Business Standard

V Krishnamurthy: The guardian of PSUs leaves behind an unmatched legacy

None of V Krishnamurthy's assignments was easy. He had to battle scepticism, too

V Krishnamurthy

V Krishnamurthy (Jan 14, 1925 - June 26, 2022): Illustration: Ajay Mohanty

Seetha New Delhi
In 1967, a 41-year-old took over as general manager of the BHEL plant in Tiruchirappalli (Trichy). He had been pitchforked into the position after the then GM, R S Krishnan, who was training him for the role, died suddenly. Soon after, the new GM got a bust of Krishnan installed in the factory premises, announced that Krishnan’s birthday would be observed as founder’s day, renamed a school after him and also started a bridge tournament in his name.

“Many public sector managers remain anonymous and uncelebrated despite having done yeoman service to the country. I did not want that to happen in Krishnan’s case,” V Krishnamurthy, who cut his management teeth in that role, was to write 47 years later in his memoir, At the Helm.

Ironically, when Krishnamurthy died on Sunday morning, he would have gone uncelebrated but for those who had worked closely with him. News agencies did not put out the news till very late in the day; his death made for just a single column inside page mention in some business papers the next day; and of the three companies he helmed, the only one that put out a half-page ad paying tribute to him was one that is now a private sector entity. Could it be because he died on a Sunday – a day not exactly conducive to taking quick decisions in the public sector? Krishnamurthy wouldn’t have let himself be limited by such procedural matters – as the above anecdote confirms.

It is quite possible that there was a bit of canny strategy behind that move. VK (as he was generally known) had just taken over from a man who had left behind a strong legacy. Recognising and honouring that legacy endeared him to the employees and they saw him as someone who would not needlessly and mindlessly change things. VK did, however, bring in a lot of change, but he managed to do so without facing much resistance.

That has been a hallmark of VK’s legendary stewardship of BHEL, Maruti Udyog Ltd (MUL) and SAIL. It was his focus on winning people over and taking them along that helped him restructure and transform flailing public sector behemoths (BHEL and SAIL) or set up a new one (MUL).

None of his assignments was easy. He had to battle scepticism as well. In 1972, Prime Minister Indira Gandhi’s first brief to him was to break up BHEL into several smaller enterprises because she felt Indian managers could not administer large ones. Young managers asked him if there was any future for them in the organisation. Almost a decade later, when he was handed over the reins of MUL in 1981, it was believed that the nationalisation was just a fig leaf to cover up cronyism. And when Rajiv Gandhi asked him to take charge of SAIL in 1985, the then prime minister himself referred to it as a big joke and a lost cause. But VK delivered. Each time.

In fact, this is the best counter to the charge that VK achieved all that he did because of patronage from the Gandhi family. Certainly, he couldn’t have managed the operational freedom within the confines of the rigid public sector that he did without strong political support. But if he got more support than other public sector managers, it was because he demonstrably used that support and freedom to script success stories. There were several public sector CEOs who got to the position because of patronage, but they made no difference to the organisations they headed.

The poor image of public sector companies had hurt VK even when he was a relatively young GM. When he found the Trichy plant was having a problem wooing foreign clients, he removed a line that was standard on public sector letterheads: “A Government of India Enterprise”.  But he realised that this cosmetic change was not enough. Trichy was a petri-dish for most of his later initiatives, many of which were a first for the public sector. His management strategy across the three companies he led was a five-pointed one: giving importance to people and treating them with dignity; constant communication with all stakeholders; emphasis on productivity and quality; customer focus; and constant technological innovation. It was the success of the Trichy plant that caught the attention of the powers that be in Delhi and got him the position of chairman and managing director of BHEL.

At BHEL, he brought in a Corporate Plan and introduced succession planning. He weaned the organisation away from overdependence on Soviet bloc technology. At SAIL, he set up a corporate planning department to bring in coordinated policy making. He abolished overtime at a stroke, following it up with a meeting with plant heads and union leaders to explain the rationale. He made the company more customer friendly than private steel manufacturers. Realising that he needed to insulate MUL from political interference, he persuaded O Suzuki to pick up a 26 per cent stake in the company just so that certain crucial decisions would have to be taken jointly. When Rajiv Gandhi shifted him to SAIL, he made sure R C Bhargava was made the managing director. There can be no denying the fact that if someone else had been in charge of MUL in its initial days, it would have become just another failed PSU.

VK was passionate about putting the entire public sector (and not just the companies he led) on firmer ground. BHEL’s corporate plan was the first document to call for more freedom. A draft white paper on the public sector that he authored in 1987 persuasively argued for much greater operational freedom – that paper was never tabled in Parliament. The fact that the public sector never got the autonomy he advocated was a lasting regret with him.

Taking the positions and doing the things he did, VK did make quite a few enemies. He also landed in controversies (including being named in the Harshad Mehta scam) and protracted legal troubles (he was eventually cleared). But this is not the occasion to dwell on them. This is the time to celebrate the rock star of the Indian public sector.

Seetha is a senior journalist and author

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Jun 27 2022 | 1:08 PM IST

Explore News