Interview Questions

Full Interview with Ashok Sinha

Ashok Sinha:

Over a year ago, we decided to conduct brainstorming workshops with a 100-odd members of BPCL's senior management. They in turn went to their people to figure out what is it that we do best, what makes us successful, and what are the ingredients at BPCL that make it work. Based on this discovery of our core strengths, in which almost everyone participated, we underwent a process of dreaming up a vision. Even the worker unions were taken into confidence, and in consideration of the vision, their roles and inputs were discussed and defined. We called this vision Project Destiny. We wished to, in a nutshell, double our volumes and quadruple our profits. Each of the six business units in the organization has started aligning its roadmaps to enable the company to achieve the aggressive growth rate we envisioned.

Though the design component - wherein we defined the strategies, roadmaps and business plans - is in place, we have kept the design live and continuous as things evolve and change with time. With the aggressive growth we are looking at, we also needed to identify leadership positions and competencies required. This was undertaken under a project named Caliber, which was all about ensuring proper succession plans, grooming people to the required potential, and ironing out constraints. Another project, christened Crescendo, was conceptualized to take care of the overall integration of the entire organization through supply chain management, starting all the way from demand planning to the actual buying of crude for refineries.

 

Ashok Sinha:

IT has been crucial to BPCL not just for achieving this goal, but also on an overall basis. It all began in 1988 when we restructured the organization. In order to make our structures work, we had to do a relook of all our processes, and streamline and embed them in our ERP system. Two years after we implemented the ERP, we revisited it and changed everything to get into the next level of ERP systems.

Later, we used the existing infrastructure and processes as a stepping stone to bring into effect another phase of business process reengineering. The focus of such reengineering was to figure out whether our structures and processes were properly aligned, so that they ultimately help us serve our customer better. Here, IT continues to be a business enabler, as it continuously gives us inputs on how we can do things better. To be able to come up with progressive ideas and inputs regularly, which affect business positively and keep all processes and other projects in sync, we have started a project called Aryabhata. Our IIS (Integrated Information System) team that comprises both business and IT experts, and the ERP Competency Center contribute to Project Aryabhata.

 

Ashok Sinha:

Successfully staying ahead is a challenge. Undoubtedly, the IT department is very aware of a plethora of New Age technology solutions and cutting-edge products. But, if the business sees no value in going a particular way, such solutions never get implemented.

The real challenge, from IT's point of view, is: how do we keep ahead while looking at things differently - and sell new concepts and ideas to business from the perspective of hardcore cost-benefit analysis? We run pilots to test things out and showcase benefits. If the benefits are visible, then the new solution gets implemented. For example: we introduced smartcards in 1998-99. We were probably the only nonbank entity to introduce prepaid debit cards.

This was in the period when analysts were of the view that India would not ready for smartcards till 2007. However, we knew the technology was there and that we had to show why it made sense. Today, we have over 2 million cards in the market that operate all the time. Our total turnover through the cards is close to Rs 9,000 crore.

So, we do stress on experimenting with IT to stay ahead in business. Currently, Project Aryabhata is trying to look at newer technologies and figure out whether they will make sense to business or not. If they do, they will get adopted because IT is absolutely core to our business. With our size, we don't have a choice in this matter. The extent of our business and amounts of transactions are too huge to be handled in any other way.

Ashok Sinha:

We have six core businesses. All the customer data from these ultimately reside with IT. Therefore, we do need to have a single view of our customer across businesses because the customer, for example, could be a user of our LPG and he might also be fueling his vehicle at our service stations. Is there a way to link it all up?

There is no straight answer as it is very data intensive and you have to eventually get into analyzing psychographics. That, in itself, is a huge challenge. It is quite possible at a conceptual level, but with the conflict that still exists among the businesses as to 'Who owns the customer?', I don't think we have moved much at this stage. We are, of course, continuously looking at this issue because there are technological means to link all information on a customer as he touches us at various points.

Ashok Sinha:

As I mentioned, we have not been able to take it across everything. Just to cite one customer base we interact with, we have close to 22 million LPG households. If you start appending attributes and psychographics to each of these records, it will be a humongous database you would land up with. If we are to collect this data, it'll be at a huge cost and won't make viable business sense. We have indeed captured subsets of data - for example, the customers using petro cards. But considering the size of our country, even capturing subsets completely is a huge and expensive task. We can always build technological solutions that we need, but the business case is not feasible at present. We have other ways to tap our customers and will leverage those first, before conducting psychographics becomes a feasible option.

Ashok Sinha:

As far as Clause 49 (of the Listing Agreement of Stock Exchanges) is concerned, we have a fairly robust system in place. This has been possible because we have an equally robust ERP implementation. Today, it is only an issue about making sure that everything is aligned to the certification process and streamlined for external audits. We have looked at risk management profiles and external reviews of our processes to make sure that we are compliant with the regulatory requirements. IT here plays a collation game because it is ultimately all about people-governance. The initial IT impediments will always be present as there will be a certain amount of system and process realignment requirements to be met to embark on a compliance roadmap. Once you take a centralized view of your enterprise, there will always be process-related issues, especially in an organization of our size. Managing master data is critical to the approaches of how your system will work and how you are going to adopt regulatory compliance. We have had our share of roadblocks, but we had basic structures and processes in place to deal with them.

 

Ashok Sinha:

It is very difficult to correlate one with the other. This is more of a loyalty card, rather than a salesorienting card. It helps track customers who keep coming back. Nevertheless, since different customers have different needs, we have brought out specific solutions riding on IT to serve them better, ultimately impacting our sales. For example, we have introduced a fleet-card for corporate that run a fleet of 150-200 cars. With the fleet-card, BPCL basically reduces the drudgery of the customer's administration department keeping track of various facets of the 200 cars, like vehicles' mileage and those that need to be refueled, etcetera. Today, we can provide a consolidated status report of each car registered under the fleet-card. Similarly, we can track trucks for their owners. Even if the truck is in Assam, the owner in Bangalore can get an SMS as soon as the truck refuels. This, I feel, is quite simple as once the basic transaction is over, the information flow is just part of communication. But, these services are value-additions to our customers and positively impact our sales.

 

Ashok Sinha:

I was part of IT in this company, not only as director (finance) but earlier as well while setting up systems at our refineries in 1986. IT has been core to my role throughout, irrespective of whether I was directly involved with IT or not. This definitely helps, as I can know more about what our IT team and the IT decision-maker would be thinking, and am clearer as to how solutions will be rolled out and begin to impact the business. This helps me keep close tabs on IT strategies in sync with business in a profitable way.

Ashok Sinha:

Our senior IT executive is always part of our strategy building endeavors. We have an executive council and the head of the IT department is a core member. We continuously get inputs from him in tandem to its other members such as administration, finance and international trade. All of them are part of the same governing council. This helps us keep everything in sync, every requirement addressed, and all processes and systems tightly integrated in place, ultimately helping business grow steadfastly.