The Hindu Business Line : Keeping track

Nothing is more vital for the successful running of an enterprise than keeping abreast of developments on the part of the person in overall charge of it. Systems and practices are supposed to be in place in every organisation to keep those in leadership positions posted with what is happening on their watch by means of periodical reports.

Situation Report

For instance, the top decision-makers should ideally have on their tables every morning, as they arrive, statements giving details of the operations and activities of the previous day, problems encountered and their current status. This is called SitRep (situation report) in armed forces parlance. The idea is to enable the top brass to detect storm signals and set afoot remedial measures. Where and when necessary, the No.1 himself should not hesitate to take preemptive action to ensure that any default or omission does not assume crisis proportions. This is especially important for manufacturing enterprises, sales and marketing organisations and financial and investment institutions.

In addition to daily SitReps, the various divisions of the organisation are required to circulate to the senior levels monthly and quarterly reports giving a detailed account of their working along with a digest of the major decisions taken, the negotiations under way, the fulfilment of targets set and plans in the offing. These reports should not be reduced to a ritual. The recipients should go through them minutely to give appropriate directions for setting things right. Otherwise, the inevitable consequence will be catastrophes akin to the Barrings Bank collapse, Sumitomo scandal, or the subprime disaster.

There is a variety of other means that can help senior executives keep tabs on the goings-on within the setups under their charge. Robert McNamara, as the President, Ford Motors, US Defence Secretary and President World Bank, followed the custom of sending out, as soon as he took charge, a questionnaire to all the managerial staff asking them to let him know candidly what, in their opinion, was going right or wrong, and how to tone up the performance. The feedback gave him an insight into the strengths and weaknesses of the organisations he headed. The former Chief Vigilance Commissioner, Mr N. Vittal, who was also Secretary, Ministry of Telecommunications, and Chairman of the Telecom Commission, commends this technique as contributing to effective leadership. Those running organisations can get enough clues on the shape of things to come by keeping an open door for associates of all levels as well as union representatives, and encouraging them to share their perceptions on small, middling and big issues of concern to them. Frequent exchange of views on ticklish matters by itself often leads to a forged convergence on the right methods of handling them. Executives can benefit from similar exchanges with visitors calling on them.

Friends of the chairman

The top echelons should set apart a designated day and time for monitoring and review meetings and stick to the schedule except when being absent on travel or attending to unavoidable assignments. Actually, I have found it useful in my experience to constitute a managing committee or a group of what I called Friends of the Chairman comprising divisional heads, union leaders, contractors’ representatives and independent experts invited from outside. The sense of enthusiastic participation thus evoked was of unfailing assistance in solving problems as they arose with the full cooperation of both executives responsible for implementation and the workforce on the shop floor. The higher one is on the ladder, the more watchful should he be if he wishes to avert a fall.

B. S. RAGHAVAN