Sunday, June 17, 2007

Casa Bianca and Management professionals in the public sector.....

Talk about signature Italian restaurants run by true-to-the-name phoren owner, and one would start looking up the culinary guides of the metros. But there is an honest-to-goodness restaurant and pizzeria in town, and I love it. Surprised?! Casa Bianca is located on M.P. Appan Road at Vazhuthacaud and is the best place to head for if you like authentic Italian cuisine and pizzas. Lol, and the real deal in pizzas, not the americanized version doled out by the pizza chains. Last time I had grub like this was at the iconic "Bella Ciao" restaurant in Chennai and I don't think it was quite as good. And no, this is not an ad, just a useful tip! There, my good deed for the day is done!

And now on to the conversation around the dinner table. Around the table were yours truely and three of my friends. All Yem-Bee-Yeas and all from creme-de-la-creme B-schools, as a former boss of mine loved to say. Of course, there is a minor difference within the group. One of us was an aspirational leftist, unashamedly capitalist and yet nurturing a developmental aim in life. The others were all people who had chosen to put their management degrees to good use in the social sectors. Graduates of top rural management programmes, they are working with worthy causes, with a great perspective on how the vast majority of India works, away from cozy corporate boardrooms and snazzy IT campuses. So the conversation turned to how social sector programmes are being run, how professional managers can help out and how, unfortunately, the babus and netas try to undo things.

Imagine a project with a budget of dozens of crores, if not hundreds, thousands of workers, dozens of products and multiple locations. Sounds like something which needs a fair bit of management talent, right? Well, if the project we talk of us is Kudumbasree or Mathsyafed, does that need diminish? So, why then are there not many managers around, like my buddies?

The easy answer is that the money ain't good enough. After all, with investment banks and consulting firms paying so much money that people need to literally cart it away, the creme-de-la-creme would much rather be elsewhere than social sector projects which can't afford to pay as much in a year as they would make in a month or even a week at the common or garden variety investment banking job.

The truth is more complex. There are many who would want to work for such projects for no-frill packages because they want to see their skills put to good effect, where they can directly benefit society. And society, does not mean the shoppers at the neighbourhood mall or the customers of the neighbourhood Mercedes dealership. It also includes the majority of Indians, who don't figure in the target segments of a lot of professional managers. So why then don't we see more IIM-grads or such-like in the public sector?

Like I said, the answer is complex. And I am not trying to make excuses here. A lot of this is based on feedback from my friends as well as my own experience trying to promote developmental projects here.

Firstly, the idea of engaging professional managers is alien to a lot of government supported establishments. A hundred years of babu culture refuses to admit that seniority is not the only criteria for listening to someone and accepting their ideas. The latter is something that B-schoolers are taught to do. It is also often difficult to comprehend concepts like operational efficiency, customer centricity and other essential ideas of today's competitive business world.
In a very transactional world, grasping such concepts or deciphering such "high-tech" devices as power point presentations or cost-benefit analyses or charts is a non-starter. There is often a perceived threat to the As-Is way of doing things. Perhaps, this does not always grease palms, but it is a comfortable way of doing things. So, the new-fangled ideas of young managers are seen as disruptors.

For example, any manager would perform atleast an elementary cost-benefit or viability analysis on any project of significance. Whereas, we often projects or products take off without much of due diligence. The result is very often failed schemes or crashed products, further bleeding an already chronically anemic treasury. It isn't rocket-science but in an institution like a government where decisions are often taken bit-by-bit by a scattered chain of individuals, each with his or her own motivations or axe to grind, the use of decision support tools would seem new-fangled or even a threat to sundry fiefdoms.

That brings us to the second reason why the public or cooperative sector is not crawling with professional managers. The powers-that-be, top bureaucrats or elected representatives, often feel threatened by managers who infringe upon their domains, knowingly or unknowingly. Management techniques often call for numerical and factual analysis and decision making. And quite often, the facts don't stack up conveniently for the man or woman at the top. For example, the current Government has come out with the idea of IT parks in all districts. Very equitable and proletarian, but a quick feasibility study may prove that the idea stands on shaky ground, as IT/ITES typically needs factors like urban infrastructure, connectivity, human resources and R&D support which cannot be made to spring up overnight. In a state like Kerala, where the IT industry is still comparatively nascent, the time may yet not be nigh to be so ambitious. And that's what a manager, with his or her "sanity check-first" mentality may say. The correct opinion but not one to garner a few extra votes at the next installment of the election circus. Consequently, most organisations in the public sector and the cooperative sector have their governing bodies filled up with yes-men and political cronies. And these sets of staunch supporters are replaced each time a new ruling front comes to power. Whereas the LDF prefers members of the KSSP and the like during their tenure, the UDF sees it as a perk for the up-and-coming leaders, or for the older ones put out to pasture. While such arrangements are efficient in ensuring that politically astute line is toed, it often breeds inefficiency, sometimes bordering on chaos, and is extremely frustrating to any management professional, who is usually left chaffing at the bit.

So, if we empower the managers, will we see an influx of talent? Not so fast! The compensation needs to be addressed as well. Lol, after all, not everyone will work for free or close to it. The issue of higher pay is often one of ego as well. I was once told that one of the reasons for the CEO post of a very prominent GoK organisation lying vacant for a long time was that the Secretary of the concerned department didn't like a "non-IAS" manager" getting a package well in excess of his or hers. Lol, not surprising. So, the money does need to be improved. One can't hope to match the top private employers but needs to make sure the gap is not ridiculous.

All this brings us to why we need managers? Lol, in typical management ishtyle, there are a hundred different reasons - all in neat bulleted formats and with the respective annexures! After all that is why,hundreds of thousands of young men and women, yours truely having been one of them a long while ago, do battle with that awesome feline fiend - CAT, the Common Admission Test - each year. Frankly, after two years in B-school and another two in management consulting, I still think there is nothing amazing that managers bring to the table. Yes, the business models are savvy and the jargon used deliberately complex, but most of the stuff is pure common sense, dressed up expensively of course. However, there are sound analytical techniques being used and the management professional also has the ability to think across disciplines. Throw in a structured way of thinking, the ability to manage uncertainty and, more importantly, to manager diverse sets of people, and you get an idea why managers can be useful in the public sector. Many of the organisations in this sector are either underdogs or are facing stiff competition or great uncertainty. There is always the "but Bill Gates was not an MBA" argument, but the fact is, organisations with more skilled and trained people usually perform better, especially when operating in new and dynamic environments, and where systems are not yet in place. This could be a reason why global NGOs are trying to attract the best management talent these days, and paying top dollar for it.

So, having better management on board can help many organisations improve their performance. This means more benefit to the end beneficiary, the common man, and more bang for the tax payer's rupee. When the prevalent view is that only a small portion of public expenditure trickles down to the intended beneficiaries, any move to cut out the flab is welcome. Professional management techniques help to make organisations more efficient. Such techniques have been honed in environments where every paisa counts and efficiency is critical to the survival of the business. They may appear harsh, but there is absolutely no justification for the government/cooperative sector being any less efficient than their private counterparts. In fact, when the money being spent comes from the pocket of the common man rather than from the coffers of some affluent promoter, the need for efficiency is infinitely stronger! The easiest way that one can see professional management reduce public expenditure is by reducing consulting expenses. Crores of rupees are spent on consultants in Kerala alone. The Governmental sector is one of the biggest business for the Indian arm of a leading global consulting firm and sustains whole practices of other firms. What do they do, other than put a professional spin on insights and data that already exists? But in a world where many stakeholders like global financial institutions (the IMF, JBIC, ADB et al) or other investors are professional organisations, such services are required. For example, the Trivandrum Corporation tried to submit its JNURM proposals without using a consultant (We don't need them, they said) and were rewarded with having most of the projects sent back for "review" (Clean up the mess!, they said). Perhaps, as a management consultant, I shouldn't be saying this, but our ilk are as good or as bad as any other bunch of competent managers, and thus in-house management talent can obviate the need for external consultants to a great extent, and hence save a lot of desperately needed cash.

So, management professionals can help make things efficient, more effective and boot out the odd Con-sultant in the bargain. Is anyone listening? Apparently, someone is. GoK has announced its intentions to get professional managers to head up many of its units. A system to identify and induct talent has been mooted as well. I sincerely hope that it does not conveniently get buried under some file stack! What sick PSUs and distressed cooperatives need is not just an endless inflow of borrowed money and heavy rhetoric from the mantrijis, but professional management to get them out of trouble and into the black again. Otherwise it will be the same old story all over again. Good managers will cost much less than sinking money into black holes run by inept political appointees. GoK can even look at sending the best existing personnel to Management Development Programmes or Executive MBAs to hone their skills and develop new ones.

Be it new MBAs or born-again ones, ensuring that proper compensation - perhaps performance based - is in place and sorting out the operational independence issues, will ensure that there is a proper flow of talent, yours truely included, into the public and social sector. At a time when there is a mad scramble among States to corner as much investment as possible, presenting Kerala with an opportunity for development, unseen in the past, such an influx of talent is what the State, its institutions and its people sorely need.

No comments:

Post a Comment
