23 October 2019

Interaction

India represents a huge market opportunity for Trimble

 

Founded in 1978, the Sunnyvale, California based Trimble applies technology to make field and mobile workers in businesses and government significantly more productive. The solutions are focused on applications requiring position or location—including surveying, construction, agriculture, fleet and asset management, public safety and mapping. STEVEN W. BERGLUND, PRESIDENT & CHIEF EXECUTIVE OFFICER, TRIMBLE who completed sixteen years at the firm this March, is credited with jump-starting the company’s comeback at a time when it was seen to be losing money with its focus on ‘the short term’. In Circa 2015, Berglund is a big-picture thinker and India figures in a major way – both short and long term - in his vision for growth of the company.  He spoke exclusively to SHRIKANT RAO during a flash visit to Mumbai recently.

 

What brings you now to India? Give us a sense of the key areas of company’s focus and the new businesses you are eyeing?

Earlier in the week we opened an office in Dubai and it made eminent sense to fly across to India which is just across the water. But seriously if you look at the traffic of senior management from Trimble to India it is because they want to get themselves better educated about the country. We need to know more about this market. We do have to reinvent ourselves a bit within the Indian context. We view India as a market having significant prospects but to realise that potential it requires a level of learning which is not necessarily automatically available to us. We have to kind of work at it and that is what we are doing. 

In general what Trimble here, as elsewhere across the world, attempts to do as a company is to apply technology to the work processes in  fairly traditional industries like construction, agriculture or transportation and attempt to transform the efficiency, productivity, safety and quality of the work process  through the use of technology. 

The core businesses, which account for a sizeable amount of turnover for our company include building construction, which is the primary theme of the day, also heavy civil; there is agriculture, arguably the most successful business for us in the last 10 years; there is transportation and logistics in terms of bringing telematics into the enterprise in a serious fashion. Then there is geospatial which is everything for us in the sense that it was the foundation point of Trimble’s business for 37 years now – and which is increasingly referenced. However, in addition to that, we are now also looking to develop new businesses that are under development, are much smaller, but represent platforms of growth like electrical utilities, railroads and water management where we believe Trimble can bring in technology.

 

The government of India has an ambitious plan for development of infrastructure.Where do you see Trimble fitting into these plans? Could you offer us a glimpse of your areas of business convergence here in India, and possible engagement going forward?

We see India as a market for all of the five core businesses of our company, plus what we would call the emerging businesses within Trimble. Our product base matches the needs of the country very closely. The current view of India which can be emphasised by the recent changes in government is that of all the four BRIC countries, India at the moment is the most interesting and dynamic from a market opportunity perspective. The momentum here is stronger than elsewhere in the BRIC countries. We have focused more attention on India because we believe in the next three or five years, India represents the largest geographical opportunity available for Trimble. To give you a sense of the importance we attach to India we currently have about 800 Indian employees of the total company employee population of 8,300, which is 10 per cent of the group. We would hope 10 per cent of the revenue coming from India at some point in the future.  In the strategic, longer term, sense I believe from a development standpoint Trimble can make a significant contribution to India with its capabilities and ability to impact areas like construction, or agriculture or transportation logistics which would be in line with the country’s ambitions in those and other areas.

 

Tell us about the value the acquisition of Tekla and Sketchup has brought for your company?

I would say the acquisition of Tekla was one of the transformative moments in Trimble. Tekla in India is doing a great job with consistent growth. I was told that they will soon have their new Tekla Structures Ver 21 launch through multi city customers’ interaction. That is our core strength, we don't ship box rather we work with our customer. I am very optimistic that our Trimble Buildings offering with end to end solutions for the construction industry in India will get good appreciation and acceptance.  Sketchup has done a lot for Trimble. It is a consumer product which has been liked by all. With the free version we have made millions of friends across the world. Sketchup has extended Trimble to a much larger universe. Among potential users it has been very successful for us.  We will continue to evolve the product going forward.

 

What are the areas of development across India in which you see the opportunities?

Certainly the primary areas of focus would be physical infrastructure like roads, rail and waterways. In terms of putting physical infra Trimble can make a major contribution. Transportation is another area of relative focus. We acquired the Tata Telematics business which gives us an Indian development capability and platform. There are discussions going on for other strategic acquisitions. We are evolving product capabilities that are appropriate to the Indian price points and certainly contributing to the logistical structure of India from a transportation standpoint. The secondary focus would be on agriculture but that would be in the next 5-10 year context.

 

Price points are a touchy issue here in India. How easy or difficult is it for companies such as yours to handle that?

It’s never easy. We have to avoid the temptation of simply pursuing costs.  Trimble’s solutions are not the cheapest, but we were still selected by clients because of their understanding of the total value vs cost offered. We have to be absolutely principled as a company in that we must offer solutions for India which work. If we cannot be the cheapest we need to be disciplined, must ensure that the products and brand we bring to the market are absolutely reliable, and work well. 

 

It is interesting you mention agriculture earlier as occupying a huge chunk of Trimble’s business pie.  Agriculture has been the traditional mainstay of India’s economy.  In that context what role do you expect your firm to play in Indian agriculture?

At this point of time our impact in agriculture here in India is moderate because of Trimble’s historical product approach, which is guiding farm equipment; it is optimised around relatively large farms which does not make us relevant for Indian farm segment. There are smaller farms in India. But agriculture as an area will be going through a profound change over the next five years. It is going to become much more of an information problem than it is of the traditional in terms of people utilising information to make agricultural decisions. Starting from the premise that every square meter of land under cultivation has a story associated with it, such as what are the soil conditions, yield, water conditions etc., a lot of that intelligence can be applied to the smaller farms in India. A cloud based solution which is fairly prescriptive for farmers operating on a small scale could help them make real time decisions.

 

What is the intelligence you have gathered as a prelude towards marketing your products and solutions in India?

Trimble is not the world’s greatest marketing company in the classical sense of having done something like a big marketing survey or analysis. Whether in construction or agriculture what we do is to connect with the marketplace, engage with farmers and contractors and by reacting to their needs we discover the marketplace. There is a lot of trial and error involved from which we learn to do better at the job. Trimble’s value is predicated on two things: knowledge of the domain plus technology.

 

What is the view obtaining from the US of the size of the India opportunity? Have you assessed it? Do you have a specific India plan?

Let us just say it is big. We were a $2.5 billion company last year. Right now India represents a small percentage of that figure. I would hope that over the next five years India will represent a significant amount of the growth that we achieve as a company. We see India being a large market. As regards your question: Does the company have an India plan? Probably not. We are not a brick and mortar heavy company. We are not a company that believes too much in what is called the corporate style master plan. We leave that is for IBM and others who are so big that they need the discipline of a master plan. At the same time we are a company that is disciplined, with financial transparency and organisational flexibility.  Our emphasis is on having people looking at the market opportunistically every day and reacting to it. We don’t say by 2020 we will achieve X or Y or Z – in the case of India it is too dangerous to do that – but we know we will get bigger and more successful by 2020. Without being fixated on a masterplan we believe in getting there.

 

Are there technologies on the anvil which you would like to introduce?

As a company we have to be highly opportunistic. The current environment is very dynamic and very much encouraging for the introduction of new technologies. India as a country has a very real opportunity to leapfrog generations. That will come sooner than later with a very supportive political and business environment.  I am sure the current government is aware of the importance of the technology platform to get its infrastructure ambitions in place. On our part we will be happy to support them in that mission.




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