In the early 1980s, I worked for Wipro at its Amalner plant, which manufactured vanaspati. That was the time when Azim Premji had come back from the US and was in the initial stages of defining Wipro's values and putting them into practice. As I went down the list of Premji's lessons, little instances came to mind, which were, perhaps, reflective of those learning moments.
Azim Premji is today the icon for integrity and integrity could be the "strength" he talks about in lesson 1 (build on your strengths). He certainly leveraged this strength well — but I can tell you it needs courage of conviction.
Those were the days when the vanaspati business was all about "on" (euphemism for black!) money. At the Amalner plant, we produced 7,000 tins of vanaspati per day and the going rate in those days was around Rs 15 a tin. Annually, that would have meant about Rs 4 crore of "on" money then and, at current money values, about Rs 50 crore per year. But Premji insisted on sticking to the Wipro value of integrity and, much against "practical" advice, Wipro refused to collect that money.
I have subsequently worked for companies which loudly touted their values of integrity but when it came to the crunch — and cash! — rationalisations, which come easy in a soft state like India, made way for an obvious breach of the stated value system. The lesson I learnt was that it is better not to talk about integrity if you can not stick to it. By some perverse logic, the employees trust you more if you shut up!
Premji's focus was on optimising capacity utilisation, efficiency of processes, and quality. The loss of "on" money was partially made up by the dramatic increases on all three fronts. I recall Premji being castigated by the other vanaspati manufacturers, ironically, for producing more, as it was hitting their "on"!
Some time later in my life, I worked for an industrialist who went the other way and concentrated on optimising his "on" money, much against my protestations. He ruined a company with a very good work culture. While personal cash flows increased in the short run, the leadership focus shifted from optimising business to optimising personal wealth. This led to the exodus of capable executives, the rise of "smart" executives and, since trust levels had plummeted and the vision was suspect, the company faded away after the opening up of the economy.
In a sense, having worked with Premji, I had a very difficult time fitting into the other companies where I worked. As the corporate world got "smarter", my "strengths" had a shrinking market, though I did reap a whole lot of benefits because of the integrity value.
The second lesson (what you build is far more valuable than what you inherit) triggered off this memory: With my middle class fear of speculative ventures, I used to wonder why Premji was passionate about diversifying into the risky electronics business (that was the original name for the computer division), when the business he had inherited was doing well. So, I argued vehemently in favour of the growth of the oil business, where we had established expertise, rather than venturing into software. Well, I guess that is why Premji is where he is and I am where I am!
The third lesson (enjoy success but let it not go to the head, learn from failures), was, I think, learnt when the attempts at change were failing miserably at Amalner. Premji had set up a team of bright young people (heads of departments were around 28 years old) with intellect and enthusiasm but no experience. The company was going downhill and Premji had to change the leadership twice in two years before he zeroed in on a general manager who delivered. He was 37 years old and we were cynical about an "old" guy leading a young team. Premji kept his cool, though I could sense how tense he was, and the initial failure was transformed into a very successful turnaround.
Lesson four is about humility. I can not remember a special display of "humility" but Premji did not have any "airs" about him and we generally felt comfortable working with him and even invited him over to dinner occasionally. He was perhaps the richest Indian even in those days, but he lived very simply — the Amalner guest house was pretty sparsely equipped.
Premji certainly strove for excellence. When he set targets for the annual plan we would think he was just being pushy, but the general manager who joined after the two unsuccessful ones, was able to deliver each of these ambitious targets and more. Lesson five (striving for excellence) was evident everywhere in Amalner.
The sixth lesson (don't give up in the face of adversity) brings to mind something of which I have no personal knowledge but have heard from friends. Wipro Finance lost Rs 120 crore in the early nineties when most other finance companies folded up. Premji, I am told, insisted on repaying every depositor and used his personal wealth to do it. He went beyond his legal obligations and stood firm in the face of adversity.
Reflecting on his eighth lesson (have faith in your ideas), I am struck by the thought that, way back in the 1980s, Premji could not have known the world will go the way it has with the opening up of the global economy. But he had vision and obviously believed in his ideas and was able to translate them into a resounding success.
No comments:
Post a Comment