The Hindu Business Line : Rules with a bit of sense

I recently visited my brother in Chennai. We decided to call on an ailing relative and walked down to the nearest autorickshaw stand. We were lucky to get a new auto and I noticed a spanking new electronic fare meter in place, wrapped up in the usual plastic dust cover; it was switched off though. I asked the auto driver why he needed to invest in an electronic fare meter in Chennai, where such a device is never used! Would the older, mechanical meter not have sufficed to keep up the pretence that fares are metered there? He told us that whenever autorickshaws need to get their licence renewed, the rule is that they must have an electronic meter fitted, though it is obvious to all that it would never be used. Insane rules!

The next image that my mind's eye evokes goes back 30 years to a curious Government rule concerning an important perquisite for its employees - the Leave Travel Allowance (LTA). As I recall, the Government had a rule that stated that the LTA rules would not cover any travel to a person's home town which was less than 150 miles from the place of work. Employees were also required to state their home towns to claim their entitlement.

The joke went that the number of people claiming Kashmir or Kanyakumari as their home towns was many times the actual population of these places! I guess there must have been some obscure reason why the 150-miles LTA rule was formulated.

I am sure that this rule must have been the profound work of some bureaucrat whose reasoning is unfortunately lost in the mists of time.

Rules and processes

We just need to look at the many rules and processes that govern our corporate environs to see how real the above scenarios are. The systems and processes that we are required to abide by are formulated at a given time, at a particular stage in the company's growth cycle.

Most times, they do not get modified as the system evolves and matures. The growth imperative for companies is very high these days and this may invariably involve growth in multiple geographies and business areas. Matters get even more complex when companies take both the organic and inorganic routes to growth.

Constant review and realignment of rules and regulations is required to ensure that the special needs of the businesses and geographies are addressed even as equity is maintained across the system as a whole.

This calls for a special focus at the highest levels of management on an ongoing basis. This has to be done regularly, in a transparent manner and communicated effectively.

A lag effect between growth in the system and harmonisation of the rules and processes will lead to internal disconnects and a consequent loss of focus on the needs of the business.

Many a time, this will lead to the creation of ossified, pocket Hitlers for whom abiding by archaic rules is more important than achieving business results.

Equally serious, empowerment will be at risk and the system will slow down. This will invariably lead to employees looking at shortcuts to get things done.

A more insidious consequence is the way that most employees who are normally law abiding will be tempted to either bypass the rules or seek to leave the company as they are unable to get things done properly. In essence, the rule of law will be undermined progressively, leading to a weakening of the steel framework that holds a company together.

A conscious and regular attempt to monitor and review the rules, systems and processes will have to be undertaken and this needs to be an activity which the senior management team owns and drives relentlessly. Not doing this is akin to insisting on wearing clothes that we have outgrown, a sure way to invite ridicule.

The law may be an ass according to some people, but there is no reason to perpetuate this aphorism in the companies we work for. May sanity rule.

(The writer is advisor to the Manipal Education & Medical Group, 3i Infotech and Blue River Capital. He can be reached at mcshekaran@gmail.com)