The Hindu Business Line : Changed circumstances need new attitudes

The first part of this article published last week examined how globalisation, IT and consumer evolution are at the core of the challenges that confront Indian companies today. These challenges include the challenge of growth, the challenge of costs, the challenge of customer and the challenge of quality. In the concluding part of the article, the writer touches on some of the other challenges that confront both Indian companies and new age managers in the country, and also looks at how organisations are dealing with these challenges.

Challenge of talent

The earlier sources of value creation such as technology, capital, products and advertising are gradually losing their power to differentiate and confer a competitive advantage on companies. Today, human capital has virtually become the last unexploited source of competitive advantage for organisations. Companies routinely proclaim that people are their most important asset. The challenge, however, lies in companies' ability to convert this thought into action. This starts with the quality of recruitment and performance management programmes. Winning companies treat talent enrolment as `brain-count' rather than as mere `head-count'. They not only attract the best talent, but also create effective systems of coaching, mentoring, empowerment and feedback to accelerate the readiness of employees to take on the challenges of a fast changing business environment. They take accountability for people development. Such organisations outsource non-core activities and focus their internal talent on strengthening the organisation's core competencies. They patiently build high-performing cross-functional teams. Most importantly, such winning organisations are characterised by an innate ability to emotionally engage and integrate their people and create a sense of belonging in the organisation. Developing a strong and sustainable human talent strategy is a major challenge for most companies today.

Challenge of leadership

As we move from a protected economy to a liberated one , the biggest challenge for Indian companies is the challenge of leadership. It's often said that the bottleneck is always at the top of the bottle. Our leadership attitudes have been steeped in the `command and control' style. Our strong traditional hierarchical values and a great social emphasis on obedience and conformance complicate the issue further and lend credibility to the command and control style of leadership. Winning companies, however, encourage a leadership culture based on an `envision, enable, energise' style. Such a style calls for a hands-on leadership approach where a leader sees himself as a first among equals and is willing to share the limelight with his people. Demonstrated levels of intuition and courage and an ability to think big and create mindset change characterise such a leadership style. These leaders are highly value based and legitimise their leadership by demonstrating strong value-based behaviour. With global expectations on the rise, there is no option for most primitive leadership style companies other than to change their leadership styles dramatically.

Organisational response to challenges

Organisations are rethinking, re-examining and reinventing their business theories and are creating new mindsets to meet the new challenges.

1. They have stopped looking at the mirror and have started looking out through the window. After years spent looking at the mirror to get a view of their own internal organisation, these companies have started peeping out of the window at the consumer, the customer and the competition. The resulting paradigm shift has created new insights and new business ideas and has opened their minds to look at businesses from a different perspective. This has helped companies to stop viewing the future as an extension of the past and start reinventing the future.

2. They have changed their internal environment to cope better with the external environment. Such organisations have started focusing and reorganising themselves around processes rather than functions. This enables them to utilise their special talents and skills more optimally. In fact, they are discovering the merits of redesigning their organisations to be more fluid and flexible to cope with newer challenges. Situational leadership is very much the watchword in such organisations. These organisations recognise that their strength lies in change, not stability.

3.Most important, companies are discovering the value of the human asset. There is a greater sense of entrepreneurship in such organisations, which take extraordinary care to select and implement the right performance development programmes. The key characteristic of such organisations is that both owners and employees take risks and prosper as partners in prosperity. Sharing prosperity with valued employees is seen as a sure way of driving ownership, commitment and high performance levels in people. Changed circumstances require changed attitudes. Winning organisations in the new century will recognise this truth and adapt themselves to face the emerging challenges confidently and with a will to win.

(The writer is Executive Director and Chief Executive Officer, CavinKare Pvt Ltd.)