- Meet Bhaskar Anand Rao, a chartered accountant (CA), certified public accountant (CPA), and CFO of Bangalore International Airport Limited (BIAL).
- BIAL runs the Kempegowda International Airport and is the third-largest Indian airport, handling nearly 33 million passengers per annum.
- As CFO, Bhaskar has been instrumental in the airport’s adoption of technology to reduce costs, improve revenues and retain employees even in the face of COVID-19.
- As part of the Digital Transformation Series powered by DELL Technologies, we spoke to him to understand his role as CFO as well as how he drives digital transformation at BIAL.
Please tell us a little about yourself.
I qualified as a Chartered Accountant in 1988 and started my journey in the corporate world.
Over the years I worked in different organizations in various roles.
In 2002, I joined GMR Group. I served a long stint as CFO for the corporate sector in GMR Infrastructure, India’s big infrastructure company.
I also had the privilege to establish and manage a start-up retail supermarket, which I divested later.
Prior to joining BIAL, I was in the Middle East (Dubai), serving as the Chief Strategy & Investment Officer of a large international conglomerate. During my time in Dubai, I was handling the company’s diversification expansion program.
I joined BIAL in 2017. I have been handling typical CFO roles such as finance, accounting, project finance, treasury, and taxation.
In addition, I also head the Legal and Procurement functions for BIAL.
An airport does not only manage air traffic or passenger transportation. It also involves other aspects such as food and beverage (F&B), retail, cargo, and fuel farm. We also have a luxury hotel on BIAL’s premises, and we are developing a futuristic airport city through our real estate subsidiary.
It is a big role and I am totally enjoying it.
Bangalore airport is technologically advanced. As a CFO, what is your role in the digital transformation journey at BIAL?
Our objective has been to “Build an airport through bytes and not bricks” and that is exactly what we have done.
To avoid queues, we invested in the queue management system to improve our processes from the boarding gate and check-in to the security area. This allowed passengers to spend more time in the retail and F&B outlet area which consequently enhanced our revenues.
In addition, the tech and digital initiatives such as queue management, automated tray retrieval system, self baggage drop, etc have improved the capacity of our existing terminal by about 25%.
Moreover, BIAL launched contactless passenger boarding powered by cutting-edge technology, including contactless passenger processing, self-bag-drops, and biometric-based self-boarding solutions.
As of today, our objective is to make BIAL a paperless organization with an efficient workflow and digital data management system. Except to the extent required by a statutory requirement, we do not wish to use paper in any other activity.
What is my role in all of this? As CFO, I have been championing Digital Transformation from day one.
I am part of the decision-making process for the procurement and implementation of these systems. This is because I assess the feasibility of the company’s investments, including its revenue prospects, thereby bringing a business- and strategy-oriented mindset.
For any Digital Transformation to be a success it has to be supported and driven by the CFO.
It is said that data is the new oil. Is it true? What is your role as CFO in ensuring the effective use of data to achieve BIAL’s goals?
Honestly, data is meaningless by itself. At BIAL, we generate a tremendous amount of data and this can be meaningless if not used effectively.
For effective use, we have implemented platforms that will process the data to enhance revenue, provide additional facilities to our passengers, influence efficiency and make the organization entirely data-driven.
This will assist us in using the current and relevant data for decision-making and converting our data into oil, which help in running our operations and improving our productivity.
We have an array of concessionaires who work with us from F&B to retail, and they have a huge amount of data. They can also provide the opportunity to cross-sell, upsell, and gather all data in a meaningful manner.
My finance team and I, have the vital role of ensuring meaningful employment of data to enhance the revenue of all of the concessionaires. This is because our growth is linked to their growth.
Additionally, we are implementing an asset management software, which will help us manage and maintain our various assets regularly, efficiently and at low costs, resulting in a 20-25% saving on operating costs. My role as CFO is instrumental in analyzing the software-generated data.
Lastly, we use airline network management to see departure and arrival times, as well as assess peak and trough load periods to manage the staff and maintenance. As CFO, my role is to analyze this data and collaborate with the Chief Information Officer (CIO), Chief Digital Officer (CDO), and Chief Operating Officer (COO) to achieve BIAL’s goals.
With so much technology making decisions on what tech to adopt and what to skip – how do you choose the right technology for your company?
As mentioned, I collaborate with the CIO, CDO, and COO, who update me with relevant technological changes.
My main focus is being business-oriented. By being business-oriented, I mean that I need to understand the input as well as the output of digital implementation and the costs involved as well as the return to be expected.
Basically, I perform a cost-benefit analysis to assess the expected return on investment (ROI) which could be financial and/or on other important parameters such as customer satisfaction.
Having said this, I should emphasise that my partnership with the above-mentioned officers is instrumental in the success of BIAL.
Understanding the functionality and grasping the importance of digitizing is what the CFO has to develop. Either through experience or exposure, since this cannot be studied.
How did you navigate the challenges of COVID-19 and continuously achieve your goals despite the pandemic’s inverse effect on the global economy?
Before the pandemic, we had nearly 33 million passengers and we were growing at a phenomenal rate of 15-18% year-on-year.
We started a massive expansion program with a capital of $ 2 billion and that is akin to putting an airport within the existing airport.
As part of the expansion, we are constructing a new terminal, new runway, multimodal transport hub, and multiple access roads. I have been instrumental from the beginning, handling the financial closure, arranging the financing, and then going through the implementation phase.
Covid did put a temporary halt to the operations & expansion activities and this definitely impacted the financials of the organization. We realized that cash is not just king, it is also the emperor.
The airport is a service infrastructure and 80% of our cost is fixed. Thus, cash flow management was not easy.
Our strategy was simple and it was to optimize & reduce cost without retrenching any employee or reducing remuneration. We do value our people very much.
We managed our receivables by keeping a tight receivable collection drive to ensure we are paid all monies owed to us.
Thereafter, we managed additional liquidity from banks because we have always been proven financially strong in the industry. We tried enhancing revenue through different avenues.
To top it all, we held our partners’ hands firmly and supported them during this period. These included our F&B, retail, cargo, and airline partners. Today, we still have almost all of them through thick and thin.
As expected, we also had to face cyber threats and we quickly found suitable solutions to protect our company, employees, consumers, and all relevant stakeholders.
Even though COVID-19 is still with us and we operate at about 50-60% capacity of our pre-Covid times, we are confident in our revenue generation techniques as well as our future prospects in the industry. We are also a much fitter organization today.
What is your viewpoint with respect to the cloud? What is your involvement in decision-making for the model?
At BIAL, we have a mindset of Cloud First and Mobile First.
We use mixed solutions based on the criticality of the service. Services that are critical and local to the Airport operations, having data exchanges within the KIAB campus are generally hosted on Premises.
For services that have mixed access use and need for collaboration like emails, internal digital processes, B2B and B2C, where very high computing and storage is needed, etc.
We prefer to use the Cloud services from the tier-1 cloud service providers.
Cloud Platform gives us agility, accessibility, scalability, resilience, and centralized security and governance capabilities.
It also enables us to reduce our capital expenditure by enabling a pay-as-you-use option. However, in order to get the best benefits, we need to have a professional cloud management team that continually ensures optimal utilization of the resources.
As a part of our Digital transformation, we are setting up our own private cloud which would be used for various services which are currently hosted on-premises.
The total cost of ownership analysis for hosting on Private or Cloud models is reviewed by the Finance team, however, the technology team makes the decision in selecting the model for the various services based on a robust adoption criterion factoring all the necessary aspects Viz. Risk, Scalability, Security, Access & Governance.
Lastly with the rapid technological changes and unprecedented times, what do you think will be the role and future of new CFOs?
Previously, there was no role such as the CFO. Instead, companies had a Vice President/Director of Finance.
The role has evolved over the past couple of decades and from being seen as number crunchers with spreadsheets and calculators, CFOs have evolved to becoming Key Managerial Personnel (KPM).
The introduction of Application Programming Interface (API), Robotic Process Automation (RPA), data analytics, the Internet of Things (IoT), blockchain technology, as well as cloud computing, have had a tremendous impact on the role of CFOs nowadays and in the future.
Today, a CFO is closely associated with digital transformation for an organization.
The future CFO in addition to normal duties will have to understand the regulatory and legal aspects of the business and be digitally educated before taking the CFO role.
Learn every day and be ready to experiment.
