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INTERVIEW VIEW InterviewINTER Understanding Harman An Interview with Dinesh C. Paliwal, Chairman, President, and Chief Executive Offi cer, Harman International Industries, Inc. Given the global size and scale of Harman, is value this and have rewarded us with $13 billion there an effective understanding and aware- in new orders for their future car audio and info- ness of how this company has evolved? tainment solutions over the next fi ve or six years. I don’t believe so, because for a long time, How challenging is it to keep up with Harman has been run as a holding company with the ever-changing technology? a series of acquisitions made over time, but they You have to be able to read future trends, were left alone to operate as if they were in- anticipate your customer’s emerging needs, and dependent companies. The company grew from engineer the solutions before anybody else. home audio components, to professional equip- Clearly, there is a massive convergence hap- Dinesh C. Paliwal and a Harman speaker ment, to ultimately car audio and the new world pening among consumer devices in the offi ce, of automotive electronics and infotainment. at home, and in the car. Consumers no longer EDITORS’ NOTE Dinesh Paliwal has served as Although the company was called Harman view their living room, workplace, and personal President and Chief Executive Offi cer of Harman International we hardly had any presence outside devices as separate domains. As devices become International since July 2007. Founding chair- of a few OECD countries. I have set the goal of more portable and content is increasingly digital, man Sidney Harman asked him to also take making this company truly global and we now connectivity is fast becoming a fundamental ex- over the role of Chairman in July 2008. have signifi cant presence not only in the U.S. pectation and lifestyle requirement. Prior to joining Harman, he spent 22 years and in Germany but in emerging markets such as If you look at how we used to build info- with ABB Group where he held the dual role of China, Brazil, India, Hungary, Mexico, and Russia. tainment systems just a few years ago, the think- Group President and Chairman/CEO-ABB North How broad is your target market in ing was that the car needed a massive hard drive. America. He moved to Beijing, China in 1994 to terms of your product offerings? But the more content you stored on it, the slower establish ABB’s operations in China and North It’s broad, because we’re touching a lot it got, and the higher the chances of losing ev- Asia. He was then asked to relocate to the com- of consumers. Our total available market is erything in one shot if the drive crashed. We’ve pany’s headquarters in Zurich, Switzerland. approximately $20 billion. We currently radically changed this approach: multimedia, navi- He was the youngest person and the fi rst Asian serve about 80 percent of the luxury car mar- gation, and traffi c information content is no longer ever to join the ABB Group Management Board. ket, including automakers such as Audi, BMW, stored in the car but hosted in the cloud and trans- During the historic turnaround of ABB begin- Ferrari, Mercedes-Benz, Porsche, Toyota/ mitted down to the vehicle or into the home and ning in 2002, the company’s board selected him Lexus, and many others. We equip about 60 into handheld devices on demand in real time. to run the global Automation division, reporting percent of the world’s cinemas and are called Does the fi nancial community under- directly to the Chairman. He earned a Masters upon for large scale audio events such as the stand this brand? degree in Engineering from the Indian Institute of Olympics or World Cup, and venues such as This is not the same company we were Technology. He also earned a masters degree in Yankees Stadium and Shanghai Grand theater. five years ago. Most people don’t know that Applied Science and Engineering and went on to Our legacy of excellence and innovation has we have transformed from an analog hardware earn a masters degree in Business Administration, earned us two Grammy awards and one Oscar. company to an integrated, digital, and software both from Miami University (Ohio). Until he left I’m very proud of these achievements. driven products company. We are a transforma- ABB in 2007, he also served as Chairman of ABB How have you been so successful in not tive technology provider rather than a traditional India Ltd. He served for three years as Economic losing your innovation edge and how critical auto parts manufacturer. Our systems for high- Advisor to the Governor of Guangdong Province, has that been to the strength of the brand? end German cars, for example, contain nearly 4 China. In 2010, he was named Metro New York I maintain a healthy paranoia about new million lines of code written by Harman. Entrepreneur of the Year by Ernst & Young. technologies that might disrupt our business. To When this opportunity presented it- keep our edge, we have done a lot to nurture self, what made you feel it was the right fi t? COMPANY BRIEF Harman International a culture of innovation with programs targeting I had the benefi t of excellent training and men- Industries, Inc. (www.harman.com) designs, every level of our organization. toring of 22 years in six countries with ABB to take manufactures. and markets a wide range of Each quarter, we recognize a few employ- on a challenge like Harman. However, I was leav- audio and infotainment solutions for the auto- ees with a Harman innovation award for break- ing a $30-plus billion company and Harman was motive, consumer, and professional markets – through ideas. I have also set up a corporate one-tenth the size, so I was concerned if Harman supported by 15 leading brands including AKG®, technology group, which brings our top re- would have the technology infrastructure, man- Harman Kardon®, Infi nity®, JBL®, Lexicon®, searchers from across the world together quar- agement talent, and vision for profi table growth. and Mark Levinson®. More than 30 million au- terly to brainstorm and prioritize the technologies I have been pleasantly surprised with the tomobiles on the road today are equipped with we want to explore and invest in. At the board technology, and saw immense opportunity for HARMAN audio and infotainment systems. The level, I established an Innovation Council to gain brand building and brand proliferation. company has a workforce of about 12,000 peo- a broad perspective on global technology trends. It’s been a great journey so far. With our global ple across the Americas, Europe, and Asia, and We have also been pushing for early identifi - expansion and stronger innovation focus, we’re reported sales of $3.6 billion for the 12 months cation and patent fi ling, and have built up a port- well positioned to play a starring role on the stage, ended March 31, 2011. folio of over 3,500 active patents. Our customers at home, and in the car for a long time to come.• 56 Leaders posted with permission. copyright © 2011 leaders magazine, inc. voLume 34, number 3.