| Research and practice
The man who gave professional management (and management education) the standing it has enjoyed for so many years died last month at the age of 93. Prakash Tandon epitomized all that is good about professional management.
Till the Seventies, management was inferior to government service as preferred employment. Prakash Tandon was the rare exception who went to England in the Thirties to qualify as a chartered accountant. On returning to India he joined Hindustan Lever Limited as a manager. He never practised as an accountant. He was among the first professional managers in India in a multi-national company, perhaps the first to work on market research, practise marketing management, develop brands, integrate corporate strategy with an understanding of the economy, society, government policy and the future and to write about the changes that he had witnessed.
Professional managers are not owners. Owner managers may have had education, training and experience but their interest as owners is first, not that of all stakeholders. Tandon, as the first Indian chairman of Hindustan Lever, once told shareholders at an annual general meeting that he owned no shares in their company and they could therefore expect him to safeguard their long-term interest without being diverted by his own interest. He bought shares in the company only after he left it.
Officers of the Indian Civil Service and its successor services were so versatile that many also became distinguished scholars and writers. But professional management in India by contrast has produced few such versatile individuals. That is so even in the last thirty years when the best brains took their postgraduate degrees in management. Tandon was one of the few exceptions. He made a mark as a manager, educationist, policy-maker, research chief, sociologist and eminent writer. We must wonder why management education after forty years is yet to produce Prakash Tandons.
Tandon started in Lever in market research and established the discipline (so that Lever rarely took a product or market decision without the backing of market research). Almost every company today follows this discipline. He was the first Indian marketing manager for hydrogenated vegetable oil (vanaspati) and established it as a substitute for ghee by using many novel techniques to propagate its use. He had puppets and minstrels wandering the small towns and villages propagating the virtues of Dalda. In Rajasthan he used the pichwai that wandering storytellers used to entrance audiences with the story of the Ramayana to tell the story of Dalda. He had men with folding tables and kerosene stoves go to village haats to cook dishes with Dalda and sample the food to convince everyone that the taste was no different from dishes cooked in ghee but at less than half the cost. Dalda became the first national and purely Indian brand and a generic word for vanaspati.
As the first Indian chairman of Hindustan Lever from 1960, he charted new directions into agro-industry. For a population so dependent on agriculture, this could expand earnings. But it was also good corporate strategy. By putting resources in the most vital sector, the foreign shareholders, Unilever, could retain their dominant shareholding when other multi-national companies were compelled to dilute foreign shareholding to 40 per cent. He and K.S. Basu created the Hindustan Lever management trainee programme, imitated later by most organizations. It gave Hindustan Lever a continuous inflow of highly talented young people, and almost spawned a 'Lever Old Boys' Club'.
By persuading Unilever to set up a full-fledged research centre in Bombay in the early Sixties, he helped make Hindustan Lever into a powerhouse of innovation, product development, process improvement and cost reduction. Hindustan Lever R&D became a very significant part of the worldwide Unilever network of research laboratories. Tandon started forty years ago a process that has since seen a rush of foreign companies in the Nineties taking advantage of the immense and low cost competence of Indian scientists and technologists.
If Narayanamurthy is an icon of good corporate governance today, Tandon set the standards for good corporate governance in the Sixties. Hindustan Lever developed the image under him of a company that was transparent in its disclosures, consistently rewarding its shareholders with dividends and capital appreciation and that it was a law-abiding corporate citizen that never did underhand things. His greatest achievement as the first Indian manager in this multinational company was to demonstrate that he could remain a nationalistic Indian when working for a foreign company in a 'socialistic' country.
He was the first top executive from a private and foreign company to join the public sector. As chairman of State Trading Corporation, he set high standards of professional management and corporate governance. Announcing performance and results at the end of each quarter, an up-to-date management information system, performance evaluation and management development and regular briefing of the owner as represented by the minister and secretary were some of his innovations. Few public sector companies even today do as much. He carried this professional management approach to banking when he was appointed chairman of Punjab National Bank. His contribution was in systematizing the management of human resources through training and long-term succession planning. At the National Council of Applied Economic Research, he started to encourage the private sector in using economic forecasting and applied research (which he had introduced much earlier in Hindustan Lever).
He was also active in national policymaking for government. His name was synonymous with the then famous 'Tandon Committee norms' for management of working capital. These contributed significantly to better management of working capital at a time when interest rates were in double digits.
As chairman of IIM Ahmedabad, he applied the same professional management and governance skills. Despite erratic governance and management at times, the traditions Tandon set helped IIMA remain a world-class brand.
Beyond management and governance, education, national policy formulation and research, he developed into an insightful sociologist through his three books brought together as the Punjab Trilogy. They were about transformation of a life (his own) as it dealt with dramatic changes.
The amazing thing about him all his life was his conscious and continuing attempt at self-development. As director and then chairman of Hindustan Lever, he invested time in regular meetings with top economists, intellectuals and policy-makers. As a result he was well informed about how the government was thinking and of the likely changes in its thinking. His insights developed the trust of his British bosses in the judgment of their first Indian CEO and hence in the ones that followed him. He made notes wherever he went, an endearing practice even in his eighties when he was a regular at the India International Centre in Delhi. Tandon frequently referred to and quoted from his notes.
He read voraciously but was hesitant, particularly as he grew older, to push his ideas on people. After he ceased to hold executive positions, he also stopped judging people. Instead, he would refrain from comment unless he had something positive to say about a person.
Despite his achievements he remained to the end a decent, wise and courteous listener. He introduced into Lever the culture of non-ostentation that he applied to himself. Today's professional managers appear to be losing this culture, very necessary in a country of such social and economic contrasts. He is an example for all of how much change a person can manage effectively in his life.