Thermax directors quit, major overhaul on anvil

JULY 21: Thermax Ltd is looking out for a new CEO. Anu Aga, chairperson of Thermax Ltd, is going for a major overhaul at Thermax Ltd by to...

JULY 21: Thermax Ltd is looking out for a new CEO. Anu Aga, chairperson of Thermax Ltd, is going for a major overhaul at Thermax Ltd by totally revamping the board and restructuring operations to turnaround the fortunes of Thermax, which has been hit by losses.

Aga was speaking after all the executive and non-executive directors resigned from the Thermax Board at the board meeting held here today. Aga said it would take a while to reconstitute the new board at Thermax and the company would be looking of suitable candidates outside. "The well being of Thermax is our paramount concern. We have to improve our lacklustre performance and regain the vibrancy we once enjoyed," Aga said. Over the last three years Thermax’s profits have eroded and in year 1999-2000 the company made substantial operational loss.

Those who resigned today included Abhay Nalawade, MD and CEO of Thermax Limited, Meher Pudumjee and Pheroz Pudumjee (Aga’s daughter and son-in-law), M J Shaikhali, Girish Trivedi, R V Ramani and Dr N D Joshi.

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Nalawade has been replaced by Prakash Kulkarni, who was joint managing director of Thermax. The new MD, Kulkarni, could be one of the candidates for the CEO’s job, Aga has indicated.

Aga also said she would bring back Meher Pudumje and Firoz Pudumjee in the reconstituted board but they will not be executive directors. All the executive directors who had functional responsibilities will retain their responsibilities. Aga remains on the board along with the new MD, Kulkarni. The non-executive directors B D Chansarkar, B M Desai and S S Marathe will also continue till the new board is reconstituted.

A total revamp of the board was the major recommendations made by the Boston Consulting Group. BCG was appointed three months ago to take a detailed look at the company’s business portfolio, business processes and organisation structure. To implement the company-wide changes, the Board has extended the term of BCG by another six months.

Thermax will now concentrate on its core businesses of energy and environment where it has inherent strengths and the potential for substantial growth and returns. It will promote entrepreneurial skills within the company and revive its reservoir of talent to experiment with new ideas in its core businesses.

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Under the new proposed structure a leader with a team will manage each business unit. The leader of the business units will form the executive council which will be led by the managing director. Besides, the unit leaders, the council will have leaders of some of the corporate functions. Instead of the old style barriers between divisions, in the new scenario process teams will work across businesses to improve business processes such as supplier coordination and customer service.

With a sharper strategic focus and realigned organisation, the company is hoping to improve its bottom line on a sustainable basis.