My approach is half full, half empty: Sundhagul

It’s eight in the morning at the Intercontinental hotel in Mumbai and Gwyn Sundhagul is glued to a television set showing Thai forces entering the protest zone in Bangkok where his family lives. Drawing our attention to a high-rise building, he says without the slightest sign of panic, “That’s my wife’s school.” It may be his ability to stay composed in the din that is Thailand’s retail market that prompted Mukesh Ambani to hire this 47-year-old to head Reliance Retail.

The former marketing head of Tesco Thailand is scripting a turnaround strategy for the loss-making retailer and attrition is a major concern. “We did not create a delightful workplace,” says the man who started his career as an unloader in a small retail chain in the US, and went on become a director of Tesco Lotus, Thailand. Five months into Reliance Retail as the head of the value format, Mr Sundhagul spoke about the challenges in India’s retail market in an interview with ET’s Sabarinath M. Excerpts:

You have come to Reliance Retail at a time when the company was struggling in a slowdown. Mr Mukesh Ambani has been banking on your experience and expertise to turn around the fortune of the company. Do you think you will be able to fulfill his wish in the near future?

I believe so. My job in Tesco Lotus was well established. But I left that to join Reliance Retail because I believe that what we have here is one of the greatest opportunities left in the world in terms of retailing. I believe that we can do it. My approach is ‘half full, half empty’. The people who are half empty can come and appreciate the half full. For example, Reliance delivered 1,000 stores in three years, which is unheard of from any retailer; we serve 2.5 million customers every week; we have 22,000 jobs created directly and indirectly... But there was something they haven’t addressed; that’s where I come in and try to improve from half full to three quarter full.

Could you elaborate on your growth strategy?

Strong multi-formats than other retail channels, great focus on hypermarkets, pushing for leadership in fresh foods and growth through world-class infrastructure are the four pillars of our strategy. We have also devised a nine-module business plan to achieve our growth objectives. Business plan includes things like right location, right format, right offer, right price, right support services and right processes.
Retail touches so many lives in many different ways, starting from our customer, our people, our vendor, our community.... Under the plan, the company is adopting a brand expression 'Aapki Khushi Hamari Khushi.'

Can you give me a specific example of how would you do it in the store?

One is to have a simple enjoyable shopping experience. This means easy signage, navigating system, parking, toilet, etc. First is the product range and secondly it needs to be available. This is a big task especially in India because of the supply chain.

There is a perception that you are bringing your former colleagues in Tesco and other retail chains to the top management, much to chagrin of the current top brass. CEOs like Raghu Pillai have already quit. Do you prefer working with a set of known people?

Some of my former colleagues have come on board. We have hired people from Tesco, Azda and Morrisons. Some of them have worked in markets like China and America. Reliance Retail was facing major attrition problems when I had joined. We had not created a delightful workplace. We managed to reduce attrition by half by improving pay scales and reducing work pressure. Every store has a manager. We have benchmarked the salary with industry standards to prevent people from leaving.

Mr Mukesh Ambani’s trusted lieutenant Manoj Modi was instrumental in getting you on board. Is he still active in Reliance Retail?

He is my boss. We have a very good reporting structure. I report to both Mr Ambani and Mr Modi. Reliance has created a core strategy team for retail. You have fought small traders to establish a strong footing for Tesco in Thailand. Do you think Indian kirana players offer a similar challenge?

Retail chains can coexist with kirana players. Indian organised retail industry is just 3% of the total retail market. Retailers can be a major source of supply for kirana shops. That is why we plan to start an initiative to supply products needed for small shops. We will also educate kirana traders.

What’s your understanding of Indian customers? There is so much diversity and their buying habits are different...

That’s why we say we want to follow the customer. We need to understand them; there is a similarity and also difference. We need to address the similarity and also the differences. However when we look at the size of the difference throughout pan India, I think the behavior difference is not more than 10%.

For example, a vegetable is a vegetable, so everybody eats it but you may cook it differently. This is the core and if you get the core thing right then the customer will come to you. And then you cannot stay in that because as they grow, their demands grow too and behavior keeps changing. So we really need to understand the customer and address their needs all the time.