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BRIDGING THE GAP BETWEEN POTENTIAL AND PERFORMANCE: THE CHALLENGESS OF INDIAN MANAGEMENT

BRIDGING THE GAP BETWEEN POTENTIAL AND PERFORMANCE: THE CHALLENGESS OF INDIAN MANAGEMENT. FRANCIS PIRON, Ph.D., 2013. A COUNTRY OF CONSIDERABLE CONTRADICTIONS. Willing & able to play a leading role in the global economy but with a closed economy in terms of labor, capital and knowledge

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BRIDGING THE GAP BETWEEN POTENTIAL AND PERFORMANCE: THE CHALLENGESS OF INDIAN MANAGEMENT

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  1. BRIDGING THE GAP BETWEEN POTENTIAL AND PERFORMANCE: THE CHALLENGESS OF INDIAN MANAGEMENT FRANCIS PIRON, Ph.D., 2013

  2. A COUNTRY OF CONSIDERABLE CONTRADICTIONS • Willing & able to play a leading role in the global economy but with a closed economy in terms of labor, capital and knowledge • Highly confident national mindset but small number of confident entrepreneurs • GAP BETWEEN INDIA’S POTENTIAL & PERFORMANCE

  3. A COUNTRY OF CONSIDERABLE CONTRADICTIONS • Laden in traditions: • Domination of families • Highly bureaucratic government systems • Lack of management know-how & professionalism, & ethics • Low quality • Protectionist Culture =>Inefficiencies, Corruption • Significant Global Leadership in Software, Automobiles, Bio-technologies, Pharmaceuticals

  4. LOCAL ISSUES & FORCES OF TRADITION INFLUENCING THE MGMT HERITAGE OF INDIA • Key Traditional Socio-Cultural Influences on the Indian Mindset: • Strong residual influences of cultural & spiritual forces • Existence of “ Split Personality” • One type of behavior in the organizational context (collectivist), • Another type at the very personal level (individualist). • This duality is guided by: • Desh: Site or location, • Kaal: timing, • Patra: Specificities of the context

  5. LOCAL ISSUES & FORCES OF TRADITION INFLUENCING THE MGMT HERITAGE OF INDIA • Key Traditional Socio-Cultural Influences on the Indian Mindset: • Dissonance between democracy & caste system • Concept of “Guna,” a personality attribute guiding behavior • Sattawa Guna, virtue orientation, refers to higher values, • Tamasik Guna, negative value orientation, as with ignorance, corruption, • Rajas, action orientation, strong purpose/focus • Western mgmt values are tempered with Indian values, and patriotism & religious values shape organizations, businesses, companies, etc.

  6. LOCAL ISSUES & FORCES OF TRADITION INFLUENCING THE MGMT HERITAGE OF INDIA • Key Traditional Socio-Cultural Influences on the Indian Mindset: • Contemporary managerial worldviews derived from deep spiritual Indian values, such as Nishkama Karma, the central concept of the Hindu source of human endeavor • These deep values are rooted in Vedantic philosophy • Emphasis on Dharma, the principled, ethical core, • On Artha, the practical challenges, • Kama, the worldly motivation, • Moksha, the self-actualization. • Such values are dominant in managerial leadership, organizational cultures, strategic formulation • Tata uses Dharma as the primary base for appraising managerial performance

  7. LOCAL ISSUES & FORCES OF TRADITION INFLUENCING THE MGMT HERITAGE OF INDIA • Key Traditional Socio-Cultural Influences on the Indian Mindset: • Education based on rote memorization (as in China), but with strong ability for abstract thoughts (different from China), intuition and logic (argumentative vs. discipline & obedience for Chinese) • Cultural bonding involves • Sradha, the upward loyalty to someone senior, and • Sneha, affection for and mentoring of someone junior, • Similar to Confucianist values parent-child, older-younger siblings • Family bonding and social links at the workplace are one of the most positive cultural practices that sustain Indian organization (loyalty, hierarchy, reciprocity, etc).

  8. LOCAL ISSUES & FORCES OF TRADITION INFLUENCING THE MGMT HERITAGE OF INDIA • Key Traditional Socio-Cultural Influences on the Indian Mindset: • Key Traditional Socio-Cultural Influences on the Indian Mindset: • While collectivistic in non-work contexts, Indians are individualistic at work … “Split Personality.”

  9. LOCAL ISSUES & FORCES OF TRADITION INFLUENCING THE MGMT HERITAGE OF INDIA • Managerial Context & Global Competitiveness: • Stable institutions • Slow and rigid bureaucracy but abide by the “rule of law” and independence of the judiciary • “License Raj” 5 decades of “mixed,” socialist-patterned economy • Moved from an economy of chronic food shortages to a service-oriented economy, becoming a global provider of IT solutions • Significant improvement in the quality of “Made in India” products • Massive growth of management schools and knowledge-based industries

  10. LOCAL ISSUES & FORCES OF TRADITION INFLUENCING THE MGMT HERITAGE OF INDIA • Indian Competitive Advantages & Constraints: • Large pool of English speakers • Knowledge-intensive human resources • Young population (compare to “Reserve Army of Underemployed” • Linkage to Indian diaspora • 38% of MDs in the USA are Indians • 2% of Scientists in the USA are Indians • 36% of NASA employees are Indians • 34% of Microsoft employees are Indians • 28% of IBM employees are Indians • 17% of Intel employees are Indians • 13% of Xerox employees are Indians • Indian Competitive Advantages & Constraints: • Large pool of English speakers • Knowledge-intensive human resources • Young population (compare to “Reserve Army of Underemployed” • Linkage to Indian diaspora • Regional diversity: • Inconsistencies in economic ideologies • Bharatiya Janita Party (strongly Hindu, heads govt. coalition) • Indian National Congress (main opposition) • Communist Party of India (Marxist) (W/ Bengal & Kerala states) • Samajwadi Party • Shiv Sena (MAharashtra state & Delhi) • All-India Anna DMK (Tamil Nadu state) • Akali Dal (Punjab state) • Indian Competitive Advantages & Constraints: • Large pool of English speakers • Knowledge-intensive human resources • Young population (compare to “Reserve Army of Underemployed” • Linkage to Indian diaspora • Regional diversity: • Inconsistencies in economic ideologies, • Inconsistencies in managerial mindsets, • Inconsistencies in governance • Ideology of nationalizations, regulatory controls, bureaucratic hurdles • Mindless bureaucracy lacking in innovative spirit

  11. THE MGMT OF INDIAN INSTITUTIONAL INFRASTRUCTURE • The Corporate Context: • Family Conglomerates: • The Corporate Context: • Family Conglomerates: • Global aspirations • Hybrid mixture of indigenous & sophisticated global managerial culture • Backbone of Indian economic & managerial life • Tata Empire = Indian business culture • Born Global: • Within the knowledge industry economy • Enshrine world-class quality, flat & empowered work teams • Multinational Firms employ the best of global mgmt practices • Govt-Owned & Controlled Entities lack performance and skills • SMEs – Trading mind set, unable to use scale economies

  12. A protest in front of the unfinished Tata Nano plant in Singur last week. (Prashanth Vishwanathan/Bloomberg News) West Bengal protests lead Tata to halt all work on Nano car factory

  13. THE MGMT OF INDIAN INSTITUTIONAL INFRASTRUCTURE • Towards an Indian Managerial Model: • Strong Nationalistic Pride: Mother India • Traditional cultural forces originating from the desire of achieving a robust global identity • Unavoidable prevalence of the bureaucratic institutional structure • New local confidence in innovation, enterprise & global reach

  14. THE MGMT OF INDIAN INSTITUTIONAL INFRASTRUCTURE • Managerial Emphasis at the Micro Level: • Motivational dynamics: • Different motivational patterns at various levels & industries • Emphasis on Dharma, the principled, ethical core, • On Artha, the practical challenges, • Kama, the worldly motivation, • Moksha, the self-actualization. • Different motivational patterns in private & public sectors • Priority of learning replaces economic & security motives • Managerial Emphasis at the Micro Level: • Motivational dynamics: • Different motivational patterns at various levels & industries • Different motivational patterns in private & public sectors • Priority of learning replaces economic & security motives • Decision-Making Patterns: • Top-Down Approach: • Professional & expert advice may be obtained • No or low request for participatory energy from staff • Bureaucratic rules dominate

  15. THE MGMT OF INDIAN INSTITUTIONAL INFRASTRUCTURE • Communication Process: • Reflect the country’s natural context: • “Shared Meaning” may not be consistent • Expectations of “time” are not shared between industries (i.e., future vs. now) • Excellence in English • Reliance on “task & role” orientated communication • Need improvement in cross-cultural communications & negotiations • Sensitivity to political, religious & social issues • Decision-Making Patterns: • Top-Down Approach: • Professional & expert advice may be obtained • No or low request for participatory energy from staff • Bureaucratic rules dominate

  16. THE MGMT OF INDIAN INSTITUTIONAL INFRASTRUCTURE • Management of Change Innovation: • Wider acceptance of shortcomings: • Lack of competition – protectionism, socialist orientation • Lack of professionalization • McDonald’s • Managerial & Leadership Culture: • Patriarchal leadership culture dominates • Acceptance of “satisfactory under performance” • Strong organizational discouragement of critical feedback

  17. REFLECTIVE ESSAY • WHAT HAVE YOU LEARNED ABOUT INDIAN MANAGEMENT? • HOW DOES IT COMPARE TO YOUR NATIONAL MANAGERIAL STYLE?

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