‘We plan to focus on Tier 1 suppliers in a big way.‘

Rakesh Panday, Global Business Head (Manufacturing), Xchanging Solutions, speaks to Kiran Bajad on providing automakers with PLM solutions. 

What are the key areas that Xchanging is engaged in with the Indian automotive industry?
Our core offerings for the automotive industry are new product development, engineering simulation analysis and simulation Lifecycle Management Solutions, Product Lifecycle Management, Xchanging’s automotive accelerators, transformation sourcing services, analytics services and finance and accounting services. Besides this, we are now looking to provide material compliance services.

What is Xchanging's USP?
Xchanging Solutions India is an arm of Xchanging Group Inc, headquartered in the  UK which notched over $1 billion revenue last year. The key areas where we offer solutions are business processing service, technology and procurement. In procurement we are one of the top five players in the world for indirect sourcing. We also have our own products and we do the entire outsourcing activity of large companies. I handle the manufacturing part which caters to 11 different industries including automotive, apparel, pharma and others. Our prime focus in India at present is for all manufacturing industries including automotive.

We work with OEMs and Tier 1 suppliers to help them in product development, prototype and virtual stimulation. At present, in India, of the top five commercial vehicle makers, two are our customers and we have been engaged with almost all the Tier 1 suppliers in India. Our automotive customers are based in key auto clusters including Pune, Aurangabad, Chennai and Gurgaon.

We have developed our own accelerators for the automotive industry which follow the process including AIAG (Automotive Industrial Action group) which built a complete solution as per AIAG version 4.0 or TS1696 processes.

When help automakers implement the product lifecycle management (PLM) and manage the product data from concept to product development. Many companies are adopting our solutions which help them market their products better, improve quality and bring all the concerned departments inside the organisation into the product development activity.

What is the level of the company's exposure in the Indian automotive industry?
The technology side of the business gets the majority of its business from the manufacturing industry and close to 35 percent of the revenue comes from the automotive industry globally as we have customers in Italy, Germany, UK and US. This includes commercial vehicles, passenger cars and two-wheelers wherein we work closely with Tier 1 suppliers. 

We help companies in their design perspective and 3D modeling to implement PLM, right from the concept stage through till product retirement. 

Similarly in plant production, our system helps generate data on maintenance. We also work in the area of virtual simulation and help companies test parts virtually before they are produced. We also help OEMs to get involved with their Tier 2 suppliers in strategic sourcing.

How you foresee the Indian automotive market turning out for Xchanging, given the slowdown over the past two years?
From the global perspective, this slowdown hasn’t affected us largely due to our diversified nature of business. Also importantly, Indian companies are now opening up and are ready to invest. There is a shift in their approach as earlier only OEMs were willing to invest in processes like PLM, manufacturing execution systems or customer relation management but now Tier 1 suppliers are also open due to pressure from OEMs and also global opportunities. In the last quarter, we have got three major deals with large automotive Tier 1 suppliers and are in the process of getting the fourth. 

Can you name a few of your customers in the automotive space?
We don’t name them due to confidentiality agreements. However, the automotive sector is a promising one for us going forward in the next 2-3 years. In the longer term, we will work with the auto industry not necessarily in core R&D, virtual design and development and simulation, but we will be more into smart factories and the Internet of Things (IOT).

You say you have worked with a leading CV maker in India and helped it reduce product development time significantly.
Yes, the entire product development lifecycle was 18 months. We helped bring that down to 12 months by process harmonisation and application integration, and an  integrated global value chain with partners and suppliers. This involved seamless integration with enterprise systems, improved collaboration among the various business units and accelerated collaborative vehicle development.

Going forward what is your focus regarding both OEMs and Tier 1 suppliers?
This year the focus is clearly on Tier 1 suppliers in a big way. Secondly, we will also move into the process industry. This is a growing sector with mass production but the margins are less. We need to help manufacturers streamline the entire process so that they can earn more. We are also trying to enter into business with two-wheeler OEMs.  

How big is your India operation?
We have about 3,000 people working in India out of 8,800 globally. We are the only company with offices in Tier 2 cities like Solan in Himachal Pradesh and Shimoga in Karnataka.