Rajneesh Rallan (M.98)
Confessions & Lubricants
Mumbai. Rajneesh welcomed us in his control office in Mumbai. This phlegmatic manufacturer, who played in Indian TV shows when he was in his 20s, told us very calmly about his entire career. Switching very easily from English to French, he talked passionately about France and HEC, feeling a bit touched at the end of the interview when remembering his BDE campaign.
Read full transcript…
HU: Let’s start with our Chinese portrait. So if you were a color…
HU: An animal?
R: An elephant.
HU: A meal?
R: Italian pasta with Indian spices.
HU: A song?
R: Champs-Élysées, by Joe Dassin.
HU: A movie?
HU: A sin?
HU: An object?
R: A car.
HU: A sport or a game?
HU: A book?
R: Book of Facts by Isaac Asimov.
HU: A (super)hero?
R: Superman, because he makes me really happy.
HU: Now, can you try to sum up your professional background in just 30 seconds?
R: I am an engineer by profession. I have worked in many industries like textile, petro-chemicals, technology, consulting. I have also been an actor in TV series and in 16 advertising films when I was your age. I am right now on my 5th manufacturing unit and I have two units today, one is in India and one is in Turkey!
“It’s a continuously evolving profession: we have new products every months and we do a lot of custom made lubricants too.”
HU: What is your company, Yale Industries doing?
R: We are a very old Indian company, which was started by my father 38 years ago. I joined the company 8 years ago when I took over the business from him. We are the oldest and largest synthetic lubricants and grease manufacturing company in India. Our products are among the best in the world, comparable to any European or American product.
Our Indian manufacturing unit is not that old, it’s about 9 years old and is growing organically at a 10-15% rate every year.
HU: What is your development strategy?
R: Since we are manufacturing such good products for Indian companies, we now want to offer our expertise to Europe so we have taken our business model and we have applied the same manufacturing and marketing techniques in Turkey, which is a market very similar to India in terms of demography and economy. The cultural similarities have also encouraged us to sell our products there.
As most of our raw materials are imported, we did this because it becomes difficult to manufacture in India and then export.
HU: Could you try to explain us what synthetic lubricants are?
R: In French it is called “les huiles de synthèse”, they are lubricants that are made with anything that is not crude oil. Synthetic lubricants can do things normal lubricants cannot do: when there is a very high or low temperature, a very high speed, a very high load, you require something that outperforms standard oil.
The need for those synthetic lubricants came with the industrial revolution and the aviation. Standard oil will freeze at a certain temperature in planes, or a machine will stop working after a certain speed. Because of those hard conditions brought by the industrial revolution, we were forced to discover new materials.
The future is bio-lubricants, made of green vegetable oil, which will be bio-degradable lubricants.
It’s a continuously evolving profession: we have new products every months and we do a lot of custom made lubricants too.
“Many of our clients are machine manufacturers who tell their clients to buy the lubricants from Yale, my company.”
HU: Who are your clients?
R: Any industry that has a heating oven, like a bakery industry making bread for example. Bread is baked at a certain temperature and if you use petroleum oil everything will burn, so you need a synthetic oil! Most of the bakery companies in India use our oil.
We also work with industries that use refrigeration, like ice cream companies. They use a compressor to press the ice and make the temperature below a certain level. The gas used in this compressor can go to -70°C, so that can only work with synthetic oil.
If a company manufactures a nuclear reactor, it will use a shield that is 50 cm thick and weighs 500 tons. The machine that makes that shield has to take the load so you need a grease that can work with such heavy loads.
These are products we developed for special industries, along with the machines. When you make a new machine, you need a product that will work for that machine, so either you buy a product from the market that works, or you contact someone like me to develop the appropriate lubricant or grease. As a result, many of our clients are machine manufacturers who tell their clients to buy the lubricants from Yale, my company.
HU: Have you coped with a difficult choice in your professional life?
R: Yes I have. I was living in France for many years, almost 8-9 years and I had the choice to either live on in France and keep doing what I was doing there or to come back to India. I had just started a company and I was barely making money. You know when you start a company it takes time to pick up. But things were going OK, I could live there and have a good life. I had a nice house in a nice place, a comfortable life, but it was not challenging enough.
I had no interest in coming back to India but an opportunity came. It was very simple: I could make as much money in a year in India as in 10 years in France. The opportunity was to take over my father’s business and to open up a new factory in India, in a green zone. To promote industrialization, the Indian government designated many green zones developed for industry and gives you many advantages if you settle a factory in these green zones, like a tax holiday for 5 years.
I took this opportunity to come back. It was a very difficult decision to make because I never knew if I would be able to live in India after so many years abroad. But surprisingly I was very happy to be back. I guess it was a natural progression and many of my colleagues from Paris also left France to live in the US or in Hong Kong. My adventure in Paris was over, I had a good opportunity and I took it. It was a difficult decision but a good choice.
HU: What is your typical day?
R: There are two types of day: the day when I am in my office and the day when I am not in my office. When I am not in office I am either in the factory or with a client. I have to visit factories, so I visit one factory after the other, I go with my Sales people and I help them out with the technical or commercial issues. The other typical working day will be coming to office. This office in Mumbai is our control centre for all India, where we prepare all the orders for the day. We have a daily ordering system for the factory. We do the Sales and the manufacturing organization here.
I don’t have a well defined-job: I do everything and I make sure everyone does its work.
HU: What will you be doing in the coming days?
R: Next weekend I am attending a conference of grease manufacturers. We will meet everybody from the industry, my suppliers, my competitors… It’s a formal networking event: you attend lectures, conferences. That will be for 3 days. The week after I travel to New Delhi, where my factory is settled.
“I have a 22-months old son, so wherever I can take my son these days is my favorite place. I can take him to the garden, I can take him to the club. Life changes when you have a child, so all you favorite places change.”
HU: But you live in Mumbai. For how long have you been living here?
R: I came back to India in 2007 and I have lived in Mumbai since then. My factory is in Delhi and for a long time I was living there but when I got married, in 2007, I decided to live here.
HU: What are your favorite places in Mumbai?
R: I went to a Jesuit school in Bandra, a neighbourhood from Mumbai. This is my favorite area, because I grew up there. It’s the French quarter of Mumbai and a lot of French people live in Bandra. But that is not why I like it. I like it because I grew up there.
Now if we talk about places, I am very lucky to live in Colaba. There are 7 beautiful gardens and I like to go there. I don’t go often enough because of the pollution in Mumbai. Mumbai is a very polluted city, but early in the morning if you go to the garden it’s really nice.
I also love to eat and I have many places where I like to go and eat.
I am also a member of a couple of clubs in this side of town. In India when you say club it doesn’t mean “sports club” or “night club”. In France you don’t have that concept. You go there, you can maybe play tennis, you can have a drink, a meal, go for a swim or something. You have to be a member and it’s not easy because there are many people and very few clubs in Mumbai. I am lucky enough to have club memberships in this side of town, which is not far from my home.
I have a 22-months old son, so wherever I can take my son these days is my favorite place. I can take him to the garden, I can take him to the club. Life changes when you have a child, so all you favorite places change. A few years back, my favorite place would have been some kind of restaurant or a nightclub, but not anymore! That was another life! Maybe when he is a little older I will start going back to nightclubs! (laughs)
“It’s easier for me to export my lubricants to any part of the world, including Pakistan, than to sell within India.”
HU: What do you like most about people from Mumbai?
R: Being multi-cultural is not the only thing about Mumbai. It is also a very proud city. Unfortunately we don’t have all the privileges of being the capital of India, Delhi is. Delhi gets all the infrastructure and beautiful roads… Whereas Mumbai is the one that pays all the taxes: 70% of the income tax of India comes from Mumbai!
All companies have their headquarters in Mumbai and people from Mumbai are proud to be from Mumbai. It’s not the case for the people from Delhi and I know that for a fact, because my parents are from Delhi. Even people who migrate to Mumbai will tell you that they are from Mumbai. This city absorbs you.
HU: What is India’s challenge that matter the most to you?
R: Something that has been in the news for a very long time: the GST bill, the Goods and Services tax Bill. It has to happen and it will really ease the flow of business in India.
Every State has a separate tax department and there are multiple taxes. Today, as a manufacturer, if I want to sell my goods in another state of India, I have to go through a lot of paperwork. I cannot just ship my goods to any part of India, we need to acquire certificates for each delivery so I have a person in the company just doing that all the time. When all the certificates are issued, the goods are dispatched but the payment is another big issue because your client must give you another certificate with the money!
All this is happening because of the different rates of taxation between the states of India. It’s a shame that in a big country like India, it’s easier for me to export my lubricants to any part of the world, including Pakistan, than to sell within India. And buying is the same because you have to go through the same process. This is madness, it’s a nightmare!
So this GST bill is the next big challenge for any business in India. It has to be passed. Did you know that less than 5% of the population pays income tax? There is a huge work to do on taxation.
HU: Are you optimistic?
R: Yes, things are changing. A few years ago, getting a passport would take you between 3 to 6 months. Today you get a passport online in 3 days. The government has done that and it’s a great example of technology helping the administration.
“I applied to HEC, INSEAD, London Business School and IMD Lausanne. I got into the 4 schools. IMD Lausanne was too expensive but I visited the three other schools and I immediately felt a connection with HEC. I thought to myself: “This is the place for me.”
HU: Let’s talk about HEC now. When did you start your MBA?
R: I started my MBA in September 1998 and I finished in December 1999.
HU: Why did you want to do an MBA?
R: I started working at a very young age. I was 19, in second year of engineering school and my father wanted me to work in his company. At the time I thought: “Ok, I do this now and later I will go and study abroad.” That is the reason why I did an MBA later on.
HU: Why did you choose HEC?
R: France attracted me because I spoke French. I had French in school and it was my favorite subject so I was always already keen to go to France. But I didn’t know about French business schools at the time.
In 1996 I made a little research when I was considering applying to an MBA. For most Indians, you have to do an MBA in the US. But during this research process, I travelled to Europe and I felt that I was emotionally closer to Europe. France was my first choice, even if I had never been there. The first time I went to France was actually for my HEC interview!
I applied to HEC, INSEAD, London Business School and IMD Lausanne. I got into the 4 schools. IMD Lausanne was too expensive but I visited the three other schools and I immediately felt a connection with HEC. I thought to myself: “This is the place for me.”
R: Because I was comfortable! It was me! I met the students there and I couldn’t see myself go to another place. It was an emotional connection. In life, when you make a decision, you need to feel happy. I saw myself being happy and fulfilled after doing an MBA at HEC. I felt a good vibe at HEC, I liked the students, the teachers, the campus… It seemed more like an educational institute than INSEAD and LBS, which seemed to be more interested in my fees than in my education.
I think it was the best decision I took in my life. The year and a half I spent on campus is probably the best memory of my life… till the birth of my son of course!
“The best memories are the ski trips I did with my friends. We went skiing together many times during my MBA, 5 times in 18 months. I learnt how to ski, which was a huge personal achievement for me, an Indian!”
HU: Why did you like HEC so much?
R: It was very particular due to 2 reasons:
- It’s more transformational than any other MBA, because it’s a smaller MBA, with fewer students, but at the same time it’s a longer MBA.
- These students are more diverse. In most MBAs, you will find the same kind of profiles whereas in HEC there is a lot of diversity in terms of nationality and career paths.
I never thought I could do what I am doing today; HEC gave me the courage and the skills to do it. Personally, I got the chance to get an immersion in a different culture and a different work environment, which enabled me to work in France after my MBA.
Many of my friends who did MBAs in INSEAD or LBS came back directly to India. In HEC, the most “Franco-French” school of all, the most respected and known in France, so I could meet people from France, make contacts and prepare my life in France. I wouldn’t have been able to live in France for such a long time if I didn’t go to HEC, for sure.
HU: What was your favourite place on the campus?
R: The Zinc. I liked the Zinc because it was the perfect place to have fun. When you are in a MBA, working hard in a very professional environment, you need to learn to have fun as well. That is one thing I learnt at HEC and it was an important part of the “campus education”.
HU: What is your best memory from your MBA at HEC?
R: The best memories are the ski trips I did with my friends. We went skiing together many times during my MBA, 5 times in 18 months. I learnt how to ski, which was a huge personal achievement for me, an Indian!
HU: You did these ski trips with your friends from HEC?
R: Yes, with French friends. I had never been on skis. In December 1998, a friend of mine from Valencia was going home for Christmas. I was alone on campus and it was only a few months after the beginning of the MBA so I didn’t want to go back to India. He invited me and a couple of other participants to his home. We drove from Jouy-en-Josas to Valencia, and then from Valencia we went to Andorra for ski vacation. On my very first day, he took me right away to a black slope: it was the first time I was wearing skis in my life and he just left me on a black slope! Of course I couldn’t do it, I was too hard and I had to climb down the whole mountain! (laughs)
But by the time I did my 5th ski trip, I was able to ski on blue slopes. I am still not very good but at least I can ski a little.
HU: Are you sure this was a good friend?
R: He was a mad guy (laughs). He lives in Spain now, where he owns a company specialized in crowdfunding for real estate. If you go there you can ask him about the ski slope story!
“You know when I went to HEC I already knew a lot of things. I had certainty about the way to run a business, so it was not easy to break them by learning something new.”
HU: Apart from skiing, what did the HEC MBA enable you to do?
R: It allowed me to stay in France, which was my goal. And everything that I did in France helps me today. Today I am running a company and taking it international because I have a much better understanding of how business works internationally.
HU: Would you advise someone to do the HEC MBA today? Why?
R: Yes of course, it is the best choice you can make! Now it is much higher in the rankings than it used to. Today HEC is the 1st business school il Europe and the MBA is ranked no. 1 or no. 2 each year, so everybody now wants to go to HEC! If I had to choose again today I would do the same!
HU: HEC’s motto is “The more you now the more you dare”. What’s yours?
R: If I say “Oser apprendre” will you hold it against me?
HU: No, of course not, but please explain!
R: We had created a BDE team that was called “Oser Apprendre” and it means something, really! You know when I went to HEC I already knew a lot of things. I had certainty about the way to run a business, so it was not easy to break them by learning something new. I had done marketing before, naturally, by working in a very old-school brick and mortal company, but business models change and I needed to understand their new financial and emotional aspects.
I am now prepared to anything, even to sell my business, because I learnt valuation at HEC. And that is just one example. Another one is that I can now better understand the emotional motivation and the thinking process of my business partners, whatever their background is.
HU: But you didn’t tell us about the BDE story…
R: This is a fantastic story and lot of my HEC friends will appreciate it. When the MBA started we were all friends. The 100 participants were all happy to be there and to be part of this diversity. But the elections for the BDE came and two camps were formed… Things became ugly: each camp criticized the other one via emails and it became very political. I didn’t like it, because we were all here to study and the BDE was something to have fun, right?
I came up with the name “Oser Apprendre” and we created, with some friends, a third camp and we got a third of the campaign budget given by the former BDE, like the two other teams. That’s how it works for the MBA BDE campaign: the BDE gives money for the campaign and the elected list gets the rest for its mandate.
But anyway, we got some money and we decided to lighten the mood and show these guys it was all about having fun. We said: “Please don’t vote for us”, we didn’t want to compete. But we used all the money to organize a party: we bought wigs and pizza for everybody and we did a great party like that. It was super fun and it lightened the mood!
HU: What happened in the end?
R: One of the others team won, we didn’t get a single vote. We just played the fool to remind everybody that it was just a BDE election. That’s my it is my motto, it reminds me of this great memory.
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