President and Managing Director
NISSAN PHILIPPINES, INC.
By Bernie Cahiles-Magkilat
Ramesh Narasimhan is leading the Philippines fastest growing car company. Bucking the odds, he maneuvered Nissan Philippines Inc. (NPI) into a turnaround story in just three years.
Not the kind to claim credit for the company’s success, Ramesh attributed its performance to the company’s culture where Filipinos work in an environment that fosters passion, empowerment and transparency. Ramesh invests in trust. He trusts his people to do the right thing and protects them even if they fail.
Nissan Philippines or NPI was founded on September 23, 2013. It is a joint venture formed by Nissan Motor Co., Ltd. (Nissan) and longtime partners Universal Motors Corporation (UMC) and Yulon Philippines Investment Co. Ltd. Nissan holds 51 percent stake in the company while UMC and Yulon each owns 24.5 percent of the outstanding and issued shares.
Ramesh came into the life of Nissan Philippines during its formative years in 2016. At that time, NPI was doing 12,000 units only in terms of sales. In other words, it was not at its best. It was still at the stage of fixing all the processes, strengthening the dealer network and putting the brand at its core focus.
Then the TRAIN Law, which slapped higher excise tax on motor vehicles, was implemented last year. To the overall industry, it was a period of uncertainty. Indeed, the new tax imposition caused the industry to plunge to its lowest in almost a decade.
But the law exempted pick-up trucks from the higher excise tax. This catapulted Nissan Navara’s sales to unprecedented growth.
“The TRAIN Law changed the segment quite a bit,” admits Ramesh.
Then they launched the Terra, which proved to be the most anticipated vehicle when the overall medium SUV segment had dropped by 40 percent. To support Terra, Nissan went into a teaser campaign three months prior to launch to build the anticipation that they had 2,000 vehicles booked before launch. Nissan cornered 15 percent market share, which was not bad considering stiff competition from the established brands. The rest is history.
Ramesh often talks of the Filipino workers at Nissan Philippines in awe.
“I think the talent that’s available in the Philippines is fantastic. They’re very passionate and they all want to succeed and that makes my job easier. I just need to share my vision and they’re a willing party in terms of wanting to participate in the growth and there’s lots of passion at least in Nissan, wanting to do the right thing and wanting Nissan to succeed,” says Ramesh.
That positive energy and mindset rubs off, making Nissan dealers energized and confident.
“The work environment is one key to success,” he adds.
He is no HR expert, no HR background, but Ramesh showed his expertise that right people management can make a difference to an organization.
“My reason is really simple. Products and services that you offer can be easily copied to a certain extent, but what you cannot easily emulate is the culture. So, I am always talking of the culture of the people and to me that is the one strength that we have that I am really proud of and that is the biggest differentiator for Nissan Philippines,” says Ramesh.
What happened when people are very passionate and very confident is that when they talk with dealers, it comes out with lots of passion. That passion becomes contagious that dealers do everything with even more passion. Eventually, that translates to sales.
There is no way though to measure the contribution of the Nissan Philippines’ culture in the overall revival and success of its brand here. “It is intangible, but the beauty of it is it cannot be copied easily,” he says.
“That is why I really love it although it takes a lot of time and effort,” says Ramesh, who used to serve as CFO for Nissan Melbourne, Australia and New Zealand before becoming NPI CEO.
Its competitive culture and program have resulted in the company’s vibrant market presence.
The big break they got was from the enactment of the TRAIN Law was also of great help as it changed the market preference benefitting the pick-up segment.
NPI saw its sales soaring amid a decline in the entire industry. The Japanese automaker grew about 40 percent last year after selling 34,952 units, giving the company an 8.7 percent market share.
Nissan Navara was the main driver for the company’s growth, as the popular pick-up truck contributed 46.2 percent of the sales in the Philippines. The new Nissan Terra also drove sales for the company, as the much-awaited M-SUV already contributed 11.9 percent of sales locally after its launch last May. Other models performed well, notably the Nissan Urvan and Almera contributing to 19.5 percent and 17.5 percent, respectively.
Thus, the focus of NPI now is how to sustain its growth and its competitive advantage.
“For now, really, Nissan’s focus is how to sustain this growth and how to maintain the competitive advantage that I have always spoken about in terms of culture. That is our focus and also product expansion and products that are relevant for the Philippines and what our customers are looking for. What sustains our growth is more important because we cannot just grow and fall back that is not very healthy, we have to be sustainable,” he says.
Ramesh is confident that its growth is sustainable. What they have put in place just needs constant investment. NPI has regained its third slot, after losing it for quite some time, among several market players. There is no place for complacency.
But gunning for growth does not really mean running after industry ranking among competitors. Instead, he calls for nimbleness in the market, taking care of people and making its dealer relationship stronger. NPI is investing and will continue invested in all these things to keep going.
In terms of products, NPI is looking at the size of the segments. So far, their line-up still misses a few segments, like the MPV model. They also need an entry level car model. These are opportunities they may need to look into and see if what makes sense for the Philippine market.
Nissan has already announced the introduction of LEAF in the Philippines in 2020. The LEAF, the first mass-market, pure-electric vehicle launched globally, is now the best-selling EV in history.
When asked about Nissan headquarters’ say of NPI’s sterling performance, Ramesh said in jest, “Well done! Can you grow more? You have extra task!” Already, Nissan has announced the appointment of Ramesh as the new president of Nissan Thailand, a promotion for a job well done.
But the Nissan Philippines’ journey has been an eye opener for Nissan’s big bosses in terms of the potential of the local unit amid a growing domestic economy. He believes the upcoming election would help the automotive industry recover by around 10 percent this year, as well as the government’s various infrastructure projects to drive the economy stronger.
“Nissan is pretty excited and committed to the Philippines,” says Ramesh citing the company’s decision to strengthen the local organization five years ago.
The successful journey of Nissan Philippines has only validated the company’s faith in the country and the market.
“We’re just happy that the confidence they invested in the market has proven to be right,” says Ramesh.
To push for its products, the company is planning to further expand its existing 42 dealership network. It is not a race though, the opening of new outlets will depend on the opportunity and the need to provide access and value to customers.
Ramesh also noted they are introducing the Nissan Intelligent Mobility, which is a real differentiator because it is all about driving experience.
“This is something that makes driving more comfortable, safer and more into enjoying the drive than worrying about the traffic,” says Ramesh.
A person with a very positive mindset, Ramesh was never daunted by the poor sales level of Nissan Philippines when he took its reigns.
“I was not really daunted, I was just excited. My view was, ‘So we’re only selling 12,000 units, we can grow more’,” recalls Ramesh.
Aside from running a good business, he got a bonus as Ramesh declares, “I absolutely love Philippines.”
“This weather can be a little warm in summer but so is Australia at 45 degrees so for me sunshine throughout the year, I will take it any day,” says Ramesh, who has been to most of the country’s fantastic beaches, except Boracay.
According to Ramesh, when the Philippine post was offered to him three years ago, he did not know what to expect. But when he flew in for the very first time, two months before moving over in 2016, Ramesh was just totally mesmerized by what he saw.
“To be honest, I did not know what to expect of the Philippines, but when I came two months before, I was blown by the Bonifacio Global City where NPI holds office. You don’t expect a place like this and I was absolutely truly excited of what I saw,” says Ramesh, an Indian who has been living in Australia for 15 years already.
“I had no idea about the Philippines and the Filipinos. But in just two days that I was here first, I already knew how warm and welcoming they are that I just called my boss and said ‘yes am pretty excited and am taking up the job’.”
From the language perspective, it was easy. The only challenge was he is a vegetarian. There are already restaurants in the metropolis offering vegetarian food, but it’s harder in the provinces. Other than that, he calls this country beautiful.
Ramesh has been grateful for Nissan for taking the risk for him, a finance person in Nissan but was given the chance to be in charge of a market.
“I love working for Nissan,” says Ramesh as he thanked Nissan for supporting him and giving him freedom to run NPI. “I absolutely love Nissan.” Given the choice, he would like Nissan to be his last company, but that could be beyond his control.
Ramesh has been in the automotive industry working with big brands, including Ford, for most of his life. This job has brought him to several countries including Australia, New Zealand, China, UK, Philippines, and soon Thailand.
It has been a satisfying journey as he described how fortunate the people who are working in this industry.
“I used to work for a very big global metal manufacturing company so every day when you work in the manufacturing plant you saw big pieces of metal but, you don’t stand there and admire. You don’t stop and look, you just walk past it.
But in car manufacturing, every time you look at a car you will have an opinion, there is passion towards the end product. You can connect whether you like it or hate it does not matter. We are spoiled that way because the end product, we talk about it with friends, we use it and family use it so you constantly think about it because it is something we always have an opinion about. And to be working in an industry like this we are absolutely fortunate,” he adds.
“If you have a passion for the end product, your job is fun, but when you cannot connect with your end product then the feeling could be different.”
His finance background may have helped him fulfill his mandate, but to Ramesh what is important is to have a well-rounded knowledge. At times, he would even think that his finance background could pose a challenge because he has a different mindset, but he realized that he should not always be thinking from a number’s perspective.
Ramesh is a flexible manager and is guided by three principles – trust, transparency, and empowerment.
“I absolutely trust my people and I would like them to trust me and trust is a big word because I trust they would do their job and they trust me to protect them even if they fail in something,” says Ramesh.
Transparency is critical, especially if there is a problem. Sometimes, transparency fails when there is a problem because people tend to cover that up until it would be too late to fix it.
Empowerment is one thing he has learned to be an important elixir of life. He allows his people to do their thing because he trusts them fully that they are going to do their job and do it right. At the same time, they have his back.
“I am hands-on but I don’t stand over their shoulder, that is not effective leadership,” says Ramesh, who plays badminton. He encourages his people to learn and treat every failure as learning moment and turn that into success. He would like his people to take risks for greater payback.
The busy CEO also takes a few days off to spend quality time with his wife and two kids. He still goes home every year to India to visit his mother. “On those days, I get spoiled because no matter how old you are, you are still a kid to your mom.”
Despite the competitive environment and pressures, Ramesh has kept kindness as a virtue or just simply being nice.
“The biggest thing for me is being nice, be kind,” says Ramesh noting that kindness could help you see things through.
At the end of the day, it is not all about business but kindness in everything you do and the rest will just fall into place.
Take that from the man behind Nissan Philippines success story.