It’s about ‘working on’ the business

A first generation entrepreneur, Makrand Appalwar, Chairman & Managing Director at Emmbi Industries Limited had a tough time convincing financial institutions to believe in his idea of business and receive funding. In 1994, he received seed funding of Rs 5 lakh and with Rinku Appalwar, he set up a packaging business which they thought was going to be revolutionary in the years to come. And they were right. Within 20 years, the company has grown exponentially – from an employee base of 30 in 1994 to over 1200 employees today, the total turnover of the company is Rs 225 crore. Today, Emmbi manufactures all sorts of polymer-based products from jumbo bags, car covers, pond & canal liners, crop protection products in over 5 continents and 50 countries. Emmbi went public in the year 2010 and with the IPO money their expansion plans have received a great boost. 

People Matters spoke to Makrand Appalwar on transforming a small trading organization to a global manufacturing and supply company and the challenges of scaling-up. Below are some excerpts from the conversation.

As a small organization, the primary challenge is about selling your idea and vision to the people you want to hire. You have limited bandwidth with regard to the number of people who are willing to work with you primarily because you are just setting up a new business with limited funds. So, a premier college management graduate will seldom come and join you and the compensation which SMEs will offer will be far lesser than the behemoths of the industry. There is less number of people who are willing to work in a far-off location. Secondly, since it’s not an established brand, candidates are not even aware of the company. As there are a limited number of candidates available, the level of maturity in handling operations by the middle management is also a challenge. Start prepping employees for larger roles. Hire specialized people for the right job – if there is a need for dedicated teams for operations, research, finances, it is better to structure the organization in the beginning. In order to scale-up, what you need is not an owner’s manual, but a structure-driven organization. That’s how you create pin-pointed and sharp roles for people whom you hire, and also your ROI will be higher since you have invested in them. 

When an organization marches on a growth path, financially and people-wise, what becomes a matter of concern is creating a “Best Fit” for the human capital a company acquires at the different stages of its upward journey. For us, the employees who were part of the initial were not really fluent in spoken English, though their work and commitment showed their level of expertise in the segment. We engaged this batch of employees for a hands-on communication and presentation trainings that helped them to be at par with the new batches. More specific roles suitable to their core strength were handed over to them and new people were selected for other jobs, ensuring everyone a “role of their choice”. However, the new managers who were hired were from a different background resulted in a mismatch. As an organization, we realized executive coaching was an effective way to handle such a challenge, along with initiating confidence building measures for the old managers were taken into account. 

At Emmbi, we always believed in the developing our employees with training and specialized coaching. It is not mandatory for the person to continue on same job if they are interested to shift to a new position; this in turn helps bring in new ideas by job rotation  which prove to be value add to the company. While filling in the new positions, it is always a great help to take a look at your internal talent pool along with the fresh outside talent as this can also help in offering a better growth path to the existing talent and enhance success as a team. 

While hiring for new positions, be as clear as possible about roles, responsibilities, job description and KPIs, and inform the employees about the key areas they will be evaluated on. It is essential to be able to clearly mention what the management is looking, what they want from the employee and also how they are being evaluated. It links back to the structured approach that organizations need to have which was mentioned in the first point. 

The day you cannot monitor every employee in your organization, that’s the day you should get your HR team and processes in place. There are many factors that lead to happy employees and one of them is correct performance evaluation. But when an organization grows, it is not possible to evaluate performances on the individual basis. You need the HR for this as employees need that emotional support, the recognition of their efforts, trainings — sooner you realize this, the better it will be for the organization. In today’s fast changing business scenario, we need to understand that business is not “set” at any given time; it is a very dynamic environment. At Emmbi, we first started with outsourcing the HR function and had one person in our office, and now we have a full-fledged Human Capital Management Department.

The best advice I have received was from my Professor at MIT Sloan School of Management. He encouraged me to ‘start “working on” the business and “not in the business”.’ It is about getting the band of highly capable people in your organization and let them take decisions. Micro-managing will not help in the long run. Let the capable minds decide what’s required and what helps the organization grow. In short, I will say that a promoter should set up a “vision” and the executives should work on “mission” to make it happen.