India Inc needs new supply lines to address a leadership scarcity

Economists, political leaders and entrepreneurs alike are sanguine about India’s growth potential, predicting a GDP of up to $30 trillion in the next few decades. This confidence seems justified given our growing market size, demographic dividend and a shift of the global economic epicentre towards the East. However, if India has to scale ten times in its economic quest, then it needs more than just infrastructure and investments. It also needs exponential growth in its supply of leadership.

It is well-known that India Inc is desperately short of good leaders at virtually all levels. This acute shortage has many manifestations and indicators. Almost all organizations have several key leaders with more than one portfolio. CEOs and CHROs concede that not only are an alarming number of key positions understaffed, but also the suitability of personnel occupying many is under par. The executive search firm cliché that good talent is in high demand hides the reality that talent is very scarce. Strategic positions take several quarters to fill and executive compensation has been rising sharply largely because the same talent pool is cannibalized. This absence of a fully and competently staffed leadership echelon results in organizational friction, reduced velocity, lost opportunities and, of course, diminished growth.

The quantities produced by feeder institutions like business schools and engineering colleges are inadequate and barring a handful, their quality too is questionable. That corporates need to run extensive training programmes for entry-level talent, especially in leadership, creative thinking and real-world problem-solving skills, testifies to this deficiency. The profusion of mid-career executive education programmes is another. If this is the situation at current levels of GDP, how does India Inc envisage staffing its leadership cadres when demand increases tenfold?

This problem cannot be solved by throwing money at it. Sure, a few cash rich companies may be able to corner talent by increasing compensation, but that is a zero-sum game. New enticements like flexible hours, work from home or a sense of purpose, etc, only addresses the battle for talent within the same pool, with no supply increase. And unless supply rises, companies will price themselves into a tough corner regardless of how cleverly they hire.

The only scalable answer for India Inc is for companies to transform themselves into self-learning and teaching organizations, capable of producing adequate in-house leaders sustainably and cost-effectively. Leaders with different individual idiosyncrasies but a common set of values and purpose.

Arguably, India’s most diverse large organization is the Indian Armed Forces. Our army alone numbers 1.5 million soldiers in regiments and battalions based in their states of origin. Apart from the usual demographic, linguistic and cultural differences, every battalion has its own sub-culture. Soldiers may look dissimilar, speak various languages and have discrete cultures, yet if commanded “half turn right”, each would know it means exactly 45 degrees. An ability to let multiple cultures flourish within a singular operational vocabulary is vital to the success of any army. And it is achieved by addressing organizational building in a very different way.

First, training is right at the top in both the organization’s positional and social hierarchies. An army commander, a three-star general, no less, heads the Army Training Command. That’s a seat at the high table. Being an instructor is highly coveted, and without exception, most of the forces’ senior commanders have had multiple stint as instructors. Evaluation processes are designed to check if commanders are just good leaders or can they also teach others.

Secondly, all soldiers spend an overwhelming part of their time in training. It is time consuming, expensive and dangerous. And while the inevitable battle for budgets chips away, by and large, the training is of a very high calibre.

Thirdly, structural and central units serve as the lynchpins of this strategy. The Military Secretaries (MS) branch manages the career progression of officers, nominating leaders for career courses at regular cadence that cannot, barring extreme exigencies, be overruled by their superior.

Lastly, these career courses are designed and executed centrally under the training command that is responsible for its quality and appropriateness. Not only does it assure continual leadership development, but also helps forge joint-manship, which furthers bonds of trust. These central institutions are manned by leaders sent from fighting formations, thus ensuring that all leaders have experience of both operational roles and organizational building before being elevated to strategic roles.

Given differences of stakes and mandate, corporates cannot and should not replicate all that the armed forces do. And it is not as if the forces themselves don’t face challenges. However, there is definitely a need for businesses to consider a more firmly structured way of ensuring a leadership pipeline, not just for themselves, but also for the tens of thousands of their vendors. Because the one lesson we ought to learn from covid is that while hospital beds, PPE kits and respirators can be created within months, the leaders or doctors to helm them still take years to produce.

Raghu Raman is former (founding) CEO of the National Intelligence Grid, distinguished fellow at Observer Research Foundation and author of ‘Everyman’s War’.

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