Rane’s Godfather

CHENNAI: In the 1940s, way before it was the flavour of the season, being an entrepreneur was like being a seafarer. It took a certain kind of person to battle the odds and emerge victorious. It took a person like LL Narayan, affectionately called LLN, who made the bold decision of transforming what was purely a trading enterprise into the manufacturing entity that Rane Group is now.

A man who was much ahead of his time, LLN knew that low fixed costs and overheads were crucial to a successful enterprise. 2017 marks his birth centenary, which was observed at a small gathering in Chennai recently. “He developed an ‘asset-light’ business model and practised ‘frugal engineering’ much before they became watchwords for modern businesses,” said Laxman, his son and current chairman emeritus of the Rane Group.

French Parade in Madras

A botany graduate, one of LLN’S strengths was his attention to detail. As a salesman, he was a forerunner of flamboyance, much ahead of the start-up billionaires of this new millennium. In 1948, Rane was a trading company for automobiles and parts. When LLN took over a consignment of 300 Renault cars, the salesman in him realised the potential it held.

It was not to be a cargo transfer from the port to garage, but a statement, probably without much additional expense — he simply arranged for young men to drive those cars from the harbour, down Mount Road, through Pattulas Road like a parade. Even in an age devoid of mobile phones and social media, the news of the ‘French parade’ spread like wild fire, and the vehicles were sold from Cape Comorin to Hyderabad in a matter of a few days!

But that was LLN, the sales professional. As a person, he was simple, “like many of the visionaries of his time... He operated without a calendar and his doors were always open,” Laxman added.

Tight purse strings

LLN joined Rane in 1940, when the trading firm was run by TR Ganapathy Iyer. So impressed was Iyer by the skill and potential of the young man, he was keen to have Narayan as a son-in-law. Soon, LLN married Saraswathy, Iyer’s eldest daughter. When Iyer died in 1946, LLN took over Rane. His management style was different from Iyer’s, and though it was touted as flamboyant, LLN was very particular about keeping a close watch on the funds.

Soon, despite his success in the trading business, Narayan began dreaming big, of becoming the manufacturer of products that countless traders like him sold. But, the business atmosphere in the 1950’s was not the most conducive.

“In the 1950’s, the backdrop was that of the establishment of the permit raj and licences, where entrepreneurs were not encouraged but controlled, and all auto companies were restrained due to the exceedingly high taxation on passenger vehicles,” narrated Abhay Firodia, chairman of Force Motors, at the event. “The odds were against any entrepreneur. But we saw a few companies like Rane that successfully battled these obstacles to create a legacy that stands till today.”

LLN brought the doggedness and personal networking of a salesman to the new job. “He made the effort to visit plants regularly and went the extra mile to keep up business relationships,” recalled N Sankar, chairman, SANMAR group.

Head and Heart

During one of his interactions, Laxman recalled something he was told. He said while his father did business with his heart and head, the next generation did business only with their head. “That’s why he was able to generate immense goodwill with the other businesspersons of his time,” he pointed out. Sankar agreed, and added, “The moment he saw the plot of 15 acres on OMR, he thought it was completely unnecessary and told me I had wasted money.

But herein lay the greatness of the man: he called the next day and said that he had studied my project report and felt it held promise. He encouraged me a lot, but his views on unnecessary wastage in the project stage stuck with me. I always sought advice from him and could count on him because he would not sugarcoat his opinion.”