POM Class 8

"Every man's ability may be strengthened or increased by culture."

                                                              ---- John Abbott (Former Canadian PM)

THE ALIBABA GROUP

    

             We started the class with a discussion on the AliBaba Group. AliBaba Group is a privately owned China-based family of Internet-based eCommerce businesses thatcover business-to-business online marketplaces, retail and payment platforms, shopping search engine and data-centric cloud computing services. 

The company was started by Jack Ma based on the simple realizations that he had:

    1. I don't have the money.

    2. I don't have a plan. 

    3. If you can't use the internet in this age, you are useless.

What was Jack Ma's objectives with AliBaba?

    (a) Empower SMEs through the power of the internet.

    (b) At least 80% of these SMEs who are working with AliBaba MUST grow unimaginably.

    (c) 0.0001% of the shares of AliBaba must be enough to support generations together.

 What was the result?

              Today AliBaba's consumer-to-consumer portal Taobao (similar to eBay) features nearly a billion products and is one of the 20 most-visited websites globally. Alibaba Group's sites account for over 60% of the parcels delivered in China.                 

ORGANIZATIONAL CULTURE

  

                Organizations, just like individuals, have their own personalities—more typically known as organizational cultures. Understanding how culture is created, communicated, and changed will help you to be a more effective manager. But first, let’s define organizational culture.           

 

Just as water is invisible to the fish swimming in it, yet affects their actions, culture consists of unseen elements such as assumptions and values that affect organizational life.

             Organizational Culture encompass the values and behaviours that contribute to the unique social and psychological environment of an organization.

Organizational Culture is also called Corporate Culture

Organizational culture includes an organization's expectations, experiences, philosophy, and values that hold it together. It is expressed in its self-image, inner workings, interactions with the outside world, and future expectations. It is based on shared attitudes, beliefs, customs, and written (sometimes) and unwritten rules that have been developed over time and are considered valid. 

                   There are various types of organizational cultures. We discussed a few of them in class. I am listing them below:

1. Open Culture - One where employees are motivated to voice their values-driven concerns regarding problematic business practices. An open culture helps to counteract any occasional lapse into passivity at the board level or on the part of institutional investors.

2. Safety Culture - One where safety is  ALWAYS first no matter what the cost. A safety culture is one were all employees are proactive in ensuring safety at work place. People immediately report any perceived short comings in the work place safety and in the safety of products given to customers or clients.

3. Quality Culture - A culture where utmost importance is given to the quality of the product or service being rendered. Volume takes a back seat. So does cost. Batch recalling of cars/computers when defects are found is a good example of the quality culture. Toyota is a notable example.

4. Performance Culture - We could also call this OUTCOME ORIENTED CULTURE.  This is one that emphasize achievement, results, and action as important values. A good example of an outcome-oriented culture may be the electronics retailer Best Buy. Having a culture emphasizing sales performance, Best Buy tallies revenues and other relevant figures daily by department. Employees are trained and mentored to sell company products effectively, and they learn how much money their department made every day.

5. Ethical Culture - A culture where great importance is given to ethical business practices and this importance is seen at all levels in the organization. We see that in such organizations, ethics are given precedence even if being so may lead to a loss of business and profit. The TATA Group is a good example to note.

There are three aspects to organization culture, namely :

         (a) It is something that is practised by MOST of the people in an 
              organization.

         (b) It is something that is practised MOST of the time.

         (c) It is something that is DEEPLY believed by the employees.

Many thoughts about organizational culture came out in class. I am finding it a little hard to organize them into meaningful sentences and paragraphs. Therefore, I am giving these thoughts in point-wise form without any specific order or precedence. The various point we discussed where:

1. Organizational Culture leads to enhanced performance.

2. Organizational Culture is an important motivating factor.

3. Organizational Culture is depended on the type of structure which the
    organization follow. Flat Organizations have a different structure from more
    Hierarchical ones.

4. Organizational Culture is not STATIC. It changes from time to time.

5. Organizational Culture is invisible.

6. Organizational Culture is usually inferred. There is no book from where to read
    about it.

7. Organizational Culture - usually - is not documented. It is separate from the
    rule book. In fact, we could argue that if culture were to be written down then
    it would lose its impact.

8. Organizations can have multiple cultures of sub-cultures.

9. Organizational Culture can be WEAK or STRONG.

This sums up the entire learning for this class. More in my next blog post!!!! 

POM Class 7 - Part 2: Mohammed Yunus and the Grameen Bank

              Before coming to class we were asked to watch a video. Against all odds – for the first time in my life – I actually completed a homework before going to class!! Of course, there is a good reason why I watched the video. It was a speech by a person I was well aware of – Mohammed Yunus of Grameen Bank, Bangladesh. Before delving into what I learnt in class, I believe a small introduction is required.

          The Grameen Bank is a community development bank started in Bangladesh. They give small loans (known as micro credit or "grameencredit" ) to poor people without asking for collateral.The system of this bank is based on the idea that the poor have skills but have no chance to use their skills without some money, that is their skills are under-utilised. Most of the banks loans go to women.

             The Grameen Bank was started 1976 when Professor Muhammad

Muhammed Yunus at the World Economic Forum

Yunus, a Fulbright scholar and Professor at University of Chittagong, researched how to provide banking for the rural poor. In October 1983, the Grameen Bank Project was made into an independent bank by the government.The group and its first member, Muhammad Yunus, were awarded the Nobel Peace Prize in 2006. Grameen Bank is owned by the people who borrow the money, mostly women. The borrowers own 94% of the bank, and the other 6% is owned by the Government of Bangladesh.

                I am embedding the video we were asked see below. Watch it, it's worth your time. It will also give some context to what happened in class and the key learning I had.

                 Our class did not focus solely on aspects of social business. Instead – being a Principles of Management class – we focused on the difference in style of management and in delivery of product. We started out by discussing the difference between a traditional banking system and the Grameen micro-credit system. For the sake of simplicity, I am tabulating the differences below:

		TRADITIONAL BANKING	GRAMEEN BANK
1.	Purpose	Maximising Profit (Profit Motive)	Reducing Poverty
2.	Collateral	Needed. Without which no loans will be given.	No collateral needed
3.	Ownership	Businessmen – Rich People	By the Poor
4.	Loan Amount	Large Amounts	Very Small Amounts
5.	Type of Lending	To individuals	To small groups of people – Solidarity lending
6.	Type of Interest	Usually Interest is compounded	Simple Interest
7.	People Money given to	In most developing countries there seem to be a bias towards men.	Women are the primary focus. In fact women make up 97% of Grameen Bank Customers
8.	Location	Primarily located in urban areas	Primarily located in rural areas

              In my last blog, I wrote about Management by Objective and Organisational Structure. Both these contribute to another phenomenon – Organisational Culture. Basically, it is the behaviour of humans who are part of an organisation and the meanings that the people attach to their actions. Culture includes the organisation values, visions, norms, working language, systems, symbols, beliefs and habits.

                       The culture at Grameen Bank is to find ways to eradicate poverty. The Managing Director of the bank is not asked, “Why are Profits down?”. Instead he is asked, “How many people have you taken out of poverty today. It is precisely this culture that has allowed the Grameen Bank to achieve so much.

              This is the most important take away from this class. It is the Organisational Culture that motivates employees to perform well. It is the Organisation Culture that affects the way people and groups interact with each other, with clients, and with stakeholders. It is the Organisational Culture that gives the organisation Branding.

POM Class 7 - Part 1: NAVRANG Puzzle

(Please note that I have written in detail about Mohammed Yunus and the Grameen Bank in my next blog. I believed that the subject was quite important and hence deserved a separate blog post rather than to be lost in the clutter.)

                  I have never seen the NAVRANG Puzzle before. So when Prof.Mandi bought one into class, I must frankly say that I was a little puzzled (pun intended). The basic objective of the Navrang Puzzle (as Sir told us) is to get all 9 colours on all 6 sides.

The Navrang Puzzle

Unlike a standard Rubik's Cube, the Navrang Puzzle can be dismanteled and reassembled. We were challenged to find an algorithm or method to reassemble the Puzzle in order to reach the intended objective. After a few desperately minutes of thinking a few fast thinking Samaritans devised a plan (I was completely lost!!). Unfortunately, the plan didn't work too well.

               But then Prof.Mandi solved the Puzzle in about 2 minutes using an well-defined method. Sir had used a 3-step algorithm. It is here we were introduced to two important concepts: (a) Organizational Structure and (b) Unity of Objective. Before going on further about what happened in class, I believe a short introduction to these ideas are needed.

           An Organizational Structure consists of activities such as task allocation, coordination and supervision, which are directed towards the achievement of organizational aims.An organization can be structured in many

Unity of Objectives

different ways, depending on their objectives. The structure of an organization will determine the modes in which it operates and performs. This of course leads us to the next idea. Unity of Objectives stands for the philosophy according to which every individual and every process in an organization should aim to fulfil the organization's Objectives and Mission Statement.

                   Now, leveing the jargon behind, let me continue with my experiences in the class. Prof. Mandi related the above two concepts with the structured solution he had shown for the Navrang Puzzle. Given below is a video of how to solve the Navrang Puzzle:
 

             The most important step was to understand is that without an objective, this puzzle would never have been solved. It is the objective that determines the method in which we have to solve the problem. Any method we device, it must be capable of being easily replicated. Only then can we achieve economies of scale and get effective outputs.

 

POM Class 6

“The achievements of an organization are the results of the combined effort of each individual.” ---Vince Lombardi

          Magnets are fascinating things. Every time we see a magnet we are tempted to plat with it. It was therefore a pleasant surprise to see Prof.Mandi walking into class with a chunk of magnet and ask us, “Why does a magnet attract?”. After many botched attempts by us at giving a good answer, one person in the class was finally able to say the right ward – Alignment.

          A Magnet has its power because it can align innate magnetic forces in metallic atoms. So, magnets (or Physics for that matter) align natural forces . A Manager aligns human forces to get work done. In effect an organization is a force that is aligned. The bigger or better an organization, the more perfectly it is aligned.

          Managers align people and power. They align tasks and objective. They synchronize both time and space. Management is Music, not noise. It is like the conductor of grand orchestra, where each instrument contributes to harmonious music. So here we come to a very important management lesson – Management by Objective.

         Management by objectives (MBO) is a process of defining objectives within an organization so that management and employees agree to the objectives and understand what they need to do in the organization in order to achieve them. The term "management by objectives" was popularized by Peter Drucker in his 1954 book The Practice of Management.

         The essence of MBO is participative goal setting, choosing course of actions and decision making. An important part of the MBO is the measurement and the comparison of the employee’s actual performance with the standards set. Ideally, when employees themselves have been involved with the goal setting and choosing the course of action to be followed by them, they are more likely to fulfil their responsibilities.

         For greater clarity on the topic we compared two different styles of management we had previously studied in class – the blindfolded tower building and the three monk collaborative water collection. The major lessons we drew could be summarised in the table shown below.

	Blind Tower Building	Three Monk Collaboration
1.	Hierarchical set-up	No Hierarchy
2.	Control with Top Management	Consensus among all
3.	Management Present	Management absent and replaced by autonomous management/ maintenance
4.	Control Mechanism	Consensus Mechanism
5.	Loading is High and Low	Loading is more or less equal

          We ended our discussion by comparing two Indian Sporting giants and understanding why they were unable to cooperate and work. We concluded that the main reason was a skill set mismatch. Multiple skills COULD come as a disadvantage as the ability to exercise choice comes into the picture. Management should figure out which all skills to hone & nurture and which all to get rid of or discourage.

          The most important take away in today's class is – without any doubt – the concept of MANAGEMENT BY OBJECTIVE.

POM Class 5

"One monk will shoulder two buckets of water, two monks will share the load, but add a third and no one will want to fetch water." --- Ancient Chinese Proverb

          Cartoons have always been a very effective medium for communicating ideas. So it piqued my interest when the class was asked to watch a cartoon as part of preparation for a class. I watched the cartoon (roughly 15 minutes) with a bit of curiosity and as usual it did not disappoint!!

          Let me quickly summarise the cartoon. A young monk lives a simple life in a temple on top of a hill. He has one daily task of hauling two buckets of water

Three Monks by the Shanghai Animation Film Studio

up the hill. He tries to share the job with another monk, but the carry pole is only long enough for one bucket. The arrival of a third monk prompts everyone to expect that someone else will take on the chore. Consequently, no one fetches water though everybody is thirsty. At night, a rat comes to scrounge and then knocks the candle-holder, leading to a devastating fire in the temple. The three monks finally unite together and make a concerted effort to put out the fire. Since then they understand the old saying "unity is strength" and begin to live a harmonious life. The temple never lacks water again as they have devised an efficient process to haul the water.

          In class, we started by analysing what happened in each case and by trying to understand the most effective method. Our discussions could be summarised in the table below:

	One Monk with Single bucket on head (M1')	One Monk with two Buckets (M1)	Two Monks with one Bucket (M2)	Three Monks in the work flow process (assembly line pulley system; M3)
Number of People	1	1	2	3
Effort	Most	A little less than M1'	Much less than M1'	Least effort
Output	Low	Higher than M1'	Less than M1	Most
Efficiency	Least	More than M1'	More than M1	Most efficient
Possible Reason	Less output with more effort	More Effort but also more output	Less Effort but more output	Least Effort and Most output

Team Work

               Our conclusion was that Team work and Synergy not only improves output but also reduces the effort drastically. Herein lies a very important management lesson. But we also cam across another characteristic, namely, collaboration. We see that a form of Industrial Democracy or Participative Management.

Participative Management

               Participative Management is a type of management in which employees at all levels are encouraged to contribute ideas towards identifying and setting organisational-goals, problem solving, and other decisions that may directly affect them. It is also called consultative management. This can actually boost both production and efficiency. It also leads to a much more healthier and happier work culture.

              To sum-up, the two most important takeaways from this class was : (a) Team Work and (b) Participative Management. And of course there is the old adage; United we stand, divided we fall....

I am adding the video of the cartoon which is available on Youtube.

POM Class 4

In George Bernard Shaw’s play Pygmalion (named after the Greek mythological character), Eliza Doolittle explains:

“You see, really and truly, apart from the things anyone can pick up (the dressing and the proper way of speaking, and so on), the difference between a lady and a flower girl is not how she behaves but how she’s treated. I shall always be a flower girl to Professor Higgins because he always treats me as a flower girl and always will; but I know I can be a lady to you because you always treat me as a lady and always will.”

Bernard Shaw's play Pygmalion

The greatest takeaway from today's class was the Pygmalion Effect. What is the Pygmalion Effect?  It suggests  that the success of their employees depends not only on qualification, personal qualities or working environment. Manager always has to believe in his people and expect them to achieve the best results. In such case the subordinates will always feel this trust and demonstrate their best skills and abilities in their work. The Pygmalion effect is also an important instrument in management theory.

Some managers always treat their subordinates in a way that leads to superior performance. But most managers (like Professor Higgins from Bernard Shaw's play) unintentionally treat their subordinates in a way that leads to lower performance than they are capable of achieving. The way managers treat their subordinates is subtly influenced by what they expect of them. If managers’ expectations are high, productivity is likely to be excellent. If their expectations are low, productivity is likely to be poor. It is as though there were a law that caused subordinates’ performance to rise or fall to meet managers’ expectations.

Fibonacci Spiral

            We could say that the Pygmalion Effect is a self fulfilling prophecy. A positive spiral improves our performance every iteration it take. It will expand our horizons and allow us the reach new heights much like Fibonacci Spiral.





Goals and SMART Goals:

"When it is obvious that the goals cannot be reached, don't adjust the goals, adjust the action steps."  ---- Confucius


The second most important takeaway was about GOALS. Goals are what make an organization move. It is the focal point which allows an organization to converge and do something great. An organization without a goal is like a person without a head. Its like a ship without a captain.

The primary objective of the management of any organization is to set goals. But goal setting isn't as easy as most people think it to be. There are various tools and techniques we could use to set effective goals. The most common of all these techniques is the SMART goal. This we discussed in class in great detail.

    

So, What are SMART goals? There are:

1) Specific:
Goal should be clear, unambiguous and to the point. It should be without vagaries or platitudes. The team must be told exactly what is expected, why is it important, who’s involved, where is it going to happen and which all attributes are important.

2) Measurable:
There should be a tangible criteria for measuring progress being made towards achieving a goal. Measuring progress helps a team stay on track and hit the required targets.

3) Achievable:
Goals should be realistic and attainable. While an attainable goal may stretch a team in order to achieve it, the goal is not extreme. Impossible goals can seriously demoralize the team and lead to extremely inefficient outputs. It will also do lasting damage to the organization.

4) Relevant:
Choosing goals that matter. Only goals that are relevant to the organization would receive the necessary momentum to go through to completion. Relevant goals when achieve bring positive output for the organization and inspires teams to do even better.

5) Time-bound:
And finally, Goals MUST be time bound. Goals achieved very late are not achievements at all. They are negative and drive down both credibility and business. This part of the SMART goal criteria is intended to prevent goals from being overtaken by the day-to-day crises that invariably arise in organizations. A time-bound goal is intended to establish a sense of urgency and importance.

So to sum up, my two great takeaway were : (a)The Pygmalion Effect and (b) The importance of SMART Goals. Awaiting more classes!!!!