We began the second day of our final retreat in New Delhi with the CEO of Safran India Private Limited, a defense contractor. Safran’s business in India focuses on aerospace, defense and security.
Meeting with the CEO
Our session with the CEO, Stéphane Lauret was the first of two meetings we had with Safran India Private Limited. The first was based on the company as a whole; our second session with Mr. Satish Kurtikar and team in Bangaluru would focus on engineering services. Lauret is part of a multinational corporation and has worked in France, the United States and Mexico prior to coming to the take the lead role as CEO. Part of Safran’s success in India stems from the joint ventures that it entered into in the late ‘70s. It has joint ventures with Hindustan Aeronautics Limited — HAL — the only public company in India for helicopters and planes, as well as GE. The GE joint venture holds the record as the longest partnership, existing for 40 years, and they recently renewed the joint venture for an additional 30 years. At one point in time, Safran had worked with HAL on rockets as well, but due to nuclear proliferation, they are no longer allowed to collaborate on that.
For a defense contractor, sometimes getting an award under contract can take an extended period of time. This is true for India, although the new Indian government is beginning to push through contracts that have been stalled, like the Rafale aircraft contract that Safran won 12 years ago. While the contract hasn’t been signed, Lauret was optimistic that it would happen in the near future. Why? Because a tweet was released from someone in the Parliament on the deal being signed. Lauret went on to share that you are more likely to find out a deal is agreed to by reading the news or tweets.
Five years ago, the Indian government would have procured 80 percent of its military needs through Russia. Today, it is working to more broadly distribute procurement across other nations, like France (Safran) and the United States (C-130J Super Hercules helicopter).
Safran also works in biometrics, and through the Aadhar program, Safran has helped to provide smart cards to one billion Indians. These smart cards include biometric information to provide individual identification. These smart cards are also used in 100 other countries, including the United States.
One question that we’ve asked in all of our meetings is “What are the biggest challenges for the companies?”
Overcoming Company Challenges
Lauret said he had two challenges to contend with: the difference in culture and the workforce. When he worked in Mexico, he observed the Mexicans were very much like the Americans, wanting to get things done. In India, he has found that he needed to re-examine how he talks to his workforce, how do you convince your group you need to do more? The leadership team has had to adjust and adapt.
His other challenge concerned the attrition of the workforce. Safran targets students from IIT and IAC Bangalore. The issue for him is that after being trained, employees are leaving after a year in the company. Unlike the rest of Safran, Safran India hasn’t entered into the rotational programs to give its employee base a broader understanding of the company, but this is something the team is working on, Lauret said.
Women in the Workplace
He also talked about women in the workplace. While the workforce has increased by 30 percent over the last decade, very few members of the new workforce are women. Due to some incidents at factories in New Delhi, women are no longer allowed to work the second shift. In many respects, the largest number of women are still in secretarial positions, with few engineers. This again, ties back to the Indian culture, which requires the women to take care of the home.
However, it is not only Indian culture that accounts for this, the global defense market remains a male-dominated industry. But many of Safran’s competitors in the United States have set goals to increase the number of women within the company at all levels. Many also participate in Science, Technology, Engineering and Mathematics (STEM) programs to increase the number of girls interested in the sciences and the number of engineering students. Currently, Safran India has not set any target goals to increase the number of women in the workplace. The implementation of programs like the one put forward by Prime Minister Narendra Modi to ensure girls are given primary and secondary education will take several years to implement, but once it is ingrained in the country, it will change business diversity Lauret closed by saying everything takes time — both in business and personally; this is a theme we’ve continued to see though out our time in India.
Read the second post about the GLEMBA Class of 2016 international study tour to India: Federation of Indian Chambers of Commerce and Industry.
