*The writer is an author. His latest book, JAMSETJI Tata—powerful learnings for corporate success, coauthored with Harish Bhat, was published in July 2024. His ID is rgopal@themindworks.me

Who does not wish to set up and nurture institutions with a long life? Dheerga Ayush or flourishing multi-generational companies nurture engaged employees. Many executives cease to keep their curiosity alive as their career progresses. When you cease to learn, you lose engagement with work. Employee engagement data over thirty years shows a temporal decline across companies and regions. That is why Dheerga Ayush companies like Tata, Castrol Hindustan Unilever track their employee engagement regularly.

Professor Barry Schwartz, a noted American psychologist and academic, has written and spoken about ‘Why We Work’. According to him, Adam Smith opined that human beings are lazy and would not do anything unless the employer made it worthwhile: this led to the factory system with a focus on the number of hours worked.

There has been a hammer and tongs debate about how many hours per week a person should work. Leaders who spoke did so within a context. I have no intention of stoking the dying embers of this fire.  Rather, I wish to explore what work is, especially knowledge-based work. Presumably all our ancestors did not enjoy work, though many of them led a fulfilling life. We work because we desire a ‘fulfilling’ life. Well, what is a fulfilling life?

Fulfilment presumes that there is some deep ambition and a personal purpose. It may be prosaic like feeding your family, or philosophical, like providing music as soup for the soul. Why should anybody assume that the next generation—they are described through alphabets like X,  Z, and Alpha—not be like our ancestors insofar as they too wish to work to fulfil their purpose. When a purpose is fulfilled, work is enjoyed, and the number of hours doesn’t matter.

When I began work six decades ago, I wanted to write computer code, a desire that changed with time and experience. At my interview, Hindustan Lever asked me whether I would consider a career in marketing instead of systems and programming. I was bold—or foolish–enough to decline. A future chairman, T Thomas, told us during our induction in a matter-of-fact manner, “If you are not buying, manufacturing, or selling, you are not in operations.” It was mandatory to learn the grassroots of operations irrespective of the stream of work.

So, I landed up selling Surf in Nashik, Erasmic Cup Soap in Nagpur, and dispatching goods from Mumbai’s Sankli Street warehouse for several months. Thereafter, I was packed off to the factory to study how to plan production so that all six colors of Lux would be available for consumers simultaneously. Was it ‘fascinating’ to visit forty grocery shops every day to transact orders after studying physics and computer science?  Or to watch how the soap packing machines had to be cleaned for several hours for every color change? Gosh no. But did help me to understand how to analyze the system and write code for a better outcome.

What was my lesson? That you enjoy work when you are learning new things. And that you learn new things when you are curious and respectful about work. Learning means personal growth, which nudges you towards your purpose. The employee must be curious, and the employer must provide the employee with work that converts natural curiosity into relevant learning.

There is no place for number of hours in this formula!! That is what start up founders call passion, that is what top-class musicians call riyaz, that is what sportsmen call relentless practice. There are so many paths for a top-class cricketer, for example, to develop. Some have relentless coaching and others like K Srikkanth and Varun Chakravarti were largely self-taught. It is the individual who defines what the criterion of success is.

Our older generations never treated their next generation as ‘immature, wayward, or indolent.’ If they did, our generation would not have surpassed our parents’ in accomplishments and advancements. The narrative, therefore, is not how many hours but what fulfils. And fulfilment and purpose evolve with experience.

I close with a recent narrative about a person called Mr Tamil in Nilgiris. Yes, that is the name his parents gave him, long before MK Stalin made a virtue of Tamil in relation to Hindi. He studied in a convent school, graduated with a B Com from a college, both in Nilgiris, and secured a bank job for two years. Following bereavements in the family, Tamil felt his ‘purpose’ was to be at home with his lonely, ageing father. Upon return to his home, he could only get the job of a car driver. It enabled him to look after his father and achieve what he considered his purpose. I have not met a happier person than Tamil. He was not counting his hours of work, rather he was fulfilling his purpose.

Employee engagement is essential for Dheerga Ayush companies. It is not a human resources issue; it is a leadership issue.

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“Jamsetji Tata: Powerful Learnings for Corporate Success” has struck a chord with readers from diverse backgrounds, proving its timeless relevance. From a Christmas gift recipient to seasoned corporate professionals, the book’s insights are proving both impactful and illuminating.
Sarthak Sahu , one of the winners of a Christmas gift campaign, shared his enthusiastic response: “I thoroughly enjoyed reading it. The idea of how you can build a culture through rituals and icons is something so simple yet profound. Even yesterday, while visiting the Kala Ghoda Arts Festival, I visited Bombay House and Horniman Circle, explaining to my friends the places and Parsi clubs mentioned in the book.” Sarthak also praised the writing style, noting, “Definitely added a few words to my vocabulary.” His experience highlights the book’s ability to connect with readers on a personal and cultural level, extending its reach beyond the boardroom.

Shailesh P Rau , a follower of mine on LinkedIn, delved into the book’s profound exploration of Tata’s core values. “We studied a chapter on Jamsetji Tata in our school days as a man who was a philanthropist, nation builder, nationalist and who had the highest standards of ethics, integrity and social conscience. This book reveals in depth the makings of the DNA of the TATA group.” He further emphasized the book’s detailed portrayal of leadership across generations, noting, “Every chapter throws light on the leadership demonstrated in difficult, challenging circumstances and yet the leaders did the right thing.” Shailesh’s review underscores the book’s depth and its ability to provide invaluable insights into the enduring legacy of the Tata Group.

Source to read full review- https://www.linkedin.com/posts/shairau_book-review-jamsetji-tata-by-r-gopalakrishnan-activity-7271761664759218176-9ILQ?utm_source=share&utm_medium=member_desktop&rcm=ACoAAByv2K0BXL4JV0bETVlmWGrnoyaUipae5XQ

Corporate Citizen Magazine , a respected voice in corporate affairs, offered a comprehensive assessment, declaring the book “a must-read, for it reveals the enduring success of TATA for so many years. It showcases how profit and social responsibility can align, how a businessperson can also be a social engineer.” The review highlighted the story of Sumant Moolgaokar and the creation of the Tata Motors plant in Pune, showcasing how “business and environmental welfare could combine.” The magazine also praised the book’s structure, organized around ten “P’s” – Philosophy, Purpose, Progress, People, Pioneering, Persistence, Principles, Profit, Perspectives, and Postscript – noting how each chapter “contains a lead essay and three stories that exemplify the theme.” They concluded that the book illustrates “the enduring power of the larger good.”

Source To read full review-

https://corporatecitizen.in/v10-Issue6/book-review-learnings-from-the-renaissance-man.html

The reception of ‘Jamsetji Tata: Powerful Learnings for Corporate Success’ has been truly gratifying, and I am particularly keen to hear further reflections from readers. Your insights, whether shared here on LinkedIn or via email at sharewithrg@gmail.com, are invaluable in understanding the book’s impact. I encourage you to delve into the pages and discover the enduring principles of Jamsetji Tata, and I eagerly anticipate the perspectives you’ll bring to the conversation.

These diverse reviews collectively affirm the book’s significance, showcasing its ability to inspire, educate, and provide practical guidance for leaders across all sectors.

#JamsetjiTata #JamsetjiTataPowerfulLearningsForCorporateSuccess #Bookreview #RGopalakrishnan #HarishBhat

The post What Readers Are Saying: Reviews of ‘Jamsetji Tata: Powerful Learnings for Corporate Success’ appeared first on The MindWorks.

*The writer is an author. His latest book, JAMSETJI Tata—powerful learnings for corporate success, coauthored with Harish Bhat, was published in July 2024. His ID is rgopal@themindworks.me

What mental health is for young people, arrogance and ego are to boardrooms. Is the opposite, the quiet, low-profile performer, even possible?

Mahmud of Ghazni is remembered for depravities and wars. Apparently, he had a Hindu army division, which he used to fight rebel Muslims, as during the capture of Zarang fort in 1003 CE. Mahmud’s capital city and tomb are now crumbling, unmarked and uncelebrated. Such is the collapse of arrogant power and pomp!

What mental health is for modern young people, arrogance and ego are to boardrooms. The evidence that CXOs are increasingly affected by arrogance is anecdotal, but a sure trend. In my 2018 book, CRASH, I quoted researchers, who found that power intoxicates a leader, and impairs their judgement (Professors Pamela Smith, Dacher Keltner, Sukhvinder Obhi et all).  The pressure on CEOs to constantly demonstrate energy and competence is excruciatingly intense.

Paradoxically, the performance metrics are subtle and ambiguous—if you can, hear Trump’s view of Biden’s performance!! CEOs are evaluated as if business delivery can be precisely measured. If a CEO cannot deliver growth, increase market share, or report higher profits within a time frame, the person is fired or he or she quietly resigns, like in Starbucks, Paramount Global, and Boeing. Even in conservative Japan, the Suntory chief executive officer, Takeshi Niinami, lamented that Japan has reached a ‘tipping point,’ driven by shareholder activism.  Can India be far behind?

Outsiders do not have authentic information about the company. Reasons behind CEO partings are many, including being authoritarian, arrogant, or behaving as if they are God’s messenger. Investors, CEOs, civil society and corporate boards find that trust is thinning rapidly, just as political leaders experience with their voters.

Conscientious leaders earn long-term trust by doing the right things in the right way at the right time. After the death of Mahatma Gandhi, Lal Bahadur Shastri, and Dr Manmohan Singh, it is their humane qualities–insaniyat, ibadat, and inayat (fairness, courtesy, and grace) –that are remembered. WIPRO’s values, for example, include ‘treating people with respect’, and ‘unyielding integrity’. Leaders are prone to narcissism, and social media aggravate matters. The few who cross the line make big news.

People work through a mental image about leaders’ performance. Numbers help but are prone to cherry-picking. Consider the data on the Manmohan economic record. From 2004-2013, India’s economic performance was among India’s best in eight decades (based on the 2011-12 constant price series). Annual GDP growth was 6.7%, gross capital formation growth was 9.6%, private consumption expenditure growth was 6.2%, per capita income growth was 5.04%, exports’ growth was 12.1%. Manmohan Singh, quietly and without fuss, delivered his amrit kaal with no announcements. Yet MMS did have some failings. Disappointingly, balderdash has developed that that he did not perform. Some incoherent voices also proclaim that India ‘gained independence’ after 2014!

History values CEOs for performance but dearly treasures humble performance. Integrity is ascribed when words match deeds. Narcissism is the gap between leaders’ words and deeds. Narcissistic leaders generate news during their tenure and are later remembered for performance, but also their self-obsession, charisma, demand for personal loyalty, and mental derangement.  When narcissistic leaders have humble backgrounds, acolytes embellish that fact; for example, Nadir Shah, Napoleon, and Hitler, who match all the above characteristics.

Stanford researcher Charles O’Reilly, says that narcissistic leaders believe that they are superior, that rules are meant to be bent, lack empathy, bluff without shame, and never admit their mistakes. Think of Bernie Ebbers of WorldCom, Ken Lay of Enron. Is the opposite, the quiet, low-profile performer, even possible?

I quote published news about the CEO of D-Mart Avenue Super Market. After 22 years as CEO at D-Mart, he is reported to have stepped down. His team built D-Mart into a retailer with 380 stores, a revenue of Rs 50,000 crores, and a market capitalization of Rs 2,20,000 crores. Who knows, maybe after twenty-two years, it is a good time for the CEO to change.

The CEO is Ignatius Navil Noronha, and the promoter is Radhakishan Damani. Ever heard of them? Perhaps they are grateful to be left alone to get on with delivering their targets. Read Navil Noronha’s statement upon moving on, “I believe that D-Mart is a business model that has a multi-decadal runway for growth. If we stay the course of simplicity, efficient costs, happy employees, deep value to customers, and, most importantly, not doing anything else, we will always remain relevant for a long time to come.”

Time will tell if he is right. D-Mart is a great company, but must evolve as a long-lasting ‘institution’. As of now, he seems a rare, humble, self-effacing, and performing CEO, who leads from the back. (refer Ravi Kant’s book Leading from the Back)

The post Humble CEOs are recalled fondly appeared first on The MindWorks.

*The writer is an author. His latest book, JAMSETJI Tata—powerful learnings for corporate success, coauthored with Harish Bhat, was published in July 2024. His ID is rgopal@themindworks.me

The title of this article is inspired by an interesting book by Frank Trompenaars, an expert on intercultural management, The Global M & A Tango.  The tango, a tough act, is a South American dance with a strong rhythm in which two people hold each other closely, complex like in a mergers and acquisitions event.

I am not a great one for astrology, but I am for astronomy. When this article is published around 30th January 2025, six planets—Venus, Mars, Jupiter, Saturn, Uranus, and Neptune—will all align harmoniously in a ‘planetary parade’, visible from India. Such a near-precise alignment is required for success in mergers and acquisitions, M & A.

Recently, the New York Times carried an interesting piece on what matters more for human longevity, genes or lifestyle. The short answer: up to age 85 or so, lifestyle matters; beyond that, genes matter. What about corporate longevity? Lifestyle matters initially, after a certain age, purpose (genes) matters. For companies, lifestyle comprises four factors: business aggression, continuous excellence, innovative adaptations, and mergers/acquisitions. Mergers and acquisitions (M & As) do stress out a company. In this piece, I explore some related aspects.

Emeritus Professor of Anglia Ruskin University UK, Peter Woolliams avers in his foreword to a book, “It is well known that most mergers and acquisitions fail to realize the expected benefits…. Mergers and acquisitions need to be in the business of marriage and not simply weddings.”  (italics mine).

If the divorce rate among married couples is increasing, the solution is not to for people to avoid marriage. In the same spirit, leaders must learn how to increase the probability that M & A works. I doubt that there is sufficient material on what generalizable processes can extract sustainable value from disparate organizational cultures.

My experiences

During my career, I have been closely involved with or been a close observer of corporate M & As in at least fifteen cases over thirty years in multiple countries. Each deal had its own business logic, valuations, regulatory approvals, and the details. As experienced by me, a few were successful (in line with the merger goals), several achieved some success (not quite up to the goals), but a few turned out to be bad or disastrous. I reflect on what was common in the failure cases. The common feature lies in the ‘soft’ side of the acquisition/merger.

What does ‘soft’ side mean? It refers to the imprecise human and motivational aspects of the merger. The rational and analytical aspects of the merger are undoubtedly of great importance. Things can go hopelessly awry on the so-called ‘hard’ side. However, when things go wrong on the ‘hard’ aspect, the manifestation is on the ‘soft’ side. After all, people, more than cash, are a key determinant of success.

A well-known case

During my early career in the late 1960s, M & As were uncommon in India. I got fascinated by the much-publicized merger of the UK’s General Electric Company (GEC), Associated Electrical Industries (AEI), and English Electric (EE).  GEC and AEI first merged in 1967, and, one year later in 1968, EE also merged into the combine. A book was published in 1970, titled Anatomy of a Merger. The hero as well as genius in the narration was Lord Arnold Weinstock, then the British equivalent then of a later Jack Welch. The book stated, “Weinstock’s style of management is very different from that of other giants…. the severe problems will arise when Weinstock retires…a man like Weinstock would not work for the real Weinstock for long.” Several years later, Weinstock did retire.

Cut to about thirty years later when Weinstock died. There were comments about his style as observed over three decades. His ruthless, cost-averse management style, holding managers to tough targets, all produced early results but also seeded decline. In 2002, The Guardian observed, “…. The circumstances of Weinstock’s passing … is a Greek tragedy of management in which its negative elements carry powerful positive morals …… Weinstock’s inquisitions and equally abrasive phone calls strengthened his monarchical style … managers ran scared…. Weinstock hung on too long. Super bosses should be held to the same statutory retirement as anybody else”.

Succession planning for the irreplaceable CEO repeats again and again in public life as well as in corporations. This playbook has been repeated in later years by, for instance, America’s GE, Du Pont, Boeing, and Citibank.

I reflect on my own experiences. By the 1990s, Unilever had several independent entities in India—Lipton, Brooke Bond, Ponds, Doom Dooma, Tea Estates, Kissan, Kwality Icecream, Milkfoods, TOMCO, Lakme, to name a few. These arose due to international or domestic acquisitions over twenty years from the 1980s. There was a legitimate ambition to simplify, synergize, and scale by the creation of a single powerful entity, which is today known as Hindustan Unilever. Here is the Brahma Mantra that I learned. There is a great deal of judgment involved in implementing mergers and acquisitions on the one hand, and creative destruction on the other. There will be multiple opinions and views at any point of time, all of which have to be reconciled to keep moving forward.

Most significantly, it is so important for the leaders to realize that they are the carriers of ‘integrative change.’ Put simply, leaders carry the responsibility to enable people with different cultural perspectives to engage in meaningful and valuable discussions about the new business. The absence of this leadership trait kills M & A.

The post The mergers and acquisitions tango appeared first on The MindWorks.

*The writer’s latest book, JAMSETJI TATA: powerful learnings for corporate success, coauthored with Harish Bhat, has been published in July 2024. He welcomes feedback at his email ID rgopal@themindworks.me

The Leadership Riddle: ‘great man’ or ‘structural forces’

There are two contrasting views about great leadership. Business writing has largely adopted the ‘Great Man Theory’, perhaps inspired by Scottish essayist, Thomas Carlyle, who wrote, “The history of the world is but the biography of great men.” American anthropologist Margaret Mead too had said, “Never doubt that a small group of thoughtful, committed citizens can change the world.”

On the flip side, Dr Jane Ridley, Professor of Modern History at Buckingham University, dismisses the great man theory as ‘romantic claptrap’.  Leo Tolstoy had felt that “history is made by the sum total of an infinite number of small decisions taken by ordinary people, whose actions are too unremarkable to be documented.” In the Structural Forces perspective, geography, economics, technology, and even chance conspire to create the great leader.

I doubt if there is a single truth, and I am inclined to the view about structural forces.

My interest lies in the world of enterprise. George W Merck of American pharma major, Merck & Company, defined his business purpose altruistically,” Medicine is for people and not profits. If you remember that, profits will follow.” One of his successors, Roy Vagelos, initiated the longest-standing donation program in history by supplying free Ivermectin, Merck’s new drug, for river blindness to Africans who could not afford to buy the drug.

The great men of enterprise include two types: those with an insatiable aptitude to chart new paths (John D Rockefeller, Andrew Carnegie) or those who could extract unimaginable efficiency out of resources. In particular, the efficiency extractors are lionized during their times—and, quite often, they are criticized later. Think of Harold Geneen of ITT, Jack Welch of GE, and Carlos Ghosn of Renault Nissan.

Efficiency and effectiveness do not mean the same thing. Technological systems lend themselves to actions of efficiency, while social systems desperately cry out for actions of effectiveness. Peter Drucker was regarded as a great management guru during his lifetime. Charles Handy, who died last month, disliked being called a ‘management guru.’ He preferred to be called ‘a social philosopher.’ Both Charles Handy and Peter Drucker focused their life’s work on the effectiveness vector rather than on the efficiency vector of enterprise.

Society and business organizations are living systems, which must balance efficiency with effectiveness. Too much of one can be a killer. When I ask managers whether an entrepreneur can earn too much wealth or a firm can earn too much profits, my audience is nonplused by the silliness of my question.  The reality is that too much wealth or profit can kill. For example, humans get oxygen through its 20% presence in air. Breathe 100% pure oxygen from a cylinder, and you will be dead in days. Chemical molecules like fentanyl heal when consumed in small doses, but too much kills.

Pre-industrial revolution times of Frenchman Honore de Balzac triggered his remark that behind every great fortune, there lies an equally great crime. Modern enterprises permit legitimate accumulation of wealth. Very wealthy entrepreneurs must figure out what happens after their time. Recall how Swami Vivekananda subtly influenced John D Rockefeller in 1894, “Is it possible that you are merely a conduit for this wealth?” After several years, Rockefeller wrote all his wealth to the Rockefeller Foundation. On 25^th November 2024, Warren Buffet wrote a remarkable letter to his shareholders, “…. hugely wealthy parents should leave their children enough so that they can do anything, but not enough that they can do nothing …. I have watched my children grow into good and productive citizens…they enjoy being comfortable financially, but they are not preoccupied with wealth.” (italics mine).

It will be 28^th December when this article appears, when Ratan Tata would have turned 87. His virtues far outstripped his frailties. That is why so much was written by so many, so many institutions held memorial meetings, and so many causes were launched to memorialize his name. It can be unerringly stated that he was the Ratan of today’s Bharat, whether a Bharat Ratna or not!

Perhaps one big lesson from the life of Ratan Tata, and indeed the 156-year-old experiences of the Tata organization, is that men and women get catapulted amidst the maelstroms of technology, society, geography, economics, and chance to accomplish great things for mankind and society. Recall the humility of Jamsetji Tata when said to Bombay Governor Lord Reay in 1880s, “Providence has favored me with so much wealth.”

Great leaders are team players. Jamsetji with contemporaries like Bezonji Mehta and Burjorji Padshah, JRD with contemporaries like Sumant Moolgaokar and Faqir Chand Kohli, and Ratan Tata with contemporaries like Noshir Soonawala and Jamshed Irani, all felt humbled by their opportunity to play an important role.  It is valuable to reflect on Ratan’s spirit of innovation, wealth creation and community centricity. This is exemplified also by others like TVS, Murugappa, Godrej, Bajaj, Wipro, Infosys and so on.

Food for thought. Happy New Year.

The post The Leadership Riddle: ‘great man’ or ‘structural forces’ appeared first on The MindWorks.

*The writer’s latest book, JAMSETJI TATA: powerful learnings for corporate success, coauthored with Harish Bhat, was published in July 2024. 

Is business a ‘Living Machine’?

For over fifty years, almost every practitioner of business management has probably been a fan of Peter Drucker. I am, therefore, like a bhakt in a temple town as I visit his birthplace, Vienna, to participate in the ‘Davos of Management’. The Global Peter Drucker Forum and the Living Machine Institute in Austria have joined forces to reframe The Next Management, titled as “The India Way: Humanism, Longevity, and Compounding Returns.” In recent times, more people have been struck that the capitalist enterprise model, seeded in America, is perhaps broken. What is the model? Why is it thought to be broken?

The centre piece of the capitalist enterprise model is the joint stock company in which the liability of the shareholder is limited. Over the last decades, the single-minded focus of management leaders has increasingly been to promote shareholder wealth on the premise that the shareholders are the owners of the company. Are they, really? The people who aspire, dream, sweat, yearn, and love are usually not the shareholders, but the people who are most affected by the company—community, society, employees, vendors, for example. The current model has evolved over a couple of centuries concurrently with the industrial revolution. When there is a sharp focus on shareholders, there emerges a strong emphasis on efficiency—of manpower, machines, and capital usage–rather than on effectiveness. What is the difference?

Peter Drucker on Efficiency vs Effectiveness

According to Peter Drucker, you need effectiveness to magnify and translate efficiency into results. Peter Drucker emphasized that the sole purpose of a business is to create and satisfy a customer. In his seminal book, The Effective Executive, he had addressed the difference between effective and efficient. Which is more important when it comes to organizational performance? You recognise an effective organization as one which enables ordinary people to collectively achieve extraordinary results. How simple yet profound–to encourage ordinary people to achieve extraordinary results!

Efficiency is getting a lot of things done, while effectiveness is getting the right things done. Further, Drucker wrote that effectiveness, unlike innate attributes such as talent and intelligence, entails a set of practices you can learn. In fact, it’s essential to learn effectiveness because without it, talent and intelligence won’t get you anywhere.

The contemporary capitalist enterprise model, with its excessive orientation to enhancing shareholder wealth, is hugely committed to efficiency, to extracting the maximum out of a given resource. The model treats enterprise almost like a machine, whose efficiency can be enhanced by continuous improvement. Further, too often, human avarice, greed, and hubris get fed into the menu for efficiency. These lead to enterprise failures like Enron and Lehman Brothers–watch the play, Lehman Trilogy, now running in theatres in London and New York. Think of India’s Satyam Computers and Kingfisher Airlines. The efficiency-only trap is a threat to all enterprises that are fixated on increasing market capitalization (unicorn-aspiring startups to please note).

To minimise the risk of getting entrapped into this web, one must consider an alternative model: effectiveness, underpinned by efficiency. In this model, the shareholder is not the lone God for whom enterprise leaders cater. Employees, community, vendors, and many others who work to make the company into a ‘living machine’ feature in the leadership agenda. The reason is that the value from a ‘living machine’ is superior to that from a machine.  The markers for a living machine are Humanism, Longevity, and Compounding Results, the theme of The India Way discussion at Vienna.

When Roger Bannister broke the four-minute record for running a mile in 1954 at the Iffley Road tracks, many scientific minds opined that the limit of human endurance will not permit any further improvement to the record. Yet, the human ‘living thing’, through advances in motivation, physiology, nutrition, and equipment have made it possible for Moroccan Hicham El Guerrouj to record 3 minutes and 43 seconds. Living Machines yield more than inanimate machines because of flexibility, adaptation, and human consciousness, which machines cannot yet do.

Here is the catch. Dealing with living machines requires reflection, thought, patience and, above all, time. In the belief that their shareholders will not give them time, enterprise leaders push the fixed machine beyond its limits, breaking the machine rather than training it to adapt and renew. Some Indian companies seem to have learnt this, like Godrej, TVS, Birla, Mahindra, Tata and Hindustan Lever. It has been my singular fortune to have served in Tata and Hindustan Lever, where I learnt the ‘Living Machine’ principles from the grassroots.

It is satisfying to expose the ideas of the Living Machine to a global audience.

The post Is business a ‘Living Machine’? appeared first on The MindWorks.

Author                Thomas Mathew

Publisher         Harper Collins, 2024

Reviewer          R. Gopalakrishnan, Author and Corporate Commentator

Date                   16-11-24

Arthur Schopenhauer’s statement in the title is unquestionably appropriate for Ratan Tata.  This book is about a great modern Indian business leader, Ratan Tata. The narration is authentic, based as it is on several hours of taped interviews by author Thomas Mathew with Ratan Tata and with important personalities in India and abroad. It is not clear whether the manuscript received the approval of Ratan. However, having been an insider to the Tata firm during the latter period of the book, I find that the facts pertaining to that period are generally correct, though individual interpretations of facts would differ.

The travails, personality, philosophy, and actions of Ratan Tata emerge as he truly was—understated and shy, but firm and consistent. Just as everyone is strongly influenced by family and upbringing, the strong influence of Ratan’s grandmother, Navajbai Tata, is described in the early part of the book. Ratan refers to her as his ‘guiding light’, who taught him the virtues of humility, and the courage to admit mistakes. The book also states that, “Lady Tata’s empathy for the poor and her earnestness to alleviate their suffering left a lasting impression on Ratan Tata…… this philosophy of philanthropy still largely guides Ratan, the chairman of Tata Trusts.”

He also showed early signs of speaking truth to power in a constructive manner. In his 1983 Strategic Plan to the Tata Sons board, Ratan commented about the lack of cohesion among group companies. It was a relevant, but bold message to send to accomplished leaders like JRD Tata, Nani Palkhivala and his own father, Naval Tata, who were decades older than Ratan. Tata Chemicals’ Darbari Seth disagreed with Ratan and opined that individual company autonomy was the correct way forward. However, Indian Hotels’ Ajit Kerkar concurred by writing, “all individual Tata companies are nothing but branches of the same tree with a common trunk and common roots.” The book reveals, however, that Kerkar’s subsequent behavior was at variance with what he had written!

There is a back-story as to how the Tata companies became centrifugal. It was a response to the demoniac Monopolies and Restrictive Trade Practices legislation of 1969. There was a conscious dilution of companies’ inter-relationships. Viewing future needs, Ratan argued that group spirit and synergy would, in fact, be an asset, and when empowered, he worked persistently at reversing dilution within the group. His skills of advocacy, overcoming objections, showing flexibility, and achieving the principal goal bore fruit when ‘The House’ (as Tata is often called) implemented the Brand Equity and Brand Promotion, the Code of Conduct, and the Tata Business Excellence Models. Tata became a well-knit and cohesive group, rich with ‘Tata-ness,’ by the time he departed. Even a critic must grant that this was a great, if not the greatest, contribution of Ratan Tata.

Ratan’s public esteem developed gradually. By 1985, a MARG survey rated Ratan as India’s most respected CEO with 6.8 points, a whisker ahead of Russi Mody of TISCO, Dhirubhai Ambani of Reliance, and Ashok Ganguly of Hindustan Lever.  The book is 700 pages, covering Ratan’s childhood, his education, his challenges, and his contributions. It is effusive with praise for Ratan; the author does not hide his deepest admiration, which he must have developed after researching the facts for the book.

The truth is that no human being is perfect, so Ratan must have had flaws. There is little reference to this aspect in the book. Serious readers, who study this book as a leadership chronicle, could find this aspect to be weak. It is correct that Ratan practiced and deployed sterling positives, hence glossing over his human blemishes could be considered pardonable.

Most readers would not have had personal or firsthand experience with Ratan. After reading, they would certainly get the impression that he was a highly effective leader, but also, a rare one who led with competence and humility. In a world where leadership is characterized by avarice, hubris, ego, power, and personal agendas, the reader would surely be curious to learn how seemingly opposite virtues like competence and humility were combined into one individual. This is not explicit in the book, but there is enough material to give the reader food for thought, which would be a valuable takeaway for the reader.

Walter Isaacson’s two majestic books on Apple’s Steve Jobs and Code Breaker, Jennifer Doudna, could well have inspired both the author and publisher. The pagination, size of the book, white cover design, and the deliberate separation between the protagonist and the author are similar. Of course, it could be sheer coincidence! Isaacson emphasized that his books were based on many hours of honest and frank interviews given by the protagonist willingly. So does Thomas Mathew.

Isaacson was not required to submit the manuscript to the protagonist for approval. In this book, this aspect is not clear, and it begs the question–is it likely that Ratan would have approved the manuscript? Knowing Ratan as I did, I feel that he might well have hesitated to formally agree to the content of this book. In his opinion, his achievements may have been overstated.

To strengthen this view, it is noteworthy that the book was released so soon after his death! I must recall a separate incident from twenty years ago: an over-enthusiastic board colleague had installed Ratan’s painting in the Bombay House board room alongside Jamsetji, JRD and earlier chairmen. Ratan roared an uncharacteristic instruction to a hapless peon, “Kaun bola laganeko? Hum marne ke baad lagao.” It is important to note that the author did not receive funding or hospitality for the book. He emphatically states, “I was determined to undertake the project as an independent research work, without taking any assistance, financial or otherwise from Ratan, lest the work should lose its credibility.”

Most Indian biographies are commissioned by the family and turn out as hagiographies. In this case, the author has invested his time, personal funds, research resources, and writing skills to produce a different kind of biography.

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*The writer is an author. His latest book, JAMSETJI TATA—Powerful Learnings for Corporate Success. Coauthored with Harish Bhat, was published in July 2024. His ID is rgopal@themindworks.me

During the highest growth years of India during the 2003-2008 period, I held the view that India is now unstoppable. My view today continues to be optimistic in the long cycle, but with bumps along the short cycles. Russian economist, Nikolai Kondratiev, had argued that nations move according to the waves of long cycles. People usually think about the shocks and imperatives of short cycles, but these occur within that long cycle.

India liberalized its economy approximately 15-20 years after China and has been less directive with reforms compared to China. How do we compare?

Around 2005, I reckoned that India was about 20 years behind China, based on consumption per capita of shampoo, soaps, electronics, steel, automobiles and so on, rather than macro-economic data. I still think that India is about 20 years behind China.

Twenty years ago, China consumed 220 million tons, and today, India consumes 175 million tons of steel. China now consumes 750-800 million tons of steel, but the per capita steel consumption in China is declining as the build-out of infrastructure has peaked. India’s per capita steel consumption doubled in just the last decade. In two wheelers, China and India are already level. China and India both consume about 18-20 million two wheelers per year. This rise of India is a part of the long cycle of the rise of Asia.

The Long Cycle:  

The Russo- Japanese war of 1905 was the start of the Asian long cycle. In 1904-1905, the Japanese definitively defeated the Russians after centuries of western expansionism, colonialism, and mercantilism. The battle of Tsushima is famous because after centuries, an Asian empire defeated a European empire. In the early 1900s, Europe plus America accounted for over two thirds of the global GDP. Since the Russo-Japanese War, the west has declined to about one third, whereas the ‘rest of the world’ has climbed to two thirds! This is what I mean by the long cycle.

The master narrative for Asia changed after 1905 from ‘we are subservient’ to ‘we can overcome.’ Historians trace the influence of this event on litterateurs and intellectuals like Rabindranath Tagore, Bankim Chandra Chattopadhyaya, and Mahatma Gandhi in India, and Lian Chichow, Sun Yat Sen and Chiang Kai-shek in China. After 1905, other Asian nations rose sequentially through the long cycle. First, Japan, then Taiwan and South Korea, followed by the Asian Tigers in the 1970s onwards, followed by China. India has been on the rise over three decades.

A new master narrative was written after India’s independence from being a colonial subject to becoming an independent nation undergoing the challenges of consolidation and staying together. It is a miracle that, compared to other emerging independent nations, our multi-ethnic, multi-lingual, multi-religious India has stayed largely democratic and intact notwithstanding its imperfections. The focus from 1947 till 1991 was to hold together in the face of centrifugal forces. The leaders from 1947 did a superb job of this.

In 1991, with economic liberalization, the Indian master narrative was rewritten. What we are seeing since the 1991 period is the emergent nature of India within the longer Kondratiev cycle of Asian resurgence—growing bigger, showing confidence, and impacting the world. This master narrative is likely to continue playing out for a few decades ahead.

The Short Cycle:

During the last 20 years, the Indian stock market has returned more than 13% CAGR in USD terms, higher than any other large stock market. [1] Considering even the last 30 years’ data, Indian stock market has returned handsomely, and second only to US among the world’s ten largest stock markets.

The growing infrastructure investments within India and, likewise, the growing investors’ confidence both reflect in increased FDI inflows. From about USD 30-35 billion per year in FY 13, net FDI inflows have doubled to about USD 70-80 billion in recent years, representing 2-3% of an increasing GDP.

Over the 30-year period since 1990, corporate tax rates have declined from about 60% to about 25%.

In sum, despite the short cycle analytics and reportage about India’s social and political problems, there emerges a durable story of growth on a consistent basis in the 30 years since liberalization.

It may be noted that the GDP growth highs achieved during earlier years of 1991-2013 have not been matched.

Truth be told, an annual growth of 6-7% will not be sufficient for India to reach the status of ‘developed economy’ in my lifetime. This is so despite a contemporary smugness that India is growing fast compared to all her slowing-down peers.

What remains unfinished in India’s agenda?

Per Capita Income: The focus of India’s efforts must shift from GDP (ranked 5^th in the world) to per capita income (approximately ranked 150^th in the world). Increase in per capita income can trigger demand increases with several attendant benefits to the national economy.

Social Sectors: India needs a huge uptick into social investments in primary education and public health. Those states that invested more than the national average have forged ahead. Tamil Nadu more resembles the Southeast Asian tigers at the current stage.

Private Capital Investment: Private gross capital formation has lagged public investment. Ministers have harangued Indian industry to ‘release animal spirits’ but corporate action has not followed. It is worth pondering on the reasons.

Job Creation: If the above measures (and many others) are undertaken, there is a good chance that new job creation will match the uneven population growth in the country. Already the south shows signs of importing workers from outside the south.

Uneven Wealth Creation: India is at the phase of hugely unequal wealth creation. The top 5% of the population, numbering 70-80 million people, are on the fast track, while the others are stuck in the slow track.

India is benefitting from the compounding effect over 75 years, not merely recent decades. We have experienced 50 years of consolidation, and 25 years of the economy creating wealth; we now await what our traditional wisdom demands—a phase of upliftment for all.

For this, among other things, India needs several SHE companies—sustainable, humane, enlightened companies. Depending on a few is not good, especially because some wallow in a strong sauce of viscous and perpetual controversy.

[1] Behold the Leviathan, Saurabh Mukherjea and Nandita Rajhansa, Penguin, 2024

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