Required literature: Hill, L.A. (2007). Becoming the boss. Harvard Business Review, 85, 49-56.

Accelerat ing t he world's research.

Leading Through Customer Service:

The ICICI Bank Way
Dr Alok Kumar Rai

usrRo, d> yd, oa ij [k 115

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 Contents

MTI FOUNDATION DAY SPECIAL ISSUE

An Insight
Contents into
"Leading for
Future"

Just One Point 3

Sushim Banerj ee

FEAT URE ART ICLES

Sust aining Leadership in St eel - A SAIL Perspect ive 5

S. K. Jain

Leading for t he Fut ure : SAIL St ory 20

Sushim Banerj ee

Transformat ion Leadership : The Inner Experience 27

Swami Shashankananda

Leading t hrough Cust omer Service : The ICICI Bank Way 34

Dr. Alok Kumar Rai

Leading for t he Fut ure 43

S. R. P. Shukla

Leading for t he Fut ure : Role of HR 52

Dr. P. K. Banerj ee & Shwet a Singh

Value Creat ion and Sust ainable Compet it ive Advant age for Corporat e Leadership 61
B. Chowdhury

READERS' FORUM

Developing Leaders for t he Fut ure : What large Organisat ion need t o do 72
Shoeb Ahmed

Leading for Fut ure : People Management 75

P. V. S. Sarma

Mergers & Acquisit ions : An Essent ial Skill for Fut ure Leader 81
S. K. Panda

1
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

CASE ST UDY
Contents Case on Leading for Turnaround and Fut ure Pat h of Growt h 86
Dr. Hari Haran

Organisat ion Development (OD) Int ervent ion in Public Ut ilit y :

The Case of Sundarpur Municipal Corporat ion 93
Dr. S. K. Bhat t acharya

ARTICLE DIGEST

How Leaders Creat e and Use Net works 101

Herminia Ibarra & Mark Hunt er

Becoming t he Boss 104

Linda A. Hill

BOOK REVIEW

Leadership for t he Ages 108

David P. Hann

Facilit at ing To Lead - Leadership St rat egies for a net worked world 111
Ingrid Bens

HINDI ARTICLE

usr`Ro ,d >yd ,oa ij[k 115

MkW0 jRus'k prqosZnh

BIBLIOGRAPHY

Leadership : A Select Bibliography 112

Dr. P. K. Banerj ee

2
 Just one Point

Every progressive organisat ion const ant l y endeavours t o

l ive f or t he f ut ure and ut il ises present moment s f or it s
f ut ure glory. Creat ing glorious f ut ure is cert ainly a dif f icult
t ask as f ut ur e cont ai ns el ement of uncer t ai nt y. Many
organisat ions cease t o l ive in f ut ure mainl y because such
organisat ions are st ruggling t o survive in present and planning
f or f ut ure is not given due import ance by t he l eadership.
The l eadership rol e is l ooked wit h it s bigger pict ure of
l eading organisat ions t o magnif icent f ut ure. Leading t o
f ut ure requires t ransf ormat ion process embedded wit h many
vit al and import ant st eps. Set t ing vision of a company is t he most f ormidabl e Progress towards
beginning of l ooking int o f ut ure and sharing vision has become imperat ive f or future requires
l eaders t o carry f orward t heir organisat ions t o achieve vision. This al so invol ves flexibility to mould
def ining l ong-t erm goal s which are broken int o short t erm goal s t o move in l ine the organisation as
wit h t he vision of t he company. per needs of business
Changing environment and market scenario inf luence t he organisat ional st rat egies environment. Leaders
and processes t hereof . Organisat ions need t o t ake appropriat e act ions t o shape prepare their people
t heir f ut ure under changing business environment . It can be f acilit at ed by visionary with flexible approach
l eadership by t uning organizat ional st rat egies and syst ems f rom t ime t o t ime t o so that people
enabl e t he organisat ion t o cope wit h changes in f ut ure. Progress t owards f ut ure contribute as expected
requires f lexibilit y t o mould t he organisat ion as per needs of business environment . in view of new
Leaders prepare t heir peopl e wit h f l exibl e approach so t hat peopl e cont ribut e organisational
as expect ed in view of new organisat ional priorit ies. There are exampl es of many priorities.
leading companies which involve managers t hrough suit able int ervent ions t o deliberat e
on f ut ure and f ormulat e act ions t o lead t he company t o t he f ut ure pat h of growt h.
Fut ure-orient ed mindset is t o be creat ed among peopl e so t hat t ransit ion t o
f ut ure is smoot h. Past experience is an asset and l eaders shoul d use t he l earning
f rom past f or nurt uring t heir organisat ions f or t he f ut ure. Past can be guide when
t here is cont inuit y of past , present and f ut ure. Leaders have t o act as guides
t o propel organisat ions int o f ut ure wit h such cont inuit y. But t he nat ure and
speed of change decouple fut ure from past and present in many inst ances. Leadership
shoul d be more of t ransf ormat ional and inspirat ional when t he f ut ure needs t o be
l ooked af resh. Leading t o f ut ure has emerged as chal l enging and prominent rol e
now f or managers in t heir l eadership posit ions.

(Sushim Banerj ee)

Execut ive Direct or (HRD)

3
GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

4
 SUSTAINING LEADERSHIP IN STEEL - A SAIL PERSPECTIVE : JAIN

Sustaining Leadership in Steel - A SAIL Feature

Perspective Article

S. K. Jain

Abst ract
The mantra for
In t he emer gi ng busi ness cont ext , onl y t hose or gani zat i ons wi l l sur vi ve and pr osper,
who have t he capabi l i t y t o vi sual i ze what l i es ahead and t he capaci t y t o devel op t he
leading the future is
necessar y st r engt h, knowl edge and r esi l i ence t o l ead t he f ut ur e. St eel i ndust r y has sustained
made a r emar kabl e comeback i n r ecent year s. Fuel l ed by hi gh r at e of t echnol ogi cal technological
innovat ions and real increase in compet it iveness of st eel , SAIL t oo st eered a spect acul ar upgradation, well
t urnaround. While passing t hrough t his phase of rej uvenat ion and cont inuous improvement formulated business
i n al l f acet s, we dr ew our ambi t i ous gr owt h pl an desi gned t o enhance our hot met al strategies, a work
pr oduct i on capaci t y t o 22. 5 mi l l i on t ons by 2010. SAIL t oday pr esent s a pi ct ur e of a environment that
dynami c and buoyant busi ness ent i t y movi ng ahead t o car ve out a ni che f or i t sel f .
promotes creativity
Whi l e capaci t y augment at i on i s a si gni f i cant par t of our ni che st r at egi es, t her e ar e and innovation and
sever al ot her chal l enges f aci ng st eel i ndust r y i n gener al and SAIL i n par t i cul ar. The multifaceted
dynamism of st eel is dependent on compet it ion bet ween st eel companies, driving excellence
development of our
and i nnovat i on. Every st eel company must have i t s own st rat egy based on i t s part i cul ar
ski l l s and st r engt hs and t he l eader shi p of f ut ur e wi l l go t o t he compani es t hat ar e
people while working
most compet i t i ve i n t er ms of cost , i nnovat i on and dynami sm. in harmony with
society, environment
We have br ushed up our f undament al s and t he or gani zat i on i s wel l poi sed t o f ace t he
compet i t i ve envi r onment of t he f ut ur e. The mant r a f or l eadi ng t he f ut ur e i s sust ai ned
and nature.
t echnol ogi cal upgr adat i on, wel l f or mul at ed busi ness st r at egi es, a wor k envi r onment
t hat pr omot es cr eat i vi t y and i nnovat i on and mul t i f acet ed devel opment of our peopl e
whi l e wor ki ng i n har mony wi t h soci et y, envi r onment and nat ur e. We have a hand on
t he pul se of mar ket and we have chal ked out our gr owt h t r aj ect or y accor di ngl y. And,
we ar e cont i nuousl y wor ki ng t o cr eat e an envi r onment t hat pr omot es cr eat i vi t y and
i nnovat i on and devel ops peopl e t o t hei r hi ghest pot ent i al . Thi s ar t i cl e el abor at es on
t he pl ans and st r at egi es t hat wi l l not onl y sust ai n our posi t i on as t he l eader of st eel
i ndust r y i n Indi a – but al so as an or gani zat i on whi ch wi l l l ead t he Indi an st eel i ndust r y
i nt o f ut ur e.
Key Words : Cost compet i t i veness, Tur nar ound, Qual i t y Impr ovement s, Mer ger s &
Acqui si t i ons.
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

* Execut ive Direct or (Works), BSP, SAIL, Bhilai

5
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature 1 . 0 Int roduct ion
Article In t he emer gi ng busi ness cont ext ,
most organizat ions have t o grappl e
wit h ever int ensif ying compet it ion.
Wi t h t he r ecent devel opment s i n
i nf or mat i on t echnol ogy, i nt er net
market i ng and e-commerce, whol e
worl d has become a common gl obal
mar ket pl ace and no moder n day
organi zat i on can seek t he shel t ers
of t radit ional business advant ages.
Cust omer is t he real king, wit h each
and every organizat ion vying f or a
pi ece of smi l e on hi s f ace. Many
organizat ions having set t he wrong
foot forward, have lost t his opport unit y
In today’s complex,
t o cat er t o a wider, in f act a gl obal ,
chaotic and rapidly cust omer base and have been pushed
changing business out of business. In t oday’ s compl ex,
environment, only chaot ic and rapidly changing business
those organizations environment , only t hose organizat ions
will survive and wi l l survi ve and prosper who have
prosper who have the t he capabil it y t o visual ize what l ies
capability to ahead and are f l exibl e and resil ient
visualize what lies enough t o moul d t hemsel ves t o l ead
ahead and are flexible t he f ut ure.
and resilient enough St raddl ing t he Indian st eel indust ry
to mould themselves f or nearl y f our decades, SAIL, t oo,
to lead the future. has experienced t he winds of change
and weat her ed t he t umul t uous
upheaval s of a r ut hl ess busi ness
environment . In part icul ar, t he l ast
t wo decades wil l be remembered as
one of t he most t urbul ent phases of
Indi an st eel i ndust r y. Thi s per i od
wit nessed sweeping changes in Indian
st eel arena – t ransf ormat ion of sel f
cont ained nat ional market s int o linked
global market s and consequent f ierce
compet it ion; st eep rise in input cost s;
a f at al sl owdown in growt h of st eel
int ensive indust ry leading t o reversal
of f or t unes of many st eel maker s
6
and t hen a giant upsurge in demand
(see t abl e 1), bringing about some
of t he most spect acul ar t urnarounds
ever wit nessed by t he Indian st eel
indust ry.
Riding t he waves of an upbeat market
and fuelled by it s renewed ent husiasm,
SAIL, t he Indi an st eel maj or has
recorded good perf ormance in past
f ew years. SAIL’ s st eady ascent has
been f aci l i t at ed by al l ar ound
i mpr ovement i n i t s pr oduct i on,
product ivit y and cost ef f ect iveness.
Af t er achi evi ng an i mpr essi ve
t urnaround, t he company t ook f urt her
st r i des, consi st ent l y addi ng t o i t s
cumulat ive profit s. SAIL t oday present s
a pict ure of a dynamic and buoyant
business ent it y moving ahead t o carve
out a niche f or it sel f in t he domest ic
and gl obal st eel market .
2 . 0 The Fut ure of St eel
The l ast t wo decades of l ast cent ury
wi t nessed a dramat i c sl owdown i n
rat e of growt h of st eel demand. It
was a period of reconst ruct ion and
rat ional izat ion in t he indust ry. There
were cl osure of many st eel works in
West ern Europe and Nort h America.
Wit h t he int roduct ion of new cut t ing
edge t echnol ogies in st eel making,
cast i ng and r ol l i ng, t her e wer e
dr amat i c i ncr eases i n l abor
pr oduct i vi t y, but , t her e cont i nued
t o be excess product ion and f al l ing
prices f or st eel. Many st eel companies
suf f ered considerabl e l osses in t his
per i od, as t he st akehol der s saw
dest ruct ion in value of t heir businesses.
By beginning of t he new mil l ennium,
t here was a posit ive change in t he
busi ness at t i t ude of st eel makers.
The i ncr eases i n ef f i ci ency i n t he
 SUSTAINING LEADERSHIP IN STEEL - A SAIL PERSPECTIVE : JAIN
i ndust r y wer e passed on t o t he
cust omer s and t hi s i ncr eased t he
compet i t i veness of st eel , enabl i ng
i t t o recapt ure t he market l ost t o
compet i ng mat er i al s. Al so, t he
st eel makers real ized t hat it s f ail ure
t o mat ch it s product ion t o real demand
f or st eel and t he t empt at ion t o chase
mar gi nal busi ness at l ow pr i ces
dest royed t he business f or al l .
Cont r ar y t o t he opi ni on of many
business pundit s, t he st eel indust ry
resurged wit h vengeance. The past
f ive years have seen st rong growt h
in demand of st eel , not onl y in j ust
a f ew segment s, but worl dwide. The
prof it abil it y of st eel companies is at
accept abl e l evel f or t he f irst t ime
i n a gener at i on. And, t o t op t hat
of f , t he l ast year was an except ional
year. However one quest ion st ill looms
l arge in t he minds of st eel makers
al l around t he worl d – “ Is t his period
of upsurge going t o l ast or are we
j ust exper i enci ng a br i ef st opover
at t he peak of cycl ical st eel business
curve? Are we real l y moving t owards
becoming a rel iabl e and dependabl e
business f or st akehol ders?” The way
we approach our f ut ure wil l answer
t hese quest i ons. Paul Val er y, an
eminent French poet , had once said:
“ The t r oubl e wi t h our t i mes i s t hat
f ut ur e i s not what i t used t o be”
In a worl d, where change is t he onl y
const ant , it is not an easy t ask t o
chal k out our f ut ure st rat egies, l et
al one predict t he f ut ure. But , one
t hing is f or cert ain – t he choices we
make t oday wil l det ermine our pl ace
in f ut ure as an organizat ion. We have
al ready set a f oot in t hat direct ion
wi t h our ambi t i ous gr owt h pl an
designed t o enhance our capacit y t o Feature
22.5 Million Tons by 2010. But capacit y Article
enhancement is onl y a part of our
mul t idimensional st rat egy t o widen
our market s, expand our cust omer
base and be a world class corporat ion.
Today, we are wel l poi sed t o f ace
t he compet it ive environment of t he
f ut ure and we have t o t ake f urt her
st r i des i n t he r i ght di r ect i on t o
consolidat e our posit ion as t he leader
of Indian st eel business. In t his cont ext ,
i t i s i mper at i ve f or us t o t ake a
syst emic view of t he current st eel
business scenario t o def ine t he key
chal l enges and how we pl an t o
out maneuver t hem. In a world, where
3 . 0 The Key Challenges change is the only
Whi l e addr essi ng t he Indi a St eel constant, it is not an
Summi t , on Mar ch 29 t h, 2007, Ian easy task to chalk out
Chr i st mas, secr et ar y gener al of our future strategies,
Int ernat ional Iron and St eel Inst it ut e let alone predict the
point ed out : future. But, one thing
“ The key chal l enges t hat st eel makers is for certain – the
ar ound t he wor l d f ace can be choices we make
ident if ied around six t hemes – capacit y today will determine
i nvest ment , r aw mat er i al s, mar ket our place in future as
devel opment , compet i t i veness of an organization.
st eel , envi r onment al i mpact s and
peopl e. ”
True t o t he views expressed in t his
st at ement , t he Indian and global st eel
landscape is t ransforming very rapidly.
In t he new landscape, t he st eel makers
wil l have t o compet e in a compl ex
and challenging cont ext , t hat is being
t ransf ormed by many f act ors – f rom
st rat egic consol idat ions, invest ment
i n new r aw mat er i al pr oj ect s,
t echnological development s, inf usion
of new t echnol ogy as new capacit ies
come up t o t he devel opment and use
of knowl edge i n st eel maki ng and
7
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature market ing st rat egies.
Article The key t o succeed in t his environment
is t o develop t hat acumen t o perceive
t hese challenges as opport unit ies. The
opport unit ies f or l eadership al ways
come in disguise of chal l enges and
t he pat h t o f ut ure is f ul l of t hem.
SAIL l eader shi p has evol ved a
mult ipronged st rat egy t o excel in f ace
of mul t i t ude of t hese chal l enges –
right f rom growt h orient ed capacit y
invest ment , an aggressive market ing
pl an, t hr ust on new pr oduct s
devel opment , i nvest ment i n r aw
mat erial proj ect s t o st rat egic social
responsibil it y measures.
4. 0 Gr owt h Plan
Our nat ional st eel pol icy envisages
a gr owt h of ar ound 3 % i n st eel
The opportunities for
consumpt ion in t he worl d. The rat e
leadership always
of gr owt h i n domest i c st eel
come in disguise of
consumpt ion during t he past f if t een
challenges and the
years have been around 7 %and given
path to future is full t he proj ect ed nat ional income growt h
of them. r at e of appr oxi mat el y 7-8 %, t he
proj ect ed st eel consumpt ion growt h
rat e i n Indi a woul d be around 7. 3
%. The st rat egic goal of nat ional st eel
policy is t hat India should have a modern
and ef f icient st eel indust ry of gl obal
st andard, cat ering t o diversif ied st eel
demands.
In l i ght of t he pr oj ect i ons and
expect at i ons of our Nat i onal St eel
Policy, we have st ruct ured our growt h
pl an f or achi evi ng or gani zat i onal
gr owt h and r et ai n our posi t i on as
t he l eader of Indian st eel indust ry.
This will also cont ribut e signif icant ly
t o our nat ional int erest s given t he
st rong f orward and backward linkages
of t he st eel sect or. Changes in business
environment call f or periodical review
8
of long-t erm plans and set t ing of new
goal s. Wi t h buoyancy now havi ng
ret urned t o t he st eel market , and
wit h encouraging growt h proj ect ions
emerging f or st eel on a gl obal l evel ,
r e- f or mat i on of SAIL’ s l ong- t er m
out l ook was a nat ural out come.
SAIL’ s Corporat e Pl an 2010 has been
f or mul at ed wi t h t he obj ect i ve of
enhancing t he company’ s posit ion in
growt h market . This plan is blueprint
of t he company’ s act ivit ies over t he
next f ew years. The company’ s l ong
t er m st r at egi c or i ent at i on i s f or
buil ding a robust organizat ion wit h
st rong f undament al s. Corporat e Pl an
2010 aims t o bring t he company closer
t o t his goal by buil ding sust ainabl e
compet enci es based on gr owt h by
opt imal ut ilizat ion of available asset s,
dif f erent iat ion t hrough qual it y and
services, prof it abil it y by excel l ence
in operat ions and cost reduct ion and
l everaging t he skil l and knowl edge
base of t he company’ s human
r esour ces.
Pl anni ng an i nvest ment of ar ound
Rs. 38000. 00 Crores, t he pl an aims
at increasing t he hot met al product ion
t o 23 MT, crude st eel t o 22 MT and
sal eabl e st eel t o 21 MT (See t abl e
2). This woul d be achieved t hrough
opt imal ut il izat ion of asset s coupl ed
wit h marginal capacit y expansion in
growt h segment s. Addressing 34t h AGM,
SAIL Chairman Mr. S. K. Roongt a st at ed
t hat :
“ The expansi on pl ans ar e not ai med
at vol ume gains al one. Benef it s woul d
come by way of al l - r ound
i mpr ovement i n pr oduct i vi t y l evel s
i n al l ar eas of oper at i on. Issues
per t ai ni ng t o el i mi nat i on of
 SUSTAINING LEADERSHIP IN STEEL - A SAIL PERSPECTIVE : JAIN
t echnol ogi cal gaps, ener gy savi ngs,
yiel d improvement , pol l ut ion cont rol ,
mat chi ng i nf r ast r uct ur e f aci l i t i es,
et c. , wi l l be f ul l y addr essed. Wi der
pr oduct -mi x wi t h emphasi s on val ue-
added pr oduct s, i mpr oved pr oduct
qual i t y, enhancement i n t er ms of
grades and dimensions, will be ensured
wi t h l at est aut omat i on. ”
The SAIL Chairman added t hat wit h
f ocused ef f or t s i n ar eas of cost
compet i t i veness and qual i t y
i mprovement , t he company’ s sol i d
f i nanci al f oundat i on and ski l l ed,
commit t ed and experienced human
resources, SAIL is wel l set on it s way
t o a gl or i ous f ut ur e. Taki ng a cue
f rom past , we have planned t o f inance
t he ent ire proj ect wit h our int ernal
accrual s and market borrowi ngs i f
necessary, while maint aining t he debt
equi t y r at i o at 1: 1. The pl an al so
f ocuses on i nt r oduct i on and
augment at i on of new and ener gy
ef f icient t echnol ogies whil e phasing
out t he obsol et e ones compl et el y.
5. 0 Gear ing up f or Fut ur e
The Corporat e Plan 2010 will definit ely
provide us a higher pedest al and t he
necessary l everage t o l ead t he st eel
indust ry in India, but t here are some
f ormidabl e chal l enges ahead and it
i s necessar y t o combat t hem
ef f ect ivel y. The f irst and f oremost
amongst t hese is t he cont inuous rising
cost of input s including raw mat erials
(See Figure 1) and power.
Indi a has l ar ge i r on or e r eser ves,
but t he qual it y of iron ore and coal
i s ver y l ow. Indi a’ s i r on or e have
rel at ivel y high al umina and l ow iron
cont ent whi ch causes adverse sl ag
chemist ry. In addit ion, ores are l ess
cl osel y si zed and cont ai n l ar ge Feature
amount of undesirabl e f ines t han in Article
ot her count ries. Similarly, t he coking
coal avail abl e indigenousl y has high
ash cont ent and being met al l urgical ,
it is not suit abl e f or making coke f or
reduct i on of i ron and i ron ore. As
such, t he indigenous coking coal has
t o be blended wit h t he required amount
of i mport ed coki ng coal . We need
t o devel op new t echnol ogies and ore
benef iciat ion schemes t o use t he raw
mat eri al at hand and ut i l i ze t hem
ef f ect ivel y f or our purpose.
The Raw Mat erial Division (RMD) of
SAIL manages f i ve envi r onment al
f r i endl y or e mi nes at Ki r i bur u,
Meghahat uburu (i n Jharkhand) and
Bol ani, Barsua and Kal t a (in Orissa)
We need to develop
whi ch cat er t o t he r aw mat er i al
new technologies and
demands of east ern sect or st eel plant s.
ore beneficiation
In addit ion t o t his, some of t he unit s,
l ike Bhil ai St eel Pl ant owns capt ive
schemes to use the
iron ore mines. In view of t he proposed raw material at hand
capacit y expansion program, RMD has and utilize them
i ni t i at ed pr oj ect s l i ke capaci t y effectively for our
expansion of Bol ani, devel opment of purpose.
Maghahat ubur u cent r al bl ock and
Kiriburu’ s sout h bl ock, devel opment
of Tal dih bl ock and opening a new
mi ne at Thakur ani .
Cor por at e Pl an 2010 i ncl udes
development of t wo mechanized iron
ore mines at Rowghat in Chat t isgarh
and Chiria mines in Jharkhand. It is
pr oposed t o use st at e- of - ar t
t echnol ogy i n bot h t hese mi nes t o
ensur e assur ed suppl y of r equi r ed
quant it y of qual it y iron ore t o SAIL
plant s. Also incorporat ed in Corporat e
Plan is set t ing up of pellet plant s one
by Bhil ai St eel Pl ant and anot her by
Raw Mat erial s Divisions t o ut il ize t he
large amount of undesirable ore f ines
9
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature gener at ed dur i ng t he mi ni ng
Article operat i ons. Thi s i n t urn wi l l bri ng
down t he overal l cost of input s. The
capacit y expansion pl ans woul d al so
increase t he demand of coking coal
f rom current l evel of 15 mil l ion t ons
t o 28 mil l ion t ons. The SAIL –BCCL
(Bhar at Coki ng Coal Li mi t ed) MoU
for development of Moonidih coal mine
seam is one concret e st ep t aken by
SAIL leadership t owards ent ering int o
st r at egi c i nvest ment s/ t i e-ups f or
coking coal blocks in India and abroad.
Yet anot her maj or issue is t he present
r ound of mer ger s and acqui si t i ons
occurring in our indust ry. Our past
Mergers and experiences suggest t hat st eel demand
acquisitions are wil l grow wit h increment al dips in
considered as a major demand. In order t o secure our raw
vehicle of faster mat er i al sour ces and expand our
growth, and they are mar ket base, whi l e r emai ni ng
unaf f ect ed by t he cycl ical nat ure of
also an effective
st eel market , we need t o consolidat e
means of
our st rengt hs. Mergers and acquisit ions
consolidating and
are consi dered as a maj or vehi cl e
building synergies in
of f ast er growt h, and t hey are al so
an otherwise
an ef f ect ive means of consol idat ing
fragmented steel
and building synergies in an ot herwise
industry.
fragment ed st eel indust ry. The merger
of IISCO wit h SAIL is a mil est one in
our company’s march int o t he f ut ure.
It is a bold st ep t owards st rengt hening
t he company by building bet t er synergy
and cr eat i ng a gr eat er val ue f or
shar ehol der s. SAIL i s al so l ooki ng
f orward t o provide opport unit y f or
syner gy and gr owt h by mer ger of
Neelanchal Ispat Nigam Limit ed (NINL)
and Maharasht ra Elect rosmelt Limit ed
(MEL) wit h it sel f . Merger of MEL, a
subsi di ar y of SAIL, wi l l r esul t i n
backward int egrat ion by t he way of
manuf act ure of f erro-al l oys – a key
input f or st eel making.
10
Ent ering int o it s largest j oint vent ure
wit h a privat e sect or company, SAIL
si gned a MoU wi t h M/ s Jai pr akash
Associat es Limit ed (JAL) t o f l oat a
j oint vent ure company f or producing
2. 2 MT of cement per annum. This
j oint vent ure is f ormed as a part of
SAIL’ s environment al f riendl y ef f ort s
t o di spose t he Bl ast Furnace Sl ag.
The Joint vent ure will enable t he plant
t o gainf ully ut ilize t he slag generat ed
in it s bl ast f urnaces.
In addi t i on t o t hi s, SAIL, NMDC
( Nat i onal Mi ner al Devel opment
Corporat ion) and RINL (Rasht riya Ispat
Nigam Limit ed) have agreed t o ent er
int o a st rat egic business rel at ionship
by f or mi ng a j oi nt vent ur e t o set
up an int egrat ed st eel pl ant of f our
mil l ion t on capacit y in t he st at e of
Chat t i sgar h.
6 . 0 Cont inual Learning
Business st rat egies are f ocused t ool s
in t he sense t hat t hey are aimed at
a par t i cul ar obj ect i ve, but i n t he
l ong run, t he onl y sust ainabl e source
of compet i t i ve advant age i s an
organizat ion’ s abil it y t o l earn f ast er
t han it s compet it ors. No out side f orce
can t hrow away t he moment um of
t hat advant age away f r om us. As
Arie De Guess, t he f ormer coordinat or
of Royal Dut ch said:
“ Any i nsi ght or i nvent i on, whet her
i t ’ s a new pr oduct or pr ocess and
even a new way of mar ket i ng i s r eal l y
a l ear ni ng pr ocess. And, we do not
have t o be secr et i ve – pr ovi ded t hat
we do not st and st i l l . If we cont i nue
t o l ear n and i nnovat e and gener at e
new i deas and i ncor por at e t hem i nt o
our wor k, t hen by t he t i me anyone
had copi ed us, we woul d be t hat
 SUSTAINING LEADERSHIP IN STEEL - A SAIL PERSPECTIVE : JAIN
much f ur t her al ong. ”
Wi t hout cont i nuous l earni ng about
t he business, as wel l as about t heir
own t asks, t he empl oyees cannot
cont ribut e what t hey are t ruly capable
of . This requires l earning ef f ort on
part of bot h, t he f ront l ine peopl e,
who are cl osest t o t he pl ace of val ue
addit ion and t he senior managers –
who pl an and perceive t he act ivit ies
i n and ar ound t he or gani zat i on.
Individuals must learn t o act in int erest
of whol e ent erprise and t he senior
managers must l earn t o ext end sel f
mast ery and det erminat ion t hroughout
t he organizat ion. At SAIL, we have
promot ed l earni ng i n subt l e ways,
but t here is a l ong way t o go bef ore
we t r ul y become a l ear ni ng
or gani zat i on. The t heme of t he
recent ly concluded Chairman’ s t rophy
f or young managers (A t op leadership
i ni t i at i ve t o encour age t he br i ght
young mi nds t o cont r i but e t hei r
t hought s on cont emporary issues) was
“ Unlearning and relearning for building
compet i t i ve advant age i n SAIL” .
Ar ound 83 r esear ch paper s wer e
submit t ed by young managers f rom
al l ar ound t he SAIL, and t he
recommendat ions l ike – Knowl edge
Management i ni t i at i ve, Ent er pr i se
Resour ce Pl anni ng, expandi ng
leadership role t o suit t he fut ure needs
and enhancing lat eral communicat ion
t o facilit at e organizat ion wide learning
are being implement ed SAIL wide aft er
a series of del iberat ions.
7 . 0 Fusing Technology and Business
Lear ni ng i s pr equel t o act i on. We
cannot possibl y derive benef it s f rom
our l earning experiences, unt il and
unl ess we put it int o act ion. Whil e
t he mar ket accept abi l i t y and Feature
pr of i t abi l i t y of our pr oduct s and Article
services are our prime concern, we
al so need t o ensur e st r at egi c
i nt er vent i ons i n t er ms of speci f i c
t echnol ogi cal advancement s and
product at t ribut es t hat wil l sust ain
and augment our compet it iveness in
f ut ure. Technology cannot be viewed
onl y as aut omat i on – as machi nes
t hat can save t ime and money. There
i s l i t t l e vi si on t o t hi s perspect i ve.
We need t o explore t he ways in which
t echnol ogy wil l t ransf orm t he work
and creat e a sust ainabl e f ut ure f or
us.
Discussions about t echnol ogy of t en
t urn int o cost benef it anal ysis. The Individuals must
main probl em wit h t his approach is learn to act in
t hat it l imit s t he opt ion. It prevent s
interest of whole
peopl e f rom expl oring t echnol ogical
enterprise and the
t rends. It avoids proj ect ion of what
senior managers must
mi ght happen i f a new i nnovat i ve
t echnology cat ches on or how it might
learn to extend self
change cust omer’ s requirement s. The
mastery and
real chal l enge f or t he organizat ional determination
l eadership in t his cont ext is t o l ook throughout the
beyond t he quot at i on cost benef i t organization.
anal ysis and expl ore new ideas and
t r ends.
Technol ogical l y, t here have been no
maj or breakt hroughs i n process of
st eel making since l ast 5 decades.
SAIL as t he l argest producer of st eel
in India need t o make a subst ant ial
i nvest ment in r esear ch and
development , not only in st eel making
processes, but also in developing new
st eel t o enhance it s compet it iveness.
Al t hough our gr owt h pl an ai ms at
embracing new t echnologies (See t able
3) in areas of ore ref inement , st eel
mel t ing, cast ing and rol l ing, we al so
11
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature need t o use our exper t i se and poor est soci et i es, peopl e r equi r e
Article experience t o t ake st eel making t o secure housing and in areas of high
next generat ion l evel . seismic act ivit y st eel buil dings are
8. 0 Mar ket and Pr oduct t he onl y saf e sol ut ion. Because t he
Development market f or st eel in const ruct ion is so
f ragment ed and suppl y chai n i s so
Hi st ori cal l y, t he st eel i ndust ry has
import ant , t here is great rel uct ance
been poor in it s market devel opment
f or st eel companies t o work t oget her
act ivit ies. In a cost driven business,
t o devel op t he mar ket . It i s not
t here is cont inuous pressure on st eel
somet hi ng t hat can be achi eved
companies t o reduce long t erm market
over ni ght . Peopl e use t r adi t i onal
development act ivit ies. This may help
mat eri al s f or const ruct i on and are
short t erm profit abilit y, but may prove
ver y r el uct ant i n adopt i ng new
t o be disast rous in t he long run. Whilst
mat erial s. The overal l percept ion of
t here are some st eel makers t hat are
st eel as a cost l y mat erial al so act s
cent er s of excel l ence, most st eel
as a maj or det errent . Theref ore,
companies see t hemsel ves as st eel
i t wi l l t ake consi der abl e t i me t o
producer and expect t he product t o
i ncrease t he i nt ensi t y of st eel use
sel l it sel f or, l eave it t o ot her st eel
in const ruct ion, but t he bright side
There are fantastic compani es t o devel op t he mar ket
i s t hat when t hat happens – bot h
new opportunities for which t hey t hen will seek t o capit alize.
t he st eel makers and t he cust omers
steel that are not Wit hout a doubt , t his approach wil l
wil l be immensel y benef it t ed.
being exploited prove t o be suicidal in a market driven
st eel indust ry – where t he rul e of t he Rur al Indi a, wi t h per capi t a
because of failure to consumpt ion of st eel of onl y 2 Kg.
game is t hat t he one who arrives f irst
do good market i s a huge mar ket wai t i ng t o get
usually wins. There are f ant ast ic new
development t apped. The rural sect or, especial l y
opport unit ies f or st eel t hat are not
activities. being expl oit ed because of f ail ure t o i n pr osper ous st at es l i ke Guj ar at ,
do good mar ket devel opment Maharasht ra, Raj ast han and West ern
act i vi t i es. In Indi a, t he gr eat est UP, has buil t up st rong inst it ut ional
opport unit y for st eel is in const ruct ion bases. We need t o buil d up a st rong
and rural areas. dist ribut ion net work, including ret ailers
and sub-ret ailers exclusively f or rural
The use of st eel in resident ial buildings
regions. Current l y t he main use of
and const ruct ion is very l ow. We are
st eel in rural areas is GC sheet s f or
al ready pl agued wit h t he probl ems
roof ing and GP sheet s f or househol d
of def or est at i on and t he r el at ed
and agricul t ural equipment st orage.
adverse ef f ect on our eco-syst em.
But , we need t o widen t he product
Our count ry is running out of t imber.
base and j oi n hands wi t h l ocal
Si mi l ar l y i n ur ban ar eas, t he hi gh
fabricat ors t o manufact ure and market
cost of land requires flexible and speedy
grain silos, st ainless st eel wat er t anks,
const ruct ion. St eel is t he nat ural answer
t ruck bodies, st eel doors, door frames,
t o bot h t hese probl ems and we need
window frames, furnit ure, agricult ural
t o pr omot e t he use of st eel i n
equipment s, st eel scaf f ol dings et c.
const ruct ion aggressively. Even in t he
The idea is t o unlearn –unlearn t hinking

12
 SUSTAINING LEADERSHIP IN STEEL - A SAIL PERSPECTIVE : JAIN
about rural market s in it s st ereot yped
f or m and t ake cogni zance of t he
change i n demands i n pr osper ous
pocket s, t o begin wit h.
Yet anot her avenue where we have
t o change our st rat egy is market ing
st eel as a commodi t y. At SAIL, we
have good pr ocesses, t echnol ogy,
peopl e, management , mar ket i ng
pract ices and a wonderf ul product
mix. So why not posit ion t hat in t he
market pl ace and creat e t he correct
per cept i on i n t he mi nd of t he
cust omer? SAILMA, SAILHARD, SAIL
Jyot i and SAIL TMT bars are some
of our popul ar brands, but we al so
need t o go t o t he mar ket s and
communi cat e t hi s t o our pot ent i al
cust omers. It has been also suggest ed
by t he expert s t o t rain t he chain of
dist ribut ors and ret ailers f or channel
management , so t hat t hey maint ain
t he di sci pl i ne of t he channel -
geographically, t errit orially and price-
wise, and al so ensure t ransparency
of t r ansact i ons.
Final l y, it must be underst ood t hat
t here will be no f ut ure f or st eel unless
our cust omer s and cust omer ’ s
cust omer cont inue t o buy and specif y
st eel . If t he need ari ses, we must
be able t o develop applicat ion specific
product s f or our cust omers. SAIL has
successf ul l y devel oped product s f or
nucl ear appl i cat i ons, boi l er
manuf act ur i ng, moul ded vessel s,
sugar indust ry, f lyover const ruct ions,
wi nd mi l l s, ATM saf es, equi pment s
f or eart hmoving t ool s and payl oads
and def ense sect or. SAIL i s pr oud
t o be t he onl y manuf act ur er of
DMR249A pl at es f or Indi an naval
ai r cr af t car r i er s and DMR249B f or
Indian naval submarines. SAIL is not
onl y t he producer of cl eanest st eel Feature
rail in India, but it has successf ul l y Article
devel oped t hick webbed asymmet ric
rail s as wel l . We are very good at
developing cust omized product which
meet t he r equi r ement of our
cust omers, but l et us, f or a change,
devel op a new product and creat e
an appet it e for it amongst it s pot ent ial
cust omer s.
9. 0 Delight ing Cust omer s
If t here is one t hing about businesses
t hat hasn’ t changed in t hese changing
t imes – it is t he f act t hat cust omers
ar e t he key t o f ut ur e of t he
organizat ion. However, wit h changing
t i mes, t he cust omer s t oo have
changed. Today, cust omers have many
purchase al t ernat ives wit h t he worl d
of inf ormat ion at his f ingert ips. Gone Building better
are t he days, when it was rel at ivel y customer relationship
easier t o at t ract cust omers t hrough is much more
dist inct ive product f eat ures, pricing
difficult than
st rat egies and brand loyalt y programs. building distinctive
A moder n day cust omer val ues
products.
dependabi l i t y, honest y, i nt egr i t y,
cor por at e r eput at i on and mut ual
empat hy. We need t o keep reminding
oursel ves t hat unl ike t echnol ogy or
pr ocess, a cust omer cannot be
managed. Buil ding bet t er cust omer
rel at ionship is much more dif f icul t
t han buil ding dist inct ive product s.
SAIL has t he honor of cat er i ng t o
some of t he most reput ed corporat e
names in Indian and gl obal business.
Indian Railways, t he largest rail net work
of t he worl d and our armed f orces
ar e our val ued cust omer s. Tot al l y
orient ed t owards cust omer care, SAIL
has recent ly int roduced new processes
l ike Key Account Management (KAM)
in it s market ing f unct ions t o f urt her
st rengt hen cust omer rel at i ons and
13
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature provide qualit y service. Wit h long and
Article f l at pr oduct s bei ng mar ket ed by
separ at ed gr oups, cust omer s now
r ecei ve f ocused at t ent i on and
improved services. Every requirement
of key cust omer is fulfilled by specially
f or med gr oups compr i si ng of
market ing and pl ant personnel who
have t he responsibilit y of st reamlining
operat ing f rom order processing t o
order f ul f il l ment . This ensures t hat
cust omer receives t he desired quant it y
and qualit y of supplies in desired t ime.
Al t hough SAIL has a wide cust omer
base and a range of pleased cust omers,
we need t o under st and, t hat our
compet i t ors are gai ni ng on us and
we need t o t ake our cust omer
Employee rel at ionship t o a new l evel . We need
involvement and t o di scover what cust omer s ar e
participation is the t hi nki ng, f eel i ng and needi ng. We
most effective way to al so need to gr asp t he
make employees work int erdependencies bet ween cust omer
smarter and harder and company and be in his/ her shoes.
for their benefit and We al so need t o devel op t hat abil it y
hence for the benefit t o read bet ween t he lines and t ranslat e
of the organization. t he val ue of cust omer i nt o a new
pr oduct or ser vi ce. Or gani zat i on
l eaders need t o f act or t hat visceral
sense of cust omers int o t heir decision
making and est ablish a more int imat e
and t rust ing rel at ionship wit h t heir
cust omer s.
10. 0 Unlimit ed Pot ent ial
SAIL’ s wor k cul t ur e uni quel y
charact erized by pursuit of excellence,
ent er pr i se, l oyal t y, l ear ni ng and
dedicat ion – is replet e wit h posit ivism.
It is t his qualit y t hat helped us survive
t he rough weat hers and i t wi l l be
t he bi ggest weapon i n our arsenal
as we march i nt o t he f ut ure. SAIL
has demonst rat ed t i me and agai n,
14
t hat i t ’ s cr eat i ve, commi t t ed,
ent erprising, l oyal and det ermined
empl oyees have unl imit ed pot ent ial .
SAIL can easil y boast of it s t op not ch
human resource development program
and t he opport unit ies it provide t o
it s empl oyees f or sel f devel opment .
However, wit h changing t imes, t he
expect at ions of our empl oyees t oo
have changed. They are no l onger
j ob secur i t y, f i nanci al r ewar ds or
promot ion at t he cost of qual it y of
life. Their new priorit ies are aut onomy,
i nvol vement , chal l enge, j ob
sat isf act ion and personal growt h. The
message is cl ear:
“ If t he companies don’ t give it , t hey
won’ t get i t ”
Tot al peopl e invol vement is t he need
of hour. The best t hing about employee
participation and employee involvement
is t hat it makes empl oyee f eel a real
sense of wort h in t he organizat ion
and i t gi ves mor e power t o t hem
wi t hi n t he ent er pr i se. Empl oyee
invol vement and part icipat ion is t he
most effect ive way t o make employees
work smart er and harder f or t hei r
benef i t and hence f or t he benef i t
of t he organizat ion. That is why t he
import ance and scope of empl oyee
par t i ci pat i on and i nvol vement ar e
crucial t o t he success of t he ent erprise.
The human r esour ce devel opment
st udi es i n past t wo decades have
cl ear l y est abl i shed t hat a di r ect
rel at ionship must exist bet ween t he
empl oyee and management t o
emphasize individualism and promot e
t eam work f or building a compet it ive
organizat ion t hat can wit hst and rough
weat hers and t roubl ed wat ers.
The leadership requirement s t oo have
 SUSTAINING LEADERSHIP IN STEEL - A SAIL PERSPECTIVE : JAIN
changed wit h changing t imes. Wit h
indust ry evolving at an ever quickening
pace, l eaders are f acing chal l enges
t hat require t hem t o t hink out side
t he box and look f or solut ions in most
unusual pl aces. To be ef f ect ive and
drive business success, l eaders must
use ski l l s t hat ar e f or ei gn t o
“ t radit ional managers” . They must
be f ar - si ght ed vi si onar i es who
cont inual l y l ook f or innovat ive and
creat ive ways t o devel op peopl e and
expand t he business. Pet er M. Senge
i n hi s f amous wor k, The Fi f t h
Discipline, point s out t he skills required
f or l eaders of t he f ut ure :
z The capacit y t o orient t owards
what t hey want t o cr eat e :
Aspi rat i on
z The capacit y t o ref l ect on and
l earn about sel f : Ref l ect ion
z The capaci t y t o engage i n
meani ngf ul communi cat i on:
Conversat i on
z And, t he capacit y t o const ruct
coher ent vi ew of t he whol e:
Concept ual izat ion
Vi r gi n Thomas, Pl ant Manager of
Kel l oggs Lancast er cereal pl ant says:
“ Leader s have t o pai nt a pi ct ur e,
make peopl e bel i eve t hat t he pi ct ur e
i s cor r ect , and t hen dr i ve peopl e
t owar d t hat pi ct ur e. Leader s ar e t he
i ndi vi dual s who ar e wi l l i ng t o l ead
t he t r oops up t he hi l l , so t o speak.
They real ize t hat indust ry is operat ing
i n a changi ng wor l d and t hey must
be capabl e of l eadi ng peopl e t o t he
change. ”
Dave Maxwell Execut ive Vice President
at Brazeway agrees :
“ Leader s ar e t he ones t hat wi l l al l ow
peopl e t o be all t hat t hey can be. They Feature
t end t o pi ck t he best al t er nat i ve and Article
peopl e nat ural l y f ol l ow. Managers are
f ocused on shor t -t er m, i mmedi at e
r esul t s. ”
A challenging piece of t he vision t hat
l eaders must devel op is t he impact
of rapid change. In t he f ace of t his
change, successf ul leaders will be t he
ones t hat rely on ot hers t o help t hem
achi eve desi r ed busi ness r esul t s.
Leaders wil l have t o t ake more of a
coaching role in t he upcoming f ut ure.
Decisions wil l have t o be made by
t hose who are cl osest t o t he work
and workpl ace. The resul t s of t his
t ype of deci si on maki ng: gr eat er
i mpl ement at i on success due t o
i ncr eased buy-i n and pr act i cal i t y.
Leaders al so need t o devot e more
t ime t o f ocus on st rat egic pl anning ... successful leaders
and l ong-t er m goal devel opment , will be the ones that
crit ical f act ors t o business success. rely on others to help
Leaders have got t o give peopl e t he them achieve desired
correct inf ormat ion and t ool s t o do business results.
t hei r j obs. They al so have t o get
peopl e commi t t ed t o t he l i f e-t i me
learning process. Leaders who do not
suppor t and encour age a const ant
learning environment st unt employee
devel opment mi ni mi zi ng t he
cont ribut ions t hey make t o keep a
business ahead of t he compet it ion.
To ef f ect i vel y encour age an
environment of cont inual learning and
accept ance of change, l eaders must
possess and appl y int erpersonal and
t echnical skil l s. In addit ion t o t hese
skills, t he leaders must , “ be st rat egic
t hinkers and innovat ive. They must
t ake calculat ed risks wit hout wait ing
f or t he compet it ion t o make a move.
At t he cusp of t he 21st Cent ury, leaders
15
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature ar e f aced wi t h a gr owi ng l i st of
Article chal l enges: r api dl y changi ng
t echnol ogy, downsi zi ng, gl obal
compet i t i on, and hi gher cust omer
demands. They cannot ef f ect i vel y
handl e t hese demands on t heir own.
Truly successful leaders who t ranscend
t heir t echnical niche or indust ry of
expert ise have t wo t hings in common.
Maxwel l says:
“ Ef f ect ive l eaders hire good peopl e
around t hem and t hen l eave t hem
al one t o do t heir j ob. As a l eader,
you also must have t he abilit y t o keep
yoursel f in perspect ive. ”
11. 0 Sust aining t he Fut ur e
Companies must
For gi ng a st r ong and pr osper ous
integrate social
f ut ure is simpl y not possibl e unl ess
perspective into the
our st rat egi es produce sust ai nabl e
core framework it
weal t h – i. e. creat es product s, goods
uses to understand
and services t hat can be sust ained
competition and socially – and in t urn leads t o general
guide its business wel l bei ng of soci et y i n whi ch i t
strategy by finding operat es. SAIL chai rman, Mr. S. K.
ways to reinforce Roongt a emphasi zes:
corporate strategy by “ We cannot l i ve as an i sl and of
advancing social pr osper i t y. Our per i pher y has t o
welfare. devel op in t andem”
True t o our credo st at ement , we value
t he opport unit y and responsibil it y t o
make a meani ngf ul di f f er ence i n
peopl e’ s l ives. SAIL’ s maj or t ask was
t o spread prosperit y t hrough economic
and social development in and around
al l pl aces where it s pl ant s were set
up. It has been st riving hard t o do
so as an ideal corporat e social cit izen.
SAIL, t hrough it s various peripheral
devel opment al act ivit ies, has been
support ing educat ional charit able and
welfare inst it ut ions wit hin and out side
t he st eel t ownships. These act ivit ies
16
i ncl ude heal t hcar e pr ogr ams,
educat ional init iat ives, promot ion of
sport s and cult ural act ivit ies, ancillary
development , building inf rast ruct ure
l ike roads, providing drinking wat er
and sanit at ion f acil it ies et c. SAIL is
acut ely conscious of it s environment al
f oot pr i nt s. We ar e commi t t ed t o
minimizing t he environment al impact s
of our oper at i ons t hr ough l egal
compl iance, cont inual improvement
and vol unt ary init iat ives.
We ar e movi ng i n r i ght di r ect i on,
but we have t o t ake care t hat our
corporat e social responsibil it y (CSR)
init iat ives do not become cosmet ic
or ornament al i n nat ure. We must
st rive hard t o make our CSR st rat egic
and operat i onal . It i s cl ear t hat a
compet it ive organizat ion needs healt hy
societ y, educat ed workforce, effect ive
ut il izat ion of nat ural resources and
a safe accident free work environment .
In t urn t he communit ies need j obs
and empl oyment , t he weal t h,
prosperit y and improved st andard of
l i vi ng. CSR act i vi t i es must ai m at
mut ual benef i t of communi t y and
t he organizat ion and we need t o f ocus
on t hat common space. Companies
must int egrat e social perspect ive int o
t he cor e f r amewor k i t uses t o
under st and compet i t i on and gui de
it s business st rat egy by f inding ways
t o rei nf orce corporat e st rat egy by
advancing social wel f are.
CSR shoul d al so aim at improving t he
overal l image of company and st eel
as such. SAIL is proud of cont ribut ion
t hat st eel makes in sculpt ing t emples
of modern India. It is indispensabl e
i n t he wel f ar e of t he manki nd.
However, some of t he r ecent l y
 SUSTAINING LEADERSHIP IN STEEL - A SAIL PERSPECTIVE : JAIN

conduct ed st udies indicat e t hat most 12. 0 Conclusion Feature

of t he popul at ion is ignorant of t his The path to future is all about translating Article
cont ribut ion. A poor image of st eel bel ief s int o business. A vision – t hat
in societ y ult imat ely affect s t he choice i s deepl y i ngrai ned i n t he mi nd of
of st eel in product s. A poor image our peopl e and l ooks beyond t he
of st eel in young peopl e af f ect t heir horizon. An opt imism - t hat st ret ches
career choice. A poor image is st eel t he boundar i es of possi bi l i t i es. A
in government af f ect s t he choice of commit ment – t hat is driven by t he
pol icies made on issues which af f ect passion t o excel and a dest inat ion –
our abi l i t y t o serve t he soci et y at t hat is ahead of t he best s of t he best .
l arge. Last l y a poor image of st eel We have al l t he right ingredient s t o
in t he f inancial communit y af f ect s be what we want t o be. However, t his
t he val uat ion of our businesses and pat h is f ul l of unexpect ed chal l enges
avai l abi l i t y of i nvest ment capi t al . and we bet t er st and prepared f or it .
Theref ore, i t i s a maj or chal l enge Our gl or i ous past i s behi nd us as
f or SAIL t o ensure t hat image of st eel we l ook f or war d t owar ds l eadi ng
and SAIL in t he general public mat ches Indian st eel indust ry int o f ut ure.
t he new vision f or st eel t hat we hol d
in indust ry. ... it is a major
Anne x ur e s challenge for SAIL to
Table 1 : Summary of apparent consumption of finished steel
ensure that image of
steel and SAIL in the
Summar y of appar ent consumpt ion of f inished st eel 1 9 9 9 t o 2 0 0 8 general public
( Million Tonnes) matches the new
Re gi o n 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 vision for steel that
Eur opean 152. 9 160. 0 156. 5 156. 7 158. 8 162. 0 164. 0 167. 0 167. 3 166. 5 we hold in industry.
Uni on 25
Eur opean 138. 0 143. 4 140. 0 138. 6 140. 0 142. 5 144. 0 145. 8 146. 2 145. 5
Uni on 15
Ot her Europe 18. 2 22. 1 20. 6 20. 7 24. 1 25. 0 26. 0 27. 0 28. 7 29. 5
For mer USSR 31. 0 38. 8 41. 2 38. 3 43. 4 45. 0 48. 0 50. 0 51. 5 53. 0
NAFTA 142. 4 149. 2 132. 1 135. 1 132. 9 138. 5 141. 5 145. 5 145. 5 143. 5
S Ameri ca 24. 8 28. 1 28. 4 27. 4 28. 1 30. 5 31. 5 33. 5 34. 5 35. 5
Af rica 15. 4 15. 0 16. 3 17. 4 17. 1 17. 5 18. 0 18. 5 19. 0 19. 0
Mi ddl e East 16. 6 18. 4 19. 1 20. 9 21. 6 22. 5 24. 0 25. 5 26. 5 27. 5
PR Chi na 122. 6 124. 6 153. 4 185. 6 230. 9 257. 5 273. 5 284. 0 290. 5 296. 5
Japan 68. 9 76. 1 73. 2 71. 7 73. 8 73. 7 74. 7 75. 0 75. 5 75. 0
Ot her Asi a 109. 0 119. 5 118. 9 129. 5 133. 3 138. 3 140. 8 143. 0 143. 5 145. 5
Asi a 300. 5 320. 2 345. 5 386. 8 438. 0 469. 5 489. 0 502. 0 509. 5 517. 0
Oceani a 6. 7 6. 4 6. 3 7. 1 7. 5 7. 5 8. 0 8. 0 8. 5 8. 5
W O RL D 708. 5 758. 2 766. 0 810. 4 871. 5 918. 0 950. 0 977. 0 991. 0 1000. 0
(Annual report 2007, MEPS Int ernat ional Limit ed)

17
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature Table 2 : Proj ected Plant Wise Production in Corporate Plan 2010
Article
Plant Hot Metal Crude Steel Finished Steel
Bhil ai St eel Pl ant 7. 00 6. 70 6. 20
Durgapur St eel Pl ant 3. 20 3. 00 2. 84
Rourkel a St eel Pl ant 2. 99 2. 80 2. 55
Bokaro St eel Limit ed 6. 50 6. 20 5. 79
IISCO St eel Pl ant 2. 91 2. 50 2. 37
Alloy St eel Plant - 0. 47 0. 43
Sal em St eel Pl ant - 0. 18 0. 36
Visvesvaraya Iron & St eel Limit ed 0. 33 0. 23 0. 22
Total 22. 93 22. 08 20. 76

Table 3 : Plan f or int r oduct ion of new t echnologies in

Cor por at e Plan 2 0 1 0

Description Technology Technologies Corporate

World Over in SAIL plants Plan 2010
BOF st eel Making 100 % 80 % 100 %
Cont inuous cast ing 100% 60 % 100 %
Iron ore benef iciat ion Yes No Yes
Pellet isat ion Plant Yes No Yes
Coke dry quenching Yes No Yes
Top pressure recovery t urbine Yes No Yes
Auxil iary f uel inj ect ion in BF Yes CDI Part ly CDI f ully
Copper st aves (cl osed l oop DM Wat er) Yes Part ly Fully
Desul phurizat ion of Hot Met al Yes Part ly 100 %
Thin Sl ab Cast ing Yes No Yes
Compact st rip mil l Yes No Yes
Round cast er f or wheel s Yes No Yes
Beam bl ank Cast ing Yes No Yes
Coupl ed pickl ing and t andem Mil l Yes No Yes
Hot rol l ed gal vanizing Yes No Yes

18
 SUSTAINING LEADERSHIP IN STEEL - A SAIL PERSPECTIVE : JAIN

Figure: 1: Cost of Iron ore and Coking Coal in US Dollar Feature

per Met ric Ton Article
100

90

80

70

60

50 Ir on Or e
40 Coking Coal
30

20

10

0
June, 04 Dec, 04 June, 05 Dec, 05 June, 06

Bibliography
1. Dani el R. Tobi n: Leadi ng i nt o
t he f ut ur e: A gl obal st udy of
t he l eadership (Annual Journal
of Management , Amer i can
Management Associ at i on)
2. Ian Chri st mas: Worl d st eel : A
common Fut ure: Speech at 4t h
Int er nat i onal St eel Congr ess,
Chi na
3. Ian Christ mas: Speech at India
St eel Summit
4. Pet er M. Senge: The Fi f t h
Discipline
5. IISI: Innovat ions in st eel
6. S. Mazumdar & T. Ghoshal :
St r at agi es f or Sust ai nabl e
t urnaround of st eel Indust ry (IE(I)
Journal MM)
7. Rahim K. Jassim: Compet it ive
Advant age Through Empl oyees
8. Shoeb Ahmed: Perspect ives in
Indi an St eel Market i ng i n t he
Gl obal Scenar i o – (Gr owt h, A
j ournal of MTI, Ranchi )
9. Jouko Harkki: Fut ure t rends in
st eel indust ry
10. Vesa Pihl aj a: Threat s in st eel
indust ry: Environment al mat t ers
11. Mi chal Por t er : St r at egy and
Societ y, Harvard Business review
December, 2006

19
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature Leading for the Future : SAIL Story

Article

Sushim Banerj ee

A few individuals Abst ract

flocked for the The sust ainabil it y of growt h of manuf act uring indust ries highl y depends upon t he speed
purpose of achieving of invest ment in infrast ruct ure indust ries. SAIL has t he compet it ive edge having infrast ruct ure
a goal may select a suppor t f or capaci t y expansi on havi ng i t s own capt i ve sour ce of Raw Mat er i al s. To
leader based on some sust ain l eadership at al l l evel s, SAIL woul d have t o adopt innovat ive business pract ices.
time tested Keywords : Leader shi p, Compet i t i ve, Innovat i ve
characteristics : a role
model, with
unblemished
integrity, ethical
values, good
communication and
above all a team man
who is able to 1 . 0 Leadership Defined per cei ved val ues by t he gr oup
motivate everyone members. This well est ablished norm
Management t ext s have el aborat el y
and navigate the of choosing a l eader regret t abl y f ail s
def ined t he f eat ures and rol e of a
team under difficult quit e of t en and t here have been cases
l eader. A f ew individual s f l ocked f or
circumstances. of hist orical bl under when a l eader
t he purpose of achieving a goal may
occupies t he highest chair by virt ue
sel ect a l eader based on some t ime
of a brut e maj orit y in a parliament ary
t est ed charact erist ics : a role model,
democr acy or muscl e power i n
wit h unbl emished int egrit y, et hical
aut ocr acy. Leader shi p by maj or i t y
values, good communicat ion and above
may al so at t ain l egit imacy wit h t he
all a t eam man who is able t o mot ivat e
help of a series of convenient alliances
everyone and navigat e t he t eam under
which l ast f or a specif ic t ime period.
dif f icult circumst ances. Ext ending t he
The pol i t i cal and economi c
concept , a communit y leader occupies
consequences of such shor t -l i ved
hi s posi t i on based on t he same
l eadership are wel l known.
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

* Execut ive Direct or (HRD), MTI, SAIL, Ranchi

20
 LEADING FOR THE FUTURE - SAIL STORY : BANERJEE
2 . 0 Indust rial Leader
Looki ng asi de, t he concept of
l eadershi p i n a i ndust ri al segment
is much more concise and f ocused.
One has a whol e l ot of measurabl e
paramet ers t o percei ve and sel ect
a l eader of t he segment . The market
per cept i on of a segment l eader
somet imes t ranscends t he measurable
indices and brings in f eat ures t hat
depend on qualit at ive measurement .
The current concern of t he indust ry
on business et hics, corporat e social
r esponsi bi l i t y and envi r onment
management have become t he primary
det er mi nant s f or t he choi ce of a
l eader.
2. 1 Mar ket Shar e : A Pr i mar y
Indicat or
Wit h a marginal l y higher t han
22 per cent of market share,
SAIL cont inues t o enj oy t he st at us
of t he market l eader in Indian
St eel Market . Ot hers are : Tat a
(8. 1) Rasht riya Ispat (6. 0), Essar
(4. 5), Jindal (3. 6), Ispat (5. 0),
Bhusan (1. 6), Import s (8. 9) et c.
Cur r ent l y SAIL i s mar ket i ng
around 10. 1 mt of f inished st eel
i n t he mar ket out of a t ot al
consumpt ion of 45. 5 m. t . Wit h
mor e number of pr oduces
emer gi ng i n t he scene, t he
mar ket shar e of est abl i shed
producers get s t hreat ened and
if t he rat e of growt h of t ot al
consumpt ion goes up at a rat e
higher t han t he growt h rat e of
f i ni shed st eel sal es by an
individual producer, t he market
share of each worl d undergo a
change. This scenario is a dist inct
possi bi l i t y as an i ndi vi dual Feature
producer cannot always plan f or Article
capaci t y expansi on at a r at e
equal t o or more t han t hat of
t he t ot al and one need not get
undul y wary of l osi ng market
share on t hat count .
2. 2 On a f ut urist ic not e, Indian St eel
demand i s proj ect ed t o grow
at an annual average rat e of
not l ess t han 10 per cent per
annum. At t his rat e, t he t ot al
f inished st eel consumpt ion may
reach around 155 m. t . by 2019-
20. At t he current proj ect i on
of 180 – 200 m. t . of crude st eel
pr oduct i on by 2019- 20, t he
f inished st eel product ion in t he The current concern
count ry comes t o approx. 162 of the industry on
–180 m.t . The surplus availabilit y business ethics,
(product ion over consumpt ion) corporate social
can be pl anned as expor t . responsibility and
However, t he sust ainabil it y of environment
st eel demand at a secul ar rat e management have
of 10 per cent per annum i s become the primary
f raught wit h uncert aint y. While determinants for the
GDP growt h in t he recent period choice of a leader.
is quit e signif icant reaching 9. 4
per cent i n 2006- 07, t he
cont i nuat i on of st eel demand
at an annual average rat e of
10 percent per annum hi nges
cr uci al l y on t he gr owt h of
manuf act uring and const ruct ion
segment s. Manuf act uring sect or
has grown by an impressive 12. 3
percent in 2006-07 as against
9. 1 percent in t he previous year
t her eby cont r i but i ng t o a 16
per cent gr owt h i n st eel
consumpt i on i n 2006- 07 as
against 13. 3 percent in 2005-
06. The sust ainabilit y of growt h
21
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature of manuf act uring sect or in t urn
Article depends on t he i nvest ment
t empo in inf rast ruct ure sect or
(Power, Port s, Roads, Airport s,
Pet ro-chemicals. Oil & Gas et c.).
This alone would provide a much
needed boost t o secondar y
sect or ’ s ( manuf act ur i ng,
el ect ri ci t y, gas, wat er suppl y
and const ruct ion) cont ribut ion
t o GDP in place of t ert iary sect or.
This can onl y happen under a
pol i t i cal l y st abl e gover nment
which shoul d work f or a l ower
inequalit y of income and a robust
economic growt h t hat would be
i ncl usi ve wi t h benef i t s of
SAIL has the unique economi c gr owt h per col at i ng
advantage of down t he l owest st rat a of t he
possessing the basic societ y. Agricult ure t hat engages
infrastructure mor e t han 60 per cent of our
required for popul at i on must gr ow at a
brownfield capacity minimum rat e of 4 percent per
expansion as well as annum and manuf act ur i ng
the captive sources of growt h t o generat e employment .
iron ore that provides
2. 3 SAIL has t he unique advant age
a huge competitive
of possessi ng t he basi c
edge. i nf r ast r uct ur e r equi r ed f or
brownf iel d capacit y expansion
as wel l as t he capt ive sources
Company Net sales
2006-07 Growth % 2006-07 Growth % 2006-07 Growth %
St eel Aut horit y
of India Lt d 33923. 12* 21. 79
Tat a St eel Lt d 17552. 02 15. 36
JSW St eel Lt d 8594. 44 38. 27
Jindal St eel &
Power Lt d 3519. 81 35. 89
* Excl uding Excise Dut y, Source: Media report s / Unaudit ed Account s.
22
of iron ore t hat provides a huge
compet it ive edge. One of t he
basi c obj ect i ves of SAIL’ s
Cor por at e Pl an i s t o upgr ade
t echnol ogy, make 100%
product ion t hrough cont inuous
cast i ng and i ncr ease f i ni shed
st eel percent age by drast ical l y
cut t ing down semi-f inished st eel
f or sal e. By 2010- 11 SAIL i s
planning t o increase product ion
of crude st eel f rom t he current
l evel of 13 mt . t o 24. 90 mt .
wit h a f inished st eel component
of 21. 7 m. t . By adding a f resh
greenf iel d expansion of 10 mt .
and ot her brownf ield expansion
amount i ng t o 5 mt . , t he
proj ect ed l evel of crude st eel
by SAIL can be t aken as . 40
mt . by 2019-20. Thi s i mpl i es
t hat by t he end of second decade
of 2000, SAIL woul d mar ket
appr ox. 38. 0 mt . of f i ni shed
st eel which yields a market share
of 22. 3 percent .
Thus in t he l ong t erm al so, SAIL
can remain a leader wit h regard
t o mar ket shar e i ndex t o be
cl osel y f ol l owed by Tat a and
(Rs. In Crore)
Operating Profit Net Profit
10966. 23 48. 58 6202. 29 54. 56
7254. 84 18. 17 4222. 15 20. 41
2812. 95 35. 78 1292. 00 50. 84
1431. 37 35. 66 702. 99 22. 70
 LEADING FOR THE FUTURE - SAIL STORY : BANERJEE
Ji ndal s.
2.4 Hi gh vol ume r ef l ect s hi gh
t urnover. The f ol l owi ng t abl e
summarizes t he producer-wise
st at us f or 2006-07
An organi zat i on wi t h massi ve
t urnover enj oys an excellent edge
over ot hers in t erms of a st rong
bargaining power on pricing of
raw mat eri al s, expandi ng t he
cust omer base and has a maj or
i nf l uence on t he pr i ces of
f i ni shed pr oduct s and t he
rel evant pol icy f ormul at ion by
t he Government . Net prof it as
a percent age of net sal es is a
broad ref l ect ion of t he product
realizat ion. Higher sale of value
added pr oduct s or mar ket i ng
in a val ue-added segment may
onl y add t o prof it s. SAIL needs
t o l ay more emphasi s on t hi s
aspect .
3 . 0 Niche Market
Creat ion of a niche market has
been one of t he f or emost
mar ket i ng st r at egi es of a
successf ul or gani zat i on.
Commensurat e wit h t he product
l i f e cycl e, a cont i nuous and
serious ef f ort on R&D is a pre-
requisit e for compet it ive success.
Hist ory of gl obal st eel indust ry
has ampl y demonst rat ed t hat
many l eadi ng st eel producers
in Nort hern America and West ern
Europe have eit her disint egrat ed
or merged wit h t he newer ones
due primaril y t o t heir inabil it y
t o make dr ast i c changes i n
pr oduct - mi x, or gani zat i on
st ruct ure, raw mat erial sources Feature
t hat t he compet it ive compulsions Article
demanded. Having been confined
t o t radit ional sect ors wit h bloat ed
cost s of product ion and being
out of t une wit h t he changing
pat t ern of demand, many l arge
producers of yest er years have
made inglorious exit . Thus, value
addit ion in t he product range
by ef f ect i ve reengi neeri ng of
t he process and st ruct ure is an
essent ial hal l mark of a l eading
or gani zat i on.
3. 1 Product -wise, SAIL has a maj or
share in HR Coil / Sheet , pl at e
and Railway mat erials and closely
f ol l ows Tat a in CR Coil / Sheet .
In al l t hese pr oduct s new ... value addition in
producers are emerging and are the product range by
l ikel y t o t hreat en t he current effective
market share hel d by SAIL. For reengineering of the
inst ance, new capacit ies in HR process and structure
by Essar, Jindal s, Bhushan and is an essential
Ispat and t he l ikel y addit ion by hallmark of a leading
POSCO & Ar cel or -Mi t t al s may organization.
bring t hem cl oser t o a higher
market share in HR and pl at es.
3. 2 It i s wel l appr eci at ed t hat
mar ket i ng hi gh vol umes i n
or di nar y st andar d gr ade and
hol ding on t o market share in
t radit ional sub-segment s is an
out dat ed st rat egy and shoul d
not f ind pl ace in t he corporat e
mast er pl an of a l eader. There
is an urgent need t o bring qualit y
upgradat ion in t he whole gamut
of pr oduct r ange and i t i s
heart eni ng t o not e t hat most
of t he f ut ur i st i c changes
envi saged i n t he pat t er n of
23
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature
Article
Business ethics,
setting up of a high
standard in dealing
with the public and
conformance to well
laid-out systems and
procedures are some
of the major
hallmarks of a
business leader and
SAIL takes pride in
excelling itself in all
these parameters.
24
demand are bei ng dul y t aken
care of in SAIL’ s modernizat ion
plans. Thus, AP1 grade of sheet s
and pl at es f or t he booming oil
and gas sect or, wide widt h plat es
(4. 5 met er i n t he mi ni mum)
f or shipbuilding and power plant
equipment manufact ures, higher
grades of Boil er qual it y pl at es,
t hinner sizes of col d rol l ed and
gal vanized product s t o cat er t o
aut omobiles, consumer durables,
rural househol ds, col d heading
/ hi gh car bon wi r e r ods f or
f ast ener i ndust ri es, TMT bars
wi t h mor e t ensi l e / yi el d
st r engt h, uni ver sal beam /
par al l el f l ange beam f or
mult ist oried / heavy const ruct ion
and l onger l engt h Rai l s wi t h
i mpr oved pr oper t i es t o cat er
t o high speed / high load bearing
capacit y of rail wagons, higher
grades of CRNO et c. are some
of t he sect or-specif ic demand
t hat woul d be t aken care of in
t he proposed product -mix of SAIL
under modernizat ion. It woul d
enable SAIL t o ent er t hese niche
/ value added market s and enrich
t he product component s. In our
t radit ional sect oral analysis, t he
vol ume of t he product s t o be
market ed by SAIL may not enable
it t o hold on t he current market
share in t he f ut ure as wel l . But
f ur t her anal ysi s of t he sub-
segment s wit hin a broad sect or
woul d r ef l ect t hat SAIL i s
gr adual l y cr eat i ng a mar ked
presence in t he sub-sect or by
havi ng more sal es real i zat i on
and a sat isf ied cl ient el e.
3. 3 The changes i n t hese regards
are al ready perceived. In some
of t he t radit ional segment s like
const ruct ion, even t hough SAIL
market share is much lower t han
t he secondary re-rol l ing sect or,
t he pr oduct qual i t y of SAIL
f et ches a mark-up in t he eyes
of t he consumer and t heref ore
in t he proj ect const ruct ion sub-
segment , t her e i s a mar ked
pref erence f or SAIL mat eri al s
and it s capacit y is f ul l y being
ut i l i zed t o meet pr oj ect
requirement s. There is a need
t o f ur t her r ei nf or ce t hese
st rengt hs and cont inue t o serve
t he mega proj ect s in t he massive
r ebui l di ng ef f or t s cur r ent l y
under way. The t r ust and t he
confidence reposed by t he maj or
proj ect aut hori t i es i n deal i ng
wi t h SAIL ar e t o be f ur t her
car r i ed f or war d. Thi s i s t he
credibilit y of a producer planning
t o l ead f rom t he f ront in t he
f ut ur e. Whenever, t her e i s a
nat ural calamit y and large scale
devast at ion wit h loss of innocent
l i ves, SAIL had al ways come
f orward t o reach st eel (GC sheet
/ TMT Bar s f or house
const ruct ion) at af f ect ed places
l i ke Bhuj , Jammu & Kashmi r
& ot her pl aces.
4 . 0 Business Pract ices
This brings us t o t he t hird crucial
paramet er of t he choice of a
l eading organisat ion. Business
et hi cs, set t i ng up of a hi gh
st andar d i n deal i ng wi t h t he
public and conf ormance t o well
 LEADING FOR THE FUTURE - SAIL STORY : BANERJEE
laid-out syst ems and procedures
are some of t he maj or hallmarks
of a business l eader and SAIL
t akes pride in excel l ing it sel f
in al l t hese paramet ers. St rict
pursuance of st andard met hods
and pract ices irrespect ive of t he
needs of a fast changing scenario
woul d not t ake a commerci al
organizat ion up in t he l adder
very f ast . Being in public sect or,
uni f or mi t y in pr act i ces
par t i cul ar l y i n commer ci al
mat t ers, is much sought af t er
and SAIL has been following t hese
pr act i ces wi t hout any
di scri mi nat i on. In t he comi ng
year s, however, commer ci al
compul si on i n a f i er cel y
compet it ive scenario wit h many
gl obal pl ayers having emerged
on t he scene, may f orce SAIL
t o opt f or innovat ive business
pract ices not exercised hit hert o.
To t he ext ent possi bl e, non-
di scr i mi nat i on, f ai r and
t r anspar ent deal i ngs woul d
cont inue t o guide SAIL’ s pol icy
and t hereby reaf f irm t he f ait h
of t he “ Aam Aadmi” t o approach
SAIL f or meet ing t heir needs.
4. 1 This is where t he issue of rural
penet r at i on comes i n. It has
now been st rongly felt t hat urban
concent rat ion of st eel use would
not t ake t he count ry much ahead
and India’s rural populat ion must
be exposed t o st eel use. The
massive pot ent ial hidden in t he
rural and semi urban areas in
t erms of st eel use in rural roads,
bridges, communit y buil dings,
hospi t al s, school s and houses Feature
can be t apped so t hat st eel Article
consumpt ion in t he count ry is
pr ogr essed si gni f i cant l y. It i s
hear t eni ng t o not e t hat SAIL
has al r eady embar ked on
cr eat i ng a wi de suppl y chai n
net work t hroughout t he count ry
f or reaching st eel at t he remot e
par t s. Thi s i s a uni que
exper i ment cover i ng al l 604
di st r i ct s of t he count r y wi t h
appoint ment of at least one small
dealer in each dist rict t o inst ant ly
meet maj or rural requirement s
of galvanized st eel and reinforced
bar. SAIL has appreciat ed t hat
sheer avail abil it y of basic st eel
... non -
in l imit ed t onnages is t he f irst
discrimination, fair
st ep t owar ds maki ng r ur al and transparent
populat ion aware of t he benefit s dealings would
of st eel use. The af f ordabil it y continue to guide
of st eel in comparison t o locally SAIL’s policy and
avail abl e and ot her compet ing thereby reaffirm the
mat er i al s l i ke concr et e, faith of the “Aam
al uminum, asbest os, PVC et c. Aadmi” to approach
is t aken int o account by of f ering SAIL for meeting
various incent ives t o t he dealers their needs.
who woul d act as t he agent of
change and ambassador of SAIL
product s and woul d go a l ong
way t owards creat ing a brand
image f or SAIL wit h abundant
mi l eage in cor por at e
communicat ion and publ icit y.
5 . 0 In t his age of knowl edge-based
economy and f r ee f l ow of
i nf or mat i on, t he gr owt h of
indust ry is inseparably linked wit h
t he wel l being of t he societ y.
Pure obsession wit h commercial
success can per si st f or some
25
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature t ime f or a small player. A leading 6 . 0 Conclusion

Article or gani zat i on wi t h an eye f or
To ret ain t he rol e of a l eader
t he f ut ure must cont ribut e f or
in t he most dynamic and f ast
t he larger int erest of t he societ y.
changing environment like st eel
Corporat e social responsibil it y
is a dif f icul t proposit ion. The
i s t o become an essent i al
market is going t o be ext remely
compet ent of t he gr owt h
demandi ng wi t h hi ghest l evel
st r at egy of a l eadi ng
of cust omer ser vi ce. Indi a i s
organizat ion. SAIL has al ready
al r eady on t he t hr eshol d of
made el abor at e pl ans i n t hi s
globalizat ion where every ot her
regard by adopt ing model village
count r y i s eyi ng t he Indi an
devel opment programmes and
market f or it s vast pot ent ial .
var i ous ot her per i pher al
The t ask of int egrat ing t he rural
devel opment wor ks i ncl udi ng
economy wit h t he f ast pace of
l aying down of wat er pipe l ines
ur bani zat i on r equi r es a
t o r emot e ar eas, bui l di ng of
met amorphosis of cult ural values
school , communit y and heal t h
and aspirat ions. SAIL as a market
cent er s, r ur al houses,
SAIL as a market l eader i s f ul l y gear ed up t o
pr ogr ammes f or woman
gal vanize it s manpower t o be
leader is fully geared empowerment , suppl y of st eel
at t he t op of t he waves of
up to galvanize its bul l ock car t s i n vi l l ages,
changes while f ulf illing it s social
manpower to be at promot ion of sport s act ivit ies,
r esponsi bi l i t y as a gr eat
the top of the waves sani t at i on pr ogr ammes et c.
cor por at i on.
of changes while
fulfilling its social
responsibility as a
great corporation.

26
 TRANSFORMATION LEADERSHIP - THE INNER EXPERIENCE : SHASHANKANANDA

Transformation Leadership : The Inner Feature

Experience Article

Swami Shashankananda*

Abst ract
Man is a personif icat ion of int el l ect ual and rat ional t hinking shaped by educat ion which
gi ves hi m knowl edge and moul ds hi s per sonal i t y and not a machi ne as cl ai med by
Tayl or & Gl i br et h. The spi r i t ual knowl edge of At man and mer ger of t hr ee gunas l eads
t o t he achi evement of t r ansf or mat i on l eader shi p whi ch ai ms at sel f enl i ght enment
and over al l posi t i ve gr owt h. Thus management i s a mani f est at i on of spi r i t ual i t y and
... to manage man is
ar t at one hand and sci ent i f i c t echni ques at anot her.
an art and as well as
Key Words : Management , Per sonal i t y, Leader shi p a science which has
much less to do with
academic approach
but an approach
beyond that.

Product ivit y becomes t he measuring or Non-Govt . Of f ice, t here is one or

scale of t he growt h and development more Execut ives who manage man,
or t he st rengt h of an indust ry or a money, mat er i al , machi nes and
company. It can be done by various market ing. It needs an Execut ive wit h
syst ems of Management . But in al l qual it ies of Management . Managing
syst ems we f i nd t hat i ncr ease i n machi nes, mat er i al , money and
product ivit y depends upon Man, Money, market ing need some t echnical and
Machi ne, Mat eri al and Market i ng. managerial skil l onl y. But t o manage
man is an art and as wel l as a science
Who manages a Company ?
whi ch has much l ess t o do wi t h
In every Inst it ut ion whet her it is a academic approach but an approach
company, f act ory, bank or any Govt . beyond t hat . It needs an enl ight ened

○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

* Secret ary, Ramkrishna Mission Ashrama, Morabadi, Ranchi

27
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature per sonal i t y. An awakened, nobl e,
Article ef f i ci ent person of commi t ment .
Let us now t r y t o under st and t he
devel opment s i n t he f i el d of
Management Syst em in t he past and
t ake l essons f rom t hese experiences
t o choose a right st rat egy.
F. W. Taylor,t he fat her of t he scient ific
Management was of t he opi ni on
that
z The st rengt h of an organizat ion
is it s product ivit y.
z Product i vi t y can be i mproved
endlessly.
z Decline in product ivit y can also
be improved endl essl y.
To achieve the highest z Decl ine in product ivit y makes
productivity, all suffer – t he individual, worker
management is the Group, and Nat ion at l arge.
efficiency in using Tayl or t reat ed Man as machines, raw
Man power, Land, mat erial s and ot her sources. . In t he
Machines, Raw pr ocess of achi evi ng maxi mum
materials and other product i vi t y he consi dered Man as
sources. purel y a physical ent it y. To achieve
t he highest product ivit y, management
is t he ef f iciency in using Man power,
Land, Machines, Raw mat erial s and
ot her sources. He t hought t hat machine
works best when wel l – l ubri cat ed
and well maint ained. Similarly workers
would work best if provided wit h good
working condit ions, wel l t rained and
properly paid. Frank Glibret h’s syst em
Management al so shared t he same
opi ni on.
But man is not a machine or dead
insent ient mat t er. It can not be dealt
l ike machine and mat erial . Even a
worm i s bet t er t han a machi ne. A
huge l ocomot ive has rushed on over
28
t he l ine and a smal l worm t hat was
creeping upon one of t he rail s saved
it s l if e by crawl ing out of t he pat h of
t he l ocomot ive. Yet t his l it t l e worm,
so insignif icant t hat it can be crushed
in a moment , is a l iving somet hing,
whi l e t hi s l ocomot i ve, so huge, so
i mmense, i s onl y an engi ne, a
machi ne. You say t he one has l i f e
and t he ot her is onl y dead mat t er
and al l it s power and st rengt h and
speed ar e onl y t hose of a dead
machine, a mechanical gadget .
To be more f ree i s t he goal of al l
our effort s, for only in perfect freedom
can t here be perf ect ion. This ef f ort
t o at t ain f reedom underlies all f orms
of evol ut i on - physi cal , ment al ,
intellectual, social, cultural, educational
and spirit ual - down f rom t he Darwin’s
Theory of Evol ut ion t o t he Highest
Phil osophy of l if e int ernal , whet her
we know it or not . Man is t he highest
physi cal f orm of l i vi ng bei ng and
superior t o al l ot her beings
Nature of Human Personality
z Let us now di scuss what we
under st and by ‘ MAN’ . Man i s
super i or t o any ot her l i vi ng
bei ng.
z What makes him dif f erent f rom
ot her bei ngs ?
z Is Man onl y as he appears i. e.
t he physi cal body or does he
has some ot her dimension ?
z Does man dies wit h t he deat h
of a body ?
z What is t he purpose of t his l if e?
Manomaya-kosha
z Man t hen merges in Mind and
 TRANSFORMATION LEADERSHIP - THE INNER EXPERIENCE : SHASHANKANANDA
senses which it s subt l e body is.
Thi s mi nd proj ect s t he worl d
of dreams. The subt l e senses
exper i ence dr eam. We see
people, animals, roads, buildings
and what not .
z This is t he emot ional dimension
of Man. It experiences pain and
pl easur e, l ove and hat r ed,
appreciat ion and condemnat ion.
z Act ual l y it is not t he body t hat
experiences anyt hing, it is mind
when at t ached wi t h any part
of t he body t hrough senses it
experi ences.
Vigyanmaya-kosha
z The Int el l ect r ecogni zes and
cert if ies what he sees, hears,
t ouches, t ast es or smel l s in t he
dream. This int el l ect al so is a
sheat h but not t he Real Man.
z Chit t a is t he memory. When he
comes out of t he dr eam, he
remembers al l what happened
i n t he dream.
z That shows t hat t hough he was
separat e f rom body but mind,
senses and int el l ect and Chit t a
were wit h him in dream.
z Thi s i s t he Psychi c di mensi on
of Man.
z Thi s Psychi c body (Sukshma-
sharira of mind wit h 5 senses,
Int ellect , Memory and ego) does
not die wit h t he deat h of t he
gross body.
Physical personality may be a loving,
beautiful and attractive but he may
be a Fool
z A young man/ woman wit h robust
and ver y heal t hy body, wi t h Feature
handsome/ beaut if ul at t ract ive Article
appearance may be put t ing on
nice dress, but if he/ she is not
educat ed his human personalit y
remains at zero at physical level.
This personal it y is not bet t er
t han an animal or a bird. Ahaar
nidra bhaya mait hunamcha, t his
is t he nat ure of animal al so . He
is t o be educat ed.
z Moreover t he physi cal beaut y
perishes wit h t he age. It is very
t empor ar y.
z Man has Psychi c body behi nd
t hi s physi cal body. He needs
educat i on si nce he has t hi rst
f or knowl edge. Knowledge the fruit
Which Educat ion makes Human of Education is
Personality ? power. The Education
that makes us weak,
Today we consi der a man
educat ed if he has a universit y degree. fearful, nervous, a
Thi s educat i on br ought by Lor d life of tension and
Macauley is negat ive educat ion which frustration is no
does not enabl es a man t o st and on education.
his own f eet and does not provide
st rengt h t o f ace t he st ruggl es of l if e.
Knowl edge t he f ruit of Educat ion is
power. The Educat i on t hat makes
us weak, f earf ul , nervous, a l if e of
t ension and frust rat ion is no educat ion.
z A man/ woman may be wel l
educat ed, but if he/ she has no
manners t o t al k wit h ot hers or
has no sweet ness in his t al ks,
i f he i s not gent l e i n nat ur e
hi s per sonal i t y i s ver y l ow
because t he educat ion aims at
humi l i t y “ Vi dya dadat i
vi nayam” He i s st i l l i gnor ant .
Educat ed means a man of
29
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature char act er and possessor of ot hers, Job sat isf act ion and so
Article human val ues on.
It is not money t hat makes Personalit y This t ransformat ion in t he Management
but cont ent ment syst em based on Psycho- soci al
considerat ion needs TQM as managers
z He/ she may be earning crores
wi t h t r ansf or mat i onal l eader shi p
per mont h i n a busi ness or a
at t i t ude.
very high sal aried person or on
a very hi gh responsi bl e post . Leader is a bet t er word in pl ace of
But richness or a high post or Manager or Execut i ve
worl dl y st at us does not make
z Thi s word awakens t he sense
a man happy. We observe many
of part icipat ion in t he workers,
rich peopl e commit t ing suicide
i nspi r at i on f or j oi nt ef f or t s,
or l eading a miserabl e l if e f ul l
t eam spi r i t and i nt ense
of f rust rat ion, t ension, suicidal
involvement of ot her colleagues.
A virtuous Leadership t endency and al ways shedding
t ear s. z It el i mi nat es t he vi ces of
is based on Principles Employer employee relat ionship
and leads to the z He is not poor who has no money
or t he bossi ng at t i t ude of
growth, development but he who has money but go
Manager and f earf ul , avoiding,
and welfare of the f or br i ber y. Ri chness i s
crit icizing and non-cooperat ing
human society, but a cont ent ment (Sant osha)
at t it ude of t he subordinat es.
vicious leadership is Industry is a Human Organization
z An Execut i ve or Manager i s
based on self-vested
z Pr act i ci ng Manager OLIVER appoint ed by order and is obeyed
interest or sense-
SHELDON sai d Indust r y i s in f ear but a l eader is f ol l owed
enjoyment and leads
pr i mar i l y a HUMAN by f ait h and conf idence.
the human society to ORGANISATION.
contraction, Who is a Leader?
narrowness and z This psychic dimension of ‘ man’
Leadership may be Const ruct ive or
misery. t ranscends t he ani mal nat ure
dest ruct ive. It is det ermined by t he
of man. Her e he i s a soci al
virt uous or vicious obj ect behind t he
ani mal . He has a mi nd and
act ivit y and t he qualit y of t he leader.
int ellect .
A vi r t uous Leader shi p i s based on
z He is creat ive. He has f eel ings
Principl es and l eads t o t he growt h,
and emot i ons. He has
devel opment and wel f ar e of t he
imaginat ions. He has t ast e and
human societ y, but a vicious leadership
choi ce. He has power of
i s based on sel f -vest ed i nt erest or
independent t hinking, decision
sense-enj oyment and leads t he human
maki ng, pl anni ng, and
soci et y t o cont ract i on, narrowness
i mpl ement at i on.
and mi sery.
z He want s f r eedom t o wor k,
z We al ways have t he t endency
part icipat ion, sel f -respect and
t o put our t roubl es as coming
dignit y, a good behavior f rom
f rom somebody el se. Especial l y

30
 TRANSFORMATION LEADERSHIP - THE INNER EXPERIENCE : SHASHANKANANDA
in modern civil izat ion t o-day,
t his is a common and const ant
at t i t ude of mi nd: al ways
complaining against t his sit uat ion
or t hat person. And t hen comes
resent ment s one af t er anot her.
Whol e of our energy is wast ed
and we are poor managers or
poor leaders. Failure is t he f at e.
But f i nd a way out t o wor k
successfully and efficient ly under
all circumst ances. Blame yourself.
Fi nd f aul t s wi t h your sel f and
correct it . Transf orm yoursel f
f i r st .
Three gunas- Sattva,Rajas and Tamas
z Supreme Real it y has no f orm,
no gunas (Qual it y) and Prakrit i
( Nat ur e) i s Hi s power who
creat es t his Universe wit h t he
help of t hree gunas-Sat t va, Raj as
and Tamas born out of Prakrit i.
z “ Ni badhnant i Mahabaho Dehe
Dehi nam avvyayam. ” —These
t hr ee gunas keep t he human
bei ngs cont r ol l ed and i n
bondage. Under t he inf luence of
t hese gunas one f orget s one’ s
own Real Nat ure.
One shoul d underst and t he inf l uence
of t hese gunas on one’ s own nat ure
and behavior.
TAMAS
z Know Tamas t o be bor n of
Ignorance. It is a t ype of delusion
f or embodi ed bei ngs t hr ough
t hr ee par t i cul ar moods : 1.
Pr amada - want of at t ent i on
and al ert ness. 2. Al asya - sense
of t iredness. 3. Nidra - sl eep
z Peopl e inf l uenced by t his guna
due t o inert ness remain inact ive, Feature
no int erest in any work.Smart ness Article
and ef f iciency is zero. He has
no vision-deluded and conf used.
RAJAS
z This guna makes one at t ached
t o act i on. Desi r e i s t he r oot
of act ion. When it predominat es
t hen one has an urge “ I must
do somet hing” . A rest l ess mind
i s t he r esul t . Unr est , gr eed,
act ivit y, t ension, worries, anger
et c. are t he f rui t s.
z Such man cannot t ake r i ght
decisions and have no energy
l ef t t o impl ement his work in
a bet t er way.
Sri Ramakrishna
SATTVA
used to say that if a
z It makes at t ached t o happiness man has worked with
and knowl edge. Such a man is 25% mind in work
enlight ened one. He is calm quiet and 75% in God, he
and balanced mind. He can t ake would do much more
right decisions. He reserves his efficiently than him
energy in impl ement ing t he j ob who has done with
given t o him perfect ly, efficient ly whole mind.
wit h one point ed mind and always
succeeds in achieving his aim.
Sat t va-predominant Personalit y
i s t o be achi eved by t he
Transf ormat ional Leadership.
Al l human beings have al l t he
t hree gunas in t hem but t here
may be a predominance of one
guna or t he ot her.
Tr ansf or mat i onal dynami c
Leadership would be t he out come
of sat t va- pr edomi nant
personal it y. He is t o be caref ul
t o keep Sat t va guna cont rol l ing
hi s Raj as and Tamas. Sr i
Ramakrishna used t o say t hat
31
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature if a man has worked wit h 25%
Article mind in work and 75% in God,
he woul d do much mor e
ef f i ci ent l y t han hi m who has
done wit h whol e mind.
The Man beyond t hree Gunas
z Ther e ar e Tr anscendent al
Personal it ies who are al ike in
Pain and Pl easure, Sel f abiding
(swa-st ha) . They regard a cl od
of eart h, a st one and gold alike.
They are same t o agreeable and
disagreeabl e event s.
z He/ she i s sai d t o have gone
Leadership that beyond t he gunas who is same
brings transformation in honour and disgrace, same
in the people around, t o Foe and Friend and who has
which brings a rel inquished al l undert akings.
change in the attitude The knowl edge of t his At man is t he
of the people and most powerf ul weapon t o dispel al l
aims at the growth t hat l owers t he personal it y of Man
and development of and gr ows hi m i n t o a man of
the society or an charact er. This spirit ual st rengt h makes
Organization or a a man dynamic, efficient and excellent .
It given t he power of right imaginat ion,
Company and even a
right decision, right t hinking, t o move
family is
on t he right pat h developing t he sense
Transformational
Leadership. of dut y, cal m and unsel f ish, here t he
mot ive force behind t he work is higher.
Management is very much concerned
wit h t he behaviour guided by spirit ual
f orce. It can not be by l egisl at ure,
police f orce, punishment s, scolding,
or even beat ings.
It is also not a good met hod of inducing
behaviour in Self or in ot hers t hrough
f ear – Fear t o ones social and religious
emot ions –Fear of Police, social Boycot t
or going t o Hel l .
The posit ive and hel pf ul met hod is
t he sense of sel f r espect . Just as
32
we t el l a chil d t his conduct of yours
i s not f i t f or you. I expect you t o
be bet t er. Moder n psychol ogy
recognizes self regard or self respect
as t he foundat ion of charact er building.
Wi t h t hi s spi ri t ual st rengt h of t he
knowl edge of At man, we can achieve
t he best met hod of management ,
Transf ormat i onal Leadershi p
z Leader shi p t hat br i ngs
t r ansf or mat i on i n t he peopl e
around, which brings a change
in t he at t it ude of t he peopl e
and ai ms at t he gr owt h and
devel opment of t he societ y or
an Organizat ion or a Company
and even a f ami l y is
Tr ansf or mat i onal Leader shi p.
The j ourney is ment ioned in t he
script ures as f ol l ows:
z Asat o ma sadgamaya
z Tamaso ma Jyot i r gamaya
z Mr i t yo ma amr i t am gamaya
z Let us march f rom Unt rut h t o
Tr ut h, Dar kness t o Li ght and
Mort al it y t o Immort al it y .
KUTASTAWA KASMALM IDAM VISAME
SAMUPASTHITAM.
ANARYAJUSTAM ASVARGYAM
AKIRTIKARAM ARJUNA.
It brings t he sense of dut y, t he sense
of l oyal t y. In sit uat ion when we are
puzzl i ng, can’ t deci de what t o do
or what not t o do. This sl ok a very
power f ul weapons t o r emove
weakness.
Ment al st rengt h and int ense calmness
is t he f irst condit ion of Management .
Because I am t he At man of al l
 TRANSFORMATION LEADERSHIP - THE INNER EXPERIENCE : SHASHANKANANDA

Ishavasyami dam sar vam yat ki ncha MIRMAMO NIRAHAMKARAH Feature

j agat yam Jagat (Isha Upanishad ch-
1. 1) .
Unit y of al l soul . This Met aphysics is
t he basis of al l et hics, which is t he
some of al l human rel at ionship.
ADVESTA SARVA BHUTANAM MAITRAH
KARUNA EVA CA.
SAMADUHKHASUKHAH KSAMI. Article
Wi t h t hi s spi ri t ual st rengt h of t he
knowl edge of At man, we can achieve
t he best met hod of Management ,
and a good Tr ansf or mat i onal
Leadershi p.

Mental strength and

intense calmness is
the first condition of
Management.

33
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature Leading Through Customer Service : The ICICI

Article Bank Way

Dr. Alok Kumar Rai*

Abst ract :
In t he age of f ast changi ng mar ket dynami cs i n t he banki ng i ndust r y, st i cki ng t he neck
Technological out has become mor e and mor e compl ex. It had been mor e compl ex f or a pr i vat e bank
advances have as t her e ar e a l ot s of suppor t pr ovi ded t o publ i c sect or bank. ICICI Bank has been one
resulted in the death t hat f ound t he way out and key was wi t h t he cust omer s of t he bank. The bank pur sued
of distance, time and t he pol i cy of keepi ng t he cust omer happy and i n a ver y shor t per i od of t i me, i t became
location and second l ar gest bank of t he count r y. The bank i s a r ol e model f or many of t he new
liberalization and banks. The pr esent paper at t empt s t o el abor at e t he cust omer cent r i c i ni t i at i ves t aken
globalization have led by ICICI Bank whi ch made i t l eader i n Indi an banki ng space and i s t aki ng t he bank t o
pl aces.
to reduce barriers to
entry, shorter strategy Key Words : Cust omer Ser vi ce, Ini t i at i ves
and product cycles,
commoditisation of
products and
increased
competition.

INTRODUCTION of product s and increased compet it ion.

The f or ces of gl obal i zat i on,
l i ber al i zat i on and t echnol ogy ar e
f undament al l y changi ng t he gl obal
economic order. Technological advances
have result ed in t he deat h of dist ance,
t ime and l ocat ion and l iberal izat ion
and gl obal izat ion have l ed t o reduce
bar r i er s t o ent r y, shor t er st r at egy
and product cycles, commodit isat ion
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○
These f act ors have impact ed f inancial
ser vi ces mar ket consi der abl y and
coupl ed wit h t he rapid evol ut ion of
t he elect ronic world have led t o easier
product ion and gl obal dist ribut ion of
al l f inancial services.
The Indian financial sect or is impact ed
by t hese development s. The f inancial
sect or ref orms over t he past decade
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

* Reader, Facult y of Management St udies, BHU, Varanasi

34
 LEADING THROUGH CUSTOMER SERVICE - THE ICICI BANK WAY : RAI
coupled wit h t he impact of t he above
ment i oned uni ver sal f or ces have
resul t ed in a great er int egrat ion of
t he Indian f inancial market s wit h t he
global market s. As a result , t he Indian
f inancial sect or part icipant s are al so
seeking a new f ramework t hat has
emer ged acr oss t he gl obe t hat
successf ul l y addresses t he needs of
t he highl y compet it ive and rapidl y
changing environment is t he Universal
Banking Model. This Universal banking
Model will provide a clut ch of services
f r om r et ai l and cor por at e banki ng
t o indust rial l ending, invest banking
t o insurance. ICICI Bank has emerged
as t he t orch bearer in t he indust ry
and has proved t o be a t rue l eader.
The bank has at t ained t his leadership
posi t i on out of sheer emphasi s on
cust omer ser vi ce and made ot her
market pl ayers real ize t he power of
cust omer and t he advant ages a
company can achi eve by ser vi ci ng
cust omer bet t er.
ICICI BANK: THE CHANGE LEADER
ICICI was f or med i n 1955 at t he
i ni t i at i ve of t he Wor l d Bank, t he
Gover nment of Indi a and
represent at i ves of Indi an i ndust ry.
The principal obj ect ive was t o creat e
a devel opment f inancial inst it ut ion
f or providing medium-t erm and long-
t er m pr oj ect f i nanci ng t o Indi an
busi nesses. In t he 1990s, ICICI
t r ansf or med i t s busi ness f r om a
devel opment f i nanci al i nst i t ut i on
of f er i ng onl y pr oj ect f i nance t o a
diversif ied f inancial services group
of f ering a wide variet y of product s
and services, bot h direct ly and t hrough
a number of subsidiaries and affiliat es.
One such affiliat e was ICICI Bank which
was original l y promot ed in 1994 by Feature
ICICI Li mi t ed, an Indi an f i nanci al Article
inst it ut ion, and was it s wholly owned
subsidiary. The name “ The Indust rial
Credi t and Invest ment Corporat i on
of India Limit ed “ was l at er changed
t o “ ICICI Li mi t ed” .
ICICI Bank has been l eading f rom t he
f ront . Once devel opment f i nanci al
inst it ut ion is t oday of f ering a wide
range of banking product s and financial
ser vi ces t o cor por at e and r et ai l
cust omers t hrough a variet y of delivery
channel s and t hrough it s special ised
subsidiaries and af f iliat es in t he areas
of i nvest ment banki ng, mer chant the Indian financial
banki ng, commer ci al banki ng, l i f e sector participants
and non- l i f e i nsur ance, vent ur e are also seeking a
capi t al , asset management and
new framework that
inf ormat ion t echnol ogy. ICICI Bank
has emerged across
is India’ s second-l argest bank wit h
the globe that
t ot al asset s of over Rs. 1 t ril l ion and
successfully addresses
a net wor k of about 540 br anches
the needs of the
and of f ices and over 2, 000 ATMs and
l argest cal l cent er wit h 1700 seat s.
highly competitive
and rapidly changing
As a part of it s endeavour of being environment is the
t he change leader, t he bank int roduced Universal Banking
several new t hings f or t he f irst t ime. Model.
To name f ew are as f ol l ows:
z ICICI was t he f irst int ermediary
t o move away f rom single prime
rat e t o t hree-t ier prime rat es
st ruct ure and int roduced yiel d-
curve based pricing.
z ICICI became t he f i r st Indi an
Company i n Indi an Fi nanci al
sect or t o rai se GDR.
z ICICI becomes t he f irst Indian
Company t o l i st on t he NYSE
t hrough an i ssue of Ameri can
Deposi t ary Shares.
35
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature z ICICI Bank became t he f i r st
Article commercial bank f rom India t o
l ist it s st ock on NYSE.
z ICICI l aunched ret ail f inance -
car loans, house loans and loans
f or consumer durabl es.
ICICI BANK : LEADERSHIP THROUGH
CONSOLIDATION
Many of t he devel opment f i nance
inst it ut ions (DFIs) creat ed wit h t he
int ent ion of providing f inance t o long-
t er m i nf r ast r uct ur e t o st i mul at e
indust rial act ivit y t hrough l ong-t erm
concessional loans, have become beast s
of bur den saddl ed wi t h huge non-
perf orming l oans (NPLs) as a resul t
In the liberalised and
of t he l egacy of t he past . In t he
deregulated financial
liberalised and deregulat ed f inancial
sector, distinctions sect or, di st i nct i ons bet ween
between commercial commercial banking and invest ment
banking and banking have been blurred and a st and
investment banking alone t erm-lending inst it ut ions st ood
have been blurred at a seri ous di sadvant age.
and a stand alone
The bank was quick t o recognize t hat
term-lending t he advent of universal banking would
institutions stood at a l ead t o gradual decl ine and demise
serious disadvantage. of t erm-l ending inst it ut ions in India.
ICICI Bank real ized very earl y t hat
t he key woul d be in t he size, hence
t he bank went in f or a consol idat ion
drive in t he indust ry. ICICI Bank has
been leading t he wave of consolidat ion.
In 1996 ICICI merged SCICI.
In 1997 ICICI t ookeover ITC Cl assic
Fi nance.
In 1998 ICICI t ookeover Anagr am
Fi nance.
In 2000 ICICI Bank merged Bank of
Madura. This merger has given t he
bank, t he advant ages of a l ar ger
bal ance sheet si ze, ext ensi ve
36
geographic reach t hrough enhanced
branch net work, increased cust omer
base wit h cross-selling opport unit ies,
increased t hreshold t o f inancing small
and medi um ent er pr i ses ( SME)
segment s and an oppor t uni t y f or
expandi ng agr o-based l endi ng and
micro credit . More specif ical l y, t he
mer ger has enabl ed ICICI Bank t o
gain an addit ional cust omer base of
12 l akhs.
In 2002 ICICI r ever se mer ger wi t h
ICICI Bank t ook pl ace . This reverse
merger move heralded a new chapt er
in t he Indian banking sect or. The new
ent it y wit h asset s of over Rs 95, 000
crore became t he second largest af t er
St at e Bank of India. The bank was
sure t hat t his would creat e t he opt imal
l egal st ruct ure f or t he ICICI group’ s
universal banking st rat egy.
In 2002 ICICI Bank merged ICICI Capit al
Services Lt d and ICICI Personal Financial
Servi ces Li mi t ed.
ICICI BANK: LEADER IN RETAIL
BANKING
Bank is f ul l y aware of t he pot ent ial
l ying in t he ret ail market of banking
pr oduct s and ser vi ces. Consumer
f i nance i s gr owi ng at 60% CAGR
(Compounded annual growt h rat e).
The f i gur e of t hi s i s expect ed t o
cont inue t o be around Rs 75,000 Crore.
This has become new driver of t he
economy. The bank f eel s t hat over
t he years, banks have been f unding
pr oduct i on, t hey never f unded
consumpt ion. Besides, bank also knows
t hat credi t penet rat i on i n Indi a i s
j ust 2%of GDP against 20%in Sout heast
Asi an Count ri es.
Thi s has f or ced ICICI bank t o go
 LEADING THROUGH CUSTOMER SERVICE - THE ICICI BANK WAY : RAI
aggressively f or ret ail business. Ret ail
business not onl y in f orm of ret ail
f inancing but al so in ret ail deposit s
as ret ail deposit s are considered t o
be cheaper by at least 200 basis point s.
At t he t ime of merger of ICICI and
ICICI bank, t he ret ail deposit s were
cont r i but i ng 30 % whi l e r est 70 %
used t o come from corporat e deposit s,
which has now been reversed, and
ret ail deposit s const it ut e 60% whil e
corporat e deposit s and bonds const it ut e
onl y 40%. The banks ret ail market ing
has proved t o be quit e f ruit f ul . On
t he ret ail l ending side, ICICI bank is
market leader in credit cards business,
#1 in aut o l oan #1 in onl ine t rading
and is moving very f ast in home l oan
segment . Now t he bank is t arget ing
at cross sel l ing t hrough which bank
knows it wil l cut down it s cust omer
acquisit ion cost massivel y. For, bank
i s cont i nuousl y br i ngi ng out new
product s.
ICICI Bank, i n t he recent past has
f ol l owed t he st rat egy of buil ding up
it s ret ail presence and diversif ying
away f rom proj ect f i nanci ng. ICICI
Bank in 2006-07 has over 14 mil l ion
ret ail cust omer account s. Ret ail Loan
comprises of over 65%of ICICI Bank’ s
t ot al l oan port f ol io.
ICICI BANK: LEADERSHIP THROUGH
CUSTOMER SERVICE
Cust omer Ser vi ce i n ICICI Bank
essent ially focuses on providing opt imal
val ue t o cust omers t hrough t he way
t he bank communicat es wit h t hem,
how it sells t o t hem, and how it services
t hem as well as t hrough t he t radit ional
means of product , price, promot ion
and pl ace of dist ribut ion. ICICI bank
recognizes t hat cust omers make buying Feature
deci si ons based on more t han j ust Article
pr i ce…. mor e t han j ust pr oduct .
Cust omers make t heir buying decisions
based on t heir overarching experience
t hat incl udes product , price, service
recogni t i on and support . The bank
bel ieves t hat if ICICI bank can get
al l t hose f act ors ri ght consi st ent l y
i t wi l l be r ewar ded wi t h ongoi ng
cust omer l oyal t y and val ue.
I. PRODUCT CUSTOMISATION
In or der t o st r engt hen Cust omer
Service, ICICI Bank has designed several
product s keeping in mind excl usive
requirement s of cert ain sect ions of
t he societ y.
1 . ICICI Bank Pr ivat e Banking Customers make their
Program: buying decisions
In order t o give special and dist inct based on their
t reat ment t o precious cust omers a overarching
special program has been designed experience that
by t he bank under Excl usive Banking includes product,
Program. Cust omers in excess of a price, service
l evel of deposit are of f ered a whol e recognition and
l ot of personal ized services named support.
as ICICI Bank Privat e Banking Program.
There are several Personalised of f ers
which are as f ol l ows:
z Excl usivit y and Convenience
z Dedicat ed of f icer at t he Bank
z Separat e int eract ion area in t he
branch
z Anywhere banking f acil it y
z Excl usive Banking f acil it y
Compet it ive Pricing
z Reduced rat es f or product s and
services.
z Several compl ement ary of f ers.
z Val ue l inked benef it s.
37
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature Of f er s
Article
z At Par cheque Facil it y
z Personal ised Pay in sl ip Book
z Per sonal i sed Phot o Si gnat ur e
Debi t car ds wi t h enhanced
wit hdrawal l imit .
2. Roaming Current Account :
Roaming current account is for business
personnel who t ravel ext ensively. They
ar e pr ovi ded a chequebook wher e
cheque can be t reat ed at par across
t he count ry. These cheques get cleared
at what ever l ocat ion it is deposit ed
at . So, i t does not get st uck wi t h
t he bank cl earing f or 15 days inst ead
get s cl eared in regul ar period of 2
... even the customer days as t he case i s f or any l ocal
service and support cheque.
function also has well
3. St udent s @ Campus:
defined processes
depending on the Real ising t hat st udent ’ s l if e is not a
nature and the type 9-5-lif est yle bank has int roduced t his
of query and product t hat of f ers t ime and locat ion
complaints. independent banking solut ions t o t he
st udent s communi t y.
4. Kids-e-bank:
This product t eaches children banking
and e-commerce t ransact ions t hrough
an int eract ion on-l ine int erf ace.
5. E Cheques:
For met r o based hi gh val ue
busi ness cust omer, ICICI Bank has
launched a product called e-cheques.
By using RBI’ s elect ronic f und t ransf er
( EFT) mechani sm, ICICI Bank
cust omers can t ransf er f unds using
e-cheques t o any account in 8 maj or
cit ies.
38
Technological Initiatives for Customer
Service in ICICI Bank:
Cust omer Service in ICICI bank is hugely
t echnology driven. Bank’ s philosophy
behi nd CRM i s massi ve use of
t echnol ogy. The use of t echnol ogy
might push cust omers away f rom t he
br anch and get most of t he
requirement s fulfilled t hrough machines
out si de t he br anch. Bank bel i eves
t hat t his ef f ort of bringing cust omer
l east t o t he br anch mi ght hel p i n
r educi ng t he f act or of cust omer
ignorance, poor employee behaviour,
inadequat e parking and so on. ICICI
Bank has inst al l ed SIEBEL sof t ware
in al l it s branches which t akes care
of cust omer requi rement s.
1. SIEBEL soft ware:
To accompl ish t he above obj ect ives
t hrough specif ic sof t ware, ICICI bank
has rol l ed out Cust omer Rel at ionship
Management sof t war e, SIEBEL.
Cust omer t ouches ICICI Bank f r om
a number of channel s namel y Cal l
Cent er, Bank Branch, ICICI Cent er,
ATM, Web or SMS. SIEBEL provides a
common pl at f orm, so as t o have an
i nt egr at ed si ngl e vi ew of t he end
cust omer across product l i nes and
channel s. To begi n wi t h, i t wi l l
aut omat e pr ocess-f l ow t r acki ng i n
t he pr oduct -sal es pr ocess, and be
abl e t o generat e cust omised report s
and promot e cross selling. It will also
enabl e ef f i ci ent campai gn
management by providing a sof t ware
i nt er f ace f or def i ni t i on, t r acki ng,
execut ion and analysis of campaigns.
Simil arl y, even t he cust omer service
and support f unct ion al so has wel l
def ined processes depending on t he
 LEADING THROUGH CUSTOMER SERVICE - THE ICICI BANK WAY : RAI
nat ur e and t he t ype of quer y and
compl aint s.
SIEBEL primarily addresses:
z Complaint and Quer y
Management : SIEBEL addresses
compl ai nt s i n a syst emat i c
manner. Any case requiring t he
aut hor i zat i on of an of f i cer
aut omat i cal l y goes t o t he
of f i cer ’ s mai l box and goes
f or war d onl y af t er hi s
aut horizat ion. In SIEBEL, service
r equest (SRs) and compl ai nt s
can be rout ed t o t he respect ive
depart ment s t hrough an in-built
escalat ion mat rix, which means,
if SRs/ complaint s are not resolved
wit hin t he prescribed t urn around
t ime (TAT), it will get escalat ed
t o t he hi gher l evel s i n t he
hierarchy. This in t urn ensures
ef f ect ive cont rol and redressal
of compl ai nt s.
z Cust omer Ret ent ion: The
sof t ware has got t he propert y
which enabl es t he branch head
of any of t he branch t o know
exact ly when and which account
is showing any abrupt behaviour.
The branch head can t hen be
able t o know t he reason f or such
abrupt behaviour and ult imat ely
check his/ her det achment f rom
t he bank.
Illust r at ion: If a par t i cul ar
cust omer wit hdraws a significant
amount f rom his account or he
is gradually reducing his deposit s
int o his bank account , t he branch
head may immediat ely t ake not e
of i t and i f i t i s because of
dissat isf act ion wit h t he bank, Feature
it could be immediat ely checked. Article
z Cross selling and up selling:
The sof t ware can al so be used
f or cross sel l ing and up sel l ing
pur pose. In t he above
il l ust rat ion, if t he branch head
comes t o know t hat a part icular
cust omer has wi t hdr ew
si gni f i cant money f r om hi s
account f or pur pose of some
invest ment , it can immediat el y
ask his sal es t eam t o reach t he
cust omer and of f er t he
i nvest ment avenues t hat t he
bank has as; f i xed deposi t
schemes, bonds, insurances et c.
If t he cust omer i nt ends t o
Any case requiring
purchase a propert y or car, t he
the authorization of
sal es t eam may even pursue f or
an officer
t heir own home l oans or aut o
automatically goes to
l oans.
the officer’s mailbox
z Cust omer cont act
and goes forward only
management : SIEBEL enabl es
after his
t he bank t o r ecor d compl et e
authorization.
prof il e, cont act hist ory of it s
cust omer s. The sof t war e can
even be used i n greet i ng t he
cust omer at various occasions
as hi s Bi rt hday, weddi ng day,
insurance premium submission
dat e et c. These hel p t he bank
in inducing personal t ouch wit h
t he cust omer s.
z Sales Force Automation: SIEBEL
endeavors t o t rack al l banking
account s rel at ed opport unit ies
f rom t he point where a prospect
expresses int erest in t he product
t il l t he t ime t he sal es process
get s l ogi cal l y cl osed. Thi s
sof t war e even cal cul at es
39
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature incent ive compensat ion f or t he
Article out bound sal es t eam (OBST).
2. Call Center
To facilit at e CRM, bank has an effect ive
cal l cent er t o support . So, f or most
of t he banking requirement s and f or
al most al l t ypes of cust omer
compl ai nt s, cust omer s ar e onl y
required t o cal l t o t he cal l cent er of
t he bank and rest is bank’ s j ob.
3. Aut omat ed Teller Machines:
ICICI Bank ICICI Bank has one of t he
l ar gest net wor k of ATMs i n INDIA.
Al l t he ATMs are net worked. These
ATMs not j ust act as a point t o reduce
In order to leverage
cost of set t ing up of many of branches
technology, the bank
but helps in reducing operat ional cost s
wants to provide the as f or ICICI Bank; cost of t ransact ion
most superior service. t hrough ATM is 70%lower t han branch
Net and Phone banki ng. The bank i nt ends t o get
banking options are at l east 45% of i t s t ransact i ons t o
part of that strategy. get rout ed t hrough ATMs. These ATMs
This further reduces al so act as means of promot ion. ICICI
bank’s operational Bank’ s ATMs al so hel p in cross sel l ing
cost and provides and up sel l ing. On an ICICI Bank ATM,
another option to do a cust omer can ask f or mor e
banking even from inf ormat ion on product s. Current l y,
their home or office. six opt ions are avail abl e: Car l oan,
Home loan, Credit cards, Mut ual Funds,
Lif e Insurances and Onl ine Trading.
So, i f a par t i cul ar cust omer whi l e
t ransact ing t hrough ATMs search about
a par t i cul ar pr oduct of t he bank,
t he inf ormat ion aut omat ical l y get s
r ecor ded t o t he bank’ s cent r al
command. This inf ormat ion is passed
on t o t he concerned branch head who
is supposed t o ensure visit of a sal es
st af f t o t he cust omer and enqui re
about his int erest on t hose product s.
ICICI Bank’ s ATM st rat egy i s mul t i -
lingualism. It s ATM displays informat ion
40
i n f our r egi onal l anguages besi des
Hindi and English. These are Marat hi,
Kannada, Tamil and Mal yal am. The
bank want s t o int roduce t ri-l ingual
int erf aces in each st at e.
4. Net and Phone Banking:
In order t o l everage t echnol ogy, t he
bank want s t o pr ovi de t he most
super i or ser vi ce. Net and Phone
banki ng opt i ons ar e par t of t hat
st rat egy. This f urt her reduces bank’ s
operat ional cost and provides anot her
opt ion t o do banking even f rom t heir
home or of f ice. “ Present l y net and
phone banking t ransact ions account
f or onl y 15% of t ot al t ransact ion.
III. GRIEVANCE HANDLING
MECHANISM:
1. Bank’s SIEBEL soft ware effect ively
t akes care of cust omer’s queries
and compl aint s. The sof t ware
aut omat i cal l y r ecor ds t he
compl aint s and f orwards it t o
t he per son concer ned. If t he
complaint is not redressed wit hin
t he set Turn Around Time (TAT),
t he mat t er reaches t o t he person
up in hierarchy.
2. The bank real ized t hat great er
at t ent ion t o cust omer problems;
query and compl aint shoul d be
segregat ed. Earlier every t eller
was handl i ng quer i es and
complaint s. This result ed in lack
of cont rol over act ivit y and at
t imes it was dif f icul t t o t race
who received complaint and who
r edr essed i t . It was al so f el t
by t he bank t hat it s segregat ion
woul d cl earl y demarcat e t hi s
act i vi t y and woul d hel p i n
ident if ying t hose responsible f or
 LEADING THROUGH CUSTOMER SERVICE - THE ICICI BANK WAY : RAI
redressal wit hin set Turn around
Ti me (TAT).
3. For bet t er i mpl ement at i on of
t he Bank’ s CRM pr ogr am at
branch l evel , t he bank has put
cust omer sat i sf act i on as a
par amet er i n t he st af f ’ s
performance appraisal. A regular
survey of Cust omer sat isf act ion
i s car r i ed out by cer t ai n
independent Research agency.
The st udy reveal s sat isf act ion
branch wise as wel l as at t he
over al l bank l evel . This keeps
a check on it s empl oyees f rom
r ef r ai ni ng f r om t he banks’
expect ed service del ivery. The
bank has even i ncr eased t he
wei ght age of cust omer
sat i sf act i on i n empl oyee
perf ormance apprai sal .
IV. OTHER CUSTOMER SERVICE
INITIATIVES
1. Contact Management : SIEBEL
enabl es t he bank t o r ecor d
complet e profile, cont act hist ory
and account management . The
sof t ware can even be used in
greet ing t he cust omer at various
occasions as his Birt hday, wedding
day, i nsur ance pr emi um
submission dat e et c. These help
t he bank in inducing personal
t ouch wit h t he cust omers.
2. Flexible Timings : In it s Met ro
and Urban Branches t he bank
has increased it s t imings f rom
8 AM t o 8 PM, which helps of f ice-
goi ng cust omer s.
3. Mobile ATMs : Bank has
int roduced mobil e ATMs.
4. e-Lobby : ICICI Bank has st art ed Feature
‘ e-lobby’ , a self service banking Article
cent er. The e-l obby’ showcases
most innovat ive and user friendly
gadget s providing sel f service
banki ng i n t he ar eas of bi l l
payment s, cash wi t hdr awal ,
videoconferencing wit h cust omer
service execut ive, online banking
and ot her such t r ansact i ons
wit hout any assist ance.
6. Home delivery of offers: Wit h
ef f ect ive use of t echnol ogy of
cust omers, t he bank has st art ed
sending it s sale prof essionals t o
t he cust omers’ of f ice or home.
7. ICICI Bank’ s ‘ e-l obby’ has t he
f irst ATM f or visual l y impaired
The bank aims to
per son.
provide personal
Conclusion : service through
Through al l t hese i ni t i at i ves, bank impersonal medium
want s t o have a compet it ive advant age and to convert a
over ot her pl ayers in t he market and customer from being
al so has t he obj ect ive of servicing customer of branch to
cust omers bet t er. The bank aims t o customer of bank.
pr ovi de per sonal ser vi ce t hr ough
impersonal medium and t o convert
a cust omer f rom being cust omer of
br anch t o cust omer of bank. The
Bank’ s ret ail expansion was buil t on
a t echnol ogy st rat egy t hat f ocused
on t hree areas - devel oping a vast
Aut omat i c Tel l er Machi ne ( ATM)
net wor k, usi ng t he i nt er net as a
dist ribut ion channel f or t ransact ions
wit h cust omers and t elephone banking.
Through perf ormance excellence t he
bank has been t rying t o lead t he market
and show ot her mar ket pl ayer s a
wort hy pat h t o f ol l ow.
41
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

References: t o t he branch, Bank Market ing, 33(1)

Feature
Jan/ Feb 2001 pp 40-47.
Article Magazines
1. Business Today, December 22, 2002, 9. Bala Subramanyam, K - Banker and
pg 70. cust omer rel at ionship in l aw, IBA
Bul l et in, 13(6) Jun 1991 pp 15-19.
2. Indian Management ; Jul y 2002, pg
63, pg 65. 10. Bansal, Parveen - CRM comes t o B2B,
Banker (UK), 151(905) Jul 2001 pp
3. Indian Management ; July 2002, pg26.
98-99.
4. Business Today, Dec 22, 2001, pg 70.
BOOKS
6. ICICI Bank l it erat ure
1. The CRM Handbook: A Business Guide
7. ICICI Bank Annual Report ; 2001-02
to Cust omer Rel at i onshi p
JOURNALS Management , 9 Aug 2001 Writ t en
1. Ahmed, Mahmood - Some by Jill Dych?? Published by Addison-
def i ci enci es of banker -cust omer Wesl ey Pub Co
relat ionship under t he convent ional 2. Microsof t (r) CRM For Dummies(r),
banking syst em and t heir remedy 25 Jul 2003 Writ t en by Joel Scot t ,
syst em, Bank Parikrama, 14(1&2) Mar Mi chael DeLi sa Publ i shed by For
& Jun 1989 pp 37-44. Dummies
2. Air, Roger Bel - Pl ain t al k: bridging 3. The Ul t i mat e CRM Handbook :
Through performance t he gap bet ween bor r ower s & St rat egies and Concept s for Building
excellence the bank bankers,Bank Market ing, 22(12) Dec Endur i ng Cust omer Loyal t y and
1990 pp 34-39. Prof it abilit y, 24 Sep 2002 Writ t en by
has been trying to
lead the market and 3. Al ber, Syed Hamid - Some aspect s John G. Fr eel and Publ i shed by
of t he banker-cust omer relat ionship, McGraw-Hil l Trade.
show other market
Banker’ s Journal of Mal aysia, (16) 4. The CRM Pr oj ect Management
players a worthy path Apr 1983 pp 11-13. Handbook: Bui l di ng Real i st i c
to follow.
4. Anand, M - Evolut ion of t he concept Expect at ions and Managing Risk, 17
of conf ident ialy in banker cust omer Dec 2002, Writ t en by Michael Gent le
rel at ionship, RBI Legal News and Publ ished by Kogan Page Lt d.
Views, 3(3) Jul -Sep 1998 pp 23-30. 5. Cust omer Obsession: Your Roadmap
5. Anandaraj , P - New dimensions of t o Prof i t abl e CRM Wri t t en by Ad
service delivery channels in banks, Nederlof, Jon Ant on Published by The
Canbank Quart erly Review, 11(2) Apr- Ant on Press
Jun 2000 pp 21-32. 6. Why CRM Doesn’ t Work: How t o Win
6. Anandaram, K S - Need for cust omer by Let t ing Cust omers Manage t he
sensit ivit y: A case, Excel l ence in Rel at ionship Writ t en by Frederick
Supervision, 17(3) May/ Jun 2001 pp Newel l , Set h Godin Publ ished by
141-142. Bloomberg Pr
7. Angel , Bob - CRM: t he upgrade, Others :
Canadian Banker, 107(3) 3rd Quart er 1. www. crmguru . com
2000 pp 36.
2. www.icicibank.com
8. Bachman, Timot hy - Welcome back
3. Zee Business News dat ed 3 Jan 2003.

42
 LEADING FOR THE FUTURE : SHUKLA

Leading for the Future Feature

Article

S. R. P. Shukla*

ABSTRACT

Leader s have a vi si on – f r om t hat ar i ses a cr eat i ve and a dest r uct i ve l eader. Leader s
st r i ve f or val ue addi t i on, f ut ur i st i c pl anni ng and cr eat i vi t y at ever y l evel whi ch makes
t hem a t ool f or Human Resour ce Devel opment . Fut ur e l eader s act wi t h a equi poi sed
For leading for the
vi si on of l ong t er m pl anni ng and dual t hi nki ng t o achi eve excel l ence i n publ i c sect or
or gani zat i ons. Thus l eader shi p i s a sci ent i f i c ar t ai mi ng f or maxi mi zi ng t he nascent
future one has to
r esour ces and oper at i onal i zi ng t he l at ent r esour ces pr esent l y avai l abl e.
harness his kraal
clinical acumen to
KEYWORDS : Fut ur i st i c Leader shi p, Equi poi sed vi si on, Dest r uct i ve Leader, Cr eat i ve enable equitable
Leader.
success for the
followers of his vision
of competing today
enroute their present
on job value addition

The f ut ur e Leader s cr eat e compet encies and is prepared t o put

ci r cumst ances f or al l f ol l ower s t o
become l eader s
Pragmat ically put , a leader is a person
whom people follow willingly. He, t hus,
is equipped wit h qual it ies which are
uni que and t he good news i s t hat
l eader shi p i s a ski l l whi ch can be
acquired by any one who seriousl y
desires, is endowed wit h f ew basic
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○
i n honest ef f ort s.
For l eading f or t he f ut ure one has
S. R. P. Shukla t o harness his kraal cl inical acumen
t o enabl e equit abl e success f or t he
f ol l owers of his vision of compet ing
t oday enrout e t heir present on j ob
val ue addi t i on, because t he
economically creat ive indust ries shall
be t he winners, t he one which develop
it ’ s own model of ent erprise cul t ure
○ ○ ○ ○ ○

* Consult ant , OB, OD & HRD, Ranchi

43
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature and not submi t t o t he West er n l eader s as you want and you f i nd
Article paradigms in it ’ s preparat ion f or t he t his daring t o dist urb t he universe,
f ut ure (Ramanat han S. 2006), wit h such as Gal i l eo was a di st urber i n
asser t i ve communi cat i on based on t he ast ronomi cal worl d. Al exander
t he basic paradigmat ic f alt ering while Fleming, Marie Curie were dist urbers
f aci ng def eat , a per enni al voyage in t he scient if ic worl d, Jonas Sal k,
of def eat i ng hi s def eat t hr ough t he discoverer of Polio Vaccine, Mot her
experient ial learning accruing during Teresa and Sunder Lal Bahuguna t he
t he t raj ect ory of present pragmat ic environment al ist s, Vandna Shiva, Dr.
real it y Assert ive communicat ion t o Chr i st i an Bar nar d, who per f or med
f or ge t he pur pose of wor k whi l e t he wor l d’ s f i r st hear t t r anspl ant ,
pr eci pi t at i ng a quasi – st at i onar y have al l been dist urbers f or t he good
di sequi l i bri um i n t he f ol l owers “ I” of humani t y.
This can happen only when t he leader
But not al l t he l eaders are creat ivel y
is l ogical l y dis-eased, it is t hen onl y
good. Many i n t he wor l d’ s hi st or y
t hat he can dare t o dist urb his universe
have been r ut hl ess and evi l . The
in which he is very l ikel y t o become
conquist adors, arist ocrat ic nobles from
a smug megal omaniac f eat hering his
AllBy
the enhancing
leaders have a Spain, set of f f or t he new worl d in
own nest .
sear ch of t r easur e. The gr eedy
“VISION”,
knowledge a purpose
is The f irst quest ion such l eader asks conquist adors syst emat ically and cruelly
in meant
life. Whether
havingthey
himsel f is “ do I dare t o dist urb my rout ed out and dest royed an ancient
are creative or
realistic insights uni ver se” . Thi s ent ai l s har nessi ng civilizat ion, all f or t he sake of money;
destructive depends
about the courage t o dist urb t he equil ibrium t hey dist urbed and l ef t a gaping hol e
upon whether they
of t he life space around himself t hereby in man’ s hist ory. Marant , Mohammad
haveprevailing
a correct vision cr eat i ng per cussi on’ s and Gaznavi, Mohammad Ghauri, Taimur
or abusiness
vision gone repercussions. In order t o do so, he Lung and Robespierre were spurred
environment
wrong. ..... has t o be “ dis-eased wit h his “ SELF” solely by hat e, Jealousy and a disparat e
l iving in a perennial st at e of creat ive sense of vengeance (Jesudasan 1997).
dissat isf act ion wit h his l if e space t o
Al l t he l eaders have a “ VISION” , a
repair, f or which he l aunches upon
pur pose i n l i f e. Whet her t hey ar e
a l if e l ong voyage. Let us t ake f ew
creat ive or dest ruct ive depends upon
exampl es- Gandhij i a physical l y f rail
whet her t hey have a correct vision
person was a great universe dist urber
or a vision gone wrong. Leaving t he
who br ought t he gi gant i c Br i t i sh
universe al one and l eading a cushy
Empire, wit h it s aura of invincibl e
cocooned l if e is pl aying it saf e. This
power, t o i t s knees by hi s uni que,
anal ysis is t hat “ If I’ m O. K. “ t hat ’ s
t he t hen unknown, met hod of non-
O. K. The creat ive dist urber t hinks
voilent policies. Anwar Sadat , Egypt ian
quit e dif f erent l y. He t hinks “ If I’ m
President , t oo t ried t o work f or peace
O. K. t hen everyone el se shoul d be
in one of most dif f icul t t imes in a
so t oo: And i f I’ m O. K. and t hey
t urbul ent area, f ul l y aware t hat by
are not , what can I do t o make it
dist urbing t hat small universe he might
O. K. f or t hem? Thi s ent ai l s t hat
die f or it . And he did. Take as many

44

t he creat i ve l eaders operat e f rom
t he l if e posit ion of I’ m O. K. and I
wi l l make i t O. K. f or you. Let us
bot h be O. K. Whereas t he dest ruct ive
leaders operat e f rom t he lif e posit ion
of I’ m O. K. and I am going t o be
more O. K. , whet her you are O. K.
or not , I care l ess; and t o hel l wit h
you [ f you dare t o disobey me . The
anal ysis is t hat t he creat ive l eaders
ar e “ soci o- cent r i c” wher eas t he
dest ruct ive l eaders are “ Eccent ric” .
The creat ive l eaders are t hus “ Val ue
adding” t o t heir universe. Each one
of us has t he pot ent ial t o be a universe
dist urber, eit her in a creat ive way,
or in a dest ruct ive way. In our pl aces
of work, of l iving, in our int eract ion
wit h ot her peopl e, we al l have t he
abil it y t o quest ion what is going on
around us? The leader quest ions values
and norms t hat are so compl acent l y
accept ed, t hey can t hen t urn t hem
upsi de down and f i nd new t r ut hs,
new ways of deal ing wit h sit uat ions,
new met hods of wor ki ng, new
syst ems, new means of pat hs t hat
l ead t o val ue addit ion. They t hrive
in chaos, ushering in change, t hey
encourage new ways of doing t hing,
ki ndl e l at ent pot ent i al s i n human
bei ngs, maki ng or di nar y men do
ext raordinary t hings, t hey pave t he
ways f or new discoveries. They are
highl y creat ive t hemsel ves and t ap
t he available creat ivit y lying dormant
in peopl e around t hem and t hey do
so by dist urbing everyone around t hem
t hr ough i nf usi on of di ssat i sf act i on
wit h t he st at us-quo-ant e—t he present .
This commot ion is brought about by
t he proj ect ion of t he disequil ibrium
of t heir mil ieu int erior cul minat ing
LEADING FOR THE FUTURE : SHUKLA
i n di sequi l i br i um of t hei r mi l i eu Feature
ext er i or. Article
Being a f ut ure leader means devot ing
your life or your t ime fully for a specific
cause. It means put t ing human beings
above t hi ngs and t r eat i ng t hem
humanel y. It means pl acing a val ue
on somet hing more t han j ust yourself .
It means having a f ut urist ic vision.
Now you may ask me whet her t his
i s wort h i t – I woul d say, “ Yes i t ’ s
wor t h i t . Abundant l y wor t h i t ” – i f
you want t o be a l eader. What do
you say?
Leadership is indispensabl e f or our
self , f amily, organizat ions and nat ion Leadership is
and i s a pr oact i ve, dynami c and indispensable for our
i nt eract i onal act i vi t y, wherei n t he self, family,
leader has role clarit y and goal clarit y
organizations and
wit h energet ic perseverance f or rol e
nation and is a
expansion. Carving out a rol e niche
proactive, dynamic
in his f unct ional space. Leadership
and interactional
i s not a sci ence, i t i s a sci ent i f i c
activity, wherein the
ar t , hence l ear nt , devel oped and
pr act i ced. Leader shi p t hus can
leader has role clarity
maximal l y be “ l earnt or improved”
and goal clarity with
cont inual l y. Leaders, t heref ore, are energetic perseverance
not born; t hey surel y are made by for role expansion.
personal ef f ort . Leaders work t hrough
peopl e. His sel f concept , needs and
values move t he f ollowers rat her t han
marionet t e. Leader veil s power, by
underst anding power and it s dynamics
and l ear ns t he nuances of power,
be i t char i smat i c, i nspi r at i onal or
t ransf ormat ional . Leaders are abl e
t o make t hi ngs happen, i nf l uence
peopl e and event s, creat e changes
invariabl y, and cont inuousl y produce
r esul t s. It has t o be r emember ed
t hat l eaders are not perf ect human
bei ngs t hey ar e equi pped wi t h
45
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature weakness l ike al l of us, t hey may be hi s hor n t oot ed by t hose who ar e
Article quit e subj ect ive, overly reckless, overly per f or mi ng.
caut i ous, f ast i di ous and deepl y
The fact t hat t he resources i.e. money,
at t ached, t hese weaknesses produce
machines, mat erials and met hods are
cat ast r ophe i n t he execut i on of
pot ent l y import ant is not t aken int o
t hemsel ves and of t heir st rat egy.
cogni zance because of t hei r bei ng
Aggressiveness and Passiveness wit h t aken f or gr ant ed. These have t o
pessimism are t he key weaknesses. be pivot al l y operat ional ized by t he
The disadvant ages of l eadership are COO. The CEO t akes car e of t he
l ack of compl et e privacy, t runcat ed humane f act or.
f amily lif e, cont inuous and long hours
Al l successf ul l eaders are cognizant
of wor k, f ear of cr i t i ci sm and
of Human Pot ent ial , al l are Human
det eriorat ion of heal t h. Personal it y
Resour ce Devel oper s. Let us t ake
t rait s of leaders are known as dynamic;
exampl es of f ol l owing such business
hence r equi r e f l exi bl e si t uat i onal
bil l ionaires : -
abilit ies, shift ing st andards and evolving
qualit ies, differing from organizat ion’s 1. N. R. Nar ayanmur t hy :
f unct i onal j ur i sdi ct i ons to Chai r man, Inf osys.
The fact that the
organizat ional Gest al t , sit uat ion as “ Al l 8000 empl oyees are real asset s;
resources i.e. money,
per cont ext ual paradigm . No mat t er not t he buil ding, business or f oreign
machines, materials
how many leadership qualit ies a leader cont ract s. They walk of t he gat e every
and methods are
has, t hey are usel ess and wort hl ess, evening and I wait f or t hem t o come
potently important is
i f t he oper at i ng mass ( of f i cer ’ s back t o my company next morning.
not taken into
associat ion & t rade union) does not
cognizance because of 2. H. S. Singhania : Chai rman,
properl y recognise t hem – visibil it y
their being taken for J. K. Cor por at i on.
is invariabl y sought by a l eader – get
granted.
Fol l owing are t he l eadership qual it ies: -
Behavioural Emot ional Skills
1. Assert i veness Ambi t i ousness dmi ni st rat i on
2. Act i on ori ent at i on Af f ect i on Communi cat i on
3. Art icul at ion Aut hori t at i veness Creat i vi t y
4. Decisiveness Cour age Inspirat ional
5. Ent husi asm Enl i ght ement Int elligence
6. Friendl iness Empat hy Int erpersonal
7. Flexibilit y Endurance Or gani si ng
8. Fai r ness Fai t h Ent repreneurshi p
9. Ini t i at i ve Int egri t y St at us
10. Mot i vat i on Opt i mi sm Expert i se
11. Obj ect ivit y Ri sk t aki ng Concept ual

46

12. Persuasiveness Responsibilit y
13. Rol e model Sel f conf idence
14. Cont inuous l earning Sel f t ranscendat ion Pl anning
15. Cont inuous Growt h Sel f assurance
16. Synergy Wil l power
17. Group/ mass acumen Power
“ My phi l osophy i s nur t ur i ng and
devel oping human capit al ” .
3. Kishore Biyani : M. D. Pant aloon.
“ My human Resources are my most
val uabl e asset s and pl ay a crucial in
t he success of t he company.
Wit h t he above qual it ies t he l eader
f or t he f ut ure act s wit h Equipoised
Vision – equipoised bet ween t he anvil
of present vision and t he vision of
st r at egi c f ut ur e wi t h avai l abl e
resources possessed wit h an At t ribut ive
St ance and charismat ics int rapreneurial
behaviour (Shukl a et al 2007),
Equi pped wi t h above enunci at ed
compet encies l eading f or t he f ut ure
in Publ ic Sect or Ent erprises ent ail s
sl ogging t he decaying non-evol vabl e
resources t oday f or compet ing f or –
t oday f or t oday st r at egi es, whi l e
preparing f or t omorrow – t oday f or
t omor r ow pr act i ces cr yst al l i zed i n
f igure 1. Leading f or t he immediat e
f ut ure, wi t h avai l abl e resources i n
Publ ic Sect or Ent erprises consist s of :
Maxi mi zi ng pr esent or gani zat i onal
capabilit ies and developing new ones
i n ant i ci pat i on of t he f ut ur e
charact erize t he high perf ormer in
al l f iel ds of endeavour; devel op new
milit ary st rengt hs t o prepare for bat t les
st il l unf ought . This is not happening
LEADING FOR THE FUTURE : SHUKLA
Del egat ion Feature
Hel ping Article
Reorgani si ng syst ems
Inf l uencing Human beings
Gr oup/ Mass
(Kr i shnan 1997)
i n Indi an Publ i c Sect or Ent erpri ses
because we ar e engul f ed by t he
hurricane of polit ico economical fluxes
t hus cat ching t he waves of change
culminat ing in a severe demoralisat ion
of our or gani sat i on as a whol e.
(Shukl a 2003).
Two Agendas : ( Abel l 1999)
Planning for today
Pr esent pl anni ng al so r equi r es
requires a clear,
st rat egy-a vision of how t he f irm has
t o oper at e now ( gi ven i t s precise definition of
compet enci es t arget market s) and the business—a
what t he rol e of each key f unct ion delineation of target
wil l be. customer segments,
The l ong-t erm pl an, by cont rast , is
customer service
functions, and the
based on a vi si on f or t he f ut ur e—
business approach to
even more import ant , a st rat egy f or
be taken
get t ing t here. Where is t he present
plan in Public Sect or Ent erprises caught
up in rout ine j obs and playing a second
f iddl e whil e dol ing away t he brain
t o t he mul t i nat ional and ot her out
sourcing agencies, t his won’ t do! Vision
f or t he f ut ur e i s t her e i n our PSE
but t he st r at egy f or get t i ng t her e
i s not oper at i ng. Ej ect i ng peopl e,
who posses t he core compet encies,
on roads, is an act of naivet y.
z Pl anni ng f or t oday requi res a
cl ear, precise def init ion of t he
business—a delineat ion of t arget
cust omer segment s, cust omer
ser vi ce f unct i ons, and t he
47
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature business approach t o be t aken
Article as f or pl anning f or t omorrow is
concer ned wi t h how t he
business shal l get redef ined f or
t he f ut ure. Just now we must
decide what j obs t o do present ly
and more import ant what j obs
not t o do present l y. Unl ess t his
is cl earl y underst ood we shal l
be busy wit hout doing business
t o l ive in a mirage of success
as is happening now a days in
some of our uni t s.
z Pl anning f or t oday f ocuses on
shapi ng up t he oper at i ons t o
meet t he needs of t oday’ s
Planning for today cust omers, wit h excel l ence. It
requires an involves ident ifying t he available
organization that necessary resource redeployment
mirrors current t hat are crit ical t o success and
business f at hering t hem wit h at t ent ion;
opportunities; planning for t omorrow can ent ail
planning for r eshapi ng t he r esour ces t o
tomorrow may compet e more ef f ect ively in t he
require f ut ure. We have t o reshape our
reorganization for r esour ces and st r at egi es and
imminent future depl oy t hem t o compet e in t he
challenges f ut ur e f or whi ch newer, not
avai l abl e pr esent l y, cor e
compet enci es need t o be
cryst allised, in t he crit ical mass
of at r ophyi ng exper t s, wi t h
paral l el prof it cent res, which
need t o f unct i on as a vi rt ual
organisat ion wit hin t he Publ ic
Sect or Ent er pr i ses. Not
happeni ng so; has t o be
cat apul t ed int o happening so.
z Oper at i ng f or t oday seeks t o
achieve compliance in t he f irm’s
f unct i onal act i vi t i es wi t h
what ever resources are available,
48
involves Int rapreurial Leadership
(Shukl a 2007), St r at egi es f or
t omorrow invol ves bol d moves
away f r om exi st i ng ways of
conduct ion your SELF. The virt ual
or gani sat i on, f or emer gi ng
compet encies ought t o be forged
wi t h vast l y di f f erent ways of
conduct ing business; absolut ely
di f f er ent f r om t he pr evai l i ng
one virt ual organizat ion consist s
of Bon home manoeuvres (Fig.
2) wit h our crit ical mass.
z Pl anning f or t oday requires an
organizat ion t hat mirrors current
business opport unit ies; planning
f or t omor r ow may r equi r e
r eor gani zat i on f or i mmi nent
f ut ure chal l enges, t he f ormer
operat ion is about managing t he
avai l abl e r esour ces wi t h
excel l ence. The l at t er is about
commissioning of t he decaying
available nascent compet encies
t o evol ve ahead of t he peer
or gani sat i ons.
Defining Leadership Responsibilities:
At t he very t op, some organizat ions,
recognizing t he dual nat ure of t he
t op-management challenge, have split
t he j ob i n t wo – one par t bei ng
managed by t he chief execut ive officer
(CEO) and t he ot her part by t he chief
operat i ng of f i cer (COO). An –ot her
i s t o l ook f or t he spl i t i n a si ngl e
individual ; yet anot her is t o have a
chief execut ive who coordinat es t wo
t op managers – one responsibl e f or
pl anning and del ivering excel l ence
t oday (COO), t he ot her responsibl e
f or get t ing ready f or t omorrow (CEO).
“ Peopl e are overworked and do not
 LEADING FOR THE FUTURE : SHUKLA

STRATEGIES Feature
of Article
The Leader for t he Fut ure Compet ing

Today f or t oday Today f or t omor r ow

Hi gh

Sl ogging t hem Depl oying Them

Quasi -
E st at ionary Expert ise
Disequilibrium Management
N
T
R
O
P
Y Expl oit ing Them Grooming Them

... the chief executive

Dynamic
must be prepared to
Disequilibrium Brain Grain pursue both excellence
today and be uneasy
for tomorrow.

Low
Nascent Lat ent

Avail abl e resources pot ent ial

Fig. 1

t hink much about t omorrow; many
managers are not visionary by nat ure.
But in a general management group
of t en, may be you onl y need one
or t wo visionaries. You need at l east
f our or f ive wit h hard noses! ” Two
concl usions, however, st and out .
2.
1. First , t he chief execut ive must
be pr epar ed t o pur sue bot h
excellence t oday and be uneasy
f or t omor r ow. Thi s r eadi ness
shoul d be one of t he
di st i ngui shi ng cr i t er i a f or
sel ect i ng candi dat es f or t he
company’ s busi ness cent r es
heads.
Second, in t he t op-management
t eam, all managers must be able
t o wear bot h hat s. Sol ut ions at
t he very t op, however, are onl y

49
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature ATTRIBUTIVE MANOUVERS

Article of
Leader for t he Fut ure

Operat ional St rat egi c

Hi gh
COO CEO
Low Least Pr ef er r ed Co- wor ker Mut ualit y

Cont ingency Behavi our al

E Char i smat i c
Leadership
N At t r i but i on

T
R
O
P High Least Pr ef er r ed Co- wor ker Bonhomi e
One role of leadership
Y
for the future is to
promote the need for
dual thinking at all
levels and Int rapreneurial Equipoised
Leadership At t ribut ive
communicate the two St at esmanship
agendas and their
significance for all
levels of the enterprise
through resources Low
Nascent Lat ent
alignment.
Avail abl e resources pot ent ial

Fig. 2

a part of t he st ory. Dualit y is also One rol e of l eadership f or t he f ut ure

needed f urt her down t he line up
t o f unct ional head l evel . Those
f unct ional heads who are unable
t o wear bot h t he hat s should be
rot at ed, t here is no probl em
because most of t he
depart ment s/ sect ions have more
t han one DGMs / GMs i n t he
congruent f unct i ons, one can
do CEO’ S and ot her COO’ S role.
i s t o pr omot e t he need f or dual
t hinking at all levels and communicat e
t he t wo agendas and t heir significance
f or all levels of t he ent erprise t hrough
resources alignment . Many employees
l ower down and cl oser t o cust omers
and supply-chain part ners are confused
by what t hey int erpret as cont radict ory
signal s about t oday and t omorrow.

50

The t wo agendas can be int egrat ed
onl y if t hose who need t o impl ement
t oday and change f or t omor r ow
underst and t he reasons behind each.
Cross-f unct ional or cross-l evel t ask
f orces aimed at ret hinking st rat egies
or reengi neeri ng processes can be
i mpor t ant mechani sms f or
communi cat i ng t hese reasons.
Reference :
z Abel l D. F. (1999): Compet i ng
t oday whi l e pr epar i ng f or
t omor r ow Sl oan Management
Revi ew Spri ng.
z Jesudasan: U ( 1997) : “ They
Rocked t he World” , News Paper,
THE HINDU, Vol . 120, No. 45,
Sat urday, 22. 2. 97, Young World,
Page 1.
z Krishnan S. (1997): “ Perspect ives
on Leadership Qual it ies” , News
Paper, THE HINDU, Vol . 120,
No. 45, Sat ur day 22. 2. 97
Opport uni t i es, Page 23.
z Ramanat han S. ( 2006) : The
Creat rivit y Mant ra; THE HINDU
( Del hi ) Sunday, Oct ober 29
Magazi ne page 7.
LEADING FOR THE FUTURE : SHUKLA
For get t ing result s, leading f or f ut ure Feature
in Publ ic Sect or Ent erprises ent ail s Article
at t ribut ive manoeuvres as shown in
f i gur e 2.
In t he ul t imat e anal ysis l eading f or
t he f ut ur e consi st s of maxi mi zi ng
t he nasent r esour ces and
simul t aneousl y operat ional ising t he
l at ent resources present l y avail abl e.
z Shukla SRP; Pramanik KB, Azariah
H ( 2007) : A St udy of
Int rapreneurial Leadership in a ... leading for the
Large Public Sect or St eel Indust ry future consists of
i n INDIA i n Or gani zat i onal maximizing the
St rat egy and processes Kumar nasent resources and
A 2007 VIVA Books New Del hi, simultaneously
India pages 291 t o 312. operationalising the
z Shukl a SRP (2003): Pr epar i ng latent resources
St eel Sect or PSE’s f or Compet ing presently available.
t oday whi l e pr epar i ng f or
t omor r ow. East er n Regi onal
Convent ion of Indian Societ y f or
Tr ai ni ng & Devel opment on
Previt al ising Organisat ions f or
Sust ainabl e st rengt h, 18 & 19t h
Apr i l 2003 Souveni r pages 12
t o 17.
51
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature Leading for the Future : Role of HR

Article

Dr. P. K. Banerj ee*

Shwet a Singh**

Abst ract
Ther e ar e i ncr easi ng number of pr essur es t oday on an or gani zat i on l i ke gl obal i zat i on,
changing t echnology, and changes in workf orce including employees’ priorit ies, capabilit ies
and demogr aphi c char act er i st i cs. In t hese si t uat i ons, any or gani zat i on i s bound t o go
t hrough a t ransit ion. During t his t ransit ion t he design, st ruct ure, st rat egies everyt hing
... before going for
of t he or gani zat i on wi l l change. Thi s pr esent s a need f or (and oppor t uni t y f or ) t he HR
any sort of transition, f unct ion t o become more act ive and pl ay a crucial rol e in t he success of t he organizat ion.
the HR function HR i s t he most i mpor t ant r esour ce i n any or gani zat i on. Wi t hout i t none of t he ot her
should be well aware resources can be managed f ul l y and opt imal l y. So, bef ore going f or any sort of t ransit ion,
of its responsibilities t he HR f unct i on shoul d be wel l awar e of i t s r esponsi bi l i t i es and chal l enges l yi ng ahead
and challenges lying and al so t he i mpor t ant r ol e i t has t o pl ay. The t r ansi t i on shoul d be gr adual and wel l
ahead and also the pl anned. It shoul d have t he f ocus on how i t can l ead t he or gani zat i on i n t he f ut ur e.
important role it has It shoul d f or mul at e new st r at egi es whi l e t aki ng i nt o account al l sor t s of const r ai nt s
l i ke changi ng mar ket r equi r ement s, speed, gr owi ng compet i t i on et c. At t he same t i me
to play.
it shoul d be more and more peopl e orient ed because onl y peopl e capabil it y det ermines
t he success of t he or gani zat i on.
Key Words : Gl obal i zat i on, Li ber al i zat i on, St r at egi es.

Int roduct ion di ssol ut i on, merger or downsi zi ng.

Fort une magazine f irst publ ished it s
l ist of America’ s t op 500 companies
i n 1956. Today f ewer t han 30
companies f rom t he t op 100 in t he
original list are remaining t here. The
ot her 70 plus have disappeared t hrough
But coul d anyone have predict ed t he
f at e of t hese companies 50-60 years
back. Of course not . The f ut ure can
never be predict ed. We can only make
a guess about how t he sit uat ions could
become in t he f ut ure.

○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

* DGM (P&A), MTI, Ranchi

** MBA St udent , XISS, Ranchi

52
 LEADING FOR THE FUTURE - ROLE OF HR : BANERJEE & SINGH
The worl d is changing very f ast . The
organizat ions t oday work in a dynamic
si t uat i on. They t hemsel ves ar e
changi ng cont i nuousl y. So, bef or e
discussing any kind of devel opment
of busi ness we must f i r st have an
insight l ook of t he changing business
environment and t he direct ion of t hese
changes.
Changing Business Environment
In t he 19t h cent ury as t he pace of
indust rializat ion t ook of f , new t rends
were seen in t he business. Consequent ly
t he whol e worl d ent ered int o t he era
of LPG, i . e. , Li ber al i sat i on,
Privat isat ion and Globalisat ion. Today,
al l count r i es ar e l i ber at i ng t hei r
economic policy so t hat f oreign t rade
and global business can be encouraged.
The privat e ownership of organizat ions
is al so t he current t rend. Right now
many publ i c sect or compani es are
being privat ized. Disinvest ment i. e. ,
sel l ing of t he Government share of
an organi zat i on i s al so bei ng done
l i ke t he Indi an Gover nment has
disinvest ed it s share in Marut i Udyog,
BHEL et c.
Gl obal isat ion has made t he worl d a
smal l gl obal vi l l age. Wi t h i t t he
int ercount ry boundary lines are fading.
The Economi c, soci al and cul t ur al
i nt eract i ons of t he count ri es have
i ncreased mani f ol d. Thei r busi ness
t oo is af f ect ed. Today t he business
houses f ace gl obal compet i t i on i n
addit ion t o t he l ocal compet it ions.
Wi t h mer ger s, acqui si t i ons and
downsi zi ng mor e and mor e MNC’ s
are coming . They operat e in dif f erent
count r i es, compet i ng wi t h ot her
MNC’s. Thus t oday’s Business Scenario
has become mor e compl ex and
uncert ain. Compet it ion get s t ougher Feature
past each day, unl i ke yest eryears, Article
t oday compet i t i on or t he enemi es
can’ t be l ocat ed. It ’ s impossibl e t o
assess how many compet it ors are t here
and where are t hey. The chal l enges
and har dshi ps of any or gani zat i on
have become mult idirect ional and can
come f r om any di r ect i ons. The
chal l enges are hidden. Somet imes it
may be due t o ext ernal f act ors l ike
evol vi ng t echnol ogy ot her t i mes i t
may be due t o int ernal f act ors l ike
unionizat ion, f inancial crunch et c.
Thus t he Business Environment t oday
has become hi ghl y chaot i c and
ambiguous. In t hese sit uat ions, survival
even for t he most successful companies Organizations that
can’ t be t aken f or gr ant ed. They don’t bring about
can survive onl y when t hey have t he timely change in
capaci t y t o adapt qui ckl y t o t he approximate ways are
changes. Or gani zat i ons t hat don’ t unlikely to survive.
br i ng about t i mel y change i n In fact managing
appr oxi mat e ways ar e unl i kel y t o business is more of
survi ve. In f act managi ng busi ness managing the change.
is more of managing t he change. It It is all about change
is al l about change management . management.
Impact On Corporat e
We saw t hat busi ness envi ronment
i s changi ng r api dl y. Gl obal i zat i on
remains phenomenal in bringing about
t hese changes. These changes i n
busi ness envi ronment has resul t ed
in massive changes in t he operat ions
and approaches of t he organizat ion.
They t oo are get t ing a f acel if t . The
impact of t hese changes is ref l ect ed
in t he f ol l owing dif f erent areas:
z Change in Workplace
The operat ions of any organizat ions
have become diverse. They are spread
across t he worl d. So, t he empl oyees
53
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature are needed t o be l ocat ed gl obal l y,
Article wherever t heir skil l s and service are
requi red. Thi s changi ng workpl ace
cr eat es a need of non-t r adi t i onal
empl oyees who can adj ust anywhere
and everywhere. They must be t olerant
enough t owards t he cult ural and ot her
changes whil e working out side t heir
home count ry.
z Change in Lifest yle
Today t he business environment being
dynami c and organi zat i ons get t i ng
bigger, t here is a change in t he lifest yle
of t he empl oyees al so. Their l iving
st andard has risen. Their expect at ions
in l if e and t he crit eria f or success
In addition to have al so changed. This af f ect s t he
policies, reward way t hey work, t hei r perf ormance
structure and the and f inally t heir product ivit y. Hence,
goals, the t he or gani zat i ons f ace t hi s maj or
management style chal l enge t o adapt t hemsel ves
accordingl y t o mat ch t he l if est yl es
and administrative
of t he empl oyee.
systems also needs
constant changes to z Mount ing Employee
increase the efficiency Expect at ions
and improve the Empl oyee expect at i ons have al so
company’s image. changed. Now peopl e t ry t o be more
visible and act ive in t he organizat ion.
They want t o be rewarded f or t heir
good wor k. They ar e mor e awar e
of t he global st andards and want t heir
wages and per ks accor di ngl y. The
skilled and t alent ed lot of employees
is not ready t o set t le down for anyt hing
l ess or t o make compromi ses.
z Changing Administ rat ive
Syst ems
In addit ion t o policies, reward st ruct ure
and t he goal s, t he management st yl e
and administ rat ive syst ems also needs
const ant changes t o i ncr ease t he
ef f iciency and improve t he company’s
54
image. The administ rat ive works t oday
are most ly out sourced as a cost cut t ing
measur e.
z Changing Organizat ional
St ruct ure and Size
Corporat es have considerabl y grown
i n si ze wi t h mor e mer ger s and
acqui si t i ons t aki ng pl ace. Thi s
possesses addit ional challenges before
t he or gani zat i ons. They have t o
address issues like bet t er pay, healt hy
work environment , saf et y and healt h
of t he empl oyee, empl oyee wel f are
et c.
There is a shif t in t he organizat ional
st ruct ure al so. Vert i cal di vi si on of
labour is t aking place of t he t radit ional
horizont al division of l abour.
z Introduction of New Technology
There is an inflow of new and advanced
t echnol ogy i n busi ness. The
int roduct ion of int ernet and mobil e
phones has t ransf ormed t he f ace of
business. Now it ’ s popul arl y known
as e-business, al l t ransact ions being
per f or med onl i ne. Wi t h change i n
t echnol ogy, demands i n j obs have
al so become compl icat ed. Now more
t r ai ned and ski l l ed wor ker s ar e
requi red.
z Changing Employee
Demographics
Ther e i s a shi f t of demogr aphi c
charact erist ics. The composit ion of
t he workf orce has changed in cont ext
of sex, cast e, rel i gi on, popul at i on
et c. Earl ier it was mal e dominat ing
corporat e worl d but now t he number
of f emal es ent ering t he organizat ion
has increased. Earl ier t he j obs were
rest rict ed t o part icul ar cast es. But
now wi t h scar ci t y of j obs, peopl e
 LEADING FOR THE FUTURE - ROLE OF HR : BANERJEE & SINGH

are ready t o do what ever j obs t hey
ar e of f er ed.
z Global Competition
Post gl obal i zat i on, busi ness i s not
rest rict ed wit hin t he boundaries of
any one count ry onl y. Businesses are
becoming diverse. The companies are
growing int o mult inat ional companies.
Thus companies operat e in dif f erent
count ries and face global compet it ion.
z Change In Organizat ional
Cult ure
Wit h change in demographic charact ers
and t he compani es becomi ng
mult inat ional t he organizat ional cult ure
is bound t o change. It cannot be t he
same as earl ier. Peopl e coming f rom
dif f erent cul t ural background af f ect
t he organizat ion. Also, when t he same
company i s oper at i ng i n di f f er ent
count ries, it has t o abide dif f erent
set s of rul es and regul at ions t here.
So, i t i s a maj or chal l enge bef ore
t he or gani zat i ons t hat i t devel ops
it s organizat ional cul t ure in such a
way t hat it suit s everyone.
Import ance Of HR
Business organizat ions have become
dynamic and are changing const ant ly.
To cope up wi t h t hi s change t hey
need a wi de var i et y of r esour ces.
There is an inf low of newer and more
advanced t echnol ogy whi l e ot her
resources are more or l ess l imit ed.
These resources have t o be managed
efficient ly and effect ively so t hat t hey
increase t he product ivit y and t he profit
of t he company even whil e working
under several ot her const raint s. At
t his point of t ime human resources
comes int o pl ay, because t o manage
all ot her resources, human int elligence,
skills and compet encies are required. Feature
No t echnol ogy, however advanced it Article
may be, can ever repl ace t he human
brain, i. e. , why st il l t he man behind
t he machi ne i s consi der ed mor e
import ant t han t he machine it sel f .
It ’ s not j ust t hat t o manage t he ot her
r esour ces, we r equi r e t he HR. To
promot e t he vision of organizat ion
t o t he masses, communi cat i on i s
required f or which we require HR.
For pr obl em sol vi ng and conf l i ct
resol vi ng al so, we requi re t he HR.
The import ance of HR has been wel l
est abl ished in t he past and can’ t be
overl ooked in t he f ut ure al so.
Transformation of The HR Function
As t he busi ness and or gani zat i on
... the old and
evolve, HR also f aces new challenges.
Right now t he ol d and convent ional
conventional HR
HR pract ices no longer remain fruit ful.
practices no longer
It shoul d al so adapt i t sel f t o cope remain fruitful. It
up wit h changes and f it it sel f in t he should also adapt
f ut ure. So, we need a t ransf ormat ion itself to cope up with
in t he role of HR f rom past t o present changes and fit itself
keeping t he f ut ure in mind. in the future.
Earl i er HR most l y revol ved around
administ rat ive dut ies l ike st af f ing,
t raining, empl oyee benef it s et c. t he
whol e approach was act ivit y-based
i . e. , concent r at ed on t he
admi ni st rat i ve syst em. As busi ness
and social dynamics changed, so t he
role of HR evolved. It always st ruggled
t o meet new chal l enges rel at ed t o
gover nment r ul es and r egul at i ons,
l aws, empl oyment oppor t uni t i es,
occupat ional saf et y, healt h and ot her
employee benef it s. These t radit ional
roles and responsibilit ies of HR funct ion
ar e namel y HRP, Recr ui t ment ,
Sel ect i on, Induct i on/ Or i ent at i on,

55
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature Mot ivat ion, Handl ing Unions, Wages/
Article Sal ary et c
These t radit ional HR pract ices and
t he rol es pl ayed by t he HR managers
t il l now. But t he current sit uat ions
are changi ng. In addi t i on t o t hese
responsibilit ies, t he HR managers f ace
new chal l enges f or which t hey have
t o t r ansf or m t hemsel ves. Now l et
us have a l ook on new chal l enges
ahead of t he HR pract i t i oners and
t he rol e t hey are required t o pl ay.
New Challenges Ahead Of HR
Wayve Brockbank and Dave Ulrich says,
“ If HR has t o cont ribut e t o business,
it has t o break out of t hat way of
t hinking, it has t o f al l in l ove wit h
Changing technology busi ness r at her t han human
also affects the resources. ”
knowledge capital This suggest s t hat t oday HR requires
because human t o break f ree f rom t he t radi t i onal
know-how is mi ndset and devel op a whol e new
intimately and out look about how it could cont ribut e
intricately linked to i nt o devel opi ng and enr i chi ng t he
using technology business. At present it f aces several
effectively. new challenges. These can be summed
up as f ol l ows:
z Managing Diversit y
The composi t i on of wor kf or ce has
changed rapidl y. Peopl e are ready t o
cross boundari es and go anywhere
i n t he worl d were t hey get bet t er
prospect s, growt h opport unit ies and
challenging j ob. When t hey cross t heir
boundaries and are placed elsewhere
in worl d, t hey may f eel a cul t ural
shock since t he cul t ures of dif f erent
count r i es var y gr eat l y. Al so, t he
number s of young wor ker s ar e
increasing in t he workf orce. These
young employees oft en have a different
way of t hinking. They anal yze and
56
perceive t he sit uat ions in a dif f erent
manner which may not be same as
t hose of ol d and exper i enced
execut i ves. Even t hei r st yl e of
perf orming a j ob is al so dif f erent .
Managing t his diversit y and differences
ef f ect ivel y is a big chal l enge bef ore
t he HR manager. They should manage
t o creat e a harmonious and heal t hy
envi r onment on j ob so t hat each
empl oyee coul d give his 100% t o t he
j ob. They shoul d be abl e t o manage
t he di f f er ences and di ver si t y
ef f ect ivel y so as t o avoid cl ashes of
dif f erent generat ion, communicat ion
gap and even t he cul t ur al gap. It
shoul d of f er compet it ive advant age
t o t he f or m.
z Technological Advancement
At present t echnol ogy is no more a
synonym t o gizmos and gadget s onl y.
The scope has widened enormousl y.
We have dif f erent t ypes of t echnology
like communicat ion t echnology, process
t echnol ogy, and human t echnol ogy.
Almost all organizat ions are af f ect ed
by t hese changi ng and evol vi ng
t echnologies. The changing t echnology
af f ect s gl obal izat ion by connect ing
t he or gani zat i on wor l dwi de. They
af f ect t he speed of decision making
and pace of impl ement at ion. It al so
af f ect s t he speed of market change
by reducing t ime lags bet ween dist ant
point s. The t ime reduct ion increases
t he market vol at il it y which resul t s
i n demand f or r api d pr oduct
i nnovat i on.
Changing t echnol ogy al so af f ect s t he
knowl edge capi t al because human
know-how is int imat ely and int ricat ely
linked t o using t echnology ef f ect ively.
Today every inf ormat ion is avail abl e
 LEADING FOR THE FUTURE - ROLE OF HR : BANERJEE & SINGH
on int ernet . Any proceedings in any
part of t he worl d, smal l or big, come
on t he i nt er net . Thus t echnol ogy
af f ect s each or gani zat i on i n a bi g
way. However, t his t echnology comes
wit h a price. They also require t rained
and skilled people who can use t hem.
So, whi l e goi ng f or advanced
t echnol ogy t he managers shoul d be
qui t e caut i ous about t he cost
const rai nt . At t he same t i me t hey
should not lag behind t he t echnology,
ot herwise ot her companies wil l gain
compet i t i ve advant age over t hem.
z Out sourcing of HR Act ivit ies
Hal f of t he HR work is administ rat ive
t ransact ion work like hiring, st af f ing,
t raining, benefit facilit ies management
et c. That t akes al most 80% of t ime
and at t ent ion. So, at present many
f irms are opt ing f or out sourcing of
t hese administ rat ive j obs as a t ime
saving and cost cut t ing measure. In
out sourcing t he f irms get t heir HR
act ivit ies done out side by suppl iers
or agenci es on a cont r act basi s.
Empl oyee hi r i ng, t r ai ni ng and
devel opment , mai nt enance of
st at ut or y r ecor ds ar e t he usual
f unct ions cont ract ed t o out siders f or
exampl e P&G has a signed a 10 year,
$400mil l ion deal wit h IBM t o handl e
empl oyee services. Out sourcing al so
result s in increased efficiency & bet t er
services.
However out sour ci ng of j obs i s
beneficial only at t he operat ional level.
At higher l evel s where t he st rat egies
are f ormul at ed, t he st rat egic pl ans
and ot her l ong t er m pl ans ar e
devel oped, act i vi t i es can’ t be
out sourced. Ot herwise t he gl ory and
i mpor t ance of t he HR depar t ment
wil l be endangered. Even now many Feature
f irms don’ t maint ain HR depart ment Article
as t hey out source t heir HR act ivit ies.
So, it is a big chal l enge bef ore t he
HR pr act i t i oner s t o pr ove t he
import ance of t he HR f unct ion and
save it f rom ident it y crisis.
z Business Process
Reengineering
Now a days mor e and mor e
organizat ions are going f or Business
Process Reengineering i. e. , reducing
t he business processes t o t ransf orm
t hem and i mpr ove t he l evel of
performance. The main purpose behind
Business Process Reengineering is t hat
it should address t o issues like cust omer At higher levels where
sat isfact ion, compet it ion and changing the strategies are
economic climat e. In Business Process formulated, the
Reengi neer i ng sever al j obs ar e strategic plans and
combined int o one. The empl oyees other long term plans
are empowered enough t o t ake t heir are developed,
own decisions. Al so, t he cont rol s and activities can’t be
checks and ot her non val ue works outsourced. Otherwise
are minimized. The impl ement at ion the glory and
of t his reengineering process is al so importance of the HR
a big chal l enge f or HR pract it ioners. department will be
They must t ake a rat ional decision endangered.
i f t hey r equi r e Busi ness Pr ocess
Reengineering f or t heir organizat ion
or not . While going for Business Process
Reengineering it requires redesigning
and reorchest rat ing of t he present
syst em. So, t he HR managers shoul d
have a cl ear underst andi ng of t he
current inst al l ed base of inf ormat ion
syst em appl icat ions and dat abases.
They shoul d al so benchmar k t he
t echnol ogy and procedures of t heir
f i r m agai nst t he best compet i t or.
They shoul d al so have passi onat e
leadership qualit ies and organizat ional
commit ment . They are al so required
57
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Feature t o balance t he business process changes Knowl edge gi ves cr eat i vi t y and
Article wit h simul t aneous cul t ural changes. innovat ive ideas. It also provides logical
z Knowledge Management base for decision making and increases
t he speed of execut i on of t hese
The knowl edge asset of t he company
decisions. So, it is a big chal l enge
and it s people is becoming increasingly
f or HR managers t o manage t his asset
crucial t o it s compet it ive well-being.
or r esour ce ef f ect i vel y i n t he
As st at ed by one expert part icipant
or gani zat i on.
i n A 21st Cent ury Vi si on (Rot hwel l ,
1996d), “ Business goes where skil l s Changing Role of HR
and knowledge are available-‘ t he new “ Organizat ions are ent ering int o an
capi t al i sm’ . ” er a of near l y const ant t ur bul ent
Right now product ivit y of knowl edge changes, and i n t hi s “ per manent
and knowl edge workers has repl aced whi t ewat er ” , i ndi vi dual s must be
capit al and t echnology as t he decisive imaginat ive, creat ive and cont inuous
f act or s f or t he success of t he l earners”
organizat ion. Anot her expert opinion In f ut ure t he HR pract i t i oners wi l l
about t he changi ng busi ness be conf r ont i ng wi t h compl i cat ed
environment is t hat “ Technology based si t uat i ons and bi gger chal l enges.
... productivity of
compet i t i on woul d be repl aced by Accordi ngl y, t hey wi l l be assumi ng
knowledge and peopl e based compet i t i on because new roles and responsibilit ies. As t he
knowledge workers peopl e cant be imit at ed in cont rast approaches and t rends are changing
has replaced capital t o t echnol ogy, management and i n t he corporat e worl d, so t he HR
and technology as the business processes” . pr act i t i oner s ar e al so r equi r ed t o
decisive factors for
the success of the Changing Role of HR
organization.
Yesterday Today Tomorrow
Success Business j udgement Inf ormat ion Flexibilit y
f act ors Int uit ion St rat egic Pl an Agilit y
Mi ssi on Speed
Organizat ional Pat ernalist ic Prof essional Empowered
St yle Learning Vibrant
Employees Hungry, Naked & Thinking and Fully evolved,
considered Def enseless Rat ional being complet ely sat isf ied,
as . . creat ures mat ure human beings
Mot ivat ional Driving peopl e Driving peopl e People drive
Met hods t hrough basic t hrough social & Themsel ves
needs int ellect ual needs
Rol e of Provide peopl e wit h Mot ivat e by As a Change Agent
HR f ood, cl ot hing and providing ef f ect ive As a Innovat or
shelt er f air appraisal s and As a St rat egic
compensat ion syst em Part ner

58
 LEADING FOR THE FUTURE - ROLE OF HR : BANERJEE & SINGH
change t hei r vi si on and appr oach
t owards t heir work. Today, it s highl y
chaot ic sit uat ion in t he market and
t he managers t hriving on chaos can
onl y survive. So, t hey need t o adapt
t hemsel ves t o t he changing business
environment f or which t hey shoul d
have t he clear underst anding of what
rol es and responsi bi l i t i es t hey are
expect ed t o perf orm.
HR Pract it ioners Î HR Leaders
(Now) (Fut ure)
Til l now t he HR managers were HR
pr act i t i oner s who f ocused on t he
t radit ional HR f unct ional areas. But
now onwards t hey have t o pl ay t he
rol e of HR Leaders who can f it t he
HR f unct ions t o business st rat egies
and busi ness st r at egi es t o t he
advant ages pr ovi ded by t he
organi zat i on‘ s peopl e.
In t oday’ s corporat e we don’ t require
mere managers rat her l eaders who
have t he capabil it y t o conquer t he
sea. Wit h t he business becoming hi-
t ech and changing rapidly, we require
dif f erent set of l eadership qual it ies
t o be on t he success side.
Albert A. Vicere of Pennysylvania St at e
Universit y present ed his f indings on
t he 10 most import ant compet encies
of HR l eaders as f ol l ows:
¾ He is commit t ed t o t he success
of t he organi zat i on.
¾ He act s in a manner t hat inst ills
t r ust .
¾ He is an ef f ect ive l eader.
¾ He exhi bi t s hi gh st andards of
per f or mance.
¾ He can manage conf l i ct s
effect ively.
¾ He works ef f ect ively wit h ot her Feature
member s out si de t he HR Article
f unct i on.
¾ He r ecr ui t s and sel ect s hi gh
qual it y prof essional s.
¾ He communi cat es ef f ect i vel y
bot h oral l y and in writ ing.
¾ He under st ands t he over al l
corporat e mi ssi on.
¾ He devel ops t he HR pl ans t hat
are clearly linked t o t he mission
and st rat egy of business unit s.
From t he f indings of Al bert A. Vicere
we can ident if y and out l ine cert ain
qual i t i es and compet enci es of t he
HR managers as f ol l owing: In today’s corporate
¾ Leadershi p we don’t require mere
¾ Highl y assert ive managers rather
¾ Ri sk t aker s
leaders who have the
capability to conquer
¾ High int erest in business
the sea. With the
¾ High int erest in HR issues business becoming hi-
¾ Opport unit y sensing tech and changing
¾ Flexible rapidly, we require
¾ Weal t h creat ing mind different set of
¾ Quest f or knowl edge leadership qualities to
¾ Emot ional connect edness
be on the success side.
The rol e of t he HR managers wil l be
mul t if acet ed. Apart f rom pl aying t he
role of HR leaders, t hey will be required
t o perform many more responsibilit ies.
The next i mpor t ant r ol e t hey wi l l
be pl aying is t hat t hey wil l serve as
t he Change Agent s. They shoul d
f acilit at e t he change in such a manner
t hat it does not creat e any hindrances
i n t he pat h of success of t he
organizat ion. Only t hen t hey can assure
bet t er product ion l evel s and bet t er
ser vi ces.
The HR l eaders shoul d devel op an
59
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature int egrat ed approach t o management
Article because t he HR is regarded as a core
act i vi t y rat her t han bei ng a si ngl e
f unct ion. It af f ect s all ot her f unct ions
of t he management . Be it pl anning,
organizing, leading or cont rolling, t he
HR i s cruci al t o every f unct i on. It
al so shapes t he company’ s val ues.
In part icular, t his can have an impact
on cust omer services.
The HR managers are al so required
t o act as Mediat ors or Consul t ant s.
They have t he r esponsi bi l i t y of
bal anci ng t he new and emer gi ng
aspirat ions and requirement s of t he
company and t he individual .
... the HR is regarded The HR managers wil l al so be pl aying
as a core activity a l eading rol e in t he organizat ion as
rather than being a t he St rat egy Builders. New st rat egies
single function. It and innovat ive st yles will be required
affects all other in t he organizat ion t o address issues
functions of the like globalizat ion, changing t echnology,
management. Be it speed, cost cont ainment et c. This will
planning, organizing,
leading or
controlling, the HR is
References :
crucial to every
function. 1. Ashwat happa, K(2006), “ Human
Resour ce And Per sonnel
Management ” , Tat a McGraw Hill
2. Bhat t acharya, Prasenj it (April ,
2007), Human Capit al , Vol . 10,
No. 11
3. Bl ass, R. Fr ed And Fer r i s,
R. Ger al d( 2007) , “ Leader
Reput at i on: The Rol e of
Ment or i ng, Pol i t i cal Ski l l ,
Cont ext ual Lear ni ng And
Adapt at ion” , Human Resource
Management , Vol . 46, No. 1
4. Joynt , Pat And Mort on Bob(2005),
60
requi re a very prof essi onal , hi ghl y
qualif ied, f ocused and creat ive t hink
t ank or pol icy makers who can t hink
globally even while act ing locally. Their
speed and precision wil l t ake t he HR
funct ions t o new height s and will always
keep t hem in t he l eading posit ion.
Finally, t he HR managers are t he Coach
t o t heir subordinat es. They have t o
buil d a t rust rel at ionship wit h t heir
subordinat es f or ef f ect ively coaching
t hem. It s main purpose is t o buil d
t he capabilit y in t he person. At t imes
t hey may be required t o give feedbacks
which may not be pl easant . But it
shoul d not resul t in conf ront at ion.
Unl i ke t eachi ng or ment or i ng, i n
coaching t he HR managers shoul d t ry
t o derive t he solut ion from t he coachee
i t sel f . Thei r mai n r esponsi bi l i t y i s
t o conver t t he pot ent i al i nt o
per f or mance.
“ The Global HR Manager” , Jaico
Publ ishing House
5. Si ngh, Kavi t a( 2005) ,
“ Or gani zat i on Change And
Devel opment ” , Excel Books
6. Singh, Prit am And Bhandarkar,
Asha(14 March, 2007), Lect ures
i n Nat i onal Semi nar On
“ Organisat ional St rat egies And
Processes for Meet ing Challenges
Of Growt h” , MTI, SAIL(Ranchi)
7. St oner, James A. F, Fr eeman,
R. Edward And Gil bert , Daniel , R
(2002), “ Management ” , Prent ice
Hal l of India
 VALUECREATIONANDSUSTAINABLECOMPETITIVEADVANTAGEFORCORPORATELEADERSHIP: CHOWDHURY

Value Creation and Sustainable Competitive Feature

Advantage for Corporate Leadership Article

B. Chowdhury*

Abst ract
Two f i r ms compet e i n t he same i ndust r y and bot h have many st r engt hs i n a var i et y
...the …process of
of f unct ional areas: operat ions, logist ics and so on. However, one of t hese f irms out perf orms
t he ot her by a wi de mar gi n over a l ong per i od of t i me. The f i r m bei ng i n t he same
industrial
mar ket makes di ssi mi l ar pr of i t s, and t hi s happens because t he f i r m i t sel f i s di ssi mi l ar. mutation….incessantly
Several st udies show t hat t he f irm is a more import ant source of prof it t han t he market revolutionizes the
. A f i r m i s an i nst i t ut i on t hat or gani zes pr oduct i on by i nt er nal i zi ng t he t r ansact i ons economic structure
r equi r ed t o pr oduce an out put . The pr ocess of pr oduct i on r equi r es t he cooper at i ve from within,
ef f or t of a number of owner s of pr oduct i ve r esour ces, and i n t hi s pr ocess t he f i r m can incessantly destroying
manage t he resources more ef f icient ly t han t he market result ing int o superior perf ormance the old one,
and cor por at e l eader shi p.
incessantly creating a
Key Words : Val ue chai n, l ogi st i cs, pr opr i et ar y new one. This process
of Creative
Destruction is the
essential fact about
capitalism.

Some t hi ngs ar e hur r yi ng i nt o economic act ivit y is t o creat e val ue.

exi st ence, and ot her s ar e hur r yi ng
out of i t . And t hat whi ch i s comi ng
i nt o exi st ence, par t i s al r eady
ext i ngui shed. Mot i ons and changes
are cont inual l y renewing t he worl d….
Roman Emper or Mar cus Aur el i us
Medi t at i ons (A. D. f our t h cent ur y)
The f undament al pur pose of al l
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○
The economi c val ue i s cr eat ed by
t he f i r ms and si mul t aneousl y
somewhere it is being dest royed.
. . . t he …pr ocess of i ndust r i al
mut at ion…. incessant ly revolut ionizes
t he economic st ruct ure f rom wit hin,
incessant l y dest roying t he ol d one,
incessant l y creat ing a new one. This
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

* Sr. Manager (Acad.) & Sr. FM, MTI, SAIL, Ranchi

61
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature pr ocess of Cr eat i ve Dest r uct i on i s
Article t he essent ial f act about capit al ism.
It is what capit al ism consist s in and
what every capit alist concern has got
t o l ive in (Schumpet er, 1938).
In t wo maj or st udies, publ ished in
2002 and 2005 respect ivel y, Robert
Wiggins of t he Universit y of Memphis,
and Tim Ruef l i, of t he Universit y of
Texas, show t hat whi l e many
compani es can manage shor t -t er m
burst s of high perf ormance, onl y a
f ew sust ain it in t he l onger run. The
aut hors st rat if ied a sampl e of 6, 772
companies over 23 years int o superior,
modal ( mi ddl e) , and i nf er i or
perf ormers in t heir indust ries. Onl y
5 percent of t hese companies remained
All sources of
in t he superior st rat um f or 10 years
competitive or more. Furt hermore, t he superior
advantage are per f or mer s exper i ence lit t le
temporary, and very composi t i on st abi l i t y i . e. , t he
few companies can perf ormers change over t i me.
create new sources of
Wi ggi ns and Ruef l i concl uded t hat
advantage after their
t he short -t erm perf ormers l ost t heir
historic sources
way when t he environment shif t ed.
decline
Al l sources of compet it ive advant age
ar e t empor ar y, and ver y f ew
companies can creat e new sources
of advant age af t er t hei r hi st or i c
sources decl ine (Beinhocker, 2006).
Taking anot her angl e on t he issue,
Fost er and Kaplan point out in Creat ive
Dest ruct ion t hat only a small populat ion
of companies has endured f or a l ong
t i me: f or exampl e, of t he ori gi nal
Forbes 100 companies, in 1917, onl y
13 have survi ved i ndependent l y t o
t he present day.
Two f i r ms compet e i n t he same
indust ry and bot h have many st rengt hs
i n a var i et y of f unct i onal ar eas:
62
oper at i ons, l ogi st i cs and so on.
However, one of t hese f i r ms
out per f or ms t he ot her by a wi de
margin over a l ong period of t ime.
The f irms being in t he same market
make di ssi mi l ar pr of i t s, and t hi s
happens because t he firms t hemselves
are dissimil ar. Several st udies show
t hat t he f i rm i s a more i mport ant
sour ce of pr of i t t han t he mar ket
(Rumelt , 1991 and Roquebert , Philips
and West f al l , 1996).
Firm as a Source of Profit: A f irm
i s an i nst i t ut i on t hat or gani zes
pr oduct i on by i nt er nal i zi ng t he
t ransact ions required t o produce an
out put . The process of product i on
r equi r es t he cooper at i ve ef f or t of
a number of owners of product i ve
resources, and in t his process t hree
problems arise and t he f irm can of t en
deal wit h t hem more ef f icient l y t han
t he market (Al chi an and Demest z,
1972) .
1. Mobilizing, coordinat ing and
motivating resources : and t he
f irst is t he issue of mobil izing,
coor di nat i ng and mot i vat i ng
resources. The f irm deal s wit h
t hese issues by est abl ishing an
archit ect ure t hat brings mult iple
owners of product ive resources
int o long-t erm relat ionships wit h
on anot her.
2. Information asymmetry : The
f i r m sol ves t he pr obl em of
i nf or mat i on asymmet r y by
building a reput at ion t hat bridges
t he i nf ormat i on gap bet ween
t he f i rm and t hose who have
not deal t wit h it bef ore, and
makes possible t ransact ions t hat
may not t ake pl ace ot herwise.
 VALUECREATIONANDSUSTAINABLECOMPETITIVEADVANTAGEFORCORPORATELEADERSHIP: CHOWDHURY
3. Know-how : The f i r m sol ves
t he issue of collect ive knowledge
of product ion process.
Hence when t wo or more owners of
product ive resources have t o work
t oget her t o pr oduce an out put , a
f irm of t en becomes a more ef f icient
al t ernat ive t o t he market , because
i t s ar chi t ect ur e, r eput at i on, and
knowl edge enabl e t he f i r m t o use
t hese resources more ef f icient ly t han
t he market . The archit ect ure of t he
f irm reduces t he product ion l osses
t hat may arise if t he owners of t hese
resources t ransact wit h one anot her
t hrough t he market . It s reput at ion
minimizes t he product ion l osses t hat
woul d arise if product ion does not
t ake pl ace at al l , because of an
i nf or mat i on asymmet r y bet ween
buyer s and sel l er s. And t he f i r m’ s
knowl edge of how product ion shoul d
be carried out enables t he product ive
resources t o produce more t han t hey
woul d ot herwi se (Kay, 1993).
Assets and Value: As t he economist
def ines it , t he f irm is an inst it ut ion
t hat pr oduces or add val ue, by
t ransf orming a set of input s int o a
product , or a form considered valuable
by t he buyer, and mar ket i ng or
reaching t he product f rom t he f irm
t o t he buyer. The f i rm does so by
usi ng t hr ee t ypes of pr oduct i ve
resources: it s archit ect ure, reput at ion,
and knowledge, or what Richard Caves
calls it s propriet ary asset s, it s st rat egic
asset s and non-propri et ary f act ors
of product i on (Caves, 1996).
z The def ining charact erist ics of
propriet ary asset s are t hat t hey
are int angibl e, creat ed by t he
f irm it sel f , unique in t he sense Feature
t hat no ot her f i rm has t hem, Article
and avail abl e f or t he excl usive
use of t he f i rm.
z St rat egic asset s are simil ar t o
propriet ary asset s in t hat t hey
are al so unique and avail abl e
f or t he exclusive use of t he f irm.
But t hey are al so dissimil ar in
t hat t hey may be int angibl e or
int angibl e, and are not creat ed
by t he f i rm, but acqui red by
buying or hiring t hem f rom t he
market . Exampl es are an iron
or e mi ne owned or t aken on
l ease by a st eel company.
z Non-propriet ary f act ors are not
uni que, i n t hat t hey ar e t he The architecture of
same for all firms and are equally
the firm reduces the
avail abl e t o al l f irms who can
production losses that
buy or hi r e t hem f r om t he
may arise if the
mar ket .
owners of these
A f i rm i s di st i ngui shed f rom ot her resources transact
f irms by it s propriet ary asset s. These with one another
asset s do not par t i ci pat e i n t he through the market.
product ion process direct ly, but work
t hrough t he non-propriet ary f act ors
employed by t he f irm. Toget her, t hey
det ermine t he t echnology of t he f irm,
or t he di st i nct i ve way i n whi ch i t
uses non- pr opr i et ar y f act or s t o
pr oduce an out put . They al so
det ermine t he f irm’ s capabil it ies, or
t he ki nd of t hi ngs i t can do. Most
i mport ant l y, t hey can generat e an
economic prof it f or t he f irm, even
when it is not prot ect ed by st ruct ural
or any ot her ext ernally imposed ent ry
bar r i er s.
Value-Chain Analysis : Val ue-chain
anal ysis views t he organizat ion as a
63
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature sequent ial process of val ue-creat ing
Article act ivit ies. The approach is usef ul f or
underst anding t he buil ding bl ocks of
compet it ive advant age. In compet it ive
t erms, value is t he amount t hat buyers
are wi l l i ng t o pay f or what a f i rm
pr ovi des t hem. Val ue i s measur ed
by t ot al revenue, a ref l ect ion of t he
price a f irm’ s product commands and
t he quant i t y i t can sel l . A f i r m i s
prof it able t o t he ext ent t hat t he value
it receives exceeds t he t ot al cost s
invol ved in creat ing it s product or
services. Creat ing val ue f or buyers
t hat exceeds t he cost s of product ion
(i. e. margin) is a key concept used
i n anal yzi ng a f i r m’ s compet i t i ve
posit ion. Port er described t wo different
Creating value for cat egori es of act i vi t i es. Fi rst , f i ve
buyers that exceeds primary act ivit ies—inbound logist ics,
the costs of oper at i ons, out bound l ogi st i cs,
production (i.e. market ing and sal es, and service –
margin) is a key cont ribut e t o t he physical creat ion
concept used in of t he product or servi ce, i t s sal e
analyzing a firm’s and t ransf er t o t he buyer, and i t s
competitive position. service af t er sal e. Second, support
act ivit ies — procurement t echnol ogy
devel opment , human r esour ce
management , and f irm inf rast ruct ure
— eit her add val ue by t hemsel ves or
add val ue t hr ough i mpor t ant
r el at i onshi ps wi t h bot h pr i mar y
act ivit ies and ot her support act ivit ies.
Primary Activities : Inbound Logistics
z Locat ion of dist ribut ion facilit ies
t o minimize shipping t imes.
z Excellent mat erial and invent ory
cont rol syst ems.
z Syst em t o reduce t imes t o send
“ ret urns” t o suppl iers.
z Warehouse l ayout and designs
64
t o i ncr ease ef f i ci ency of
oper at i ons f or i ncomi ng
mat er i al s.
Primary Act ivit ies: Operat ions
z Ef f i ci ent pl ant oper at i ons t o
mi ni mi ze cost s.
z Appropriat e level of aut omat ion
i n manuf act ur i ng.
z Qual i t y pr oduct i on cont r ol
syst ems t o r educe cost s and
enhance qual it y.
z Ef f i ci ent pl ant l ayout and
workf l ow desi gn.
Pr imar y Act ivit ies: Out bound
Logistics
z Ef f ect ive shipping processes t o
pr ovi de qui ck del i ver y and
mi ni mi ze damages.
z Ef f i ci ent f i ni shed goods
warehousi ng processes.
z Shipping goods in large lot sizes
t o minimize t ransport at ion cost s.
z Qual i t y mat er i al handl i ng
equi pment t o i ncr ease or der
pi cki ng.
Primary Act ivit ies: Market ing and
Sales
z Highly mot ivat ed and compet ent
sal es f orce.
z Innovat i ve appr oaches t o
promot i on and advert i si ng.
z Sel ect ion of most appropriat e
dist ribut ion channel s.
z Proper ident ificat ion of cust omer
segment s and needs.
z Ef f ect i ve pri ci ng st rat egi es.
 VALUECREATIONANDSUSTAINABLECOMPETITIVEADVANTAGEFORCORPORATELEADERSHIP: CHOWDHURY
Primary Act ivit ies: Service
z Ef f ect ive use of procedures t o
sol icit cust omer f eedback and
t o act on i nf ormat i on.
z Quick response t o cust omer needs
and emergenci es.
z Appr opr i at e war r ant y and
guarant ee pol icies.
Suppor t Act ivit ies: General
Administ rat ion
z Ef f ect i ve pl anni ng syst ems t o
at t ai n over al l goal s and
obj ect i ves.
z Abil it y t o ant icipat e and act on
key environment al t rends and
event s.
z Abil it y t o obt ain l ow-cost f unds
f or capex and working capit al .
Suppor t Act ivit ies: General
Administ rat ion
z Abi l i t y t o coor di nat e and
int egrat e act ivit ies across t he
“ val ue syst em” .
z Hi ghl y vi si bl e t o i ncul cat e
organizat ional cult ure, reput at ion
and val ues.
Support Activities: Human Resource
Management
z Ef f ect i ve r ecr ui t i ng,
devel opment , and r et ent i on
mechani sms f or empl oyees.
z Qual i t y wor k envi r onment t o
maxi mi ze over al l empl oyee
per f or mance.
Suppor t Act ivit ies: Technology
Development
z Ef f ect i ve R& D act i vi t i es f or
process and product init iat ives. Feature
z Positive collaborative relationships Article
bet ween R& D and ot her
depar t ment s.
Suppor t Act ivit ies: Technology
Development
z St at e-of -t he-art f acil it ies and
equi pment .
z Cul t ure t o enhance creat ivit y
and innovat ion.
z Abilit y t o meet crit ical deadlines.
Support Act ivit ies: Procurement
z Pr ocur ement of r aw mat er i al
input s t o opt imize qual it y and
speed, and t o mi ni mi ze t he
associat ed cost s.
z Devel opment of col l aborat i ve From a business
“ wi n-wi n” r el at i onshi ps wi t h perspective, strategy
suppl iers. begins with the desire
z Effect ive procedures t o purchase of the organization to
advert ising and media services. outperform the
z Analysis and select ion of alt ernat e market.
sources of input s t o minimize
dependence on one suppl ier.
z Abi l i t y t o make pr oper l ease
versus buy decisions.
St r at egy and Business: Fr om a
business perspect ive, st rat egy begins
wit h t he desire of t he organizat ion
t o out perf orm t he market . A st rat egy,
in t his cont ext , is def ined as a set
of concr et e pl ans t o hel p t he
or gani zat i on accompl i sh t hi s goal .
Fundament al l y, a st r at egy i s a
commi t ment t o undert ake one set
of act ions rat her t han anot her, and
t his commit ment necessarily describes
t he al l ocat i on of r esour ces
(Ost er, 1999).
65
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature Two Primary Reasons for a Strategy:
Article
First , if what you do is not unique
i n some respect and everyone can
do it , t hen you cannot make money
at i t (Ost er, 1999).
Second, no advant age i s
per manent l y sust ai nabl e i n a
compet it ive market t hus sat isf act ion
wit h t he st at us quo is a recipe f or
f ail ure as compet it or wil l event ual l y
f ind a means t o capt ure your market
shar e (Hunt er, 2000).
A Resource-based View (RBV) of
t he Firm: We have st ruct ured our
st udy on model of Resource-Based
Vi ew (RBV) of t he f i r m (Penr ose,
... resources by 1959; Barney, 1991). The resource-
themselves typically based view (RBV) of t he f irm combines
do not yield t wo per spect i ves: (1) t he i nt er nal
analysis of phenomena wit hin t he f irm
advantage.
Sustainable and (2) an ext ernal anal ysis of t he
advantages are compet i t i ve envi ronment (Col l i s &
created through the Mont gomery, 1995; Barney, 1991). It
bundling of several is a very usef ul f ramework f or gaining
resources in unique i nsi ght s on why a f i r m i s mor e
prof it abl e t han ot hers.
combinations.
A firm possesses t hree key t ypes
of resources: Tangi bl e r esour ces,
int angible resources and organizat ional
capabil it ies. It is import ant t o not e
t hat resources by t hemselves t ypically
do not yiel d advant age. Sust ainabl e
advant ages are creat ed t hrough t he
bundling of several resources in unique
combi nat i ons.
The resource-based view (RBV) of
the firm combines two perspectives:
z The i nt er nal anal ysi s of
phenomena wit hin a company
and
66
z An ext er nal anal ysi s of t he
i ndust r y and i t s compet i t i ve
envi r onment .
z It goes beyond t he t radit ional
SWOT anal ysi s by i nt egr at i ng
i nt er nal and ext er nal
perspect ives.
z It i s a usef ul f r amewor k f or
gai ni ng i nsi ght s on why some
f irms are more prof it abl e t han
ot her s.
Types of Firm Resources: Tangible
Resources
z Asset s t hat are easy t o ident if y
are cal l ed t angibl e resources.
z They i ncl ude physi cal and
f i nanci al asset s t hat an
organizat ion uses t o creat e value
f or i t s cust omers.
Types of Firm Resources: Intangible
Resources
z Much mor e di f f i cul t f or
compet it ors t o account f or or
imit at e are int angible resources,
which are t ypical l y embedded
in unique rout ines and pract ices
t hat have evol ved and
accumul at ed over t ime.
z A f irm’ s cul t ure may al so be a
r esour ce t hat pr ovi ded
compet i t i ve advant age.
Distinctive Capabilities: Intangible
Resources
z Dist inct ive capabil it ies are t he
gl ue t hat hol ds t hese asset s
t oget her and enabl e t hem t o
be depl oyed advant ageousl y.
z Each of t hese capabil it ies is a
compl ex bundl e of ski l l s and
 VALUECREATIONANDSUSTAINABLECOMPETITIVEADVANTAGEFORCORPORATELEADERSHIP: CHOWDHURY
knowl edge, exercised t hrough
t he organizat ional processes t hat
enable a business t o coordinat e
act ivit ies, ut ilize it s asset s, and
cont inuously learn and improve.
z Capabil it ies dif f er f rom asset s
i n t hat t hey ar e so deepl y
embedded in t he organizat ional
rout ines and pract ices t hat t hey
cannot be t raded or imit at ed
(Day, 2006).
Types of Fir m Resour ces:
Organizational Capabilities
z Firm compet ences or skil l s t he
f irm empl oys t o t ransf er input s
t o out put s.
z Capaci t y t o combi ne t angi bl e
and int angibl e resources, using
organizat ional processes t o at t ain
desired end. Exampl es:
z Out st anding cust omer service.
z Excellent product development
capabil it ies.
z Abil it y t o mot ivat e and ret ain
human capit al .
z Innovat iveness of product s and
ser vi ces(Bar ney, 1991).
Fir m Resour ces and Sust ainable
Compet it ive Advant age :
z Resources al one are not a basis
f or compet it ive advant ages, nor
are advant ages sust ainable over
t i me.
z A resource or capabil it y hel ps
a f irm t o increase it s revenue
or t o l ower cost but t he f irm
der i ves onl y a t empor ar y
advant age because compet it ors
quickly imit at e or subst it ut e f or
it .
For a resource t o provide a f irm Feature
wi t h pot ent i al f or a sust ai nabl e Article
compet it ive advant age, it must have
f our at t r i but es.
z Fi r st , t he r esour ce must be
val uabl e i n t he sense t hat i t
expl oi t s opport uni t i es and/ or
neut ralizes t hreat s in t he f irm’s
envi r onment .
z Second, it must be rare among
t he f irm’ s current and pot ent ial
compet i t or s.
z Thi r d, t he r esour ce must be
di f f i cul t f or compet i t or s t o
i mi t at e.
z Fourt h, t he resource must have
A resource or
no st r at egi cal l y equi val ent
capability helps a
subst i t ut e.
firm to increase its
Four Cr it er ia f or Assessing revenue or to lower
Sust ainabilit y of Resour ces and cost but the firm
Capabilit ies: derives only a
Is t he Resource Valuable? temporary advantage
z Organizat ional resources can be
because competitors
quickly imitate or
source of compet it ive advant age
onl y when t hey are val uabl e. substitute for it.
z Resources are valuable when t hey
enabl e a f irm t o f ormul at e and
i mpl ement st r at egi es t hat
i mpr ove i t s ef f i ci ency or
ef f ect i veness.
Is t he Resource Rare?
If compet i t or s or pot ent i al
compet i t ors al so possess t he same
val uabl e resource, it is not a source
of a compet it ive advant age because
al l of t hese f irms have t he capabil it y
t o expl oit t hat resource in t he same
way.
Common st r at egi es based on
67
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature such a resource woul d give no one
Article f i rm an advant age. For a resource
t o provi de compet i t i ve advant age,
it must be uncommon, t hat is, rare
rel at ive t o ot her compet it ors.
Can the Resource be Imitated Easily?
z Inimit abilit y is t he key t o value-
creat ion because it const rains
compet i t i on.
z If a resource is inimit abl e, t hen
any prof it s generat ed are more
l ikel y t o be sust ainabl e.
z Physical Uniqueness: by definit ion
is inherent ly difficult t o copy,e.g.
mi ni ng r i ght s.
z Pat h Dependency: This simpl y
means t hat resources are unique
Causal ambiguity is and t heref ore scarce because
deepened when the all t hat has happened along t he
capability requires a pat h f ol l owed in t hei r
complex pattern of
devel opment and/ or
coordination among
accumul at i on. Compet i t or s
diverse types of cannot go out and buy t hese
resources. resources quickl y and easil y.
z Causal Ambiguit y: This means
t hat t he woul d-be compet it ors
may be t hwart ed because it is
i mpossi bl e t o di sent angl e t he
causes of eit her what t he valuable
r esour ce i s or how i t can be
r ecr eat ed.
z Soci al Compl exi t y: Exampl es
incl ude int erpersonal rel at ions
wi t h t he managers i n a f i rm,
it s cul t ure, and it s reput at ion
wit h suppl iers and cust omers.
Causal Ambiguit y
z The compet i t or ’ s move t o
imit at e t he st rat egy of t he f irm
68
is impeded if t here is ambiguit y
about t he causal connect i ons
bet ween t he act ions of t he f irm
and resul t s.
z The f irm’ s capabil it y embodies
t aci t knowl edge based on
l ear ni ng by doi ng or usi ng,
accumulat ed t hrough experience
and ref ined by pract ice.
z The knowl edge base may be so
t acit and impl icit t hat it resist s
al l ef f or t s at codi f yi ng t he
r out i nes, deci si on r ul es, and
prot ocols t hat make t he syst em
wor k
z Causal ambiguit y is deepened
when t he capabil it y requires a
complex pat t ern of coordinat ion
among di ver se t ypes of
r esour ces.
z This means t hat f ew individuals
have t he compl et e grasp of t he
ent ire syst em. Thus a rival cannot
copy t hrough direct observat ion
and may st il l not grasp of t he
funct ioning of t he capabilit y even
af t er hiring away key employees
(Day, 2006).
Time Compression Diseconomies
z Some resources can be developed
onl y pai nst aki ngl y over l ong
per i ods of t i me. E. g. , a
reput at ion for except ional qualit y
r equi r es consi st ency and
cont i nuous i mprovement over
a l ong period of t ime.
z A r i val t hat t r i es t o r api dl y
achieve t he same result t hrough
a crash programme is l ikel y t o
f ind it has incurred much higher
 VALUECREATIONANDSUSTAINABLECOMPETITIVEADVANTAGEFORCORPORATELEADERSHIP: CHOWDHURY

cost s t han if it had made t he i nf or mat i on, knowl edge, et c. Feature

same expendit ure over a longer cont rol l ed by a f irm t o conceive of Article
per i od (Ghemawat , 1991). and implement st rat egies t hat improve
it s ef f iciency and ef f ect iveness (Daf t ,
Are Substitutes Readily Available?
1983). As st at ed earl ier, a f irm has
z A f irm resource is a source of t hree t ypes of resources for evaluat ion:
sust ai nabl e compet i t i ve
( a) Tangible Resources
advant age when t he st rat egically
i. Financial
equival ent resources are rare
or inimit abl e. ii. Physi cal : Moder n pl ant and
facilit ies, st at e-of-art machinery
z Two valuable f irm resources are
and equi pment .
st rat egi cal l y equi val ent when
each one can be expl oi t ed iii. Technol ogi cal : Innovat i ve
separ at el y t o i mpl ement t he product ion processes
same st r at egy. i v. Or gani zat i onal : Ef f ect i ve
Core Compet ence st r at egi c pl anni ng pr ocesses,
z Core compet encies are collect ive excellent evaluat ion and cont rol
l ear ni ng of t he or gani zat i on, syst ems
Core competence does
especi al l y how t o coor di nat e ( b) Int angible Resources not diminish with
di ver se pr oduct i on ski l l s and
i. Human: Exper i ence and use. Unlike physical
int egrat e mul t ipl e st reams of
capabilit ies of employees, t rust , assets, which do
t echnol ogies.
managerial skil l s, f irm specif ic deteriorate over time,
z Cor e compet ence is
pract ices and procedures. competencies are
communi cat i on, i nvol vement ,
ii. Innovat i on and cr eat i vi t y: enhanced as they are
and a deep commi t ment t o
Technical and scient if ic skil l s, applied and shared
worki ng across organi zat i onal
boundari es. innovat ion capacit ies.
z Cor e compet ence does not iii. Reput at i on: Reput at i on wi t h
diminish wit h use. Unlike physical cust omer s f or qual i t y and
asset s, which do det eriorat e over r el i abi l i t y, r eput at i on wi t h
t ime, compet encies are enhanced suppliers f or f airness, non-zero-
as t hey are appl ied and shared sum rel at ionship.
(Prahal ad and Hamel , 1990). ( c) Organizational Capabilities
Conclusion i. Firm compet ences or skil l s t he
Organizational Capabilities f irm empl oys t o t ransf er input s
The organizat ional capabil it ies of a t o out put s.
f i r m can be eval uat ed under t he ii. Capaci t y t o combi ne t angi bl e
f ramework of Resource –Based View and int angibl e resources, using
of t he f irm. Firm resources incl ude organizat ional processes t o at t ain
all asset s, capabilit ies, organizat ional desired end.
pr ocesses, firm at t r i but es,

69
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Feature Fact ors of Performance: A firm’ s
Article performance is affected by three
broad factors or resources:
( a) Tangible Resources: As st at ed
t hese are physical and f inancial
asset s t hat t he f i r m uses t o
creat e val ue f or it s cust omers.
Thi s i ncl udes t he pr i mar y
act ivit ies of t he value chain i. e.
t he i nbound l ogi st i cs and
out bound logist ics (Port er, 1985).
( b) Int angible Resour ces: Much
mor e di f f i cul t f or a f i r m t o
account f or or imit at e are t he
int angible resources, which are
t ypical l y embedded in unique
rout ines and pract ices t hat have
Organizational
evol ved and accumul at ed over
capabilities are
t i me. These i ncl ude human
distinctive
resources (e. g. , experience and
capabilities that glue
capabilit ies of employees, t rust ,
and hold the tangible
ef f ect i veness of wor k t eams,
and intangible manageri al ski l l s), i nnovat i on
resources together and
r esour ces ( e. g. , t echni cal
enable them to be
expert ise, ideas), and reput at ion
deployed
resources (e. g. , brand name,
advantageously. r eput at i on wi t h suppl i er s f or
f airness and wit h cust omers f or
rel iabil it y and product qual it y.
A f irm’ s cul t ure may al so be a
r esour ce t hat pr ovi des
compet it ive advant age (Barney,
1986) .
( c) Organizat ional Capabilit ies:
Organizat ional capabil it ies are
dist inct ive capabilit ies t hat glue
and hol d t he t angi bl e and
i nt angi bl e resources t oget her
and enable t hem t o be deployed
advant ageousl y. Each of t hese
capabilit ies is a complex bundle
70
of skills and knowledge, exercised
t hr ough t he or gani zat i onal
pr ocesses t hat enabl e a f i r m
t o coordinat e act ivit ies, ut il ize
it s asset s, and cont inuously learn
and improve. Capabilit ies dif f er
f r om asset s i n t hat t hey ar e
so deepl y embedded i n t he
or gani zat i onal r out i nes and
pract ices t hat t hey cannot be
t raded or imit at ed (Day, 2006).
Capabil it ies are obscured f rom
vi ew because much of t hei r
knowl edge component is t acit
and di sper sed al ong f our
di mensi ons:
i. Accumul at ed empl oyee
knowl edge and skil l s.
ii. Knowl edge embedded i n
t echnical syst ems including
soft ware linked dat abases,
and f ormal procedures.
iii. Management syst ems t hat
exist t o creat e and cont rol
knowl edge.
i v. The val ue and norms t hat
dict at e what inf ormat ion
is t o be col l ect ed, what
t ypes are most import ant ,
and how i s t o be used
(Leonar d-Bar t on, 1992).
Anot her at t r i but e of di st i nct i ve
capabil it ies is t hat t hey are robust
and can be used in dif f erent ways
t o speed t he f i rm’ s adj ust ment t o
changes in environment (Prahalad and
Hamel, 1990). Sust ainable advant age
and corporat e l eadership is creat ed
t hr ough t he bundl i ng of t hese
resources in unique combinat ion.
 VALUECREATIONANDSUSTAINABLECOMPETITIVEADVANTAGEFORCORPORATELEADERSHIP: CHOWDHURY
References :
z Al chi an, A. A. and H.
Demset z(1972), “ Pr oduct i on,
Inf ormat ion Cost s and Economic
Or gani zat i ons” , Amer i can
Economic Review, Vol . 62
z Barney, J B, “ Firm Resources and
Sust ai ned Compet i t i ve
Advant age” , Jour nal of
Management 17(1991).
z Caves, R.E. (1996), Mult inat ional
Ent erprise and Economic Analysis,
Cambridge: Cambridge Universit y
Press
z Day, G. S. ( 2006) , Dynami c
Compet it ive St rat egy, John Wiley
and Sons Inc.
z Ghemawat , Pankaj ( ! 991) ,
Commi t ment , Free Press new
Yor k.
Feature
z Kay, John (! 993), Foundat i on Article
of Cor por at e Success: How
Business St rat egies Add Val ue,
Oxf ord, Oxf ord Universit y Press.
z Penr ose, Edi t h ( 1995) , The
Theor y of t he Gr owt h of t he
Firm, Oxf ord, Oxf ord Universit y
Pr ess.
z Por t er, M. E. ( ! 985, ! 998)
Compet i t i ve Advant age, Fr ee
Pr ess, New Yor k.
z Prahal ad, C. K. and G. Hamel
(1990), “ The Core Compet ence
of t he Cor por at i on” , Har var d
Business Review, May –June.
z Rocquebert , J. A. , R. L. Phillips, Capabilities differ
and P. A. West fall (1996), Market s from assets in that
vs. Management : What Dri ves they are so deeply
Pr of i t abi l i t y?” St r at egi c embedded in the
Management Journal , Vol . 12.
organizational
routines and practices
that they cannot be
traded or imitated
71
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Readers' Developing Leaders for the Future : What

Forum large Organisation need to do

Shoeb Ahmed*

ABSTRACT
Lar ge bur eaucr at i c or gani sat i ons f aces t he chal l enge of r et ai ni ng l eader s acr oss t he
or gani sat i onal hei r ar chy as t hei r r ol es and i mpor t ance ar e get t i ng di mi ni shed i n t he
st ruct ural compl exi t y. A chal l enge t hat can be overcomed by devel opi ng f ut ure l eaders
who ar e al i gned t o t he over al l obj ect i ve and vi si on of t he company. In t hr i vi ng t o
... while some achi eve t hi s, HR and Communi cat i on syst ems comes i nt o pl ay t hat est abl i sh l eader shi p
leadership traits come power point s t hroughout t he organisat ion. By inst il l ing st rong communicat ion channel s,
with an individual st ruct ural f l exibil it y is brought and rul es and pol icies are reduced resul t ing int o bet t er
deci si ons and wel l i nf or med eml oyees. The HR f ocuses on t he HR Devel opment vi ewi ng
some need to be
empl oyees as asset s t o be nur t ur ed, appr ai sed and mot i vat ed.
developed and some
people are able to KeyWords : Fut ur e Leader shi p, Communi cat i on Syst em, HR Syst em
develop these traits
quickly and
effectively.

For a long t ime management t hinkers
and phi l osophers have debat ed on
whet her l eadership is an inborn t rait
or can it be t aught t o people t o become
leaders. I am in no posit ion t o conf irm
or deny ei t her but i t i s my bel i ef
t hat t he t r ut h l i es somewher e i n
bet ween t hese t wo ext remes. What
I mean is t hat whil e some l eadership
t rait s come wit h an individual some
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○
need t o be developed and some people
are able t o develop t hese t rait s quickly
and ef f ect ivel y. Furt her, l eadership
t rait s of pot ent ial l eaders who have
t he abilit y t o t ake on leadership t asks
needs t o be ident if ied, developed and
shar pened.
At t he out set , I woul d l ike t o st at e
t hat experience t el l s us t hat l arge
bureaucrat ic organizat ions, many a
○ ○ ○ ○ ○ ○ ○ ○

* Direct or (Commercial), SAIL, New Delhi

72
DEVELOPING LEADERS FOR THE FUTURE - WHAT LARGE ORGANISATION NEED TO DO : AHMED
t ime, have been known f or t he abilit y
t o suppress t his pot ent ial . This is a
management par adox whi ch ar i ses
in al l organizat ions as t hey grow in
size. Wit h Size, t he need f or st ronger
cont rols and a more def ined st ruct ure
arises. This l eads t o t he organizat ion
becoming more st ruct ured and policy
and pr ocedur es st ar t t aki ng
precedence over individual drive and
init iat ive. This sl owl y st art s t aking
away l eadership init iat ive f rom t he
execut i ng manager s as pol i ci es,
procedures and precedence become
t he guiding principl es and st art s t o
choke t he process of l eadership and
innovat ions. The paradox is t hat as
t he or gani zat i on gr ows i n si ze, i n
order t o ret ain it s creat ive and cut t ing
edge, t he need f or ef f ect ive l eaders
at different levels of hierarchy becomes
more pronounced. This is so because
t he leadership ef f ect of t he t op man/
t op management diminishes as t he
organizat ion grows l arger and more
of t en t han not t he general empl oyee
st art s l ooking up t o his immediat e
superior f or providing a l eadership
rol e. The rol e of t he t op l eader get s
primaril y f ocused on providing t he
l eader shi p vi si on. Thus , as an
organizat ion grows, it s need t o have
a number of l eaders who are al igned
t o t he overal l l eadershi p vi si on of
t he company and at t he same t ime
are able t o break it up int o act ionable
l eadershi p i ni t i at i ves i n t hei r area
i ncr eases. However, t he st r onger
cont rol syst ems & st ruct ures developed
by t he organi zat i on t o manage i t s
si ze al so manage t o suppr ess t he
l eader shi p i ni t i at i ve of t he f ut ur e
l eader s. Thi s i s t he par adox t he
organizat ion has t o manage and t he Readers'
ones who are abl e t o do so ret ain Forum
t heir compet it ive edge over a l onger
period of t ime. But t hen management
is al l about managing paradoxes and
t hi s i s where t he begi nni ng of t he
chal l enge t hat an organizat ion has
t o f ace in it s quest f or devel oping
f ut ure l eaders l ies.
The following issues need t o addressed
caref ul l y f or an organizat ion in t his
quest f or developing f ut ure leaders: -
1. How do you ident if y pot ent ial
l eaders at a st age earl y enough
t o be abl e nur t ur e t hem t o
become l eaders wel l in t ime? ... as an organization
grows, its need to
2. How t o you devel op a pot ent ial
have a number of
l eader int o a l eader. What kind
leaders who are
of t r ai ni ng and devel opment
aligned to the overall
process is needed?
leadership vision of
3. Can t hese be done onl y af t er the company and at
you have given him/ her a chance the same time are
at l eadershi p assi gnment and able to break it up
t heref ore, run t he risk and cost into actionable
of a f ail ure if t he accuracy of leadership initiatives
t he f irst t wo st ages is l ow?
in their area
4. How do you ensur e t hat t he increases.
st ruct ured operat ional st yl e of
l ar ge or gani zat i ons pr ovi des
enough f l exibil it y f or pot ent ial
leaders t o show t heir leadership
init iat ive?
To a l ar ge ext ent , t he answer t o
t hese l ies in t wo t hings: -
a) Hi ghl y evol ved and ef f ect i ve
communi cat i on syst em whi ch
cut s acr oss f unct i ons &
hierarchies and
b) Robust HR syst ems
The i mpor t ance of or gani zat i onal
73
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Readers' communi cat i on syst em i s wel l
Forum est ablished. In a organizat ional syst em
where communicat ion channel s are
st rong, t he need f or rigid pol icies,
procedures and st ruct ure is great l y
r educed. Ef f ect i ve communi cat i on
of organizat ional priorit ies and vision
ensur es t hat a l ar ge cr oss sect i on
of t he empl oyees are cl earl y al igned
t o t hem. In t his scenario, t he need
f or r i gi d pol i ci es and pr ocedur es
di mi ni shes as peopl e i ngr ai n t he
or gani zat i onal pr i or i t i es i n t hei r
mi ndset and t he act i ons t aken by
t hem aut omat i cal l y ar e di r ect ed
t owards l arger organizat ional goal s.
Employees need to be Thi s obvi at es t he need f or a r i gi d
viewed as the assets of st ruct ure and policy f ramework which
the organizations t hen onl y need t o be direct ional and
which need to be gives enough f lexibilit y t o t he middle
nurtured and not as and l ower management t o t ake
assets which are to be decision and show leadership init iat ives
‘managed’. The wi t h t he over al l or gani zat i onal
primary focus has to f r amewor k.
be Human Resource As regards HR syst ems are concerned,
Development and not t he maj or ar ea whi ch need t o be
Human Resource addressed, part icularly by old economy
Management. compani es, i s t he change i n t he
mi ndset of t he HR t eam whi ch i n
many cases st il l carries t he l egacy
of t he ol d i ndust r i al r el at i ons
management er a. Empl oyees need
t o be vi ewed as t he asset s of t he
or gani zat i ons whi ch need t o be
74
nurt ured and not as asset s which are
t o be ‘ managed’ . The primary f ocus
has t o be Human Resour ce
Development and not Human Resource
Management . It i s onl y af t er t hi s
t hat robust HR syst em which wil l be
abl e t o ident if y, devel op and nurt ure
l eader can be devel oped. The
mechani sm can be var i ed and can
i ncl ude t hi ngs l i ke l eader shi p
assessment cent ers, obj ect ive appraisal
syst ems, organizat ional ‘ champions’
who espouse t he cause of buddi ng
l eaders, breaking t he organizat ional
t asks int o t eam based proj ect s which
provides new peopl e an opport unit y
t o show leadership init iat ives and t hus
hel ps ident if y t he f ut ure l eaders.
Above al l is t he commit ment of t he
senior management which sees t hese
l eaders as change agent s who wi l l
def ine t he f ut ure of t he organizat ion
and not over ent husiast ic bunch of
people wit h misdirect ed energies and
t hose who deviat e f rom t he laid down
pol icies many of which need t o be
redef ined but t he organizat ion has
f ail ed in assessing t he need f or it .
It is onl y t hen, t hat a cul t ure which
f ost ers l eadership wil l devel op and
we must remember, t his is an evolving
process which does not have any short
cut s and t akes it s own sweet t ime
t o devel op.
 LEADING FOR FUTURE - PEOPLE MANAGEMENT : SARMA

Leading for Future : People Management Readers'

Forum

P. V. S. Sarma*

ABSTRACT
It i s not j ust f or mul at i on of vi si on t hat i s i mpor t ant but i t s i mpl ement at i on t hr ough
pr oper pl anni ng t hat f or ms t he mai n cr ux wher e t he peopl e management phi l osophy
comes i nt o pl ay. It i s done by managi ng peopl e pot ent i al t hr ough shar i ng of knowl edge
and resources and making t hem equal part ners in organisat ions’ st rif e f or excel l ence. In
t he cur r ent scenar i o of mer ger s, acqui si t i ons et c. Leader s hel p i n managi ng change
and br i ng about change by cr eat i ng comepet i t i ve edge f or t he company by r ecr ui t i ng Successful leaders
t he best employees, ret aining t hem and empowering t hem t hrough t raining and enhanced either create the
gr owt h oppor t uni t i es. Wor k f or ce di ver si t y i s t he new t r end and i t shoul d be managed future of their
ef f ect i vel y by cr eat i ng f ami l y f r i endl y wor k envi r onment and amal gamat i ng di ver se organizations or
cult ures int o t he corporat e cult ure t hrough diversified t raining. This will lead t o underst anding visualize the most
l ocal cul t ur e and cr eat e mul t i -cul t ur al wor k envi r onment . likely future and
KEYWORDS : Wor k For ce Di ver si t y, Peopl e Management prepare for it.

“ I can’t change t he di r ect i on of t he Gandhi f ormer Prime Minist er of India

wi nd. But I can adj ust my Sai l s” sel ect ed Mr. Sat ish Dhavan, t he t hen
Di r ect or of t he Indi an Inst i t ut e of
— Anonymous
Science, Bangalore t o head t he Space
Int roduct ion Program f or our count ry, Mr Dhavan
Successf ul l eaders eit her creat e t he sent a l et t er of six pages det ail ing
f ut ur e of t hei r or gani zat i ons or his ideas and f ut ure plan f or t he space
visual ize t he most l ikel y f ut ure and program and want ed t he Government
pr epar e f or i t . When Mr s. Indi r a t o accept his ideas bef ore he t ook
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

* Ex-Addit ional Direct or (HRD), MTI, SAIL, Ranchi

75
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Readers' up t he responsibil it y (1) Mrs. Gandhi
Forum accept ed t he pl an and Mr Dhavan l ed
t he Indian Space Program t o success.
Mr Dhavan t hus creat ed t he f ut ure
f or t he Space Program of India and
ensured impl ement at ion as per his
pl an. He al so ensured an ef f ect ive
succession plan by developing leaders
like our honorable President , Dr Kalam.
Dhirubai Ambani visual ized t he l ikel y
f ut ure of t he t ext il e and oil Indust ry
i n t he gl obal arena and creat ed a
gr eat company cal l ed Rel i ance
Indust ries Lt d. His sons while cont inuing
t o implement t he vision of t heir fat her
visual ized t he opport unit ies in t he
Communicat ions Indust ry and we see
Extraordinary leaders Rel iance Communicat ions as one of
dare to rock the boat t he t op communi cat i ons company
to create highly t oday.
innovatative products
Whet her t he l eader cr eat es hi s
and services or
organizat ion’s f ut ure or visualizes t he
achieve significant l ikel y f ut ure, he f ormul at es a vision
growth and market f or hi s company. For successf ul
leadership. Ordinary implement at ion of his vision, t he most
leaders choose to essent i al r equi r ement i s ef f ect i ve
protect the status quo. management of t he most import ant
resource – t he Peopl e.
An at t empt has been made i n t hi s
art i cl e t o bri ng out some i deas i n
t he peopl e management ar ea t o
succesf ul l y l ead f or t he f ut ure.
Leadership & Current Scenario
Leadership is about creat ing a vision,
inspiring your peopl e t o t ake on t hat
vision and providing t he knowl edge,
resources and inspirat ion t o achieve
t hat vi si on t hr ough t he ef f or t s of
your t eam. Peopl e wi t hi n an
organizat ion general l y want t o f eel
t hat t hey are an int egral part of t he
76
or gani zat i on. They want to
cont inuousl y l earn new ideas, new
ski l l s, new t echnol ogi es and new
approaches t o probl ems. They want
t o be “ Led” by someone who inspires
t hem, mot ivat es t hem, hol ds t hem
account abl e, and prepares t hem f or
t he f ut ure.
In f ut ure progress of organizat ions
wil l depend on t he pot ent ial of t heir
peopl e. Leaders have t o unl ock t he
hidden pot ent ial. They cannot af f ord
t o set goal s and expect peopl e t o
march on t o f ul f il l t hem. They have
t o accept t hem as part ners i n t he
business. They have t o underst and
t heir needs, f eel ings and ambit ions
and accordingl y deal wit h t hem wit h
appropriat e st rat egies t o mot ivat e,
devel op and support t hem t o real ize
t heir pot ent ial t hemsel ves.
Invent ing t he f ut ure requires one t o
rock t he boat . Ext raordinary l eaders
dare t o rock t he boat t o creat e highly
i nnovat at i ve product s and servi ces
or achi eve si gni f i cant gr owt h and
market l eadership. Ordinary l eaders
choose t o pr ot ect t he st at us quo.
Acquisit ion of Arcel or by L N Mit t al ,
Acquisit ion of Corus St eel by Rat an
Tat a, Diversificat ion int o Ret ail Indust ry
by Mukesh Ambani and l arge scal e
expansi on of Bi g Bazar by Ki shor e
Biyani of Fut ure Group, Acquisit ion
of Sesa –Goa by Anil Agarwal of Vedant a
ar e a f ew r ecent exampl es of
ext raordinary l eadership.
“ Rocking t he boat ” creat es signif icant
changes i n or gani zat i ons. It has
powerf ul impact on peopl e. Change
creat es t ension bet ween t he past and
t he f ut ure, bet ween st abilit y and t he
 LEADING FOR FUTURE - PEOPLE MANAGEMENT : SARMA
unknown. In spi t e of busi ness
rat i onal e, pl anni ng, and st rat egi es
associ at ed t o manage change, t he
t ension comes down t o peopl e doing
di f f erent t hi ngs i n di f f erent ways.
Asking people t o change t heir behavior
t o achi eve or gani zat i onal vi si on
creat es emot ional react ion. Here is
t he need t o demonst rat e t he right
l eadership skil l s t o ensure ef f ect ive
peopl e management t o real ize t he
desired f ut ure.
Globaliz at ion & t he r ising of
Indian Mult inat ionals
Unt il recent l y gl obal mul t inat ional s
had been st art i ng t hei r operat i ons
in India. But , now many Indian business
houses have st ar t ed acqui r i ng
companies abroad. The val ue of such
acquisit ions in t he f irst 10 mont hs
of 2006 was est i mat ed t o be $23
billion (2) and Indian companies large,
mi d-si ze and smal l compani es ar e
set t o become much more gl obal in
t he coming years. Leaders of t hese
progressive organizat ions have t o open
t heir windows t o t he winds of new
i deas and mul t i -r aci al wor kf or ce.
Coping wit h t he challenges of managing
diversif ied workf orce will be dif f icult .
Or gani zat i ons must cr eat e an
environment where peopl e devel op
int ernally as well as on t he j ob. Abilit y
t o change ment al model s, syst ems
t hi nki ng and personal mast ery are
such i nner i mpr ovement s. These
improvement s lead t o bet t er personal
rel at ionships at individual l evel and
ensure growt h at organizat ional level.
In addi t i on t o t hi s, due t o ever
i ncr easi ng compet i t i on bet ween
business houses, war f or t al ent wil l
f ur t her i nt ensi f y. Ther e wi l l be Readers'
increased compet it ion f or recruit ing Forum
and ret aining people wit h t he requisit e
compet enci es f or a mul t i nat i onal
organizat ion. Gl obal companies wil l
f ace many a socio-cul t ural probl ems
in t heir j ourney t owards success and
success wi l l come t o onl y such
or gani zat i ons t hat have t op cl ass
l eadership.
Leading f or Fut ur e: Ar eas f or
Concent rat ion
In order t o remain rel evant and l ead
in t his unf ol ding scenario, Mergers
& Acqui si t i ons, Joi nt Vent ur es,
Diversif icat ion of Business and l arge
scal e expansion of capacit ies are t he
phenomena of t he day. These ar e
t he out comes of decisions by l eaders
Organizations must
t o cr eat e a new f ut ur e f or t hei r
create an
or gani zat i ons.
environment where
The f ol l owing wil l be t he areas t o people develop
be concent r at ed upon i n t he internally as well as
management of peopl e t o hel p on the job.
management s i n l eadi ng t hei r
or gani zat i ons i nt o t he f ut ur e wi t h
success:
1. At t r act ing, gr owing and
retaining great talent is critical for
achieving and sustaining competitive
advant age.
Organizat ions have t o innovat e new
met hods of recruit ment t o get t he
best peopl e i n t he i ndust r y t o f i t
int o t he exist ing cult ure and mot ivat e
t hem properl y.
Gl obal net working maj or, CISCO, had
t o meet i nt ense compet i t i on i n
recruit ment in t he IT indust ry in 1995
( 3) . It s management deci ded t o
i nt r oduce i nnovat i ve r ecr ui t ment
77
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Readers' met hods t o get t he best peopl e and
Forum r emai n t he l eader i n t he Int er net
era. Foremost among t hese was t he
f irst of it s kind onl ine recruit ment
cal l ed t he “ Fri ends Program” . The
company recruit ed about 40-50% of
i t s empl oyees t hr ough “ Make a
f r i end@Ci sco” onl i ne pr ogr am and
ot her init iat ives l ike “ Buil d – t he –
buzz” st rat egy, Focus groups t o t arget
passi ve j ob seeker s and t he t op
10- 15% peopl e i n t he net wor ki ng
indust ry, encouraging int ernal referrals
f or recruit ment t hrough a program
cal l ed “ Amazing Peopl e” , et c.
To el iminat e t he probl ems f aced by
t he new recruit s, Cisco launched Fast
St art Employee-orient at ion init iat ives
l i ke pr ovi di ng a f ul l y f unct i onal
Leaders have to
workspace on t he first day, orient at ion
provide opportunities
t owards “ l if e inside t he company” ,
continuously to their
“ Cisco Business Essent ial s” , et c.
people to update
2. Making the Good people great
knowledge and
acquire new skills. To quot e t he words of Vice–Chairman
& CEO of Dr Reddy’ s Labor at or i es
in his art icle in t he OUTLOOK Business
dat ed 5t h May 2007, “ It was t he
abil it y of t he f ounder t o ‘ l et go of
t he rei ns’ and empower peopl e i n
whom he saw t he spark t o del iver,
t hat resul t ed in Dr Reddy’ s becoming
what it is t oday” . Dr Reddy’s nurt ured
a cul t ure of not punishing peopl e f or
t heir bona fide mist akes. Management s
have t o f undament al l y t r ust t hei r
peopl e t o give t hem space t o dream
and enable t hem realize t heir dreams.
Leaders have t o provide opport unit ies
cont inuously t o t heir people t o updat e
knowl edge and acqui re new ski l l s.
They have t o t ake t he responsibil it y
f or t he l earning of t heir peopl e and
78
t hei r or gani zat i on. Once t he
or gani zat i on becomes a l ear ni ng
organizat ion, it cont inuously expands
it s capacit y t o creat e it s f ut ure.
3. Ret aining t he t alent
Wit h t he ever increasing opport unit ies
for compet ent people and t he int ensit y
of war f or t al ent , at t rit ion l evel s in
or gani zat i ons ar e al l t i me hi gh.
Organizat ions have t o t ry newer and
newer approaches t o ret ain t al ent .
Organizat ions which can develop int o
“ Great Pl aces t o Work” wil l be abl e
reduce at t rit ion and ret ain t al ent .
Inf osys, Googl e Corporat ion, Federal
Express, NTPC, MindTree Consul t ing,
et c are some of t he 25 compani es
t o have been ident ified as great places
t o work in 2006 by t he st udy conduct ed
by Grow Tal ent in part nership wit h
t he Great Pl aces t o Work® Inst it ut e
of t he USA and Busi ness Worl d. In
t hese great places t o work, employees
t rust t he peopl e t hey work f or, t ake
pride in t he work t hey do and enj oy
t he company of t heir col l eagues.
Al l t hese compani es i ni t i at ed and
impl ement ed met hods t o keep t heir
peopl e happy at work and at home
and t o get t he best out of t hem. As
per f i ndi ngs i n t he st udy (4), t he
f ol l owi ng ar e t he basi cs t o whi ch
companies t hat are ident ified as Great
Pl aces t o Work st ick:
* Hiring thro’ referrals:
Happy employees will only ref er t hose
who f it t he company needs.
* Being a center for learning
Providing ext ensive t raining including
using int ernal special ist s.
 LEADING FOR FUTURE - PEOPLE MANAGEMENT : SARMA
* Of f er ing cr oss- f unct ional
gr owt h oppor t unit ies
Growt h is no l onger in a depart ment
silo. Employees can be given t he opt ion
t o choose t heir growt h pat h.
* Always completing the feedback
loop
Great workplaces correct t he wrongs.
Top and seni or management must
have regular communicat ion wit h t heir
empl oyees and obt ai n f eedback t o
t ake cor r ect i ve act i ons when
necessary.
* Not leaving flanks open to talent
out age
They make concret e succession plans
and minimize empl oyee Turnover.
* Building empowerment into systems
No amount of t r ai ni ng can ensur e
t his. Proper del egat ion of aut horit y
and f reedom t o t ake risk must be
provided t o encourage creat ivit y and
i nnovat i on.
* Ensuring fun, impromptu parties,
f amily out ings, et c f or St af f er s
creat e profit able companies
Employees must enj oy t heir work and
have opport uni t i es t o get rel i eved
of st r ess & f at i gue. Cr eat i on of a
family cult ure in t he company enhances
commit ment t o t he organizat ion and
al so t eam spirit .
4. Managing Diversit y
Consequent t o increased globalizat ion,
organizat ions f ace t he chal l enge of
bl endi ng di f f er ent cul t ur es and
managi ng peopl e f r om di f f er ent
backgr ounds, r el i gi ons, l anguages,
cust oms and social norms. Managers
who go t o a f oreign count ry t o put Readers'
an organizat ional syst em in place have Forum
t o change t hei r l eader shi p st yl es,
communi cat i on met hods and ot her
pract ices t o suit t o t he l ocal cul t ure.
Fi r ms whi ch adopt a pr oact i ve
appr oach t o r ecr ui t peopl e f r om
diverse backgrounds general l y have
a t al ent ed and capabl e workf orce.
Diverse workf orce provides diverse
view point s f or t aking decisions and
diverse view point s lead t o innovat ive
solut ions f or problems and innovat ive
met hods of wor k.
For effect ive management of diversit y,
organizat ions have t o creat e Famil y-
Fr i endl y Wor k Envi r onment as per
t he l ocal needs t o enabl e empl oyees
t o bal ance t heir work and personal
lif e. This would lead t o improvement Creation of a family
of employee morale, product ivit y and culture in the
bel ongi ngness t o t he organi zat i on. company enhances
Pr ogr essi ve compani es i mpl ement commitment to the
f amily f riendly programs like f lexible organization and also
work hours, compressed work weeks, team spirit.
on sit e chil d care, t el ecommut ing,
parent al leave and relocat ion assist ance
f or t he f ami l y member s of t he
empl oyees.
Training can pl ay a very import ant
rol e in managing diversit y. Managers
and ot her empl oyees who work wit h
diverse employees are t o be provided
Diversit y Training t o underst and ot her
cul t ures, pract ices and cust oms and
al so t o give t hem an insight int o t he
import ant issues of managing diversit y.
Fut ure organi zat i ons must become
mul t i cul t ur al or gani zat i ons whi ch
acknowl edge cont ribut ions made by
various cult ural and social groups and
highlight t heir int erest s in it s mission,
79
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Readers' operat ions and product s or services.
Forum They must also discourage t he pract ice
of any form of social oppression wit hin
it and incl ude members of diverse
social and cult ural groups in t he decision
maki ng pr ocess.
Conclusion
Ext raordinary l eaders visual ize t he
f ut ure of t hei r compani es; i nvol ve
key employees in developing st rat egies
f or r eal i zi ng t he desi r ed f ut ur e,
communicat e t he st rat egies and plans
t o all t he employees, provide resources
and happy work environment . They
st rive t o get t he best peopl e in t he
indust ry, empower t hem, and ret ain
t hem by providing excel l ent rewards
& growt h opport unit ies. They manage
t heir people ef f ect ively and lead t heir
t eams and organizat ions t o a great
f ut ur e.
“ St art wit h good peopl e, l ay out t he
r ul es, communi cat e wi t h your
employees, mot ivat e t hem and reward
t hem. If you do al l t hose t hi ngs
ef f ect ivel y, you can’ t miss. ”
— Lee Iacocca

Extraordinary leaders
visualize the future
of their companies;
involve key employees
in developing
strategies for
realizing the desired
future, communicate
the strategies and References:
plans to all the ( 1) The Week ( 22 Apr i l 2007): ( 3) www. f ast company. com: “ Hi r e
employees, provide Indira Gandhi’ s space odyssey Great peopl e Fast ” by Birchard
resources and happy Bill
( 2) OUTLOOK Business ( 5 MAY 2007)
work environment.
: “ New Front iers, New Thinking” ( 4) Businessworl d (23 April 2007):
by Kumar Mangal am Birl a “ That Monday Feeling” by Pallavi
Roy

80
 MERGER & ACQUISITIONS - AN ESSENTIAL SKILL FOR FUTURE LEADER : PANDA

Mergers & Acquisitions : An Essential Skill Readers'

for Future Leader Forum

S. K. Panda*

Abst ract
Gr owt h symbol i ses Expansi on, Mer ger, Take over, Joi nt Vent ur e et c. The economi c
f oundat ion of any count ry l ies on a compet it ive product ion base. The reasons f or mergers
and t akeovers can be t o increase market power, growt h rat e and make good invest ment s
t o bal ance compl et el y or di ver si f y pr oduct l i ne, t o r educe compet i t i on et c.
Government
Keywords: Gr owt h, Int egr at i on, Re-est abl i shment
initiative in opening
up of Indian Market
in the 1990s has led
to increased
competition and
paved ways for
numerous M&As.
The economi c f oundat i on of any t he scheme of amal gamat ion which
count r y event ual l y r est s on a should be approved by t he “ specif ied
compet it ive product ion base. And if aut horit ies” under sect ion –72 of IT
a cor por at e adopt s a st r at egy f or Act .
growt h t he same l ies in expansion.
In t he US, amal gamat ion t ook pl ace
Growt h is t o expand,Merger.Take over,
subst ant ial l y during t he period 1898-
Joint vent ure et c.
1902, 1926-1930 and 1946 – 1956.
As per t he st at ut e of t he land relat ed Agai n t her e was boom of
t o Indian Companies –Amal gamat ion amalgamat ion in 1960, 1980, 1990. The
t akes place eit her by t he int erf erence amal gamat ions t ook pl ace inside t he
of cour t i n publ i c i nt er est f or count ry it sel f and t hen it went on
rehabilit at ion, re-est ablishment et c. globally.
Or, by Cent r al Gover nment ’ s Government init iat ive in opening up
int erf erence in publ ic int erest under of Indi an Mar ket i n t he 1990s has
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

* Sr. Manager (ICLC), RSP, SAIL, Rourkela

81
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Readers' led t o increased compet it ion and paved
Forum ways f or numerous M&As.
M&A act ivit ies are not new in India.
If we browse t hrough t he l eaves of
hi st or y r el at ed t o Mer ger and
acquisit ion act ivit ies we can see t hat
t hi s i s not a new t hi ng f or Indi a.
Imperial Bank Act of 1920 which was
f or med by amal gamat i on of t hr ee
Presidency banks were i. e. The Bank
of Bengal (f ounded i n 1806), Bank
of Bombay (f ounded in 1840), , Bank
Of Madras (Founded in 1843) Lat er
t he Imperial Bank was f ormed int o
Reserve Bank Of India in 1935.
Similarly 11 cement companies merged
t o f orm Associat ed Cement Company
For M&A to take in t he year 1937, Indian Iron and St eel
place two companies company absorbed St eel Corporat e
are required to act at of Bengal in t he year 1967 t o name
a time so that one a f ew as an exampl e.
becomes Buyer and Now f r om 2000 t o 2007 t her e ar e
the other becomes a numerous exampl es and every ot her
seller with both of day we come t hrough some of t hese
them having their act ivit ies.
own reasons to do so.
One exampl e f rom t he St eel Indust ry
is wort h cit ing here. That is Mit t al
St eel acquired Arcel or company in a
t akeover bi d and became number
one st eel pr oducer i n t he wor l d
, wher eas Tat a St eel whi ch was
consi der ed t he number t wo st eel
producer in India, became t he number
f i f t h i nt ernat i onal st eel producer
by virt ue of acquisit ion of Corus St eel.
As such t here are numerous examples
of M&A act i vi t i es such as t hat of
Tat a Tea, Ranbaxy, Tat a Cof f ee,
Reliance Indust ries, ONGC, Dr. Reddy’s
Lab, Wockhar dt , Appol l o Tyr e and
t he name can go on and on…
82
Reasons for Merger & Takeovers
For M&A t o t ake place t wo companies
are required t o act at a t ime so t hat
one becomes Buyer and t he ot her
becomes a sel l er wit h bot h of t hem
having t heir own reasons t o do so.
Let us see why buyer company wishes
t o mer ge : -
- To i ncr ease mar ket power,
gr owt h r at e and make good
i nvest ment s.
- To i mpr ove t he st abi l i t y of
earning and sal es.
- To balance complet e or diversif y
product l ine
- To reduce compet it ion
- To acqui r e needed r esour ces
quickly
- To avai l t ax concessi on and
benef i t s
- Overcome ent ry barriers t o new
mar ket s or r egi ons
- Avoi d cost of devel opi ng new
product s int ernally and bringing
t hem t o mar ket
- Increase val ue of organizat ions
st ocks
- To increase t he speed of new
mar ket ent r i es.
- Reduce t he risk of ent ering new
busi ness.
- Become more diversif ied
- Reshape compet i t i ve scope
t hrough devel oping a dif f erent
port f ol io of business.
- To t ake advant age of synergy.
- To enumerat e a f ew point s as
 MERGER & ACQUISITIONS - AN ESSENTIAL SKILL FOR FUTURE LEADER : PANDA
t o why t he seller want s a merger.
- To increase t he value of owner’s
st ock and i nvest ment s.
- To increase t he growt h rat e
- To acquire resources t o st abilize
oper at i on.
- To benef it f rom t ax l egisl at ion.
- To deal wit h t op management 's
succession probl ems.
Mer ger and Takeover i s l i ke a
marri age bet ween t wo i ndi vi dual s.
A proper marri age requi res proper
under st andi ng, co- oper at i on , co-
ordi nat i on, t rust bet ween t he t wo
i ndi vi dual s t o r esul t i n a l ast i ng
rel at ionship which is t rue in case of
cor por at e.
Today more and more corporat e are
st riving f or market share in t he global
f ield. It is said t hat if t omorrow t here
will be any t hird world war , t hat shall
t ake pl ace bet ween corporat e giant s
not bet ween count ries. That t oo not
f or grabbing land of t he neighborhood
count ry but t o grab a big chunk of
mar ket shar e.
Some t imes dif f icul t ies arise in t he
M&A syst em due t o various reasons
and f ew are cit ed bel ow.
- Inef f ect ive int egrat ion bet ween
t he merged compani es.
- Incor r ect eval uat i on of t he
acquired f irm in t erm of val ue,
cr eat i on of debt l oad t hat
precl ude adequat e invest ment
required f or l ong t erm success.
- Overst at ement of pot ent ial f or
syner gy.
- Creat ion of f irm t oo diversif ied, Readers'
given it ’s core compet encies and Forum
environment al opport unit ies.
- Creat ion of int ernal environment
in which managers devot e t heir
t i me anal yzi ng and
compl ement i ng addi t i onal
acquisit ions
- Devel opment of combine f irm
rat her t han st rat egic cont rol s
Let ’ s t ake a l ook at a t heor et i cal
t reat ment at t he basi s of M&A: -
Appraisal of int ernal environment of
an organizat ion wil l be appropriat e
t o give an underst anding as t o how
synergist ic ef f ect can be creat ed by Today more and more
t he combinat ion of t he resources of corporate are striving
t wo or gani zat i on t o l ead t o for market share in
organizat ional capabilit ies and t hereby the global field. It is
st rat egi c advant ages. said that if tomorrow
Any or gani zat i on consi st of t wo there will be any
component s which are organisat ional third world war ,that
resources and organizat ional behaviour. shall take place
Organisat ional resources consist s of between corporate
asset s, capabi l i t i es, organi sat i onal giants not between
pr ocesses, i nf or mat i on knowl edge countries.
physical , human and Organisat ional
resources et c. similarly organisat ional
behavi or s consi st s of qual i t y of
l eadership, management phil osophy,
sharedvalues, cult ure, qualit y of work
environment , organisat ional cl imat e
organisat ional polit ics and use of power
et c
Or gani sat i onal r esour ces and
organizat ional behavior does not exist
in isolat ion. They combine in complex
ways t o creat e st rengt h and weakness
wit hin an organizat ion. St rengt h is
an i nher ent capabi l i t i es whi ch an
or gani zat i on can secur e t o gai n
83
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Readers' st r at egi c advant age. Si mi l ar l y
Forum weakness i s an i nherent l i mi t at i on
or const raint s which creat e st rat egic
di sadvant age f or an or gani zat i on.
St rengt h and weaknesses do not exist
i n i sol at i on but combi ne wi t hi n a
f unct i onal ar ea, and al so di f f er ent
f unct ional areas t o creat e synergist ic
ef f ect . Such synergist ic ef f ect l eads
t o compet ency and st r at egi c
advant age t o a f irm.
In merger and acquisit ion processes
firms st rive t o creat e synergist ic effect
by t he combinat ion of organisat ional
resources and organisat ional behaviors
of t wo or more organi zat i ons.
Benefit s out of M&A
In merger and
acquisition processes M&A is being resort ed t o as a mode
firms strive to create of invest ment by t he corporat e ent it ies
synergistic effect by t o consol idat e t heir operat ions and
the combination of t o be compet it ive in gl obal market .
organisational The process enabl es an organizat ion
t o be compet i t i ve by empl oyi ng
resources and
int ernat ional product ion net work more
organisational
ef f icient ly and t o achieve operat ional
behaviors of two or
and f inancial synergy. Merger and
more organizations.
acquisit ion al so l eads t o ef f iciency
gai n when t wo f i r ms have
compl iment ary l ow cost product ion
process. Merger also leads t o efficiency.
Impr ovement i n per f or mance i s
achi eved ei t her t hr ough a l ower
expendit ure of real resources f or t he
same out put or by increasing out put
wi t h t he same resources.
New f orm of oligopolist ic compet it ion
based on knowl edge net wor ks can
be reached by st rat egic part nering
t hrough M&As. Operat ional f l exibil it y
of f irms t o meet new demands are
increased by st rat egic mergers and
acquisit ion act ivit y t hat are const ant ly
84
gener at ed under t he cont i nuous
process of innovat ion. The sect orial
inst ances of merger and acquisit ion
present t he pressure f or consolidat ing
and r at i onal i zi ng asset s. The
t el ecommuni cat i on and banki ng
i ndust r i es, havi ng gone t hr ough a
series of deregul at ory measures, are
coping wit h a complex mix of great er
compet i t i on t hat ar ose f r om
t echnol ogical change and t he need
t o suppl y a worl d wide market . The
oil and chemical indust ries t oo are
facing similar challenge of t echnological
i nnnovat i on. Fi r ms in t he
pharmaceut ical indust ries, a maj or
t arget of merger and acquisit ion in
indust rial ized count ries rel y heavil y
on R& D, whi ch makes st r at egi c
mer ger s advant ageous. As t hese
exampl es shows, gl obal i zat i on
int ensif ies compet it ion, which f orces
f irms t o rat ionalize int ernal resources
an increase access t o wider market
as well as achieve economies of scales
t hrough M&As .One of t he logic behind
merger of t wo Brit ish companies i. e.
Br i t i sh pet r ol eum and Mobi l down
st r eam oper at i on acr oss Eur ope i s
t o acqui r e si ze and mar ket power
t o compet e against ot her maj or oil
companies and achieve cost savings
by eliminat ing duplicat e f acilit ies and
empl oyees, rat ional izing purchasing
and cut t i ng t he cost . Inst ance of
mer ger bet ween t wo
t elecommunicat ion maj ors has creat ed
oppor t uni t i es f or val ue cr eat i on
t hr ough common sof t war e
devel opment , shar ed capi t al
i nvest ment and j oi nt pur chasi ng
agreement . Combining compliment ary
asset s t hrough such process also help
 MERGER & ACQUISITIONS - AN ESSENTIAL SKILL FOR FUTURE LEADER : PANDA

to achi eve compl i ment ar y af t er comparison of cash f lows ret urn Readers'
compet enci es i n t echnol ogi es and of acqui r ed f i r m concl ude t hat Forum
expert ise and great opport unit ies t o acquisit ion bring higher weal t h gains
cr eat e val ue in t he r i ght f or insol vent f irms t han t hose under
circumst ances. Some st udies reveal independent workout , and t hose gains
t hat acquisit ion can be especially useful are higher in cross border t ransact ion
in rest ruct uring t hose f irms, which t han domest i c mer ger s and
are not perf orming wel l . Bef ore and acquisit ions.

... acquisition can be

especially useful in
restructuring those
firms, which are not
performing well.

85
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Case Case on Leading for Turnaround and Future
Study
Path of Growth
Dr. Hari Haran*
Maint aining sust ainabl e growt h of a
busi ness ent er pr i se i s a mat t er of
st rat egic and operat ional concern of
business leaders. A business f irm get s
si ck when i t f aces a consi st ent
downt rend in it s operat ing prof it s.
... proactive action Int ernal and ext ernal act ions need
towards prevention of t o be init iat ed t o improve upon it s
sickness also holds key financial healt h and prevent insolvency.
to sustainable success The t urnaround management involves
and growth of an manager i al act i ons t o over come
enterprise. perf ormance bl ues af t er t he onset
of sickness of an indust ry. But proact ive
act ion t owards prevent ion of sickness
al so hol ds key t o sust ainabl e success
and growt h of an ent erpri se.
Bharat Bearing Company Lt d. , (BBCL)
was a ball bearing manuf act uring unit
hel d by BRF Lt d. which was a Bharat
group company. It was incorporat ed
i n 1962 wi t h an i nst al l ed capaci t y
of 2. 0 million ball bearings per annum
wit h t he mission t o f ulf ill t he bearings
r equi r ement of consumer dur abl e
indust ry. It had t echnically collaborat ed
wit h t he t hen gl obal l eader, Rockf er
Bearing Company, USA which provided
t he t echnol ogy of bearing design and
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○
* DGM (Acad.) & Sr. FM, MTI, SAIL, Ranchi
86
manuf act ur i ng. It was sel l i ng i t s
product s t o a wide market segment
under lesser compet it ive market . The
company was making prof it t il l 1980
- 81. Ther eaf t er, i t s per f or mance
st art ed decl ining and it was ref erred
t o Bureau of Indust rial and Financial
Reconst r uct i on ( BIFR) i n 1991. It
successf ul l y i mpl ement ed t he
rehabilit at ion scheme and got revived
in 1995, making record earnings and
prof it in t he year.
It developed it s product market niche
in t he Fan segment and reached a
capacit y l evel of 8 mil l ion bearings
per annum. In 1994 under it s “ Long
Range Plan” it t ook st rat egic init iat ive
t o reduce dependence on Fan indust ry
which was seasonal and f urt her t o
develop market niche in t wo wheeler
aut omobi l e and el ect r i c mot or
segment s. In view of market get t ing
more compet it ive it set out t o achieve
economy of scal e by increasing pl ant
capacit y f rom 8 mil l ion t o 18 mil l ion
bearings per annum in a phased manner
over t he next t hr ee year s and
compl et ed it s expansion in 1998.
○ ○ ○ ○ ○ ○ ○ ○
 CASE ON LEADING FOR TURNAROUND AND FUTURE PATH OF GROWTH : HARAN
The company had it s mission since
i t s i ncept i on i n 1962 t o f ul f i l l t he
bear i ngs r equi r ement of consumer
dur abl e i ndust r y. It had t echni cal
col l aborat i on wi t h t he t hen gl obal
l eader of t he t rade, Rockf er Bearing
Co., USA. It had broad banded product
mi x st r at egy consi der i ng t he wi de
market opport unit ies of t he product
and facing less compet it ion t hen. Lat er
when i t came under BIFR i n 1989,
under t he rehabilit at ion package low
cost invest ment s were made t owards
moder ni zat i on and l i ne bal anci ng
equipment s. Addit ion of st at e of art
machi ner i es ( CNC machi nes) and
qual it y inspect ion equipment s f rom
world famous manufact urers increased
t he pl ant capacit y up t o 8 mil l ions
per annum. As a st rat egic move, it
gradual l y devel oped market niche in
Fan segment of t he OEM market f acing
st if f compet it ion in aut omobil e and
elect ric mot or segment s; which were
dominat ed by t he mul t inat ional s l ike
BRF, FAH and Indi an maj or LMC.
When gover nment announced t he
policy of economic liberalizat ion and
globalizat ion in 1991, t he Indian bearing
manuf act urers st art ed f acing market
whi ch was f l ooded wi t h cheaper
import ed bearings. It became suddenly
dif f icul t f or BBCL t o mat ch in price
and qual it y bot h. It suf f ered severe
market slump. Wit h increased financial
burden due t o t he recent expansion
proj ect and i n t he f ace of eroded
mar ket i t pl unged i nt o a sever e
f i nanci al cri si s suf f eri ng wi t h cash
crunch. BBCL st art ed incurring heavy
l osses.
The t hinking st art ed in t he company
t o overcome perf ormance bl ues and Case
t urnaround. It was f elt t hat operat ing Study
t urnaround can be applied only when
t here were st rong st rat egic st rengt hs
(product market rel at ionship) in t he
business. The operat ing t urnaround
st rat egies might be f ocused on short -
t er m pr of i t ef f ect .
Several init iat ives were t aken by t he
company t o t urnaround. The st eps
t aken in t his direct ion had provided
some more breat hing t ime, but t he
cri si s remai ned and posed a great
chal l enge bef or e t he management
f or t urnaround. This was a daunt ing
t ask cut out f or t he management ;
whi ch r equi r ed si mul t aneous
improvement in al l f unct ional areas
It was felt that
coupl ed wit h an at t it udinal change
operating turnaround
at every l evel in t he organizat ion.
can be applied only
St at us and Business Environment
when there were
of t he Indust ry
strong strategic
The bearing indust ry st art ed in India strengths (product
wi t h t he set t i ng up of a bear i ng- market relationship)
manuf act uring unit in Raj ast han by in the business.
l eading business group of count ry in
t he year 1955. Since t hen, it grew
int o an indust ry wit h a t urnover of
ar ound Rs. 25 bi l l i on and whi ch
empl oyed more t han 14, 000 peopl e.
The organized sect or cont ribut ed 60%
out of t he t ot al t urnover of Rs. 25
bil l ion. 12%or 3 bil l ion was f rom t he
unorganized or t he small-scale segment
and import ed bearings f ormed a large
28% of t he t ot al i ndust r y. Impor t s
or smuggl ed bear i ngs wer e mai nl y
of bal l bear i ngs and l ow vol ume
requirement s f or precision j obs and
rol l ing mil l s.
The bearing indust ry in India had been
going t hrough a crisis f or t he past
87
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Case f ew years. The maj or causes f or t his sect or as wel l as t he repl acement
Study cri si s were: market . However, it was st ill dif f icult
t o achieve double-digit growt h rat es,
The gener al economi c r ecessi on
as t he indust ry had t o compet e wit h
especi al l y i n t he aut o and t he
cheaper import s. The f ort une of t he
engi neer i ng i ndust r y, l eadi ng t o a
indust ry was cl osel y rel at ed t o how
negat ive growt h in overall product ion
well t he user indust ries of aut omobile
of bearings f or t he l ast t wo years.
and engineering perf ormed. In t he
The product ion in 1997-98 was 18%
f i r st ni ne mont hs of t he f i nanci al
lower t han f or 1996-97 and was down
year 2000-01, a r ecover y i n t hese
t o 4%in 1998-99 over 1997-98. Hence
sect ors meant t hat t he bearing indust ry
in t hese t wo years t here had been a
mi ght t ur nar ound.
net drop of cl ose t o 22%.
There was a general not ion t hat a
The ent ire bearing indust ry underwent
sick company f aced severe cash crisis
a severe crisis because of t he f act ors
or a consi st ent downt r end i n i t s
ment ioned above. The demand f or
oper at i ng pr of i t . The pr ocess of
bear i ngs f r om t he or gani zed f an
si ckness i s gr adual whi ch can be
indust ry (BBCL’ s niche segment ) had
st opped and r ever sed by t i mel y
st agnat ed, prices were crashed and
correct ive act ion. It requires t imel y
consequent ly t he bot t om lines of most
The process of cognizance of t he f act by al arming
of t he bear i ng compani es i n Indi a
sickness is gradual signals about sickness charact erist ics.
were severely af f ect ed. The f ollowing
which can be stopped One needed t o i dent i f y t he causal
Tabl e – 1 shows t hese t rends.
and reversed by f act ors which vary f rom indust ry t o
Table – 1: Profit Trend in indust ry and company t o company.
timely corrective
Bearing Companies in India But some common signal s coul d be
action.
pi cked up t o know t he onset of
Company Net Profit
sickness. Some of t he charact erist ics
1995-96 1996-97 1997-981998-99
of maj or si ckness wer e i dent i f i ed
BRF 2320 2920 590 - 4430
as given bel ow.
NAC NA 1016 546 66
FAH 695 1025 869 401 z Decr easi ng mar ket shar e.
TBL NA 23 2 - 707 z Decreasing const ant rupee sales
ABF 118 133 24 - 132 (adj ust ed f or i nf l at i on).
LMC 650 777 73 - 1003
z Decreasing prof it abil it y.
NRC 1207 1894 1176 766
HML NA 218 277 NA
z Increasing dependence on debt .
BBCL 475 263 - 1095 - 723 z Inabil it y t o payback l oans.
(15 Mont hs) Some ot her charact erist ics of moderat e
and minor sickness were as f ol l ows:
Economy st ar t ed showi ng si gn of z Rest rict ed dividend pol icies.
improvement and t hings changed in
z Fail ure t o reinvest suf f icient l y
t he year 2000 wit h a revival in demand
in t he business.
f rom t he OEM’ s i n t he aut omot i ve

88
 CASE ON LEADING FOR TURNAROUND AND FUTURE PATH OF GROWTH : HARAN
z Diversif icat ion at t he expense
of core business.
z Lack of pl anning.
z Inf l exi bl e and unquest i oni ng
management
z Management successi on
probl ems.
z Management t eam unwil l ing t o
l earn f rom it s compet it ors.
The company’ s oper at i ons st ar t ed
det eriorat ing since 1982 mainl y due
t o mismanagement , labour problems,
sect i onal i mbal ances i n t he pl ant ,
large range of product mix of bearings
et c. As a result , t he company became
a sick indust ry. The management of
Bharat Bearings Co. Lt d. (BBCL) was
changed in May 1984, f rom Laxman
Sripat t o Bhusan Chandra (al so f rom
t he Bhusan f amily) pursuant t o change
i n t he set up of Bhusan f ami l y.
However, t he company cont inued t o
incur l osses and as on 30. 09. 88, it s
accumul at ed l osses mount ed t o Rs
840 l acs against a share capit al of
Rs 60 l acs and unsecured l oans wort h
Rs 190 lacs f rom t he holding company
Bhusan Fi bres Lt d. (BRF Lt d. )
The government announced it s new
indust rial pol icy in 1990-91and t he
Indi an economy set out on cour se
of l i beral i sat i on and gl obal i zat i on.
BRF al so had t o change it s corporat e
st rat egy and obj ect ives in t he changed
business environment . Since BRF had
it s business vision of becoming a world-
class company, t he corporat e st rat egy
at BRF shift ed focus from diversificat ion
t o consol idat ion of core business t o
compet e in t he int ernat ional market .
Ther ef or e i t began t o al i gn i t s Case
resources t owards st rengt hening of Study
it s core business and divest ment of
non-core businesses. it t ook t he rout e
of hor i zont al i nt egr at i on f or
consol idat ion and acquired t he nyl on
t yre-cord manuf act uring unit of Brij
Lt d. , i n 1994, t hus becomi ng t he
undisput ed leader in India as supplier
of nyl on t yre cord. It acquired t he
synt het ic-yarn manuf act uring unit of
Ce-mont , USA in 1999 in India and
al so ent ered int o an agreement wit h
t hem, t hus becoming a worl d pl ayer
(7t h l argest in t he worl d) in it s core
business. Simult aneously, it had begun
t o divest non-core businesses one by
one over t he past f ew years. BBCL
also had t o be divest ed. Recent ly when
it acquired Ce-mont ’ s Indian pl ant ,
it divest ed BBCL. The efforts met with
initial success in the
Init iat ives were t aken simult aneously
form of ISO 9002
t o align BBCL along TQM cult ure; which
quality system
had already been adopt ed at BRF Lt d.
certification in 1994.
as a management t ool and organizat ion
cul t ure. The ef f ort s met wit h init ial
success in t he f orm of ISO 9002 qualit y
syst em cer t i f i cat i on i n 1994.
Subsequent l y, t he Japanese concept
of “ 5S” way of house keepi ng and
“ Dail y Management ” pract ices were
i nt r oduced whi ch wer e yet t o be
est ablished as a work cult ure at BBCL
envisioned obj ect ive was t o at t ain
TQM as a work cul t ure at BBCL t o
improve it s market posit ioning t hrough
est abl ishment of brand image.
BBCL had t o overcome many hurdl es
t o t urnaround. There was poor product
price real izat ion and it was unabl e
t o achieve t he inst al l ed capacit y due
t o reduced market share and cert ain
89
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Case IR probl ems. The company pl unged
Study i nt o a gr ave f i nanci al cr i si s.
Consequent l y, some downsizing was
resort ed t o t hrough VRS (Vol unt ary
Ret irement Scheme). It furt her planned
cost cut t ing st rat egy at operat ional
level and also reduct ion in unproduct ive
asset s t o make it a l eaner and cost
ef f ect i ve organi zat i on.
The heavy debt burden of t he company
due t o l oans and accumul at ed l osses
can be eased out t hrough invest ment
by t he holding company BRF Lt d. wort h
Rs 18 crores in redeemable preference
shares. Thus a f inancial rest ruct uring
was sought t o be achi eved by
conversion of inst it ut ional l oans int o
pref erence shares. BRF had done t his
t o help revive BBCL as well as divest ed
Strategy of cost it s st ake in it . The new management
cutting was also was i n t he pr ocess of f or mul at i ng
adopted on all i t s f urt her st rat egy.
operational activities Product market opport unit y or t he
to get some respite expect ed demands i n BBCL’ s mai n
from the dire state. market segment s in India are as under.
(See Tabl e 2)
St r at egy of cost cut t i ng was al so
adopt ed on al l operat ional act ivit ies
t o get some respi t e f rom t he di re
st at e. Downsizing of manpower was
al so t aken up t hr ough “ Vol unt ar y
Ret irement Scheme” (VRS). Though
t he economy was gradual l y coming
out of r ecessi on, t he pr obl ems i n
bearing indust ry in general persist ed
mai nl y due t o smuggl ed bear i ngs
making way int o Indian bearing market .
1. Sharp decline/ loss in sales volume
(t hough t he sal es quant it y was
maint ained). Gross sal es came
down t o Rs 25 Crores in 1997-
98 f rom Rs 30 Crores in 1996-
97. Downt ur n i n aver age
real i zat i on per uni t by about
Rs 10. 00 (f rom avg. Rs 36 t o
27) .
2. Signif icant l oss in cont ribut ion
t ot al ing about Rs 11 crores in
1997-98, which brought down
t he aver age cont r i but i on per
unit bearing f rom Rs 17. 00 (PV
rat io 53%) in 1996-97 t o Rs 9. 00
(PV rat i o 31%) i n 1997-98. In

Table 2 : All India Demand in BBCL's Market Segment

(Fi gures i n Lac Nos. )

Segment Demand in Expect ed Demand
1998-99 1999-2000 2000-2001 2001-2002
Fan 310 328 349 371
2-3 Wheel ers O Es 295 324 357 392
Tr act or 20 22 24 27
El ect ric Mot or & 250 262 275 290
Pumps
Repl acement Market 245 264 295 330
(2-3 Wheel er s)
Total 1100 1200 1300 1410

90
 CASE ON LEADING FOR TURNAROUND AND FUTURE PATH OF GROWTH : HARAN
t he five-year period, cont ribut ion
per uni t came down f r om Rs
20. 00 in 1993-94 t o Rs 9. 00 in
1998- 99.
3. Sharp j ump in f ixed expenses
beginning 1997 on account of
increased sal ary & wages which
had a cumul at ive ef f ect on t he
bot t om l ine of t he company.
4. Incr ease in i nt er est &
depr eci at i on on account of
capi t al i nvest ment i n pl ant
expansi on i n 1997, whi ch
account ed f or cor r espondi ng
i ncr ease i n i nt er est and
depr eci at i on as anot her
si gni f i cant reason.
5. Break Even Point (BEP) Vol ume
went up sharpl y f rom Rs 20. 00
Crores in 1996-97 t o 36.00 Crores
in 1997-98. Sal es as % of BEP
went down f rom 155% in 1996-
97 t o 48% i n 1997-98 and t o
57% i n 1998-99.
6. Company bot t om l ine became
red by t he f inancial year ended
1998 wi t h net l oss i n PBT
recorded as Rs 11. 50 Crores.
It had been inf erred f rom t he annual
account s t hat t he required val ue of
t ur nover t o br eak even shoul d be
about Rs 34 cr or es per annum
(annual ized 12 mont hs) wit h exist ing
f i nanci al est i mat es. The sal es
proj ect ion showed t hat it may achieve
t hat f i gure by end of 2000–01 and
surpass t o become prof it abl e by t he
year endi ng 2002.
Market Trend Indicat ors
Some t rends regarding quant it y, value
and price movement s segment -wise Case
f or BBCL in t he l ast t hree years were Study
st udied. It was seen t hat prices were
comi ng down and t her e was
consequent l oss of val ue real izat ion
across al l segment s. However, t here
was segment -wise variat ion in t rends.
The t ot al average price suf f ered a
l oss of over Rs 8. 50 in average unit
pr i ce i n 1998-99 agai nst 1995-96.
The maj or segment of f an, bot h
organized and unorganized suf f ered
l oss i n pri ces of Rs 6. 00 per uni t .
Int erest ingly, t he t rade (replacement )
segment suf f ered t he l east and BBCL
grew i n t hi s segment si gni f i cant l y.
A st r i ki ng t r end i n t he ni che f an
segment was t hat BBCL l ost
considerabl e market in higher val ue
organized f an segment , whereas it It was seen that
has gai ned i n t he l ower val ue prices were coming
unor gani zed f an segment . down and there was
The perf ormance of BBCL in t he l ast consequent loss of
t wo years had been unsat i sf act ory value realization
mai nl y on account of i ncr eased across all segments.
compet it ion f rom cheaper bearings
f r om ot her count r i es i n t he f an
segment in which BBCL was a dominant
player. BBCL was working on improving
t he current product -market mix f or
rapid sales cont ribut ion improvement .
Keepi ng i n mi nd t he pr esent
manuf act uring capabil it ies of BBCL,
in t he short t erm BBCL f ocused on
t he f ol l owing segment s.
z Organi zed f an segment
z Unorgani zed f an segment
z Tr ade
z Export t o count ries having large
number of t wo wheel ers.
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 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Case Quest ions :

Study 1. Ident i f y and el abor at e t he
envi r onment al f act or s whi ch
inf l uenced t he perf ormance of
Bharat Beari ng Company Lt d.
2. Di scuss t he pot ent i al s of t he
company and init iat ives t o be
t aken up by l eadership of t he
company t o i mprove upon i t s
per f or mance.
3. Comment upon t he st rat egi es
of BBCL. Suggest sui t abl e
st r at egi es f or t ur ni ng-ar ound
i t s per f or mance bl ues and
subsequent l y l eading company
on f ut ure pat h of growt h.

92
 ORGANISATIONAL DEVELOPMENT (OD) INTERVENTION IN PUBLIC UTILITY - THE CASE OF
SUNDARPUR MUNICIPAL CORPORATION : BHATTACHARYA
Organisation Development (OD) Intervention in
Public Utility : The Case of Sundarpur
Municipal Corporation
Dr. S. K. Bhat t acharya*
Prelude
This case describes an Organisat ion
Devel opment (OD) programme in a
medium size publ ic ut il it y ref erred
t o as Sundarpur Municipal Corporat ion
(SMC). The experience of SMC raised
a number of issues rel at ing t o using
OD as an approach t o change. The
pur pose of wr i t i ng t hi s case i s t o
raise some pert inent quest ions relat ing
t o OD exercise and t o ref l ect upon
t his experience and draw lessons f rom
it t hat may benef it HRD pract it ioners
who use OD as a change st rat egy.
Organisation Development (OD) at
SMC
SMC is a well-known public ut ilit y out fit
sit uat ed in t he east of India. At t he
t i me of i nt er vent i on a new
commi ssi oner, who was i n Indi an
Ar my, was appoi nt ed by t he St at e
Government t o head SMC. The new
commissioner, who appeared t o be
very dynamic and a great bel iever
in HR, along wit h his f unct ional heads,
decided t hat t here was an urgent need
t o t rain empl oyees t hroughout t he
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○
* DGM (Acad.) & Sr. FM, MTI, SAIL, Ranchi
Case
Study
cor por at i on to i ncul cat e
prof essi onal i sm i n management .
The employees were divided int o t hree
groups - seni or of f i cers, mi ddl e –
l evel of f icers and supervisory st af f .
Vari ous consul t ant s i n t he count ry
were approached t o design and impart The experience of
t raining at t hese l evel s. During t he SMC raised a
peri od, a smal l group of seasoned number of issues
consult ant s, who belonged t o a premier relating to using OD
Management Inst i t ut e wer e al so as an approach to
cont act ed t o t rain t he senior of f icers change.
of t he corporat ion. A proposal prepared
by t he consul t ant was accept ed by
t he cor por at i on. The pr oposal
suggest ed t hat a t r ai ni ng needs
assessment be conduct ed f i r st t o
det ermine t he scope and cont ent of
t raining. This was t o be f ol l owed by
a workshop f or t he commissioner and
his f unct ional head. This workshop
was t o discuss issues arising out of
t he assessment and agr ee on a
st rat egic direct ion for t he corporat ion.
This st rat egic direct ion woul d be t he
basi s f or desi gni ng and conduct i ng
a ser i es of wor kshops f or seni or
of f i cer s.
○ ○ ○ ○ ○ ○ ○ ○
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 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Case SMC empl oyed 5, 600 peopl e. There
Study were around 60 senior of f icers who
were t o be t rained by t he consult ant .
The t raining needs assessment was
conduct ed t hrough unst ruct ured and
i nf ormal i nt ervi ews wi t h a sampl e
of senior of f icers. These int erviews
revealed t hat t he senior officers largely
saw t hemselves as funct ional specialist s
r at her t han manager s of t he
corporat ion. The collaborat ive ef f ort s
f or achieving corporat ion’ s mission
was somehow missing. There was a
great deal of cyni ci sm. There was
widespread discont ent wit h t he work
environment , organizat ion cul t ure,
promot i on pol i cy et c. Many seni or
of f icers seemed t o l ack el ement ary
Very few of the senior skil l s in mot ivat ing and supervising
officers could take a t hei r st af f .
holistic view of the The or gani zat i on had a f unct i onal
organization. Status st ruct ure. Funct ions were each divided
was considered very i nt o a vari et y of depart ment s and
important and each depar t ment was f ur t her
directly tied to subdivided int o sect ions. There was
hierarchy. a gr eat deal of par ochi al i sm wi t h
r espect t o one’ s f unct i on and
depart ment . Very f ew of t he senior
of f i cers coul d t ake a hol i st i c vi ew
of t he or gani zat i on. St at us was
considered very import ant and direct ly
t ied t o hierarchy. Some f unct ions and
depart ment s were considered t o be
of higher st at us t han ot hers. In general,
t here was a great er pref erence f or
wor ki ng i n f i nance, per sonnel ,
inspect ion, revenue col l ect ion, real
est at e et c. rat her t han in conservancy,
wat er-supply, sanit at ion, healt h care,
ci t i zens’ wel f ar e et c. The pi ct ur e
t hat emerge is l argel y impersonal ,
non- appr eci at i ve, beaur ocr at i c
organizat ion wit h all negat ive feat ures
94
of a beaurocracy.
The resul t s of t he needs assessment
sur vey wer e shar ed wi t h t he
commissioner and his funct ional heads
in a one-day workshop. The resul t s
did not seem t o evoke any surprise
or concer n. It appear ed t hat t he
commissioner and his t eam were aware
of t hese issues. They accept ed t he
gener al desi gn of t he wor kshop
present ed by t he consul t ant s. The
workshops consi st ed of a seri es of
compet ency-building exercises based
on t he t hemes of l earning, qual it y
of work l if e, int erpersonal rel at ions,
t eam wor k, and l eader shi p. The
concept s and t he exercises were woven
around sessions which involved working
on real , t ask rel at ed i ssues i n t he
organizat ion. In keeping wit h our view
of OD, t he workshops were designed
t o hel p t he part icipant s ref l ect on
t heir experiences, learn collaborat ively
and work t oget her t o generat e choices
and opt ions t o solve key organizat ional
probl ems and mast er t he process t o
go t hr ough t he j oy of wor k. Each
workshop was at t ended by 20 senior
of f icers and l ast ed f or t hree days.
On t he last day t he part icipant s worked
i n smal l t eams and made speci f i c
recommendat ions t o t ackl e t he key
pr obl ems i n t he or gani zat i on. The
present at ions were usual l y at t ended
by t he commissioner and occasionally
by ot her funct ional heads who act ively
part icipat ed in t he discussion. The
consult ant received very good feedback
r egar di ng t he pr ogr ammes. The
commissioner and his funct ional heads
expressed t heir prof ound sat isf act ion
r egar di ng t he OD pr ogr ammes.
However, t he consult ant s had no idea
 ORGANISATIONAL DEVELOPMENT (OD) INTERVENTION IN PUBLIC UTILITY - THE CASE OF
SUNDARPUR MUNICIPAL CORPORATION : BHATTACHARYA
of what had real l y happened af t er
t he pr ogr ammes.
Two years hence t he consult ant s were
again request ed t o design and organize
si mi l ar wor kshops f or t he seni or
of f icers at SMC. When t he consul t ant
expressed a desire t o conduct a st udy
of t he seni or of f i cers’ mot i vat i on,
t he corporat ion eagerl y gave t hem
t he access f or col l ect ing dat a. This
t ime t he consul t ant s int erviewed al l
t he senior of f icers in groups of f ive
t o eight officers. Int erest ingly enough,
t he int erviews reveal ed f eel ings of
anger, f r ust r at i on, r esent ment ,
st agnat ion, powerl essness and l ack
of purpose among t he senior of f icers.
Some of t he quot es f r om t he
int erviews are reproduced bel ow t o
capt ure t he essence of t hese f eelings.
The seni or of f i cer s per cei ved t he
organizat ional st ruct ure and processes
as incapabl e of accommodat ing t heir
views and ideas. They f el t t hat t hey
had access t o only limit ed informat ion.
They report ed numerous anomal ies,
par adoxes, and cont r adi ct i ons i n
decision-making. And t here was no
way by which t hey can inf l uence t he
decision-making processes. They f elt
most l y marginal in t he organizat ion.
In a sense, t he i nt ervi ews seemed
t o indicat e t hat l it t l e had changed
in t he organizat ion. The core issues,
pr obl ems, and concer ns r emai ned
unresol ved.
Excerpt s from Int erviews
z There are may paradoxes in t his
organizat ion. You find t hat senior
of f icers are being put in a corner
wit hout work. You f ind peopl e
t hi nki ng t hat t hey have
compl et ed t he work when t hey Case
rel ease a ci rcul ar. You f i nd a Study
syst em of ident if icat ion of key
t asks, wit hout any consequences
of per f or mance or non-
per f or mance.
z There is very lit t le consult at ion.
As a seni or of f i cer, I r ecei ve
no informat ion on policy mat t ers
i n my ar ea of wor k and so I
have lit t le commit ment t o t hose
deci si ons.
z I f eel l ike a bul l ock drawing a
car t . When a mi l est one i s
cr ossed, t he bul l ock never
receives a pat .
z I f eel l ike a wel l -f ed parrot in
a golden cage. There is securit y, ... the interviews
but no f reedom, no excit ement . revealed feelings of
anger, frustration,
z Present l y t he onl y reward f or
resentment,
perf ormance is assignment t o
stagnation,
a chal l engi ng j ob, whi ch i s
deci ded at t he l evel of t op
powerlessness and
management . When your boss
lack of purpose
has no discret ion, he is redundant among the senior
for all pract ical purposes. In fact officers.
, he compet es wit h you f or t op
management ’ s f avour s.
z My t ot al j ob cont ent f ills barely
t wo hours in a working day. My
skil l s have cert ainl y gone down
in t he l ast f ive years.
z Our t ime goes in act ivit y where
we f eel comf ort abl e. Some of
us do our personal t hings, pl ay
t he st ock market s; some of us
choose t o put punct uat ion and
cor r ect gr ammar i n our
subordinat es’ writ e-ups; some
check records, prepare report s,
or cl ear f il es. These may not
95
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Case be t he t asks t hat we ought t o
Study be per f or mi ng, but ar e
comf ort abl e and keep us f rom
st raying int o areas where t here
ar e pr obl ems and no easy
answer s.
z For ever y i ssue, one i s f i r st
required t o open a f il e. The
f il e makes it s rounds t hrough
several of f ices, wit h individuals
adding t heir not es, writ ing t heir
comment s, and making t he f il e
t hick over period of t ime. You
need expert ise in buil ding good
cases on f il es. Individual s can
scut t le your case in subt le ways.
You need members in your t eam
who can count er t hem
There is no demand ef f ect ivel y.
for performance z The people in my sect ion haven’ t
upward or wor ked i n any ot her sect i on.
downward. I think They ident if y so st rongl y wit h
our biggest crisis is our gr oup t hat r ej ect i on and
that we accept lower humi l i at i on of ot hers i s what
and lower standards. pl eases t hem most . When I t al k
of ext ending a hel ping hand or
maki ng concessi ons t o ot hers
i n t he l ar ger or gani zat i onal
int erest , t hey t hink I have no
spi ne. The or gani zat i on
r ei nf or ces such par ochi al i sm
t hrough mechanist ic f ormul ae
f or allocat ing rewards. This set s
up each group against t he rest
of t he organi zat i on.
z Senior of f icers are const ant l y
shuf f l ed around. They do not
know wher e t hey woul d be
t omor r ow. Wher ever t hey go
t hey sign papers, writ e not es
and move f il es. There are no
ot her expect at ions f rom t hem.
96
z Everyt hi ng get s ri t ual i zed. In
meet ings, real concerns do not
get expressed. The syst em of
mont hl y r epor t s and dai l y
coor di nat i on meet i ngs have
st opped. People t hink t hat t hey
have compl et ed t he work when
t hey report a mat t er. There is
no demand f or per f or mance
upward or downward. I t hi nk
our bi ggest cr i si s i s t hat we
accept lower and lower st andards.
z We have a syst em of seniorit y-
based promot ions. I am 36t h on
t he l ist of 40. I want t o work
hard, and I want t o know how
I can become No. 1. But my
superior has no answer.
Re-ent ry and cont ract ing
At t hi s st age a meet i ng was hel d
wit h t he commissioner wit h his t op
management t eam, which incl uded
al l f unct i onal heads of SMC, t o
underst and t he issues of deeply root ed
organisat ional cult ure, t he operat ions
and t he st ruct ure of t he organisat ion.
On t he basis of a f ew more meet ings
and t hread-bare discussion, a working
paper on t he subj ect was prepared.
The working paper consist ed of f our
part s deal ing wit h:
z Our underst anding at t hat t ime
of some of t he key issues involved
z A concept ual f r amewor k
devel oped to f or mul at e
int errel at ions
z Cert ain hypot heses, assumpt ions
and proposit ions t hat were t o
be t he bases of design of t he
OD pr ogr amme
 ORGANISATIONAL DEVELOPMENT (OD) INTERVENTION IN PUBLIC UTILITY - THE CASE OF
SUNDARPUR MUNICIPAL CORPORATION : BHATTACHARYA
z The out l ine of t he int ervent ion
plans
The working paper emphasised t hat
any change i n t he envi r onment
demanded r e-exami nat i on and r e-
adj ust ment of several issues wit hin
a syst em whi ch was embedded i n
t he environment . One of t he issues
was insecurit y. Habit s has been formed
and some degree of st abilit y achieved.
Radical change as envisaged by t he
commi ssi oner i n r est r uct ur i ng and
r edesi gni ng SMC i n t er ms of l ocal
muni ci pal out f i t s present ed a new
per spect i ve and demanded new
behaviour somet hing which had not
been t est ed bef ore, and resul t ed in
uncert aint y, anxiet y, and apprehension.
In developing t he design, t he following
hypot heses were used :
z It i s possi bl e t o exami ne t he
r el at ed knowl edge and i t s
l inkages wit h behaviour
z Such an exami nat i on can be
made at bot h t he rat i onal as
wel l as emot ional l evel s.
z Suit able hypot heses on personal,
organisat ional , and communit y
l evel s can be f r amed by an
individual who can al so gat her
dat a regarding his behaviour on
each dimension. He can analyse
t his dat a and accept and rej ect
t he hypot hesis he has f ramed
in regard t o his behaviour pat t ern
z Conf r ont at i on of i ssues l eads
t o development of t he individual’s
underst anding of t he lat ent issues
involved. This develops his insight
whi ch may pr ovi de hi m wi t h
added st rengt h and adequacy
in deal ing wit h his probl ems. Case
Study
z When l at ent i ssues such as
anxi et y, f ear s, and
apprehensi ons are brought t o
t he sur f ace and shar ed wi t h
ot hers, percept ions of t he issues
of change become more realist ic.
At t hat st age it is possibl e t o
sort out how f ar t he f ears are
r eal or unr eal , how f ar t hey
ar e per sonal or gener al ,
i ndi vi dual or syst emi c. Thi s
sor t i ng out may hel p ener gy
mobil isat ion.
z Sharing of anxiet y and inadequacy
reduce t he level of t hese feelings
The f ol l owi ng pr oposi t i ons wer e
suggest ed f or t he OD programmes: The more an
z Changes are more likely t o occur
individual believes
i f t he set t i ng dramat i zes t he that he can, will, or
should change, the
import ance of working int ensely
more likely it is that
on t hese and l if t s t hem out of
the organised
t he r out i ne of ever yday l i f e,
t her eby cr eat i ng an i n-gr oup attempts to change
f eeling among t he part icipant s. would succeed.
z The more an individual believes
t hat he can, wi l l , or shoul d
change, t he mor e l i kel y i t i s
t hat t he organised at t empt s t o
change woul d succeed.
z The mor e t hor oughl y an
individual explores his personal
or i ent at i ons, st yl es,
apprehensions, et c. and relat es
t hem t o sel f -act ual isat ion, t he
more l ikel y he is t o experiment
and change.
z The mor e an i ndi vi dual can
conf ront hi msel f on hi s usual
st yle of int erpersonal int eract ion,
t he more he is l ikel y t o change.
97
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Case z The mor e an i ndi vi dual can
Study perceive and experience t he new
at t empt s at changes as
consist ent wit h t he ideal sel f -
i mage, t he more t he changes
are l ikel y t o be sust ained.
z The more t he self -conf ront at ion
occur in a f ace-t o-f ace group,
i n a cl i mat e suppor t i ng such
conf r ont at i on, t he mor e t he
individual is l ikel y t o devel op
insight int o his behaviour.
z The more a group devel ops a
climat e of support , wit h a norm
of unhesit at ingl y giving t o each
ot her, t he deeper and mor e
sust ained t he l earning is l ikel y
t o be.
Changes are likely to z The more int ense and persist ent
occur and persist if t he int eract ional meet ings are,
they are a sign of t he deeper, and more enduring
t he learning about t he self would
membership in a new
be.
continuing reference
group. z The more an individual perceives
t he change in his behaviour (e.g.
bei ng mor e conf r ont i ng) i s
required by t he demand of his
career and l if e sit uat ion, t he
more l ikel y he is t o experiment
and accept t he change.
z The mor e an i ndi vi dual can
percei ve and experi ence, t he
new changes at t empt ed as
consist ent wit h t he prevail ing
cul t ural val ues and norms, t he
more t he changes are l ikel y t o
be sust ained.
z The mor e an i ndi vi dual can
exami ne t he dynami cs of t he
event s in his everyday l if e, t he
98
more likely is t he int ernalisat ion
of his l earning.
z The more an individual can l ink
t he newly developed insight int o
per sonal and i nt er per sonal
dynamics t o act ion, t he more
l ikel y it is f or change in bot h
behaviour and act ion t o occur
and endure.
z The more an individual commit s
himsel f t o achieving concret e
goal s in l if e consist ent wit h t he
new i nsi ght s, t he mor e t he
change in likely t o get st abilized.
z The more an individual keeps
record of his progress t owards
achieving goal s t o which he is
commi t t ed, t he mor e t he
accept ed change i n l i kel y t o
i nf l uence hi s f ut ur e t hought s
and act i ons.
z Changes are l ikel y t o occur and
per si st i f t hey ar e a si gn of
membership in a new cont inuing
r ef er ence gr oup.
Wit hin a f ew days of present ing t he
working paper t o t he commissioner
it was was discussed in a divisional
commi t t ee. The mai n st and t aken
was t hat of aggressive pursuance of
t he plan of act ions specially in creat ing
Local Municipal Corporat ions covering
a wi der r ange of popul at i on. The
proposal was al so accept ed.
Int ervent ion Planning
In t he pl anning of t he int ervent ions
t he f ollowing issues were considered:
z The uni t wi t h whi ch t he
int ervent ion was t o be used
 ORGANISATIONAL DEVELOPMENT (OD) INTERVENTION IN PUBLIC UTILITY - THE CASE OF
SUNDARPUR MUNICIPAL CORPORATION : BHATTACHARYA
z The overal l obj ect ives and t he
speci f i c obj ect i ves of t he
int ervent ions
z The t ype and nat ur e of t he
int ervent ions
z Phasing, sequencing and linkage
of i nt ervent i ons.
Phasing, Sequencing, and Linkage
The nat ur e of t he t asks and t he
obj ect ives of t he programmes were
such t hat t he int ervent ions had t o be
on t he l iving syst ems. For exampl e,
al l t he members part icipat ed (af t er
t heir part icipat ion in t he basic l ab)
in or gani sat i onal di agnosi s,
implement at ion of t heir act ion plans,
as wel l as pr epar at i on and
impl ement at ion of act ion pl ans f or
t heir houses.
Bef ore wit hdrawal of t he consult ant s,
st abilisat ion and consolidat ion of t he
change ef f or t had t o be pl anned.
This was t o be t echnically an at t empt
t o ref reeze, and obviousl y t he l ast
i nput .
Accordingl y, t he int ervent ions were
at t empt ed in t he f ol l owing order:
z Basic l aborat ory
z Int ernal resource devel opment
z Organi sat i onal di agnosi s
z Reviews l aborat ory f or int ernal
resource person
z St abil isat ion
The t ot al OD programme was planned
t o be compl et ed in a period of 12-
15 mont hs. The basi c l abor at or i es
were t o be provided wit hin t he f irst
si x mont hs, f ol l owed by i nt er nal
resource development . Orgnisat ional Case
diagnosis was pl anned f or af t er f our Study
mont hs and was t o cont inue t hereaft er.
At t he end of t he year when t he
r evi ew l abor at or y was over, t he
int ernal resource persons went back
t o t heir respect ive depart ment s and
t he t erminal phase st art ed.
Some import ant input s in t he basic
l aborat ory were: microl ab, personal
st ruct ured dat a, panel discussion of
organisat ional st rat egy, act ion pl an,
and eval uat ion. It may be usef ul t o
ment ion t he st eps in t he preparat ion
of act ion pl ans f or t he depart ment s:
z Prepari ng a mast er l i st of al l
probl ems of t he depart ment s
perceived by it s members present
in t he new group.
Before withdrawal of
z Priorit izing t he problems on t he the consultants,
basis of t hree crit eria: urgency stabilisation and
of t he probl em, f easibil it y of consolidation of the
act ion, and minimal requirement change effort had to
of ext ernal resources be planned.
z Sel ect i on of a pr obl em and
def ining it specif ical l y
z Dynamics of possibl e causes
z For ce f i el d anal ysi s of t he
probl em
z Devising al t ernat ive st rat egies
f or sol ut ion and sel ect ing one
of t he alt ernat ives Planning t he
act ion st eps, including t he t ime
schedul e f or act i on t o be
compl et ed.
z Ant icipat ion of dif f icul t ies
z Consi derat i on of hel p needed
and pl anning f or t hat hel p
Those pl ans were present ed by t he
99
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Case pl anning modul e t o t he whol e group
Study in t he open house session f or crit ical
review, and were l at er revised. Af t er
revision t he group commit t ed bef ore
t he open house t o work on t he act ion
pl an on t hei r ret urn. The st rat egy
t o i nvol ve ot her member s of t he
depart ment s (who were not present )
was al so discussed.
Stabilisation and Termination
Reinf orcement Lab (RL) was held nine
mont hs af t er t he Int ernal Resource
Devel opment (IRD) l aborat ory. The
maj or t hrust s of t he reinf orcement
l ab was t o bring in mat urit y in pl ace
of an exuber ance of ent husi asm
r esul t i ng i n over ambi t i ous act i on
pl anni ng. Not wi t hst andi ng t he
The confrontation short comings in t he original select ion
proved very useful of i nt er nal f aci l i t at or s and t he
and the issue was subsequent st r uggl e, af t er t he
reinforcement lab consult ant s renewed
resolved through the
f ait h in t he st rengt h of t he int ernal
hard work of the
f acil it at ors and t heir sel f conf idence
conflicting parties.
was r ei nf or ced. The consul t ant s
t hought it was t ime f or t hem t o pl an
t hei r wi t hdr awal . Bef or e t he
consul t ant s wi t hdr ew f i nal l y t hey
Quest ions :
1. Comment whet her t he t raining
workshops were a wast e of t ime.
2. Was t he OD i nt er vent i on a
f ai l ur e? What l essons can we
learn from t his experience about
100
t hought it was necessary t o at t end
t o a f ew issues, one of which was
helping t o resolve some conf lict , t hat
arose at t he management l evel of
plan renovat ion. One of t he consult ant s
spent quit e some t ime in a depart ment
t o counsel on t his issue and arrange
conf ront at ion meet ings bet ween t he
conf lict ing part ies. The conf ront at ion
proved very usef ul and t he issue was
resol ved t hrough t he hard work of
t he conf l ict ing part ies.
In t he gr adual wi t hdr awal pr ocess
t he consul t ant s made it cl ear t o t he
organizat ion t hat t hey did not t hink
any ot her di r ect i nt er vent i on was
needed anymore, but t hey would like
t o visit and hel p SMC at any point
of t ime. However, it was made cl ear
t hat such request s f or hel p must be
channelled t hrough t he commissioner,
af t er t hey had done al l t hat t hey
coul d do t o hel p t hemsel ves. These
crit eria were set f ort h t o underscore
t he need for self-help and self-reliance.
It was sat isf ying t hat t hey did not
need much out side hel p. They real l y
depended on t hei r own ski l l s and
abil it ies.
organizat ional change in general,
and OD in part icul ar?
3. What should be done dif f erent ly
t o change t hi s organi zat i on?
 HOW LEADERS CREATE AND USE NETWORKS : IBARRA & HUNTER
How Leaders Create and Use Networks
Herminia Ibarra*
Mark Hunt er**
Senior managers f ind l it t l e t ime t o
creat e and improve upon use net works
t o avoid being out of l oop inside as
wel l as out side t he company. Thirt y
manager s wer e st udi ed f or t he
l eadership t ransit ion, an inf l ect ion
point in t heir careers t hat challenges
t hem t o ret hink bot h t hemsel ves and
t hei r rol es. In t he process, i t was
f ound t hat net working – creat ing a
f abric of personal cont act s who wil l
provide support , f eedback, insight ,
r esour ces, and i nf or mat i on – i s
simul t aneousl y one of t he most sel f -
evident and one of t he most dreaded
development al challenges t hat aspiring
l eader s must addr ess. When i t i s
r equi r ed t o move beyond t hei r
f unct i onal speci al t i es and addr ess
st r at egi c i ssues f aci ng t he over al l
busi ness, many manager s do not
immediat ely grasp t hat t his will involve
r el at i onal not anal yt i cal – t asks.
Somet i mes t he manager s we wor k
wit h say t hat t hey f ind net working
insincere or manipul at ive – at best ,
an el egant way of using peopl e.
Thr ee di st i nct but i nt er dependent
f or ms of net wor ki ng have been
discovered in t he st udy– operat ional,
Article
Digest
personal , and st rat egic which pl ayed
a vit al rol e in t heir t ransit ions. The
f i r st hel ped t hem manage cur r ent
int ernal responsibil it ies, t he second
boost ed t heir personal development ,
and t he t hird opened t heir eyes t o
new busi ness di r ect i ons and t he
Three distinct but
st akeholders t hey would need t o enlist . interdependent forms
It was f ound t hat al most al l of t hem of networking have
under ut il ized st rat egic net working. been discovered in the
study– operational,
Operat ional Net working
personal, and
Operat ional net works include not only strategic
direct report s and superiors but al so
peers wit hin an operat ional unit , ot her
int ernal pl ayers wit h t he power t o
bl ock or support a proj ect , and key
out siders such as suppliers, dist ribut ors,
and cust omers. The purpose of t his
t ype of net wor ki ng i s t o ensur e
coordinat ion and cooperat ion among
peopl e who have t o know and t rust
one anot her in order t o accompl ish
t hei r i mmedi at e t asks. Most
operat ional net working occurs wit hin
an or gani zat i on, and t i es ar e
det ermined in l arge part by rout ine,
short t erm demands. Rel at i onshi ps
f ormed wit h out siders, such as board
members, cust omers, and regulat ors,
are di rect l y t ask-rel at ed and t end
101
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Article t o be bounded and const rai ned by
Digest demands det ermined at a higher level.
Personal Networking
Thr ough pr of essi onal associ at i ons,
al umni groups, cl ubs, and personal
int erest communit ies, managers gain
new per spect i ves t hat al l ow t hem
t o advance in t heir careers. This is
what is meant by personal net working.
A per sonal net wor k can al so be a
saf e space f or personal devel opment
and as such can provide a f oundat ion
f or st rat egic net working. According
t o t he famous six degrees of separat ion
principl e, our personal cont act s are
valuable t o t he ext ent t hat t hey help
us reach, in as f ew connect ions as
What differentiates a possibl e, t he f ar-of f -person who has
t he inf ormat ion we need. It wil l be
leader from a
seen t hat personal net working wil l
manager, research
not hel p a manager t hr ough t he
tells us, is the ability
leadership t ransit ion unless he or she
to figure out where to
learns how t o bring t hose connect ions
go and to enlist the
t o bear on organizat ional st rat egy.
people and groups
necessary to get there. St rat egic Net working
When managers begin t he del icat e
t ransit ion f rom f unct ional manager
t o business l eader, t hey must st art
t o concer n t hemsel ves wi t h br oad
st rat egic issues. What dif f erent iat es
a l eader f rom a manager, research
t el l s us, is t he abil it y t o f igure out
where t o go and t o enl ist t he peopl e
and groups necessary t o get t here.
The key t o a good st rat egic net work
i s l everage: t he abi l i t y t o marshal
inf ormat ion, support , and resources
f r om one sect or of a net wor k t o
achi eve r esul t s i n anot her. One
manager in t he st udy used his personal
passion, hunt ing, t o meet people f rom
102
professions as diverse as st onemasonry
and househol d moving. Al most none
of t hese hunt ing f riends had anyt hing
t o do wit h his work in t he consumer
el ect ronics indust ry, yet t hey al l had
t o deal wi t h one of hi s own dai l y
concer ns: cust omer r el at i ons. The
key was his abil it y t o buil d inside-
out side l inks f or maximum l everage.
Mind your mind-set
What ever t he reason, when aspiring
leaders do not believe t hat net working
i s one of t he most i mpor t ant
requirement s of t heir new j obs, t hey
wi l l not al l ocat e enough t i me and
ef f ort t o see it pay of f . What appears
t o be unpal at abl e or unproduct i ve
behaviour t akes on a new l ight when
a per son you r espect does i t wel l
and et hically. Net working ef f ect ively
and et hically, like any ot her t acit skill,
is a mat t er of j udgment and int uit ion.
Work from the outside in
It ’ s dif f icul t t o buil d a rel at ionship
wi t h anyone, l et al one a seni or
execut i ve, wi t hout a r eason f or
int eract ing, l ike a common t ask or
a shared purpose. Ot her managers
buil d out side-inside connect ions by
usi ng t hei r f unct i onal i nt er est s or
expert ise. For example, communit ies
of pract i ce exi st (or can easi l y be
creat ed on t he Int ernet ) in al most
every area of busi ness f rom brand
management t o Six Sigma t o gl obal
st rat egy. Savvy managers reach out
t o ki ndr ed spi r i t s out si de t hei r
or gani sat i ons t o cont r i but e and
mul t i pl y t hei r knowl edge; t he
inf ormat ion t hey gl ean.
The l ess t hey pract ice net working,
 HOW LEADERS CREATE AND USE NETWORKS : IBARRA & HUNTER
t he l ess ef f icient at it t hey become,
and t he vi ci ous cycl e cont i nues. A
net work l ives and t hrives onl y when
it is used. A good way t o begin is t o
make a simpl e request or t ake t he
init iat ive t o connect t wo peopl e who
woul d benef i t f r om meet i ng each
ot her. Doing somet hing – anyt hing –
get s t he bal l r ol l i ng and bui l ds
conf idence t hat one does, in f act ,
have somet hing t o cont ribut e.
But net working is not a t al ent ; nor
does i t r equi r e a gr egar i ous,
ext rovert ed personal it y. It is a skil l ,
one t hat t akes pract ice. That peopl e
who work at net worki ng can l earn
not onl y how t o do it wel l but al so
how t o enj oy it .
Aspiring l eaders must l earn t o buil d
and use st rat egic net works t hat cross
or gani zat i onal and f unct i onal
boundaries, and t hen l ink t hem up Article
in novel and innovat ive ways. It is a Digest
chal l enge t o make t he l eap f rom a
l if et ime of f unct ional cont ribut ions
and hands on cont rol t o t he ambiguous
pr ocess of bui l di ng and wor ki ng
t hrough net works. Net working is t o
be accorded one of t he most import ant
r equi r ement by manager s i n new
leadership rile. In order t o get bet t er
pay of f , it cal l s f or enough t ime and
ef f or t f or cr eat i ng and usi ng
net working product ivel y.
Art icle Digest Prepared by :
Dr. Hari Haran
DGM (Academic) & Sr Facult y Member
MTI, SAIL, Ranchi.
Source : Aspiring leaders must
Harvard Business Review (pp. 40-47)
learn to build and
January 2007
use strategic networks
that cross
organizational and
functional boundaries
103
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Article Becoming the Boss
Digest
Linda A. Hill*
The earliest t est of leadership comes
wit h t hat f irst assignment t o manage
ot hers. Most new managers init ial l y
f ai l t hi s t est because of a set of
common misconcept ions about what
To help new it means t o be in charge. Organizat ions
managers pass this suffer considerable human and financial
first leadership test, cost s when a person who has been
we need to help them promot ed because of st rong individual
understand the perf ormance and qual if icat ions f ail s
essential nature of t o adj ust successf ully t o management
their role - what it responsibil it ies.
truly means to be in The f ail ures aren’ t surprising, given
charge. t he dif f icul t y of t he t ransit ion. Ask
any new manager about t he ear l y
days of being a boss-indeed, ask any
senior execut ive t o recal l how he or
she f el t as a new manager. If you
get an honest answer, you’ l l hear a
t al e of disorient at ion and, f or some,
overwhelming confusion. The new role
didn’ t feel anyt hing like it was supposed
t o. It f el t t oo big f or any one person
t o handl e. And what ever it s scope,
it sure didn’ t seem t o have anyt hing
t o do wit h l eadership.
To hel p new managers pass t his f irst
leadership t est , we need t o help t hem
underst and t he essent ial nat ure of
104
t heir rol e - what it t rul y means t o
be in charge. Most see t hemsel ves
as managers and l eaders; t hey use
t he r het or i c of l eader shi p; t hey
cert ainly feel t he burdens of leadership.
But t hey j ust don’ t get it .
New managers are surprised t o l earn
t hat t he skil l s and met hods required
for success as an individual cont ribut or
and t hose required f or success as a
manager are st arkl y dif f erent - and
t hat t her e i s a gap bet ween t hei r
cur r ent capabi l i t i es and t he
requi rement s of t he new posi t i on.
In t heir prior j obs, success depended
primaril y on t heir personal expert ise
and act ions. As managers, t hey are
r esponsi bl e f or set t i ng and
impl ement ing an agenda f or a whol e
gr oup, somet hi ng f or whi ch t hei r
car eer s as i ndi vi dual per f or mer s
haven’ t prepared t hem.
Learning t o lead is a process of learning
by doi ng. It can’ t be t aught i n a
cl assr oom. It i s a cr af t pr i mar i l y
acqui r ed t hr ough on- t he- j ob
exper i ences - especi al l y adver se
experiences in which t he new manager,
working beyond his current capabilit ies,

proceeds by t rial and error. Most st ar
individual perf ormers haven’ t made
many mi st akes, so t hi s i s new f or
t hem. Furt hermore, f ew managers
are aware, in t he st ressf ul , mist ake-
maki ng moment s, t hat t hey ar e
l ear ni ng. The l ear ni ng occur s
increment al l y and gradual l y.
As t his process sl owl y progresses -
as t he new manager unlearns a mind-
set and habit s t hat have served him
over a highly successf ul early career-
a new prof essional ident it y emerges.
He int ernal izes new ways of t hinking
and bei ng and di scovers new ways
of measur i ng success and der i vi ng
sat i sf act i on f r om wor k. Not
surprisingly, t his kind of psychological
adj ust ment i s t axi ng.
The t ransit ion is of t en harder t han
it need be because of new managers’
misconcept ions about t heir rol e. By
acknowl edgi ng t he f ol l owi ng
mi sconcept i ons-some of whi ch ri se
al most t o t he l evel of myt h in t heir
near - uni ver sal accept ance- new
managers have a f ar great er chance
of success.
Managers wield significant authority:
Managers assume t he posi t i on wi l l
give t hem more aut horit y and, wit h
t hat , more f reedom and aut onomy
t o do what t hey t hi nk i s best f or
t he organizat ion. Inst ead of gaining
new aut horit y, t hey f ind t hemsel ves
hemmed in by int er-dependencies.
Inst ead of f eel i ng f r ee, t hey f eel
const rained, especial l y if t hey were
accust omed to t he r el at i ve
i ndependence of a st ar perf ormer.
They ar e enmeshed i n a web of
r el at i onshi ps - not onl y wi t h
BECOMING THE BOSS : HILL
subordi nat es but al so wi t h bosses, Article
peers, and ot hers inside and out side Digest
t he organizat ion, al l of whom make
r el ent l ess and of t en conf l i ct i ng
demands on t hem. The result ing daily
r out i ne i s pr essur ed, hect i c, and
f r agment ed.
Unt il t hey give up t he myt h of aut horit y
f or t he r eal i t y of negot i at i ng
int erdependencies, new managers will
not be abl e t o l ead ef f ect ivel y.
Authority flows from the manager’s
posit ion: Most new manager s
mist akenly believe t heir power is based
on t he f ormal aut horit y t hat comes
wit h t heir now l of t y-wel l , rel at ivel y
speaki ng-posi t i on i n t he hi erarchy.
Af t er a f ew painf ul experiences, new
Until they give up the
manager s come t o t he unset t l i ng
realizat ion t hat t he aut horit y emerges
myth of authority for
onl y as t he manager est abl i shes
the reality of
credibil it y wit h subordinat es, peers, negotiating
and superiors t hrough t heir charact er. interdependencies,
This is of part icul ar import ance t o new managers will
subordinat es, who t end t o anal yze not be able to lead
every st at ement and nonverbal gest ure effectively.
f or signs of t he new boss’ s mot ives.
Such scrut iny can be unnerving.” They
need to demonst r at e t hei r
compet ence, but whil e evidence of
t echnical compet ence is import ant
in gaining subordinat es’ respect , it
isn’ t ul t imat el y t he primary area of
compet ence t hat direct report s are
l ooki ng f or.
Managers must control their direct
reports: Most new managers, in part
because of insecurit y in an unf amiliar
role, yearn f or compliance f rom t heir
subordinat es. They f ear t hat if t hey
don’ t est abl ish t his earl y on, t heir
direct report s will walk all over t hem.
105
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Article However compl iance does not equal need t o real ize t hey are responsibl e
Digest commi t ment . If peopl e ar en’ t f or r ecommendi ng and i ni t i at i ng
commi t t ed, t hey won’ t t ake t he changes t hat will enhance t heir groups’
init iat ive. And if subordinat es aren’ t per f or mance. Of t en, t hi s means
t aki ng t he i ni t i at i ve, t he manager chal l enging organizat ional processes
can’ t delegat e ef f ect ively. The direct or st ruct ures t hat exi st above and
r epor t s won’ t t ake t he cal cul at ed beyond t heir area of f ormal aut horit y.
risks t hat lead t o t he cont inuous change
In f act , most new manager s see
and improvement required by t oday’s
t hemselves as t arget s of organizat ional
t urbul ent business environment . The
change init iat ives, implement ing wit h
more power managers are wil l ing t o
t heir groups t he changes ordered f rom
share wit h subordinat es in t his way,
above. They don’ t see t hemsel ves
t he mor e i nf l uence t hey t end t o
as change agent s. Hierarchical t hinking
command. When t hey lead in a manner
and t heir f ixat ion on t he aut horit y
t hat al l ows t heir peopl e t o t ake t he
t hat comes wit h being t he boss l ead
i ni t i at i ve, t hey bui l d t hei r own
t hem t o def ine t heir responsibil it ies
credibil it y as managers.
... most new t oo narrowly. Consequent ly, t hey t end
managers see Managers must focus on forging good t o bl ame f l awed syst ems, and t he
themselves as targets individual relat ionships: Managing superiors direct ly responsible for t hose
of organizational i nt er dependenci es and exer ci si ng syst ems, f or t hei r t eams’ set backs
change initiatives, i nf or mal aut hor i t y der i ved f r om - and t hey t end t o wai t f or ot her
per sonal cr edi bi l i t y r equi r e new peopl e t o f ix t he probl ems.
implementing with
managers t o buil d t rust , inf l uence,
their groups the But t hi s represent s a f undament al
and mut ual expect at ions wit h a wide
changes ordered from misunderst anding of t heir role wit hin
array of people. Ult imat ely, however,
above. They don’t see t he organizat ion. New managers need
t he new manager must f i gur e out
themselves as change t o generat e changes, bot h wit hin and
how t o harness t he power of a t eam.
agents. out side t heir areas of responsibil it y,
Si mpl y f ocusi ng on one- on- one
t o ensure t hat t heir t eams can succeed.
rel at i onshi ps wi t h members of t he
They need t o wor k t o change t he
t eam can undermi ne t hat process.
cont ext in which t heir t eams operat e,
By shaping t eam cul t ure-t he group’ s
ignoring t heir lack of f ormal aut horit y.
norms and values - a leader can unleash
t he probl em-sol ving prowess of t he As t hey go t hrough t he daunt ing process
diverse t alent s t hat make up t he t eam. of becoming a boss, new managers
can gai n a t r emendous advant age
Managers must ensure that things
by l ear ni ng t o r ecogni ze t he
run smoothly: Like many managerial
misconcept ions j ust out lined. But given
myt hs, t his one is part l y t rue but is
t he mul t il ayered nat ure of t heir new
misleading because it t ells only some
responsibil it ies, t hey are st il l going
of t he st ory. Indeed, t he compl exit y
t o make mist akes as t hey t ry t o put
of mai nt ai ni ng t he st at us quo can
t oget her t he managerial puzzle - and
absorb al l of a j unior manager’ s t ime
maki ng mi st akes, no mat t er how
and energy. But new managers al so
import ant t o t he l earning process,

106
 BECOMING THE BOSS : HILL

i s no f un. They ar e goi ng t o f eel t he new manager expect s. Event ually Article
pain as t heir prof essional ident it ies about hal f of new managers t urn t o Digest
are st ret ched and reshaped. As t hey t hei r bosses f or assi st ance, of t en
st ruggl e t o l earn a new rol e, t hey because of a l ooming crisis. Many
wil l of t en f eel isol at ed. are rel ieved t o f ind t heir superiors
more t ol erant of t heir quest ions and
Unf ort unat ely, f ew new managers ask
mist akes t han t hey had expect ed.
f or hel p because of t he mi st aken
bel ief t hat “ The boss is supposed t o Somet imes, t he most expert ment ors
have al l t he answers, so seeking hel p can seem decept ivel y hands-of f . It ’ s
is a sure sign t hat a new manager i mpor t ant f or t he bosses of new
i s a “ promot i on mi st ake. ” Anot her manager s t o under st and-or si mpl y
reason new managers don’ t seek help recal l -how dif f icul t it is t o st ep int o
is t hat t hey f ear t hat t his inf ormat ion a management role f or t he f irst t ime.
would be used against t hem, especially Hel pi ng a new manager succeed
in sharing probl ems wit t he superior. doesn’ t benef it onl y t hat individual .
The inherent conf l ict bet ween t he Ensuring t he new manager’ s success
rol es of eval uat or and devel oper is is also crucially import ant t o t he success Unfortunately, few
an age-old dilemma. So new managers of t he ent i re organi zat i on. new managers ask for
need t o be creat ive in f inding support . help because of the
For i nst ance, t hey mi ght seek out mistaken belief that
peers who are out side t heir region Art icle Digest Prepared by :
Sanj ay Dhar
“The boss is supposed
or f unct ion or in anot her organizat ion
Sr. Manager (Academic) & to have all the
al t oget her.
Sr Facult y Member answers, so seeking
When a new manager can devel op a MTI, SAIL, Ranchi. help is a sure sign
good rel at i onshi p wi t h hi s boss, i t Source : that a new manager
can make al l t he dif f erence in t he Harvard Business Review is a “promotion
world -t hough not necessarily in ways January 2007 mistake.”

107
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Book Leadership for the Ages
Review
David P. Hann*
The book ‘ Leadership f or t he Ages’
has br ought out di mensi ons of
l eader shi p whi ch manager s shoul d
consider f or sust aining l eadership in
t imes ahead of t hem. It s aut hor David
P. Hanna is t he f ounder of Conf luence
It has been concluded Consult ing whose mission is t o part ner
that you must adhere wit h l eaders at al l l evel s. He t ries
to the natural laws of t o al ign t hem wit h peopl e, syst em
living systems if you and nat ural laws t o creat e an enduring
would develop an st andard of excellence. A former senior
organisation for the consul t ant wit h Frankl in Covey and
ages. Proct or & Gamble, he has incorporat ed
his experience wit h t he cl ient s l ike
Merck, East man Chemical , General
Mot ors, Hoechst , Allied Signal, Xerox,
Siemens, Shel l et c in t his book. He
has present ed t he book f or managers
and l eaders who want t o do great
t hings and have got gl obal desire f or
“ more wi t h l ess” . Many wonderf ul
individuals have influenced t he cont ent
of t he book.
The book i s composed si x sect i ons
comprising 14 chapt ers deal ing wit h
di f f er ent aspect s of endur i ng
l eadership pract ices. Leadership and
t he Test of Time is t he f irst sect ion
of t he book which has been divided
int o t wo chapt ers. The point has been
108
very wel l reit erat ed in f irst chapt er
on ‘ The Seeds of Leadershi p’ t hat
everyt hing in t he global age is subj ect
t o change. Charact er and compet ence
are seeds of t he leadership and point
has been wel l made t hat bosses have
subor di nat es and l eader s have
f ol l owers.
Chapt er – 2 on Nat ur al Laws and
Li f ecycl es expl ai n or gani sat i onal
lif ecycle and similarly wit h lif ecycles
of civil isat ion have been brought out
by t he aut hor. Resembl ance wi t h
pr oduct l i f ecycl e has al so been
discussed t o general ise t he l if ecycl e
concept wit h universal Nat ural Laws
t o govern longevit y. The most enduring
syst ems are f ound in nat ure. Seven
charact erist ics of syst em have been
enumerat ed t o qualify as nat ural laws.
It has been concl uded t hat you must
adhere t o t he nat ural l aws of l iving
syst ems i f you woul d devel op an
organisat ion for t he ages. Organisat ion
f or ages can be devel oped by l eaders
who f ol l ow t he success pat t ern of
nat ural l aws.
The Leader’ s Core is t he t heme of
Sect i on- 2 whi ch compar es t wo
chapt ers. It begins wit h chapt er – 3

devot ed on ‘ Ear ni ng Tr ust ’ . It has
been explained wit h t he t wo import ant
f act s of a l eader (1) What a Leader
Is (Charact er) and (2) What a Leader
Does (Compet ence). Aut hor has drawn
t rust parallel wit h t he Emot ional Bank
Account met aphored by St ephen Covey.
Si t uat i ons and emot i ons can var y
signif icant ly and t hey do not produce
consist ency. Trust is buil t up when
t her e i s consi st ency on “ Wal k t he
Tal k” . The next chapt er on ‘ Fr om
subordinat e t o St eward’ st art s wit h
a very powerf ul paradigm t o medical
st udent s “ You can see what is behind
your eyes” . Whol e di agnosi ng a
pat ient , st udent s see t he possibilit ies
t heir t raining has placed in t heir head.
So t hey can onl y see what is behind
t heir eyes. The concept of “ int elligent
disobedience” has been prescribed
t o saf eguard st akehol der t rust s.
The aut hor has devot ed Sect i on–3
on ‘ Shapi ng a Compel l i ng Common
Purpose’ . The debat e on whet her a
Company’ s f ocus shoul d be t o buil d
shareholder value or st akeholder value.
It has been advocat ed in chapt er–5
i n t hi s sect i on t hat t her e i s mor e
compel l ing and pragmat ic reason t o
see an organisat ion as serving more
peopl e t han j ust sharehol ders and
cust omers. St akeholder f eedback and
organisat ion’s mission build up synergy.
Number of examples have been given
in chapt er-6 about shaping compelling
mission. Example of Shell Oil Company
has been described how t he company
moved f r om despai r t o r ebi r t h. It
has been concl uded t hat t he magic
of mission st at ement s is t o be f ound
in t he processes used t o creat e and
nurt ure t hem. Aut hor has deal t wit h
t he sit uat ion in subsequent chapt er
LEADERSHIP FOR THE AGES : HANN
how t o deci de t he mi ssi on t o be Book
f ol l owed when each uni t and sub- Review
uni t of an organi sat i on are havi ng
separat e mi ssi ons.
It is import ant and chal l enging f or
l eaders t o buil d syst ems t hat never
rust . Sect ion-4 has covered t he aspect s
of buil ding such syst ems. ‘ Mapping
t he Ecosyst em’ is t he f irst chapt er
i n t hi s sect i on and t he aut hor has
int roduced a model t hat can be used
t o map t he el ement s t hat f orm t he
part of ecosyst em of an organisat ion.
El even l aws of Pet er Senge’ s “ Laws
of t he Fi f t h Di sci pl i ne” have been
revisit ed t o underst and t he nat ure
of organi zat i onal ecosyst ems. It i s
pert inent t o t race your organizat ional
root t o bui l d sound syst ems whi ch Eleven laws of Peter
never rust . Senge’s “Laws of the
Diagrammat ic illust rat ions have been Fifth Discipline” have
made by t he aut hor t o depi ct t he been revisited to
approach and st eps required t o reach understand the
t he organisat ional root s. Readers can nature of
relat e design element s of organisat ional
organizational
syst em and diagnose t he syst em before ecosystems.
prescribing t he charges in t he syst em.
It has been asser t ed t hat r eal
compet it ive advant age l ies in being
abl e t o dist inguish crit ical drivers/
r esi st or s f r om ext r aneous ones.
Chapt er –10 deal s wi t h how t o put
nat ural laws t o work. Af t er diagnosing
t he organisat ion you need t o engage
in t he design process of shaping and
reshaping t he element s of organisat ion
desi gn t o get t he desi r ed r esul t s.
Example of Rit z–Carlt on Hot el Company
has been narrat ed as a good exampl e
of an organisat ion design yiel ding a
hi gh per f or mance cul t ur e. Hi gh
perf ormance design principl es have
been described by t he aut hor in t his
chapt er. Aut hor has expl ained how
109
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Book t o al ign t hese design principl es wit h
Review nat ural l aws.
‘ When Part nerships are Synergist ic’
is t he capt ion of Chapt er-11 in which
t he aut hor deliberat es wit h paradigms
of synergy and part nerships. Paradigm
of Synergy has been expl ained wit h
meaning of it s t hree el ement s- Syn,
Er g and Ism. A syner gi st i c desi gn
pr ocess i s t o be f ol l owed f r om
paradigms. Part nership of Wal -Mart
and Pr oct or & Gambl e has been
exempl if ied as synergist ic approach
by t wo companies t o improve t heir
bot t omline. Examples of school, sport s
and heal t hcare make t he synergist ic
part nership as universal approach t o
gr ow.
Partnership of Wal- ‘ Leading a High Perf orming Cul t ure’
Mart and Proctor & is cent ral t heme of Sect ion-5 which
Gamble has been begins wit h chapt er-12 on embracing
exemplified as change. It has been advocat ed t hat
synergistic approach t he el ement s of Leadership f or t he
by two companies to Ages wi l l r equi r e some exi st i ng
improve their par adi gms, val ues and habi t s t o
bottomline. change. It has been il l ust rat ed wit h
a case t hat a last ing behaviour always
devel ops f rom t he inside out : f rom
a paradi gm shi f t t hat changes our
view of t he worl d, our sit uat ion, and
even our sel ves. A mat hemat i cal
f or mul a has been devel oped t o
summarise t he crit ical el ement s of
inside out change. Leading change
has been discussed in next chapt er.
Great leaders such as Mahat ma Gandhi,
Mart in Lut her King, Margaret That cher,
Jack Welch, Mikhail Gorbachev, Anwar
Sadat , Wal t Di sney, Mot her Ter esa
have been reminded in t his chapt er
t o bring f ort h t he point s of enduring
change. It has been emphat i cal l y
point ed out t hat l eaders of change
110
must under go a per sonal
t ransf ormat ion bef ore t hey at t empt
t o t r ansf or m t hei r or gani zat i onal
cul t ure.
Right l y t he l ast sect ion-6 has been
devot ed on ‘ Leadership t hat Last s’
which has t he l ast chapt er-14 t it l ed
as ‘ A Legacy f or t he Ages’ . The l ast
chapt er is purposely kept t o encourage
r eader s t o car r y t hr ough wi t h
resolut ions and act ion plans t o shape
somet hing which can l ast f or ages.
The aut hor has prompt l y ment ioned
t he advi ce of Wi nst on Churchi l l i n
l ast l ines of t he book t hat al l of us
get a special moment in our l if et ime
t o a very special t hing and we shoul d
avoid t he t ragedy t hat moment f inds
us unprepared and unqual i f i ed f or
t he work which woul d be our f inest
hour.
Ever y chapt er begi ns wi t h f ew
quot at ions appropriat e t o t he t heme
of t he chapt er. Sui t abl e exampl es
have been given in t he beginning of
most of t he chapt er s t o r el at e
subsequent discussion and development
of concept s. Each chapt er ends wit h
‘ Applying what you have learned’ which
l eads t o t hinking on act ion t o appl y
learnings. He has added value by giving
chapt er-wise ref erences used in each
chapt er at t he end of t he book.
Reviewed by :
Dr. Hari Haran
DGM (Acad. ) & Sr. FM
MTI, SAIL, Ranchi.
Source :
Jaico Publishing House, 2007
pp. 355
 FACILITATING TO LEAD - LEADERSHIP STRATEGIES FOR A NETWORKED WORLD : BENS
Facilitating To Lead - Leadership Strategies for
a networked world
Ingrid Bens*
Leader s who oper at e i n t oday’ s
net worked world of proj ect s and t eams
f i nd t hemsel ves i n a dynami c
envi ronment t hat di dn’ t exi st j ust
a f ew decades ago. Where managers
once over saw f unct i ons t hey had
pr evi ousl y per f or med t hemsel ves,
t oday’ s l eaders of t en head diverse
groups of special ist s whose areas of
expert ise are not f amil iar t o t hem.
Where supervisors t radit ionally worked
in close proximit y t o t heir st aff, t oday’s
empl oyees may be l ocat ed hundreds
or even t housands of mi l es away.
Where bosses once wiel ded absol ut e
aut hor i t y over compl i ant wor ker s,
t oday’ s l eader s of t en wor k wi t h
independent col l eagues over whom
t hey have l it t l e or no aut horit y. This
shif t in t he l eadership cont ext has
si gni f i cant i mpl i cat i ons f or t he
l eadership compet encies required t o
be ef f ect i ve. The command- and-
cont rol not ion of leadership t hat relied
on t he l eader’ s aut horit y or cont ent
exper t i se t o pr ovi de “ di r ect i ve
leadership” t o people who were willing
t o suborn t heir personal knowl edge
and wil l t o t he l eaders direct ion, no
longer works in an environment where
Book
Review
t hose being l ed are more l ikel y t o Where bosses once
have f ar superior knowl edge in t heir wielded absolute
domain t han t he l eader. authority over
compliant workers,
This shif t is get t ing accent uat ed by
today’s leaders often
t he use of mat rix organizat ion and
work with
proj ect t eam based worki ng wi t h
speci al i st s f rom di verse f i el ds and independent
somet i mes f r om di f f er ent colleagues over whom
or gani zat i onal uni t s or even they have little or no
organi zat i ons worki ng t oget her f or authority. This shift
specif ic proj ect s. Mat rix t eams are in the leadership
more l ikel y t o be goal driven t han context has
t ask driven. At t he same t ime t hat significant
organizat ions have been t ransforming, implications for the
empl oyees have been changi ng. leadership
Decades of hi gher educat i on and competencies required
personal aut onomy have alt ered worker
to be effective.
out l ooks and expect at i ons. These
younger workers have known const ant
change and are accust omed t o working
i n t eams. Inst ead of per manence,
t hey’ re more i nt erest ed i n f i ndi ng
meani ngf ul wor k t hat f eat ur es
opport unit ies t o learn and grow. They
al so expect t o be personal l y engaged
at work; t hey want t o cont rol t heir
workday and have a voice in import ant
deci si ons t hat af f ect t hem.
The combined ef f ect of t hese t rends
111
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007

Book is changing what it means t o be a t he role of t he f acilit at or. The belief s,

Review l eader in t oday’ s worl d of work:
z When t eam members are expert s
i n speci al t y ar eas t hat ar e
unknown t o t he l eader, i t i s
impossible for t he leader t o direct
st af f ef f or t s.
z When t eam members work i n
remot e l ocat ions and set t heir
own t i met abl e f or achi evi ng
personal deadl ines, t he l eader
is in no posit ion t o j udge st af f
ef f ect i veness t hr ough di r ect
obser vat i on.
z When t eam member s ar e
assigned t o a t eam or commit t ee
Just as the advent of i n whi ch bot h st af f i ng and
the industrial age budget s are cont rolled elsewhere,
created the need for t he l eader has f ew l ever s t o
new approaches to cont rol member act ions.
managing work, the z When t he wor k demands
proliferation of creat i vi t y and i nnovat i on and
matrix structures is
result s depend on people t aking
creating the need for
init iat ive, close oversight is fut ile
a transformation in
and serves onl y t o undermine
the role of the leader. individual init iat ive.
Just as t he advent of t he indust rial
age cr eat ed t he need f or new
approaches t o managing work, t he
prol if erat ion of mat rix st ruct ures is
creat ing t he need for a t ransformat ion
in t he rol e of t he l eader. This change
al so represent s an opport uni t y f or
leadership t hinking t o make a quant um
l eap f orward by t aking on t he f orm
t hat ref l ect s t he dimensions of t he
Int ernet age.
Of al l t he skil l set s t hat support t he
shif t f rom a t radit ional management
role t o a more collaborat ive approach,
none is more rel evant t han t hat of
behaviors, and pract ices of facilit at ion
are precisel y what al l l eaders need
t o acqui re and put i nt o act i on. In
"Faci l i t at i ng t o Lead! " r enowned
f acilit at ion expert Ingrid Bens applies
her proven concept s of f acil it at ion
t o t he leadership role and demonst rat es
t hat f acil it at ion is an ef f ect ive work
st yl e.
Faci l i t at i ve l eader shi p i s a ski l l ed
approach t o l eading t hat ’ s based on
t he core beliefs and pract ices of group
f acil it at ion. It makes ext ensive use
of process t ool s in order t o provide
st ruct ure and cast s t he l eader in t he
role of helper and enabler. Facilit at ive
l eader s shar e t he cor e bel i ef s of
f acil it at ion :
z Peopl e ar e i nt el l i gent and
capabl e, and t hey want t o do
t he ri ght t hi ng.
z Everyone’ s opinion has val ue,
regardless of an individual’s rank
or posi t i on.
z Groups can make bet t er decisions
t han individual s act ing al one.
z Peopl e are more commit t ed t o
t he ideas and pl ans t hat t hey
cr eat e.
z Peopl e wil l t ake responsibil it y
and assume account abil it y f or
t heir act ions and can become
part ners in t he ent erprise.
Facilit at ion is a process t hrough which
a person helps ot hers work effect ively.
It draws out t he knowl edge of group
members in order t o achieve superior
r esul t s. It val ues ever yone’ s
cont ribut ion, shares power, and inst ills
ownership. Facil it at ors hel p groups

112
 FACILITATING TO LEAD - LEADERSHIP STRATEGIES FOR A NETWORKED WORLD : BENS
improve t he qual it y and quant it y of
t hei r wor k by get t i ng member s t o
work t oget her more ef f ect i vel y.
z Inst ead of deal ing l argel y wit h
individuals, t hey work wit h people
i n groups.
z Inst ead of supervising hours of
oper at i on and measur i ng
workload, t hey help st aff ident ify
paramet ers wit hin which t hey
can become sel f -managi ng.
z Inst ead of direct ing t asks, t hey
mot i vat e peopl e t o achi eve
superior resul t s.
z Inst ead of direct ing t he mission,
t hey al i gn t eam ef f or t s wi t h
organizat ional goal s.
The ul t imat e goal of t he f acil it at ive
l eader is t o devel op t he l eadership
t al ent s of ot her s by i nst i l l i ng
confidence, aut horit y, and responsibilit y
in each person. They aim t o creat e
organizat ions t hat are part icipat ive,
r esponsi ve, and essent i al l y sel f -
managi ng, exact l y t he ki nd of
workplace in which knowledge workers
t hri ve.
Tr ue f aci l i t at i ve l eader s ar e mor e
t han j ust people savvy; t hey’ re group
process f ocused. They not onl y hol d
meet i ngs t o gai n st af f i nput , t hey
know how t o st ruct ure every t ype
of conversat ion t o ensure ef f ect ive
col l abor at i on. They do mor e t han
delegat e; t hey syst emat ically empower.
They are not onl y open t o empl oyee
i nput ; t hey del i ber at el y st r uct ur e
act ivit ies t o ensure t hat st aff evaluat e
t hem and each ot her on a regul ar
basi s.
Leaders who operat e i n t hi s mode
del iberat el y l eave cont ent mat t ers Book
t o group members whil e t hey f ocus Review
t hei r ener gy on bui l di ng ef f ect i ve
part nerships and net works. They also
f ocus on pr ovi di ng t he enabl i ng
st r uct ur es t hat suppor t super i or
per f or mance. Rat her t han comi ng
t o meet ings t o make decisions, t hese
l eader s pr ovi de deci si on- maki ng
st r uct ur es. Rat her t han deci di ng
st rat egy, ident if ying priorit ies, and
assigning responsibilit ies, t hey provide
t he r i ght st r uct ur i ng t ool s so t hat
members can creat e t hose pl ans f or
t hemselves. Rat her t han make t hings
happen, t hey enabl e ot hers t o get
t hi ngs done. They are hel pers and
enabl ers. Al t hough t his st yl e is not
appl icabl e t o al l sit uat ions, it is t he The ultimate goal of
r i ght appr oach f or gr oups whose the facilitative leader
members are capabl e of bot h making is to develop the
ef f ect i ve deci si ons and wor ki ng
leadership talents of
independent l y. Power is one of t he
others by instilling
cent ral dil emmas of t he f acil it at ive
confidence, authority,
l eader s because f aci l i t at i on i s
and responsibility in
i nt r i nsi cal l y a power l ess r ol e. The
sol ut ion t o t his power dil mna l ies in
each person.
knowing t he power equat ion
The amount of power you have =
t he amount of power you negot iat e
This equat ion means t hat leaders who
ar e oper at i ng i n a power vacuum
need t o be const ant l y ident if y t he
power required t o manage t he process
el ement s of t hei r assi gnment and
regul arl y (not j ust once) negot iat e
t o receive t his power.
The basic t hrust of t he book is backed
wit h a number of specif ic t ool s and
t echniques t hat a l eader can bring
t o bear upon i mpr ovi ng t hei r
f acil it at ion skil l s.
113
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
Book The book hi ghl i ght s t en essent i al
Review pr ocesses f or l eadi ng t hr ough
f acil it at ion:
z New leader int egr at ion: A
st ruct ured dial og bet ween t he
l eader and group members in
t he f i r st f ew days of t he
r el at i onshi p t o br eak down
barriers and accel erat e bonds.
z Visioning: Usi ng a shar ed
vi si oni ng pr ocess t o i dent i f y
common goal s t o whi ch al l
members aspire. Making people
see t heout comes f or which t hey
are worki ng
Evaluating the z Team launch: A set of
process elements of an conver sat i ons t o pr ovi de t he
initiative rather than members of t eam wit h cl ear
the tasks. It starts paramet ers and t he opport unit y
with an to devel op cooper t at i ve
identification of rel at ionships bef ore j umping in
i nt o t he t asks.
what’s working and
what’s not working to z Operational Review: Evaluat ing
ensure that blocks t he pr ocess el ement s of an
and barriers are init iat ive rat her t han t he t asks.
identified and It st art s wit h an ident if icat ion
removed. of what ’ s working and what ’ s
not working t o ensure t hat blocks
and barriers are ident if ied and
r emoved.
z Survey Feedback: Pr ocess of
generat ing dat a using survey
and t hen providing t hose dat a
t o st akeholders for int erpret at ion
and i dent i f i cat i on of act i on
pl ans.
z Af t er Act ion debr ief ing:
Assessment conduct ed af t er a
maj or pr oj ect or act i vi t y t o
114
det erming what happened and
why.
z Needs and offers negotiation:
const ruct ive dialog bet ween t wo
par t i es to r esol ve
misunderst andings and ident if iy
act ion st eps bot h can t ake t o
cr eat e ef f ect i ve wor ki ng
rel at ionships.
z Peer Feedback:Mechani sms
t hrough which members can give
and receive f eedback and a f orm
of int ervent ion when f eedback
is direct ed t o individual s who
ar e under per f or mi ng.
z Mediat ing int er per sonal
conflict :
z Coaching
The book det ail s out how and when
t o use t hese dif f erent processes so
t hat bot h t he t ask and rel at ionship
aspect s of group working are addressed
t hr ough st r uct ur ed pr ocesses.
Combi ned wi t h t he i nst r ument s
pr ovi ded f or measur i ng bot h
compet encies as a f acil it at or as wel l
as blockages wit hin t he organizat ion,
it is a good st art er f or t he aspiring
l eaders of t he 21st cent ury.
Reviewed by :
Sanj ay Dhar
Sr. Manager (Acad. ) & Sr. FM
MTI, SAIL, Ranchi.
Publisher :
Jossey Bass
Year of Publicat ion : 2006

usr`Ro ,d >yd ,oa ij[k
MkW0 jRus'k prqosZnhh*
fdlh Hkh O;kolkf;d laLFkku@vkS|ksfxd
laLFkku dh lQyrk ogk¡ miyC/k usr`Ro dh
xq.koÙkk ij fuHkZj djrh gSA bl dF; dh
iqf"V ds fy, ns'k ,oa fons'k esa dfri; mnkgj.k
miyC/k gSAa Hkkjr ds te'ksniqj esa VkVk vk;ju
LVhy daiuh fyfeVsM dh lQyrk dk Js;
mlds ltZd LoxhZ; te'ksnth uljoku th
VkVk dks tkrk gSA blh izdkj la;qDr jkT;
vesfjdk ds QksMZ eksVj daiuh dh lQyrk
dk Js; LoxhZ; gsujh QksMZ dks tkrk gSA ;fn
izkjafHkd pj.k esa bu laLFkkvksa dks bu egku
yksxksa dk usr`Ro u izkIr gqvk gksrk rks budh
orZeku dh fu[kjh gqbZ :ijs[kk ugha fn[kkbZ
iM+rhA fdlh O;kolkf;d laLFkk esa vusd
dk;Z ,oa midk;Z gksrs gSa tSls laLFkk ds mís';ksa
dk fu/kkZj.k rFkk mUgsa izkIr djus ds rjhdksa
dk fu/kkZj.k] laLFkk ds dfri; foHkkxksa dh
xfrfofèk;ksa dk funs'Z ku o leUo;u rFkk mudk
lQy lapkyuA bl gsrq ltx ,oa ;ksX;
usr`Ro dh vko';drk gksrh gSA blh ckr dh
vksj dfri; fo}kuksa us ladsr fd;k gS % ihVj
Mªdj ds 'kCnksa esa ^^usr`Ro euq"; dh nwjnf'kZrk
dks vkSj Å¡ps ifjn`";ksa rd mBkuk gS] euq";
○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○
*jhMj] tsfo;j lekt lsok laLFkku] jk¡ph
usr`Ro ,d >yd ,oa ij[k % prqosZnh
fgUnh ys[k
ds fu"iknu dks vkSj Å¡ps Lrj rd c<+kuk gS]
euq"; ds O;fDrRo dk fuekZ.k mldh lkekU;
lhekvksa ds ikj rd djuk gSA**1 tktZ vkj-
Vsjh us dgk gS % ^^dk;Z djus dh bPNk dks
us r ` R o }kjk iz s f jr fd;k tkrk gS rFkk
miyfCèk;ksa ds izfr mRlqd bPNkvksa dks vuqpjksa ds lewg ls] fcuk
lQyrkiwoZd iwjk djus dh izcy /kqu esa mRihM+u dk iz;ksx ds]
usr`Ro }kjk vuqdwy ifjorZu dj fn;k tkrk LosPN;k bfPNr dk;Z djk
ysus dh lqfuf'prrk dh
gSA2 vyQksMZ rFkk csêh dh n`f"V esa ^^vuqpjksa
;ksX;rk usr`Ro gSA
ds lewg ls] fcuk mRihM+u dk iz;ksx ds]
LosPN;k bfPNr dk;Z djk ysus dh lqfuf'prrk
dh ;ksX;rk usr`Ro gSA3 usr`Ro ds laca/k esa bUgha
ckrksa dks dhFk Msfol us cM+s Li"V 'kCnksa esa
dgk gSA muds vuqlkj ^^nwljksa dks fu/kkZfjr
mís';ksa dks mRlkgiwoZd izkIr djus gsrq le>k
ysus dh ;ksX;rk usr`Ro gSA ;g ekuoh; rRo gS
fd tks ,d lewg dks lkFk&lkFk cka/k dj
j[krk gS rFkk mís';ksa dh vksj bls izsfjr
djrk gSA4**
mijksDr dF;ksa ls ;g Li"V gksrk gS fd usrk
rFkk izca/kd esa varj gksrk gSA nksuksa fHkUu gSaA
mudh fHkUurk ij fopkj dj ysuk lehphu
gksxk %
○ ○ ○ ○ ○ ○ ○ ○
115
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
1- ,d O;fDr usrk ds :i esa mHkjrk gSA og
fgUnh ys[k usrk ds :i esa mHkj ik;sxk ;k ugha ;g
vusd ifjfLFkfrtU; rRoksa ij fuHkZj
djrk gSA fdUrq ,d izca/kd rks izca/kd
dh fLFkfr eas loZnk fu;qfDr vk/kkj ij
gh vkrk gSA
2- usrk ds ikl loZnk dqN vukSipkfjd
'kfDr;ka jgrh gS a A (mnkgj.kLo:i
izHkkfor djus dh {kerk) ftuls os usr`Ro
djus dk Lo:i iz k Ir djrk gS A
vkSipkfjd vf/kdkj mlds ikl gks ldrs
gSa vFkok ugha Hkh gks ldrs gSAa (mnkgj.kkFkZ
& iz'kklu dk vf/kdkj) tcfd ,d
izcaèkd loZnk dqN u dqN vkSipkfjd
vfèkdkj 'kfDr;ksa ls lEiUu jgrk gSA
laHko gS mldh viuh O;fDrxr 'kfDr;ksa
vuqpjksa dh deZBrk rFkk
esa xq.k leiUurk dk vHkko gksA ;fn og
usr`Ro ds izfr fu"Bk ,oa
O;fDrxr 'kfDr;ksa esa xq.k lEiUurk dk
mRlxZ dh Hkkouk dh ek=k
vHkko gksA ;fn og O;fDrxr 'kfDr;ksa
ls gh usrk esa usr`Ro dh
xq.koÙkk rFkk {kerk dk ls Hkh laEiUu gks rks fQj D;k dguk \
vkdyu dj ldrs gSaA 3- usrk vkSj vuqpjksa ds mí';ksa ,d:irk
gksrh gS fdUrq ,d izca/kd ds mís';ksa dks
vèkhuLFk deZpkjh viuk mís'; ugha
ekurs gSaA
vr% izca/kd ,oa usrk nksuksa fHkUu /kjkry ij
[kM+s jgrs gSaA usrk ekuork ijd ewY;ksa ds
vkèkkj ij y{;ksUeq[k gksrk gS tcfd izca/kd
mís';ijd ewY;ksa ds vk/kkj ij y{;ksUeq[k
gksrk gSA blfy;s vuqpj usrk dks viuk ekurs
gSa] mlds izfr fu"Bkoku jgrs gq, mRlxZ ds
fy;s Hkh rRij jgrs gSa tcfd izca/kd dks
^vius mij* ekurs gSa vkSj mldh ckrksa dks
ekurs gSa blfy;s fd fodYi ugha gksrkA
vc le; vk x;k gS usr`Ro ds y{k.kksa ij
fopkj djus dkA dfri; izeq[k y{k.k vxz
116
izdkj gSa %&
1- usrR` o dh dYiuk esa vuq;kb;ksa ds vfLrRo
dh Lohdkjk tkrk gS vFkkZr~ usrk gS rks
vuq;kbZ gksaxs vFkok vuq;k;h gSa rks usrk
vo'; gksxkA vuqpjksa dh deZBrk rFkk
usr`Ro ds izfr fu"Bk ,oa mRlxZ dh Hkkouk
dh ek=k ls gh usrk esa usr`Ro dh xq.koÙkk
rFkk {kerk dk vkdyu dj ldrs gSaA
,d cgqLrjh; vkSipkfjd laxBu esa
fdlh Hkh Lrj ds usrk dks vius Lrj ds
yksxksa dk usr`Ro djuk iM+rk gS lkFk gh
vius ls mij ds Lrj ds vf/kdkjh dh
ckrsa lquuh Hkh iM+rh gS ,oa ekuuh iM+rh
gSA usr`Ro dh lQyrk ftruh vius
vuqpjksa }kjk izlUurkiwoZd viuh ckr
euokus esa gS mruh gh vius mij ds
yksxksa dh ckr izlUurkiwoZd ekuus esa gSA
vr% usrk ds eu esa g"kZ ,oa mYykl dk
Lo:i nksuksa le; esa gksuk pkfg,A
2- usrk vkSj vuqpjksa ds fgrksa esa ,d:irk
dk fo|eku jguk usr`Ro dh vis{kk gksrh
gSA nwljs 'kCnksa esa usrk vkSj vuqpjksa ds
fgrksa esa iw.kZr;k ,d:irk gksuh pkfg,A
;fn ,slk ugha gqvk rks usr`Ro dk vHkko
ekuk tk;sxkA ^^vkilh mís'; gsrq LosPN;k
iz;kl djus gsrq yksxksa dks (vuqpjksa dks)
izHkkfor djus dh xfrfofèk gh usr`Ro
gSA** 5
3- usr`Ro esa usrk rFkk lewg ds lnL;ksa esa
vf/kdkj dk vleku forj.k fufgr gksrk
gSA lewg ds lnL;ksa dks usrk dh ckrsa
lquuh vkSj ekuuh iM+rh gS fdUrq lewg
dk dksbZ lnL; usrk dks vkns'k funsZ'k
ugha ns ldrk gS] ;|fi os lkjs yksx mu
xfrfof/k;ksa dks vusd izdkj ls izHkkfor
dj ldrs gSaA

4- usr`Ro esa usrk }kjk vius v/khuLFk ,oa
vuq;kb;ksa dks vkns'k funsZ'k nsus ds
vykok vius O;ogkj ,oa vkpj.k ds
}kjk Hkh mUgsa izHkkfor fd;k tkuk fufgr
gksrk gSA
5- vuqpjksa ,oa muls lEcfU/kr ifjfLFkfr;ksa
ls lacaf/kr ekeyksa esa rF;ijd ,oa
viwokZxgz h O;ogkj ^usr`Ro dh iwoZ dYiuk
gksrh gSA
6- vuqpjksa vFkok vuq;kbZ;ksa dks dksbZ Hkh
funsZ'k nsus ds igys mldh mikns;rk ds
ckjs esa usrk }kjk Lo;a vk'oLr gks tkuk
^usr`Ro* dh vko';drk gSA
usr`Ro ds dk;Z %
;fn de 'kCnksa esa usr`Ro ds dk;ks± dks crkuk gks
rks dgk tk ldrk gS fd usr`Ro Lo;a vius
dk;ks± dk :i rFkk muds fØ;kUo;u dk <ax
fu/kkZfjr djrk gSA fQj Hkh usr`Ro ds izeq[k
dk;ks± dh ppkZ vkxs dh tk jgh gSA Øsp ,oa
ØpQhYM6 tSls fpardksa us usrk }kjk laikfnr
fd;s tkus okys 14 dk;ks± dks oxhZdj.k fd;k
gS tks fuEu rhu oxks± eas crk;s x;s gSa %
1- laxBukRed y{;ksa dk fu/kkZj.k ,oa
mudh izkfIr %
bl lanHkZ eas usrk fuEu rhu Hkwfedkvksa esa
vkrk gS %
(v) y{; fu/kkZjd %& usrk ;k rks Lo;a laxBu
ds y{;ksa dks fu/kkZfjr djs vFkok vius ojh;
rFkk led{k yksxksa ds lkFk fopkj foe'kZ dj
r; djs vFkok mudks Hkh fo'okl eas ysus gsrq
muls Hkh fopkj foe'kZ djs] ftuls dk;Z djkuk
gSA pkgs tks Hkh fLFkfr gks y{; fuèkkZj.k esa
usrk dh egrh Hkwfedk gksrh gSA blfy;s fdlh
Hkh dEiuh dk v/;{k (izflMsVa ) lapkyd eaMy
usr`Ro ,d >yd ,oa ij[k % prqosZnh
ds lkFk vFkok vius v/khuLFk deZpkfj;ksa ds
lkFk fopkj foe'kZ ds ckn dEiuh ds mRikn fgUnh ys[k
oLrq vFkok lsok ds LoHkko] ek=k] xq.koÙkk
vkfn ds laca/k esa y{; fu/kkZj.k djrk gSA
(c) vk;ks t d %& y{;ksa ds fu/kkZj.k ds
mijkUr fdUrq mudh izkfIr gsrq fØ;kUo;u ds
chp usrk dh Hkwfedk vk;kstd ds :i esa
curh gSA /;krO; gS fd lQy vk;kstu gh
lQy fØ;kUo;u dk vk/kkj gksrk gSA bl
Hkwfedk esa usrk vkxs ds dk;ks± dks ljy lqxe
fu;af=r ,oa pj.kc¼ <ax ls iwjk djus dh
;kstuk cukrk gS ;k cukus esa lgk;d gksrk gSA
(l) O;oLFkkid rFkk iz'kkld % fu/kkZfjr
y{;ksa dh vksj iwoZ fu;ksftr <ax ls dk;ZdrkZvksa
dk ny dk;Zjr gS vkSj dk;Z eas fdlh izdkj
fo{ksi ugha gks jgk gS & ;g ns[kuk gh O;oLFkkid
rFkk iz'kkld dk dk;Z gS vkSj usrk dh ;g
usr`Ro Lo;a vius dk;ks± dk
Hkwfedk Hkh egrh Hkwfedk gksrh gSA :i rFkk muds fØ;kUo;u
2- laxBu dh fØ;kvkas ,oa izfØ;kvksa dk dk <ax fu/kkZfjr djrk gSA
vk;kstu % usrk }kjk fd;s tkus okys nwljs
oxZ ds dk;Z laxBu dh fØ;kvksa ,oa izfØ;kvksa
ds vk;kstu ls lacaf/kr gksrs gSaA usrk }kjk
fd;s tkus okys N% rjg ds dk;Z bl oxZ esa
vkrs gSa %
( i) fl¼gLr dh Hkwfedk %& usrk laxBu
dh izeq[k xfrfof/k;ksa dk fl¼gLr gksrk gSA
mls vius v/khuLFkksa dks le;&le; ij
dfBukbZ gksus ij lykg nsus dh vko';drk
iM+rh gS ,oa dHkh&dHkh fu:fir vFkok iznf'kZr
djus dh Hkh vko';drk iM+rh gSA
( ii) cká i{kks a ds lEeq [ k lew g dk
izfrfufèkRo %& cgq/kk cká i{kksa ls laxBu
dks O;ogkj djuk iM+rk gSA ,sls le; esa
laxBu dk izfrfuf/kRo lewg ds ek/;e ls
117
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
izHkkoh <ax ls ugha gks ikrk gS vkSj ;gha ij usrk
fgUnh ys[k dh mÙkjnkf;Roiw.kZ Hkwfedk gks tkrh gSA QeZ
dk fgr] deZpkfj;ksa dk fgr] lekt fgr]
jk"Vªfgr vkSj lkeus okys ds fy;s O;ogkj gsrq
i;kZIr vkd"kZ.k & ;g lkjs nkf;Ro ,d lkFk
usrk ds lj ij vk tkrs gSaA
( iii) O ; f D r x r m Ù k j n k f ; R o g s r q
izfrfu;qfDr %& cgq/kk lewg esa ls gh dksbZ
O;fDr vU; dksbZ lg;ksfx;ksa dh vksj ls mudk
iz f rfuf/kRo djus ds fy, muds }kjk
izfrfu;qDr dj fn;k tkrk gSA ,sls esa usrk dh
nkf;Ro Hkjh Hkwfedk vk tkrh gS D;ksafd mls
lg;ksfx;ksa ds fgr vkSj fo'okl dh j{kk djrs
jguk gksxk D;ksafd blh dkj.k fo'okl dh
j{kk djrs jgus gksxk D;ksafd blh dkj.k rks
laxBu esa ,d usrk
lg;ksxh usrk ds fu.kZ; esa fo'okl djrs gSaA
(izcaèkd) ds usr`Ro ,oa
fu;a=.k esa iM+us okys lHkh (iv) laxBu ds varxZr vkUrfjd lEcUèkksa
foHkkx vius dk;Z&dykiksa dk fu;a=d %& laxBu esa ,d usrk (izcaèkd)
dks vf/kdkf/kd ek=k esa ds usr`Ro ,oa fu;a=.k esa iM+us okys lHkh foHkkx
lefUor djrs jgsa] bls vius dk;Z&dykiksa dks vf/kdkf/kd ek=k esa
lqfuf'pr djkus dh lefUor djrs jgsa] bls lqfuf'pr djkus dh
Hkwfedk usrk (izca/kd) dh gh Hkwfedk usrk (izca/kd) dh gh gksrh gSA
gksrh gSA
(v) ikfjrksf"kd ,oa n.Mksa dk iz'kkld %&
fujh{kd ds :i esa vius v/khuLFk deZpkfj;ksa
esa ls lqik= (;ksX;) yksxksa dks mRlkfgr djus
gsrq izksUufr nsus rFkk v;ksX; yksxksa ds fy;s
n.M] LFkkukUrj.k vkfn dh O;oLFkk djus
dh nkf;Ro Hkjh Hkwfedk Hkh usrk dh gh gksrh
gSA vukSipkfjd lewg esa Hkh vuq'kklu cuk
jgs ;g mÙkjnkf;Ro Hkh usrk dk gh gksrk gSA
,sls lewg dk usrk vius lewg esa fdlh O;fDr
}kjk vlaxr O;ogkj djus ij mls lewg dh
lnL;rk ls cfg"d`r djus dh Hkh lksp ldrk
gSA
(vi) iap ,oa e/;LFk %& v/khuLFkksa ds chp
118
rkjrE; cuk jgs bls ns[krs jgus dh rFkk
cuk;s j[kus dh mÙkjnkf;Roiw.kZ Hkwfedk Hkh
usrk dh gh gksrh gSA blhfy;s v/;{k vius
v/khuLFk egRokdka{kh rFkk vkilh izfr}fU}rk
ds vk/kkj ij dke djus okys mik/;{kksa ds
chp tc vLoLFk izfr}fU}rk ns[krk gS rks
mUgsa cSBkdj] le>k cq>kdj vFkok vU;
rjhdksa ls muds chp ds Hkko dks cny rkjrE;
cSBk;s j[kus dk iz;Ru djrk gSA
3- lewg dk J¼s; izrhd %& bl :i esa
usrk dh Hkwfedk bruh lw{e gksrh gS fd
dHkh&dHkh bl ij /;ku gh ugha tkrk fdUrq
;gk¡ Hkh usrk egrh Hkwfedk esa jgrk gSA bl
Hkwfedk esa mlds dk;Z vxz izdkj gSa %&
( i) vuqdj.kh; Hkwfedk esa %& v/khuLFkksa
ds lEeq[k usrk dh vuqdj.kh; cus jgus dh
Hkwfedk gksrh gSA fu/kkZfjr le; ls iwoZ gh
dk;kZy; esa vius LFkku ij igqp¡ us okyk O;fDr
dh vius v/khuLFkksa dks le; ij igq¡pus dh
ckr dg ldrk gSA lSfudksa ds lkFk&lkFk
tc mudk uk;d Hkh ;q¼{ks= esa mifLFkr
jgrk gS rks mudk eukscy Å¡pk jgrk gSA
vr% dgk tk ldrk gS fd usrk dk dk;Z
vèkhuLFkksa ds lEeq[k vuqdj.kh; cus jgus
dk gSA
( ii) lewg dk izrhd %& usrk Hkh lewg dks
,d LFkk;h igpku nsrk gS vkSj mldh fLFkfr
ls laLFkk esa ,d fujarjrk dk cks/k gksrk jgrk
gSA blhfy;s fdlh daiuh ds lapkyd eaMy
dk v/;{k vYi fu;a=.k djrs gq, Hkh
va'kèkkfj;ksa] deZpkfj;ksa rFkk turk ds chp
daiuh dk thoar izrhd Lo:i cuk jgrk gSA
( iii) vkn'kZoknh %& usrk dk Lo:i vius
vèkhuLFk@vuq;k;h yksxksa ds lUeq[k vkn'kZoknh
gh jguk pkfg,A mls bl dlkSVh ij yxHkx

[kjk mrjuk pkfg;s rHkh og mu yksxksa dk
fo'okl thr ldsxkA cgq/kk ,slk ns[kk tkrk
gS fd vukSipkfjd lewg ds izoDrk }kjk dgh
x;h ckrsa lewg ds yksxksa dk earO; ugha gksrh
gSA
( iv) fir` L o:i %& usrk dk Lo:i vkSj
LoHkko ,slk izrhr gksuk pkfg, fd vèkhuLFkks@a
vuq;kb;ksa dks loZnk ;g vuqHkwfr gksrh jgs fd
gekjs usrk gekjs nq[k&nnZ dk lkFkh gS] gekjk
'kqHkfpard gS] gekjk vfHkHkkod gSA mldk
O;ogkj ,slk gksuk pkfg, ftlls fd viuh
O;fDrxr leL;kvksa dk Hkh lek/kku vèkhuLFk
@vuq;k;h O;fDr laosnkRed vk/kkj ij ik
ldsA
usr`Ro dh Hkwfedk ij fopkj ds ckn ;g Lor%
Li"V gks tkrk gS fd lewg esa rkjrE; cuk;s
j[krs gq, mís';ksa ds izfr lrr lps"Vrk ds
lkFk iz;kljr jgus dk cks/k usrk djkrk gSA
bl Hkwfedk esa mldh dgha ls Hkh FkksM+h lh Hkh
pwd gksrh gS rks laxBu dks fdlh u fdlh :i
esa izfrdwy ifj.kke >syuk iM+rk gSA
vr,o ;g usr`Ro gh gksrk gS tks laxBu dks
lQy cukus dk Js; dk Hkkxh gksrk gS vFkok
mls vlQy cukdj dyad dk Hkkxh gksrk
gSA
uk;d ds usr`Ro ds dqN xq.k 'kk'or gksrs gSa
vkSj mu xq.kksa dks vius O;fDrRo esa cuk;s
j[kus ds fy;s mls lrr~ lps"V jguk pkfg,A
blds lkFk gh mlds xq.kksa dh >ksyh esa dqN
xq.k dkyØe esa ifjorZu rFkk ifjfLFkfr;ksa esa
ifjorZu ds lkFk vk tkus pkfg;sA ,slk u gksus
ij usr`Ro dh Hkwfedk dk fuokZg lQy <ax ls
ugaha gks ldsxkA
fiNyh dqN 'krkfCn;ksa esa fodkl dh nj esa
ifjorZu vk;k gSA ;g nj 20oha 'krkCnh ds
usr`Ro ,d >yd ,oa ij[k % prqosZnh
iwokZ¼Z esa dqN vkSj xfr idM+hA ;|fi bl
dky esa fo'o ds Hk;kud ;q¼ (izFke rFkk fgUnh ys[k
f}rh; fo'o;q¼) Hkh gq,A fouk'k dh HkjikbZ
djus ds fy;s fo'o ds le{k ns ' kks a us
vius&vius <ax ls dke djuk Hkh izkjaHk
fd;k vkSj lQyrk ikbZA mifuos'kokn Øe'k%
lekIr gksrk x;k vkSj xqyke ns'k Lora= gksrs
x;sA jktuhfrd O;oLFkk vkSj rnuq:i
vkfFkZd O;oLFkk esa ifjorZu gksrk jgkA iwt
a hokn
vkSj lkE;okn dk :i fo'o ds lkeus vk;kA
fo'o nks [kses esa caV x;kA vius&vius <ax ls
O;oLFkk pykbZ tkus yxh vkSj fodkl Hkh
izkIr fd;k tkus yxkA dqN Lora= gksus okys
ns'kksa us (Hkkjr ,oa mlds fe= ,oa vxqokbZ ns'kksa
us) xqVfujis{krk dh uhfr viuk;hA vkfFkZd lewg esa rkjrE; cuk;s
fodkl gsrq vkS|ksfxd] O;olkf;d] oSKkfud j[krs gq, mís';ksa ds izfr
,oa lkekftd fodkl ij cy fn;k tkus lrr lps"Vrk ds lkFk
yxkA ekuo ewY;ksa dks /;ku esa j[kdj fo'o iz;kljr jgus dk cks/k usrk
ds ns'kksa esa fHkUu&fHkUu dkuwu Hkh cuk;s x;sA djkrk gSA bl Hkwfedk esa
mldh dgha ls Hkh FkksM+h lh
ftlls vkS|ksfxd ,oa O;kolkf;d fodkl dh
Hkh pwd gksrh gS rks laxBu
xfr mÙkjksÙkj rst gksrh tk;sA Hkkjr esa Hkh
dks fdlh u fdlh :i esa
foèkkf;dk us ,slk fd;kA fnXn'kZu gsrq dqN izfrdwy ifj.kke >syuk
fuEufyf[kr gSa % iM+rk gSA
deZpkjh {kfriwfrZ vf/kfu;e 1923
VªsM ;wfu;u vf/kfu;e 1926
etnwjh Hkqxrku vf/kfu;e 1936
vkS|ksfxd jkstxkj (LFkk;h vkns'k)
vf/kfu;e 1946
vkS|ksfxd fookn vf/kfu;e 1947
U;wure etnwjh vf/kfu;e 1948
dkj[kkuk vf/kfu;e 1948
deZpkjh jkT; chek vf/kfu;e 1948
deZpkjh Hkfo"; fuf/k rFkk
fofo/k O;oLFkk vf/kfu;e 1952
bEIyk;esUV ,Dlpsat
119
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
(dEiyljh uksfVfQds'ku
fgUnh ys[k vkWQ HksdUs lht) ,DV 1959
vkijsfUVl ,DV 1961
cksul Hkqxrku vf/kfu;e 1965
dkUVªSDV yscj (jsxqys'ku ,oa
,okfy'ku) ,sDV 1970
xzsP;qVh Hkqxrku vf/kfu;e 1972
bDoy jsequjs'ku ,DV 1976
fdUrq 20oha 'krkCnh ds mÙkjk¼Z esa rks prqfnZd
fodkl dh ;g nj vkSj c<+rh xbZA O;kikj]
O;olk; ,oa m|ksx Øe'k% pqukSrh Hkjs gksus
yxsA izfr;ksfxrk dk Lo:i] vkokxeu rFkk
;krk;kr ds lk/kuksa esa fodkl ds lkFk cny
x;kA Je vf/kd xfr'khy gks x;kA iw¡th dh
xfr'khyrk esa Hkh o`f¼ gksxh x;hA iw¡th vkiwfrZ
ds lzksr vkSj lk/kuksa esa ifjorZu gks x;kA Je
usrk m|ksx dk gks] laxBu
dk gks vFkok laxBu ds ,oa iwath nksuksa jktuhfrd lhekvksa dks ikj
lewg fo'ks"k dk gks] mlds djrs gq, vf/kd xfr'khy gks x,A Jfed
lUeq[k pqukSrh ;fn leku vkSj vf/kdkjksa ds izfr lps"V gksrs x,A
ugha gS rks le:ih vo'; miHkksDrkvksa ds Kku ,oa :fp esa ifjorZu
gks xbZ gSA gksrk x;kA mnkjhdj.k ,oa oS'ohdj.k dk
dky vk x;k vkSj vc O;olk; ,oa m|ksx
vfr'k; pqukSrh Hkjk gks x;kA u;s&u;s izfr;ksxh
(ns'kh gh ugha fons'kh Hkh) vf/kdkf/kd lkeF;Z]
mRikn dh xq.koÙkk ,oa ferO;kf;rk ds lkFk
vk x;sA lwpuk rduhd esa vkbZ gqbZ Økafr us
rks vkSj rgydk epk fn;kA nqfu;k dk Lo:i
gh vc NksVk gks x;kA ltx miHkksDrkvksa dks
fo'o ds ?kVukØe o mRikn ds ewY; vkSj
xq.koÙkk dh tkudkjh fey tkrh gS vkSj ftUgsa
ugha fey ikrh gS mUgsa izcy ,oa xgu foKkiu
}kjk ns nh tkrh gSA izfr;ksfxrk us viuk izcy
:i ys j[kk gSA bruk gh ugha fodkl dh bl
xfr esa ekuo ewY;ksa ds voewY;u eas Hkh mÙkjksÙkj
fodkl gh gksrk jgk gSA
120
,sls esa ,d O;olkf;d vFkok vkS|ksfxd laLFkk
esa usr`Ro ds vfLrRo ds lEuq[k dM+h pqukSrh
vk iM+h gSA
usrk m|ksx dk gks] laxBu dk gks vFkok laxBu
ds lewg fo'ks"k dk gks] mlds lUeq[k pqukSrh
;fn leku ugha gS rks le:ih vo'; gks xbZ
gSA mldh KkusfUæ;k¡ (vk¡[k] dku] ukd vkfn)
rks igys Hkh dke djrh Fkha vkSj cqf¼ rFkk
foosd ds lgkjs og usr`Ro dj fy;k djrk
Fkk] fdUrq vkt ds ifjiz{s ; esa] vkus okys
fnuksa esa mldh lrdZrk gh mls lQyrk fnyk
ik;s x hA mls vius Kku ds Hk.Mkj ea s
vfèkdkfèkd o`f¼ djuh gksxhA rhozxfr ls
cnyrs voewY;u ds ifjos'k esa ekuo ewY;ksa ds
izfr vf/kdkf/kd lrdZ jguk gksxkA ,slk gksus
ij gh dy dk O;olkf;d usrk viuh usr`Ro
dh Hkwfedk esa lQy gks ldsxkA
vr,o fu"d"kZ Lo:i vkus okys fnuksa esa ,d
vkS|ksfxd@O;olkf;d laxBu esa dke djus
okys usrk dh lQy Hkwfedk gsrq ftu xq.kksa dh
vko';drk gksxh muesa ls dqN bl izdkj gSa%
1- 'kkjhfjd Lo:i %
(i ) LoLFk 'kjhj
(ii) dk;Z{ks= ds vuq:i cy] f'k{kk ,oa
nh{kk
(iii) larqfyr vkgkj fogkj
(iv) fu;fer ,oa fu;af=r vkpj.k
2- vknrsa %
(i ) dk;Z ds izfr fu"Bk ,oa dk;Z djus
esa fu;ferrk
(ii) ;FkklaHko lR; dFku
(iii) dgh xbZ rFkk lquh xbZ ckrksa dk
vf/kdkf/kd Lej.k
(iv) le;c¼rk
 usr`Ro ,d >yd ,oa ij[k % prqosZnh

(v) vPNk Jksrk ,oa oDrk tkudkjh

3- LoHkko %
(i ) mnkj fdarq n`<+] g¡leq[k ,oa mRlkgh
(ii ) vØks/kh rFkk {kek'khy
(iii) LokfHkekuh fdarq vga'kwU;
(iv) ;FkklEHko len'khZ vFkkZr~ i{kikr
jfgr
(v) vf/kdkf/kd Kku vtZu ds izfr
lrr iz;Ru'khy %
& vius laxBu ds mRikn ds ckjs esa
& vius laxBu ds mRiknu i¼fr ds
ckjs esa (;FkklaHko)
& mRikn ds cktkj dh tkudkjh rFkk
mRikn ds miHkksDrkvksa dh :fp
dh tkudkjh ,oa :fp ifjorZu
dh tkudkjh cktkj ds Hkkoh Lo:i
dh tkudkjh
& dPps eky ds lUnHkZ esa ;FkklaHko
tkudkjh
& miyC/k ;krk;kr lk/kuksa ds ckjs
esa ;FkklaHko tkudkjh
& deZpkfj;ksa ls lacaf/kr dkuwuksa dh
;FkklaHko tkudkjhA
& O;kikj txr dks izHkkfor djus okys
vU; dkuw u ks a dh ;FkklEHko
& vius laxBu esa ikfjJfed <+kaps fgUnh ys[k
dh rFkk vU; leku m|ksxksa ds
etnw j h <+ k a p s dh ;Fkkla H ko
tkudkjh
& O;kikj txr~ dks izHkkfor djus okys
vU; dkuw u ks a dh ;FkklEHko
tkudkjh
& vius v/khuLFk deZpkfj;ksa dh
O;fDrxr ,oa ikfjokfjd fLFkfr dh
;FkklaHko tkudkjhA
Lej.k jgs mij crk;h xbZ lkjs ckrsa fnXn'kZukFkZ
gh gSaA lQy usr`Ro gsrq vko';d ckrksa dk
;gh iw.kZ fojke ugha gSA mijksDr lkjh ckrksa ds
lkFk foosd iz/kku gksdj gh fy;k x;k fu.kZ;]
usr`Ro ds lanHkZ esa] ;fn loZekU; u Hkh gks rks
Hkh cgqekU; rks gksxk ghA foosd iz/kku gksdj gh fy;k
vr% var esa laf{kfIrdj.k ds Øe esa xksLokeh x;k fu.kZ;] usr`Ro ds lanHkZ
esa] ;fn loZekU; u Hkh gks
rqylhnkl dh bu iafDr;ksa dks usr`Ro ds lanHkZ
rks Hkh cgqekU; rks gksxk ghA
eas mn~/k`r fd;k tk ldrk gS %
^^eqf[k;k eq[kqlks pkfg,] [kku&iku dgq¡ ,d]
ikyb iks"kb ldy vax] rqylh lfgr foosdA**
Jhjkepfjr ekul&v;ks/;kdkaM nksgk 315

1 ihVj Mªdj] izSfDVl vkWQ eSustesaV (,yk;M ifCy'klZ izkbosV fyfeVsM] ubZ fnYyh) 1970] i`0 159
2 tkWtZ vkj- Vsjh] fizalfiYl vkWQ eSustesaV] jhpkMZ Mh- bjfou ] bfyukW;l (;w,l,) 1960] i`0 442
3 ,y0 ih0 vyQksMZ ,.M ,p0 vkj0 csêh] fizfs liYl vkWQ bUMLVªh;y eSut s esaV] jksukYM izl
s ] U;w;kdZ]
1951] i`0 111
4 dhFk Msfol] áesu chgsfo;j ,V odZ] eSdxzkW fgy] U;w;kdZ] 1967] i`0 96
5 bchM
6 Mh0 Øsp ,.M vkj0 ,l0 ØpfQYM % fFk;ksjh ,.M izkCs yEl vkWQ lks'ky lkbDyksth] eSdxzkW fgy]
U;w;kdZ] 1948

121
 GROWTH, VOLUME 35, NO. 1, APRIL - JUNE, 2007
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 LEADERSHIP - A SELECT BIBLIOGRAPHY : BANERJEE
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