Zen Technologies is a shining example of what SME can do with emphasis on indigenous design, development and manufacture of state-of-the-art Simulators, which can compete with world-class products. Defence ProAc interacted with Mr. Ashok Atluri, Managing Director - Zen Technologies Limited. Leading from the front Mr. Ashok Atluri with his shear drive and determination has lead his team to create indigenous capability. Some excerpts…
Zen Technologies has over the years has emerged as a strong player in the field of defence training simulation in India and has been steadily expanding its footprint overseas, specifically Middle East and Africa. Moreover, company has recently bagged an order around 30 crore to supply training simulators to Egypt. Such a breakthrough in achieving self-reliance and promoting exports by Indian SME is really commendable.
Defence Pro Ac (DPA): What are Zen Technologies footprints in the global simulation market and supply chain? How you visualize the simulation market in the coming years? How you differentiate the simulator market requirements in India and abroad?
Mr. Ashok Atluri (AA): In last 24 years, we have designed and developed more than 30 defence simulators with complete ownership of IP.
Furthermore, in terms of software we are at par or better than global players and have the desired capabilities and knowledge base across various verticals enabling us to create simulators with realistic scenarios and provide soldiers with accurate feedback and training, increasing their combat readiness levels.
Additionally, Zen Technologies is the one of the few indigenous companies that is developing solutions ground up. Other players in the market are tying up with Foreign OEMs to meet the tender criteria with no real R&D is being done in-house and in India. Also these tie-ups are not addressing the core issues of our defence forces which lay special emphasis on modifications and customizable solutions which can only be achieved through a strong and robust indigenous R&D capability.
The use of simulators as a training and operational readiness tool in the Indian military has risen considerably since the 2000s. Today, simulator use in the Indian Armed Forces has expanded far beyond traditional aggregate/constructive simulation for war-gaming purposes to virtual solutions tailored to providing individual and collective driving, flight, gunnery and sensor training.
Among the major factors driving the Indian Military training and simulation market are the cost/safety/time benefits of using simulators for training and the modernization programs of the Military and Police Forces.
Technological advances that allow the replication of a wide range of combat scenarios, some of which cannot actually be done in live-training are highlighting the role that simulators increasingly play even in refining concept of operations (CONOPS).
DPA: As per SIPRI data India has about 13% share in the global arms import during 2012-16. It is matter of concern to all Indian that despite of huge infrastructure in defence production we are still the World largest importer of defence equipment. Indigenous contents in our defence products is just about 40 per cent. How in your views the issue can be addressed?
AA:.With the introduction of the new DPP, we are very sure that companies like Zen, that have believed in designing and developing India's own IP, will benefit tremendously. Provision that cut short the procurement cycle, focus on industry R&D funding, getting assured orders, etc., will ensure that Indian defence companies get good business and ensure that India not only satisfies about 70% of national requirements but becomes a major exporting country of defence equipment.
DPA: In addition to existing defence capabilities created by Zen Technologies so far, What are the new products in the pipeline?
AA:.With the threat scenario varying from conventional to unconventional (Counter Insurgency& Counter Terrorism), there is a need globally for integrated training solutions which can cater to a range of scenarios concerning a specific region. It will be our endeavour to play a pivotal role in providing the required training tools to security forces to tackle and neutralize both external and internal threats.
Zen introduced Combat Training Centre (CTC) which encapsulates a composite, comprehensive and flexible training solution to fully meet Individual and collective training requirements of combat units of the Indian armed and other forces.
The CTC is not only designed to train sub-units and units in conventional warfare but also for asymmetric warfare-Counter Insurgency (CI) and Counter Terrorism (CT). Additionally, the CTC is flexible enough with a well defined open architecture to integrate training equipment and simulators of various global OEMs, making it a truly open and customizable training solution.
DPA: Any thought on diversifications? Is there any plan to expand company product range, vertically and horizontally?
AA: It was a conscious decision taken by Zen that we will serve only defence and central and state police forces. We will continue to add products which will serve our existing target market. In past few years we have focused more on exports, offering our range of products to different countries. Presently, we are focused on developing customized Combat Training Centres, which may include development/integration of simulators and other training equipment.
Zen's primary focus continues to be training and simulation.
DPA: Is company currently participating in any of the Indian defence tender and which product is being offered?
AA: We anticipate tender for various virtual and live simulators including Infantry weapons, tanks, etc., in the next couple of years and we intend to bid for them under Buy Indian IDDM category.
DPA: As a growing firm in the defence manufacturing, can you elaborate on your platform USP offerings such Guarantee, time bound service support about life time support etc?
AA: Zen gets about 90% of its business from repeat customers. So it is very important that we keep our customers fully satisfied with products that perform well and are promptly serviced on occasions they need any attention. Such life-time support has build the brand of Zen as a leading and reliable training solutions partner in India and abroad.
DPA: What were the internal and external challenges faced by SME in defence production and what are your suggestions to the Indian startups?
AA: I think delay in getting the orders is the biggest challenge we have faced over the past couple of decades. Almost, complete detachment from problems faced by defence firm's has been the dominant theme by the procuring authorities. If you want to kill any industry that is dependent on Govt is to retract/cancel tenders, conduct long duration trials, bog the industry in lengthy communications, delay orders, put stringent quality checks which are very difficult to achieve, delay physically accepting the quality checked equipment, delay installation, and finally delay making payment to the firm. Such delay will ensure that businesses dependent on defence don't survive. Unfortunately, as of now all these delays are happening. Somehow those involved in the delay neither feel the pain of the entrepreneurs who are facing existential threat and also of the end-user who wants the equipment for better serving the nation.
Long procurement cycle has to be compressed, cancelation of tenders should not be allowed, and firms genuinely doing R&D should be rewarded to attract great talent to defence sector.
DPP 2016 was a whiff of fresh air. If the direction taken by DPP 2016 is continued then startups will find that developing great solutions will ensure that they not only solve nations problems but also make money in the process that will help them reinvest in further R&D and make India not only self-reliant but an export hub.
DPA: Can design and development of defence products be undertaken by industry in defence context? What are your in-house defense R&D initiatives? Recently Government has introduced the IDDM category, what do you thing government should do next in order to support this decision?
AA: DPP 2016 incorporated a new category Buy Indian IDDM to expand the focus from just Made in India to include designed developed and made in India. It is rather strange that manufacturing captures only 30-50% of the value of a product. But the soul of the product is the IP of the product. Not focusing on it till the recent DPP showed the hold of Indian firms that were just playing second fiddle to the international companies. IDDM, for the first time allows single vendor situations also. Now Govt will have to carefully monitor the implementation of IDDM. Many efforts will be made to scuttle the IDDM category. The way to make it flourish is to find out the products that Indian firms have and checking with end-user whether it will satisfy their needs. If the answer is yes, they should go ahead with the procurement. But if foreign vendors are given a say, they will insist on including “features” (that the end-user can do without) that will take any product out of IDDM category and go to either Buy Indian or Buy Global. We have to carefully monitor the process to ensure such tactics are caught early on, thwarted and the offenders suitably warned.
As far as Zen Technologies is concerned we will continue to focus on R&D, and we hope such focus will benefit us enormously under the new environment where IP ownership is being given top priority.
DPA: Introducing IDDM is the best policy decision government has taken to encourage defence companies investing in R&D.
AA: Absolutely, this is the most innovative step that Govt of India has taken to ensure that Indian companies, rather than enthusiastically acting as manufacturers for foreign companies, also think of innovating and creating Indian IP. But again, few success stories are needed to attract companies to invest in R&D. Let's see how the implementation of the category is done by MoD Services.
DPA: While the government is focusing on the Make in India plan and has come out with IDDM, according to you what should be the next step of Government after IDDM, in order to transform the country into a global defence equipment hub? What measures the government should take to facilitate the Indian defence industry?
AA: If Govt can focus on cutting down the time to procure and ensure indigenous technology is given preference, it will take India about 5 years to become a global player. Not only would we turned the import content to 30% but will become a net exporter of defence equipment. Rarely can so much can be achieved by so little effort. I am confident that the Govt will move in the right direction.
DPA: Your initiative “Defence Innovators and Industry Association (DIIA)”, how it's helping the MSMEs and startups?
AA: DIIA was co-founded by me along with Rahul Chaudhry (Tata Power SED), Mukesh Bhargava (L&T), Dr R K Tyagi (former Chairman HAL), and other stalwarts/supporters with the intention to ensure that defence equipment is designed and developed indigenously and MSMEs are recognized for the stellar role they can and have played in this effort. More importantly, DIIA thinks MSMEs should cooperate with large players as we have a common goal of making India self-reliant in defence.
We do meet Govt authorities regularly and place our concerns highlighting the issues being faced by defence firms particularly MSMEs and also issues that will help faster indigenization of equipment.