On September 20, the Sewells Group announced that auto industry veteran Michael Boneham had joined its Executive Management Board.
Boneham, who will be based in Sydney, Australia, retired from Ford Motor Co in December 2012, after a successful career spanning over 27 years. He began his career in HR in Ford Australia, has worked in manufacturing and general management roles in Europe, North America and Asia Pacific and Africa. In India, he began as the executive director (manufacturing) of Ford’s facility in Chennai, before moving on to lead the organisation as president and managing director.
In his role as the board member, he will offer strategic guidance to the Sewells Group's executive leadership team while they expand their business globally.
Where does India stand in the automotive retail business, from a global perspective?
Given the surge in volumes, in dealerships and the OEs that have entered India over the past 10 years in particular, there is a significant number of dealerships across all brands. This has created a variety of challenges.
There’s significant more opportunity in terms of customer experience training by the integrated dealer development model that can occur here in India relative to the developed countries like the US, UK, Australia and so on.
The opportunity is outstanding because many investors have come perhaps with a pre-conceived notion but no set bias on how to run the business. The opportunity for OEMs is fantastic in India because they can bring these new people in and inculcate in them a company’s culture and value systems.
Coming to retail systems, it’s like a blank wall and you can work on it. That’s what I find so exciting, the integrated solutions process that Sewells provides. Rather than focusing on the chimneys of skill development in sales or technical, I was attracted to what what I see as the most comprehensive package in the motor vehicle retail space.
When it comes to attracting new dealers, OEMs are doing that quite well. Where does Sewells come in?
Sewells provides an integrated package rather than a chimneyed package. It gives OEMs the opportunity to work with a team that can integrate all of the needs of the business into one company. For instance, business management, process efficacy, business professionalism, in terms of the training of the people.Sewells can partner with the OEM.
What about the impact of Sewells’ strategy on dealerships?
One of their really powerful tools is the performance management teams and groups where they get various dealers in groups to go through and understand and learn and interact and look at benchmarks, not just benchmarks but measurable benchmarks, how are they performing relative to the best in class and then sharing experiences.
How many markets isSewells focused in?
Sewells is focused on Africa, Asia-Pacific, Australia, New Zealand. And so, India, ASEAN, China are big markets. It’s only three years old in China and it has trebled revenues during this period. What I have been brought on to do is utilise my experience in markets like Thailand and India.
From a retail perspective, what changes do you foresee in India’s automotive business?
Global and local manufacturers are focused on developing their businesses in Tier 2,3 and even Tier 4 locations. The model that European, US, Japanese players have used in their own developed countries is not a model that is necessarily going to be successful here. It may be so in markets like Mumbai and Delhi. The nature and the size of the operations, the investments required will have to be scaled appropriately.
That said, I believe there have to be standardised approaches throughout the environment because there’s no reason why a customer from rural India should be treated any differently from one in a major metro.
Sewells’ recent joint venture with NSDC will play a crucial role there, won’t it?
It’s all about preparing a base of skilled individuals for growth that is occurring. One major issue is the turnover rate in dealerships both on the technical as well as sales aspects. The attrition rate has fallen because of the slowing economy. That said, it is still at 20-25 percent. That poses significant challenges for Sewells, for OEMs and the dealer fraternity.
One of the things Sewells can do is integrate reward and recognition systems into their training and development which gives people a level of comfort in staying with a company because they get recognised as being important to the business.
A skilled workforce is becoming a major challenge for OEMs too, isn’t it?
OEMs are attractive to work for. They pay well and offer opportunity for advancement. I think there are new challenges in the supply base because it is more difficult for them retain people than perhaps it is for OEMs.
As the economy grows, it expands people’s aspirations.
A growing economy generates a massive churn. This is why for a company like Sewells, it is critical to adapt to and understand the markets it is working in.
How many clients is Sewells working with in India?
Most OEMs. From a retail perspective, it is dependent on what the OEMs require. Preference from a Sewells' perspective is the integrated performance management available in the system. Some people use it, some only a part of it.
We work with almost all OEMs, particularly with Ford, Hyundai, Volkswagen, Mahindra, HeroMotoCorp. Hero, after they started their independent drive, had to identify programmes and
work with the Sewells to identify what needs to be done to get great outcomes from dealers.
It’s going to be a challenging period for the next probably year or so for retail. That only makes it more critical to retain good people and ensure that that the workforce within the dealership are at a level where they provide a point of difference to attract customers.
SUMANTRA BAROOAH