Archive for the ‘Management’ Category

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Essence of a Manager

February 11, 2011

My book now has a publication date in March 2011 and advance copies can be ordered from Springer.

It can also be obtained through Amazon (UK) and Bokus.

Springer Science+Business Media


Essence of a Manager

Pillai, Krishna, 1st Edition., 2011, XIV., Hardcover

ISBN: 978-3-642-17580-0

Due: March 2011

What makes a “good” manager? This is a book by a manager about managers but it is not just for managers. It is for anyone and for everyone who is interested in the way people – and not just managers – behave and function around the world. Based on actual experience the title “Essence of a Manager” is a succinct distillation of what this book is about. It is not a management manual and yet it is a map for navigation and a guide for behaviour which can be valuable for practicing managers at all levels. It formulates a sound thesis to describe the qualities needed in a “good” manager and builds up from elemental qualities to develop a holistic view of a good manager. Nine fundamental attributes are proposed as being necessary and sufficient to describe a “good” manager. It is applied management philosophy for a thinking manager and deals with the fundamental drivers which lie deeper than language or culture and which control human behaviour.

Amazon (UK)

Bokus.com

Some reviews can be found here: Reviews EOAM – Around the world and back to Finspång

Lars-Otto Gullman, retired, former Director Metallurgy, Gränges, Finspång

I wish I had read Essence of a Manager some 40 years ago, prior to my own industrial career!  A similar presentation of the demands on a manager and how a manager can develop his abilities I have not seen till now. In Essence of a Manager the author analyses the nature of the personal qualities a good manager must possess to be able to perform his tasks in a satisfactory way. A method, based upon interview technique, is presented as an effective means of identifying potentially good managers. Many examples are given from the author´s long and worldwide experience of managements styles in different countries and cultures.


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Airbus vs. Boeing: or a tale of the marketing of delays and engine problems

November 26, 2010

For large, complex, expensive, high-technology products (airplanes, turbines, power plants or ships for example) it is usually not worth indulging in too much negative marketing based on a competitor’s technical difficulties. Early technical difficulties and “teething” problems are common and when a competitor has difficulties it usually leads to some feeling of satisfaction but it is tempered by the knowledge that one could easily suffer similar difficulties. So when GE experiences some problem with its gas turbines or Areva has delays in its nuclear plants there will never be an overt, negative marketing campaign by Siemens against GE or by Westinghouse against Areva.

File:Airbus A380.jpg

A380: image wikipedia

And this is the current situation between the Airbus A380 and Boeing’s 787 Dreamliner. The A380 had its share of delays and was over 2 years late in coming into service. Right now the troubles that Rolls Royce are having with their Trent 900 engines is not helping the A380 image. (There are only two engines available for the A380 but it is noteworthy that the General Electric / Pratt & Whitney Alliance which manufacture the GP7200 engine which competes with the Trent 900 are not indulging in any overt negative marketing). The “Rolls Royce effect” for Airbus is currently negative because of the Trent 900 issues but it is indirectly mitigated by the reports of delays in developing the Trent 1000 which is one of the engines for Boeing’s 787.

File:Boeing 787first flight.jpg

B787 First flight: image Wikipedia

As Airbus fights to get airlines to accept the A380 their “best friend” strangely is the delays to the B787 Dreamliner program. The Dreamliner has been further delayed by an electrical system fault which caused a fire on a test flight in early November. For an airline the decision of choosing between Boeing and Airbus has become not one of comparing the advantages each has to offer but instead one of judging the risk exposure that a choice may bring. It becomes a comparison of potential “downsides” and risk mitigation possibilities rather than selecting between potential “upsides”.

For Airbus and Boeing, their sales processes now have to emphasise the risk mitigation available with their products rather than promoting all the advantages their products have to offer. This is unusual for a “sales process” but nothing new in the history of marketing of technologically new products. But it is not so easy for corporations, their salesmen and for sales processes to shift from promoting advantages to the much more difficult task of showing that the risks (whether of delay or of technical difficulties) they pose are less than that of the competitor. Even in terms of financing, the usual offers of financing and leasing packages for the customer must now additionally address the mitigation of financial and consequential exposures in the event that a risk materialises. When a single A380 costs around $320 million, a Boeing 747-400 about $250 million and a Dreamliner has a price tag of $150 -200 million, then downtime and delays have enormous financial consequences for the customer. Marketing strategy for new products in the face of heightened risk perceptions is quite different to the marketing of “tried and tested” products. But this is a fascinating marketing challenge!

The latest reports of delays to the Dreamliner has led to harsh words about Boeing from a potential customer. CityAM reports:

QATAR Airways has threatened to hand extra business to European aircraft giant Airbus after attacking Boeing over problems with its new 787 Dreamliner. Chief executive Akbar Al Baker said the airline was considering increasing its order for five Airbus A380 super-jumbo planes and might order a re-engined version of the A320 single-aisle jetliner. He did not say how many more A380s it might order.

Qatar has expanded its fleet from four to 94 aircraft in 13 years and has orders for 200 more from Airbus and its US rival Boeing worth $40bn, including 30 Dreamliners. Al Baker said Boeing had “failed” in developing its 787 Dreamliner, which is expected to suffer further delays following a fire on a test flight.

Boeing’s development of the carbon-composite 787 is running around three years late and brokers expect a further delay as it addresses the cause of a fire which led to the test flight being grounded two weeks ago.

But I would expect that there is a strong element of price negotiation in Qatar Airways’ statement!

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In spite of strong yen, Japan Inc’s sales and profits soar

November 9, 2010

From Asahi News:

Japanese companies posted huge increases in sales and profits in the first half of fiscal 2010, but the “China risks” coupled with the strong yen threaten to pummel performances in the second half.

photo

Toyota Motor Executive Vice President Satoshi Ozawa releases business results in Tokyo on Friday. (The Asahi Shimbun)

Aggregate sales rose 11.6 percent from a year ago, while pretax profits increased 131.7 percent and net profits soared 179.8 percent, according to Nikko Cordial Securities Inc.’s survey of 650 companies listed in the First Section of the Tokyo Stock Exchange that had released their half-year results by Thursday.

But the companies say the business turnaround could be short-lived depending on what happens in China. Chinese exports of rare earth minerals, vital ingredients in high-tech production, were stalled in September when Beijing demanded the release of a Chinese captain whose fishing boat rammed Japan Coast Guard vessels near the disputed Senkaku Islands in the East China Sea. The de facto ban on rare earth exports to Japan came on top of China’s increasingly tight export quotas on the materials.

Chinese imports account for more than 80 percent of clothes sold in supermarkets and other stores operated by Aeon.

Many manufacturers say they have secured rare earth supplies for the short term, but a prolonged delay in delivery would inevitably hit them hard.

Japan is pursuing alternative supply sources in India and elsewhere to reduce Japan’s reliance on China, which accounts for 97 percent of the world’s supply. But such development will take time.

While trading firm Toyota Tsusho Corp. is developing rare earth mines in Vietnam, Executive Vice President Kenji Takanashi said the work “will take at least two to three years.”

Meanwhile, export-oriented companies say their efforts to fend off the impact from the yen’s appreciation are reaching their limits. Toyota Motor Corp., for example, expects currency exchange losses to total 320 billion yen ($3.94 billion) for the year ending in March, which will more than offset its estimated profit rise from sales increases totaling 280 billion yen.

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Commonwealth Games: The inquest begins

October 17, 2010

The “last minute syndrome” is a unique and peculiar asset in India

The Games were supposed to cost under Rs 2,000 Crores (about 450 Million$).

The actual cost is likely to be around Rs. 30,000 Crores (about 6.7 Billion $).

About 500 Million $ has probably been paid for fictitious work, over-invoiced and overpaid to contractors, skimmed off or pocketed by individuals connected to the Organising Committee headed by Kalmadi. Some individual fortunes have been made and squirrelled away into Swiss and Channel Island and Caribbean bank accounts.

CWG Delhi Closing ceremony: image bharatchronicle.com

 

The investigations have begun. Some scapegoats will have to be found. Shrill voices are questioning whether it was worth it or not. There is no shortage of suggestions about how all the money could have been better spent.

For example Vir Singhvi writes in the Hindustan Times:

We could have overhauled healthcare in our cities. We could have built thousands of new schools. We could have overhauled the chaotic traffic system. We could have spent that money on recruiting more policemen and giving them the facilities they need. We could have built hundreds of new courts and recruited more judges to reduce the backlog in our judicial system.

But I have a somewhat different take.

None of the predicted or feared catastrophe’s occurred. There were no terrorist attacks. There was no epidemic of dengue fever. The facilities at the Games village largely functioned well.  The logistics were chaotic to begin with but also largely functioned satisfactorily. As the performance of India’s athletes started bringing in the medals at the Games, the crowds which were initially absent started showing up. The opening ceremony was well carried out but the logistics on the opening day were chaotic and stressful for many athletes. But this was transformed by the time of the spectacular closing ceremony in front of a packed house.

In transforming an apparently hopeless situation into a qualified success by means of India’s patented “last minute syndrome” some heroes appeared. Sheila Dikshit the Chief Minister of Delhi and Dr Manmohan Singh, the Prime Minister can I think be credited with the success of the final mobilisation of effort. Politicians who were busy distancing themselves from the Games the week before it started were clamouring to be seen at the closing ceremony. The Delhi Police must take a bow not only for the security aspects but also for the handling of traffic. The organisers (and even the newly activated Committee who were now under the whip) and all the officials and “volunteers” and even the Delhi population pulled out all the stops. Many private contractors with their contract labour carried out a minor miracle on the last few days.

And this brings me to my point. One of the key issues in India is not – in the first instance – the availability of funding. The Indian weakness is in implementation, in using the money available well. Whatever the Games cost, the money was forthcoming when needed. About 10% was probably wasted. But because of the attention and pride (or more accurately the potential loss of face), a fiasco was averted. The “last minute syndrome” was activated. Implementation, and rather effective implementation, took place.

Even if there had been no Games and even if all the money had been poured into health care or traffic improvements or overhaul of the judicial system it would have achieved virtually nothing. Without attention and without visible deadlines to create a potential loss of face and -therefore – without a means of activating the “last minute syndrome” the money would have been frittered away.

It would be much more constructive if, instead of moaning about what could have been, every project being implemented in India could figure out a way of creating the real deadlines which could activate the “last minute syndrome”.

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Tata Group gives 50 Million $ to Harvard Business School

October 14, 2010
This is a portrait of Mr.Ratan Naval Tata made...

Ratan Tata: Image via Wikipedia

Times of India

BOSTON: America’s prestigious Harvard Business School has received a whopping USD 50 million from Ratan Tata-led Tata Group, the largest gift from an international donor in the institution’s 102-year history.

The USD 50 million gift comes just days after Anand Mahindra, vice-chairman and managing director of Mahindra and Mahindra, gave USD 10 million dollar as gift to the Humanities Centre at Harvard.

Ratan Tata, Chairman of the Tata conglomerate, attended the school’s Advanced Management Programme–one of three comprehensive leadership programmes offered by HBS Executive Education–in 1975.

He received the school’s highest honour, the Alumni Achievement Award, in 1995.

The gift will fund a new academic and residential building on the HBS campus here for participants in the school’s broad portfolio of executive education programmes.

The school hopes to break ground for the building, which will be named Tata Hall, next spring.

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Why Forecasts need to be wrong

October 7, 2010

 

The Lorenz attractor is an example of a non-li...

Image via Wikipedia

 

This started yesterday as a short comment on the changing forecasts by Hathaway on solar activity in Solar Cycle 24 but has now become something else.

As clarification, I  distinguish here between prophecies and forecasts  where:

  • I take prophecies to be a promise about the future  based primarily on faith and made by prophets , witchdoctors, soothsayers and politicians such as “You will be doomed to eternal damnation if you don’t do as I say”,
  • I take “forecasts” to be an estimate of future conditions based on known data with the use of calculations, logic, judgement, some intuition and even some faith. They are extrapolations of historical conditions to anticipate – and thereby plan for -future conditions.

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Women highly successful in Indian Banking and in India Inc.

September 19, 2010

Gender imbalances continue to prevail in corporate boardrooms across the world, but the situation is much better in India if the number of women CEOs that India Inc has is any indication–nearly four times more than that of the US–a survey says.  According to a survey by international executive research firm, EMA Partners International, around 11% of Indian companies have women CEOs, while in the case of Fortune 500 list from the US, the women CEOs just account for three% of the total consideration set. “In the backdrop of the Fortune 500 numbers, the Indian results certainly look a lot better, though on a standalone basis, it is clear that barring financial services, other industries have a long way to catch up,” EMA Partners chairman James Douglas said in the survey.

The Times of India: According to a study by Standard Chartered Bank about women on corporate boards in India, the financial sector performs best in terms of gender diversity, nine of the eleven banks listed on BSE-100 have a woman on their board and two of these banks have a female CEO. In fact, through the recent recession, Reserve Bank of India had two women deputy governors on board, Usha Thorat and Shyamala Gopinath.

Women leaders in banking

ICICI Bank, India’s second largest bank after State Bank of India, is headed by a woman, Chanda Kochhar. So is the third largest in the private sector, Axis Bank, with Shikha Sharma at its helm. HDFC Ltd, India’s largest housing finance group has Renu Sud Karnad as its managing director; Kalpana Morparia heads the Indian arm of global financial leviathan JPMorgan Chase & Co; Meera Sanyal is the country executive for Royal Bank of Scotland and; Manisha Girotra is the managing director of Union Bank of Switzerland‘s India operations.

“Women are not driven by wanting to just show numbers,” says Karnad, who feels the recession was a result of excesses, of wanting to achieve goals at whatever cost. “Women are more practical and moderate in risk taking.”

So what is it that makes women so successful in the Indian banking and financial services industry? “Retail banking is more of a relationship thing and women excel at that,” says Karnad. In the Indian context, while women have started venturing out to work in the corporate world, they have been handling relationships at home too, as a wife or a mother. “This nurturing and adjusting attitude flows into the workplace as well.”

The mid-80s saw a number of smart women graduating from the B-schools just when the Indian banking sector was starting to grow. ICICI, HDFC, HSBC, Citibank, were all expanding and were hiring during the mid-80s and the early 90s.

“We were fortunate to have senior role models like Tarjani Vakil, chairperson of Exim Bank who pierced the glass ceiling in the 1970s and ’80s,” says Meera Sanyal, who started her career in the mid-’80s with ANZ Grindlays Bank and is now Royal Bank of Scotland’s country executive for India.

ICICI particularly nurtured a number of women—Chanda Kochhar, Shikha Sharma, Renuka Ramnath—who have today reached the top. One of most prominent among them is Kochhar, who joined the bank as a management trainee in 1984 and rose through the ranks to become the managing director and chief executive officer. Today, of the eleven top executives working directly under her, three are women. “I give a lot of credit to ICICI, which as an organisation has allowed women to grow, prosper, handle responsibilities and offered equal opportunities,” says Kochhar. Of the overall 40,000 employees at ICICI, a quarter are women. “It has contributed a lot to the feminine quotient in the Indian banking sector.”

Additional Sources: http://economictimes.indiatimes.com/articleshowpics/6584055.cms

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Tata Nano +: Tata Motors riding high

September 19, 2010

Tata Nano +

Tata Motors is to woo Indian small car budget customers by launching an upgraded version of its Nano, the new Tata Nano Plus sometime in 2011. Tata Motors plans a Nano Plus with upgraded features. The Nano+ for the Indian market is expected to be similar to the Nano Europa.

Tata Nano was launched to woo the Indian automobile customers with its Rs. 1 lac (2200$) price tag but has failed to live upto the initial hype because of technical problems and issues of delayed delivery. The new Tata Nano + will include a more powerful 1000 cc engine instead of the older 623 cc engine. It will also include ABS, alloy wheels, integrated music systems and improved interiors. The car will be on the lines of Nano Europa and will compete with Maruti Alto and Chevrolet Spark. Delivery of the car  should not be a problem as the new Sanand plant increases production.

Tata Motors’ global vehicles sales rose 29% to 85,411 units in August 2010 over August 2009. The global sales include figures of its British luxury unit Jaguar Land Rover, whose sales rose 29% to 16,220 units in August 2010 over August 2009.

Tata CNG hybrid bus

Tata CNG hybrid bus

Tata Motors are also bringing out India’s first CNG-Electric hybrid public transport bus. It can accommodate 32 people, uses a parallel hybrid system and has a top speed of 72 kph.

Tata Motors has reported a growth of 29 percent in August. The entire sales of Tata’s vehicles totaled to 85,114 units in August 2010, a growth of 29 percent over August 2009. This has taken the cumulative sales for the fiscal year (April 2010 – August 2010) to 424,938, higher by 42 percent compared to the corresponding period in 2009-10. Sales of all commercial vehicles were 40,882 last month, a growth of 25 percent, taking the cumulative sales to 192,612, a growth of 35 percent.

2009 Jaguar XF photographed at the 2008 Washin...

Jaguar XF

Sales of all passenger vehicles were 44,232 in the month, a growth of 33 percent and the corresponding cumulative sales are 232,326, a growth of 49 percent. Tata passenger vehicle sales, including those distributed, were 28,012 for the month, a growth of 35 percent with a cumulative increase of 50 percent. Jaguar Land Rover global sales in August 2010 were 16,220 vehicles, higher by 29 percent. Jaguar sales for August 2010 were 3,788, higher by 33 percent, while Land Rover sales were 12,432, higher by 28 percent. Cumulative sales of Jaguar Land Rover for the fiscal are 92,759, higher by 46 percent. Cumulative sales of Jaguar are 24,919, higher by 31 percent, while cumulative sales of Land Rover are 67,840, higher by 52 percent.

Tata Motors is planning to launch new models with its Venture MPV and Aria Crossover in the near future.

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IBM is second largest private employer in India

August 18, 2010

In 2006 IBM had 53,000 employees in India which grew to 73,000 employees in 2007. Since then, the company has maintained that it is a global company and geographic numbers do not have any meaning in that context. In 2010 IBM employees in India exceeded 100,000 and may be as many as 130,000.

IBM still employs the most people in the US but almost one in three of IBM’s total workforce of over 400,000 is now in India.

http://www.accessnorthga.com/img/stories/205230/ibm-india_medium.jpg

The Times of India reports that

The fact that IBM has over one lakh (100,000)  people on its rolls in this country is one of India Inc’s best-kept secrets.
Tata Consultancy Services is the largest private sector employer in the country. It had 163,700 employees as on June 30.

No one in US-headquartered IBM will admit that it employs such a large number of people in India — for fear of a backlash at home. There’s been rising anger in the US over the transfer of `American jobs’ to lower cost havens, particularly India. Faced with an economic slowdown and a politically-damaging high employement rate, Barack Obama himself has begun to sound jingoistic. He has issued barely-veiled threats against US companies that ship out work and promised candies to those who stay patriotic.Even as an IBM spokesperson declined comment when contacted, a source within the company said that in a couple of years, the India employee strength could cross that in the US, where it employs about 1,55,000 people, and where the pace of hiring is substantially slower than in India. IBM globally has a little over 4,00,000 employees. So, close to 1 in 3 of its employees is already an Indian.

Its staff strength is more than four times that of India’s biggest private sector company, Reliance Industries, which employs about 23,000 people. It is bigger than the combined employee base of the two Tata Group’s crown jewels, Tata Steel (81,000) and Tata Motors (24,000).

A cross-section of industry analysts and manpower recruitment firms TOI spoke with not only put IBM’s India workforce (including that of its wholly-owned subsidiary IBM Daksh) at over one lakh, some even went to the extent of saying it might be 1.3 lakh — well over Infosys’ 1.14 lakh as on June 30. Infosys is India’s second largest IT firm by revenue and third, it now transpires, by employees.

Since 2007, the company has stopped disclosing the geographic break-up of its employee numbers. The last time it provided figures was in 2007, when it said it had 73,000 employees in India. Since then, the company has maintained that it’s a global company and geographic numbers do not have any meaning in that context.
 (more…)

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Brainstorming for Innovation

June 12, 2010

In conducting and participating in brainstorming sessions for innovation, I have found the critical requirements, judged empirically, to be:

  1. A limited number of participants (about 20 in my experience is a practical limit and 5 is too few),
  2. A minimum level of intellectual ability (and I have seen sessions ruined because “political correctness” or misguided notions of “fairness” have led to the inclusion of incompetent participants),
  3. Sufficiently long but not too long sessions (with each session never less than one whole day and never more than 3 days is my rule of thumb),
  4. Well prepared participants who have spent sufficient time in individual contemplation of the matter at hand (and since participants tend to come to such sessions unprepared it has always been worthwhile to allocate time – perhaps half a day for a two-day session – at the beginning of the session for individual contemplation),
  5. A clearly prepared initial “problem statement” even if the group may itself later modify the problem statement,
  6. A moderator capable of cutting across hierarchical boundaries, avoiding negative comments during any idea-generation phase, of enforcing the grounding of statements during the assessment of ideas and unafraid of puncturing “noise” and “stories”, and
  7. A clearly communicated post-session process.

In Idea Generation and the Quality of the Best Idea Prof. Girotra of INSEAD and Professors Terwiesch and Ulrich of Wharton examined the effectiveness of group dynamics and the innovation process. Their experiments show  that a hybrid process – in which people are given time for individual contemplation on their own before discussing ideas with their peers resulted in the generation of more ideas and of a higher quality than a purely team-oriented process. In a conventional team process concepts of “fairness” and hierarchical inhibitions were not conducive to innovation.

In my experience, the initial contemplation and role of the moderator and his ability are crucial.

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