34 | AutoPartsAsia | NOVEMBER 2017machines and cutting tools come into
play; new technology has reduced
shear die cutting time and increased
the speed. It involves much planning,
but the result is clear efficiency at
the front-end,” he said. At least 50
percent of the suppliers would now
be working on some kind of modular
approach; Mahindra helps them test
new products on their vehicles. Sikka
said that “we can do a few seeding
batches, we can use our validation
labs; we can do all that, but the R&D
effort has to come from the suppliers.”Design In India
According to recent SIAM data only 10
percent of the vehicles are designed in
India, especially commercial vehicles.
Speaking about the changes from
the vendor management point of
view, when the percentage of vehicles
designed in India grows, Sikka saidthat ‘Make in India’ should always be
accompanied by ‘Design in India’. He
affirmed, “Mahindra has taken the lead
in doing so; we have our own design
studio in Kandivili, absolutely state-
of-the-art. We have a very large R&D
facility in Chennai called ‘Mahindra
Research Valley’. No other OEM in the
country has that kind of a facility. We
have 2,500 engineers working there
and we are designing all our products
now in-house. Of course, we are
always working in close collaboration
with some of our foreign partners on
that side, but clearly ‘Design in India’
is extremely critical, because that’s
where you add value. India has to
move up the value chain of designing.
And if OEMs have to move - OEMs
alone cannot move - the suppliershave to move with us. Some of them
are on the move and others will be
forced to follow; everybody has to
move in tandem.”Regarding the template for vendors to
operate in volatile market conditions,
Sikka said one template that they
are creating is to get the suppliers to
participate in various segments of the
business as each section will have to
go through seasonal cycles of ups-
and-downs; that’s bound to happen.
Some of them supply only to tractors;
Mahindra wants them to do for trucks
also. Something like multi-scaling
because every supplier should go up
the value chain. He said at least 50-60
percent of their 300 core suppliers
cater to different segments.
Most OEMs in India support suppliers
only in terms of technical skills -
quality, process, poka-yoke. Whereas,
Mahindra has
a separate
team which
helps suppliers
manage their
strategy, HR
processes,
soft skills and
managerial
ability.
They have
created this
in the last five
years - separate
technical and
management
teams. They are
involved in HR
because some
of their suppliers
were running
attrition levels of
close to 25-30
percent.
Information exchange between
management and workforce should
be aligned to ensure that quality
parts come out of the assembly
line. Sikka agreed, but said efficient
communication is always a challenge
as everything has to be communicated
down the chain very clearly,
transparently and to the point.
He stressed that there are issues in
productive communication; even
data exchange sometimes creates
problem. Mahindra now uses a
single website to communicate with
suppliers.
On PPM levels evolving in the next
10 years, Sikka claimed, “PPM levels
are no more a problem. We have
reached a level where we will keep onimproving. Tier-1s have good quality;
the concern is on Tier-2&3 suppliers,
who are not exclusive Mahindra
suppliers; they are common with other
OEMs. We are focusing on them and
now have a programme to create
clusters of good quality Tier-2&3
suppliers. It is more like an industry
approach; we are working very closely
with ACMA, to help it play a leading
role in this.”Sustainability Is Profitable
Sustainability for Mahindra is not
just a slogan, he said. The company
believes that sustainability can be a
very profitable and social business
strategy. Mahindra was the first in
the country to announce a prize for
controlling carbon emissions.
Besides, it was the lead-sponsor for
the EHS (Environmental Health and
Safety) Plus centre in Pune, where
its suppliers can go and get trained
in sustainability practices. This has
been done in collaboration with the
Symbiosis Institute where Mahindra is
an anchor donor. It is a full certificate
course to train the suppliers.
Sikka feels sustainability is the key to
transform the industry. He affirmed
that “as a large, responsible OEM, it
is up to us to enlighten our suppliers
that sustainability as a practice is
absolutely mandatory. The supplier
will have to do what we ask him to do.
He may take a couple of months to
implement the policy, but he will have
to implement it.”An example would be in the use
of LED lamps. All lightings within
Mahindra facilities have been changed
to LEDs. The company has ensured
that the LED supplier offers the same
price to Mahindra’s vendors since it is
a huge saving with a payback period
of less than one year.
For electric vehicles too, the sourcing
is handled by the team under Sikka as
part of the company’s ‘One Source’
initiative. He emphasised that the
teams are working hard to achieve the
goals set by the Government of India,
to make electro mobility by 2030.
His plan is “to work on a ‘partnership’
approach with our suppliers so that
we are always industry-oriented. We
help suppliers move up the value
chain in terms of helping them get
some collaboration wherever we can
play the role of a facilitator. We will
work with them on long-term business
commitments; we don’t believe in
changing suppliers for short-term
gains. That is the foundation of our
strategy.”COVER STORY