Episode 26

Conversations with Business Leaders: R V Gumaste, Managing Director, Kirloskar Ferrous Industries Limited

Category :  Leadership Paradigms

Let's hear from Mr. R V Gumaste, MD, KFIL about how they sustained the innovative pull-based flow processes in manufacturing and new product development for 7 years without any violations.

We discuss what challenges did they faced in implementing and sustaining the new processes.

Transcript

Hello and Welcome to Counterpoint Podcast, we are here in another episode from the ‘Conversation with Business Leaders’, where we hear from the CXOs about the transformation journeys that them and Vector c g charted out together . We are joined by Mr. R V Gumaste, managing director at Kirloskar Ferrous industries Limited and we are going to discuss challenges, learnings and results that came out from implementing flow processes in manufacturing and NPD.

So let’s hear from him. Hello Mr. Gumaste, welcome.

Shubham Agarwal : Can you briefly introduce KFIL
Mr. R V Gumaste : Kirlosker Ferrous Industries Limited is well known name in the area of automotive castings and also for the raw material pig-iron for the foundries and now we are one of the largest foundries in India, catering to all the OEMs in the field of automotive manufacturing, also tractors.
Shubham Agarwal : What was the motivation behind adopting TOC flow processes in KFIL
Mr. R V Gumaste : I think it was seven- eight years back, we started the process of implementing theory of constraints processes in KIFL, both the plants that time Koppala plant, as well sulapur plant. You know what was very important is what is key to customers and what are the customers real challenges or what are his problems? .. . And with that focus, when we talk to vector; theory of constraints was one of the best possible ways, we could improve our supply chain and with that, we took up the journey and we tried to address two important aspects of our customer concern. One was the supply chain in terms of how we can ensure on time in full, the other was new product development cycle time with again, the TOC method of how we can bring quick or faster new product development
Shubham Agarwal : Can you share the results of implementing these flow processes in manufacturing and NPD
Mr. R V Gumaste : we were prepared for bring this change in the organization, become a different foundry or a different organization compared to anybody else in the industry. So, with the experience of what was done in kirlosker oil engines, we decided that it can improve our supply chain to our customers and started implementing and definitely it was not just implementing a system, but it was bringing change in our process bringing change in our mindset and overcoming the apprehension whether it will really bring a change or not. I think it was a good surprise, good experience for us. That, you know, very basic three concepts, saying that we work with the full kit, No multitasking and daily review. And also saying that this supply chain requires some buffer creation to ensure that we don’t fail on our commitment or customers. And when we worked with this principle for all customers, from both the foundries, it took us some time. We had to work for a couple of years on this concept but we could bring a change. (Super: Production from the existing facility increased by over 30%. )We could start delivering on time in full (Super: Customer On Time Delivery became 100% on a daily basis even after the OEM changes its plan.). We could get the customer appreciation that, you know, there is a significant and noticeable change in our supply you know performance. The other one was related to the new product development. One is the process itself. And again, you know it is not one customer’s number of customers number of castings to be developed because technology change was happening from Euro or Bharat, based three euro 3 to euro 4and then euro 4 to Euro 6 and a lot of casting development. And we as an industry, we were known to take like six to nine months to develop a cylinder block or a cylinder head. But we decided that we make want to make a major shift. Make a major change and once our mindset changed, thinking opened and everybody wanted to ensure that they also can make a change. And we also in the due process, decided to upgrade our technology in the new product development area of casting making foundry technology. And we decided also to go for 3Dprinting to print the course, so we can. And today we have that capability, we could make the course by 3D printing without making the core boxes. Which really brings down the time substantially. And we could cut down the development time from like 9 months to straight away to two months and we could also develop in case of emergency requirement of our customers, we could develop the parts in 30 days or even 20 days. And recently, we made it in four days (Super: before: 9 months ; After: 20-30 days ……. 4 days).
Shubham Agarwal : How did market/customers and competition react to your performance?
Mr. R V Gumaste : ….Not only, we brought a major change and we cut down the new product development, cycle time, but we change the mindset of our organization and we also I think to a great extent change the mindset of the industry because we started offering that we can develop the parts faster than whatever customers look forward to develop these parts.
…This kind of capability improvement in us readily brought, say change in our customers, looking towards us and many places customers were very keen and once we were part of them, we could definitely increase the share of business entered as 30 percent supplier, but could go 50 or even 70 percent and today most of our customers very large business is single source- 100% share of business, (Super: KFIL single source supplier to most customers) so, I think qualitative improvement, delivery performance, new product development made a big change
Shubham Agarwal : You are one of few companies who have sustained the TOC processes for more than 7 years. How did you make it happen?
Mr. R V Gumaste : We wanted to revamp the way we think we plan and we work and we not only that each and every senior leader of the organization got involved. But we ensure that this implementation is from the shop floor and it’s done as not a supplementary process, but we replace the system in the process. The planning process itself was replaced to TOC and when we started getting results, we started getting comfort. And not many people not many customers keep on talking to us every day for delivery, but the system speaks and they get communication and we could really see the comfort what we derived in implementing this thing that itself was a great deviated to continue this system and make it part of our daily routine and also ensure that it is a continuous process and gets continuously implemented and improved and not as a one-time activity. And it’s also very important that our organizations are system oriented not just leadership drive oriented. I think this is the most important aspect we have tried and another very important aspect is, we have learned a lot working with our customers. Whether it is highly demanding domestic customers, Indian customers or also the European and outside customers. Automotive customers are one of the highly demanding customers and their first demand and the foremost demand is we should work to systems and we should follow the SOPs and procedures. And I think this kind of alignment with TOC principles, not only helped us to completely revamped, achieve the process alignment. But it’s also the results what came kept motivating us to work with these systems.
Shubham Agarwal : Why do you believe the growth trajectory you are on is sustainable?
Mr. R V Gumaste : …as industry is going for a change and we have our own constraints or our own apprehensions. With respect to how much to develop the foundries. Is EV going to come and if it comes what happens to the engines, what happens to the blocks. Many questions are there and there are proponents up on the both, the sides that it will take some more years and on the other side no some more years are very short and electric is a reality, yeah, we are looking at lot of aspects, not that we just jump and go onsetting up the foundries. But from one foundry 10 years back we are now setting up the fourth foundry. So, it has been a tremendous journey. We had a capacity of just 40,000 tons of casting per annum 10 years back, and we are now increasing to 200,000 tons, that itself speaks that, you know, customers have tremendous confidence on kirlosker industries and we are also continuously striving to again and again understand what is critical to our customers, what is important for our customers and how we ensure that we are best or we are good in doing what is required by our customer. It’s not one time activity, it is continuous improvement what we need to bring and we have to successful in bringing that change. I think we have been able to do little and that has improved the confidence of our customers in kirlosker and we continue to grow we are continuing the our growth at about, 15% year on year. I think that itself speaks of you know, confidence of our customers in us.
Shubham Agarwal : What is the next for KFIL?
Mr. R V Gumaste : I think as you have seen recently, we had a Brand launch, new brand launch and you must have seen. We have moved from enriching lives to we have moved on to limitless. And for us limitless means. You know, limitless opportunities, limitless capabilities and limit less progress we can bring, I think we would like to live by that.
there is a tremendous opportunity for us both in iron and steel segment as well as the foundry and casting segment sectors. And we look forward that we really make use of what progress we have done in creating the quality capacities to look forward and really move ahead into the new technology area. Whether it is as I just mentioned, 3Dprinting, new product development and working with our customers to bring the required changes to go Euro 6 and even beyond and face the challenge here for electric phase, the challenge of digital age. What we can do with the Internet of Things What we can, how we can digitalize our processes, how we can create digital twins for our blast furnace or cocoa one or centre plants there are plenty of things in pipeline, but what we are looking at is, how do we really create value for all our stakeholders?, I think that is the key thing
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