Reinventing Khadi

Rajendra Pratap Gupta
Member (Marketing), Khadi & Village Industries Commission

IT was a chance meeting with the Prime Minister in December 2015, wherein we talked about how the Khadi & Village Industries Commission (KVIC) could transform rural India and contribute to boosting the rural economy and creating both entrepreneurs and jobs. Immediately, my meeting was fixed with the KVIC team, wherein I shared my thoughts on transforming the KVIC, which included suggestions like introducing designer wear, franchising of Khadi stores, starting shop-in-shops, increasing our bouquet of offerings like organic products and opening stores at airports and train stations to create jobs and reposition khadi. Post the meeting, I forgot about it, till I was asked by the PMO in February 2016 to send a brief report on the meeting. 

The Ministry of MSME had, by then, sent me an official letter that the suggestions are well taken and transmitted to outlets for implementation. In December 2016, I got a call for being appointed as a member of the commission. Then came the moment of truth. Khadi was undergoing a churn due to the push from the Prime Minister, and the KVIC was living (and is still living) on the support it has directly received from the PM (calling the people to use khadi, which has boosted the sales beyond imagination). 

We have tied up with a leading brand to sell Khadi wear and even opened our stores at a few airports, re-branded stores to 'Khadi Lounge', started designer Khadi wear; we are starting the Khadi Ambassador/ khadi Mitra scheme (earn while you learn scheme), a 'National Khadi Week', and franchising Khadi stores. 

Realising that despite all these changes, the sales staff needed a direct financial incentive to become customer centric, on October 2, we introduced an incentive scheme for the staff. These efforts are showing results. We have started getting orders which were never imaginable in the past but we still have an internal issue of catering to such supplies. Khadi is in need of the next level of structural reforms. In the last quarter, an exercise has been initiated of creating a plan for the vision for KVIC to take it to the next level.

We will have to restructure the senior management by re-orienting the roles. The idea is to transform the roles from 'administration' of 'geographies', ie zones/regions' (like regional/zonal directors/deputy CEO) to 'management of product categories' as 'category heads', ie director/deputy CEO of product categories like readymade (men's/women's/kids' wear), Khadi fabrics, haircare, skincare, food, organic products and other consumables. 

This will shift the focus from 'administration' to 'sales', and also, the thrust is to create decent profit for the rural weavers and artisans and expanding their base so that we could cater to the ever-increasing demand for our products. This calls for a complete overhaul of the KVIC institution. The ministers have been supporting drastic changes, but the organisation down the line needs a 'push' and 'shock therapy' to wake up. In my first two months, I realised that we spent more time on handling vigilance/corruption cases at the monthly commission meetings and barely got time for any progressive agenda. I had to bring this at the commission meeting that we need to spend more time on issues related to growth and adoption of khadi.  

After that, we have taken transformative steps for administrative reforms in line with the Prime Minister's 'good governance' and 'ease of doing business'. They entail:

1No vendor should come to office for payment and all payments be cleared within 45 days of sale of their products. If the payment is not cleared, the approving authority pays 5% interest from his/her pocket. This will curb the corruption on making money from vendors. 

2The movement of files is limited to three levels and each level needs to take action within seven days (unless requiring SFC/Commission approval). This will cut the delays on file movement. 

3The commission officials have been advised to use 'common sense' more than the 'committees'. The KVIC was known for committees which lead to inordinate delays. This change gives the senior officials the authority to act swiftly and independently and also, the commission can fix the individual accountability for wrong decision and delays. 

4Another important change has been to cut down the external influence on decisions. If any employee is reported to be using external pressure for transfer, posting, and leniency, then the same is to be reported to the CEO/CVO and a strict action is to be taken. This has cut down the political influence and canvassing so that the commission can take harsh decision without any pressure.

All this has been possible due to very upright members on the board. The challenge lies in getting these decisions implemented swiftly. If we are able to push these reforms, Khadi can become the Walmart of India, largest creator of jobs in rural India after agriculture, uplift the rural economy, and create a brand worth a lakh crore in five years, with our brand strength driven by the personal support from the PM.