Management mantra of Mahindra Group chief Anish Shah: Focus on few, but think big

Anish Shah, CEO of Mahindra Group (Courtesy: Reuters photo)

In five months, Dr Anish Shah will complete five years as the head of Mahindra. And the group's run in these past five years has been phenomenal: its revenues have doubled since April 2021 when he took over, group profits have grown 10x and the market cap of the group is up by 13x in these five years

The obvious first question to Dr Shah in our chat with him for our series 'Latha & The Leaders' was : What did you get so damn right? Shah was self-effacing. Said that the 'the foundation of Mahindra group was already very strong' … "Mahindra Research Valley established 25 years ago by Anand Mahindra in Chennai has proved to be valuable to us today".

But what he does different, I insisted. "We did less," he answered.

"It was important for us to first exit a few areas that were in some cases never going to be profitable because it was not just about the profit or loss, it was also about the management bandwidth," he said. "Exiting some areas  released management bandwidth that was being dedicated to those areas. So it freed us up.  It was more of time allocation than capital," he said.

Shah pulled out of several JVs and areas that the group had gotten into in the last decade. The JV with SsangYong Motor, the South Korean SUV maker was the most significant exit. Other exits included GenZe, the US-based electric two-wheeler company, Peugeot Motorcycles, Mahindra First Choice Services (the used-car services business), GippsAero, the Australian small aircraft manufacturing subsidiary of Mahindra Aerospace. 'Saboro' dairy business was also sold off.

"Doing less is focusing on a few key areas that really matter and allowing us the bandwidth to be able to execute that flawlessly," Shah explained. "They go together."

Once that phase was done, we pivoted to growth … We encourage our businesses to come up with bold plans … we tell them think big … "We tell our businesses to focus on things that you can do well; do it very well & execute flawlessly," he said.

So that's the second golden rule in Shah's management book. Focus on growth and be the best in your chosen area.

The third golden rule for Shah is clearly people, developing leaders as he puts it. Shah was most generous in his praise of Rajesh Jejurikar, ED & CEO of the auto and farm businesses – Mahindra's flagship products. "With Rajesh coming in as CEO for the auto and farm businesses, he's made a huge impact," said Shah.

One winning factor for the Mahindra SUVs has been the sporty design, the youthful panache! What does Shah look for before he gives the final tick to a model, we asked.

Once again, the self-effacing Shah came to the fore:  "I would give Rajesh a lot of credit for the design success of the new SUVs. Pratap Bose, our design head, Velu, head of product development have all got the auto business to where it is … This team has really done extremely well in getting the auto business to where it is right now."

Clearly, not just talent spotting but also generous recognition is part of Shah's third golden rule.

"A number of new CEOs have come from within the group which is a change from bringing in CEOs from outside in the past and we're putting a lot of focus on talent development at every level in the company to be able to groom them to take on roles that they would want in the future," he added.

Anish Shah has another invaluable quality of a leader: the ability to smell the market trend. His biggest success was the ability to smell that the great Indian middle class is moving from the small-car-kitne-deti-hai category to one that aspires for big spacious swanky cars. After that correct market spotting, execution achieved the rest.

Here's yet another trend Shah spotted for us - The rise and rise of semi-urban India. "We play in 70% of India's GDP growth; Over the next decade we are seeing semi-urban and rural India be a key part of that growth," he said.

"We can see the consumers in rural and semi-urban India are now demanding a lot more and therefore we need a much better set of products for them. Income levels have gone up. India is growing across the board and this is something that augurs very well for all companies in India," he argued.

And finally, what’s the 5-year-hence goal for the group? "We want the Mahindra group to be among the top 50 most admired companies in the world," he said. "Multiples will go somewhere from 3x to 20x somewhere in that range for growth this decade for each of our businesses and maybe plus or minus a little on that one but as we get the final set of numbers you will see a very significant growth across each of our businesses for this decade," he concluded.