"Collaborative leadership works better than being hierarchical"

I could not believe the way we galloped: in five years, ABB India grew 10x — from Rs.800 crore to Rs.8,000 crore and the market cap grew from Rs.700 crore to Rs.42,000 crore. We tried so many new experiments. We made the offices cabin-less, an idea I picked up from Sweden. Anybody could walk up to anyone; I sat in the hall with everyone else. It was informal and the collective energy galvanised everyone into action. 

I so vividy recall the day Shuvro Chakraborthy came to me, completely lost, saying he didn’t know what to do because there were very few takers for his products in India. He was running the process analytics business of Taylor Instrument, which was later acquired by ABB. I asked, “Shuvro, how much faith do you have in the promise of the business?” He said he could grow the business 3x in two years provided he could make some investments. Chakraborthy was extremely knowledgeable, very softspoken, I saw a spark in him and said, “Don’t worry, you’ll get all the support you need.” He had a unit in Faridabad and we made an investment of Rs.10 crore and he was such a roaring success over the next two years. He signed on all the big clients — Engineers India, Reliance, GAIL. Ditto for Arvind Vasu; he made ABB India the biggest robotics supplier in the country.

It was a wonderful team again — K Rajagopal, P C Rajiv, Inder Sadhu, and so many more remarkable people. My 3S philosophy worked wonders — the spirit to win, systems to support, and speed. I recall telling the team that we had entered the digital age, in which there is no consolation prize for the runner-up — either you get it or lose it all.

When I became Asia-Pacific head for ABB Group, I was able to take several of these attributes with me. And later again as the head of global markets, where I had eight regional presidents reporting to me from 75 countries. That was such an interesting experience — to work with diverse nationalities, idiosyncrasies and value systems; you mature a lot, you start to live in a system where people have differences with you, but you still learn to work along accepting that you can’t make everyone think the way you are thinking. It was hard for many Americans and Europeans to accept that they had to report to an Asian. That was the true test of my leadership and I figured that rather than confrontation, it was best to say I am running along with you, and supporting them. And to give them full independence. Collaborative leadership works better than being hierarchical. 

I knew from my Volvo experience, when you need to accomplish the impossible, you need to lead from the front and show it’s possible. ABB taught me, when people are doing their jobs, all you need to do is prompt them from behind... just encourage them. Let them do their job, and just watch from the corner of your eyes. Unsurprisingly, thanks to the team again, we saw growth in turnover from $2.8 billion in 2005 to $4.6 billion by 2007. But they achieved it, not me.

As I went on in my professional journey, I strongly held onto my convictions that the local managements are very effective and strong. When I was the head of the global markets, I conveyed my policy very clearly — we would agree on a target, after that it would be their game plan and how they achieved it. I would give them resources, money, but without any interference. I empowered people and trusted them. 

I loved my job as head for global markets at ABB. Children Neel and Nidhi were out of home and settled, Geeta stayed in Zurich, while I travelled all over the world. Germany, Switzerland, Singapore… visiting different places was a fulfilling experience. But I was most impressed with the Scandinavians: they are socio-democrats. Everything is equal — there’s not a very big difference between the salaries of the lowest and highest employees, and it’s monitored all the time. The thinking is that you may be doing different jobs but that does not mean your income levels should be vastly different, because we all have the same needs. That’s some very evolved thinking.

 ***

I had decided to come back home for the collective good of the family. My parents were ageing, and be it work or family, you can’t be thinking of yourself alone. Coincidentally, AM Naik, chairman, L&T approached me around the same time, so I took up the offer of joining the engineering conglomerate. Leveraging my experience to take an Indian icon to greater heights looked like a great move even professionally. 

I was in start-up mode again, setting up the power business for L&T. What an experience the JP Power Plant installation was! We had a 51:49 joint venture with Mitsubishi for setting up the boiler and turbine package for the 1400 MW power plant. Everything was finalised. As per plan, on the first day on site, the Japanese came dressed in their uniforms, wearing safety glasses, helmets, gumboots… and then came our team: some workers were in casuals, chappals, loose shirts with a few buttons missing, no safety gear... The contrast was glaring. The Japanese team looked shocked. Nevertheless, they decided to go ahead with work and asked for the methodology to be followed, in black and white. Our supervisor was not used to this: “We have everything planned in our head.” 

A blame game began. The super-skilled, highly methodical Japanese found the Indian way of working a bit casual. Our team, of course, felt the Japanese were being unnecessarily rigid and dogmatic. Ouch! The matter escalated and discussions went right up to the board of which I was the chairman. The Japanese just wouldn’t budge because that’s the way they work. Finally, our supervisor was convinced to chart out the methodology on paper. Work started, with much bickering from the Indian side. But it ended precisely on time, with absolutely no glitches. The supervisor came up to me and said, “Sir, the Japanese were right — once the plan was laid out so clearly, there was no room for error.” 

As a civilisation, we have so much to learn from others. We are mathematical, analytical, willing to expend much emotion and energy, but we still have a long way to go in terms of resource planning. 

The Jindal brothers were trying to take the next leap — transform the company on the lines of a multinational. It sounded exciting also because I could finally spend more time being in the city where life began, with the people who got me going and taught me the best way to lead life is to be not too exuberant when things are good, and not too depressed when things are low.

It was one gratifying moment when Sajjan Jindal, chairman of JSW Group said when I met him with Naveen Jindal, chairman of JSPL at Vijaynagar that when I was with ABB, his first, second and third choice was ABB, ABB and ABB. Can’t forget the day he called me saying the plant had shut down because of a cyclo-converter failure. It was 10 am on Saturday. I was in Switzerland. He did not know whom to call in at ABB Worldwide. I said, “Mr. Jindal, don’t worry, I’ll organise it.”  And we did. We could track down the guy in Finland who was the best guy to fix it and we sent him to India. That probably stuck.

 ***

When I was in ABB, we were the first in Bangalore to support Akshaya Patra’s two villages, way back in the ’90s. We had some 250 young boys and girls who were provided daily meals — those meals were the single biggest motivator for those young children to go to school. 

When I returned to Bangalore, I saw Pushpa Rao serving girls who were orphaned, physically challenged and could not fend for themselves. I was overwhelmed. We adopted that shelter of 40 girls through our CSR group. Pushpa was such a thoughtful lady, she wanted the girls to do something constructive, so we assigned them jobs such as electric assemblies, electrical fittings. It empowered them, made them self-reliant — they were making something like Rs.2 lakh a month. That was my most fulfilling experience, apart from the driver’s training programme. 

In Indian society, we need to be extremely benevolent and magnanimous because the percentage of have-nots is so much higher here, that the more we do, the less it is. So many illiterates, so much oppression, all because these underprivileged people don’t even know their rights. These experiences have made me realise we have a greater purpose in life than simply attending to business. One thing that remains close to my heart is to set up multi world-class skill centres for our youngsters and adults to acquire contemporary global levels. I don’t believe in charity but in enabling the weak and underprivileged to stand firm on their own feet. If I could do it, I would consider it as a major achievement of my life journey.

Embrace the change and keep innovating. The external environment is changing at a mind-boggling pace. For you to remain relevant, you must lead the change. Companies must adopt the right business model. If your business model is not right, you will disappear. Companies such as Fuji and Kodak vanished because they could not innovate. So, keep pushing the boundaries and get into areas that have core value in the new environment. For instance, IBM and even Dell were basically hardware producers. But now, most revenue comes not from hardware but services. They changed their business models and innovated. Even companies such as Motorola or Xerox, which had become the generic names for the businesses, became irrelevant when they stopped innovating and could not keep pace with the innovation of others. On the other hand, look at Apple. The Apple of the 1980s and '90s was a great success; then it disappeared and came back in 2006-07 with a new version of itself because it had re-discovered, re-innovated itself!

Nobody, not even the larger-than-life business legends, can achieve anything if they do not carry the team with them. People have complementary skills and you need everyone’s contribution to make a success. The guys who produce, the guys who design, the guys who deliver, distribute — they are all equally important. If any link is weak, the entire plan can collapse.

People must have an entrepreneurial attitude. They should go beyond the job and come up with ideas for new product lines, new services, new clients. Today, it is not enough to be just a good manager; you also have to be innovative and entrepreneurial so that you can come out with good ideas. 

Flexibility is key. Any function that becomes rigid loses its sheen. We must have a way to energise the system all the time. Don’t let it get typecast. Many companies don’t have a dedicated R&D department. What they do is assemble teams of people to do R&D projects. They bring together the best people from diverse backgrounds— electronics, software, visual imaging, telephone knowledge, communication knowledge… — and make them innovate things. The Manhattan Project of 1942 under the leadership of Robert Oppenheimer brought in some of the best scientists — Edward  Teller, Enrico Fermi, Oppenheimer himself, Neils Bohr — to assemble something called a nuclear bomb. They were moved to Nevada and worked on the project for three years; once the project was over, the team was dismantled. Companies need to adopt the same approach. Instead of permanent R&D teams, companies must assemble teams drawing upon the best talent. 

We are in an era of partnerships. As the world around gets more complex, nobody is capable to do everything in the best possible manner. Many big companies today are only assembling things, they don’t do things in-house. For instance, when I was with Volvo, I noticed they were not making gear boxes or axles; most of the hardware was outsourced to companies that were very good at that. Collaborating with others is crucial in today’s environment. 

Companies that have the energy of younger people are more nimble, more energetic, and are most successful. I surround myself with youngsters in the 26-to-35-year age group because I feel my wisdom and experience and their energy is a good combination. 

Communication is key. It is extremely important that you communicate your vision and targets with your team. You can’t give them piecemeal jobs; they wouldn’t know what to relate it to and if they don’t have the big picture, they may not get galvanised to do their best. But sit them all together and say, “We have to achieve so-and-so goal. How do we do it?” and they will all be excited and want to make sure they are all successful. Bring your employees on board by sharing your visions, targets and plans. 

Create a balance between informality and formal systems within the organisation. You should be able to walk along the corridor, put your arm around the shoulder of a young employee and ask what can be done better. But if there is no formal system at all, employees will be confused as to what is expected of them.

This is the third of a three-part series. You can read part one here and part two here.