India has many examples of highly effective entrepreneurs. They are not confined to profit-making businesses but include not-for-profit organizations as well. Leaders of such organizations appear to share some common qualities.
In a study of “winning” Indian companies in a recent book, Passion to Win, Abad Ahmed and O.P. Chopra have written the first Indian equivalent of the famous 1982 study of excellently performing companies in the United States of America by Peters and Waterman. Unlike that book, the Indian research was modestly funded. The authors have brought out features that might explain the “winning” abilities of selected companies. Some of the companies studied are best performers, many are lower down, although all have done well and make good profits. The book brings out the unique characteristics of these successful companies operating in India.
Leadership is a key factor in winning. The vision, values, focus, humility and wisdom of the leader permeate the organization. In all the companies studied, the chief executive officers have most of these qualities. But all of them have a passion to win, not by destroying competition but by being better. In India also, these companies “were guided by an overarching and compelling purpose and vision”. They would not compromise their distinct values for any gain.
Another characteristic feature of the leaders of all such organizations is presented in the words of Brij Mohan Munjal, the head of Hero Motors, the fastest growing two-wheeler company that now dominates the Indian market in sales and profit. “If you follow your shadow (i.e. false glory), it will run ahead of you; if you have your aim and goal towards light, towards truth, the shadow (fame and glory) will follow you.” As the authors say about the leaders of such winning organizations: “The(ir) low profile of humility was combined with great ambition for the organization.” They analyse in detail the organizational attributes that seem to make winning companies — leadership, strategy, process-driven implementation, relationships and culture.
Even in the public sector there are examples like that of V. Krishnamurthy, who has all the characteristics described in the book. He made Bharat Heavy Electricals Limited, Steel Authority of India Limited and Maruti into winning companies that remained so for long after he had left them. “Winning” leaders in all types of organizations have many common characteristics. The few organizations that I mention here are among many that are varied in ownership and fields of activity. What is common is the passion and commitment of leaders with values that reach out towards larger societal goals.
Yogendra, a student union leader, and others started the Bodh Shiksha Samiti (also supported by the Aga Khan Foundation) in 1987. He realized that the schooling of poor children required total involvement of the community in the governance of the school and a sense of ownership of the school by the community. It started with school dropouts from among slum children in Jaipur and has now extended to urban and the poorest rural children in parts of Rajasthan. Bodh also lends its experience to 20 non-governmental organizations in similar efforts in Madhya Pradesh, Uttar Pradesh and Rajasthan. Bodh itself now runs 389 schools with 54,000 children and 830 teachers. It works closely with teachers of government schools and government resource centres as well to bring about community involvement in their governance.
The teachers are graduates and belong to the same locality and socio-economic class. The teaching aids are designed and made by the teachers themselves, since they are familiar with the cultural and social background of the children. They receive three months of intensive residential training followed by weekly review meetings and monthly refresher training. There is regular contact between teachers and the mostly illiterate parents. Bodh schools are started only at the invitation of the community which gives the space. The founders’ passion to give opportunity to the most deprived in society has led to a transformation in many children’s lives.
Radha Daga is a Marwari woman who, fifteen years ago, ventured into garment manufacture for export, with little knowledge of fabrics and their tailoring. From a small factory in Chennai she has built a very well-designed garment factory. She had two value drivers: supply the best quality products and provide dignity and gainful employment to poor village folk, especially women. She has succeeded admirably. The factory has rigid inspection standards. Her workers and many quality inspectors are well-trained and Radha herself makes frequent inspections. She also has the most modern equipment to ensure zero defects. She says: “It costs a little bit more but I do not have to worry about sending any sub-standard product.” She has customers from all over the world and makes a good return on investment.
Her passion comes out when she talks about her workers. Peasant girls, who did not have lunch to bring when they first came to work and wore the same clothes till the end of the week, now eat well and are well dressed. She has encouraged them to practise family planning. By giving regular bonuses and a small share in profits she has helped them to save. Radha’s passion has made skilled workers out of the poorest from surrounding villages.
Another example of a leader who acts on concern for the livelihoods of the very poor without giving them doles is K.M. Thiagarajan. Scion of a famous Chettiar family and a PhD in organizational behaviour, he was chairman of the Bank of Madurai. He transformed it into a nationally competitive bank eventually bought up by the ICICI. Thiagarajan’s concern for the betterment of poor rural women led him to start rural women’s self-help groups in the Bank of Madurai. They became part of the Micro Credit Foundation run with loans from the ICICI. The foundation is perhaps the largest of its kind in India and has less than 0.5 per cent defaulting borrowers. It has significantly improved the livelihoods of rural women in the seven districts of Tamil Nadu in which it works.
The significant feature of the MCF is the multiplier effect as women participants help others start similar groups. But like Thiagarajan, MCF also has a very low profile and concentrates on its work. Few know about its work or of Thiagarajan’s innovative leadership and almost messiah-like image among his borrowers. He and the MCF are highly focussed and passionate about supporting poor women to engage in regular income-earning livelihoods, but as a profitable activity, not as charity. Today, many banks see women’s self-help groups as a worthwhile and profitable activity.
In the vastness of India, these examples of people who have put their energies and passions into developing institutions and organizations that serve larger social purposes while not engaging in charity, are only some among many. The people who founded them and gave their time to run them are as much entrepreneurs as the businessmen that Abad Ahmed and Chopra study in their book.
The expanding role given by government and funding agencies to NGOs for rural development, poverty alleviation, health, education, nutrition and consciousness-raising programmes makes their leadership and methods of working of paramount importance. Entrepreneurial idealists, who want to make a difference and change society for the better, founded many of them. But most lack training in keeping accounts, systems, marketing, report-writing and in the applicable laws. Receiving funds from more than one agency, they tend to be very secretive and cautious in giving out information.
One has to worry about their sustainability when the charismatic and passionate founders have passed on. Like many companies, there are many NGOs and non-profit organizations that go to seed after their founder has left. These organizations must receive training in organizational sustainability and research. Training and educational institutions must put their energies into developing them.