Archive for the ‘Anticipating Change’ Category

The End of Middle Managers

Came across this very interesting and startling article in The Economist.

Pls see: http://www.economist.com/blogs/schumpeter/2011/08/middle-managers&fsrc=nwl

Makes some interesting bunch of points.  Not all well substantiated.

1.  Middle managers i.e. generalists who will solve issues from first principles, are a disappearing lot. Not so sure of that.

2. Motivation of an employee is based on the immediate superior and not the CEO.  The biggest demotivator is also the boss and not the organisation.  This I agree with.

3. CEOs have a grandiose self-image that is quite unsubstantiated by their performance.  Not surprising.

4. Instead of Management, “Leadership” is the new fad.  A dig at coaches like me 🙂

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Life Is Unfair!

Vijay Kasliwal is head of Supply Chain Management at Shaw & Bradley (S&B) a large manufacturer of industrial tools.   In his early fifties, Vijay had been with S&B for the last 30 years.  By 2002, Vijay rose to become the plant manager at S&B’s largest plant, accounting for 60% of the production by value.

Vijay was regarded as an ace within S&B.  He could troubleshoot any technical problem.  He was a great leader. His juniors and workers revered him. Even the union leaders grudgingly accepted his influence.  He was a hard driver and was always on target.  He loved his job and he felt in complete control.

S&B was founded in the 1960s by Gaganseth Khandelwal.  He built the business, piece by precious piece, through sheer dedication, hard work and keen business acumen.  S&B has a reputation for quality and clean business practices. It’s a much admired company and a well known brand.  Khandelwal was known to be people oriented, and his son continued that tradition.  Employees were usually well taken care of.  Work culture was highly relationship-driven.  It mattered how close to the owner you were.  There were fiefdoms everywhere.

Through the 80s and 90s, S&B grew steadily but growth was not spectacular.  In 2003, the company passed hands to the grandson Rishabh.  In an economic environment where other businesses were growing rapidly, Rishabh was not satisfied with S&B’s achievements.  A flurry of acquisitions followed.  Most of them were ill-planned and failed.  In 2009, for the first time in its history, S&B declared a substantial loss.

There was a shakeup. A well known consultant was called in to “rationalize” the group’s businesses.  It was time to focus back on the core business – industrial tools.

Short of cash, the company decided to pursue growth without adding capacity.  Outsourcing became the new mantra.  In order to implement its strategy of aggressive outsourcing, Vijay was invited to head the newly created Supply Chain Management (SCM) function. “Supply Chain” not just “in house manufacturing” will be the new core competence, announced the CEO.  And who better to deliver than Vijay.  It seemed a perfect fit.

Vijay was under tremendous pressure to quickly put in place SCM processes, identify suppliers, negotiate prices, co-ordinate production of three plants, and setup a new warehouse all at the same time!

Things began to fall apart soon after. In late 2010, I got a desperate call from Vijay.  “I am calling from Shanghai. Things are in a mess. I need help! And fast! I want to meet you as soon as I return to Mumbai”

When we meet, Vijay seemed anything but in control.  Gone was the confident demeanor. It seemed like he hadn’t slept in days.

It took me a couple of meetings to figure out what was going on.

Vijay was used to a “command-and-control” style that worked very well for him as plant manager.  He would drive his reports and they would respond accordingly.   Only those who took orders well ever survived under him.

“But now, nothing is in my control.  The plant managers don’t report to me.  Suppliers are playing their own games. They take our orders and deliver them elsewhere.  Chinese suppliers are interested, but our orders are small for them. Besides I need to ramp up their share gradually.  I am responsible for finished goods inventory at the warehouse but have no control on what is sold.  How am I expected to manage?

What came to light was a startling revelation.  Vijay was unsuited to the task at hand.  Nobody noticed that the new role required a fundamental change in his leadership style.  It needed him to learn some completely new skills.

Instead of control, he needed to exercise influence over various stakeholders.  He needed to communicate to a diverse set of functions none of whom reported to him. He needed to orchestrate a complex chain of processes from Shanghai to Surat – most of them were outside his plant.  Actually he needed to demonstrate extraordinary leadership that would knit together various departments that were thus far working in silos.  Nobody in the organization had recognized this.  What was expected of him was extraordinary organisational change.

“Life is unfair!” complained Vijay.  I wanted to say “Yes, there is a lot of that going around.  Get used to it Vijay!”  Instead, I asked him, “How badly do you want to make this succeed? Are you willing to do what it takes?”

I Missed My Promotion

Malhar was trying very hard to hold back his tears, and failing.  When he told me a couple of hours earlier that he wanted to meet me, I knew something was wrong.

Nevertheless, I was not prepared for what I saw.  How did this aggressive, confident, hard driving guy with an “I-can-take-on-the-world” attitude, turn up like this?

“It’s not fair” he cried.  “I have done everything they told me to. I even moved away from my family to the headquarters, just so that I would not hurt my career.  God! This is my life! What will happen to me?”

Asst. Vice President, HR at Parsley Infotech,  Malhar had grown up through sheer dint of hard work.  He was known for his recruitment skills.  As Head of Recruitment, he would always meet his targets.  He could drive his team very hard.  But they never complained.  He would be there in the trenches with them.  He was there when they needed help. He was an ace troubleshooter.

Three years ago, Parsley re-organised itself into business units (BU) as per client’s industry.  Malhar was made AVP, HR for the Retail BU.  His boss told him “Once you show your worth we will make to Head, HR of the Retail BU.  Till then that spot will be left vacant for you. “

Malhar’s dreams were beginning to take shape. In the software services business, head count was everything.  The head of the business and the delivery managers constantly talked to him to meet their number targets.  The Retail BU grew rapidly and now accounted for 40% of Parsley’s business. Sure enough it now had the attention of  the CEO, Group HR  and Head of Sales.  Malhar was in high circles.

Then came the slowdown of 2008.  The BU was frantically trying to keep up the bottomline.  HR was no longer about increasing head count.  Malhar was expected to mange discontent within the BU;  troubleshoot people problems for project managers.  Top management wanted crisp presentations with ideas on how to bring down costs.  They wanted strategic inputs from HR.  They needed Malhar to communicate to them on what mattered.

They found Malhar woefully inadequate.

Malhar could sense that the body language of company seniors had changed.  He did what he knew best.  Work harder at recruitment.  But nobody was impressed.

When the industry revived in 2010, Parsley got back to growing.  The Retail BU that he built from scratch, would now have a new VP, HR.  Malhar was given the bad news at his interview.

What happened?

Malhar was required understand his role afresh.  He needed a completely different approach, and new skills.  He needed to understand the business of software services.  He needed to contribute new HR ideas – not just report on head count numbers and attrition rates. He needed to make his point to top management in 5 minutes.

Nobody told him that.  Neither did he figure out.

Parsley had moved on.  Malhar was left behind.