It wasn’t the meeting that Sonali Kulkarni, President and CEO of Fanuc India, often called the ‘Robot Queen’, was expecting. On the hot summer afternoon of June 16, 2011, Kulkarni, who is also the great-granddaughter of Mahatma Gandhi, was in Delhi, meeting customers. Her third meeting that day was at Hero MotoCorp’s Gurugram plant. Hero, the world’s largest two-wheeler manufacturer, uses Fanuc’s industrial robots and computerised numerical controls (CNC). Three cars pulled up on the porch of the factory; Kulkarni was standing on the steps. Brijmohan Lall Munjal, the late patriarch of the Munjal family that owns Hero MotoCorp, stepped out of one of the cars.
The then 87-year-old Munjal was visiting Hero’s factories, doing havan on the death anniversary of Raman Kant Munjal—his son and the late brother of Pawan Kant Munjal, chairman, CEO and MD of Hero MotoCorp. “He need not have greeted us; we were selling just a few machines to Hero,” Kulkarni says. “But he stopped, held the hand of each person, looked into their eyes and spoke to each one of them.”
Kulkarni was touched by Munjal’s gesture. She still is and it is visible. She pauses for a couple of seconds on the Zoom call and speaks again: “I was touched, not because he was a famous man but because he was a humane man.”
It is a paradox, one would say! Kulkarni, who sells robots that are often seen as the alternative to humans in factories, talks about human emotions. In just six of Hero’s plants, 1,605 of Fanuc’s Robodrills, CNCs and robots (all automated machines) are installed. “(In Hero’s factories) We have an overall share of 86%. In machines, we have 94%,” she says.
By the end of September, Fanuc India’s installed base will cross 240,000 units. In 2014, that number was around 100,000 across a similar number of customers. Its market share of a dominant 77% is envious. But, Kulkarni doesn’t want to get into a market share discussion. “Growth has always been measured by the success of our customers. This could be described as the growth of Indian manufacturing in not just volume but in quality – on a global scale,” she says.
The Japanese automation and robotics company’s India subsidiary has a huge domestic opportunity. According to India Brand Equity Foundation (IBEF), the manufacturing sector’s gross value added (GVA) is estimated at $348.53 billion as per the second advance estimates of FY21, and it accounts for 19% of the country’s real GVA. And, it has the potential to reach $1 trillion by 2025.
But, for Kulkarni, the conversation is more around growth in the post-pandemic era. “The CNC market is up 100% as compared to the pre-pandemic world,” she says. So, what’s causing the growth?
India’s Post-Pandemic Growth Story
Fanuc India shut its operations a week before Prime Minister Narendra Modi called for a nationwide lockdown. For Kulkarni, it was not a difficult decision to make. “As a person it was easy. International newspapers carried photos of rows of coffins… on their front page,” she says.
In May, Fanuc reopened. After all, manufacturing cannot be “shut down” so easily. Initially, it was difficult with everything becoming digital. “As a culture it is not acceptable. It is considered a little weak. We spend a lot of time connecting/ understanding meet a lot of customers at their place of work, walk the shopfloors,” Kulkarni adds.
But, the pandemic opened new opportunities for Indian manufacturers. As factories shut down, labourers – mostly from villages – went back to their homes. The human crisis was leading companies to replace them with machines. But, this isn’t new. “Manufacturers have always struggled with managing labour – and the complications around retention, scaling of operations etc,” says Kulkarni. The pandemic has only exacerbated the situation. “The truth is people were not happy to have labour. We don’t treat labour well. The poor labourers went home but so would you, if you lived in some hutment. In that crunch time, a lot of people were looking for robots and they still are. That is called jobless growth,” says Kulkarni.
“The pandemic has reconfigured demand flows,” says Kulkarni. There is a global surge in machine tools and robot demand; a blessing in disguise, as hitherto imported models of higher end machines – are now unavailable. “This has created an opportunity for Indian MTB – especially for high-tech, high-end Machine models.”
Top that with the US-China friction, the pandemic induced urgency of companies to look for alternate manufacturing locations outside the Asian country and travel restrictions; there is a rise in the requirement for domestic vendors. “Instead of a Chinese vendor, where you need a Chinese team to come and set up a machine, they are looking at Indian machine tool vendors,” explains Kulkarni.
But Kulkarni cautions: “Let us not fool ourselves that India has become the next manufacturing destination. We are still as insignificant as we were, in sheer numbers, 10 years ago compared to China,” she says. But, in the same breath, Kulkarni continues: “Indian component makers are meriting greater export orders than they did in the past for more sophisticated machines. All of this requires investment in new kinds of machines and new controllers.”
What does it mean for the evolution of manufacturing in India in the next decade? What about the jobs? As Kulkarni tries to answer some of these questions, she loves to keep humans at the centre of the change.
Who And What Will The Robots Replace?
With the rise of the Internet of Things (IoT) coupled with artificial intelligence (AI) and machine learning, most factory owners have started discussing newer technologies (see table Future of Manufacturing). “It will be AI-supported but select human beings will always matter,” says Kulkarni, but adds, “We have already been on the path of jobless growth for many years. In the next 10 years, there will be further jobless growth.” But the rise of the machines is also because of unavailability of highly skilled people and need to scale faster. “Not just robots, CNC machines also can be pointed at for reducing employment. But, India could not have reached even this stage of self-reliance in any manufacturing space (be it syringes, auto components, general engineering, aerospace whatever) if we had not embraced CNC machines,” says Kulkarni
So, What Is A Robot Replacing?
Pat comes her reply. “A human being standing in front of a machine for 8 hours - you start and stop the machine, unload machined component, load a new job – visually inspect – etc. As the machines are getting smarter, the skill content in a machine operator’s job is shrinking. This is hardly the life one would wish for any person.” Repetitive jobs are the ones to get automated first – like assembling a car. “Automotive is the most robotised. Even the Tier-II vendors of automotive that were not robotised until three-four years ago, have begun the journey,” she says. Others who are robotising are the plastic processing industry, fast-moving consumer goods, retail and e-tail, and pharma.
Kulkarni is seeing automation trickling down to smaller manufacturers. “There is a large variation – but on the whole we can surely say – Tier-II and III are about 15% robotised. If one views sheet metal applications like welding – these lend themselves much more and are about 25% robotised,” she says.
Built With The Right Intention
In a nutshell, the factory of the future can’t be built without the right vision. “You cannot robotise a factory effectively if your only aim is to replace labour,” says Kulkarni, without beating around the bush. “You should robotise if you want to scale up production or if you want to scale up repeatability—whether it is in the first hour of the shift or in the 59th minute of the last hour of the shift, the performance is the same.”
She goes back to explain that if the intention of bringing in technology is to keep an eye on people—for instance, how many breaks a labourer takes or how he runs the machine—modernisation will never happen. “This is a dividing view rather than a multiplying view. One needs time to think, “What will I do with the data? How will I bring it to use?’ There is no ready-made solution for it,” Kulkarni says. One of the key things in IoT is to think about what the desired outcome is and what the possibilities are with data. “All this needs a grand vision,” says Kulkarni. After all, in the end, all machines, including the CNC, collect a lot of data, and if that data is fetched from the shop floor and processed at the edge, where all the devices in the factories are, the possibilities can be immense.
Future Of A Factory: The Man-Machine Interface
The popular vision of a totally robotised, autonomous plant, would be straight out of mid-century sci-fi novels. “Actually, it is a fact on the ground – if you consider FANUC factories in Japan,” says Kulkarni. “In early 2000s we crossed 720 hours of unmanned production, which translates to one month.”
But there is the dichotomy of factories dense with workers churning out the most sophisticated tech products. Think smart phones. “The future may pivot on two obvious drivers – scarcity of labour and high real estate cost. This leads to demand for compact machines, multi-tasking machines, and effective utilisation of machines,” says Kulkarni. And, in the whole scheme of things industrial IoT becomes part of effective utilisation of not just the machines but all resources on the shop floor.
But, a connected factory would need better design thinking. “Factory layout must be thought of in a way with everything that is available today,” says Kulkarni. “I feel that there is no magic in this. People just need to get into the weeds, be in the details and do a fine job. What we get caught up in is this sexy thing of glamourous ideas and the 23rd century and all that but we are not even exiting the 20th century properly. Not to be grey, India is doing well.”
Kulkarni’s conversations with manufacturers are gradually changing. “They are not so cautious anymore. Investments are done boldly on new machinery, hiring and training,” she says.
The biggest reason for the shift is the lack of manpower availability, which has become a hurdle to scale. “Conscious factories are increasing great tracts of robotisation or bringing in sophisticated machines which are artificially intelligent,” she adds.
The world, Kulkarni says, in many ways is shrinking, and increasing opportunities for India. Machine builders, automakers, auto component makers, and pharma are doing great.
It’s almost 8:30 pm on a Sunday evening, an hour longer than the 45 minutes that Kulkarni had promised for the interview. She has already missed her evening walk with her husband, Ravi Venkatesan, former chairman of Microsoft India and Bank of Baroda. “Let’s finish this (conversation),” she says, but that didn’t happen without her bringing back the people side of the manufacturing story.
“In the coming 10 years, we will see fast changes and good changes. The only thing that we, as a country, will have to look for is how we will attend to our population because manufacturing is what is supposed to generate employment in massive numbers,” says Kulkarni.
But, if jobless growth continues, there will be a tremendous problem. “Do we lament that the robot took away their job, or do we invest in them to address higher level work – very much in keeping with their abilities. I strongly believe we have a great case for the latter,” emphasises Kulkarni, ending the conversation.
Sunny Sen is the co-founder and CEO of ConsCent, a payments and analytics company building the future of content monetisation. Before ConsCent, he was a business journalist with Network18, The Economic Times, Hindustan Times, among others.