Values – the real ‘Soul’ of organizations

Vision and Mission Statements of corporates adorn their walls and can be readily copied. However, the value system of an organization is not something which can be copied very easily. It permeates the entire organization – its hierarchy, its various divisions or departments. It rubs off on most of its employees. Even service providers and supporting manufacturers get tuned to the same frequency. It would perhaps not be wrong to surmise that values are to an organization what the soul is to a physical body. Organizations which thrive over a long period of time and achieve sustainable commercial success would invariably be found to have sound values at the core of their operations.

Manifestation of values

Small things reflect the values being followed – whether nephews and nieces of the top person are getting freely hired to do jobs they are not competent at, whether spaces in the car parking lot are allotted hierarchy wise or are based on a first-come-first-served basis, whether the corner office has high sound-proof walls all around or is open to all to signify transparency, whether the boss is entitled to charge the company for her spouse accompanying her on a business trip, whether office stationery items get whisked off to executives’ households for use by their kids, or whether use of cell phones or social media platforms is viewed with a sense of benign resignation by a hapless human resources honcho.

One striking feature of values is that even if these remain spoken of in hushed tones and get communicated more effectively through grapevines which are embedded deep in any organization, it is leadership which sets the tone. Those down the ladder fall in line. Those who shape up, and have a reasonably good performance on the job, survive and do well. Those who do not, get eventually shipped out. The latter then try to look for other organizations where the values – theirs and those of the organization – happen to be in harmony.

When head-hunting for a CFO, Human Resources honchos know pretty well that even though the final three short-listed aspirants happen to have near-identical qualifications and experience, their personal value systems would set them apart. One would not mind being used to extensive window dressing to please diverse stakeholders, thereby raising the concern for a disaster lurking round the corner in not so distant a future. Another might admit to being open to transactions in hard cash, thereby consolidating his own power and pelf in the company, if appointed. Yet another one might take a dim view of any underhand dealings and project the image of someone who believes in transparency with the internal as well as the statutory auditors, thereby leaving the CEO and the board of directors breathing easier. If the management cares about maintaining high standards of corporate governance, the last one would land the assignment.

At the macro level, values of an organization manifest in the wisdom which underlies its actions. When it comes to achieving the heights of corporate excellence, organizations which have sound long-term values are invariably found to enjoy strong brand equity. Scratch beneath the surface and one is apt to discover the wiser ways in which it conducts its operations. Its initiatives lead to a sustainable growth of the business, giving back to society in ways which are imaginative as well as pragmatic.

Take the case of Tatas, a salt-to-software business conglomerate which has more than one hundred companies in its fold, spread over more than one hundred countries. Their businesses might be as diverse as chalk and cheese but much like beads strung together by a string, what holds all these outfits together is a common set of values which the group stands for. The name stands for dependability and better value for money. Around two-thirds of the profits of the group flow into Tata trusts which channelize these back to the society in myriad ways.

Speaking to the conglomerate’s leadership recently, Ratan Tata, Chairman Emeritus, said that the group has been under “fire” for the past few months due to allegations of mismanagement and “being in business for reasons other than good corporate governance”. “The spirit that we had that made us grow to $100-billion revenues has not been through mismanagement and unethical procedures,” he said, adding that it has grown by being a visionary, having a spirit of integrity, unity and doing philanthropy.

Products and organizations have life cycles of their own. Just like the human body is prone to many changes – birth, existence, growth, decay, disease and death. But values outlive these perils of life; somewhat akin to the Self which Gita holds to be eternal and deathless. Values pervade all arms of any organization.

अविनाशि तु तद्विद्धि येन सर्वमिदं ततम् |
विनाशमव्ययस्यास्य न कश्चित्कर्तुमर्हति || 2.17 ||

avināśhi tu tadviddhi yena sarvam idaṁ tatam
vināśham avyayasyāsya na kaśhchit kartum arhati

That which pervades the entire body, know it to be indestructible. No one can cause the destruction of the imperishable soul.

The Purpose of an organization

Why does an organization exist? What is its purpose? Can an organization be run in such a manner as to be long-lived? Can an organization strike a judicial balance between owner enrichment and societal good?

Nikos Mourkiaginnis, in his famous book ‘Purpose – the Starting Point of Great Companies’, demonstrates that the choice between values and success is no choice at all. He argues that companies must satisfy the need for purpose – a set of values that defines an organization and inspires and motivates its employees. Rather than organization and structure, ideas are what cause companies to go from good to great. Drawing on examples from across multiple industries, Mourkogiannis demonstrates how a strong purpose is the essential first step toward lasting success.

This is a great insight. An organization’s purpose is merely not to deliver goods and services to its customers. What really matter are the values which determine the choice of these products and services. Looked at from this perspective, one would not be wrong in concluding that values, which determine the purpose of an organization, indeed constitute its soul.

An inner connection to handle myriad challenges with aplomb

Hapless CEOs face myriad challenges. There are pinpricks from customers, employees, suppliers and many other stakeholders. The directors and the shareholders have to be kept in a positive frame of mind. Regulatory agencies and government departments have to be kept in good humour. Concerns for upholding norms of corporate governance keep snapping at their heels. Only nerves of chilled steel and deep reserves of inner resilience can help them to keep performing on all the twelve cylinders. An inner connection surely helps.

In an indirect manner, Gita touches upon the importance of an inner connection for business leaders. It holds that wise are those who enjoy a tranquility and calmness within themselves. Their inner being is in harmony with their outer being. Their decision-making is based on balanced, well-considered and a holistic view of the facts of the case. They do not manage crises in business with knee-jerk reactions. They deal with people according to their nature and with occurrences in the business environment according to their force and the truth or hard reality they represent. Impartial they are. Detached they are. Compassionate they happen to be, but never at the cost of their innate wisdom and truth. And never do they compromise on their core values.

(A version of this post would appear in a yet-to-be released book authored by yours truly which connects Bhagavad Gita to Management)

 

 

 

 

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Of Homo Organizationum and Consciousness

Successful organizations which boast of high brand equity follow several sustainable practices. One of these is the practice of treating their human assets with the respect and dignity they deserve. While compassion and empathy govern their HR practices, it would be wrong to surmise that they do so by compromising on their business goals.

This unique species of organizations, referred to here as Homo Organizationum, is envisaged as the one comprising Functionally Humane Organizations, where an optimal balance is  maintained between business results and human relations.

Let me share one such instance from my own career.

High performance vs domestic bliss

A star performer in an IT manufacturing set up had to strike a fine balance between her role as a crucial final quality controller and that of being a home maker. In her absence, high priority shipments could get delayed. At home, she had to take care of an ailing mother-in-law and a kid. Her husband used to work in another set up around 900 kms away and would come visiting once every two months.

On a specific weekend, when an important shipment was to leave the factory late at night, message came that her husband was on his way home. Much to her dismay, a permission to leave the factory at the normal closing time was promptly turned down by her immediate superior.

The grapevine ensured that the incident of refusal of permission percolated upwards to the manufacturing head. The superior was called in without delay and given a dressing down. He, and the head of Quality Assurance, were guided on making alternative arrangements.

Eventually, the woman was delighted to receive a permission to leave the place of work by lunch time itself, adding a few precious hours to her domestic bliss. The shipment also got despatched without any compromise on the immediate business goal.

Several such examples abound. Regrettably, however, these are outnumbered by the kind of instances which involved blatant exploitation of employees. Across organizations, this manifests in so many ways. Inhuman treatment while pursuing an immediate business goal. Depriving the employees their rightful dues. Lower salaries, accompanied by liberal grant of personal loans and advances, thereby keeping the employees perennially indebted to the employer, and the like.

The leaner Davids and the flabbier Goliaths

When I look back at my 35-year exposure to the private sector, one thing stands out. The positive examples were mostly from the larger companies in the organized sector. The negative examples were invariably from the small-scale sector.

Large companies have a better organized way of working. They often carry some flab. Systems take precedence over individuals. On the contrary, the smaller ones tend to be much leaner – though decidedly not fitter – simply because one person gets hired only when three are required!

The Consciousness of Organizations

Members of the species of entities known as Homo Organizationum thrive only when they can add value to their diverse stakeholders. However, to create a brand which is respected by their customers as well as their employees, as also to add value on a sustainable basis, they need to have a working culture which places a higher premium on such values as empathy, compassion, dignity, respect, justice, honesty, openness, transparency and equality.

Their employees then become their brand ambassadors, making it easier for them to attract better talent. This, in turn, makes them more efficient and effective.

All organizations have a consciousness which seeps through all its organs. It manifests itself in myriad ways; specifically, through its culture. It is reflected in the manner in which the seniors conduct themselves. It shows up in the way decisions get taken. Unlike grandiose Vision and Mission statements which adorn their physical walls, it is not easy to articulate culture in words. Nor can it be readily replicated.

Just like a tiger is known by its stripes, an organization is known by the kind of consciousness it lives and operates by. The more humane the same, the higher the probability of sustainable success.

Some crystal gazing

Advances in technology are already re-shaping our organizations. Gone are the control-and-command structures. Hierarchies are getting flatter. Mundane tasks are being taken over by Artificial Intelligence and Robotics. Geeks are twiddling their thumbs, trying to cope up with Machine Learning, Augmented Reality, Virtual Reality, Internet of Things, et al.

Besides technology, buyer behaviour is changing. Geopolitics is changing. Workforce attitudes are changing.

But Homo Organizationum face little risk of becoming extinct. On the contrary, it is quite likely that with the kind of changes in the offing, the need for organizations to be humane would only go up in the future.

Time for HR honchos to re-skill themselves.

(A version of this article was published in the IBA Journal, volume 9, issue 2)

 

 

 

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