Next Change

Bajaj addressed employees at Chakan, telling them for the first time what business circles have been speculating for long8212;that subject to the Board8217;s approval he will step down as MD on March 31, 2005, and that he will pass on the baton to eldest son Rajiv; and that Sanjiv will be elevated to the Board this October.

Chakan is symbolic of the 8216;8216;new way of doing things at Bajaj8217;8217;8212;not least because Rajiv had to fight hard for it. He argued with his father for three months to allow him to set up the plant in the first place 8216;8216;when 500 acres were lying unused at Ahmednagar8217;8217;. Chakan is barely half an hour from Akurdi, the Bajaj Auto HQ which has a manufacturing plant too.

Rajiv infused Chakan with fresh ideas, like putting in place an R038;D team who designed the Pulsar and now the K60, hiring workers on contract, increasing productivity by imbibing Japan8217;s famed TPM Total Productive Maintenance culture.

Result: Chakan aims to produce 25,000 K-60s per month within six months. In the range of 125-135 cc, the K-60 is going to be priced at the upper end of the executive segment, which is lorded over by Hero Honda.

Chakan8217;s worked and his father is the first to admit it. 8216;8216;All credit goes to Rajiv for sticking with it and it turns out he was correct.8217;8217; For the younger Bajaj, the Pulsar is more than a flagship motorcycle. 8216;8216;Its success is not lost upon our other engineering divisions, manufacturing plants and vendors. Success breeds success, and this new way of doing things is already pervading the entire organisation.8217;8217;

The MD-in-waiting says for Bajaj to grow profitably, it has to be ahead of the market with 8216;8216;smart ideas8217;8217;; and with the arena becoming extremely competitive, it8217;s imperative 8216;8216;for Bajaj to be a place where individuals aspire to build the best motorcycles in the world8217;8217;. As for Sanjiv, in charge of finance, he wants the company to regain the top slot in the two-wheeler segment they lost to Hero Honda. Things were particularly difficult in 2000 when scooter sales fell dramatically8212;and Bajaj Auto had to do or die.

But today, the strategy is in place8212;expand Bajaj Auto8217;s footprint outside, and adopt lean manufacturing practices, including cutting costs and labour.

The worldwide market for two-wheelers is 32 million, and Bajaj Auto8217;s share is a mere 1.3 million, 8216;8216;so there8217;s immense scope for growth.8217;8217; One way is to set up bases in other developing countries to address the world market.

The first stop, says Sanjiv, also in charge of international operations, is Indonesia, where an assembly line will be set up by the end of this financial year.

He hopes that the Indonesian experience will help the company go elsewhere, like Brazil, for example, in two-three years. 8216;8216;About 25 pc of our sales come from Peru, Guatemala, Colombia etc.8217;8217;

With three more launches planned this year, including two scooters, a revamped Chetak and Wave, which will use digital twin spark ignition technology Bajaj has patented8212;and a whopping Rs 108 crore allocated for equipment and new product development, the Bajaj Juniors do seem to know what they are doing.

So, how are the changes affecting Rahul Bajaj, who ruled the scooter world during the licence raj? How difficult is it to give it all up? 8216;8216;Times have changed since I became CEO in 19688212;and it will be disastrous if I don8217;t put the company in competent hands,8217;8217; quips Rahul Bajaj. He admits that the 8220;fire in his belly is now extinguished8221;.

8216;8216;Now, the fire is there to take on politicians, to represent India abroad and take on anything that is going wrong in India 8212; like Maharashtra8217;s proposal for 52 pc job quotas in the private sector.8217;8217; Come April 2005, that8217;s the role Bajaj senior will play.