'CMAs MUST ADVOCATE THE IMPORTANCE OF NEW MANAGEMENT ACCOUNTING TECHNIQUES' SHRI. S. RAMADORAI is currently the Chairman of National Skill Development Agency (NSDA) and National Skill Development Corporation (NSDC). He recently retired as the Vice - Chairman of Tata Consultancy Services Ltd. He is also Chairman of the Bombay Stock Exchange (BSE Limited) and AirAsia () Pvt Ltd. He continues to be an Independent Director on the Boards of Hindustan Unilever Limited, Asian Paints Limited and Piramal Enterprises Limited.

www.icmai.in You have had many high I believe one should never live in based solutions to address commu- points in your career, please the past; tomorrow is a new day and nity-related programmes. The com- share with us the experience of you will have new experiences and a puter aided adult literacy program your journey. brighter future. There are always set- or IT training for the blind, both de- From the revenue perspective, the backs and lost opportunities in busi- veloped by TCS are such examples. most significant achievement for me ness, but one should not brood over Recently TCS has pledged Rs 100 came in 2003, when TCS became them. crore toward financing hygienic sani- a billion-dollar enterprise. It was an One often has to face personal set- tation facilities for girl students across amazing achievement for both me backs as well and there are two ways 10,000 schools. and my team. to respond: get angry and react, or just Then there are issues of national Beyond this milestone, another keep quiet and perform your job to importance eg. Skill Development prominent achievement was when the best of you ability.. I have always which is both an economic & so- we got our first Burroughs main- followed the latter. It is difficult be- cial imperative. The re- frame computer; it was the highest cause you seem for a while to be on cently started a new initiative called level of technology in the country a dodgy wicket and even your own ‘TATA Strive’ which aims to aggre- then and it took TCS to a completely colleagues begin to treat you differ- gate strengths of Tata companies into different level, putting us on par with ently, but if you are strong internally a scaled up skilling programme. the best. Setting up an office for TCS and deliver on the ground, no one overseas in 1979 as its first resident can take that credit away from you. You are an advisor to the manager, was also a significant mile- I have always put in my best and Prime Minister in the National stone in my career by establishing never worried about failure. I found Council for Skill Development. TCS’ presence in the Western mar- that a bad day was always followed by What are the major initiatives ket. Then, of course, there was TCS’s a better one. taken during your tenure with initial public offering in 2004, when this organization? we raised a billion dollars. That year TATA is always concerned The National Skills Development was also special because TCS received with the issue of Corporate Agency was formed which subsumed the JRD QV Award for business ex- Social Responsibility. How the office of the advisor to the Prime cellence. critical is this to maintain, and Minister in the National Council for Today there is a larger vision that would you highlight some of Skill Development to co-ordinate consumes me. I have chosen to be in the initiatives in this regard? and harmonize the skill development public service focussed on skill devel- The Tata group’s core purpose is to efforts of the Government and the opment in India and this endeavour improve the quality of life of the private sector to achieve the skilling is hugely exciting and challenging for communities it serves globally. If you targets of the 12th Five year plan. me. Even after a career spanning forty recollect ’s statement – One of the major initiatives which we years in IT, I still feel the excitement “In a free enterprise, the communi- have undertaken is to anchor and op- when I take on a new responsibility, ty is not just another stakeholder in erationalise the National skills quali- in this case contributing to the cre- business, but in fact the very purpose fication framework (NSQF). This is a ation of demographic dividend by of its existence”. 66% of the equity competency based framework, allow- skilling millions of Indian youth. of , is held by philanthrop- ing every person to accumulate skills Building a world class organization ic trusts, thereby returning wealth to and capabilities throughout their life- with a sustained human potential has society. The group believes in doing time and to be certified for the same. been the most satisfying achievement. good by being good and that both are This will also help remove the barrier two sides of the same coin. Tata pio- between vocational training, techni- What are the challenges neered many industrial practices that cal education and general education. you have faced to get all these have now become standard, like the Recognition of Prior learning feathers on your crown? How eight-hour working day, free medical skills is another issue which we have did you overcome those bad aid, annual leave with pay, and work- faced and we are working to incor- times? ers provident fund schemes. Last year porate this in the NSQF. The NSDA My family has always been my the Tata Group spent Rs 1000 Cr on is also focussed on rationalisation of strongest support system in anything CSR focussed programs on skill de- the Central Government Schemes that I have ventured into, especially velopment, health and education. under various ministries on Skill de- my wife Mala. She has stood by me Each Tata company has its own set velopment in order to achieve max- at all times giving me the confidence of philanthropic programs and pro- imum convergence and efficiency and courage to chase the impossible. jects; TCS for instance promotes IT across them. The NSDA is on track

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to create a National Labour Market youth are both educated and employ- products and tools. Information Service (LMIS) and has able for the jobs of the 21st century. There is a lot of scope for Indian already gone live with two modules We also believe that the demo- IT companies in the domestic sector for training providers registry and the graphic dividend that India enjoys also. The domestic IT-BPM sector is candidate registry. This will be a one can be truly leveraged by enabling expected to outpace the country's stop shop for all information on the or skilled people to work in over- IT exports. It's expected to grow by Indian labour market. seas markets. And we are working 15%-17% this year. The growth is ex- with various international bodies to pected to come from e-ecommerce In the last couple of years, benchmark our skilling frameworks and the government's push to boost the skill pool has increased with international standards. technology adoption. remarkably in India, but the job market is still dull. What is your What changes would you like You are also appointed as the view in this regard? What should to see in the IT sector globally? Chairman of AirAsia India be the role of the new Govern- What is the potential of the which is a low cost airline in ment to create more jobs? Indian software industry to cope India. What are the key areas The Government is strongly focussed with the competitive market? would your company like to on job creation and the recently an- Globally in the IT sector ‘Going Dig- focus to become cost competi- nounced budget strengthens its re- ital’ is the most important mandate tive and cost effective? solve. The government's 'Make in for CIO’s. Companies are now mov- Being in India which is a very com- India' programme to make India a ing towards ‘asset light’ models for petitive market, our first focus is to manufacturing hub, presents a huge IT where both the hardware and the ensure that we can maintain to have opportunity for job creation. The software is now owned by the service the edge for today’s cost competitive Government’s emphasis to boost provider. The focus is on using new consumer. We need to allow the com- growth and facilitate investments in technologies and analytics to increase mon man to fly. With a hawk’s eye on high productivity sectors like infra- customer centricity for every compa- operations and ensuring customer structure, manufacturing and related ny. Companies are becoming more satisfaction is key to the growth of Air industries paves the way for creating open with outsourcing design and Asia in India. a vast pool of job opportunities in product development to Indian IT Aspects like lean Management is the coming years. The Government is companies. This is a major change as an important theme which we follow also focussed on Entrepreneurship as the Indian IT industry is slowly mov- in Air Asia, right from the size of our it realises that entrepreneurs will help ing from a cost advantage to a value management team to other non-op- create jobs and has launched several advantage which means that more erating staff at airports. We also are fo- schemes to support and encourage high value work is coming to Indian cussing a lot on customer self-service them in India IT companies and their focus is on with options like kiosk printing and Of course it is important that the providing value and quality to the self-baggage drop. At the same time skill pool continues to increase and is customer. NASSCOM has recently we ensure that we do not lose sight employable. For that to happen, rel- forecast that the Indian IT industry of our primary goal – Customer sat- evant skills training and skills upgra- growth in the coming financial year isfaction. dation is necessary. The Government would be about the same as in the is thus focussing on the demand side current one around 12-14%. Are the Indian companies (by creating more jobs through initi- Focus on IP, new technologies and actually taking a major part into atives like ‘Make in India’ and on the having ‘innovation centers’ are key to the global competition? Can supply side (by launching ‘Skill India sustaining growth in this competitive you enrich us with some Mission’) to ensure that both sup- market where cost is no longer seen examples from your experience? ply and demand can be met in the as a differentiator. Indian IT compa- Yes, Indian companies are certain- forthcoming years. In fact our Prime nies now are focussed on ‘non-linear ly taking a major part in the global minister has explained how Skill In- growth’ which is growth not just by competition. There are two ways to dia needs to be closely coordinated adding more people but due to new expand globally, one is to acquire with Make in India to ensure that our innovations; value added services, other global companies and the oth-

50 the MANAGEMENT ACCOUNTANT JUNE 2015 www.icmai.in er is to grow organically and expand. ing better overall profitability as now tributed to India’s growth. The Tata group has adopted both they can detail analysis of profitability of these approaches. It has acquired at a product level. With an improved Would you like to give any marquee global brands like tea, Management accounting system, message to those young aspir- Jaguar and Land Rover, Corus steel companies can access reliable and ac- ants who wish to choose career to mark its presence in the world. curate cost information on a timely in software industry? Then there are group companies like basis and significantly improve their The broader and more enduring TCS which is currently in the top 5 decision making process. role of education is to prepare stu- IT companies in the world and has a As Cost and Management ac- dents to face the challenges of life. It global presence across all 5 continents. countants, I would call upon all of is important to make use of school Companies like Sun Pharma and you for advocating the importance life to find out where your interests Dr. Reddy’s labs are amongst the top of adopting such management ac- lie. In today’s world it is important pharmaceutical companies in pro- counting techniques across com- to have the right focus in order to viding generic drugs and molecules panies. Many times, companies are be successful. The herd mentality worldwide. Mahindra & Mahindra not aware about the various tech- of dashing towards the software in- is among the top five tractor brands niques available or do not want dustry no longer exists. One of the and top three tractor manufacturers to change their old practices. It pain points in the IT industry is the in the world. Hindalco is also among is useful to create a business case lack of employable students availa- the world's leading producer of alu- showing the benefits of adopting ble immediately after graduation. It minum rolled products. Suzlon is the the new accounting technique. I is important that young students are fifth-largest wind turbine manufac- also take this opportunity to ap- abreast of the latest happenings in turer in the world, with a 10% market plaud the ICMA for playing a big the software industry by regularly share, and India's largest turbine man- role in advocating the importance following the news, media and in- ufacturer. of Cost and Management account- ternet. Innovation ecosystem and Sustain- ants in India With start ups growing so rapidly ability at the heart of everything we there are always new technologies and do is coming into being in the coun- What policy or other initia- frameworks emerging. The Software tr y. tives would you expect from the industry itself is a very vast field and Government to boost the there are numerous options available Cost Management always software industry? where students can apply be it in the plays a pivotal role to gain Our Hon. Prime Minister has business process industry or software competitiveness for the indus- sought the counsel of the IT indus- testing, mobility, enterprise applica- tries. Please suggest in what try to help the government achieve tions and Analytics to name a few. I ways Cost and Management its goals for Digital India, calling for would also encourage the youth to Accountants may offer their increased innovation and greater become entrepreneurs given the vast expertise more effectively in this focus on the global challenges of opportunities out there in a country quest. Cybersecurity. like ours. E-Commerce is booming Management accounting techniques With the Government focused in India and provides numerous op- such as activity based costing, bal- on improving the ease of doing portunities for entrepreneurs to start ance scorecard, target costing and business, there is an implicit focus their own venture. The Government value chain analysis have been in- on e-Governance and digitization is also encouraging such start ups and strumental in creating a rigour and of various regulatory practices. This has allocated funds for them as well. competitiveness in industry across in turn will give rise to huge oppor- Hardware, Software and Embedded the world. Companies now are bet- tunities to the software industry in systems are the future and Indian En- ter able to understand their costing India. Already projects like Adhaar, trepreneurs must be passionate and structure and doing activity analysis e-passport , MCA have been game willing to take the risks. can also find out which activities are changers for India’s economic pro- At the end of the day, my most im- value creating v/s consuming cost. gress and are excellent examples of portant message to the youth today This also helps in companies achiev- how the software industry has con- would be ‘Dare to Dream’.

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