National Engineering Industries Limited (NEI), a part of the CK Birla Group, which manufactures the NBC brand of bearings for automotives, Railways and other industrial applications, has four manufacturing facilities in Jaipur (Rajasthan), Newai (Rajasthan), Manesar (Delhi NCR) and Vadodara (Gujarat) with an annual installed capacity of 150 million units. “We consider the world as our market and the biggest opportunities that we witness is the current quality and cost structures. Our success in the domestic and international markets is the result of our continued focus on research and development and investment in technology. We plan to double our sales and to invest more than Rs 100 crore in the next four years. We will increase our footprint through mergers and acquisitions or green field projects. Flexible approach, commitment to customer satisfaction and relentless quest for innovation help NEI deliver exceptional customer service,” RohitSaboo, President and CEO, NEI, told T Murrali of AutoParts Asia in an exclusive interview. The excerpts:-
Q: Your plant has already received the Deming Grand Prize? What else can motivate you to grow in terms of quality and volume?
A: NEI has always had a strong focus on quality. We have been ramping up our investment on R&D to become globally competitive. Gradually we have increased our annual R&D spend from 0.25 percent of the turnover to two percent. Our R&D headcount has also doubled in the last 3 years. Continuing its focus on R&D, NEI has also developed taper hub bearing. Further, to manufacture defect-free products, we have started to have dialogue with our clients. This is critical to design, develop and deliver products that are the best solutions to the customers’ needs and requirements. The first step in our product development process is to understand what the client requires. We have the capability to anticipate needs, develop products as per the needs and requirements of the different OEMs and industries.
Q: How is NBC perceived by the global companies – existing customers and prospective customers?
A: NBC’s manufacturing prowess boasts of a vast range of bearings that cater to diverse applications in automotives, Railways and other industries. We offer world- class technology to global customers and are nimble and flexible to meet the changing customer needs. Excellence in quality and precision performance serve as hallmarks of all products. Our responsive design and development innovations ensure superior deliverables to our customers.
Our motto is very simple: `Think Global ACT Local’. We would like to achieve global relevance by producing globally acceptable quality using globally relevant technologies and talent while maintaining the local advantages of lower cost of production. We consider the world as our market and the biggest opportunities that we witness is the current quality and cost structures. The company’s dynamic R&D practices have enabled it to deliver products with a holistic focus on technological precision.
A distribution network in the aftermarket of 29 countries and representation in Germany, the US and Japan for OEMs form a strong backbone, supporting the large quantum of export that NBC has managed to clock over the years. The company’s presence in key international exhibitions, conferences and expos, ensures that the international OEMs and aftermarkets are aware of our capabilities.
Q: What kind of solutions you provide to your customers that cannot be catered to by your competition?
A: At NEI, we stand out from our competition and command an edge by offering technically superior products at a price far more reasonable than its European counterparts. The company’s success in both domestic and international markets is the result of its continued focus on research and development and investment in technology. We have a dedicated R&D arm where research takes place on distinct areas such as tribology and lubrication, advanced materials, advanced processes, product design, virtual simulation and testing. The result has been a steady increase in patent filings, which has further strengthened NBC’s resolve to invest in R&D progressively every year.
Our entire supply chain has a ‘Zero Defect’ approach. Already at less than 100 returns per million, we are aiming for less than 10 returns per million for the future. From 10mm bore to 2000mm outer diameter boring, we manufacture precision products for a variety of industrial and product categories. Our product portfolio allows us to cater to various segments other than automobiles, such as railways and aftermarket. Flexible approach, commitment to customer satisfaction and relentless quest for innovation help NEI deliver exceptional customer service.
Q: With India trying to catch up with BS-VI by 2020, the OEMs are looking at various options to compensate fuel efficiency losses from emission compliance. What are the solutions that NEI offers to OEMs to help offset the frictional losses?
A: One of the critical areas related to automotives is the conservation of natural resources. In a vehicle, only about 12.6 percent of energy is used for motion while 62 percent is lost to engine friction, engine-pumping and to waste heat, 17 percent to idling, two percent to accessories operation and 5.6 percent in the drive train due to friction and slippage.
By understanding the various torque contributors to the bearing such as grease, seals and internal bearing geometry, NBC manufactures a wide variety and range of bearings for automotive, industrial and Railways applications. NBC’s assortment of bearings includes large diameter special bearings for the Railways, steel mills, heavy engineering industries and power generation plants. The company also manufactures axle boxes for Railway rolling stock, and other allied, special and next generation products to improve fuel efficiency and reduce friction.
We also manufacture a wide range of metric and inch series deep groove ball bearings, angular contact ball bearings, self-aligning ball bearings among others, including Thermo Mechanical Bearings (TMB) for longer life and special heat-treated bearings for dimensional stability at high temperatures. NBC has engineered fuel efficient bearings for transmission and wheel bearing application of two-wheelers as well. Various other programmes are under way and NBC is working towards extending the technology to other areas.
Q: What are your solutions for two and three-wheelers and passenger and utility vehicles?
A: With more than 150 million units in 1000 sizes produced annually, our responsive design and development innovations ensure superior deliverables to our customers. The product range includes Ball Bearings, Taper Roller Bearings, Double Row Angular Contact (DRAC) bearings, Cylindrical and Spherical Roller bearings. NBC Bearings are widely used by two and three- wheelers, cars, trucks, tractors, electric motors, Railway wagons, coaches and locomotives, steel mills, heavy engineering plants, bulldozers, shovels, tillers and thermal power plants.
Since the two-wheeler application has special requirement of low noise, compact design and rough use, NBC addresses all these requirements through special bearing design, seal design and selection of the right grease. Three- wheeler applications have requirements similar to two-wheelers, and NBC caters to these in the same manner.
For four-wheelers, there is continuous requirement of comfort, less friction, low noise and fuel efficiency with reduction in size. NBC makes bearings to suit current trends while helping its customers meet strict environmental and statutory regulations. On the other hand, tractor bearings are subjected to heavy loads and have high exposure to mud and water. Apart from special designs, NBC provides these bearings with special seals and grease to withstand adverse environmental conditions.
Q: Automated Manual Transmission (AMT), which calls for high precision actuators, bushes and bearings, has picked up in passenger cars? What has been NEI’s role in this?
A: NEI is constantly working on optimizing the performance of bearings when it comes to newertrends in transmission. Our forte is still rolling bearings and in that regard we are working on bearings with lower friction, power density and advanced technologies which concern rolling contact that can meet demanding needs of customers.
Q: AMT is also getting into commercial vehicle segment. What is your contribution?
A: In commercial vehicle segment, we have a major share of business owing to our Taper roller bearing portfolio, which offers many variations in design and performance.
Q: Bearing manufacturers have limited options to contain cost as they don’t have control over raw material costs and labour. How do you manage? these issues to be competitive?
A: Our manufacturing technology’s focus is on automation, higher productivity and lowest initial cost of machines, while our product technology roadmap has a major focus on creating value like energy efficiency and power density(smaller bearing for higher load). We have always aligned these strategies to produce the best products for the customers.
Q: Bearings have been commoditised long ago; how do you really make money?
A: By offering value-added products and services, and continuously working on increasing operational efficiency.
Q: How do you contain rejections?
A: At NEI, our focus is on preventive control through robust processes. We also have in-process detection checks at critical stages including advanced methodologies like optical (camera-based) detection of defects.
Q: Despite having robust manufacturing process, there could be rejections, due to the human element. How do you manage this?
A: Precision in automation and machine accuracy with entire automated operation are major challenges the Indian industry is still grappling with. We have already started with indigenous manufacturing for assembly machines and some of the machines are already running with our new world-class manufacturing facilities at Vadodara.
Q. How do you train the workforce to keep them motivated to produce flawless products?
A: We believe in Empowering Learning Solutions. At NEI, compatibility and competence go hand in hand to strike a unique and competitive balance. Our people development philosophy believes that to achieve sustained success it is essential for the organization to enhance its intellectual wealth through company-wide learning interventions. In this perspective Learning and development at NEI is for creating a learning culture and building adequate capabilities to withstand the fast changing business scenario.
Since its inception NEI’s people development philosophy has been very aggressive. We strongly believe that people are our prime assets and key drivers of our growth. We continue to focus on strengthening our HR practices to create a quality work environment that motivates our people.
Multiple development initiatives which include continuous learning and employee training programmes aim at building competencies for managing business complexities. We conduct various value-based training programmes for our people and our well-groomed in-house trainers build the culture of knowledge sharing to enhance the overall performance.
We believe that strengthening the talent pool is like adding fuel to the organization to achieve its strategy. The Leadership Development Council at NEI is encouraged strongly in the organization which tracks the development of high potentials on a regular basis.
Talent review sessions are held for identification and development of Hi-pots. Various large scale learning & development initiatives like CLAPS (Collaboration, Leadership, Accountability and Responsibility, Process Adherence and Speed), Udaan etc. are organised regularly as per organizational vision and NEI competencies for growth.
Q: Tell us briefly about your different manufacturing plants – what is made in each plant, capacity etc.
A: NEI has four manufacturing facilities located at Jaipur (Rajasthan), Newai (Rajasthan), Manesar (Delhi NCR) and Vadodara (Gujarat). With a total installed capacity of 150 million bearings a year, all NEI plants are automated and systematic, with standardized processes and sustained service. While Jaipur is the mother plant churning out 50 million units annually, Newai makes 30 million, and Manesar 20 million units a year. The fourth plant at Savli, Gujarat, is rolling out 40 million units (for both automotive and industrial segments) per annum at full capacity.
Spread over a total area of 4,78,900 m2 and a covered area of 75,310 m2, Jaipur plant has state-of-the-art manufacturing facilities and can manufacture all types of Ball and Roller Bearings of NEI product range. Manesar, Newai and Savli plant have state-of-the-art fully automatic grinding and assembly lines that manufacture ball bearings.
Q: More specific details about your new plant in Savli, Gujrat?
A: NEI recognizes the benefits of renewable energy and is increasingly relying on alternate sources of energy to fulfil its energy requirements. With an aim to maximize the use of renewable energy in manufacturing operations, NEI has conceived and conceptualized the Savli plant in Gujarat on a green footing. The ability to develop sustainable buildings has brought the plant novel and prestigious IGBC Platinum Certification, which is the highest green rating available in India.
The plant implements a wide range of eco-friendly initiatives such as Rain Water Harvesting, rooftop solar photovoltaic panels, VRF air conditioning, insulated PUF panels for roof, high solar reflective (SRI) top coating, LED lights, sewage treatment plant, native plants to consume less water, autoclave aerated blocks for energy efficiency and recycled fly ash and low VOC paints. Additionally, the spaces are designed for maximum daylight entry and three dimensional energy modelling has been performed to optimize energy and daylight simultaneously.
Savli plant manufactures Ball Bearings and Taper Roller Bearings and has a capacity of 40 million bearings annually. With a total Investment of Rs. 500 crore, the plant contributes to the company’s exports as well. NEI has always adopted best practices for sustainable development and the IGBC ’Platinum’ certification further strengthens the company’s commitment. Indeed, the Savli plant is a prime example of amanufacturer taking stewardship of the processes and products to mitigate any detrimental environmental impact.
Q: How how do you manage distrobutors and inventory?
A: We serve the Indian aftermarket through a countrywide network of more than 500 authorized stockists. With reference to inventory, we manage the same by analysing and forecasting customer demands, keeping in mind the fluctuations
Q: How do you tackle the spurious parts manufacturers?
A: We are already working on an anti-counterfeiting solution to address the concern of spurious parts. We constantly educate our aftermarket channel partners through seminars and meetings
Q: Tell us about new product development? How has it evolved?
A: At the core of NBC’s engineering success is its Research and Development Centre, the only one of its kind in the country. Equipped with the latest CAD/CAM, calibration and testing equipment, special heat treatment facilities, and more importantly, with the sharpest engineering minds in the industry, this centre is responsible for NBC’s triumph in making bearings of unprecedented size and complexity. While these innovations have ensured technological leadership and an unshakable consumer base, the experience gained in designing these is the most valuable asset for the future.
At our life test laboratory, a skilled team employs state-of-the-art technology to scrutinize bearing-behaviour and life spans under the most exacting conditions. This helps us stay prepared to develop the next generation of bearings for a new and more demanding industry. NBC has the distinction of being one of the few companies in the world to manufacture bearings up to 2000 mm outer diameter with indigenous technology – clearly an in-house R&D achievement.
The lead-time target for new products is high and as lead time has reduced, the number of new products per year has significantly increased – from 22 new products in 2009-10 to 66 new products in 2012-13. Already this year 42 New Product Developments are under way. With global consultancy and university partnerships our experienced team is involved in the development of integrated solutions and value-added products.
Q: What are your new initiatives on the HR front?
A: NEI offers an exciting and progressive workplace for a great career. We follow value-based guiding principles and our people are our greatest asset. The HR practices at NEI follow the core philosophy of creating a high performance culture with ample growth opportunities for self-development. The open yet challenging environment helps our people realize their potential to excel in every sphere.
NEI provides an open yet challenging atmosphere to stretch limits and attain growth. Various Leadership Development and Talent Development initiatives are regular features at NEI.
Leadership Development Programmes: Right from identifying emerging leaders and up to training future chairman-level employees, NIE has programmes which identify the right talent and put them on the fast track for future career progress.
Job Rotation– To develop our people, company promotes Job Rotation. People who have invested a good amount of time at any certain area are moved to another area to make them competent overall. This movement helps in grooming of people with multi skills and also breaks the boredom of repeated working. Various Capability Building Programmes – NEI organizes various capacity-building programmes to enhance its internal capability like Six Sigma Training programme followed by identified Six Sigma projects of different areas. Such initiatives help the company grow on an intellectual level and promotes employees satisfaction at the same time.
We have recently launched an innovative ‘Back on Track’ programme to provide opportunities for talented women back into the workplace after career breaks. Under the programme, the plan is to recruit reasonably good number of women on career breaks into various management roles over the next three years. The programmeis designed to help women on transition back into the workplace and offers them a chance to work on client projects, upgrade skills and broaden professional network.
Q: Short- term and long- term plans for manufacturing and R&D?
A: We are present in Automotive, Industrial and Railways segments and all these segments are growing in India. In order to sustain and increase our presence in these segments we are continuously investing in capacity and technology and new products.
We plan to double our sales turnover in the next 4 years. We are a global player and 25 percent of our revenue comes from exports so we are planning to increase our footprint through M&As or green field projects. We have plans to invest more than Rs 100 crore in the next four years.