Monday, February 24, 2014

Suicidal Corporate Drivers Who Over Speed To Destruction !

Today morning I was reading the views expressed by the lady CEO of Axis Bank as published by a leading Indian business newspaper. She had opined that Indian Businessmen and entrepreneurs are intrinsically risk taking. So long as they are risk taking, there is not much problem for the banks to disburse their monies as business loans with potentials for good earnings.

On the other hand there are news in the media regarding the resignation of the lady CEO of an Indian Public Sector bank -the United Bank of India. This bank is burdened with a heavy non-performing asset or NPA. NPA is nothing but the unrecoverable loans of the bank. The bank officials perhaps had distributed heavy amounts as loans to many 'risk taking' entrepreneurs who had taken the risk of pleasing the bank officials with 'necessary' documents and the bank officials had in turn taken 'the risk' of clearing those loan applications expecting big success of the risk taking businessmen. But in this case, the risks actually became real and the money has become non-recoverable!

People are of essentially of two kinds. The majority are non risk taking and less adventurous. They will not risk their lives by venturing in to dangerous adventures. But then there are another group, a minority who are risk taking and adventurous in nature. They are the brave men and women of our world. They are the ones who move ahead for achieving their goals. Their goals could be anything. Exploration, travel, sport, business, politics or anything of that sort. In these, business and political risk taking are a bit different from the others as these two are determined by what is known as greed. The greed for money and power! 

The minority of people who are greedy for money and power too are essentially risk taking in their nature. However, their risk taking nature is not only detrimental to them, but also catastrophic to several others whose lives are directly or indirectly dependent on them. 

The risk taking politicians could drive the entire nation and its people to miseries for generations. Businessmen manipulate money, men and materials (the so-called 3 M's of management) for making more money while trapping more men and materials. In their high enthusiasm and high ambition many of them set high and achievable targets for them to accomplish. They dislike the word, impossible. For them there is nothing impossible. If there is a will, there is a way. That is what they prefer to believe!

Short and long term success of some others are their examples that they wish to emulate. Per se, it is not something bad. But what actually happens to such people is the manner in which impatience becomes too visible in their actions and decisions. They fail to recognize the fact that impatience is a mind poison.

Thus their business enthusiasm and ambition become poisoned by impatience. Impatience for achievement of high targets. Impatience for doing things or achieving results in the shortest time. 

What happens when you drive a vehicle at 100 km/hr speed when the road conditions do not permit you to drive more than half that speed? Even when your vehicle is capable, you are bound to make accidents and destroy your vehicle and yourself! But if you happen to be a good driver who knows well about your vehicle, the road and the rules, you would not venture into such an adventure of over speeding.

In a similar way, there are over speeding businessmen and chief executives who try hard to push their business organizations to impossible tasks and performances. It they are knowledgeable about the intricacies of the business and their business organization (the company or the firm that they manage or own) they may not take such a risk that might eventually cause great harm.

Unfortunately, in the world of high competition that we have today, there are chances that the businessmen and their chief executives are mere manipulators who are not competent in many other aspects of their own business processes. They may be good in one or two aspects but not in all. Since they are successful in their own areas, they tend to consider other areas of work also to be like their own and force others to fall in line without realizing the consequences.

Let me explain this by a simple hypothetical example. Imagine that there is a real estate developer.He is not a technical man but he knows the technique of getting the land purchased and also getting the approvals from the statutory authorities by hook or crook. He has experienced that the approval process which takes usually a few months time got reduced to a week because he could 'manage' the authorities. He had seen that the architect who asked for three months time to develop the drawings finally agreed to give all the drawings in a month's time when he put sufficient pressures including some inducements. But in this process he failed to understand that the drawings the architect now supplied were some quick copies with some quick manipulations and not something specifically made for him by applying proper mind. The result was that this builder was going to spend much more money, efforts and time to complete the work later, though he apparently made a quick success to get the drawings much earlier.

In a similar manner this builder could force the civil contractors to speed up the work to such levels which are neither practical nor technically justifiable. If he forces them, they are likely to adopt short cut methods in construction to speed up the work. They may even start building the higher floors without giving enough time for curing of the lower floors or reinforced cement concrete (RCC) construction. This could cause heavy structural weakness  to the building which might even cause total failures some time later. If that happens, this builder might even land in jail. But if he a risk taking sort of a man, these eventualities may not deter him. He would proceed in a haste and make some quick bucks. If nothing serious happens, that becomes his benchmark of success. 

The organizations of today's world are more and more getting created or managed by people of this sort- the so-called successful leaders who maintain their success projected by hook or crook till proved otherwise by some untoward happenings. Since organizations are more and more getting responsible for the economic activities of people, their failure is bound to affect people adversely.

Organizations are essentially to ensure long term sustainability of collective work and activity of people and hence they are supposed to last for a few generations. If organizations are created only to disintegrate in a few years, that is not a desirable thing and if it happens too frequently, it is a sign of ill health of the society or the nation where it belonged.

If organizations are disintegrating, it is often the top directors or top executives of the organization who are responsible for such breakups. And often, it is the suicidal risk takers at the top decision making levels who are responsible. They are like the captains of the large ships who pilot the ship to destruction and escape using the only one life boat in the ship leaving the rest in the ship and the ship to destruction. The maritime laws consider this as a punishable offense. Unfortunately, the captains of large organizations who do such acts to destroy their organizations are not often taken to task.

It is a serious issue and the right thinking should think about it for some solutions.

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