Candida Moraes

The precision engineering division of Titan is setting new benchmarks for style and substance

"Titan is an international company, which happens to be in India.” David Ogilvy, founder Ogilvy & Mather, once said.

Titan has always recognised and lived up to the strength of the above statement. Steeped in international business practices and built to global economies of scale, the company spares no effort to meet the expectations of its stakeholders across the world. And keeping the banner flying is Titan’s fast growing precision engineering division or the PED.

From complicated circuit boards to precise dashboard clocks, PED has been stirring up quite a revolution. Established as an SBU in June 2003, it has carved a niche and name for itself that few can match up to. It supplies precision engineering products for a range of industries and is increasingly becoming the supplier of choice for some of the best companies in the world.

Titan Industries expects PED to be a Rs-300-plus-crore company in the next four years. “For the year 2005-06, the division clocked Rs24 crore, moved up to Rs38 crore in 2006-07 and is looking at achieving Rs80 crore in the current financial year,” says senior vice president and business head of PED, BG Dwarakanath.

The first choice
"The main aim behind setting up the precision engineering division in 2003 was to sweat existing manufacturing facilities and reduce costs,” explains Dwarakanath. One of the pillars of Titan, Dwarakanath has spent 22 years with Titan and is the man behind the success of the division.

Today Titan PED is an OEM of dashboard clocks for car manufacturers in Europe and America, supplies precision components to the global avionics and automotive industry, and builds automation solutions for several industries. The philosophy is simple: “To be a global supplier of choice for precision engineering and automation solution.” At PED, everyone is willing to go the extra mile to achieve just that.

Titan PED implements quality management systems specific to customer needs, partners with customers in development projects and engages with a cross-section of the customer’s organisation for seamless and responsive supply chain. Says Dwarakanath, “We constantly endeavour to enhance the value of our products and services. For example, in the automation solutions business, we leverage our rich experience of precision manufacturing in a mass scale to provide the customer with performance levels of solutions that are beyond the normal standards of the industry.”

No surprise then that Titan Industries is the most preferred global supplier for Ford, one of its main customers. It also shares a similar relationship with customers such as Knorr Bremse, Delphi, etc.

The ring of quality
“The core strength of Titan has been precision manufacturing. We leveraged the precision skills of Titan to set up this SBU and since then, the division has been steadily growing,” says Dwarakanath. This has been largely due to the stringent quality standards and the persistent focus on costs within the division.

The objective is to move up the value chain. “Our vision is embedded in our business model. We invest heavily in building business processes that are aimed at long-term competitiveness and sustainability of the partnership with our customers,” he adds. PED sees India as a factory to the world, especially for products with higher levels of engineering content. It believes that there is a huge market in high value products for industries such as aerospace and medical technology.

“Many global players either have their own integration plants in India or at least some other form of presence to serve the growing Indian market and use these channels as a conduit for developing their supplier base here,” says Dwarakanath. He believes that this sets the benchmark for high quality standards, a point on which PED scores very high. Even the Indian manufacturers are adopting international standards and practices rapidly, thanks to the joint ventures and other partnerships, he says.

One globe, one market
For the PED, it is virtually one global marketplace at least for the contract-manufacturing scene. A survey jointly conducted with Tata Strategic Management Group, estimates the addressable market for precision parts worldwide at Rs1,35,000 crore and growing. Says Dwarakanath, “As we move up the value chain, this value could grow in geometric proportions.”

Set up with an investment of over $10 million, the division today has four main revenue streams: precision parts, dashboard instruments, electronic circuit boards and machine building and automation solutions. While precision components, dashboard instrument and sub systems cater to both domestic and international markets, automation solutions are mainly for the domestic market.

The automation solutions market for the PED is about Rs500 crore in India. The global market for light and medium size capital goods is very large and it is estimated that roughly 5 per cent of this falls in automation solutions category.

PED caters to the automotive and aerospace industries with dedicated facilities spread out over 3 lakh sq ft of shop floor space. Given the strategy PED has always had — the globe as one market — Dwarakanath reckons that it should be growing at a CAGR of more than 50 per cent over the next five years. This can be done through scaling up current operations and moving up the value chain.

The road to the future
PED is predominantly a build-to-print-contract manufacturer except in the case of instrumentation and automation solutions. Dwarakanath says, “In these two streams, we focus our R&D efforts on bringing out cost-effective solutions using proven technologies. For example, in the automotive instrumentation area, programme life cycles are constantly shrinking and therefore, the supply chain cannot afford huge costs for new or enhanced features unless it is leveraged in several platforms and for multiple purposes. So we use existing technological platforms to bring in totally new features.”

PED works closely with the customers to develop products that are best suited to their requirements. It is currently developing an analog automobile clock for Aston Martin that would change its time according to the local time zone based on GPS signals available in the car.

PED can handle a variety of metal types and has complete in-house tooling capabilities. There are over 100 machines for precision machining, stamping and moulding. “It has also earned several prestigious certifications,” says Dwarakanath. It has the ISO 9000 (Quality System Standard), ISO 14001 (Environment Management System Standard), TS 16949 (Automotive Quality System Standard) and the AS 9100 B (Aerospace Quality System Standard). PED was recently awarded the FORD Q1 — the most preferred supplier award by Ford Europe, in recognition of achieving zero PPM quality levels for over 24 months, 100 per cent on-time delivery and several other parameters on which a supplier is evaluated.

“We at Titan are proud that our main customers are top international companies like Ford UK and US, Visteon, TYCO USA, United Technologies, Dahaner Motion USA, among others. We also have prestigious clients in the country like Hindustan Aeronautics, Indian Space Research Organisation, Stanadyne, Visteon, Mico Bosch, Knorr Bremse, Honeywell Turbo Tech, Tata Motors, Emmerson Electric, etc,” adds Dwarakanath.

Titan PED is preparing to foray into high-value products and is in discussion with potential partners who can provide the technological base and open up new markets through buy-back arrangements, joint business development, etc. “The possibilities are immense and the potential is vast. We are keen to be the global provider for precision engineering and are working towards that,” signs off Dwarakanath, eager to conquer the next engineering global challenge.