It shouldn’t come as much of a surprise to hear a managing director of a multi-million-dirham logistics operation claim the key to success is strategy.
After all, if a solutions provider can’t effectively strategize in order to get the job done, who in the world can? So the less-strategic out there should take some comfort from Abhishek Ajay Shah’s admission that one of his earliest and most prominent mistakes when creating his company, RSA Logistics, was a distinct lack of strategy.
“In the beginning you’re very opportunistic and as a leader you tend to wear many hats at many different times,” he said. “As the company has grown, we’ve become a lot more strategic but it wasn’t always the case.”
The managing director dedicates his “lack of a fall back plan” on the ‘Dubai Boom’ of the mid-2000s.
“Anyone here in 2006 would never have thought Dubai would stop. There was almost a brashness at that time and everybody was operating in a kind of euphoric mindset,” he said. “There was money in logistics. The rotation of cash was simple and it would have been easy to take the money and accept that was all there was.”
However, as was the case with the majority of the business world, the economic crash of 2008 hit the heart of RSA Logistics and a sudden requirement for “Plan B” was immediately necessary.
“In hindsight it would have been better to have a much more structured business plan,” said Shah. “We only had a handful of customers, who all disappeared practically the day we opened.”
Other mistakes include diving into a foreign market with little knowledge of customer requirements, as well as not making the right investments early on.
“We saw the potential in the aviation industry and the car auto and servicing – with regard [to] spare parts – arenas,” said Shah. “We didn’t go down that route in terms of the software systems we required and looking back, it’s maybe something we should have considered.”
While Shah admits there have been “missed opportunities”, something that “pinches” on a regular basis, he is also realistic and believes there is also no way of knowing how it would have gone.
As it turns out, RSA went a different way – a rather successful different way.
Conceived in 2007 and doors open in 2009, RSA is a one-stop shop delivering integrated logistics solutions to global clients. The company currently owns and operates a multitude of assets catering to a variety of industries.
On-site management and logistics, customs clearance, supply chain distribution and transportation, integrated chemical logistics, freight services and land transportation, temperature controlled facilities and project logistics are just a handful of the services available.
Having battled the storm of 2008/09, the family-owned entity came out the other side a little bruised and battered, but with a well-thought-out strategy firmly in place.
“We wanted to be a margin company, not a turnover company,” said Shah. “The first few years were a write-off, partly also due to the fact we were building our main facility in Dubai World Central (DWC). But we then focused on strategy.”
RSA began recruiting the right people in order to grow rather than just turn a healthy profit and the business flourished. In 2007, just four people controlled and ran RSA, including Shah’s father, who began snapping up warehouse space in Jebel Ali Free Zone in 2003.
Today the company employs around 200 staff and operates facilities spanning more than 300,000 square meters.
“We’ve taken on people [who] have more knowledge,” said Shah. “We know who our customers are [and] who to say no to. For the first time, we’ve been able to turn down customers if we’re not interested in a tender because we know we’re not right for each other.”
Strategy has provided clarity, according to the 29-year-old. “I believe it’s always better to be the dumbest person in the room,” said Shah, which is tough considering he’s the managing director, a member of the board of directors at RSA TALKE (chemical transport and storage arm) and has a Masters of Engineering degree in Civil Engineering with Business Management from Warwick University in the UK.
Now based at the heart of the new industrial and transportation zone, DWC, entrepreneur Shah said RSA has grown by 40-45% annually for the past three years.
“We are still the new kids on the block [to] my mind,” he said. “You’re always going to be up against the legacy players and for this reason, I think there are three things to remember. The first is to focus on training and empowering team members to make sure they can deliver the right product at the right time. Expectations are high.
“Number two is don’t ever be afraid. We went out and created RSA Talke for chemicals, which was a bold step because it’s something people are scared of in terms of regulations. We adopted European regulations and spent much more than we needed to. But the investment was necessary to change the mindset of an entire industry.
“And the third is [to] listen to your customers. It’s very easy to create a product without understanding who actually wants to use it. Consistent dialogue with your customers is essential,” the young entrepreneur said.
As for advice for others, Shah said he would emphasize the need for technology.
“Every industry has been revolutionized by technology, nobody is immune. Things are changing so quickly and [it is] necessary to help [stimulate] rapid growth.”
Recently ranked ninth on the SME 100 list, RSA is currently opening operations in Kenya and plans to begin work on facilities in Egypt in July and in India by the end of 2016.
“We will triple the company in the next three years and have five locations worldwide,” said Shah. “We want to be known for our solutions-orientated service. I would like us to be renowned for overcoming problems in the logistics world. That would be my definition of success. Not the money.”