Atul Sobti can see the first green shoots of recovery in the power sector after the less-than-pleasant experience of the past two to three years when growth took a hit due to various issues on the supply and demand sides, the inadequacy of fuel and land, delays in obtaining clearances, and funding challenges. All these factors dampened the interest of developers and investors in new projects. Sobti, currently chairman and managing director (CMD) of Bharat Heavy Electricals Limited (BHEL), attributes the upswing to various government efforts. He hopes that its latest scheme, Ujwal Discom Assurance Yojana, which is aimed at improving the financial condition of discoms, will have a positive impact. “Within two months of unveiling the scheme, 15 states have agreed in principle to join it. This is very encouraging. Ordering activity in the sector has already picked up, although led by the government sector,” he says.
As the leader in the power equipment sector, BHEL will continue to offer more energy-efficient, fuel-efficient and environment-friendly technologies to its customers. To expand its offerings, BHEL continues to add new equipment and capabilities to its portfolio. Today, the installed base of its equipment has crossed 160 GW. There is a huge service business opportunity to capture.
Sobti wants the company to focus on enhancing the share of the industry in its revenue mix. “We are working on many fronts to enhance our business in the transmission, transportation and defence segments. Solar is another big opportunity. With more than three decades of experience and strong manufacturing capabilities, we are placed very competitively in this segment too. We are further expanding our solar photovoltaic manufacturing capacity to garner a larger share in the country’s growth plans,” he says.
Sobti is a BHEL veteran. Prior to being appointed CMD, he was director on the BHEL board, heading power and finance. Earlier, he also held additional charge of the post of director, engineering, R&D. In addition, he is chairman of Raichur Power Corporation Limited, a joint venture company of BHEL and Karnataka Power Corporation Limited. Before joining the board in December 2013, he was executive director (power) at BHEL in Delhi and held concurrent charge of the Industrial Systems Group, a Bengaluru-based unit of BHEL.
A mechanical engineer, Sobti joined BHEL propmted by an awareness that the shortage of electricity and lack of access were holding back the country’s economic and social development. This fact is still reflected in the 300 million Indians who continue to be without electricity and in the dependence of rural India and parts of urban India on traditional fuels for cooking and other activities. “The cost of gathering them and the associated pollution impose a heavy burden on the economic well-being and health of people, particularly women,” he says. “A sense of purpose – the need to end the menace of energy poverty – was the main motivation behind my joining BHEL,” he says.
During his 35-year career in the company, he has worked in diverse segments. These include a BHEL manufacturing plant at Hyderabad, as well as the Corporate Planning and Development, New Capital Projects, and Project Engineering and Systems Integration divisions at BHEL Hyderabad and Bengaluru, and in International Operations where he made a key contribution to the company. During his tenure, BHEL enjoyed a fifteenfold increase in its overseas business, thanks to his success in securing and executing prestigious power projects and product orders in Oman, the UAE, Iraq, Libya, China, Kazakhstan, Suriname, Bhutan, Sri Lanka, Egypt, Kuwait, Ukraine, etc.
As a member of the New Capital Projects division in the 1980s, Sobti was actively associated with the setting up of new BHEL plants at Rudrapur, Varanasi, PCRI-Haridwar, Jagdishpur, Goindwal, etc. During his tenure in Corporate Planning and Development, he worked in various areas including strategic planning, capital investments, operations monitoring and technology licensing. He was also involved in drawing up BHEL’s corporate plans as well as creating a vision, mission and values for the company.
The slowness of projects and the general slowdown in the economy are issues that Sobti has been grappling with. With the power equipment manufacturing capacity of the domestic industry at more than 30 GW, he says the industry is fully capable of meeting the country’s requirement. “Unfortunately, around 30 power sector projects were stressed in the beginning of financial year 2016. This is the biggest challenge the industry is facing today, which is in addition to the shrinkage in demand due to the general slowdown in the economy and the sector. For example, during financial years 2014 and 2015, power boiler, turbine and generator project awards stood at less than 10 GW per annum as against 25-30 GW per annum during 2007-10. These two factors have resulted in the underutilisation of manufacturing capacities, locking of capital, and spiralling of project costs. So, the industry, including BHEL, is going through a very challenging time,” he says.
In his 35 years with the company, he has grown as a professional alongside the company’s growth. He has seen the company overcome the challenges of economic liberalisation, recession, cheap imports and a highly dynamic technology fabric. Last year, the company celebrated its 50th anniversary, but he likes to put it differently, saying that the anniversary was in fact a celebration of India’s success in achieving self-sufficiency in the indigenous manufacture of heavy electrical equipment.
With growth on his mind, Sobti wants to have a healthy order book by the end of financial year 2016. BHEL is working closely with customers, financial institutions and the government to fast-track some of the stranded projects. He is all too aware of the changed business environment that the company now works in: competition, globalisation, climate change, technology disruption and new regulations. These trends are replacing the traditional sources of BHEL’s competitive advantage, namely, market position, scale and legacy.
“I have set three priorities for BHEL. First, enhance responsiveness to the needs of customers, employees and shareholders. Second, strengthen the existing capabilities and build new sources of competitive advantage in the new scenario. Third, put in place drivers for sustaining long-term growth. I will be working relentlessly on these three strategic focus areas,” he says.
How does he get work done? “Someone rightly said, success is 2 per cent ideation and 98 per cent implementation. I too strongly believe in ‘execution’. In any strategy, the absence of effective execution is the single biggest obstacle to success and the cause of most disappointments – be it dissatisfied customers or disengaged employees,” he says.
But, Sobti cautions, a strategy is not executed by telling people what to do. It’s done by sharing the strategy in a way that everyone can understand and buy into it, and see how their jobs relate to it. So, he works closely with his people, irrespective of hierarchy, so that the decisions and actions they take are in alignment with the strategic direction of the organisation. In fact, his personal style of working was inspired, if only subliminally, by his father who was a great influence on his personality. “Within his limited resources, he imparted good education and values to all his three children. He always set phenomenal goals for us and we aligned our action with them. He taught us to think big and we all became successful professionals,” he says.
At home, his wife and their two sons have been supportive of his work. And at BHEL, he was fortunate enough to work with some fine leaders who saw more in him than he saw in himself and helped him to see it too. He says they led the way, showing him what he was capable of achieving.
Aside from steering BHEL’s growth, Sobti has plenty of other commitments too. He is an active member of the CII National Committee of Young Managers, the national-level CII Trade Committee, the Bangalore Chamber of Industry and Commerce, and the CII sub-group of R&D in Manufacturing. All these commitments mean that maintaining a healthy work-life balance is a challenge but a must. “I am a prolific reader and am fond of visiting places. When I am travelling outstation or commuting on Delhi’s busy roads, I mostly do catch-up reading. My professional requirements give me an opportunity to visit places with rich variety – right from the most modern cities to the most difficult places in the world,” he says.
Despite the challenges and pressures, Sobti would not trade in his job for anything. Working at BHEL, he says, is not just another job; it is contributing to nation-building. “Millions of Indians are touched by us directly or indirectly,” he says. “BHEL has excellent people, huge manufacturing capabilities and rich technical knowledge. The opportunity to efficiently use these assets and make a meaningful contribution to the lives of fellow Indians is a great reward.”