Kiran Gems, Getting Technology to Talk

The first time one hears the figure, one wonders if you heard it correctly. So one pauses, hesitates a bit and then carefully inquires –“121 production units?” Vallabhbhai Patel, chairman, Kiran Group smiles and nods to confirm that it is indeed true. That translates into a massive 700,000 sq ft of factory space in Surat and Ahmedabad.

And that’s not all!

Each of the units is a dedicated facility, specialising in a particular category of goods. Together they employ 24,000 skilled craftsmen and professionals, making Kiran India’s largest provider of employment in the diamond industry. And even as one is thinking that this is an enterprise driven entirely by human capital, one learns that Kiran also is single largest user of Sarin machines in the industry, 448 currently. It was one of the earliest entrants into the Sarin ‘century club’ way back in 2008, and has just become the first company to cross the 400 figure.

The volumes of stones that pass through this massive infrastructure are equally mind boggling. Each year, the company processes over 5 mn carats of rough, giving an output of nearly 1.47 mn carats of polished diamonds.

Confirming all these figures, Patel adds, “We facilitate the growth of over 1000 jewellery businesses worldwide.”

Modest Beginnings

Of course, it was not always like that. When Kiran was launched by three brothers, Vallabhbhai S. Patel, Babubhai S. Lakhani and Mavjibhai S. Patel in 1985, it was a relatively small manufacturing firm, just like so many others in the diamond hub of Surat. Growth was steady over the first decade, with the company being recognised by the government as an ‘Export House’ in 1996 and a ‘Trading House’ in 1999. In this period, Kiran consolidated its increasingly large export business by setting up a marketing arm under the name Kiran Exports BVBA in Belgium and entering into a strategic marketing venture with Millenium Diamonds Co. Ltd. in Thailand.

The first stride into the ‘big’ league was actually a relatively small one by today’s standards. But in 2001 acquiring a 750 sq ft main office in Mumbai to cope with the increasing sales and marketing activity seemed a large step indeed, especially since at that time it represented a five-fold increase over the office from which the company had operated till then. During the year it also set up a Far East office in Hong Kong.

Gathering Momentum

It was in 2003 that Kiran took a really large leap with the establishment of an ultra-modern manufacturing facility measuring 40,000 sqft at Surat, and after that there was really no looking back. The following year, the technology at the factory was enhanced with the installation of 30 new laser machines to ensure faster production.

By 2004, Kiran was employing over 10,000 people and had received ISO 9001:2000 certification, and in 2005 it moved a notch higher into the second phase of technical advancement aimed at achieving better quality and quicker production. The number of laser machines now touched 55, and along with them there were 50 marking planner, 33 planner analyser, 69 auto blocking and 63 auto bruiting machines, as well as four Dia Scan planners.

A new landmark came when the company was selected as a DTC sightholder in 2005, and the growth story continued, scaling ever newer heights.

Further expansion of manufacturing facilities at Surat – with an additional 20,000 sq ft – took place in 2006, which led soon after to a significant technical shift – the installation of 100 high speed bruters and 25 laser bruiting and coning machines to replace over a thousand conventional maxi bruters that had been in operation till then.

A Mega Leap

By 2008, after adding more factory space of 50,000 sq.ft., Kiran started production of fancies including princess, marquise, pears, emeralds, ovals and heart shaped diamonds, and also upped its production of rounds in certified stones of larger sizes ranging from 0.50 carats to 2 carats.

Within a short while annual production of fancies touched 250,000 carats, even as work started on construction of a mega diamond polishing factory and administration centre at Surat spanning 150,000 sq.ft. It was during this period that the company achieved a century with Sarin.

Yet Kiran is not only about size and scale; its systems are equally focused on maintaining the highest standards across all the production units, and today, it is known across the world as much for its consistency in make and quality of production in any category as for its volumes.

Kiran is perhaps the only company that plans every single stone on a Sarin machine, irrespective of its size. While the -4 pointers are planned and marked in lots, the +4 pointers are planned and marked individually.

Appraisals of the production systems and technologies employed are also carried out periodically, and regular upgradation is done as and when required. For example, some months ago, the number of laser bruiting machines was increased to enhance time efficiency and quality of output as it was realised that this significantly improves the shapes of the stones ranging from -2 to carat up sizes.

Moreover, different sets of production systems such as Galaxy and Helium rough machines, are used, based on the value of rough stone and expected results.

Another unique feature of Kiran’s set up is the dedicated testing area where the latest technology / machinery is installed and rigorously tested, often for a few months, prior to it being introduced on the shop floor. Different parameters are studied in this section. Results are recorded and compared against historical data, and the ease with which new machinery can be handled and used is also assessed. The section also helps to get machinery customised by manufacturers as per the specific needs.

At another level, emphasis is also given to ensuring compliance at every level, whether it is based on Best Practice Principles, or other health and safety norms. There is no room for compromised, as a specialised team pro-actively monitors these parameters across every one of the 121 factories.

Summing up the approach that has made then so big in such a short time, Mavjibhai Patel, managing director, says, “Early on we realised the importance of specialised factories with customised, state-of-the-art technology and resources, along with flexibility to do what they do best. Each of them develops quantifiable, achievable goals, and there are detailed performance records of both individuals and teams.”

Little wonder then Kiran achieves high yield from its manufacturing efforts allowing it to offer a variety of value driven services to customers such as customised assortment parcels, calibrated parcels, layout services, H&A in loose parcels and smaller sizes in huge quantities.

The company website is also ecommerce enabled, and today as much as 30 per cent of certified diamonds are sold online. The website offers a vast product range of 7,500 certified stones from 0.30 cts to 2.00 cts and above in rounds and 0.90 cts to 2.00 cts and above in fancies. The inventory is also available through other industry portals.

Forward Integration

Over a decade ago, Kiran took a decision to move up the value chain, and developed its own dedicated diamond jewellery manufacturing units. Today, the company operates from an over 65,000 sq ft factory in Sachin (Gujrat). The unit employs over 900 workers, 10 designers and manufactured over 175,000 pieces of jewellery using approximately 310,000 carats of diamonds last year. Another design team is based in New York. Kiran is now one of the top five jewellery vendors in the USA and is among the preferred suppliers for major jewellery retailers like Sterling, Zales, J.C. Penney, Fred Meyers and others.

Besides, the US, UAE, Hong Kong and India are other important markets, though clients are also spread across diverse countries like Thailand, Australia, Japan, Taiwan, Malaysia, Switzerland, Italy and UK.

Babubhai Lakhani, who heads the jewellery division says that the recent Unity collection, designed to give the effect of a single large stone by precision setting under a microscope of one full-cut solitaire (0.20 carats–0.90 carats) surrounded by smaller single-cuts, has been extremely successful. “It gives a perceived value of 2.5 times of the actual diamond weight based on an equivalent round stone, at 1/5th to1/6th of the cost,” he explains and is available at over 1500 retail points across the world.

Recently, Kiran has opened a new jewellery manufacturing unit in Mumbai, to cater to the domestic market. The factory is spread over 15,000 sq ft and has a work force of 300.

The Larger Canvas

The manufacturing set up is supported by an extensive marketing network of offices at prime business locations in key markets – Kiran Exports Hong Kong for the Far East, Kiran Exports BVBA in Antwerp, Kiran Jewels LLC in the Middle-East and Kiran Jewels, Inc. for the American market.

With such an impressive set-up, it comes as no surprise to learn that Kiran has received numerous export awards from The Gem & Jewellery Export Promotion Council for the last many years, in both the loose diamonds and jewellery categories, and its Belgian arm has been rated the largest importer from India in Europe.

In all this, the social angle has not been ignored; in fact CSR has been ingrained into the company’s philosophy from its very inception. Educational and medical activities have been given pride of place and over the years the company has set up a primary school & computer center at the M.D Lakhani Girls School in Gujarat. Regular blood donation camps are also conducted, and a large donation has been made for the construction of a world class hospital in Surat. The company also has contributed towards activities of NGOs in various fields having donated a few million dollars to a variety of causes.

What lies ahead for a company that has already achieved so much? Patel mentions expansion in China through the new offices in Shanghai and Shenzhen as well as further increases in the manufacturing and office set ups.

Kiran has recently opened a 12, 000 sq ft head office in Bharat Diamond Bourse, which houses more than 100 professionals across all major functions such as sales and marketing, finance, IT, human resources and administration, as well as a dedicated modern assortment facility with 350 trained assorters just adjacent to the Bourse. A new 400,000 sq ft factory with sophisticated technology is also under construction.

The company’s Antwerp arm has recently been certified by the Responsible Jewellery Council (RJC) as meeting the ethical, human rights, social and environmental standards established by that body.

And technology continues to be at the core of the future. Says Vallabbhai, “Though 448 Sarin systems may seem quite a lot, we are going to have 500 shortly and even 1,000 over time.”