Serve with Love
UNSUNG HEROES OF INDIAN
By Naresh Kumar
On a hot muggy day in
Chennai (is there any other kind?), I step out to go
to Annanagar.. Problem is, my knowledge of the city
is rudimentary. Armed only with residual memories of
the one and only time I had been to that area, I gamely
flag down an autorickshaw.
“ Annanagar”, I tell the driver, hoping
that my brazen confidence would hide my ignorance, and
save me from a highly probable fleecing.
“ Where in Annanagar, saar?”, he asks with
a wide smile.
A small flutter of alarm.“ Er… um…
the main road.”
He gives me a slightly puzzled look. “ Annanagar
has many main roads, saar. Which one?”
“You know, the road which has Foodworld in it”
A blank look. “Do you know the road name, saar?”
HDFC bank?” A shake of the head.
Despair. And then a flash of
“ Saravana Bhavan?” I ask , with the air
of a soldier firing his last bullet at his last enemy.
And finally, magically, a clearing
of the clouds on his face.
“ Saravana Bhavan! Why didn’t you say so
earlier? Everybody knows Saravana Bhavan, saar. 30 Rs,
saar. Get in, get in.”
I settle in thankfully, as
the inevitable chatter flows back over the driver’s
shoulder towards me. And I wonder- how is it that such
famous names as Foodworld and Nilgiri’s do not
ring a bell with the auto driver, yet a relatively unknown
name like Saravana Bhavan has become a landmark?
Curious, I decide to find out
a little more. I go to a Saravana Bhavan outlet. Eat
there. Meet the manager, and talk to him. Buy a book
written by the owner of Saravana Bhavan. Read it. And
put it down feeling a little awed, a little humbled,
and a lot inspired.
This is the story of a visionary,
a philanthropist, an astute businessman, and arguably,
one of the great retailers of all time. A man who, through
sheer hard work and perseverance, rose from humble beginnings
to become a person who is almost worshipped by his employees.
A man who brought security and hope to the lives of
his 4000 odd employees, and great tasting, yet cheap
food to millions of people in Chennai. The man who set
up Saravana Bhavan – P. Rajagopal, affectionately
known as “Annachi” (elder brother) Rajagopal.
THE EARLY YEARS
For those who are still in
the dark, Saravana Bhavan is a vegetarian restaurant
chain that specialises in high quality South Indian
food. Saravana Bhavan today has 14 branches in Chennai,
one branch in Kancheepuram and one has recently been
opened in Dubai. The chain has a total turnover in excess
of 50 to 60 crores, and employs over 4000 people.
All this, of course, could
not have been foreseen by the worried young man who
sat on the floor of his little grocery shop in Kodambakkam
(now within Chennai precincts) circa 1970. P. Rajagopal,
born in Punnaiadi in Thirunelveli district of Tamil
Nadu, had good reason to be worried. After a succession
of jobs as a cleaner in a restaurant, attendant in a
vessel shop, grocery shop attendant etc., he had finally
set up his own grocery shop, with some financial help
from his father and brother-in-law. He had started the
shop with his brother and his cousin. Unfortunately,
the shop was located near a harbour, which meant that
the bulk of his customers were drunken harbour workers,
who would heap filthy abuse on them and demand loans.
Rajagopal would bear it all with a smile, because the
financial obligation to his father and relatives made
him dread to think of the consequences of closing down
the shop. His brother and cousin were not so patient,
however, and one fine morning he found himself alone
in the shop.
Rajagopal faced his first true
challenge with characteristic grit. For more than a
month, he ran the shop alone, doing everything, from
sourcing the items to manning the shop himself. He then
talked to his brother and convinced him to come back
and join him. Soon his cousin also came back. Slowly
but surely, business began to improve. He soon set up
a chain of grocery stores called Murugan Stores, which
quickly acquired a reputation for high quality goods.
As he was talking to his employees one day, a chance
remark sowed the seeds of the success story that is
Saravana Bhavan. One of his employees requested him
to finish the meeting early, since “there was
no good restaurant in the locality, and they had to
go all the way to T-Nagar for lunch.” Ever alert,
Rajagopal sensed the opportunity, and resolved to set
up a restaurant.
Overcoming various financial difficulties, Rajagopal
started the first Saravana Bhavan in 1981, in K.K.Nagar,
with two partners. The first cloud on the horizon came
in the form of a disagreement with one of the partners,
who thought they should use cheap quality foodstuffs
in order to maximise profits. But Rajagopal was adamant-
he had a burning desire to set up a restaurant that
would be reputed far and wide for the excellent quality
of food provided. Having been in the grocery business,
he had good discernment when it came to the quality
of foodstuffs. This disagreement soon led to a parting
Initially, it seemed that the
partner was right. Rajagopal says in his book that in
the first few months, he used to incur a loss of Rs.
10,000 each month. But he stuck to his guns, and soon
his gamble began to pay off. Saravana Bhavan slowly
gained a reputation for excellent tasting food, and
traffic began to increase. The hotel turned profitable.
Rajagopal celebrated the first anniversary of his hotel
by having a scheme whereby customers got 23 items for
just Rs. 5. The resultant buzz was huge, and made them
the talk of the town. Saravana Bhavan had arrived.
THE TRIPOD APPROACH
One could cover the story of
the next 20 years by putting just a couple of ditto
marks. But behind the ditto marks lies one of the great
retailing stories of all time.
It was very simple, really.
Rajagopal boiled the situation down to its basics and
realised the following : retailing is essentially a
service business. Service business means there is one
set of people (employees) serving another set of people(customers),
and helping them to buy a product. Three parameters.
Success depends on doing a great job on all three fronts.
The product is in many ways
the easiest. Rajagopal ensured only high quality ingredients
in all his kitchens. He assiduously took down all customer
complaints, and suggestions regarding food taste, and
constantly strove to improve the taste of his food.
He spoke to various specialists at length to determine
ways to improve the taste of his food, and spent hours
in the kitchen with his chef, experimenting and trying
to find the perfect balance of ingredients. He would
take his experts along with him to the best restaurants,
and eat there, so that they could figure out how best
to get that taste.
But the customer, of course,
wants more than just the product- it is the entire experience
that counts. Rajagopal ensured the highest standards
of hygiene in his hotels. All employees had perforce
to have a bath before they reported for work. Rajagopal
introduced the system of having banana leaves cut to
a round shape, and placed on the plates, on which the
food was served. This had the dual advantage of assuaging
the customers’ natural queasiness regarding eating
from plates on which someone else had eaten, and making
it much easier to wash the plates. Service was also
quick, and the staff, neatly dressed in uniforms, was
courteous. Even in the case of abusive customers, they
would only go and report it to the manager, who would
then discreetly speak to the consumer, and gently but
firmly tell him to behave in a civilised manner, or
Easy enough so far. But what
most people miss out on is the third cornerstone –
the employees. It is in many ways probably the most
important, since the first two are ultimately dependent
upon the employees for their successful implementation.
Rajagopal had a mind that recognised this fact ; remembering
his early days, his heart, overflowing with genuine
concern for his employees, made him take employee care
to unprecedented, almost philanthropic heights. Says
he “Our employees who have laboured day and night,
sweating, are the mighty pillars of our huge establishment.”
No empty words.
First and foremost, he gave
them job security. The norm in those times was for employees
to be periodically terminated. In his own words, “We
removed the words periodic breaks in the employee’s
service from our vocabulary.” He then increased
their pay substantially. He provides accommodation to
employees and their families near their place of work.
Employees holding responsible positions are given telephones
at their house- entirely at Saravana Bhavan’s
expense. Employees with families in villages receive
annual grants to go visit them.
He provides for the education
of the children of the married employees – two
children per family, irrespective of their position,
are educated from nursery to post graduation college,
entirely at Saravana Bhavan’s expense. This includes
their uniforms, books, and all other associated costs.
All employees are given uniforms by the establishment,
and receive new clothes during festivals like Pongal.
Wives of married employees also get new clothes.
For those who have put in ten
years of service, LIC policies of 50,000 to 1 lakh,
depending on their position, are taken. The premiums
are paid entirely by the establishment. Medical insurance
policies, under the Employee State Insurance scheme,
are taken for each and every employee. The employees’
contribution component is paid entirely by – you
guessed it- the establishment.
It doesn’t end there.
If any member of the employee’s family falls sick,
two boys are sent to the hospital to look after them.
Food for the patient, and one more family member, is
sent every day, till the patient recovers. If the patient
has to undergo treatment at a private hospital, all
expenses are borne by Saravana Bhavan. Vehicles, ranging
from cycles to mopeds to even jeeps, are given to employees
depending on their position. There is an incentive scheme
every year, wherein employees can win durables like
fridge, TV etc.
It still doesn’t end!!
Parents of each and every employee,
who live in villages, are sent Rs. 200 each month by
the establishment. Every two years, a certain number
of employees, selected on the basis of certain criteria,
are sent to Singapore to attend an exhibition of hotel
and kitchen equipment, as part of their training. The
entire costs of travel stay, and even buying some items,
are borne by – Ho hum – the establishment.
Similar inland trips are also conducted to different
places like Bangalore, Mumbai etc., as part of the employees’
But the scheme that he is most
famous for is the Mani Ammal Marriage Scheme (named
after his mother). This scheme is for the daughters
of employees who have put in a certain number of years
of service. Under this, Rs. 10,000 is invested on a
long-term basis in the name of each daughter of the
employee (up to 5 girls per family). The amount accrued
over a number of years is of substantial help when the
girls reach marriageable age.
What are the reasons why .the owner of a chain of restaurants
takes such incredible steps for the welfare of his employees?
One is, of course, that it makes sound business sense.
Rajagopal says, “As we give these facilities to
our employees, they have a zest in their lives and a
confidence in their future…many come seeking jobs
to us…their basic problems in life being solved,
they are able to work with dedication….It is no
exaggeration to say that because we have workers with
us who are dedicated and devoted, Saravana Bhavan has
grown from strength to strength.”
This magnanimity also made business sense in a more
indirect way. Rajagopal was shrewd enough to realise
that in retailing, the staff is the key medium of communication
to the customers. A great deal of consumers’ perception
of the restaurant was dependent on the staff. Rajagopal
was like a benevolent godfather to his employees, and
that also allowed him to be strict with them- which
he was. Employees had to have a bath every morning,
or else they were not allowed to report for work. They
were supposed to have a haircut once a month, so that
chances of customers complaining that they had found
hair in the food was minimised. No employee was allowed
to drink. They were not allowed to watch late night
cinema shows, since that may affect their performance
next morning. All this led to associations of extreme
hygiene with Saravana Bhavan, which in the South is
a huge advantage.
The other reason has more to
do with the personality of Rajagopal. Having come up
the hard way himself, he decided that no one under his
employment should have to face the same problems, ever.
Says he “My profession is business…..Business
is one of society’s activities….if society
will prosper, my business will prosper……my
goal is not simply to get profit from my business..
there should be honesty and justice in my business…out
of my earnings, I should help others to the extent that
I can. That is why we don’t throw away any leftovers
in the kitchen.. we distribute it everyday among the
And therein lies the secret mantra. Across the world
there are good companies, and then there are great companies.
What distinguishes the great companies from the merely
good is that they raise their sights from ground level
agendas like profits and growth to a much higher level,
where they look at business as a social activity, with
a social purpose. With this perspective, profits become
no more than a necessity to fuel the true purpose of
the business i.e. social development, rather than the
purpose itself. Legendary companies like 3M and Merck
are examples of such organisations. 3M’s mission
statement – “To develop products that will
make people’s lives easier.” No profits,
no turnovers, no market shares. The irony of course,
is that such companies are, incidentally, hugely profitable
– they last for 50 or more years, and are legends
in the business world.
It’s simple, really.
When you truly aim for the skies, you don’t even
notice when you clear the Empire State Building. Today
Saravana Bhavan is a landmark for an autodriver in Chennai
– as it becomes more well known, it may well become
a landmark in the retailing world itself.