LEADING ORGANIZATIONAL TRANSFORMATION

 from 33rd World Conference of IFTDO

 

The 33rd World IFTDO Conference in New Delhi was attended by over 1200 delegates from 32 countries in 5 continents. There were 133 speakers. Summary of a few three talks by Rajeev B Bhatnagar.


[Credit for all inaccuracies and mis-interpretations is mine - Rajeev.]

 

CONTENTS

 

1. IFTDO

 

2. Leading Organizational Transformation  - by Dr. Chandan Mitra

 

3. Leading Organizational Transformation in Power Sector  - by R.V.Shahi

 

4. Organizational Transformation in UTI and IDBI – by Mr. M Damodaran

 

5. More on IFTDO

 

6. The Inaugural Speech : Creating A Brand Image for the Institution

 

 

1. IFTDO

 

IFTDO stands for International Federation of Training and Development Organization. One of the largest organizations in world in HR, it has more than 100 member organizations representing more than 1,00,000 training and HRD specialists.

 

33rd IFTDO World Conference was held in New Delhi from Nov. 22nd to 25th,  2004. It was organized by ISTD (Indian Society for Training and Development). Amongst Corporates, the main sponsor was ONGC (Oil and Natural Gas Commission). Mr.Subir Raha, CMD of ONGC, deserves a huge big thanks from all HR professionals for supporting the conference.

 

The world conference was attended by 1200 participants from 32 countries. There were 133 speakers of whom 30 from overseas.

 

I have summarized the session of “Leading Transformation in Organizations,” which was most enlightening to me.

 

Their website is at http://www.iftdo.org

 

 

 

2. Leading Organizational Transformation  - by Dr. Chandan Mitra

 

 

An Outstanding Professional

 

Dr. Chandan Mitra is Managing Director of The Pioneer Group. He is a journalist by profession and after holding senior editorial positions in leading newspapers, he became the editor of “The Pioneer,” a 140 year old newspaper in India.

 

The Pioneer was a sick organization on the verge of closure. Dr. Mitra purchased the newspaper with help of loans from well-wishers and transformed it into a profitable enterprise. He achieved this without any drastic measures on HR (like job cuts).

 

He has written many books including “Corrupt Society.” He was nominated as a Member of Rajya Sabha (Upper House of Legislature in India) in recognition of his services to media.

 

Session was chaired by Dr. Mitra.

 

General Comments

 

Dr. Mitra pointed out the difference between change and transformation.

 

·        Change happens continuously on it’s own. On the other hand, transformation is directed and deliberate in the sense.

·        Transformation requires leader or a core group of leaders to bring about transformation.

·        Change is value-neutral, in other words it can be either good or bad. Values are also involved in transformation.

 

There are many issues in transformation

 

 

Dr Mitra suggested that the session should well upon

 

·        What does take in a leader to bring about transformation?

·       What is the degree of commitment needed inside the leader to bring about the transformation?

·        And how does he motivate his people.

 

 

 

3. Leading Organizational Transformation in Power Sector  - by R.V.Shahi

 

 

An Outstanding Professional

 

Mr. RV Shahi is one of the most outstanding professionals of our times. He shared his personal experience based on two organizational transformations.

 

His career started with SAIL (Steel Authority of India Limited), the largest steel producer in India. Then he moved to NTPC (National Thermal Power Corporation), the largest public utility company in India & rose to become it’s Director (Operations). Then he joined BSES Limited and became it’s CMD.  Now he is the Secretary, Ministry of Power, Government of India, the highest position in power sector.

 

Mr. RV Shahi is a Mechanical Engineer. He has PG in Industrial Engineering as well as PG in Business Management. Also a Diploma in Advanced Industrial Management from Delft, Holland.

 

 

Transformation versus Change

                                             

Mr. Shahi pointed out that transformation is more than a change. It can be at a factory level or company level or economic level of a country or a national level. He shared his first hand experience about transforming two power plants which were taken over by NTPC.

 

Two Examples from Personal Experience

 

Badarpur Thermal Power Station

 

The first was Badarpur Thermal Power Station which was taken over by NTPC in 1978 from Government of India. The power station was supplying electricity to India’s capital (New Delhi) and was a loss making unit running inefficiently. This Power Station has since turned around and is amongst top 15 plants in India in efficiency. 

 

Mr. Shahi observed that main element in such a transformation is a top management team should be committed to the change and the rest follows.

 

Unchahar Power Station

 

This was another sick power plant taken over by NTPC, this time from the Government of UP, one of the states in India. At the time of handing over the plant, the Govt. of UP took a commitment from NTPC that no workers will lose jobs. NTPC agreed to the condition.

 

However, NTPC made it clear that they will change 40 to 50 top managers managing the plant viz. Chief Engineers, Superintending Engineers & Executive Engineers. In 100 days after take over by NTPC the plant was turned around and achieved 60% generation.

 

Mr. Shahi observed in such transformation, critical thing is that the Top team has to be with the Management. In other words, a critical number of Top managers can bring about a change.

 

 

Need for Training in Power Sector

 

One of the primary problems is that staff is not adequately trained in distribution sector of state electricity boards. There is a very urgent need to start training institutes in state electricity boards. Training and development, like in this case, can help in re-engineering the distribution process.

 

 

Components in Transformation

 

He said: I do not wish to make it appear that transformation is an easy process and that if you change top managers it will happen. Having a critical mass of top managers is a most important thing.

 

Other things are required like involving the people, brain-storming solutions, re-engineering processes and procedures, training and development which could help in re-engineering.

 

Massive transformation do not occur over-night but can take even up to 10 years. It is essential that we have a road map for transformation rather than get captured by our vision (& become disappointed in absence of over-night results).

 

 

Transformation of Power Sector

 

Many State Electricity Boards in India are making annual loss of the order of Rs.100 to 150 billion per year. For instance the power station in Muzafarpur (Bihar) is running at an utilization of 10 to 15%. It is possible by proper leadership to bring about a transformation in most of these state electricity boards and reduce the losses being incurred.

 

Transformation in power sector is very important in economic growth of India. In fact the latter (economic growth of India) depends on transformation in power sector. For transformation, we primarily need a critical mass of managers who are involved and committed to the change process.

 

 

Transforming the Indian Economy

 

Mr. Shahi said that in attempts to transform Indian economy, the objective set were excellent & powerful. But change has been slow because re-engineering of processes and procedures to support the new objectives did not happen.  In conclusion, he said, for achieving transformation, we should:

 

 

 

From Question – Answer Session

 

One of the participant asked, how do your change the mindset of state leaders who wants to give free power to people for getting votes. Mr. Shahi pointed out that Chief Ministers of 3 states have agreed to abolish the supply of free power in their states. Change process is very frustrating. At leadership levels, we cannot allow ourselves to be frustrated by impediments. The leader has to be ready for the long haul.

 

One participant asked what would be your strategy in bringing about transformation in Bihar – one of the most poor, law-less and disorganized states in India. 

 

Mr.Shahi replied that the strategy would be same as Unchahar or Talcher Power Plants - viz. change a critical mass of top management team and top management should involve their respective team in the change effort. This overall strategy, which would remain same, could be further customized to Bihar.

 

 

 

4. Organizational Transformation in UTI and IDBI – by Mr. M Damodaran

 

An Outstanding Professional

 

Presently Mr. Damodaran is Chairman, Industrial Development Bank of India, the apex bank in India for industrial finance.

 

He has substantial experience in managing large financial institutions facing crisis. A serving bureaucrat in Govt. of India, he moved to Reserve Bank of India, where his brief was to supervise the turnaround attempts of three large banks which were “weak.” Two of the three, UCO Bank and United Bank of India, have recently posted profits.

 

In 2001, he became Chairman of UTI (Unit Trust of India), India largest mutual fund, which was passing thru it’s worst crisis. Then UTI was managing assets exceeding US $ 16 billion (INR Rs. 750 billion) and around this time, the previous chairman of UTI was put in jail in connection with alleged misappropriation of public funds.

 

In 2003, after dealing with the UTI crisis, he became the CMD of IDBI, which is his current role.

 

About Transformation

 

Mr. Damodaran’s talk was also based on his personal experience of transforming large organization like Unit Trust of India.

• He also said that change and transformation are not same. Change can be incremental whereas transformation is all encompassing.

• General impression is that only the sick or weak organizations need transformation. Truth is that even healthy & strong organizations need transformation otherwise they tend to fall into difficult & bad times.

• Unfortunately transformation in organizations takes place only when its existence if threatened and challenged ( rarely happens proactively).

He said he had seen such transformation in last 10 years.

 

 

Overall Guidelines for Implementing Transformation

 

All organizations have products, processes and people. For transformation we

• have to focus on people, people and people.

• clearly need to bring a new leadership. You cannot have leaders who have been part of the problem.

Mr. Damodaran said leaders have some common attributes, which are same irrespective of time and countries. They also have some specific attributes, which are specific to the organization which they are leading. Then he went to describe the general attributes.

 

 

Attitudes & Characteristics that Help Transformation

 

The new leader who comes to transform an organization should have certain attitudes and characteristics which Mr. Damodaran described as under:

 

1. New Leader should have an open mind. He cannot be carrying ideological baggage or informational baggage or past learning baggage. If people perceive him having fixed solution they may not respond to his call of transformation.

 

2. When the new leader enters to transform an organization, he faces a several pitfalls. First set of people to reach you are those who have been part of the problem. The second set of people reach you are those who tell that whatever your predecessor did till yesterday was wrong. Neither of them are correct and you must give a clear message that they should give an authentic information.

 

3. Don’t deal with papers, deal with people. Identify the change agents, empower them, incentivize them and hold them responsible.

 

4. Get constructive devils advocate of organization to work under you. Since you are new, you do not know the nature and culture of the organization – perhaps not even the industry.

 

5. Mr.Damodaran has pointed out that many years back he dramatically saw two leadership styles. He saw a British Army contingent where the leader walks 20 steps ahead of the boys. The other was in the Australian Army contingent where the leader was one amongst the boys. He said, in today’s world one has to be one amongst the boys to bring about transformation.

 

6. You have to get some quick wins by taking some decision and getting them implemented. You have to make clear & emphasize that you are the boss.

 

7. After a dispassionate analysis of the situation, you have to move to passionate implement of the solution.

 

8. Do not bring any outside consultants immediately. This sends a message that no one within the organization can solve the problems. It also gives the impression that you do not really have the solution. Every organization has enough wisdom within it to find what is needed and you have to find them. At some later times, outside consultant can be involved.

 

9. Mr. Damodaran said that one big point he has kept for mentioning in the last. We have to have continuous communication with external as well as internal stakeholders. The attitude that I will talk to stake holders after I have fixed things is not workable. Stakeholders do not wait.

 

10. Do not fix the people. Focus on fixing the problems. Do not do postmortem. In postmortem you are dealing with the dead, in transformation you are dealing with the live people.

 

11. Finally pray that you succeed in transforming the organization because even if you have done everything outlined above, there are no guarantees.

 

 

Guaranteed Success

 

Mr. Damodaran gave an example of a man who went to doctor and asked: “I want to live long. What should I do?”

 

Doctor said do not smoke, do not drink, do not eat sweets and fried things. Exercise daily. Do not stress yourself.

 

The person asked “Will I live long?”

 

Doctor replied, “No, at least it will seem very long.”

 

Mr. Damodaran emphasized that just like that long life cannot be guaranteed by following all the right rules, so also success in transformation.

 

 

5. More on IFTDO

 

IFTDO was established in 1972 in Switzerland and is registered in UK as a non-profit body. It is an organization of organizations. It is a global federation of organization with members from HR. It receives membership from professional training and HRD National bodies, Universities, Colleges, Governments, Commercial Institutions, Consultancy practices and MNCs. 

 

Since 1972 IFTDO organizes annual World Conference and with every passing years this grown in stature and recognition bringing together the experience and knowledge of professionals from the four corners of the Globe.

 

ISTD was established in 1969. It is a national level non-profit society and has a huge membership. It has 39 chapters in India and about 4100 members.

 

 

6. The Inaugural Speech : Creating A Brand Image for the Institution

 

The Conference was inaugurated by Honorable Dr. APJ Abdul Kalam, President of India.

 

Dr Kalam spoke about "Creating A Brand Image for the Institution." The President of India said that for achieving success in any field – be it Education, Technology, Agriculture or Industry – the organization has to create a brand image. For building the right brand image, there are 5 areas to focus on.

 

"Promoting excellence in organizations leading to the creation of brand institutions depends on five important components. They are:


Design capability,
Competitiveness,
Organisational transformation,
success/failure management and
establishment of Institutional ethical standards.

We have a few brand institutions in the country and many are aspiring to become. Let us discuss. ..............................."

 

Those of you interested in the subject can read the full speech at the following link 

 

http://presidentofindia.nic.in/scripts/sllatest1.jsp?id=429  

 

If you also have a problem with the link, please search the above site for President's speech on 22nd Nov 2004.