ORGANIZATION DESIGN PROJECT

Group 8:
Radhika Bhadada
Milind Gurav
Amoghavarsha L
Dasari Nikitha
Saurabh Shah
Soumika Sree

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 TABLE OF CONTENTS

S.No. Topic Page Number

1 About CleanMax Solar 3

2 Company’s Vision and Values 3

3 Industry Overview 4

4 Organization Strategy 7

5 Organization Structure (Before and After Funding) 9

6 Structural Dimensions 10

7 SWOT Analysis 10

8 Collaborators (Clients and Competitors) 11

9 Organization Culture 13

10 Challenges and Way forward 15

11 Annexures

(a) References and link to the video with Co-founder 16

(b) Questions to the Cofounder – Mr. Andrew Hines 17

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 ABOUT CLEANMAX SOLAR

CleanMax Solar is India’s largest provider of solar power to corporates. The company was
founded in 2011 with the mission of helping corporates Go Green and since then, CleanMax
Solar has successfully installed more than 250 projects for over 70 corporates, with a combined
on-site capacity of more than 100 MW. CleanMax Solar is the #1 rooftop solar developer in
India for the past three years, with a market share of 24 per cent (as per the Bridge to India
May 2017 report). CleanMax Solar also operates more 300 MW of solar farms in Karnataka
and Tamil Nadu, for supply to its corporate clients. CleanMax asks for no capital expenditure
by clients, provides a discount of 25%+ on price of electricity and simplifies solar by billing
monthly on actual solar power generated and consumed.
With clients spanning sectors such as Automobiles, Education, Pharmaceuticals, Food &
Beverages, and Information Technology, the company develops projects on a turnkey basis,
providing power on a per-kWh basis, under long-term Power Purchase Agreements, at rates
cheaper than prevailing grid tariffs. CleanMax Solar has been recognized by the Ministry of
New & Renewable Energy (Government of India) with National Excellence Awards for
Rooftop Solar Developer and Rooftop Solar EPC Player in 2016; and has won the National
Award for sustained excellence in solar energy by World CSR forum in 2017. CleanMax has
also been awarded the Best Rooftop Solar Player at the Renewable Energy Exposition (REI)
2017. The company started off with 2 people Mr. Kuldeep Jain and Mr. Andrew Hines as the
founding members and were joined by a third cofounder Sushant Arora.

ORGANIZATION VISION AND CORE VALUES

CleanMax began as a Gas-Coal generation company in 2010 but had to eventually shut down
because of external uncertainties. No sooner in 2011, it pivoted to the Solar Energy Sector and
ever since has been performing exceptionally well and continuously evolving as an
organization, which makes it a very interesting project to study.

As per Mr. Kuldeep Jain, Co-founder & MD, CleanMax Solar is committed in following three
key values:
• Persistence – CleanMax believes in staying true to its strategy and ways of doing business
even when many say it won’t work.
• Passion – CleanMax has a strong belief in the change impact that the company creates in
the external world and staying true to that.
• People – With a people centric approach, it pays the highest respect to its clients, employees
and the investors who believe in companies’ journey.
And he entails that, it was these values which were responsible for the revival of the company
after the downfall in 2010 and has enabled them to further continue their growth.

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 INDUSTRY OVERVIEW

India has a power generation capacity of 327 GW as per the Ministry of New and Renewable
energy and currently, conventional energy sources like Coal and Natural Gas have a lion’s
share. Solar energy production in India makes up for about 4% of entire power generation.

Now the question arises that how is this relevant in the present scheme of things. The answer
lies in the policies of the economy. Government of India (GoI) has made a commitment to itself
and its global partners to produce clean and sustainable forms of energy. To realize the same,
it has set very ambitious plans to grow exponentially the solar sector in India. GoI has set a
target of 200 GW of total renewable energy by 2022, of which solar energy will contribute 135
GW and rooftop solar (in which CleanMax operates) will contribute around 40GW, or about 5
billion USD.

GoI has provided policy assistance through subsidies and accelerated depreciation programs [1]
and the industry has truly boomed with such assistance. In the past 5 years, the compounded
annual growth rate (CAGR) for solar energy sector in India is 117%. The installations in the
country tripled in the year 2017, indicating the potential of the solar energy sector in India.

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 Externalities that will assist the development of solar energy sector

Government of India has set a mission of adding 100 GW of solar power capacity to the nation's
power production capabilities by 2022 [2]. It is driving this goal through a set of incentives and
mission to allow the consumers and large corporations to adopt solar power.
India had a 10 MW of installed solar capacity in 2010 and by 2014 it had reached a level of
3063 MW; this exponential growth is making the government look towards solar power as a
sustainable alternative to non-renewable sources of energy. The ever changing policies gives
the industry a very complex and unstable environment to operate in.

The following are the steps taken by the government to increase solar power footprint in India.

1. Incentives for the organization in the form of tax exemption

For an organization which has significant profits and is an income tax payee can avail an
accelerated depreciation on set up costs. An accelerated depreciation up to 80% can be availed
by the corporations under the Income tax act for rooftop solar systems.

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 2. Subsidies and financial assistance

Subsidies and financial aid are being provided through Ministry of New & Renewable energy
(MNRE) for the residential sector. Individuals can avail these subsidies to have a significant
return on investment in the short run as well as long run. The following table provides the
savings through subsidies and accelerated depreciation by installing a solar rooftop plant.

3. Renewable energy certificates (REC)

Some of the large power generation corporations are required to procure a specific proportion
of their power requirements through renewable energy. This is calculated through Renewable
Energy Credits (RECs). Mathematically, 1 REC = 1 MWh. Each corporation is required to
produce a pre-specified number of RECs. Having a rooftop solar plant helps corporations meet
their REC requirements.

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 ORGANISATION STRATEGY

CleanMax became one of the top players in rooftop solar sector within a short span of time. Its
success is attributed to the strategies it follows as an organization to meet its goals. Let’s
evaluate various strategies.

Porter’s Competitive Strategy

According to Michael E. Porter, an organization can take two approaches namely

differentiation or low-cost strategy to compete in the market. Differentiation strategy involves
investing in innovative products and unique services to yield high profits. Low-cost strategy,
on the other hand, involves selling not so unique products at very cheaper rates to tackle the
competitors.

CleanMax follows differentiation strategy to compete with other solar solution providers. The
organization believes in providing customized products to clients. They have an experienced
in-house engineering team which customizes the power solution according to the space and
demand of the client. For instance, in Pune, they set up a 3.75MWp plant which is a mixture
of rooftop and ground mount solar installations depending on the terrain.

Miles and Snow’s Strategy Topology

Raymond Miles and Charles Snow developed a strategy for organizations to tackle the external
environmental factors. The four strategies are prospector, defender, analyzer and reactor.
Prospector strategy is to be innovative with changing environment. Defender strategy is to
provide high quality products and services for existing customers. Strategies of analyzer lies
between that of prospector and defender. Whereas reactor strategy is to just respond to the
changes according to the needs.

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CleanMax follows prospector strategy because it provides solar solutions which is still an
emerging sector in India. It leads the market with its cutting-edge solution. The other players
in the market try to follow what CleanMax does and set it up as a benchmark. CleanMax keeps
optimizing the solutions to provide high quality and more power yielding sources for its clients.
With more than 250 successful projects in hand, CleanMax is continuously improving to meet
the specific requirements of the clients.

Effectiveness Approaches
Effectiveness of an organization can be measured in terms of the utilization of inputs to get the
desired outputs to meet the objectives and goals of the company. Four approaches of the
measure are goal-based, resource-based, internal process and strategic constituents.

If we look at CleanMax’ strategies and the way it operates, it is evident that its effectives can
be measured by the goal-based approach. Clients have mentioned that CleanMax starts a
project within one week of finalizing the contract. They are also appreciated for completing the
projects much before than the stated time of completion. They not only excel in completing a
project faster but also in providing quality maintenance services post installation.

OPEX Model – Key to success

Success of the firm is attributed to the business strategy developed by the company, called
“Opex model”.

OPEX model is zero investment hassle-free model, aiming to make the decision of switching
to solar power very easy for companies. There is no investment from client’s side and clients
enjoy the benefits of saving on their power costs. This model is risk-free as the client pays only
as per what they have consumed. It is hassle-free as the maintenance is less and CleanMax
provides complete assistance. In the beginning, corporates employed this model to meet very
small percentages of power requirement. Seeing the tremendous reduction in operating costs
and savings by adopting this model, many clients are driven to replace traditional sources of
energy by solar solutions.

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 ORGANIZATION STRUCTURE (BEFORE FUNDING)

To understand the organization structure, we evaluated the organizational paradigm of whether

it fits under the broader definition of mechanistic or organic. In its early days, CleanMax
followed a lean structure with a three-tier hierarchical level. The respective teams were
responsible for recruiting for themselves. There were no separate verticals for process-driven
roles like marketing, HR & IT. This was because as a B2B firm, it followed a very informal
style of work. Employee roles were not restricted to specific jobs. Employees performed a
range of non-routine tasks, which meant the span of control was low. As it was operating in a
highly complex and varying environment which was uncertain to say the least, the degree of
uncertainty was very high and horizontal communication among employees was extremely
important.

ORGANIZATION STRUCTURE (AFTER FUNDING)

As the company grew with increased business and prospective clients, it identified a need for
diversification of the various departments it had. As recently as 2017, it got a funding of about
$100 Million by Warburg Pincus and The World Bank and underwent an organization structure
revamp. The company decided to pursue overseas operations by opening offices in UAE and
Thailand, even though they are being administered and controlled by the Indian offices. It has
taken a multidomestic approach for its business operations so far. And to cater to this demand
of specific needs, it has now added the specific process-driven roles. Because of this, the firm
falls under the formalisation stage of the organization life cycle.

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 STRUCTURAL DIMENSIONS

We can broadly classify the organization structure of CleanMax in four sections as follows:

1. Formalization: CleanMax has a low degree of formalization and enjoys high inter-
departmental horizontal communication because of the external factors uncertainties.
Presently very less documentation is required with some level of process-driven tasks
performed.

2. Specialization: Employees in general are not required to be specialists of any sort. In fact,
CleanMax urges that recruited employees may not have any sort of specialization as the
industry itself is quite nascent and encourages people to pick up different skills to better
manage the situation as needed. They hire people and train them smart to meet different
business needs.

3. Centralization: The company has three-tier hierarchical level and is decentralized.

Individual managers have authority to take decisions independently. Employee roles are
oriented towards company goals and thus their actions play wide role in determining
company’s performance.

4. Hierarchy of Authority: As employees are not restricted to specific role-based tasks, they
perform a range of non-routine tasks and the span of control is low. The company has a
very lean organization structure and the structure is mainly driven by the strategy of the
company.

SWOT ANALYSIS

Strengths- CleanMax is a market leader in rooftop segment with 24% market share [3].
CleanMax capitalized its first mover advantage. One of the strengths, where CleanMax is far
ahead of others, is its operations and resource management, leading to on-time completion of
installation. It is backed-by very strong investor names such as Warburg Pincus and World
Bank [4].

Weaknesses– One of the areas of concern for CleanMax is that they are not providing solutions
for residential market because of economic viability. Many small firms show a lack of interest
because the government is not providing any subsidy for commercial or industrial users. The
company has a poor presence in the north-eastern region of the country.

Opportunities– CleanMax started its overseas expansion in the Middle East, which is a
growing market for solar energy. The increasing demand for solar energy in India is the positive

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sign for CleanMax to continue its operations with high capital investment. China’s
overproduction decreases global price of solar panel, ultimately increased profit margin for the
firm [5].

Threats– Solar energy is a technology-dependent industry, one breakthrough can deter the
progress of any company in the solar sector. Due to high push by the government, many firms
have starting operating in the industry, increasing competitiveness and fragmentation in the
market. This poses a huge threat to the company. Also, if the government changes and revises
the policy (say imposition of safeguard duty on the solar panels [6] which comes from China),
it could lead to an increase in the cost of the solar system.

Competitors

1. Cleantech Solar [7]- Cleantech Solar is a solar developer that finances, constructs, owns and
operates solar projects similar to CleanMax. Its headquarters are in Singapore and operates
across pan-Asia, focusing on long-term investments within the commercial and industrial
customer segments. In India, it delivered services to Apollo Tyres, MJ logistics, Sangam textile
and many more and penetrating the Indian market at a fast pace.

2. Amplus Solar [8]- Amplus Solar is one of the leaders in distributed solar energy solutions
catering to industrial and commercial clients across different sectors. It started in 2013 in
Gurugram and has successfully completed projects of Indian heavyweight like Indian
Railways, L&T, TVS, HAL and Whirlpool.

3. Renew Power [9]- Renew Power operates in the solar as well as wind energy sector. It is
India’s largest private renewable energy provider. It started operations of solar in 2013 and has
a strong presence in western and southern India.

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4. Fourth partner [10]- It was founded in 2010 and has a pan-India presence. It has partnered
with the government on several projects in Railways, Airports, NTPC and the Smart City
Mission. It also commissioned the projects for Ferrero, Neihoff, Schneider Electric, Axis Bank,
Honeywell, Airtel, Britania, Nestle and many more. It has more than 100 clients.

Clients

CleanMax provides services across all the sectors. Following is a glimpse of clients, which
have benefited from CleanMax’ energy solutions.

Education Automotive IT & Food & Beverages Utility Services

Pharmaceuticals

NIT Tata Motors Mindtree Limited United Breweries Karnataka Solar

Surathkal Limited farm

IIT-BHU Konecranes Alkem Laboratories Carlsberg, Alwar Tamil Nadu

Limited Solar farm

Pune NBC, Newai Nestle India Kempegowda

University International
Airport

Manipal Mahindra Chennai Metro

University Group

With this wide variety of clients, CleanMax is truly a national player. It enjoys economies of
scale and goes an extra mile to meet client requirements [11].

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 ORGANIZATION CULTURE

Culture plays the main role as the driver of growth in the company. Since the external
environment is rapidly changing, CleanMax follows a mix of adaptability and clan culture to
focus on the satisfaction of its employees.

Adaptability culture:
● CleanMax doesn’t concentrate on specialisation of employees and hires young people
and trains them smart so that they will be receptive and flexible towards the changes in
external environment.
● Since CleanMax operates in a B2B environment, the client requirements change
rapidly, and the employees should be skilled adequately to meet those requirements.
Clan culture:
● All the employees are treated equally and given ample opportunity for innovation and
ownership.
● Employees are encouraged to change verticals to help them develop a holistic
personality and explore different opportunities.
● All the departments work as one single team towards the company’s goals.

Culture can be further interpreted using the following parameters:

Structure:
CleanMax has an organic and flat hierarchical structure so that the employees have the
authority to make decisions and take ownership. The structure is also very client focused which
helps them adapt the rapid environmental changes.

Symbols:

“Rise together and fall together” is a strategy that

CleanMax follows to treat all the employees
equally. The company follows a no cabin policy
to promote the belief that there is no
discrimination among the employees.

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Control Systems:
CleanMax follows a boundary control system where it only tells the employs what not to do
and gives freedom to explore and innovate within those boundaries. They have flexible timing
system without any restrictions of in and out time. CleanMax employed a CRM software to
lead and manage their clients in an efficient manner.

Rites & Ceremonies:

A one-week training program for the new employees enables CleanMax to spread the culture
and values to the joiners. They have an onboarding party for every new employee to make the
employee comfortable with the organization. The HR managers specifically introduces the
person to every person in the company to ‘break-the-ice’.

Stories & Myths:

The new employees are told past stories to motivate them. One of such stories is about an
employee who visited client on a wheelchair despite having stitches on her feet. This shows
the level of commitment employees have towards the firm.

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 Challenges and Way Forward

CleanMax faces the following challenges in its journey ahead:

● Start-up to Formalization: Since the organization is slowly moving from start-up to a

formalized structure, the employees are facing challenges in terms of adapting to the
new culture and rules.

● Task interdependence: The firm has a sequential interdependence among the verticals
and hence conflicts arise sometimes regarding the efficiency of the deliverable from a
specific vertical.

● Resource sharing: Engineering is a shared resource for all the sales teams of north,
west and south regions. So, conflicts arise when one of the sales team is given priority
over the others.

● Market differences in international expansion: With the international expansion in

Dubai and Thailand, CleanMax initially thought that it would send employees from
India. But the business in these regions is heavily driven by the local culture and barriers
such as language. So, the company may need to start thinking about hiring local
employees for these offices. Also, the market in Dubai and Thailand are back in time
compared to India which is a challenge for CleanMax in terms of the technology and
skills employed.

If CleanMax proactively takes steps to conquer the mentioned challenges, the company has a
bright future ahead.

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 Annexures

References

1. http://www.eai.in/ref/ae/sol/rooftop/policies_regulations
2. http://www.nortonrosefulbright.com/knowledge/publications/127886/solar-power-in-
india
3. https://cleanmaxsolar.com/
4. https://www.livemint.com/Companies/BUMK76zifRKQuWDECNuzLI/CleanMax-
Solar-plans-to-raise-100-million.html
5. https://qz.com/india/1298585/chinas-solar-power-slowdown-is-great-news-for-india/
6. https://qz.com/india/1344287/india-has-imposed-a-25-safeguard-duty-on-imported-
solar-cells/
7. https://cleantechsolar.com/who-we-are/about-cleantech-solar/
8. https://amplussolar.com/
9. https://renewpower.in/
10. http://www.fourthpartner.co/
11. https://cleanmaxsolar.com/why-cleanmax-solar/

Link to the video taken with the Co-founder, Mr. Andrew Hines

Fireside chat with Mr. Andrew Hines, Cofounder

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 Questions asked to Mr. Andrew Hines, Cofounder

Andrew has worked previously with Suzlon and BP Alternative Energy. He holds MBA from
the University of Pennsylvania (The Wharton School) specialising in Strategic Management.

Culture:
1. How do you think culture affects the revenue and sustainability of your company?
2. What is the current culture? What are its advantages?
3. What is the mission of the company and how does culture help in achieving that?
4. Is it helpful in being flexible with the rapidly changing environment?
5. What are the challenges that the company is facing due to the current culture?
6. Can the company scale with the current culture? If not, what changes do you think
should be made?
7. How often are values and internal environment of the company discussed with the
employees?
8. What is the importance given to check the cultural fit during recruitment?

Competitors:
1. Who are your largest competitors in the market?
2. What strategies you follow to survive the competition? What amendments you made in
the organization to survive competitors?
3. Innovation is the key to be in par with competitors. Can you state few future innovations
of CleanMax? How did you align organization accordingly?

External Environment
1. What is your company’s plan for small household (rooftop area <1000 sq. feet)? Are
they not profitable for your company? Or is market size so small?
2. What is your future plan to compete with existing competitors or new entrants on the
basis of price?
3. What is your opinion on target 40 GW in 2022 by government of India? Is it feasible
for solar industry as whole from current position?
4. How goods and services tax (GST) affect the solar energy sector? Was it beneficial or
detrimental to the efforts of CleanMax Solar and other rooftop solar panel players?
5. How much of an impact does it make that government is giving subsidies and tax
exemptions for organizations that adopt rooftop solar plants?
6. Are companies struggling to get permissions for having a rooftop solar plant?
7. What are the major hurdles that an organization faces while setting up solar energy
operations in India?
8. How is CleanMax Solar being instrumental in helping MNRE help achieve its vision
and target of adding 100 GW of solar energy by 2022?
9. Despite falling costs and record low prices for solar energy, why is it still not a rising
phenomenon in our country? When the solar energy ‘revolution’ will take place here?

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