Driven by quality: backward and forward integration in Sobha developers; in conversation with P N C Menon

Abstract

Incorporated in 1995, Sobha Developers, a Rs 12 billion company, is widely acknowledged as an industry benchmark for world-class building techniques and quality standards. With a clientele including IT giant Infosys, Hewlett Packard, Dell and the Taj Hotels Group, the company enjoys a reputation for reliability, dependability and honesty. Sobha has been awarded the ISO 9001 (2000 series) certification for adhering to global standards in quality, the CRISIL rating of DA1, assigned to developers, the Brick and Mortar Award for the South Zone in the a+d & Spectrum Foundation Architecture Awards 2005, the Project of the Year Award for the year 2005 by the Builders Association of India for the Infosys project at Mysore and the ‘Best Executed Project in India’ award for “Sobha Malachite” at the CNBC Real Estate Awards 2007. For a high growth niche player, Sobha has a unique business model that combines both backward and forward integration within its vertical, besides diversifying into lifestyle products and information technology. Prof K Kumar of IIM Bangalore spoke to its Chairman, Mr P N C Menon, about the rationale for this model, which defies contemporary management thinking. A deep commitment to quality, as well as the personal philosophy of its founder, it emerges, are the driving forces behind this unique business strategy and admirable entrepreneurial success. Discussing the future of the company, now successfully listed on NSE and BSE, he talked about the company’s recent IPO and its plans for expansion, as well as the need for corporate India to contribute to the country’s economic growth and the welfare of its people.