The Turn Around Wizard: Anil Nair, CEO, AGC Networks Ltd

Anil Nair, MD and CEO, AGC Networks Ltd in a conversation with Sharad Mathur

Anil Nair led the turnaround of AGC Networks, a global technology solutions provider owned by the Essar Group, which posted a profit of Rs. 14.7 crores in the FY 2015 after suffering heavy losses for two consecutive years. In FY 2014, it had suffered a loss of Rs 283 crores and the organisation had not posted a positive EBIDTA (Earnings before interest, taxes, depreciation and amortisation) since the quarter ending December 2014.

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When you came back to AGC Networks, it had posted a massive loss of Rs. 283 crore. What was your strategy to turn it around?

I was heading AGC in its earlier avatar – Avaya GlobalConnect – when it was profitable and an undisputed market leader. So, the overarching belief was that a company with such a strong legacy and reputation could be returned to its former glory, despite the magnitude of the challenge. Having executed three turnarounds before, one in 2009 in the same company, I knew the terrain. The template I used involves seven transformational steps pertaining to people, strategy, culture, optimisation, systems and processes, partners, and customers. Measuring and managing key metrics on an ongoing basis to implement the plan for profitable growth diligently thereafter.

How did you put together a core team for its implementation?

I’ve been in the industry over 30 years and have worked with many professionals. I got in touch directly with the leaders who in my assessment had the skills, experience and attitude to take on this formidable challenge, combining the ability to provoke change with a start-up mindset. While some would’ve seen coming on board at such a time as a career risk, every person I reached out to, without exception, looked at this as an opportunity to prove his mettle all over again.

What did you do to optimise the existing resources you had at your disposal?

Rapid optimisation across the board is imperative in a turnaround. For instance, we reduced the OEM (Original Equipment Manufacturer) partnerships we had as solution integrators in the ICT (Information and Communication Technology) space from 126 to under 10, because each partnership involves investments in people, training, certifications, inventory, logistics and coordination. We redefined the technology spaces we operate in to four clear quadrants, namely Unified Communication, Network Infrastructure & Data Centre, Cyber Security and Enterprise Applications & Services. We decided to exclude working in verticals and cases where line of sight to the last payment was diffused. And we optimised teams so every single person in the company is a real contributor.

How did you sell your idea of turnaround and everything it entailed to people in the organisation? What did you do to create a conducive organisational culture?

In a turnaround situation, there already is a sense of urgency, and willingness to run faster for sheer survival. So crafting the strategy and culture elements, the themes for all of us to converge around, and getting that right was critical. We re-examined AGC’s purpose and redefined it as: ‘accelerating our customers’ business with technology solutions.’ We said that our differentiation, based on customer feedback, would emanate from exemplary Responsiveness, sharp Execution and Design superiority. It got popular as the acronym RED.

We restated our values so we had a common behavioural protocol across AGC. It goes without saying that this works only when the leader puts the organisation and teams before individuals, including him. And that remains his decisioning hierarchy. There usually is universal acceptance to fair and meritocratic treatment, more so in a conducive environment!

What were the key systems and processes you put in place that helped the turnaround?

Delivering customer value involves the entire value chain, including sales, marketing, consulting, applications & design, logistics, projects, services, HR and finance teams. Optimising one team and ignoring another creates outages which customers dislike because it hurts their business. So our leaders looked at ironing out the kinks and simplifying systems across the board. For instance, we measured every element of RED for progressive improvement. We reinforced systems and processes to preclude bad orders and sharpened our logistics to enable shorter execution cycle times, while tightening our collections so cash flow bottlenecks were eased.

How did you manage to win the support of your partners and customers?

Very simple. We only made commitments we could fulfill, and fulfilled them. We ensured that bravado didn’t get the better of us while committing project closures to customers or payments to partners. In fact, we publish customer testimonials every six months and their feedback inspires us to notch our service levels higher. We seek partner feedback for course correction from time to time.  At the start of the journey, customers and partners kept reiterating the fragility of our operations and finances. Today, they appreciate the change in our fortunes and we acknowledge the part they have played in giving us a renewed lease of life.

This was one of the greatest turnarounds of your career. Which episodes from your life helped you build the necessary skill-set?

Having led three turnarounds before this, I knew I could fall back on my prior learning. I’ve seen that any endeavour, approached holistically, with sincerity and diligence, leveraging the combined skills of the team could be accomplished successfully. I learnt from my college days as president of the students’ union that taking the right decision rather than pandering to popular opinion was the only way of ensure that unresolved issues do not continue to pop up from time to time. I learnt about thrift when running a start-up and how return on resource has to be maximised. I’d seen my reporting manager in an earlier assignment use simplicity and brevity in communication to amplify organisational impact. Life’s journey certainly is about the relentless pursuit of learning, isn’t it?

Turnarounds need a short idea-to-implementation loop. How do you ensure it?

No doubt about that. A flood of ideas need to be crystallised into a clear, imaginative plan and executed with exacting precision. This requires a machine-like and almost boring devotion to work and discipline that elevates rote to habit. Simultaneously, it requires an overt organisational culture of performance that precludes the need for micromanagement at every level, while systems ensure outages don’t go unnoticed or unaddressed. It’s also about progressive sharpening of plans along the way with the end goal unwaveringly in our sights.

You now have operations in eight global hubs. Which strengths of AGC Networks did you leverage for this global expansion?

At AGC, we accelerate our customers’ business. That implies we aspire to ensure Return-on-Technology-Investments (ROTI) for our clients. We do that by looking at the customer’s technology landscape embedded with solutions from a variety of OEMs (Original Equipment Manufacturers), across the four technology quadrants we play in (Unified Communication, Network Infrastructure & Data Centre, Cyber Security and Enterprise Applications & Services). We help the CIO (Chief Technology Officer) in the difficult task of managing that tech layer which connects them to their internal and external customers. We help them manage what’s obsolete, what’s getting to end-of-life, different versions, and the new elements, all of which have to interwork. And we try to help him do that within his shrinking budget. That’s what elevates us from being a mere system integrator who pushes boxes, to a solution integrator of choice. We do that with the highest levels of Responsiveness, Execution excellence and Design superiority (RED). That we do that across the globe – America, Middle East & Africa, Australia & New Zealand, Philippines, Singapore and India gives our customers leverage. As does the fact that we have an integrated tech resource pool that enables onshore and offshore delivery and the fact that we represent the best global brands. Of course, we have to overcome the challenge of resource availability in our quest for profitable global growth.

What is your idea of leadership? How do you inculcate it in the next line of leadership at AGC Networks?

In my mind, leadership is about winning the respect of all our constituents – our customers, employees and our partners; we call it the triangle of equity. That sense of leadership has to pervade all levels in the organisation for us to move mountains. It extends to all of us being the protectors of the brand AGC, which stands for fulfilling commitments. We try to reinforce that in everything we do. In essence, we are working at becoming a ‘charismatic’ company, whose customers and partners really want to deal with AGC, and whose employees know that the creation of a great company is the work-in-progress.

How do you keep yourself organised to achieve maximum results?

Being organised in my book is about the discipline at work that enables internal and external responsiveness. It’s about clarity as opposed to ambiguity. It’s about no rework. It’s about setting the example and managing time to include all priorities. And it’s about fitness so that I’m not short on the energy necessary to run a global business.


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