A study by four professors at Penn looks at the abilities of Indian managers to handle crises
As the economic slowdown takes root across the world, business leaders everywhere are grappling with varying degrees of its intensity and depth.
While some countries are struggling with heavily contracting economies, others, like India, are seen as being in a more favorable position, having got away with merely trimmed-down growth. The global sentiment is highly favorable towards India right now.
Indian companies, for instance - until a decade or so ago relatively unknown outside the country - have come into focus over the last few years for their international competitiveness. The question therefore begs to be asked: Are Indian CEOs somehow better equipped than their Western counterparts to deal with crises? Are there unique characteristics in their style of management that offer them competitive advantage and are there lessons to be learned for the American CEOs?
A new study, titled "The DNA of Indian Leadership: The Governance, Management and Leadership of Leading Indian Firms" and conducted by four University of Pennsylvania management professors - Peter Cappelli, Harbir Singh, Jitendra Singh and Michael Useem - attempts to answer those questions.
At the recently concluded Times Ascent "HR Forum," Professor Harbir Singh summarized the findings of this paper. After all, who better than Singh, described as "the perfect knowledge bridge between the U.S. and India" by ICICI's Chief Human Resources Officer K Ramkumar, to draw these contrasts? Armed with degrees from IIT Delhi and IIM-A and short tenures in Philips India and Madura Coats, Singh set off for the U.S. and joined the Wharton School faculty in 1984 where he is currently vice-dean of its global initiatives and chair of the Management Department.
Singh is a sought-after authority on innovation and undoubtedly his reputation in India Inc's most powerful corridors allowed him access to some of India's busiest CEOs, from Mukesh Ambani to NR Narayana Murthy. What emerged from those discussions, he said, is that the Indian management style is highly distinctive.
Each CEO in the study was asked a set of questions about leadership competencies, competitive advantage and corporate governance. "One very unique difference," said Singh, "is that Indian leaders think in English, thanks to their Western educations, but act in an Indian context. They internalize Western best practises but adapt them to India."
Tata Sons executive director R Gopalakrishnan, for instance, said that Indian leaders rely far more on intuition than their Western counterparts. When asked what they thought were the competencies most important to their recent successes, the Indian executives felt that strategic thinking, risk taking abilities, resilience as well as setting the shared architecture of the firm were some of the most important leadership capacities.
The other clear differentiator that has emerged is the way Indian leaders perceive the role of their firms in society. Firms, they believe, must have a larger role beyond the narrow interests of their shareholders to actually be seen as bringing positive transformation to society. Speaking of shareholders, in sharp contrast with Western CEOs whose No. 1 management priority is the investor, for Indian CEOs it actually emerged at the bottom of the priority list; instead they are far more preoccupied with long-term strategic vision, talent nurturing and being the keepers of organizational culture.
Not all the differences between Indian and U.S. CEOs that emerged in the study paint the Indians in a positive light. According to the report, some of the Indian CEOs pointed out that they tended to be hierarchical, which they viewed as a negative trait. Singh drew some laughs when he pointed out to the most unique quality of the Indian management style — the "jugaad" factor, which is the tendency to resort to an improvised quick fix or make-do. "While this can be perceived negatively, it can also be a positive trait because of its inherent inventiveness and survival instinct," concluded Singh.