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India has great investment potential for foreign companies if you manage the highly complex business environment professionally. Our experience shows – Maier+Vidorno is a competent partner to efficiently set up and run business.
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The cooperation of JUMO and Maier+Vidorno is a success story in India since 2008. Our sales, market presence and profitability in India shows constant growth. M+V knows about the challenges foreign companies face while doing business in India – and provides hands-on solutions.
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The Fokker Elmo’s factory in China is at a standstill due to the coronavirus. However, the Indian factory of the Dutch manufacturer of cabling systems for aircraft continues to operate. A few years ago, Fokker Elmo opted for spreading the business risk. Owing to which they decided not to have factory expansion in China, but to have a new factory in India. “In India, we not only found a large supply of better-trained personnel but also lower labour costs than in China,” says Maarten Durville, director of the Indian production hub.
“As a company, if you have the luxury of spreading risk, you have to do that,” Maarten explains. “We would be in a difficult position right now if we had only focused on China. Due to the coronavirus, the Fokker Elmo factory has been closed for more than two weeks. Moreover, the production has come to a complete standstill there. According to Maarten, the other factories of the aviation company are not able to deal with that blow immediately. “But it makes you as a producer less vulnerable when you are in several places around the world. Further, India also offers us opportunities that we don’t have in China”.
EXPLORE THE POSSIBILITIES FOR AN OWN PRODUCTION LOCATION IN INDIA
India’s aviation sector is growing rapidly. Not only the commercial sector, but also the defence arsenal is expanding considerably. “By opening a factory in India, we offer our customers an interesting combination. It is good products at a competitive price and the opportunity to make a deal with the Indian government. There has long been speculation about the possible purchase of Boeings Super Hornet Fighter by the Indian government. “And they want something in return for such a big purchase. Boeing can then say: ‘Look, we build in India through Fokker Elmo and that’s how we create jobs in India. That makes us an extra attractive partner for Boeing.”
The factory in India is now a few months operational, which is almost a year later than planned. “We’ve had two major delays, one was internal and the other had to do with obtaining permits. That takes an awfully long time in India.” Maarten had the support of an Indian project manager during the set-up. Despite the fact that Fokker Elmo has a lot of knowledge about starting a factory abroad, help was desperately needed. “I could not have done it without him. It all took so much work: from property registration to obtaining the license for operation. Indians are extreme on the comma.”
But an Indian project manager alone wasn’t enough to get everything running. “For all corporate reporting, we work with local accountants. Furthermore, for the recruitment of the right employees we have Indian consultants in our team”. Maarten currently manages about 40 people, which should reach 800 in about five years. And they should be able to participate in the hybrid, international corporate culture that Maarten is shaping within the company. “I would like to keep the Indian ambition and enthusiasm, but I am replacing the hierarchy for openness so that everyone can freely put forward their ideas and dare to criticise.
Maarten cultivates this openness in various ways. For example, he holds a monthly session with the management in which the values of Fokker Elmo are discussed. Everyone who participates then has to give good and bad examples of the open company culture. “Personally, I think the introduction of our joint lunch is a nice example”, says Maarten. “When I started, I suggested having lunch together, at a long table. So the managers, engineers, operators, are all through and side by side. That’s not common in India at all and I got very different reactions”. It was mainly his young employees, under 35, who thought it was a terrible idea. The more senior employees had to get used to this initiative. “And then there was the group that immediately said: ‘We’ll get the cleaners’. Not to eat with, but to set the tables straight. Then I explained to them that we could do that ourselves as well.”
LOOKING FOR PERSONNEL THAT FITS WITHIN AN INTERNATIONAL CORPORATE CULTURE? WE WILL FIND THE RIGHT PEOPLE FOR YOU!
Maarten is very pleased with the quality of his personnel. “I heard a lot of stories before I left for India. That there would be a lack of knowledge and dedication among employees, but I see just the opposite. They dare to take ownership of their successes, but also for their mistakes. I hardly see that outside my team in India.” In cooperation with local parties and contractors, Maarten regularly encounters the same problem. “They often give you the answer you want to hear. During the construction of the factory, for example, I was often told by contractors that a certain task still needed about three weeks, but in reality, there were six. If they tell me the truth, I could come up with a solution, but the delay is covered up. Fortunately, my team has learnt that.”
That team is therefore recruited with the utmost care by the local HR consultants. “We do a lot of campus recruitment. We also try to enthuse as many women as possible to come to us for talks. It’s still hard work, especially if you’re looking for women with a technical background. However, we have some very good ones on the team at the moment. Now the question is whether they will stay with us when they get married”. Maarten hopes that the good working conditions offered by Fokker Elmo can keep them inboard. But meanwhile, there is also a subsidy application from the factory with the regional government. “We are trying to get a subsidy with which we can train more women within the company and offer them work, but it is still unclear when we will be able to start with that. The process takes a long time.”
It was not possible to just submit some forms to let Fokker Elmo compete for the regional jar. “I’ve really learned that you have to go. The best thing is not to make an appointment, but just to enter a regional ministry. And, see if you can get the person in charge. That has given me a lot so far, that personal contact opens doors that would otherwise remain closed. My project manager did not say to me for anything: ‘Maarten, a no is not the end’.