Pawan Goenka, Ph.D. Med. And the CEO of Mahindra & Mahindra, will retire after more than two decades at the company. Goenka has led the company through many significant decisions and changes, including the launch of products such as Thar, XUV 500, Scorpio and Bolero, as well as a number of new joint ventures and investments. In an interview with BusinessLine, Goenka talks about her journey. Excerpts
In 1993, you left Detroit and joined Mahindra. Why did you move to India then?
I saw an ad in an Indian newspaper in the US. The Indian automobile company invited Indian engineers to return home. I wanted to throw that paper in the trash, and then all of a sudden I looked at it and asked my wife, “You see this, shall we?” and she said, “Let’s do it.” It took us several years to convince ourselves that we should return. But that commercial got him started. Around the same time there was this ghazal of Pankaj Udas, ‘Chitti ayi hai’ (the letter arrived). And that was touching for every Indian who lived outside of India.
And at the time, honestly, we didn’t worry too much about how much I was getting paid from what I was getting in Detroit or where I was going to work, who I was going to apply to, what my career path would be. At that time it just happened, the Indian car industry is opening up, there is a place for someone who can come in and be able to change something. I would have to admit that when I first went to R&D Nashik, I got a chill. I wondered from here, will we really be able to compete with the big boys? But that’s what made it so challenging. And I got a blank check from Anand Mahindra to put everything in its place.
You have led many changes in M&M. What did you really manage to do?
The time I moved here was perfect. Because in 1993, the Indian automotive sector and the Indian economy opened. Mahindra was one of the companies that decided we weren’t going to play another fiddle, we were going to invest in research and development, invest in a product and really be up there so we could play and parry with the big guys. So, if I had returned in 1989-90, I would probably have been disappointed and come back. And if I had come back in 1996-97, maybe it was too late, maybe someone else would have sat there and done what I had planned. My arrival in India and Mahindra’s decision to invest in research and development, the growth of the Indian automotive sector, it all happened together and that’s why my time went perfectly.
You’ve led a lot of innovation at Mahindra over the last 27 years. Which of them would you consider to be the most important to read personally on your trip?
There is a place for everything. It is clear that Scorpio is a product that achieves maximum eyeballs in terms of what has transformed Mahindra. If you look at which product sold the most, it’s Bolero. Then, if you look at which product actually created Mahindra, you move towards the value chain, that’s the XUV 500. And if you say which product probably made the maximum profit for Mahindra, that’s probably a pick-up. But for me the answer is the XUV 500. Bolero was actually an experiment, an experiment we had no idea about it would pay the kind of dividend he gave. And since we invested very little in Bolero, even if the product failed, it would make no difference.
Scorpio was obviously a big bet. I would say we were nervous and didn’t know what success would be. Whether we will succeed in selling 1,000 vehicles, 2,000 or 5,000 vehicles, we did not know. But by the time we got to the XUV 500, we had somehow already established ourselves. Back then, it was about proving that we weren’t just lucky with the previous Scorpio or Boler, that we could constantly develop winning products and move toward the value chain. So maybe I was more nervous about the XUV 500, because it was a test of our consistency, not just a correction.
Your critics say you’ve tried to stretch too thin and try to stand out in more areas. Do you agree?
I would first begin by acknowledging that the critics are not entirely wrong. Maybe we did too many things. Perhaps the success we have achieved in many things has made us bolder and more adventurous to enter into many other things. Maybe we’d decide not to do a couple of things and that we could do the things we did a little better. And in a sense, that’s what we’re doing now. By getting out of a few things and getting closer to our core and ensuring that we are able to justify ourselves to those things. But if you were to ask me when we did it, does it make sense? My answer would be very emphatically yes.
One of the things that went wrong is Ssangyong JV. What happened here?
This is a very sensitive topic. In the next few days we would know whether the investor will apply or not. Everything we have said about why Ssangyong is the right thing we should have acquired, I will continue to stick to each of those statements. It was a perfect marriage. If I went back to 2011 and knew what happened in the next 10 years, and started over, I would do many things differently.
Where would you like to see Mahindra a few years back?
The best of Mahindra is in front of us, not behind us. And what will define the best of Mahindra is how Mahindra is seen outside? In two years, our market share in UV returns to 20 plus. And if the three products we have – Thar has already succeeded, and if the other two (Z101 and W601) have a similar fate, then we will arrive.
Another thing that needs to change is that many of our international subsidiaries are turning now. If (in) the next year or so, we can clearly show that the worst is behind us now. So I think in a year or two we will have confidence that people from outside will see that Mahindra’s international subsidiaries, especially with Ssangyong, are an addition of value. Once you achieve that, we can move on to a more aggressive type of initiative to take the company to the next level of growth.
What’s next for you personally?
It is clear that you are not tied to one, and explore many different things and experiment with things. Currently the most exciting for me is the engagement I have with the Government of India. And it is a very exciting project and allows me to apply my experiences in the last 40 years in the automotive and tractor industries, and to apply them to many other industries that have not quite achieved the same level of atmanirbharata. I want to keep a third of my time for myself and my family.