With a diversified portfolio, Chettinad Group plays a key role in nation building across India in several business verticals. In the past decade, the Group has diversified its interests in manufacturing, trading, logistics, infrastructure development, education (medical and engineering colleges as well as schools) and health care. It is expanding its footprint and operations to a Pan India scale under the leadership of Chairman and Group Managing Director MAMR Muthiah.
Its flagship operation is Chettinad Cement, which has an installed capacity of roughly 20 million metric tonnes and is among the top 10 players in India. It consumes close to three million metric tonnes of various imported and domestic bulk commodities, and despatches about 10 million metric tonnes of cement per year.
It is also the only cement manufacturing company in India to have its own full-fledged logistics division. Because logistics makes up some 40 per cent of the total cost of production for Chettinad Cement, having a dedicated division allows it to exercise greater cost control.
Chettinad Logistics is the logistics and procurement arm of Chettinad Group, which is where COO Sivakumar S comes in. He is a chartered accountant with more than 20 years of experience in commodity trading, shipping, logistics, power generation and supply chain management. Under his leadership, the company is constantly working on improving operational efficiencies, with a focus to reduce total cost of ownership for Chettinad cements and for other end users.
To achieve these goals, he works closely Muthiah, who has carved out clear strategic plans for each of the Group’s verticals. "He is a dynamic leader and an astute businessman who is hands on in the business," Sivakumar shares. "Under his leadership, the Group has diversified into various business verticals. His expansion plans have always been steady, well thought out and sure-footed. This approach has ensured the Group progressed steadily and thrived.
I was excited about the opportunity to transform the operations and to equip it with a new leadership team and updated skill sets.
"He is also supremely focused and disciplined in his approach, and these characteristics helped rein in the urge to expand fast, thereby avoiding the pitfalls of rapid and reckless expansion."
A vital part of Muthiah’s vision was ensuring the logistics division had the right people in charge. "He has been closely observing the changing landscape of the logistics domain. He knew that it was time for the logistics division to reinvent itself under a new leadership and with an inspired team," Sivakumar says.
Muthiah recruited Sivakumar to execute this business transformation strategy in January 2018. "In my very first interaction, I was thoroughly impressed with the clarity he provided for my role as the COO and what his expectations were for the company and from me," he reveals.
I focus on business development, profitability and enhancing market share, and leave operations completely to my team.
"When I joined Chettinad Logistics, I was able to quickly spot the potential of the company to break into the bigger league and set itself up as a Pan India player in commodity trading, shipping and multimodal logistics. I was excited about the opportunity to transform the operations and to equip it with a new leadership team and updated skill sets."
After more than four years on the job, Sivakumar has come a long way in helping to bring that vision to life. "I discussed this plan with Muthiah and suggested that we need to start looking outward in order to achieve economies of scale and help Chettinad Logistics hit its peak potential. He agreed with me and advised me to present the road map for the company, happy that it aligned with his vision for the Group.
"We brainstormed the way forward for Chettinad Logistics and jointly went about the plans of how to transform the company and achieve a respected position of a Pan India player in commodity trading, shipping and multimodal logistics."
Sivakumar reveals that Muthiah delegates completely while offering guidance, support and networking when required. "He focuses more on the big picture and guides us on emerging opportunities, markets, clients, funding and so on, leaving the execution part to me and my team," Sivakumar says.
"We discussed and agreed on operational guidelines on booking business, credit exposures and financing tie-ups. This gave clarity for us in our execution. He helped us stay on our course and to achieve our vision through regular review meetings and brainstorming sessions.
I don’t believe in micromanaging my team, that has been my style all along and it has augured well for my career thus far.
"He gave me a free rein to rejig operations and recruit professionals from varied industries to translate our shared vision into reality, giving us the time required to organise ourselves and hit the road with our unique offerings. He trusted me with the company and has encouraged me and my team to do well."
Just as the Chairman gives him free rein to run his division, so too does Sivakumar trust his team and delegates to them. "I in turn trust my team and I sincerely believe in effective delegation while fixing accountability and responsibility for their roles and deliverables. I don’t believe in micromanaging my team, that has been my style all along and it has augured well for my career thus far," he says.
"I focus on business development, profitability and enhancing market share, and leave operations completely to my team. They figure out the what, when and how."
Granting this freedom also means choosing people who are trustworthy and responsible, and who work together collaboratively. "Once we agree on the deliverables, we set clear-cut operational guidelines collectively along with the team heads. The team heads ensure adherence to the guidelines. Whenever they need to go outside of these boundaries, they come back and check whether we can do it," Sivakumar says.
"This approach frees up my time for strategic thinking and to engage in other corporate responsibilities. I only get into operations on an exceptional basis, but I have always ensure that I am available for my team for any discussions and business meetings."
The scale-up story
Chettinad Logistics achieved a top line of about US$200 million this year and currently employs around 200 people across various ports and branch offices in executing its seven million metric tonnes of volume. The company has been consistently profitable for the past four years. "Our market share and our margins have been improving in all business segments, and we expect this business to grow manifold in the years to come," Sivakumar confirms.
Our market share and our margins have been improving in all business segments, and we expect this business to grow manifold in the years to come.
Under Muthiah’s leadership, in a span of four years, Sivakumar and his team are well on their way in ensuring that Chettinad Logistics is one of the most sought-after Pan Indian players in the commodity trading, shipping and multimodal logistics space.
"We are confident that the Chettinad Group will play its role in nation building without losing focus on the Group motto of ‘Strive, Save and Serve’," Sivakumar adds.
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