibles in the future and, unless you have a brand and a reputation as a customer-centric organisation, you cannot create something of lasting value. An organisational journey is that of a long-distance runner not a sprinter.

ML: What about your own future plans? Having spearheaded massive change with such passion, will you be able to walk away from it all?

AKK: Yes, I will. I have a disengaged mind and I have always considered myself an academic. So I will probably go back to teaching or something that excites me. Generally, academics are not power-hungry, but who knows, this job may have corrupted me intellectually (laughs). People are perquisites in the public sector – you don’t get money in the public sector but you get people to do things for you. Personally, I plan to write my memoirs, because there is so much to tell and to share. I have read the autobiographies of so many corporate leaders of the West, but they worked in a very uncomplicated environment. In the public sector, you work in a very complex environment. As leaders, we live through a life full of excitement, passion and also fear -- fear of failure, fear of accountability.

The quest and conflict for an individual is between ‘becoming’ and ‘being’. Mine has been an eventful journey that started with a two-year contract in the Bank in 1980. The fact that I have become chairman proves that there is room for people like me in this system. I don’t know what will happen ultimately, but my desire and ambition is to do something that involves building human resources, teaching, coaching and writing. It has already been a long journey and I am quite satisfied with how it has turned out.


We are listening!

Solve the equation and enter in the Captcha field.

To continue

Sign Up or Sign In


To continue

Sign Up or Sign In



The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)