Is Intex On A Suicidal Mode?

Intex Technologies, the makers of Intex mobile phones, seems to be in deep trouble. The firm that rose to heroic success in Indian mobile phone business in a short span of time, at times dethroning Micromax from its #2 position and even teased Samsung to snatch its crown, is now going south at the pace of a free falling body. And the force behind this fall is not market competition, rather all internal. Or, you can say, management issue.

Everything about the company, now, is in shambles. Starting 2016, all ingredients required for a company to remain afloat in the market – people, processes, and business – are seen consistently drifting away from the Narendra Bansal founded firm that deals in computer peripherals, mobile phones and new product line up of home appliances like washing machines, TVs and air purifiers.

Financials
For the first time in its journey of mobile phone business since 2010, Intex is expected to see a decline, and that too a huge one in this fiscal. The company that posted a revenue of around Rs 5,500 crore in 2016, is expected to clock close to Rs 3,300 in FY17, a drop of almost 40%.

“In the last two quarters sales have declined drastically,” says a company insider not willing to be identified. “We are doing around Rs 250 to 275 crore a month,” he adds.

Taking that as average, Intex could post around Rs 3000 or Rs 3300 crore revenue in this fiscal, a drop of 40%, which will take them back to two years. In FY 2014-15 the company’s revenue from mobile phone business was Rs 2800 crore of its total revenue of Rs 3749 crore.

The executive, who works closely with the senior leaders at the firm, is afraid of more difficult times in the next two quarters. “We do not have a product roadmap ready till March,” he adds. “It was prepared only till October and it is exhausted now. We have nothing new to offer.”

It appears suicidal for the company as for the last 4 years, mobile phone business has been the mainstay of the company’s revenue. In 2014-15, company’s revenue contribution from mobile phone business was 72.21% that rose to 87.31% in 2015-16.

People & Process
They say your company is what your employees are. However, this does not seem to hold good for Intex Technologies. The company for the last two years is seeing exodus of its highest degree. More importantly, the people who had made Intex as a popular brand in the Indian mobile phone industry have already left the company.

Interestingly, they have joined rival companies. For example, Sanjay Kalirona, who was the man behind establishing Intex as a mobile phone brand, had quit the company in July and joined rival Zen Mobiles. In his 6 years stint with Intex, he successfully propelled the company’s revenue to Rs 5500 crore in 2016 from mere Rs 200 crore in 2010. Similarly, Deepak Kabu, who was the second-in-command at Intex after Sanjay, has left the company to head Ziox Mobiles, a Chinese brand operating in India. Intex’ former product head Sudhir Kumar also joined Itel Mobiles as its India head.

These three people were the backbones of Intex Mobiles till early 2016. However, the management simply did not put any effort to retain these high-productive employees, the sources said.

“Its an autocratic company. Narendra Bansal decides what would happen with the company, irrespective or his domain knowledge or repercussions,” opines two more company insiders. The insiders who did not want to be named also said, many a times, Bansal asks people to simply leave the organisation. “They are not even allowed to serve the notice period,” one of them said. “The company does not have professional HR structure or defined policies in place,” the other added.

In the last few months, as many as 100 to 120 people are quitting the company on a monthly basis. They are also hiring 50 to 60 people at the same time. But the attrition rate has been very high, and many of the new hires even do not stick to the company more than few months.

All these factors have taken a toll on the company’s overall performance. Over the last one year, the company’s market share has gone down. As per some reports Intex’s market share stood at 6.4% in Q2 compared to 8.4% in Q1, and the company is no more in the top 5 mobile phone brands.

What Intex Needs To Do
The first and foremost, the company needs to come out of the mindset of a typical kirana store run by families. There are many family-owned global companies but they had adopted a robust process driven operational structure where the company is run by some set rules and policies, and not with some whimsical ideas or decisions. Second, the company needs to check the attrition on a war-footing. The vacancies at the firm needs to be filled up with right candidates at the earliest. Intex last month hired Unnikrishnan Mohandas Thazhath as its General Manager of product to fill the vacancy of Sanjay Kalirona. It is a relief for the firm. But there’s rumor in the market that he is too mulling to leave the company. Third, a futuristic and realistic product road map should put in place, keeping the customer demands for the next year.

Unless the top management looks at these aspects of the company with a serious note, leave aside being in top 10, it would be difficult for Intex to survive in this highly competitive Indian mobile phone market that is being flooded with Chinese brands.

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