Friday, 30 March 2012

A Case of Spoiled Engros

It was somewhere in the early part of 2010 when Asad Umer (the legendary leader of Engro Corporation) was speaking at a Business School when I heard him talk about “values”. He explained the concept of pure passion fused with the desire to win are the best things to have given you stick to the values that define you. The Afridi ball chewing incident was fairly recent then and he took it to explain how things can go wrong if you can no longer distinguish between right and wrong, Afridi just wanted to win even if it meant tempering the ball in front of a zillion cameras. I guess the Shakespeare’s “The sun itself sees not till heaven clears” explains it better and I admit I remember the quote from the Julia Styles movie.
Afridi chewing the ball in the series against Australia, February 2010
It is extremely disturbing for me to see Engro who all of us saw as the saviour become the organisational Afridi, so what exactly has it been chewing upon publicly? Let’s start with the products we commonly come across, Engro Foods Omore Desi, a replica product and promotional campaign to the Walls Badami. When the Omore Kulfi failed the best available option was to copy the multinational competitor right down to the wrapper print. Just get rid of our existing product and create something that will sell as good as Badami, copy the colours, the ad, jiggle and give it a bit of Punjabi touch. What can you do “original just does’nt sell”.
A rattling slap over the earlier celebrations of a local company surpassing the dreams of a multinational giant, Unilever. With all its claims of being a great Pakistani company all it can think of to generate sales was to bow down to Walls.
A side by side view of the two products, Walls Badami and Omore Desi Kulfi
They have been good at hiding the traces, this is the only image I could find which shows the original green wrapper Omore Kulfi along with the Choc Bar
Another product is the Dairy Omung, a tetra packed milk made from milk solids (powder milk). Just because the market is ignorant you are selling them liquid milk made from a less expensive powder form. For those of you who do not know, many industrial applications of milk such as confectionary  and ice cream use powder milk available in bulk industrial packaging. It is both imported and locally produced in Pakistan. It differs slightly to the powder milk available for domestic use with brand names such as Nido or Millac. My concern here is not the product or its quality rather the ethical implications. The Pakistani market believes that tetra packed milk is better because it is pure and natural; on the other hand powder milk is considered to be a synthetic product. Using this behaviour Engro decided to tetra pack powder milk, if I must the ongoing war on sourcing liquid milk between the competitors was also an important reason along with the production efficiencies attained by a readily available raw material.
Some argue that since clean water is not available to everyone Dairy Omung is doing the nation a favour by combining clean water and milk powder in safe packaging, they show a few naked kids running around in the slums and freeze the frame on their puppy eyes. Oh come on you seriously believe that BS, as if Dairy Omung was hydrating their lives.
When stories about Kony’s LRA atrocities in Sudan & Uganda emerged it was said that young boys were forced to kill their mothers and asked to join the LRA or choose to die. I am not going to comment on Kony and LRA but instigate that our value system can only take a certain amount of beating. I think Engro’s value system has taken its dose of beating and has joined the LRA. Those of you who have read this far will be curious about the beating in question; well the fatal blow was the methane supply restriction. Engro Literally breaths methane, its massive investments made in the Dharki urea plant expansion at a time when the dollar jumped from 60 to 80 nearly overnight had already cost it a fortune. It hoped with the largest Urea plant the increased production will cover everything, Mari natural gas fields were supposed to be the endless methane supply; at least that was the plan.
The reality is that Engro Urea production has never operated at the optimum level; gas supply limitations have caused massive losses. All the fancy operations it had such as Foods whose existence depended on urea sales started having frequent top management meetings and the results are jotted down above. The cost of urea bag increased constantly but has only been able to slow the fall.
I believe that Engro had started chewing it self long before the natural gas supply restrictions were imposed, the internal politics coupled with hiring & promotions based on references had spoiled it enough. The individuals chosen by the white who were groomed up to be leading the company today are not being recreated. I wonder if another buyout for Engro comes by, will the existing pool of employees be willing to sell their homes and save the company, this happened in 1991 when Exxon became Engro.
I love Engro and sincerely wish it sticks to the values it once believed in. The people who say everyone else does it to survive, so why cant Engro? For the answer I heard the smartest thing from the most unlikely of sources, my boss’s driver once said to me “if a dog bites you, you don’t bite it back”. Now who can argue with that? I considered him as an unlikely source because of my boss and please don’t ask me why we had that conversation.

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