Learning by Doing
Rajesh Babu Shrestha believes in ‘learning by doing’. This is why even though he has only completed his bachelor’s degree, he claims to have made many changes in the business processes of his companies and jokingly says that he is currently completing his practical EMBA by studying in his own companies.
Shrestha is the managing director of his family business, Chitwan Construction and Engineering Company Nepal (P) Ltd. and holds the same post in his other companies like the Manakamana Cable Car (P) Ltd. Because his family is one of the oldest and most prominent player in the construction business, it has been involved in many large scale projects like the Phewa dam, Begnas dam, Manipal Medical College , Phulbari Resort, the cable car complex of Manakamana Cable Car. As a result, Shrestha got the opportunity to work with many renowned foreign companies like Hitachi and observe their methods. Based on these observations, Shrestha claims that he along with his brother have improved the platform that their father created.
So what have the sons done? Shrestha claims that they have applied modern management techniques in the construction businesses. They have computerised the office work, set in processes to delegate authority, and even loaded a local Nepali software for accounting and ticketing (at Manakamana cable car) and this has given the businesses a corporate touch. But he candidly says that there is a lot more to be done in this regard by his own group and by the Nepali businesses at large before they become truly professional.
Talking about his youth, Shrestha says that he had actually wanted to study engineering but decided against it after his father said that it would not suit his nature. So after completing his I. Sc. from India , he started morning B.Com classes at People’s Campus and worked for his father during the day.
Shrestha’s “learning by doing” method came to the fore while setting up the Manakamana cable car system. This was a daring move because his group did not have any experience in such a venture. They, however, went ahead with the project because it had been a long-time dream for his father, who was born in Gorkha and wanted to contribute something in the place where the Manakamana shrine is located. It used to take Shrestha’s father seven days to walk down from his village and he always wished he could just hang on to a rope and get there. Being religious, the Shresthas thought cable cars could help ferry disabled people who were unable to walk the distance. They would also attract tourists.
So utilising their expertise in construction, the cable cars were set up within 10 months in 1998. “We actually took all the construction material up the hill by helicopters. We were the first to do this in Nepal ,” boasts Shrestha. The cable car business started with roaring success and according to him, they were even paying back their loans in advance.
But unfortunately, after about three years of successful operation, the Nepali economy was in the doldrums. But according to Shrestha, his group was undeterred. Unlike some other businesspeople who chose to hide from banks, his group was proactive in talking to them, he says. “We found that when we talked to the banks, there was no distrust between us. Instead of the targeted five years, we paid back the loan in seven, but both parties benefited – the company continued its business and the bank got the money back.” Some people with ill intentions have tarnished the name of the business community but if you have the right approach, there are always ways to deal with problems,” he states. Shrestha also says that his group is strongly guided by the principle of Corporate Social Responsibility (CSR). He claims that any venture that his group undertakes should be relevant to Nepal and its economy in terms of revenue paid to the government, the impact on the area they invest in and employment generation. Though critics may remark that any business set up will automatically produce such results, in reality, a heightened sense of CSR does actually make a lot of business sense, says Shrestha.
For example, the group has been actively involved in the local community development in Gorkha where the cable cars are set up, says Shrestha. Initially there was mistrust among the local people and the group was accused of taking away peoples’ jobs – especially of the porters and roadside restaurants. But in due time, local people have realised that more tourists come to Manakamana because of the cable cars and this has created new business opportunities. The group also buys local produce and provides jobs to the locals in the cable car business. Shrestha’s father also helped to bring water supply to 20 Village Development Committees (VDCs) with the help of the Indian Embassy through its Manakamana Development Committee. The group also contributes Rs. 750,000 each year to develop the local villages. “Our relations with the villagers are excellent and obviously this helps our business too,” says Shrestha. He claims that the software for ticketing and accounting were developed by Nepali companies.
Keeping the CSR and the ‘learning by doing’ themes in mind, the Shresthas are about to invest in a new venture by starting a milk processing factory in Chitwan. Shrestha informs that some two-thirds of Nepali farmers are involved in producing milk and in the flush season, 150,000 to 200,000 litres of milk is produced in excess of demand every day and wasted. So, the Shresthas are setting up a factory with the capacity of producing 15 tonnes of powdered milk per day, which will start operation from 2065 BS. Shrestha says that this will greatly benefit Nepali farmers as well as stop the outflow of foreign currency that is used to buy powdered milk.
On a personal level, Shrestha is involved in a litany of social organisations. For example, he is a board member of the Nepal Tourism Board, a member of the Rotary Club of Thamel, and the President of Nepal Body Building Association under the National Sports Council. The body building association is currently reviving the Mr. Himalaya contest and is increasing the prize money to Rs. 300,000 and even holding a South Asian meet under his leadership, says Shrestha. He reveals that to be involved in such organisations is not just for a social cause. “I build my business network through these organisations and the contacts I make there help me professionally as well,” confides Shrestha.
Shresthas have divided their tasks in an interesting way. The father looks after policy matters, the elder brother looks after projects-implementation and Shrestha likes to call himself a liaison officer who deals with banks and government offices. Shrestha has to play this role because, according to him, Nepali culture has a very top-down approach. “People do their jobs only when they get orders from higher up,” he thinks. “Our group believes in the bottom up approach and our staff try to go through the normal process while completing their tasks. Unfortunately, more often than not, I have to get involved to get the job done from the top.” But Shrestha is optimistic about the future because he has observed that now many secretaries in the government are young and they have a positive attitude about developing Nepal .
And while selecting employees, the ‘learning by doing’ method emerges again. Shrestha says that his companies have standardised processes but they look out for ‘doers’ rather than degree holders. “Sometimes when we interview people, even if they do not have the required qualifications, we may hire them. If we think they can do the job better than a degree holder, then why not hire them?” he asks.
In the future, the Shresthas are looking to investing in hydropower and this will again be a ‘learning by doing’ process for them. The group is holding discussions with Chinese parties on this matter. “This is another area that will benefit Nepal ,” concludes Shrestha.
