Strewn with Anachronisms,

Indian Management Scenario

Continued from “A Metamorphosis that Was”

Managers Galore – Part VII

After the legendary Bourbons, we Indians are perhaps the only people who excel in the art and craft of refusing to learn anything new or unlearn a thing that we once had been tutored in. If you’ve any reservation in accepting my contention, look at the way we manage not just our industry but the whole spectrum of organizations in our social, economic and political life.

As Fordism Unfolded

Historically, adoption of Fordism changed the very nature of work and how we do it. It is, for instance, an amazing fact of our times that we all work together in organizations. Now it is the organization that produces and not the individual. This indeed is an historic change, the real meaning and implications of which have not as yet been grasped in our society. Even if a pair of hands might have polished for hours a cake of Pears soap, I buy a Lever product. The hamburger you and I eat is not prepared by a cook but a whole chain of people involved in well-defined sub-roles.

Again, despite sweeping developments to the contrary, the assumption that Management is Business Management still persists in our society. It is therefore important to assert – loud and clear – that management isn’t business management any more just as medicine is not obstetrics. We know for certain now that there can be management of business enterprises as well as management of NGOs, hospitals, government agencies, banks, and any other organization. Again, management is not restricted to these institutions only. It may be management of ourselves and our mind, of time at our disposal, of everyday life as well. Perhaps the most insightful observations of Peter Drucker were in areas of self-development and self-management. Management is after all an organized common sense. The science and art of performing a thing productively with maximum utilization of resources is management. It has to be applied to every walk of life, just as Vivekananda reiterated that Vedanta has to be applied to all situations and fields of life.

What has been the impact of these far-reaching developments on our society? Despite all the modernistic imported trappings we parade, the Indian management scene doesn’t add up, on the whole, to a cheerful, hope-inspiring picture. In fact, what goes under the nomenclature of management in an average industrial unit in our country is a combination of some hopelessly outmoded British practices which (as intellectual slaves of the British legacy) we stubbornly cling on to, and some home-spun theories rooted in practical reality and makeshift policies. That the British paid a formidably stiff price for what they practiced as management, is borne out by the ignominious end of most British industries, the crowning irony of which was the takeover of the terminally sick Rolls Royce – once deemed as the brightest feather in John Bull’s cap – by the post-war German industry.

What should we do to evolve an indigenous style and ethos of management to catch up with the world, is a question we must address ourselves to in dead seriousness.

All said, management is a matter of practice (or rather a set of practices) rooted in a given culture but conditioned by our response to the situational challenge as we perceive it. That is how it evolved. It is pertinent to recall that one of the very first standard texts on the theme of management was The Practice of Management in 1954 by Drucker.

Grey Patches

The inadequacies of our management scene must be viewed in the backdrop of the trends and techniques thrown up in the post-Fordism phase both in the West, especially in the United States, and in the last few decades in Japan and the Asian tiger economies and then again in the West in response to the Tigers’ challenge. Many indeed are the ills afflicting the management of Indian industry.

A vast majority of our industrial organizations haven't had so far even the full impact of scientific management symbolized by Taylorism. And to that extent we are almost a century behind others in the matter of techniques regulating output as they obtain in the industrialized world. Take, for instance, the Ordnance Factories of India – an example that I am citing advisedly. Ordnance-producing units in America were the pioneers in introducing scientific management techniques advocated by Taylor. Drucker, for example, points out in Management Challenges for The 21st Century that what goes under the nomenclature of many a modern management practice began in Government-run Watertown Arsenal of the US Army.

In our case, the Cossipore Ordnance Factory, established in the northern suburbs of Kolkata, in 1801 as Gun and Shell Factory, was one of the very first industrial units in the country (Today, it represents a relic of a bygone age). Over the years, as other similar units came up to manufacture war material for the British forces (in their empire-building campaigns in India), some production guidelines were formulated to ensure a minimum output per worker. These guidelines have remained substantially unchanged over two centuries. How unscientific the production parameters are as they obtain today, is proved by the fact that each worker after doing the day’s work quota can earn additional income up to 75 per cent of his minimum wage. And all this within his scheduled working hours! (Interestingly, this extra income is called profit. I don’t know how the term originated nor the justification of the nomenclature). Any output over and above the agreed minimum has to be paid for as overtime. Overtime payment, in fact, in the Indian industry is a racket of Himalayan proportions. Since the stakes are too deep and widespread, the practice continues to thrive. (I saw once the enclosure, listing emoluments of the employees over the statutory limit in West Bengal State Electricity Board’s Annual Report. The total income, including overtime, of a couple of car drivers was more than that of the Chairman of the Board.)

Working in industry gave me the opportunity to have a close look at how its wheels chug along creakingly, the noise of which we have learned to smother behind borrowed sophisticated veneers. Here’re some salient characteristics of our management culture – characteristics which, if not corrected at the earliest will perpetuate India’s status as a third-rate economic power. These characteristics, in fact, are the numerous bars of the cage holding the Indian economic tiger – cribbed and confined.

Deep Distrust

The system of management that the British created to serve their imperial interests in India was based on deep distrust. Their penchant for “divide and rule” completely eliminated the possibility of trust in anyone (There are no available records of the true impressions that they had of their Indian subjects whom they must have regarded as morally decrepit and hence, utterly untrustworthy). Take the example of ordnance factories that I referred to above. Those employed in them were viewed with profound distrust bordering on covert suspicion. When at the end of the shifts workers employed therein left, they were subjected to thorough body search. (Even today after sixty-five years of our Independence, the standing orders guiding security operations of these establishments still lay down that at least ten per cent of workers leaving at the end of each shift must be subjected to thorough body search and their names noted in a register).

The message to the workforce was – and it continues to be – “you aren’t trustworthy”. And if you reinforce this message day after day, how can a management expect commitment from its workforce? Trust and commitment, today, are deemed as the necessary ingredients of industrial culture, and these, unfortunately, were absent from the legacy of the British management practices that we inherited after Independence and continue with.

This culture of distrust didn’t end with the workers. Those called upon to manage these units weren’t trusted either. Each one of them was posted in a given establishment for a couple of years and then shifted lest he should conspire against His/Her Majesty’s Government or start lining his pockets after he had had time enough to cultivate the suppliers. Much to the detriment of efficiency, this transfer policy continues. Its declared justification is to help managers acquire diverse experience. The real reason is to build a culture of compliance, which is the antithesis of empowerment – the hallmark of modern industrial culture.

Distrust was (and still is) most pronounced in Government establishments, especially in the area of finance. Wherever the ‘outflow’ of money was involved, the system ensured that no one was to be trusted. There must be checks and counter-checks. An account payee cheque beyond a certain amount must be sent by registered post only. Cheques should be handed over in the august ‘presence’ of the highest factory functionary so that there was a most reliable witness to the fact that a crossed a/c payee cheque on RBI issued against a pre-receipted bill in triplicate was duly handed over (There must have been a time when the thumb impression of the recipient of payment was also certified along with his signature by half a dozen witnesses).

The system threw up, unwittingly, a privileged class i.e., those who dealt with finance. They were the custodians of financial resources who must keep a vigil over everyone else. Anyone whose work has brought him in contact with Government agencies knows how vital is it for his work to have the right contacts in the accounts department where it’s now de rigueur to charge a certain percentage for releasing payments (Invariably, firms dealing with Government departments debit such payments under the head ‘transport’. It does indeed deal with movement).The British must have had their imperial compulsions to design the systems that they did. After all, they were the rulers.

What, you may wonder, is the justification for the continuation of the system decades after Independence? Unfortunately, once a system is in place, vested interests ensure its continuation. Why should we expect the finance departments of the Government of India undertakings to let someone slaughter the goose that lays the golden egg for them?

Managerial practices emerge in response to the needs of time. Also, they are in consonance with the mores of the then obtaining social system. When the time changes, these practices need to be reviewed and amended. There are occasions when they must be even altogether scrapped, if deemed anachronistic. The greatest tragedy of our administration and managerial systems is that at no stage after Independence did we undertake a serious exercise to review our systems with a view to making them attuned to the needs of those they were designed to serve and, thereby, dismantle the dependency culture. Now and then we do make feeble noises about the administrative imperatives of the twenty-first century, but no action is ever taken. Tomorrow’s electronic information highways can’t be negotiated through the labyrinth of the culture of notes designed for a multi-layered bureaucracy. At no stage did we attempt to purge the system of the distortions we inherited from an imperial past to evolve a system of management suited to our conditions and our cultural ethos to serve the interest of our society.

Security and Status

Among all the attributes of Indian managers, security and status stand out as the two predominant traits. A typical Indian manager doesn’t at all possess the qualities that characterize an entrepreneur. What he wants is a secure job – job that gives him thirty odd years of working life with all possible benefits thrown in besides periodic automatic promotions. An average Indian manager won’t like to take a risk with his job. That explains the craving on the part of educated Indian youth to somehow get into Government service.

It is only the young from professional middle class families who venture out in professions like accountancy, architecture and engineering. Indeed, there has been in the past decade a rush for berths in business houses. Even though such openings didn’t offer the security guaranteed by Government service, the attraction of handsome pay packets, especially by the MNCs was irresistible. (However, the number of those who went for risk-prone, challenging but well-rewarded careers in the world of industry, is small indeed compared to the number of security-seekers. Hence, the preference for the cozy comfort of the golden cage).

The second common attribute of our management style is status. It is true no society is without its status concerns. However, in our case, it is obsessive. In my day, there was, in the company I started my career with, a President at the top (God alone knows why and when American executive nomenclatures were introduced in India). There were a couple of Vice Presidents under him. Then one day one of them got promoted as Executive Vice President. (I still don’t know why). Now the same Company has three Executive Vice Presidents and half a dozen Vice Presidents, each one of whom has a couple of Assistant Vice Presidents reporting to him. Lo and behold, there are three Presidents above whom is a Senior President. Hierarchical levels are being added to by the day in our organizations to satisfy the status craving of executive cadres. The world over, on the other hand, organizational structures are getting flattened by eliminating most of the intermediate level positions to make companies shed fat and look trim.

Personnel Function

Another bane of Indian industry is that we haven’t as yet evolved the crucially important role of personnel department. More often than not, the one role most personnel departments are busy with (almost all the time) is management of industrial relations which invariably means keeping the labor unions – or rather their leadershappy to avoid disruption of work through “go-slow” and several other devices just short of work stoppage. Consequently, the more important functions of the personnel department are largely – in many cases completely – neglected. If and when something else is attended to, it is only when a crisis surfaces.

Even in organizations where the crucial part of the personnel function, namely, human resource development is paid attention to, the emphasis is often misplaced. Most of the training that managers, supervisors – and in rare cases workers – are exposed to, is in the area of skills. It is important but not enough unless some dent is made in the area of attitudes. If both the managers and workers are firm believers in adversarial roles, i.e. think in terms of we-vs-they, no amount of skill training can be of much use to the organization. It may only hone their skills to play games. (In matters of management training, the middle levels are over-exposed which overexposure breeds cynicism amongst them.) The top echelons who need the most to update their skills (and, more importantly, their perceptions) the most, deem themselves to be beyond the need of any training?

One of the reasons for the continuation of this deplorable state of affairs is the powerful influence that politically-backed labor unions wield in the organized industry. Since they can hold the society to ransom, no one dare challenge the existing arrangement. Most of our PSUs and Government-run industrial units have, consequently, reduced themselves to the status of organizations which subsist merely to cater to the interests of their inner constituents alone, not unoften at the cost of the outer, and far more important, constituents (namely, customers).

Continued to “Organizational Dropsy: Dreaded Disease of Organizations” 

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More by :  H.N. Bali

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Views: 3419      Comments: 1

Comment You have addressed virtually all the outstanding issues facing us in Management.. We, Indians are superb in emphasizing and achieving academic skills. While these skills are important, they are only part of the human development process. I will list some of these competencies below:
1. Academic
2. Interpersonal
3. Social
4. Emotional
5. Organizational
6. Entrepreneurial
7. Environmental
8. Financial
9. Legal
10. Spiritual (seeing every co-worker like yourself and understanding their aspirations)

These are only a few. If we draw a 360 degree diagram of these competencies with the length of the spokes representing the level of these skills, the resulting wheel (also called the wheel of Human Excellence) needs to be fairly round to allow smooth progress. An ideal well rounded competent manager has the largest possible diameter perfectly rounded wheel. The aim of the journey of life is to continuously strive to achieve it.

The principal objective of the academic competence is to make us learn how to learn. Most of the learning in life is achieved (if we abide by it) after the academic phase.

Our problem is that our education system is not geared to provide our young minds the exposure to each of these competencies during their academic life. It needs to be continuously re-engineered to face the challenges of our times.

18-Mar-2015 01:54 AM

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