Tuesday 13 October 2009

A 1985 interview with LRB....

This interview was conducted by a group of participants of the Management Development Programme in 1985 for the farewell issue of 'weekly jargon', their newsletter. This interview was conducted by Aradhana Chinubhai, Bala , Praveen Aggarwal, and Arun Bakliwal.

The goodbye jargon has an interview with Prof. Bhandari. All of us agree that he is a truly amazing man, to have achieved so much at so young an age. What really endeared him to those of us who interviewed him was the deep concern he has for the nation. India being classified as a developing (or under-developing) country seems to have wounded his pride. And the best part is that he is doing something about it. Like perhaps our new Prime Minister, though Prof. Bhandari doesn't think that all that the new Prime Minister does is good for the country. We are proud of having been associated with you, sir.   

WJ: Could you tell us something about your early life?

LRB: For the last nearly 20 years, I have been associated with this institute (IIMA). I came here as student in 1965; I joined as a PGP. Before that, I studied in Jodhpur for my graduation. Did my bachelor’s degree in the humanities. After my PGP, I worked in Hindustan Lever for 5 years. Then, I decided to go back to school. I spent 6 months at the institute before going to the United States for my Ph.D. Returned in 1976 and have been here ever since.

WJ: What made you leave Levers?

LRB: I didn’t leave to leave Levers. I left to go back to school and do my doctoral studies. I was interested in doing my doctoral studies even when I was a student here. The Institute was also keen that I pursue academics. I joined Levers only to get some experience in the real world. I would have worked there a year or two more, but they were planning to send me abroad for 2 years to work in their parent company in the United Kingdom. Then I would have been morally obliged to work with them for some more time. I would not then have been able to pursue my doctoral studies. I used that opportunity to make my decision.

WJ: Which University was this?

LRB: I studied at Columbia University, New York City at the Management school.

WJ: What was the subject of your thesis?

LRB: I wrote my doctorate in Social Marketing. In the American Universities, this is only a small part of doctoral study unlike here and in Britain. It was a good experience. The management field had been growing quite fast in those years. Development was so fast that in the 5 years I was at HLL, things had so much that it was well worth going through the courses again. Updating oneself all over again. I wouldn’t mind going to school once again, even now.

WJ: This is a question we are fond of asking. Is there a difference in teaching style when you were a student and now in the last 2-3 years?

LRB: It’s a little difficult to answer that. Many of us now see only a small part of what goes on. And that too only what we do. Perhaps a student would be able to answer that better. I can only give you my experience. There is a difference, certainly. The difference is primarily in the change in the mix of methods. In early years, the Institute believed in the case method so much that there were absolutely no lectures by faculty. Even Accounting and Economics were taught by the case method. That obviously has changed over the years. There is a fair mix of methodology now. Also, the diversity of the faculty in terms of their own training and their own orientation reflects itself in the teaching styles. Even the treatment of the case method is not as uniform as it used to be. In the early years, the entire faculty had gone through a kind of training at Harvard Business School and all of them had gone through the training within the same 2-3 year period. So, all of them had been painted in the same colours and all practiced the same ethos. That way, things are different. There is diversity.

WJ: Why did you choose marketing as your special subject?

LRB: It was a combination of things. The choice was made when I graduated from here and started working. At that time, I seriously considered two options – Marketing and Personnel. I did not consider two other areas in which I was greatly interested, namely Manufacturing and Finance. I ruled out those two because when one is looking at a career in business or industry, I figured that the fact that I am neither an engineer nor an accountant by training would come in the way of my career growth in the long run. I was quite interested in the Personnel area. Again, it was a combination of things that drove the final choice. I felt that the Marketing field provided more challenges for the practicing manger. It was also partly influenced by the organisation I chose to work in. The final choice was between two companies – Hindustan Lever and Metal Box. Metal Box was quite keen that I join the Personnel stream and Levers was quite keen that I join the Marketing stream. Basically, I made my choice of the organisation and the stream followed. Having spent 5 years as a practising manager, I chose to do my PhD in that field. Not a very rational way of making a decision, I admit.

WJ: Being amongst the first few MBA’s in the country, was there any resistance when you joined the company?

LRB: Yes, there was severe resistance. There were resistance on two counts. First, they felt that we (MBAs), may pose a threat in the future to the non-MBAs, especially the younger people. Secondly, with the MBA entry there was a possibility of a cultural change in the kind of people who belonged to the so-called covenanted management group. Earlier, they used to recruit people to the covenanted cadre from Universities that belonged to the establishment. A lot of the Oxbridge type. A fair amount of St. Stephen’s, St. Xavier’s and Loyola College, Madras. But preponderantly Oxbridge and St. Stephens. Surprisingly, there were hardly any American MBA’s – Indians educated in the USA. England, of course, did not have any management schools then. They are quite backward in this. Their schools are hardly 10 years old. Outside the US and Canada, India was perhaps the first country to launch formal management education. So, there was this cultural change of people like me who did not have any convent school background entering the portals of a company like Hindustan Lever. This was the cause of the resistance.

WJ: What was the kind of the resistance you encountered?

LRB: It reflected initially more in terms of social resistance than work related. I don’t think it made much of a difference. Because the induction of MBA’s into Levers was done with the support of top management. The chairman of Levers was then also the chairman of IIMA. So everybody in the company knew that these people are coming with the support of top management. The resistance disappeared because the others found that the MBA’s talked the language of business and knew more about the other functions. In marketing, most people could not read the Balance sheet.

WJ: You experienced both teaching and a career in industry. Which do you prefer?

LRB: Both.

WJ: Why?

LRB: First of all, I like the diversity of work that such a combination offers. Secondly, I do not much like the routine administrative part of a practising manager’s job which is very important and if not well attended, the whole thing can go for a six. I don’t like that and I am not good at it. I can mess up a manager’s job fairly well as I lose interest in the follow up. But, I like the challenge of problem solving. Looking at problems, opportunities and so on. Teaching provides an opportunity to conceptualise some of these things, an opportunity to ride one’s hobby horse.

There is a very interesting pattern that I have observed. A lot of people who are supposedly good end up being good in their own field because they are able to establish a link between some other field and their own field. The inputs they bring from the other area often end up making them distinctive and perceived as more effective in their own field. If you have diverse interests and experiences, then it is possible for you to bring one into the other. You can be perceived as a good teacher because you bring the realities of life into teaching and to be perceived as a good manager or advisor because you are able to bring the ability to conceptualise from the academic field. This is truer in an applied field like marketing than say economics. It gives you an opportunity to learn at somebody else’s cost.

WJ: What companies come to you for advice? What are they really looking for?

LRB: I really don’t know (laughs). I wish they knew. Most of the time, I think they are not very clear. There are, I suppose, many diverse reasons. In my case, at least, I have found that most of them come not because they need any highly specialised kind of advice, like something they don’t know or cannot learn, and therefore have to come to a specialist.  Most of them come because they get tied down in a maze of issues, problems, considerations, and contextual concerns and cannot see through the problem clearly, and more importantly when they see through the problem what direction to seek. I think a major contribution that an advisor makes is that he or she is able to see things in a detached, dispassionate manner and provides clarity to the situation. And when one works in a variety of industries and situations, one’s ability to be an advisor also improves considerably.

WJ: Could you tell us something about your most outstanding assignment as an advisor? The one you liked the most?

LRB: One association, which has been particularly satisfying, is my association with Enfield, which is quite old now. Nearly 7 years now. This was a company in the dumps, shut down for quite some time, with massive accumulated losses. When the company was being reopened sometime in 1977-78, I joined the Board at the request of the Chairman of the company. I got deeply interested because the company was in deep trouble. They had wiped out their capital base 3 times over. This association has been a close one.

There was very little of marketing related inputs but it has been an overall corporate management advisory type of a role. We faced many crucial decisions that could make or mar the company. Fortunately, within 3 years, we could wipe out all the losses of the company and create surpluses. By this summer, I think the company’s reserves and surpluses would exceed 10 crores after wiping out all the earlier losses. Of which about Rs. 80 lakhs have been fresh issues and the rest internal generation. The company is now rapidly moving into a growth stage. They have already invested Rs. 30 crores in an expansion project with which I have been closely associated. A very satisfying experience.

WJ: What has been the nature of your contributions?

LRB: Very difficult to say. You could say that I was a sounding board for the company management for all decisions of a crucial nature. I served as a source for providing directions for some of the areas, which turned out to be critical for the company. I had also something to do with the culture of the company. When they reopened I had very little to contribute as regards the culture point of view, as they had already appointed people. They had a bunch of retired army people manning important functions of the company. They did a good job, I should say, putting the company back on the rails. But, it was pretty clear that this culture will not bring in future growth and will not be able to look at opportunities and tap them and will not be able to provide the cerebral inputs which a company needs in terms of strategy. In fact, in the last 7 years, the company has gone through a complete change twice over in terms of the type of people and the culture that existed. It was a family managed company earlier. There was this transition to the army culture and later to a very professional one. Now, professional management graduates handle all the important functions. People are very free and they frequently disagree with the Chairman and Managing Director, who is also the owner.

WJ: Do you do any international consultancy?

LRB: My international consultancy work has been of three kinds. I have worked at different times with international agencies on assignments in social marketing such as population, family planning; with international consultancies in management, training and development; and helping the other countries work out their strategies and programs. I am currently working for the Govt. of India on an international assignment for formulating and partly implementing an international strategy for marketing Indian tea. I have also done some work with some companies abroad earlier. While I was in New York as a student, I had done some work there. More to keep body and soul together.

WJ: What do you think is the state of professional management in India?

LRB: In terms of the totality of managers, the gap between those who have inputs to manage in a professional manner and those who have not is quite large. In terms of competence, by and large, the Indian manager is a very able manager. In that, he has a great deal of innate qualities – ie he is intelligent, committed to the job, etc. He has the individual abilities but come out low on effectiveness. There are two or three reasons for that. One is that, in our society on the whole and in our large systems like Govt., bureaucracy, etc. reward systems have always been and continue to be associated with ability rather than performance. We reward a person because he knows, not because he applies his knowledge, not because he has done good for the organisation. Our reward/punishment has not grown out of the school system. The emphasis is based on habits, abilities. They are required, but what happens is that the application of these to meeting an objective gets ignored. We also suffer from having a functional perspective as a nation and particularly as managers. The largest system, the Central Govt. is organised functionally and sectorally; ministry of this and that. The ability to work together suffers as a result. The health ministry will plan for something somewhere and the education ministry will plan for something elsewhere. Eventually, the people who are going to get the benefits (or not get the benefits) are individual entities – families or villages. The integration will have to be done by those entities. So is the case with the companies. Except the Finance director, nobody will know the cost of production of the company’s product. Even the Managing Director is not sure he knows. Thus the whole system becomes ineffective. I suspect it is the British who are to blame for this. Functions begin to operate as castes. They don’t function together. They are individual oriented and not task oriented. The Indian Manager suffers from some of these problems as well. That is why Indian Managers abroad come out extremely well.

WJ: What do you think of the Japanese Industry?

LRB: The Japanese industry has to be seen in the broader content of their society, tasks and ethos. I believe they are industrially successful because the nation as a whole made a conscious decision and backed it up with policy and action. In India, for various reasons, business is looked down upon. The Japanese also looked down upon business once upon a time. In the hierarchy of things, mercantile activities were something for lesser beings in society. The more honourable tasks were administering the economy and defending the nation. The sword was the symbol of respect. The Second World War changed that. After the surrender of the Japanese, and the explicit ban on the Japanese raising an army, resulted in a structural change.

Being the proud nation that they are, and to win back their pride and teach the world a lesson (which they have been doing for hundreds of years), they were looking for another way of conquering the world. And in this half of the twentieth century, what else was more appropriate than the economic way. This was manifest in the way the post war children in Japan were brought up and how the families defined the priorities for their children. If a man came back home at 6.00 pm, he will be given a dressing down by his wife, his mother because he is supposed to be doing his best so that his company succeeds. If he comes back early, he is certainly not doing his best. The labour union was also not asking for a larger share of a smaller cake. They were working to make the cake bigger so that they get a larger share in absolute terms. It is this that underlies the success of the Japanese industry. The Japanese system of decision-making or the Kanban system of assembly line operations – the contribution was there but it was only marginal. Also, they had a much clearer vision of world industrial trends. They chose as a country, not as individual companies, priority industries and said we will be number one. They tailored everything accordingly – financial policies, government policies, etc. to ensure success. That worked. They are now pulling out of industries, which are declining. And very methodically. The resulting unemployment problem is being solved by re-training. The unions are co-operating in finding ways and means in rehabilitating people. Like in steel. They have decided to reduce capacity by half because steel is a declining industry. They are concentrating on new growth areas. That is the national ethos. If India were to do this, I am sure we can succeed too. We have the basic resources. What we don’t have is the commitment. And more than that the clarity of vision of what we would be doing.

WJ: You had earlier said that India has a very sectoral type of government organisation, which is hampering growth and effectiveness. What is your alternate recommendation?

LRB: Let’s not get into that. I don’t think I have enough knowledge or experience to recommend alternate forms of government. But, I think it is possible for somebody else to work that out. What I was trying to say was that functional approach limits the understanding of one’s role. This may come in the way of effectiveness of doing performing one’s role, one’s perspective.

WJ: How would you put the present trend in policies and their impact on Indian Industries?

LRB: It is too soon to say anything. My own assessment is if the present policies continue, the Indian industry is in for a great deal of trouble. This may be contrary to what some of you may be thinking. It is for the good of the industry but not immediately. The trend seems to be for a much rougher competition for industry. Most of our industries are not equipped to cope with this kind of competition. But in the end whatever will be left will be efficient. It is like taking plants that have been growing in a hot house and putting them outside in the open.

WJ: How long will this period of transition be?

LRB: It will take about a decade, I think.

WJ: If we want to survive in the international market we have to tone ourselves up. Isn’t it better now than later? Now we are not at all that industrialised?

LRB: True. It’s got to be done. But some amount of selectivity may also be desired. To cope with the turbulence in the government may also be an issue. If the turbulence is too much, the government may not survive.

WJ: Would you recommend an open economy?

LRB: I wouldn’t.

WJ: What would you recommend for basic growth?

LRB: You would need several things. I am not competent to talk about all that.  About Industrial policy, I would recommend that we need clarity on what we ought to pursue in which we will excel and be internationally competitive (I), what we pursue in order to meet our own needs reasonably satisfactorily but not be internationally competitive (II), and what we need to pursue in what will make do (III). Ideally there should be nothing in that last category. We need a dynamic policy, which, over a period of time, redefines all these things. Hopefully, we would move more from III to II to I over a period of time. There is not a single area where we operate where the focus is in the international arena, where we are a force to be reckoned with. Where we should be a force to be reckoned with because of our large consumption and trade, we get the least from our share in value. For example, take the price of tea a consumer around the world pays and the kind of prices we realise for the tea we sell. We don’t realise even a fraction of the retail price. So where we have strengths, we have messed it up. We are trying to sell our engineering goods on a marginal basis. We are neither organised technology wise, manufacturing system wise or marketing wise, to be a force in any of these areas. We have to make up our mind. Our entire planning is domestic oriented, a closed world system. If we open up the whole system we will sink. So we have to do it selectively. We need clarity on this mix and a time horizon perspective. Take two wheelers for example. There is no earthly reason why India could not have made two wheelers. We have such a large domestic market that we could have used the opportunity to set up capacities, technologies which could supply the world’s need of two wheelers. We have always put on blinkers. Said that the country needs only this much. And then there is this brahmanical perception of all of us. So-called intellectuals who are in the decision making levels who decide India may need so much but we should have only this much. That some item is a luxury good and the country cannot afford business. We individually can afford and would like to have them, but the country cannot afford them. This makes it less and less affordable for the country. In anything we have done, we are pygmies.

WJ: Is the planned economy responsible for all these things?

LRB: It is not the planned economy but the concept or kind of planning. I think it is the value system of our economists. There is very little technical in these things. Everything has got preferences associated with it. The western educated, alienated Indian’s perception has crept into the bureaucrats, the economists, the professionals. All of us. We don’t think India as us. We think of India as millions of poor people living in thousands of villages and impose our values on what they should have should not have. What they can afford and cannot afford. A very schizophrenic approach and all these economists educated at Cambridge with their Fabian Socialism have reflected their split personalities. They have looked at India as an entity alien to themselves, looked at it as a poor third world country which has only to slowly make its way.

WJ: Is it because the politician has abrogated his right of decision making to the bureaucrat?

LRB: Partly, yes. We couldn’t say that for the first 15 to 20 years. Then even the politician thought like that. He was the very epitome of a schizophrenic, he felt for the country but he was not part of it. Look at the difference between India and China. Mao lived literally as a Chinese peasant. So his perceptions, his priorities were very different from that of Indian leaders. Pandit Nehru was a do-gooder white man. He was like a missionary. He didn’t belong here, but he had a tremendous zeal for uplifting the poor. But you cannot then cross the line and think and feel like what the majority of the people – their priorities, etc. We have not yet thrown up a leader like that, from that background and culture. That way the politicians are as much responsible.

WJ: Could you tell us something about your other interests in life? Reading, writings, etc.

LRB: My other interests are not very powerful and I have not been able to pursue them. My primary interest is centred on the management movement. In the earlier days I used to write something, a bit of poetry. I used to read literature – poetry mainly. I was also interested in the theatre – the stage. But living in Ahmedabad I have not been able to develop much interest in the Gujarat stage.

Travel is another hobby. Travel and tourism. I have travelled quite widely. Within India and outside. Experiencing people. Eating what they eat. I have travelled in Africa, Europe, North America and other Asian countries. The most important learning has been tolerance. Like I started eating non-vegetarian food. Earlier, I found it even difficult to smile at somebody who ate meat. I also take a great deal of interest in social and organisational systems wherever I go. It is very interesting to find out how others live.

1 comment:

  1. I had the good fortune of learning from LRB at IIMA 1984-86. Such was his popularity that students from second year MBA used to come and sit in first year class that LRB used to take. His method of teaching was so powerful and combination of humpr, sarcasm and incisiveness that even after 27 years of graduation I could vividly recall those lessons. I can safely say that he was the most popular and respected professor at IIMA during our time. If I remember correctly, Harsha Bhogle wrote a very humorous piece in the weekly rag magazine "Synchrony" about the "Godlike" position he enjoyed among students. There was also a case in PIPD inspired by his HLL experience and the provess of deciding on PhD (The curious case of Deepak Dey). I also remember fondly the Rosagullas he offered to the students who went to his house on Holi. Personally, I was lucky to have him as our Final year project guide and every meeting with him was a treat in itself. Contrary to the image of a stern and tough professor that our seniors had created, I found him extremely patient, caring and supportive during our interactions. I was in Japan in Oct 1988 when I heard of the tragic air crash in which we lost LRB. A part of me died that day as he was undoubtably the most loved prof. at IIMA and arguably the brightest. He lives in our memory forever


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