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The Smart Techie was renamed Siliconindia India Edition starting Feb 2012 to continue the nearly two decade track record of excellence of our US edition.

Emerging Markets Offer Huge Growth Potential for Enterprises

Vimali Swamy
Wednesday, April 4, 2012
Vimali Swamy
Dinesh C Paliwal, Chairman, President & CEO, Harman International exerts the need among leaders to aggressively focus and cash in on emerging markets

Dinesh C. Paliwal is the Chairman, President & CEO of Harman International Industries, Inc (NYSE:HAR). Paliwal joined the company as President and CEO on July 1, 2007, and was further appointed Chairman on July 1, 2008. He instituted major change initiatives at HARMAN to simplify and strengthen the company’s operations. These include the formation of a diverse and multi?cultural board, recruitment of a seasoned executive management team, expansion of the company’s footprint and revenue in the emerging markets, propelling HARMAN’s innovation pipeline dramatically. To put the company on a profitable growth trajectory, he transformed the company culture and launched best in class business processes which delivered an unprecedented $450 million in sustained cost savings.
Prior to joining Harman, he spent 22 years with ABB Group (NYSE:ABB, a $40 billion global industrial leader), where he last held the dual role of President of ABB Group with responsibility for the company’s global P&L, and Chairman/CEO - ABB North America. He drove profitable growth by eliminating the cultural and organizational silos among multiple P&L operations globally and turned the multi-billion North American operation profitable following 18 years of losses.
He has a Masters degree in Engineering from the Indian Institute of Technology (IIT Roorkee), a Masters degree in Applied Science and Engineering (1983) and Business Administration (1985), both from Miami University (Ohio).


The main challenges and priorities faced by CEOs around the globe is hiring the topnotch talent and retaining them. People are the most important component of every successful company and much effort has to be put in this. Also the CEOs are finding difficulty with maintaining the necessary innovation required to develop new technology based products and solutions. Simultaneously, they will have to maintain a healthy balance sheet. Talent acquisition and development (most globally experienced team in our industry), R&D pipeline and production innovation (4,200 patents and pursuing hundreds more), and rapid growth in emerging markets are my primary concern now.

We have tremendous untapped opportunity in India and other emerging markets, where economic growth is far outpacing mature countries. When I arrived at Harman in 2007, I was shocked at the limited amount of business we were doing in these countries; we had hardly any presence outside the OECD countries. Diversity in our geographic reach became an immediate priority for me.

In just a few short years, we have been able to make some significant progress. In India, we established an Innovation Center and global Engineering center, and have booked more than $250 million worth of orders in last three months. We will soon announce second phase of investment in India which will include manufacturing and testing facility. We have acquired a company in Brazil called Selenium, which is accelerating our growth plans in the central and South American markets. Harman recently established a corporate office in Russia. But our major growth is coming out of China, where our revenues last year alone grew at 200 percent. We have operations in several cities across China, including R&D, engineering, manufacturing. We have opened a flagship retail store, and have announced automotive contracts with several Chinese automakers. We are making great strides, but we still have many opportunities to capture.

People are getting more and more connected

Three main trends are shaping the future of Harman’s approach to audio technology and design in the coming decade.

a. Cloud -
First, I think there will be an increasing shift away from local, storage-based media toward “cloud” – relying on the power of the Internet to access contents and services on demand. The power of this technology means that consumers will be able to access all their personal and public contents as services including their music or video libraries from wherever they are.

b. Connected Lifestyle –
People have come to expect an eco system which gives them totally connected lifestyle be it home, office or on the go. As a company that spans the home, automotive, and professional audio spectrum, Harman is in an advantageous position to leverage cloud based services across our markets and deliver a connected lifestyle experience that both broadens and simplifies how people access and enjoy digital media.

c. Digital Signal Processing -
The second developing trend we see is the requirement for an improvement to the digital quality of audio and video signals. We helped pioneer modern digital signal processing with technologies such as our Logic 7, Signal Doctor and Quantum Logic software which converts conventional stereo recordings into seven-channel streams. We are now working on an extension of this, code-named Signal Doctor, which will analyze and enhance compressed audio files such as mp3 format to "unlock" the true fidelity of the original recording. This approach will restore the audio quality that is now being denied to an entire generation of listeners.

Finally, we will see dramatic improvements in the sophistication of in-car audio and infotainment systems. We are working on a number of technology developments in this area, including many connectivity solutions such as text-to-speech capabilities, next generation Bluetooth, Ethernet audio/video bridging capabilities, and driver assist features to improve safety.



Risk management is something that our Board actively looks at. Last December, HARMAN launched its first ever Sustainability Report outlining an integrated set of actions and measurements that will empower HARMAN to endure. In the area of energy usage alone, our tracking methodologies are showing that we are becoming more efficient. During that time, energy assessments and several energy-reduction projects were completed at manufacturing sites in Germany and work on a global energy strategy is underway.

Some have suggested that the principles of sustainability have been overtaken by the survival instincts of companies enduring this prolonged economic storm. I think the opposite is true. It is those companies that embedded sustainability principles into their business decision-making processes that have allowed them to endure and prosper in these tougher economic times. We were one of those companies. We invested in innovation when everyone else said they could not. We expanded our footprint to get closer to our customers while others simply considered it. We took decisive actions while others ran for cover. It was not easy but it was necessary. And we continue to pursue energy reduction initiatives because we know it will pay dividends.

Leadership Mantra

My global exposure has taught me the importance of work cultures, ethics, discipline, a sense of purpose, and focus on deliverables. Whether it is food, music, or cultural values, I have a deep appreciation for global diversity, and I look for that quality as well in all my senior team. As for my business philosophy, there really is no substitute for courage, passion, hard work and calculated risk taking – these are the keys to delivering results. I believe in people, their strength of conviction and ideas. It has been proven to me time and again if you can light the passion within talented individuals, their potential is unlimited.

(As told to Vimali Swamy)


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