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Chairman Arvind Poddar: Ag and OTR Tires Lead the Way at BKT

Posted on December 6, 2015

Balkrishna Industries Ltd. (BKT) is pretty proud of its new off-highway tire plant in Bhuj, India. How proud? It has turned the grand opening celebration into a nearly two-week affair, referred to as "The Game Changer Conference."

Close to 600 dealers, suppliers and journalists were recently invited to visit the plant, which is located in the state of Gujarat and the city of Bhuj. Modern Tire Dealer Editor Bob Ulrich was one of them. Here is the first of his four news reports, which includes a blog on Thursday, Dec. 10.

Chairman and Managing Director Arvind Poddar tied the past, present and future of BKT together when he spoke to the 120 members of the press from around the world on Saturday, Dec. 5, 2015. He says one of BKT's key goals is an aggressive one: global off-highway tire leadership. Here is a transcript of his speech in Mumbai, India. -- Bob Ulrich

"Even the most brilliant ideas need to gain a solid foundation to be brought to life -- in other words: people and technology," says BKT's Arvind Poddar.
"Even the most brilliant ideas need to gain a solid foundation to be brought to life -- in other words: people and technology," says BKT's Arvind Poddar.

Good Morning Ladies & Gentleman.

On behalf of the entire BKT team I welcome all of you to this session of conference. I hope yesterday everyone must have enjoyed and had a great experience visiting our state-of-the-art Bhuj plant, which is now ready to serve our customers.

In the game of chess, there is a unique quality that distinguishes a true champion from a mere player. It is the ability to understand that each game consists of challenges as the game proceeds. And hence, the flexibility to adapt one’s strategy till the final move...

Since its inception, BKT has chosen to be a main player in this game, on the global chessboard.

This has been done with bravery and boldness, by always venturing on newer paths; this has been done with passion and commitment, by developing new products and solutions that are able to meet the growing needs of our customers; this has been done with humility and resolution for the purpose of achieving newer milestones.

This way, BKT has won, one match after another, achieving such extraordinary outcomes that today the company is recognized as one of the brand leaders in its field.

Move by move, we are going to unfold our strategy and you will see how BKT has first conceived and then achieved this objective and hence is poised to become the "game changer."

The history of any company reflects its identity. The present includes both the awareness of our past and the promise of our future. For this reason, I wish to outline the major stages of BKT’s path, from the group’s establishment in 1954 to this date, walking along 60 years of business.

Let us go back to the year 1954, when my father, the visionary founder Chairman late Mr. Mahabirprasad Poddar, took up a new challenge in setting up the production of cycle tires in addition to the already well-established textile business.

Even in this new venture, the results were immediate and promising. The company successfully established in the Indian market.

However, it was at the end of '80s that our group experienced its first evolution -- under the drive of a rapidly growing local market, full of new opportunities for those who dared to seize them.

Against this backdrop, my father sensed the potential of a new market segment, and in 1987, he took the group towards new horizons, by starting the production of two-and three-wheeler tires.

His determination and passion along with a profound business sense were honored, and the company became in a short time, a point of reference in this segment, gaining authority and leadership.

During 1994, an in-depth study of the international market showed a lack of a mid-segment brand in the off-highway tire industry, which was able to compete with premium brands on quality and customer care. A strategic decision was taken to enter into this segment.

In the same year, BKT went international with intense activities of market penetration, first in Europe, starting from the UK, then in U.S.

A new era opened for BKT, based on the founder’s dream and vision of an Indian company that is able to go beyond national borders with high-quality products and a business approach, based on ethical values.

A key moment and a real landmark for the company was the year 2004, particularly in view of BKT’s prospects in terms of development within the scenario of international competitive markets.

It is indeed during 2004, that BKT entered the segment of radial agriculture tires, a segment that still today represents the company’s main product segment, thanks to an extremely comprehensive range of products and solutions for the most varied and specific user needs.

A further breakthrough for BKT came with the launch of Agrimax Force tires for high-powered tractors in 2007. Agrimax Force is the most advanced IF technology tire, which was available only with the market leaders at that time.

Today, we are proud of having a very extensive range of radial agricultural tires consisting of over 230 sizes, and being also the leading manufacturer of Agri Radial tires across the globe.

The great success of the Agrimax range earned BKT fast recognition, and positioned the brand, at par with the market leaders.

Over the last decade, BKT’s steps have followed each other at a fast pace. On one hand, this provides evidence for the winning business model adopted by the company, and on the other hand, it highlights the increased authority the brand has gained in the sector.

The thirst of new products influenced us to move further towards OTR all-steel radial tires. After establishing our footprints in the bias OTR tire industry in the year 2008, we marked our entry into the specialized segment of OTR all-steel radial tires: an essential strategic move to strengthen BKT’s leadership in the off-highway tire market.

Huge investments were made to set up a new and modern production facility in Chopanki, in North India. Today at BKT, we have the production capability for the sizes ranging from 17.5-inch to 49-inch, and in 2016, will go up to 51-inch. This gave the company immediate recognition as a main player, even in the most demanding applications of the OTR radial segment also.

It is not a coincidence that over the years, as testimonial for the high product quality and the extraordinary performance level achieved, BKT has been granted recognition by major equipment manufacturers -- among these I wish to mention the Caterpillar certification.

BKT’s rapid and continuous development has been possible, thanks to the substantial investments made in infrastructure. Even the most brilliant ideas need to gain a solid foundation to be brought to life -- in other words: people and technology. BKT has believed in the strategic value of these two competitive advantages, ever since.

Looking at BKT’s history, from its early beginnings up to date, our multifold growth is evident. Compared to the first lot of land of 15 acres, where the company’s first production plant was established, today we are officially inaugurating our Bhuj plant, an industrial site of 312 acres, in addition to the existing plants at Aurangabad, Bhiwadi, Chopanki and Dombivali.

This is a model of BKT's new Bhuj, India, off-highway tire plant, complete with test track.
This is a model of BKT's new Bhuj, India, off-highway tire plant, complete with test track.

From an initial production of 10 MT per day, we are currently producing 600  MT, which will eventually reach 800 MT per day by 2017.

From 200 SKUs, we currently offer a complete product portfolio consisting of over 2,400 SKUs.

From 100 molds a year, we currently make over 300 molds to ensure final product quality and design, along with a very short time to market.

Investments in infrastructure have also gone beyond our national borders, leading to the opening of our four overseas offices: one in Europe, two in U.S. and one in Canada to support the local markets.

Today, BKT products are sold in over 130 countries worldwide through our network of channel partners.

We have been growing, including our partners and customers, in line with our mission: "growing together."

The most relevant resource for the growth and success of any company is its people. Building a team is a vital ingredient in this process. A team that shares the company’s mission and vision and also contributes positively to achieve a common goal. An effective team is the core strength of any organization.

All this has been achieved at BKT, with effective human resource management over the last few years. This was a challenging and difficult task, but has rewarded us with immense satisfaction.

Young graduates and experienced professionals with sound industry know-how are eager to work with BKT as it has become a desired organization to work with.

For this reason, we have made all efforts to create an encouraging work environment, where individual diversity is appreciated and at the same time, the spirit of team building is nurtured. Both of these are key elements to achieve the company’s targets and to look ahead towards new horizons of growth.

Today, more than 7,000 people are employed at BKT, with an average age of 37 years.

Ever since we entered into off-highway tire business, with the best infrastructure, best people and delivering best quality and value proposition, BKT’s products have been known to the market as most reliable ones.

BKT has always paid particular attention to the positioning of its brand on the market and has been committed to creating brand awareness along with excellent reputation.

The history of a company displays the corporate identity, its values, its mission and vision; likewise our brand represents the blend of this unique and original asset.

The brand is, indeed, the first element identifying a company and making it noticeable. It is more than, mere expression of brilliant graphic creativity. It is the blend of shape and substance, and it is a carrier of company’s core values for all stakeholders.

We have done all efforts to have BKT brand associated with continuous innovation, the ability to offer constant new quality solutions for the consumers, the ability of developing mutually beneficial relationships with all our partners and the ability to contribute to mutual success and growth.

All the marketing initiatives, we have developed since 2009 leads to a clear message: create value for partners and the end users of our products.

At this juncture, I would like to thank all our business partners, end users, press and media, for being the brand ambassadors for BKT. Without your support and backing, the current milestones would not have been achieved.

As a group, we always believe in corporate social responsibility. It’s the philosophy of giving back, to the society and environment, which are the greatest contributors for the success of any organization.

This awareness of both, social and environmental responsibility has always been part of our DNA. It is our way of living, our corporate mission.

At all our production facilities, we have adopted the most advanced standards for environment, health and safety. In our North Indian plants, over 40% of our power requirements are met through green energy generated through our own wind turbines.

As you have witnessed yesterday, Bhuj is a social industrial complex hosting residential and recreational facilities for our employees and their families, a hospital and a fire-station for the surrounding community.

The desire to perfectly execute the projects under Corporate Social Responsibility, have resulted into the creation of “BKT Foundation,” where we care about health and education.

Numerous projects have been aimed to improve infrastructural facilities at hospitals surrounding our plants. Such as, donation of intensive care unit or ambulances.

Support to Have-a-Heart Foundation for heart valve replacement and purchases of sophisticated devices for the treatment of heart patients, are part of this initiative.

In the field of education, we have been active since 1970s, when in India, girl child was deprived of education. This was taken as a challenge by our founder chairman, who built a school in the State of Rajasthan, offering free education to 300 girls at that time. Today, this school has modern amenities offering free education to over 800 girls.

We are actively supporting the projects managed by Akshata Patra Foundation, with its Mid-Day Meal Scheme, a nationwide school lunch program serving food to over 1.4 million children in around 11,000 schools across 10 states in India. This initiative serves dual purpose of education and health. Lot of prominent personalities of the world including Bill Clinton Foundation, are actively supporting this initiative in India.

Yet, the results achieved till date, by no means are a reason to rest. On the contrary, they are a stage on the steady path of growth, which has been differentiating BKT ever since, giving rise to new challenges to come.

Looking ahead is always our constant goal.
A company that is unable to look at its own future with courage, is like a person who is unable to dream.

So, what is BKT’s dream? What is BKT’s vision?

The answer is: to achieve the leadership in the off-highway tire market worldwide.

Undoubtedly, it is an ambitious vision, but we are sure that it is the right goal to pursue. Of course, we operate in a highly competitive and rapidly changing market. With fast-running evolution, the world has no boundaries, and both market and customer needs are constantly growing in terms of quality and quantity. But we are never worried and are ever ready to face all the challenges.

And to master it, we need to continuously adapt to change, reinventing and transforming ourselves.

Here, we are back to the game of chess I was referring earlier today, where the successful player, even if facing a constantly evolving scenario, clearly adapts and never loses sight of the final goal.

In this process of continuous evolution, very similar to the history of mankind, we do not want to forgo our founder’s spirit and his ethical values, on which BKT has built its past as well as present. In fact, these values are our shield to master all challenges we might encounter on this path.

Values such as customer orientation, integrity, transparency, passion, innovation, care for the environment and safety, commitment and social responsibility, are at the core of our business activity and enable us to look proactively and confidently ahead, for the good of future generations.

While thanking you once again, ladies and gentlemen, for your kind attention, there is a message I wish to leave with you. A message that is clearly emerging from the title of our new corporate book, “Committed to growth.”

Growth, growing -- is our commitment, indeed. But again, we wish to do it together devotedly, uncompromised and faithfully to the values that are deeply rooted across our organization coming from our founder.

In the era of globalization and change, the continuity of values in a company is a gift appreciated by all stakeholders. I wish you will do the same, and I hope you will recognize between the lines of this identity, which is a blend of past and future, tradition and innovation, continuity and also the ability to be a “game changer."

Thank you. Thank you all.

Related Topics: ag tires, Arvind Poddar, New plant, OTR tires

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