Thought catalyst: Enjoy the freedom to do whatever you please, responsibly!

Thought catalyst: Enjoy the freedom to do whatever you please, responsibly!

Enjoy the freedom to do whatever you please, responsibly!

Fun work way

I grew up through my adolescent years very much envious of the grown ups. 

While I had to suffer through parental controls at home, peer pressures at the play ground and the demands of the teachers at school, the elders seemed to have all the fun. 

They had no one to approve of what they wore, ate or did. 

I could not wait to grow up faster. 

Now that I am a grown up entity myself, the idea of fun continues to elude most of us.

Strangely, I find that the children have all the fun today while it is the elders that lament most about not having the freedom to do what they enjoy doing most. 

Ravi has a brilliant mind and is a wizard with numbers. 

At 28 , he is not sure whether he is better off starting a new venture in India or accepting a six figure salary with a US based insurance company that wants him to set up an actuarial practice. 

He finds both of them equally attractive and yet, equally risky. 

He has been postponing the inevitable for over 9 months now. 

Reason: He is not sure which of the two will be the right decision. 

Dharam runs a successful BPO. 

He has built up the company in ten short years into a 100 Million $ enterprise. 

He is a workaholic and keen to go for a Public issue and join the half a Billion $ league by 2015. 

He drove himself so hard that he has been through two by pass surgeries before he turned 35 last December. His family and doctors want him to slow down. 

Instead, his venture capital appointed partners want him to speed up. 

Suddenly all the fun has gone out and no one else wants to carry the ball. 

He feels all alone and is shy to admit his state of helplessness.

He is too overwhelmed to decide what he should do with himself for the rest of his life. 

Suket was a brilliant flight instructor with the Indian Air Force. 

He coveted a PVSM from the President of India before his retirement in 2010. 

Upon invitation from his schoolmate, he accepted the job as a HR head for the company. 

Things seemed to go well until last Christmas.

His friends company was bought over by a larger firm. 

The management has changed hands. 

He knows that the new management team is actively on the look out for a younger HR Head but have not told him about it yet. Suket needs the job because he cannot maintain his lifestyle on the pension from the Armed Forces. He is too embarrassed to admit his dependence on a steady job in the public.

More importantly, he is totally unused to Monster. com and Naukri.com.

How does one make a resume, float it on the net and face the interviews conducted by people less than half his age? He is also afraid of upsetting his wife who has just about managed to get comfortable with Civilian life. 

Suket wonders if he can hope to put the fun back into his life. 

In the strictest of confidence they ask: ‘Please, give me some candid advice.’

Can you help them?

Curtains

A garden does not become great, merely by sprinkling it with enriched seeds and left to be taken care of by itself. It is great gardeners that groom them into a beautiful feast for the eyes and a timeless treasure to behold, for the future generations to savor.

Likewise, without the inspiration, nurturance and the guidance of the board members, it is almost impossible to build great corporations. I was privileged to share twenty-five illuminating instances from my work life, that highlighted the insightful contributions the board members made to their shareholders and employees.

From some of the queries, criticisms and generous comments from readers like you, I drew the inspiration to carry on with my notes. I do hope, the contribution here, however humble it be, was found useful. As I draw this series to a close, I do hope you found parallels in your own organizations too. I do wish that these ideas stimulate your future as much as they did to me.I wish to thank you for your esteemed patronage.

I conclude this series with the fond hope that these columns would continue to be a source of inspiration and wealth aggregation for the times to come.

What qualities to look for in the next Chairman to be ?

What qualities to look for in the next Chairman to be ?

The 35 year old company had gown into several divisions and exported the products to over 98 countries. The current Chairman was nearing 70 and the board wanted a relatively younger team at the top to head the business. With Gen Y constituting the bulk of their consumers, now, it was important for the company to think young.

What should be the qualification criteria for the new management team to be ?

The company invited a seasoned expert from the field of management to address the potential contenders who numbered over 70. What should they look for in the 70 people to decide who to hand over the reins of the company to?

“ If you have a visionary amongst you, then this company will be most safe," began Dr. Patel. He had served on the boards of several Fortune 500 companies and has been an advisor to many a CEO on the art of grooming their successors. “ Let us identify the visionary amongst your aspirants and ascertain the traits do they demonstrate for leadership,” said he.

Foresight: First, do they see the future ahead of the others? Akio Morita, of Sony created the phenomenon of Walkman that revolutionized the Music industry. Eiji Toyoda of Toyota created the luxury of a Mercedes Benz at half the price - Lexus went on to become a legend. Before laying down the office of the Chairman, Soichiro Honda wanted the world’s cleanest car, HONDA CIVIC to be created. Jeff Immelt at GE believed in reducing the energy demanded by airplanes, ships, railroad engines and power plants to 40% what they were consuming then. The consulting house of McKinsey believed in working like a single large family of business they called ‘One firm firm’ with knowledge as being the only differentiator of seniority in the company. The head of Royal Dutch Shell, Arie De Guys, believed in creating everlasting corporation that invented the way it learnt daily.

In India we have Kalaam, the missile man, Kurien, the father of White (milk) revolution, Thomas Thomas, who invented the use of non edible oils to make soap so that millions of kitchens could get an uninterrupted supply of cooking oils. MS Swaminathan helped self sufficiency in food by revolutionizing the way rice is cultivated . Quietly, Rajendra Pawar promoted computer literacy through NIIT and Janak Mehta introduced the TQM Revolution through CII way back in 1988.

All of them had the gift of seeing 20 years and beyond. Does your top team have the power of prophesy, the ability to look beyond? Does your CEO possess it?

Vision: Second, do they believe in something as a core message that needed to be reflected uniquely in every aspect of the offerings of the company, like the corporate signature. For Sony, it was the respect for nature (Mottainai- in Japanese)and miniaturization; everything had to get personalized and pocket sized! For Toyota their ability to grow the pie of the car market by making them cheaper and better was more important than fighting for market share. Environmental friendliness was the theme for Honda. Energy saving in every aspect of life is GE’s motto. Superior thinking was the motto for McKinsey. Corporate longevity was the theme for all of them; they continue to be in the top of Fortune 500 even today and have become timeless legacies for their investors.

The scientific temper promoted by Kalaam is as timeless as the success of cooperative movement among milk producers for Kurien. Indigenous R&D for Thomas was as significant as putting the nation through computer literacy and modern methods of production and management for Pawar and Mehta respectively.

All of them, not only dreamt big but were far ahead of their times. They placed an abiding faith in the power of India to renew itself and gave it one key ingredient to success; they sowed the seed and tended the garden for it to flower and flourish for generations thereafter. Does your CEO have such a message?

Staying power: Whenever any new idea comes, do people like it? No way. There is always entrenched resistance. Yet these people had the singular ability to appeal to the imagination and ignited the passions of the entire generation; inspired them to take on the hardship of change. They took on their successes and failures with the same level of ease as they endeared themselves to their friends and treated their enemies with respect. Charming their way through a crisis that was legitimate, they engaged the mind and spirit of the people to respond to a call to action that was very significant. Does your CEO to be demonstrate such a staying power?

I think as a senior team you will be failing your shareholders if you do not clearly communicate what you are looking for in the next CEO. So communicate first and get all the 70 of them contest of this position openly and fairly. Let each one of them paint a scenario for the future that we are would love to envision and hear about. Let them identify the message that will take us there. May they also demonstrate their tolerance for those who are unable to appreciate the future, by demonstrating the will to carry them along, without denigrating or dispensing with them.

If we found such a person, the current team would have discharged their debt of gratitude to the trust placed on them by the shareholders. Thank you.”

Dr,. Patel sat down having satisfactorily seeded his message for one more time in his illustrious life.

Shekarsan

Revenue scoping policy

Revenue scoping policy

The press were waiting for the press note on the annual business performance to be released. The release of the press note was delayed because the board had not yet approved of it. The board could not approve of it because the auditors had yet to sign off the balance sheet. The auditors will not sign off the balance sheet because the CFO was still to provide satisfactory clarifications they had sought earlier from the company. Whereas the press was to have got the note at 1100 hrs in the morning, they got it at 6 p.m. after a harrowing wait of over seven hours.

Ravi Ratnakar, Director appointed by the institutional investors was visibly irritated at having to cancel his flight for the night and go the next day morning . He pulled the CEO aside and told him that financial results must be published to him by the 3rd of every Quarter ending month. A delay of 20 days and doing it on the morning of the board meeting was simply not acceptable. The CEO, as if he had nothing to do in the matter, pointed to the CFO and asked the latter to get his act together.

The CEO and the CFO both knew what the problem was but were unwilling to face up to it. They both blamed it on the failure of the quality of the accounting Software that made the consolidation of quarterly accounts very difficult. Ravi Ratnakar was not prepared to be taken so lightly. Upon his return home, he called up the CEO and told him that an auditor friend of his will help them in the matter. Helplessly, the CEO was forced to accept the offer without protest.

Next quarterly board meeting passed off peacefully without any problem. The auditor had very little to do because the CFO, keen to avoid getting exposed, had already managed to address all the problems. How did he mange it this time?

Delay in release of invoices on customers: Usually, in order to show good revenues, the books were kept open for a week after the month got over. Consequently, the generation of invoices too were postponed by as much, flowing into the next quarter as receivables. The is time, it was closed promptly on the last working day. This, quite obviously improved the working capital situation but went down poorly with the customers who were denied the extra time to enjoy free credit.

Doubtful debts not recognized: The collections team likewise, was often given time well past the start of the next quarter to show that the status of accounts receivables were in very good shape. That once again was not allowed owing to the timely closure of the bank books. The amounts outstanding beyond 180 days were clearly highlighted as doubtful debts; each one had a clear status note explaining whether they will become delinquent and if they did, how they will be dealt with.

Delayed release of credit notes: Errors in invoicing and the issue of credit notes for goods returned back unsold was often kept pending. While it looked good artificially in the short term, by the end of the year it reflected poorly on the results of the last quarter. This too was remedied forthwith.

Adjustment of advances: Although the issue of travel advance and timely settlement was a mandated policy guideline, employees had the habit of submitting travel expense statements very late. With over 40 % of the employees traveling for as much as 100 days overseas, the amount shown under loans and advances was inordinately high. Worse yet was that much of it remained under suspense until the true levels of expenses became known much later on. In most cases, the employees had spent in excess of the amounts advanced, reflecting poorly on the cost of operations.

Surprise expenses incurred without prior approval: Although there was a strict guideline on discretionary spending towards unbudgeted expenses, every month, a substantial amount was incurred and justified post facto as a fait accompli. There was very little for the CFO to do except to accept the expense under protest.

Posting delays: All these factors resulted in inordinate delays that allowed very little time for the MIS department to post the vouchers into the system. When the automated MIS system released the provisional reports, there were obvious and glaring omissions and errors that required correction and reprocessing before the accounts could be clearly squared off.

The results of the next quarter were poor. But Ravi Ratnakar knew why. He was happy that his timely threat had resulted in a one time poor show; since all the accumulated problems of bookkeeping disciplines had been addressed, he was not unduly worried. Now that people had owned up to the bad news, he was confident that they will act more responsibly in the future.

Shekarsan

The hard side of addressing the soft issues

The hard task of addressing the soft issues

Everybody in the board loved Chandrasekhar. He carried himself with grace and was deeply human in the way he came across to people. He seemed unhurried despite his busy schedule and was always approachable. The CEO Ravichandran had assembled a team of great of experts who were quick to address technical challenges and redress customer complaints with remarkable ease. However, the workplace was very machine like and lacked any energy or enthusiasm. Where could he be going wrong? He valued the difficulty of keeping people motivated and was anxious not to allow the enthusiasm of the youthfully capable team to come down for any reason.

Chandrasehkar listened for a while.

He asked the CEO if he could be permitted to walk about all alone, unescorted by the senior managers, across the shop floor and the offices of the middle management? The CEO saw no reason to object and let it happen.

Chandrasekhar went about in his natural style shaking hands, meeting a cross section of the people enquiring them about their welfare and work. He apologized for dropping unannounced and took permission from people if it was all right for him to talk while they worked. In some cases, he waited until the operators and staff finished their work and got free to talk to them. He graciously accepted the insipid tea and soft biscuits that were offered to him and demonstrated enjoying it with great relish. After touring the workplace for almost three hours, he returned to the CEO’s room for lunch.

The CEO expected Chndrasekhar to say something about the mission he had undertaken in the morning but the discussion seemed to include everything but the topic that was far too dear to the CEO. That after noon Chandrasehkar asked for the services of the CEO’s secretary and dictated a brief note on his findings.

What junior employees wanted their senior to do:

1. State expectations clearly: Bosses are often vague about what they want and often fore away instructions to juniors without telling them the significance of the task they are being asked to undertake.
2. Be reasonable; do not expect miracles: Target are set so high that the seniors manage to raise the blood pressure and anxiety levels rather than the enthusiasm to exceed expectations.
3. Give us decisions with the same speed you want to get results: Avoid creating interruptions to work by delaying decisions making them wait in suspense.
4. Find the time to ask me how I am doing instead of pouncing on me in the last minute: Managers vanish from the scene indefinitely into meetings only to appear at the last minute and create excessive rework for them.
5. Do not set me up to fail or knowingly let me down: Sometimes they wonder if the boss is really their friend and would like to see them succeed.
6. Be honest: If yo do not trust me, say so: some of them believe their bosses merely suffer and tolerate them.
7. Don’t lie; we are intelligent enough to make out: This is self explanatory and erodes trust completely.
8. Shoot the messenger: “We are afraid to ‘bell the cat’ because we know we will be shouted at for brining, not creating, the bad news.”
9. Micromanaging: Sometimes, the boss better leave us to ourselves and not be hanging around waiting anxiously for us to complete the work.

What the senior managers expected the junior employees to do:

1. Inability to say “No”: Say ‘No’ if you mean NO. Don’t say ‘yes but’
2. Anxiety to please at all costs: Why do they say yes to everybody creating a lot of confusion?
3. Over commit and under deliver: Why be shy to admit what yo cannot instead of building an expectation and disappoint at a later stage.
4. Admit ignorance upfront: No doubts are raised when the instruction is given; all problems come up only when they sit down to execute; why not do some anticipatory thinking?
5. Withhold resources: Knowing full well they need resources, no one releases surplus and idling resources. People enjoy merely holding onto them.
6. I don’t know: Please do not pass your half baked opinion freely n every subject.
7. Allow problems to fester until it blows up: Let the boss find out culture has to go. Please should if there is ‘fire’
8. Safely stay in the middle: don’t be a middle of the roader and forever feel shy about taking sides.
9. Over communicate please, rather than holding back: If you do, err on the side of speaking more than not speaking at all.

When Ravichandran read it, he said, “This is fine; how do I implement it ?”

“Whenever bosses and juniors exhibit the right behavior, give them a chocolate. Count the number of wrappers at the end of each month to know how many of the positive behaviors they exhibited.

Measurements help change behavior.

Positive appreciation helps change happen faster.

It is easier to manage technology; the soft side of business is harder to walk on !”

Shekarsan

What is our intellectual horse power?

What is our intellectual horse power?

“Do we hire people in this company to think at all?” asked Raghu Parthasarathy who had assumed charge as the Chief Knowledge Officer. Raghu had returned to India after spending over 20 years in the US. He holds several patents and helps companies develop the capacity of the people to innovate and enhance the intellectual capital base.

He was making his observations known to the CEO and the board on why he is compelled to ask that question. He revealed some interesting statistics:

Against the 2.5% of the turnover the company was spending in R&D, it was ‘importing’ knowledge and outsourcing thinking that costed the company nearly 30% of the revenue! In other words for every one rupee spent on commercializing new ideas, the company was spending 12 times that borrowing it from elsewhere. Therefore the company’s ability to think, that he termed ‘intellectual horsepower’ was at mere 8.33% If the company was content to encourage so little thinking and do much shopping for ideas from external sources, why at all hire top flight engineers and MBA’s from Ivy schools at exorbitant starting salaries?

He reeled off examples:

The human resource department does very little thinking or even doing. They outsource everything from climate surveys, Employee satisfaction surveys, recruitment and selection of senior and junior personnel, annual compensation benchmarking, skill assessment for all new positions and even 60% of the training. The cumulative financial load of all these outsourced activities was equivalent to one month’s wage bill for the entire company, 20 crores! The HR department had become a buying agent of HR services. This does not include payroll processing and the HRIS platform under automation.

Marketing itself does very little thinking related to their function. Everything from creative advertising, to consumer research, brand equity assessment needed to be audited, analyzed and reported for market share gain and loss; all these were offloaded on to third party suppliers. All that Marketing did was to arrange them make presentations to the CEO and settle their bills. They gave away almost 30 crores of business in the previous year and felt the spending should go up higher! When will they learn to do these works in house?

The Director of Communication had appointed specialized agencies to bring out the company brochure, design the balance sheet, edit and print he monthly newsletter, convene all promotional events including press meets and the maintenance of the company’s Intranet. That cost another 24 crores; down the drain.

Information processing department outsourced all their data entry work and the related analytics to a specialize agency that is supposedly statistically more literate then us. No single agency within the company was capable of generating any special reports or analysis of our own.

Raghu parthasarathy highlighted the need for the company to institute a policy that will make the ‘import of thinking ‘abilities far more stringent. He went on to categorize knowledge work into five:

1. Internally developed proprietary know how: Ready made, tried and tested proven application
2. In house research and analysis: Confidential and tightly managed development program
3. Fully outsourced projects: Routine and cost effective to get done from the outside
4. Off the shelf bought out solution: Import ideas if they are it can be developed faster and better buy
5. Custom designed package development: What is needed to develop it in house?

The first and second should be actively encouraged.

The third and the fourth seriously debated.

The last one actively discouraged; it should either belong to the first two or the next two.

Else it will become prohibitively expensive to maintain and upgrade. .

Unless the estimated 80 crores on outsourced knowledge work is actively tracked and brought down, not only would the company be at a disadvantage, it will also affect the morale of the people who have to look up to outsiders for creative solutions. will that not be counter productive in the longer term?

Shekarsan