13th Express Technology Senate: Technology companies have to be run by technologists, says Reliance’s Jyotindra Thacker
Jyotindra Thacker, president (technology), Reliance Industries, is someone who is not often spotted at industry events but has a sharp eye on technology…
Jyotindra Thacker, president (technology), Reliance Industries, is someone who is not often spotted at industry events but has a sharp eye on technology and is considered a master negotiator. An alumni of IIT-Kharagpur, he has been with RIL for over 25 years now. Thacker was awarded the Technology Senator of the year award at the 13th edition of Express Technology Senate recently, post which he had a long and candid interaction with Express Group’s Wholetime Director and Head – New Media, Anant Goenka, where he revealed the reason behind the delay in the launch of Reliance Jio’s services as well as why he believes that technology is best handled in-house rather than outsourcing it to vendors.
Excerpts:
We didn’t formally announce your coming for the event after you were chosen for the Technology Senator of the year award. And when we did, all the response which we got from people here was, “Really? Is JT really coming?” So, JT, why are you so elusive?
Lot of people wonder why I do not attend events. Lot of people want to make a good resume, put it on Google. They would like to change their job every three years. I have been with Reliance for over a quarter century now. I don’t need to be everywhere. We have been buying technology from all the vendors you have talked about. If I am everywhere, all the vendors will pile on me and it is very difficult to avoid them. So it becomes easier not to be there.
My team is doing things in a very quiet way.
Today, you have a reputation of being a master negotiator, from whom one should learn the art of negotiation. Do you accept this title?
I don’t think I am a master negotiator. I always feel that whenever I finish a deal, I have left something on the table.
You are always under pressure to close deals fast enough. Sometime you feel you have done good enough and sometimes not. I don’t know how this impression has built up of my being a master negotiator.
In terms of project delivery, wherever engineering is involved, the speed and efficiency at which it works at Reliance, is often far superior to anywhere in the private or government sector. The Jamnagar sealink, for instance, is four times longer than Mumbai’s Bandra-Kurla sea link. Mumbai took 10 years to complete, but your Jamnagar sealink took just one-and-a-half years. What is the secret of making things work so fast?
We had almost completed the refinery at Jamnagar. As regards the 11-km sealink at the refinery, about six months before its construction was to begin, the contract ran into trouble as the Dubai vendor to whom we had given the order wanted more money for the project. We renegotiated the contract. Even at the enhanced price, it was still cheaper for us to do it rather not do it for three years and keep changing the contractor. We actually paid an extra price and got the work done. Unlike the materials used in the Bandra-Kurla sealink, which were constructed on-site, all materials used for the Jamnagar sealink were constructed off-site and then put there. As far as engineering at Reliance is concerned, we spend lot of time on planning. What Mukesh Bhai (RIL chairman Mukesh Ambani) likes is you get 85% right and then order all the materials required. Even if you go slightly wrong, it does not matter. If you are doing a large project, like refinery, which could otherwise cost you $5 billion to $6 billion, you at least end up spending $4.5 billion on equipment procurement. You may be buying it at a price, but you save on time. The Mathura refinery, then with a capacity of 6 million tonne, was the largest in India and took eight years to complete. By the time we finally got involved in engineering for the Jamnagar refinery, we had 27 million tonne of refinery project. We used to start ordering the moment we needed things in advance in record time. We used to train local people for the welder’s job as most of the welders for refinery were in Saudi Arabia and we could not have afforded to pay them in dollars and dirham. There was no other short cut. We build the project in record time.
Also see: Glimpses from the 13th Express Technology Senate
As Technology Senator of the year, what is the advice you’d give a modern CIO today?
I believe, keep management away from the technology decisions (Audience applause). If they start getting involved in technology, you can never decide. You have to prove to them faster and make sure you always talk to them about business. I am fortunate that in my case Mukesh Ambani gave us the freedom to buy any technology that we wanted, at whatever price. He has confidence in us that we would not block the money. We do lot of experiments. We have a laboratory that keeps trying out various technologies. Sometimes we succeed and sometimes we don’t. There are companies who claim to be good in technology but outsource it in the end. This is not the case with us. If Reliance wants to use a technology, then it is better to be doing on its own…We would love to do it first on our own and make sure it is perfected rather than let the vendor run it at our expense. If you really want to implement a technology and take value out of it, you should get your hands dirty. Technology companies have to be run by technologists. So if you say Reliance is a technology company then it has to be managed by such people and in that case I think Mukesh Ambani is a good mix of technology and commercial, because he understands and goes deep into reading everything, tries to understand everything.
Everything relating to Reliance Jio has been top secret. It took years to even know what the brand name would be.
Even with the launch date, we have been expecting rollout of services for three years. You said earlier that Reliance is a company of revolutions (polyester, plastic). Is this delay happening because this is Reliance’s biggest revolution yet?
First, let’s talk about the time line issue. We took a bet to go with LTE (long term evolution) technology in 2010-11.
Now we are in 2015. We thought that within three years there will be handsets, devices and chipsets which will make it up fast enough. Unfortunately, these things never came at a price point which Reliance wanted. At the same time, we started getting auctions with newer and newer spectrum. So we also started re-engineering ourselves. From 2300 MHz of 4G spectrum in 2010, we bought 1800 MHz and this year we bought 850 MHz. So now we have to buy handsets and technology that can support all these three bands simultaneously. We approached Qualcomm, which is our chipset partner and vendor, and told them that we would like to follow on this. Fortunately, Qualcomm is also following on the same path.
If you want to launch your business and if you cannot create a dent like a revolution as we would like to call it, then there is no point in doing it. Since handsets were not going to be available at the price point which is affordable to the masses of India, there was no point in launching our business. So we thought we might as well wait for one more year. Now there is a talk of Rs 5,000 handset. I think this is an affordable price point.
Learning lessons from Korea, Japan and USA, we knew that the only way a wireless operator can be a dominant player is with a large amount of spectrum. Today, we also have the largest spectrum bank compared to any other operator in India. We never thought the government would auction the spectrum so fast.
Did you expect Airtel to pre-empt you?
They did what is right for their company. I am sure, we will do what is right for our company. It is an open market so we will do what is right for us.
We all know there would be a whole bunch of apps. There are several apps that are going to be in a Jio device. Instead of hearing these from the grapevine, what can you tell us? Ye Jio hai kya? What are we going to actually see in December this year?
You would see unleashing of bandwidth first. Devices will be at affordable prices. We did not want to just create a dump pipe for others to ride on it. We wanted to basically create some intelligence into the network, and apps and an economy around it. Apps and bandwidth typically go together and that’s when it becomes a viable proposition for the end user also.
Are we going to see cellphones? Are we going to see tablets? Are we going to see television? Are we going to see all three? Are we going to see a personal Wi-Fi? Are we going to see a dongle or like a SIM card? For a layman, what are we going to see?
My feeling is that you will see plethora of devices. You will see MiFi devices coming with a very efficient long life batteries. You will see dongles for sure. MiFi cards, tablets. You will have Wi-Fi tablets as LTE tablets are still not popular in the world.
And the Wi-Fi tablets will work on Android or be your own?
We will first have a Wi-Fi device, which will run on Android and later also on Microsoft.
One critical view or rather the sadistic view of the Jio rollout is that Reliance is an engineering brand, it is an engineering company. All the revolution you have spoken, all the work that Reliance has done is a phenomenal engineering business work. But from a consumer facing likeness and kindness of the brand, Reliance Fresh is your only consumer facing brand in recent times and only last year it was a roaring success. Does this bother you? Does this thought come into your mind that we are doing something very different? We are now doing consumer facing thing, which we have not done for a very long time?
A: This is something our competitors always want to tell ·that you are a B2B brand and a newcomer in the B2C. I think we have been facing such situations very often. This has happened to us many a times. When we were in textiles, people told us not to come in petrochemicals. When we went ahead for refinery or retail and now telecom, we faced a similar situation. We will prove them wrong once again.
