He may be Japanese by birth, but his style of functioning — through empowerment, interactions, taking suggestions and constantly communicating with the large work force — is rooted in deeper understanding of human values. Kenichi Ayukawa, a 37-year veteran of Suzuki, has helped India’s largest car maker Maruti grow in stature, size and revenue in just under four years. CEO and managing director Ayukawa is truly a driving force behind Maruti. His regular interactions with union and workers, and his drive to invite suggestions have paid rich dividends to the company. In FY16, around 7 lakh suggestions were received from employees leading to a potential saving of over Rs 280 crore, says the company’s annual report.
No one can forget the circumstances under which Ayukawa took charge. On 18 July, 2012, rogue workers went on a rampage in Maruti’s factory in Manesar that resulted in the death of a HR executive and injuries to over 100 workers — both Indians and Japanese. The disputes were attributed to issues involving wages and better working conditions. For one full month, there was zero production of cars resulting in delays, losses and loss of business for Maruti. Ayukawa was sent by the board to handle the situation. By April of 2013, Ayukawa was made the CEO. He maintains that in a manufacturing company, labour relationship is a very critical component of management-worker relationship. Ayukawa attributes his ability to interact and communicate with people well to his early years at Suzuki’s HR department.
According to Maruti chairman R. C. Bhargava, the success of Ayukawa lies in his ability to absorb and learn quickly the way Indians think and decide. For the financial year ended 31 March, 2016, exactly three years after his appointment as the CEO, Maruti had 47 per cent share in the passenger car market with record 33 per cent increase in sales to Rs 56,350 crore and 91 per cent jump in net profit to Rs 4,571 crore compared to FY13 numbers. Bhargava believes Ayukawa has set the base for Maruti’s future growth in India of producing 2 million cars by 2020 and launching over half-dozen new cars by then.
On Ayukawa’s watch, Maruti has launched Nexa — the new premium sales outlet network. It is spending big moolah on Nexa and launching premium cars such as S Cross, Baleno and Ignis. Nexa is contributing virtually 10 per cent to the overall revenue of Maruti, and Ayukawa is confident that its contribution will only increase in coming years. “Through Nexa, we are challenging something that we have not done,” he said recently. Nexa is lending the ‘cool’ factor to Maruti, which is otherwise often considered as a small car player or the first-car purchase option for a buyer. Ayukawa sees the new Suzuki plant in Gujarat as a force multiplier to Maruti’s production capacity going forward. The plant is expected to roll out cars within February 2017. But when asked whether Maruti will be able to stick to its ambitious double-digit growth path in 2017 and 2018, Ayukawa said he was hopeful but acknowledged the current market situation as “tough” and “challenging”.
BW Reporters
Ashish Sinha is an experienced business journalist who has covered FMCG, auto, infrastructure, tourism, telecom among several other beats. Ashish has keen interest in the regulatory scenario impacting different sectors. He writes on aviation, railways, post and telegraph, infrastructure, defence, media & entertainment, among a wide variety of other subjects.
