IIMB Lunch with Leaders - Ravi Thakran

Had a fascinating lunch session with Ravi Thakran (Group President South & South East Asia and Middle East at LVMH) as part of the IIMB lunch with leaders series. 

Sharing a paraphrased summary of some of his comments: 

Foundational Experiences:

Ravi was a self professed socialist SFI member with the likes of Sitaram Yechury as peers. He emerged out of a 4 day hunger strike to appear for his IIMA interview. Ravi explained his evolution with the quote, "If you’re not a communist at the age of 20, you haven’t got a heart. If you’re still a communist at the age of 30, you haven’t got a brain." He acknowledged those early influences when he made a case for capitalism with conscience. 

What fascinated me most was the amount of empowerment and the absolutely fluid nature of his early career. No doubt that those experiences helped him flourish as an individual. In our current times of compliance and bureaucratic setups his intrepreneurial acts may be more difficult. When pointed about this he acknowledged and remarked that passion and drive were key and I was in agreement. You may need a lot of things to succeed but without passion and the drive getting to the next level will surely be more difficult. If nothing else it would be the secret sauce that would help you get noticed for bigger things in life. Also his experiences in militancy ridden Jammu and Punjab would have built his people skill muscles. 

Structure & Common sense:

He was sent to the UK to sell Titan watches at a time when you had to declare on your passport the amount of forex you were carrying. Perhaps he was amongst the very few in the Indian private sector with that experience. In UK when faced with the difficult job of selling Titan watches he found the opportunity to sell jewellery. India had restricted the import of watches and in response the Swiss did not allow Titan to participate in their trade shows. So he registered as a British company and got Titan its display booth. 

The results Ravi has achieved seems magical but there is an apparent method to things. "Charles and Keith" is one of the ventures that he is invested in. When the company wanted to enter the Chinese market, its initial plan was to be present in 8 cities with two stores each. The advise given to the guys at C&K was a single focused entry into Shanghai and a preparation time of 2 years to handle the specifics of China's multiple seasons. And the Chinese entry was managed by Charles who was one of the C&K brothers, to ensure execution responsiveness.

There were hourly targets at the Sephora stores and I cant imagine the structures in place to support it. I got a sense that these things were done with a parallel empowerment of the people. For example if a store hit its highest sale ever then the staff was allowed to close store 30 mins early and have a champagne party within premises. One store had that party 69 times in an year and the CFO wasn’t pleased. Ravi persisted because of its impact on morale. 

He spoke well of the Sephora and the Gentle Monster stores in Ion Orchard. The products in the Sephora stores were beautifully curated and almost all the available options could be tried in store. The Gentle Monster store was even more amusing; it looked more of a museum than a spectacle shop. The number items available in the 5 month old store was "limited" for the lack of a better word and I wondered if it was enough to cover for the high ion rentals. But then the price range would be value for money for the intended audience. In addition the capability of the front line sales force was stupendous and I was also impressed by the ability to shape the frames to get the perfect fit for your individual face structures. 

He made a beautiful comment about the difference in incentives between private equity and corporate roles. Despite the incentives Ravi highlighted a desire for some corporate engagement perhaps with an intent to stay grounded. 

People Skills:

He was at Nestle's Moga plant for a few months during which the miscreants hijacked the cash meant for settlement. In those days the management training used to last much longer than our current times and Nestle had a 18 month training stint. He made an impact and someone senior offered him the role of the plant manager and cutting down his training period.

The Titan trade show incident I mentioned earlier invited some Swiss fury and the way Ravi managed the repercussions helped him get a job offer. The champagne incentive and a few other anecdotes highlighted how he empowered people under him. In the early days the top management of his Asian operations was deficient in Asian talent and am sure the political handling of the situation would have been tough. It seems that his establishing personal relationships proved key; These relationships were further leveraged during the setup of his funds. The funds story also highlighted the impact of state policy; The Chinese operations were generating a lot of cash but repatriation was not allowed so LVMH and others were forced to invest within China which surely would have had a multiplier effect on its economy. 

Future

He also made the very powerful comment that Asia will see some significant Brand creators in the next 15 years. Talking about future he highlighted the following three key trends:

• Ethical Sourcing and transparency about the origins of the product. 
• Ability to customize to the unit of 1.
• Possibilities thrown open by the interactive media. 

The customization capabilities are already live and these are things that in my opinion could potentially undermine the scale advantages of China. Speaking of US he pointed that the Bush years' focus on the two wars had given the Chinese some significant advantages. He felt that the US leadership gaps could potentially give the Chinese more openings in future. About India, Ravi commented that it has all the ingredients for success and need is to deliver.

There were many more beautiful anecdotes in but one made a special impact when he highlighted how he bought the subscription of the "South China morning post" for all the members of the Indian Parliament. This was done with the intent of familiarising the Indians with the progress the Chinese were making but apparently only 2 wrote back and I would love to know who those two were.