A lead on growth
Infosys chairman N.R. Narayana Murthy says men may come and men may go but corporations should go on forever.
I still remember that day in early 1964 when my father, a high school teacher, was highly distressed at dinner. Dinner time was when the entire family listened to his weighty school-teacher-type pronouncements on the news of the day and the continuum of progress the country was making. He was a great fan of Jawaharlal Nehru and was very optimistic about the future of the country. After dinner, I went to my mother and asked why father was so sad.
She talked about Nehru's sickness and how it had upset father since he was worried about the future of the country. I, too, was distressed since we rarely saw our father in such a mood. That was when my grandmother, a hardly-literate but very clever woman, told her son not to worry - after all the country had survived Rama, Krishna, Buddha and Gandhi.
My grandmother's words are as true today for a corporation as they were then for our nation. Men may come and men may go but corporations should go on forever. Corporations should be designed to survive the loss of giants as well as the misrule of despots. GE has survived the exit of legendary Jack Welch and has, indeed, gone on to greater heights under the current CEO, Jeff Immelt. Goldman Sachs has become stronger under Lloyd Blankfein than it was under Hank Paulson.
Nearer home, Reliance Industries has expanded several times under the leadership of Mukesh Ambani after the demise of his legendary father, Dhirubhai Ambani. Ratan Tata has transformed the group of Tatas in a way not imagined. Kumar Mangalam Birla, the shy and self-effacing son of another corporate giant - Aditya Birla - has gone on to extraordinary achievements. Hindustan Lever has made rapid progress even after rare business leaders like Prakash Tandon, Ashok Ganguly and Vindi Banga have left that great institution. It was thought impossible to step into the shoes of N. Vaghul of ICICI but K.V. Kamath did such a brilliant job that only another star like Chanda Kochhar could even dream of emulating his success.
What is it that the departing leaders of these corporations did to ensure that their companies did not trip up when they left the scene? They realised pretty early that their success depended on how well they could create a cadre of future leaders to handle higher revenues and profits, more customers and employees, challenges of innovation and competition, and ever increasing expectations of the society. They created systems for recruiting the best talent from universities and for training these people to aim high, take tough decisions, handle dilemmas, pursue values steadfastly, get their people to reach for the stars, reach out to society, and handle the ups and downs of business with equanimity.
They then chose the most promising ones amongst these employees to climb the corporate ladder fast, and gave them opportunity to exercise these skills while providing a safety net for them. They evaluated their wards constantly, applauded them on their strengths in public, gave constructive feedback on their weaknesses in private, and pushed them constantly towards 'stretch targets'. They mentored their wards and built confidence in them to handle tough situations.
While flashes of extraordinary leadership that one sees in a corporation from time to time are indeed important, what is even more important is the institutionalisation of sound, robust and sustained leadership for all times to come. Such institutionalisation can only happen with a philosophical foundation of values, an awe-inspiring time-invariant and constant-invariant vision, and creation of institutional memory, training, systems, processes, checklists, tools, rewards and penalties. Let me describe how we, at Infosys, have grappled with these challenges. These ideas may have changed slightly in the last decade since my departure as the CEO but the core remains the same.
Our leadership development is predicated on three tenets. First, we believe that our company is our campus, a place for constant learning. Constant learning is at the heart of our success. Therefore, we have created an environment of openness, meritocracy, pluralism, discussion and debate which are the hallmarks of a university campus. Second, we believe that our business is our curriculum. Leaders have to understand their context well so that they can excel in it and, indeed, transform it to be successful in the next higher orbit. Therefore, it is very important that they are taught the opportunities, challenges, dilemmas and nuances of our business.
Third, we believe our leaders are our teachers. Any effective leadership training requires authenticity and credibility of the teachers and of the case studies they use in the class. Therefore, at Infosys, every leadership course is taught only by internal leaders who have lived through these situations. We have three tiers of leadership at the company. Tier I leaders are about 50 in number, are just below the board and are from the top management cadre. These leaders are selected after extensive evaluation of their performance and intensive interviews by internal directors. The next level has 150 leaders. They are selected from among the senior management and some extraordinary talent from middle management. These leaders are chosen by Tier I leaders and a couple of internal members of the board. Tier III of leadership has about 450 leaders chosen from the middle management. They are selected by a group consisting of Tier I, Tier II and at least one internal member of the board. The continued membership of any of these three tiers requires that the chosen leader performs according to expectations.
If a leader fails to perform for two consecutive years, then he or she is out of the programme but will have the opportunity to come back into the programme again through high performance.
Once the leaders are chosen, they come under the care of the Director of the Infosys Leadership Institute (ILI) and are nurtured very carefully through training programmes and mentoring sessions designed by it. The focus of training at ILI is on developing leaders who achieve the plausibly impossible, who raise the aspirations of their teams, who are generous in making their teams look an inch taller, and who become the champions of Infosys values. They are taught leadership challenges, people skills, strategic thinking, execution excellence, thought leadership in technology and business, and relationship building. They are taught to become comfortable in handling moral dilemmas, negotiating across cultures, communicating negative news to bosses and subordinates, being optimistic and confident in difficult situations, balancing budgets, handling the media, demonstrating social responsibility and commitment to sustainability. In addition, they are also taught courses on finance, sales, HR, branding, software project management and consulting. Every chosen leader goes through 15 days of training each year. The Tier I and Tier II courses are taught by the internal board and the CFO.
I teach a course titled: Leadership - My Style, My Beliefs and My Convictions. Using Infosys case studies from the days of its founding to the current, I discuss how Infosys leaders have demonstrated the attributes we expect of the young leaders. Classes are full of discussions, debates and, sometimes, disagreements.
Participants are encouraged to present their points of views, no matter how heretic they are. The participants learn that there is no right or wrong answer, but that there is only an appropriate answer for a given situation. In addition, each participant is given an assignment on how he or she would handle a specified tough situation if he or she were the CEO.
An important instrument of leadership development at Infosys is leadership by example practised by senior leaders, who act as role models for exemplary behaviour. In a knowledge company like Infosys, our youngsters are bright and educated. They observe keenly, collect data, analyse, come to conclusions, and act. Therefore, it is extremely important that the senior people at Infosys demonstrate integrity of thought and action in every transaction. There is no better way of doing it than leading by example, practising the precept, and walking the talk.
Another important instrument used at Infosys for leadership development is mentoring. The mentee chooses his or her mentor rather than the mentor choosing the mentee. It is an open, voluntary and private relationship. A mentor is not the immediate or 'skip-level' boss of the mentee since we do not want any corporate hierarchy to inhibit the mentee from expressing his or her problems and dilemmas openly. Generally, a mentor is advised to limit his or her mentoring to six or seven mentees since mentoring involves considerable time.
I must admit that the leadership journey has not been without hiccups at Infosys. Some of our leaders have committed huge mistakes. I have committed many mistakes in my career. We are all human and we commit mistakes. There is no reason why the younger leaders should not have the same opportunity to learn from their mistakes. However, we cannot condone any transgression of the fundamental values of the company. With this proviso, we should provide a safety net for budding leaders to reach for the stars, to take tough business decisions and make judgment calls even at the risk of possible failure. This is how we raise the confidence of budding leaders to do extraordinary stuff since they know that their elders are standing by for any advice, cheering them from the sidelines, and ready to provide a soft shoulder to cry on if necessary. This has been the story of leadership transition at Infosys.
Buy the Business Today January 9 edition for more such columns by business leaders like Kumar Mangalam Birl, Azim Premji and Nandan Nilekani.
She talked about Nehru's sickness and how it had upset father since he was worried about the future of the country. I, too, was distressed since we rarely saw our father in such a mood. That was when my grandmother, a hardly-literate but very clever woman, told her son not to worry - after all the country had survived Rama, Krishna, Buddha and Gandhi.
My grandmother's words are as true today for a corporation as they were then for our nation. Men may come and men may go but corporations should go on forever. Corporations should be designed to survive the loss of giants as well as the misrule of despots. GE has survived the exit of legendary Jack Welch and has, indeed, gone on to greater heights under the current CEO, Jeff Immelt. Goldman Sachs has become stronger under Lloyd Blankfein than it was under Hank Paulson.
 My grandmother, a hardly-literate but very clever woman, told her son not to worry - after all the country had survived Rama, Krishna, Buddha and Gandhi. |
What is it that the departing leaders of these corporations did to ensure that their companies did not trip up when they left the scene? They realised pretty early that their success depended on how well they could create a cadre of future leaders to handle higher revenues and profits, more customers and employees, challenges of innovation and competition, and ever increasing expectations of the society. They created systems for recruiting the best talent from universities and for training these people to aim high, take tough decisions, handle dilemmas, pursue values steadfastly, get their people to reach for the stars, reach out to society, and handle the ups and downs of business with equanimity.
They then chose the most promising ones amongst these employees to climb the corporate ladder fast, and gave them opportunity to exercise these skills while providing a safety net for them. They evaluated their wards constantly, applauded them on their strengths in public, gave constructive feedback on their weaknesses in private, and pushed them constantly towards 'stretch targets'. They mentored their wards and built confidence in them to handle tough situations.
While flashes of extraordinary leadership that one sees in a corporation from time to time are indeed important, what is even more important is the institutionalisation of sound, robust and sustained leadership for all times to come. Such institutionalisation can only happen with a philosophical foundation of values, an awe-inspiring time-invariant and constant-invariant vision, and creation of institutional memory, training, systems, processes, checklists, tools, rewards and penalties. Let me describe how we, at Infosys, have grappled with these challenges. These ideas may have changed slightly in the last decade since my departure as the CEO but the core remains the same.
| We are all human and commit mistakes. There is no reason why the younger leaders should not have the same opportunity to learn from their mistakes. But, we cannot condone any transgression of the fundamental values of the company |
Third, we believe our leaders are our teachers. Any effective leadership training requires authenticity and credibility of the teachers and of the case studies they use in the class. Therefore, at Infosys, every leadership course is taught only by internal leaders who have lived through these situations. We have three tiers of leadership at the company. Tier I leaders are about 50 in number, are just below the board and are from the top management cadre. These leaders are selected after extensive evaluation of their performance and intensive interviews by internal directors. The next level has 150 leaders. They are selected from among the senior management and some extraordinary talent from middle management. These leaders are chosen by Tier I leaders and a couple of internal members of the board. Tier III of leadership has about 450 leaders chosen from the middle management. They are selected by a group consisting of Tier I, Tier II and at least one internal member of the board. The continued membership of any of these three tiers requires that the chosen leader performs according to expectations.
If a leader fails to perform for two consecutive years, then he or she is out of the programme but will have the opportunity to come back into the programme again through high performance.
Once the leaders are chosen, they come under the care of the Director of the Infosys Leadership Institute (ILI) and are nurtured very carefully through training programmes and mentoring sessions designed by it. The focus of training at ILI is on developing leaders who achieve the plausibly impossible, who raise the aspirations of their teams, who are generous in making their teams look an inch taller, and who become the champions of Infosys values. They are taught leadership challenges, people skills, strategic thinking, execution excellence, thought leadership in technology and business, and relationship building. They are taught to become comfortable in handling moral dilemmas, negotiating across cultures, communicating negative news to bosses and subordinates, being optimistic and confident in difficult situations, balancing budgets, handling the media, demonstrating social responsibility and commitment to sustainability. In addition, they are also taught courses on finance, sales, HR, branding, software project management and consulting. Every chosen leader goes through 15 days of training each year. The Tier I and Tier II courses are taught by the internal board and the CFO.
I teach a course titled: Leadership - My Style, My Beliefs and My Convictions. Using Infosys case studies from the days of its founding to the current, I discuss how Infosys leaders have demonstrated the attributes we expect of the young leaders. Classes are full of discussions, debates and, sometimes, disagreements.
Participants are encouraged to present their points of views, no matter how heretic they are. The participants learn that there is no right or wrong answer, but that there is only an appropriate answer for a given situation. In addition, each participant is given an assignment on how he or she would handle a specified tough situation if he or she were the CEO.
An important instrument of leadership development at Infosys is leadership by example practised by senior leaders, who act as role models for exemplary behaviour. In a knowledge company like Infosys, our youngsters are bright and educated. They observe keenly, collect data, analyse, come to conclusions, and act. Therefore, it is extremely important that the senior people at Infosys demonstrate integrity of thought and action in every transaction. There is no better way of doing it than leading by example, practising the precept, and walking the talk.
Another important instrument used at Infosys for leadership development is mentoring. The mentee chooses his or her mentor rather than the mentor choosing the mentee. It is an open, voluntary and private relationship. A mentor is not the immediate or 'skip-level' boss of the mentee since we do not want any corporate hierarchy to inhibit the mentee from expressing his or her problems and dilemmas openly. Generally, a mentor is advised to limit his or her mentoring to six or seven mentees since mentoring involves considerable time.
I must admit that the leadership journey has not been without hiccups at Infosys. Some of our leaders have committed huge mistakes. I have committed many mistakes in my career. We are all human and we commit mistakes. There is no reason why the younger leaders should not have the same opportunity to learn from their mistakes. However, we cannot condone any transgression of the fundamental values of the company. With this proviso, we should provide a safety net for budding leaders to reach for the stars, to take tough business decisions and make judgment calls even at the risk of possible failure. This is how we raise the confidence of budding leaders to do extraordinary stuff since they know that their elders are standing by for any advice, cheering them from the sidelines, and ready to provide a soft shoulder to cry on if necessary. This has been the story of leadership transition at Infosys.
Buy the Business Today January 9 edition for more such columns by business leaders like Kumar Mangalam Birl, Azim Premji and Nandan Nilekani.
