Two of industries’ top leaders talk on achieving managerial excellence and changing leadership in changing times.
Ways to Achieve Managerial Excellence
Mr Shenu Agarwal, MD & CEO, Ashok Leyland
Five or six points are very important for any manager or a leader: clarity of purpose, clarity of path, clarity of role on one side and then getting ready for the job, managing time, and connecting with the people. In the management world, we play the role of a soldier or that of a general. As a general, we have to see ahead of time, predict situations and tell our troops how to deal with those situations.
Clarity of purpose, mission, goal, task or whatever we want to get done is requirement number one. A lot of times, I see that a manager’s vision is something and the action on the ground is entirely different. When that happens, it is very hard to get magical results. If there is something wrong happening in the work environment and it is getting repeated, it is not the mistake of a lower level manager but that of a senior level manager. Probably the manager has not taken enough time or effort to clarify the purpose or mission or the goal. The manager or leader must clarify the purpose again and again and only then the desired results will come.
The second most important point is the clarity of path. Generally speaking, there are two types of managers in the management world. One is the specialists and the other is generalists. We must be clear if we want to become a specialist or a generalist. The world needs both in probably equal measure, but a lot of people make a mistake in the corporate world. They just can’t decide if they want to go deep or wide. Their career path depends on this particular attribute.
I am a generalist and it suits me. If you want to become a specialist, you must work with the best, so you can become the best in a particular field. If you want to become a generalist, it is not so important to work with the best. But it is more important to try different challenges and do different things. I started my career as a graduate engineer trainee. I got into technical services—a field job, then moved into sales after four or five years and later to international business. Some of these, I did intentionally and some of these just happened to me. But I was very fortunate to work in two very different areas. To become a generalist, you must have a wider perspective about the business. Managers must identify specialists and generalists in their team, depending on their capability and also choose their own paths.
Three Things Managers Must Do
There are only three kinds of things we do as managers or leaders. We do daily work—the routine jobs. Visiting a customer, making a pitch and coming back is a routine job for a salesperson. The other part is improvement and the third is breakthrough. All three are important. Breakthrough is like disrupting something that has been happening the way it has been happening for years and doing it very differently.
I have 30 years of experience in the corporate world. I see a lot of top managers doing routine jobs—not just 10% or 20% but much more than that, engaging themselves in routine jobs and doing firefighting because that is the way they have learned, growing up from the bottom. When you excel at doing routine jobs, you think that is how you should always be. You must have heard of a thing called midlife crisis or mid-career crisis and this is what that crisis is.
In a junior management role, 80% of your time goes in routine jobs. As a middle management person, probably only 50% should go into routine jobs and as a top manager or a leader of an organization, function or department, only 20% of your time should go into routine jobs. This clarity of role of who I am, what and where I am supposed to devote my time and effort is very important. A great area sales manager can sometimes become the poorest or the weakest zonal sales manager. You will see this all the time, because people just don’t realize that they have to do different things when they grow.
Focus on Mind, Body and Soul
Getting ready for a task requires acquiring the right skill and right competency. Most organizations or most of the HR people focus only on one part of the manager—which is the mind and its learning. They don’t focus on the body and the soul. Spiritual gurus will always tell you that you cannot be successful until the mind, body and soul are all trained and developed together over time. I see very little emphasis, at least in the corporate world, on training the body and even lesser emphasis on training the soul.
Work-life balance is a big issue in the corporate world. I have found a very simple method to tackle this. You have both external and internal customers. You also have tools and technology. I have observed a lot of successful people very closely and talked to them a lot. They spend most of their time either with customers and / or technology and spend the least amount of time in administrative jobs.
As a leader, I have to attend quarterly board meetings. It like takes me two days in a quarter. I don’t think that adds so much value to my life or career. So the best way to handle that is to schedule them. Normally, what I have learned to do is at the beginning of the year, I ask my office to set up my calendar for the entire year for my administrative tasks. The rest of the time is now available to focus on customer and technology. I have spent a lot of time travelling outside with customers, with other stakeholders and with our engineers in our R&D Center. We have to connect with them at a certain level, in a certain way and align them to one goal and one thinking so that we can work together and achieve something big.
Emphasis on EQ
In organizations, there is a lot of emphasis on intelligence. Intelligence is very important, but in most of the situations, intelligence alone does not work. There is very little emphasis on emotional quotient. We hardly talk about this and we are very shy in talking about these things. I have been involved in some major decision makings for years. At least 80% of the decisions are not made with logic but with emotional intelligence. By building a team together that connects each other, that looks at the problem in the same way, that works together to find a solution and that helps each other find a path is more important than just applying mind to a particular problem.
Personal Excellence
Managerial excellence is nothing but personal excellence in a lot many ways. Only people who are personally excellent can be managerially excellent. If you have lots of issues personally, it is very difficult to excel in some other environment, because you are you. To be personally excellent is to be internally very secure. If you have a lot of insecurity inside, you are not going to be an excellent human being. You will do a lot of mistakes and your mind will be in chaos all the time. So inside, you have to be much secured.
Of course, security means different things for different people. But there is one common theme that gives security to all of us and which is simplicity. We must live a simple life, which has less needs. Acquiring wealth and living a simple life are two different things. When your expectations are less and when you know that you can survive even with less means, you will be very secure inside. It’s not about how much wealth you have or do not have but it is about simplicity. Even very rich people who have accomplished a lot are not secure inside.
Changing Leadership in Changing Times
Mr Shrinivas V Dempo,
President-AIMA & Chairman, Dempo Group of Companies
Unlike Mr. Shenu Agarwal, I’m not a professional, though I’ve tried to get as much education as possible. I am a family person, from the third generation of the family who runs businesses and manages the challenges and also the opportunities that are phenomenal in our country.
In one way, we are connected to the whole world. In the other way, India is an outlier in many senses. You must have seen the body language in the US Congress House when our Honourable Prime Minister spoke there. It’s not that they just want to make friendship with us for no reason. They know that India is a powerhouse and will give their businesses an opportunity to expand their wealth and market cap. India is no longer ignored. That’s a great news for us that we all have an opportunity to prove ourselves and to contribute to the country’s GDP.
The VUCA World
But you must also realize that increasingly, the world is getting into VUCA. We have volatility, uncertainty, complexity and ambiguity. That makes the life of a leader, all the more challenging. But there are solutions to all these and the solution is to change your mindset, while keeping all the basics like clarity of purpose, clarity of role, human interaction and vision building intact. These will never change at any point of time.
But a leader today has to react differently in different situations. It’s no longer ‘His Lordship’ type of approach in the company. You have to believe in shared leadership and must take your people with you. Today, the lines of hierarchy are slowly disappearing. Whether it’s work timings or hybrid models, Covid has taught us a lot of things. When complexity as well as opportunities are increasing, how should a leader behave and react?
Stay With Your Vision
You must never fail to recognize your vision. I’ll give you an example of what happened to us. Our core business about 10-15 years back was iron ore mining. We were one of the oldest families in Goa, which did iron ore mining. It started from my grandfather’s times. We had long term contracts with Japanese steel mills such as Nippon Steel, JFE and all the top leaders of the world. We did this business very sustainably and very respectfully for a very long time.
Suddenly, China changed the rules of the game. What was $30 became $130. What it also meant was it challenged our values and morals, as there were competitors coming in overnight. They were bypassing all the rules and regulations. They said that if your cost of ore is $20 and you can sell it for $130, then go for it. They abolished all the long term contracts, went to China and sold in the spot market. I was increasingly challenged by this. I had a dilemma, whether to rake in the money the way that all others were doing or if I should be different from them and others.
I said, “No. I will stick to my long term contracts and my core business. Even if I make only $5 a ton instead of $105 a ton, I would stick to my core business.” It became difficult for me to continue when the majority part of the world was looking the other way. Generating wealth is extremely important but it is not the only purpose in life. You run your businesses for a purpose other than money. Money is a side effect. I sold my mining business, though it was my identity in a lot of ways. Imagine Tata Group selling Tata Steel tomorrow.
Our family was known for two things—mining and football. Football still continues, but mining has disappeared. Why did I do it? Because it challenged my morals and the vision that the founders had set up. I did sell the business at the most profitable time. In three years’ time, mining closed down in Goa due to several illegalities that were happening.
Not that I was a visionary. Not that I foresaw what was coming. But I stuck to my core values and beliefs. The chance of making much more money could be seen in front of my eyes. But I thought it was not my main purpose. My main purpose was to deal with my customers and they weren’t happy in the in the environment that was happening. That’s why I sold the mining business. In three years, the government took a firm stand and closed mining. Till today, even after 11 years, the mining has not started. Now, they are taking initiatives. They are running an auction and a transparent bid process. This is my lesson number one: You may be challenged by the VUCA world but please don’t forget your beliefs and values. Build and sustain those beliefs and values.
Changing Mindset
The second is changing Indian entrepreneur mindset. One needs to look at a bigger mindset. Many of us run family businesses and it’s not easy to run them. When I took over the business, it was largely a family operated and a family controlled business. We operated in six sectors. Our ancestors had their own way of dealing and their times were different. With technology, geopolitics and all of that coming together on you, you need to build professionalism within your organization, take that risk, and go ahead.
The biggest challenge was, how do we pay a salary bigger than ourselves? We all have egos as owners. As the chairman of the company, if I’m getting an X amount, how can my CEO get an X plus one or X plus two? I came out of that mindset, took the courage which never prevailed in our culture, to appoint professionals in all the six segments that we were operating. Today, I can say in a very humble way that each of the segments has grown at least 3X. That’s the kind of risk that one takes without disturbing the vision. You must believe in the empowerment of people.
Embrace Digital
What Covid helped me to do is empower even my middle managers. All our factories were closed then and it taught me two things. One is, how to embrace technology, which was not prevalent in an organization like mine. We also had a mix of youngsters and old people and how do we mingle? That’s another challenge. How do we combine a smartphone app based population with somebody who is not exposed to this in the past?
We embraced technology and digital mode very fast. We empowered middle level managers, because the situation was such that we had to take very quick actions. It exposed me to a lot of junior and middle level managers, whom I would have never seen in my life. If I was in person in the office, I would meet only with my senior team due to lack of time.
It taught me another lesson—to take risk and be much more open to all the employees in the organization rather than with your three or four key people. Send messages across the board. Have a shared leadership and empower people. With your own experience of running the business for so many years, you must know with whom you should take the risk. To start with, you must empower people one level below you and then start looking for people and empower them. Start communicating to them. The younger generation today is not there only for money. Of course, money plays a very key role but they want a purpose for your business. If they believe in the purpose or the vision of the founder or the chairman, they will join. Otherwise, they will not join.
Take Care of Employees
The third challenge that we face today is, how do we take care of our employees? It’s no longer a cost. It’s a dividend that you’re paying yourself. Earlier, we used to take labour as a cost. Today, you can’t think in those terms. Covid has put all of us in one plank. My staff and I could have got Covid and gone to the same ICU.
When we had to cut salaries of employees, we made sure that at the middle level and junior level, there was no cut. It was only at the highest level. It was not even a cut. It was a deferment. You need to take that risk, communicate with people, build the vision that you have created along with people and take them forward. The real challenge is to get all of them aligned to the organization and the only way is to be true to yourself and to be very open about it. Believe that they are part of your organization.
In my grandfather’s days, they used to create a rift between two senior employees, so that they gained. Now, the management methods have changed. Everybody sits in one table and discusses. We have open offices and the cabins are done away with. They only have a sitting area and conference rooms. Change your leadership philosophy to embrace people.
Sustainability is the Key
The fourth thing is, you cannot ignore sustainability issues and technology. Many of us think that we are small, we are not in that game and nothing will happen to us. But with the way that things are happening in technology, climate change and sustainability, it’s so fearsome, that if you don’t act with speed, you will be left behind in the race. We have to be extremely vigilant. We have to start working on a plan. Whatever size you are, you have to go to your drawing board and say, “This is my technology. This is my production. How do I make a difference to the environment and the global climate crisis?”
You have to start with yourself and your employees. Question your organization people as to what you are doing jointly. Initially, we did not take this very seriously and it only became mottos and slogans at board meetings and press conferences. We got pressure from the reverse side. Some of our customers are based internationally. They sent us an ESG grade chart and asked us where we are graded there. They gave us a timeline and said that if in the next three years, we didn’t come to their score, they would be constrained to discontinue their purchase. This is the kind of pressure that is coming.
As a nation, we have committed to net zero emission by 2070. Many of the countries have committed to 2050. We are still 20 years behind. We must embrace renewable sources of energy and change our transportation methods.
Welcome New Technology
One of my companies is listed. I wanted to make a letter to the shareholders because the annual report was supposed to be published. Generally, I talk to my research team, which does research on the industry and write. When I asked them about writing the letter to the shareholders, they wanted three days’ time. I decided to try myself with ChatGPT. It took me just three and a half minutes to get the letter from ChatGPT, which was, in fact, better in language. There’s a deeper message in this, that you can’t ignore technology—whether it’s artificial intelligence, augmented reality or virtual reality. We have to embrace it.
Embracing means that you have to expose your employees of the company, make them more aware of these things, train and reskill them. If you don’t empower them and reskill them, not only will they lose their jobs, but also, we will lose our businesses. Do not think that you are in a sector which doesn’t get embraced by technology. Every single business today is going to be embraced by technology. Covid has changed so much for us. People want to work from home or in hybrid and they are not willing to come to offices full time. We have to change our mindset, look at it in a different way, so that the world moves on and your businesses move on.
No Substitute for Values
Today, because of geopolitics, there’s a lot of distrust. It is commendable that some of our Indian Universities have come in the Top 500 global rankings. But there are three or four Chinese Universities that come in the top 50. We have a lot of catching up to do. India is capable and it has the potential. But we need to understand that we must think big, change our mindsets, empower people and seriously focus on ease of doing business. It is not only for the government to look at it also for the private entities to look at the ease of doing business.
I would like to end with some excerpts from what Mr. Deepak Parekh has written in a recent article in Economic Times: “There is no substitute for time tested values of honesty, integrity and accountability. It is always there. There is no switch on and switch off. As a leader, you must have clarity, humility and courage. Always ensure that humility sticks with you like glue. There is no softer pillow to rest your head at night, than a very clear conscience. Ultimate success is just an illusion, but contentment and honesty of intention are real. Build life worth, not net worth. Think big and act small. Greed and arrogance have been the pitfall of many people. Most people will not remember the work you do. They will remember how you make them feel.”