Rider of the Storm

IIPM, GURGAON

He’s blunt, bold and transparent. And he’s set his eyes on reversing Yamaha’s fortunes in India

“When I first came to India, this place (the Yamaha India plant at Greater Noida) was a zoo. The workers in the factory did pretty much as they desired. And at any given point of time, nearly 30-40% of the labour was not working,” is the brutally frank admission of Tomotaka Ishikawa, MD & CEO of Yamaha Motor India today. Sitting pretty in his casually elegant room in the plant, with an entire wall plastered with various pictures of him and bikes, he can afford to be candid. After all, since his arrival in India more than a year ago, he’s managed to not only resolve Yamaha India’s labour troubles, but has also crafted a ‘fun’ game plan to help the Japanese two-wheeler major break new ground in the country, which includes getting Yamaha’s big racer bikes R1 and MT01 to India.

And you’d better believe the man. He may look unassuming and petite in his spectacles and conservative business suit, but this samurai is a fierce fighter all the way. Credited with the turnaround of Yamaha’s fortune in a series of south East Asian markets, his particular brand of strategies have particularly worked wonders in Thailand’s two-wheeler mart.

Faced with the rising onslaught of Honda and Suzuki, Yamaha was a dying bike brand in Thailand (their market share had plummeted to about 9% from the earlier 30%), before Ishikawa began to wreak havoc on competitors in 2001. “I gave the Thailand management three choices. I told them either you be a quick adaptor of lower prices like Suzuki; or you find Honda’s weak point; or else find a niche for yourself. We finally settled in for the third option,” affirms Ishikawa.

He introduced automatic engines, targeted the younger generation with stylized accessories, and introduced swanky new merchandising. Honda slashed its rates by 15%. The unconventional Ishikawa, instead of crumbling under pressure, retaliated by upping Yamaha prices. Ishikawa reminisces on how his distributors in Thailand at the time thought him insane, but the strategy ultimately paid off. In just 4 years Yamaha had got back to nearly 25% market share in Thailand. Ishikawa became the blue eyed boy of the Yamaha head office in Tokyo.

Ishikawa’s Thailand experience has set the alarm bells ringing for rivals in the Indian market. The two wheeler giant made its India foray in 1985, in partnership with Escorts, making inroads into the hearts of Indian bikers by offering them sporty, performance driven products.

The RX100 tasted phenomenal success, but the momentum died half way through. Ask him, what went wrong with Yamaha’s India strategy in the first place and you’re almost astounded by this CEOs honest and frank assessment. “There was a gap between what the Indian customers wanted and what we gave them. They wanted an RX100 type of vehicle but we gave them what everyone else offered – nothing unique or different. We got caught in the volumes game and developed products that lacked Yamaha’s genes,” he pointed out. Hero Honda and Bajaj had a better product line up and walked away with all the glory.

In fact, for the month of May 2007 Yamaha India saw a whopping 100% drop in sales! Ask Ishikawa and you get another straight Ishikawa-style reply: “We didn’t have anything to sell!” No mincing words, for sure.

Adrenalin levels in Yamaha India are at an all time high now. Since Ishikawa joined Yamaha India, Gladiator has already won the 125cc Bike of the year award in 2006. And with ‘Kando’ (a Japanese word meaning “Touching Your Heart”) – as their corporate ethos, the buoyancy has touched every Yamaha employee.

Ishikawa is borrowing heavily from his Thailand experience to get a one up on his Indian rivals, and that too with a planned investment of a jaw-dropping Rs.1000 crores. “We are just going to go back to the 4Ps of marketing for the Indian market,” he avers, adding that a new product line up had already been finalised. Refusing to divulge more details at this stage, he only says that, “The product will be affordable and attract the younger generation. It would be a product uniquely designed for bikers, and not commuters.” The idea behind the emphasis on bikers (instead of the earlier commuters) is to come up with hi-sense, hi-fashion, cool products that will be ‘fun’ and attract the younger generations. The new model line-up is set to be introduced in the Auto Expo in January 2008. “I’m not greedy, I’m realistic. We hope to grab 19% of the motorcycle market in the next five years,” says Ishikawa.

Believing the Yamaha India employees to be his biggest asset today, Ishikawa is in awe of the mathematical and engineering abilities of Indian people. “The Thai’s are just no comparison,” he says. He believes, that employee retention is one of the key factors that would make the company attractive in the eyes of the public. “I want people to say that God! I’m so lucky to be working with Yamaha.” In the same spirit, Ishikawa is working closely with his team to change the work culture of Yamaha India. In fact, he says that whatever HRM systems initiatives he has introduced so far, have brought fruitful results.

In line with this new vision, Ishikawa rolled out a new internal mission statement in July 2007 - New Yamaha, my promise dil se! And mind you, these are not just empty words. The CEO himself amply displays his heart’s commitment to turnaround Yamaha India’s fortunes, when he says that the primary reason why he has not invited his wife to come and live with him in India is because he needs “no distractions.” Now that’s really dil se dedication Mr. Ishikawa!

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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