3. Support Customer for Euro compliance, Foundation of Credibility and Trust

[2] DNKI “Sick Company & Recovery – A Setback Not Many Could Endure

DNKI Striving for Excellence and Social Contribution

Systematic approach to make the company back to ‘Black’.

For any organization, being labeled a “Sick Company” is a major setback, both financially and reputation-wise. DNKI was in such a predicament when it faced negative profits in FY10 and FY11, leading to a loss of capital and the company being classified as a “Sick Company” as per Indian legislation. This status not only affected the company’s financial position but also caused damage to its brand reputation among key constituencies.
Immediate action was needed to move the company out of “Sick Business Status” and bounce back as soon as possible. And that’s exactly what the management team did. They devised a plan to increase productivity and reduce costs in all areas, which was announced as a recovery plan covering fiscal year 2012 through 2016.

Combining Proactiveness with Quick Reaction
Strong Cost Competitiveness in Making Fixed Cost Reduction

During FY10 and FY11, DNKI had negative profit of around 11% in both the years, resulting in Capital Erosion. The reason of this situation was due to Rupee depreciation against Yen and, Quality Issue. Had to declare Company status as “Sick Company” as per the Indian Government law. The impact would be loss of Brand image amongst stakeholders. Company needs to act quickly to bring it out of Sick Company Status and also get back to Black Profit as quick as possible.

It was a daunting challenge that would require the entire team’s dedication and hard work to turn things around. To get better quickly, DNKI took several proactive steps, such as sending structured messages to employees and customers like Toyota Kirloskar Motor. The objective was to make everyone aware of the situation and the need to change the working style.

Hence, management planned to improve all aspects of cost and job efficiency so that we could achieve it quickly. The Management post discussions with HQ announced Recovery Plan from FY 12 until FY16. Having said that the Company achieved Black Profit from FY14 onwards.

This was appreciated by the DNJP management for DNKI consistent efforts by Honoring “DENSO President Award of Honor – 2015”.

Reversing the Fortune through Sheer Hard Work

To maintain an optimal stock, it was necessary to perform periodic operations optimization. It was a sustained effort that required everyone’s dedication and the DENSO Spirit of Collaboration and effective communication. It wasn’t easy, but by putting in the hard work and staying focused on the goal, the company turned profitable at the end of FY14, and that trend continued into FY15.

DNKI could achieve it with lot of contributions from employees, IGCs, OGCs, HQ, Business Partner, and Customer by taking various initiatives. Some of the key activities are explained below.

DNKI started some aggressive activities to recover quickly with Structured Communication to Employees and Customers like Toyota Kirloskar Motor. Through this effort, company could sensitize the members of situation and need of change in approach in our work-way. Further, to come out of Sick Company status funds were injected by DNJP also this helped the company in reducing the interest expenses. Simultaneously “Cost Structure Innovation Task force” was created and EEL (Expenses Hearing for Expense Control) to evaluate all expenses and made decision to spend only where there is no way. Some expenses postponed and some activities like Zero OT, Reduction Application Cost, Shared Services Cost and APR with Customers. Inventory optimized from time to time by taking special care operationally as continuous process. Through these focused efforts by FY14, we achieved Black profit and continued next year as well.

Of course, this was achieved due to the focus of entire DNKI members, with DENSO Spirit of Teamwork and Strong Communication.
DNKI aiming for recognition in High Excellence

The leadership of DNJP recognized DNKI’s dedication by bestowing upon it the “DENSO President Award of Honour, 2015.” Many people at DNKI helped get the job done, including the IGCs, OGCs, headquarters, business partners, and customers. It was a collective effort that helped the company overcome the setback and emerge stronger.
The “Sick Company” status was a tough pill to swallow, but it was a defining moment for DNKI. It was an opportunity to come together as a team and show what they were capable of achieving. The lessons learned during that challenging period have helped the company become more resilient and better prepared to face any future challenges that may come their way.

History of Customer Awards and Recognitions:

1st Award in 2002: Customer Toyota Kirloskar – “Best Supplier Award”
2017. Customer Toyota Kirloskar – Best Technology Adoption – Best Self-reliant Supplier
2018. IATF 16949 Certification (2013. OHSAS 18001 Certification, 2001. ISO 14001 Certification)

Social Contribution as a major driving force

To support the local community, initial years CSR focused on contributing to the local region primarily on Education, Youth Development and Old age Support wherein we have contributed to schools in the form of Stationery, Games Material and Kitchen Materials.