Friday, January 12, 2018

The Invaluable role of “Chief Business Obstructers” in the modern corporate world

Darwins theory of evolution in its simplistic form says ‘The fittest survive and they fight to compete, survive and procreate’

Societies have evolved over generations where economic progression, education and character have all moved in a synchronous manner. Some of the most developed economies like the US, UK and France have had their fair share of tribulations such as wars, diseases etc but have demonstrated that they maintained their financial, military and intellectual hegemony from a global perspective.

Societies in the first world countries prided themselves with superiority and there was a race among these nations to establish themselves as a leader in one thing or the other. Inventions (technological, financial and medical) of every form happened in the western world.

So why did India get left behind so miserably, when evolution of homo-sapiens happened almost at the same rate/manner across the globe.

The answer lies in one word “Corrupted Greedy Character”

But this didn’t happen by design – it was the natural evolution of a nation where its large population zealously procreated and grew roughly 4 times from 350 mill to 1.3 billion in just 65 years.

And Darwin’s to blame majorly for the present character of this nation. Or at least his theory explains this at best.

Lets reflect objectively on the causal factors.

India can primarily be divided into 2 kinds of demographics Rural-Agrarian and Urban-Corporate.

The rural-agrarian have relied on limited means, producing and consuming and storing for the proverbial winters/rainy days – Simple.

The urban-corporate are living in small over populated cities with limited resources and infinite greed among themselves to survive, grow, hoard and procreate. Another phenomenon happened in the Indian sub-continent in the last 50 years. Indians were primarily fighting floods, droughts and starvation and suppression in the last 300 years, but the last 50 were marked by rapid economic developments, lesser vagaries of nature, economic development led by rapid and almost alarming shift from agrarian to services based economy and a large part of urban population having marginally more than required.

Yet the starvation gene (let’s call it the gene X) still continued to exist and despite the rapid progression, in last 50 years, on all fronts namely economic, medical, food, transportation and habitation, the gene X that encourages to hoard, be greedy and survive at all costs and mostly at other’s expense, persisted and didn’t mutate at the same fast rate as the economic development of this sub-continent.

That’s why Indians over eat and eat till they are proverbially full (read bursting after a meal). They are generally a dissatisfied lot wanting more than what they deserve or can actually earn.  And that explains why inspite of being a rather superior nation on many fronts, this subcontinent still behaves primitive, back stabs, in-fights on trivialities and sadly the educated in the so called corporate world spend majority of the time pulling the other one and the surrounding ones down because of a misplaced sense of depravation and insecurity that purports corruption, greed and above all ‘obstruction’.

And that catalyses the breeding of ‘Chief Obstruction Officers” in the corporate world too. Fair warning pls – no COO should feel attacked – we could even call these assets - Chief Business Obstructers or Chief Financial Obstructers. They are all the same. For brevity lets just stick to CBO’s

C N Parkinson wrote a powerful essay in 1955 that pretty much defined the expansion of bureaucracies in an organisation and how work aligns and expands itself according to people available for its completion and organisations are perpetually insecure. Every insecure company necessarily wants to have infinite multiple layers of inefficient CBOs to keep an alleged check and balance.

But lets talk of the role that these CBOs play in the fate of organisations.

These people have never actually handled a business in its true sense. (the corner shop paanwalas are better businessmen because they invest their own money and have a skin in the game). CBOs pretend to be confident, very knowledgeable, stretched on the chair as if on a hammock (during an official meetings – but that’s a body language that hides inferiority in the garb of stretched posture), their condescendence and pretentiousness would put thought leaders such as Kotler and Prahlad to shame

Nothing amuses me more than seeing people from disparate backgrounds, accidentally landing themselves in position of authority, pretending to be Prahalad’s reincarnation, aspiring to make a mark without an iota of responsibility, assuming authority because no one questions, pretending to have a connection with GOD (when God least cares), and then start preaching on topics and industries – of which they have no knowledge.

We call them “Chief Business Obstructers”
 
A friend was sharing his personal experience when he used to run a business that grew 5-6 times in 4-5 years. Customers were happy, colleagues were thrilled, profits were good. So much so – the growth rates encouraged his company to start thinking IPO. Nothing gives an executive more joy when peers in the industry start talking about small businesses that become a formidable force and everyone starts talking of these small businesses as the next big thing.
 
Enter – “The Chief Business Obstructor”

Corporate world is funny – everyone pretends to abide by Thomas Bertman’s adage “don’t fix it – if it ain’t broken” yet no one practices it indeed. On the contrary system gives authority to incompetent people who know nothing about a business and these wise men try and fix every single thing that’s not broken - till the business is on its  knees, is on ventilator support and eventually breaks down.

Corporate world is replete with examples of excellent businesses that tried to do a lot when nothing was required to be done and businesses and leaders who did nothing when a surgical intervention and action was required.

But there are clear and distinct signs that leave a trail of evidence, sometimes discovered much later (similar to the tail effect of a comet) when its too late, that sow the seeds of demise of well run, well managed, perfectly fine companies irrespective of their size.

I spoke to about 9 different C and D level executives and have endeavoured to summarise below the signs we must look out for – if we care for the longevity of the companies.
  1. When setting up businesses do not allow the old loyalists from other divisions (who have no freaking clue of the new businesses) to opine.
  2. Keep things simple – Product , Market, Marketing, Sale, Customer, Customer Service. This is all that matters. Anything beyond that is all farce.
  3. Always almost make your projections keeping a buffer for difficult and unexpected times. Microsoft excel is a wh@#e – you can titillate it to whatever extent. It almost always fakes in real life.
  4. Every executive who leverages the company, must be locked in (by hook or crook) into company’s employment for the length of the debt. Else the promoter will be left with the hot potato at the end while the executive would have taken his/her hefty bonuses and digested. Does this sound like Fuld?
  5. Executives who fix up meetings 4 times a week on disparately different subjects – Weekly updates, strategy for the week, strategy for the month, long term strategy probably need to be fired immediately because they have nothing better to do and are only trying to establish their relevance at the cost of some other business and someone else’s time.
  6. There is a trend to ask for weekly monthly and yearly cash flows week after week after week as if the flow of cash is the living account of the flow of bile of the Chief Business Obstructer.
  7. To establish their own importance, some CBOs suffocate the businesses of cash to an extent that their artificial importance gets established as if they are The Fed and 90% of the time of the business is spent in making excel sheets or symbolically accounting for the CBO s bile.
  8. When reviewers start commenting on everything that they don’t have info about and keep showing the business and its CEO in questionable light just to justify ones’s 8 figure salary and pretend to be custodians of the business – pls definitely get wary.
  9. CBOs ensure that the business doesn’t have enough money to even pay its salaries while they are happily gloating in the warmth of their annual bonuses and planning trips across the globe.
  10. CBOs unleash a volley of 20 something’s analysts, seeking data from companies with the sole purpose of making themselves and CBO’s look like saviors but in reality setting a rot of mission fatigue within the organisation.
  11. Pretend to be owning the business at someone else’s expense, without investing a penny and feigning ignorance when shit hits the roof and finding someone else to blame.
The few reasons why a handful of businesses have survived over ages are – when..
  1. Owners and CEOs have trusted a handful of performing executives over long periods of time.
  2. Businesses aren’t judged week on week but are judged year on year and brand-on-brand and reputation-on-reputation and happiness-on-happiness (teams and customers)
  3. Owners don’t allow fraudulent people with all authority and no responsibility to exist in the system without any measurable accountability.
  4. Owners call-out the fakery by converting the hefty bonuses into equity and making these well-wishers participate in the success/failure of the company.
  5. The fundamentals of running a business are kept simple where cash is king and debt is death.
  6. Businesses aren’t enamored by the western style of cash flow discounting and valuing the future elusive cash into present ongoing party.
  7. HBR in a series of popular blogs have lauded the Indian baniya style of doing business and has given an infinite importance to collaborative culture and care for all.
  8. Businesses are managed with lean teams that are empowered and productive and not meeting 10 times a week to discuss strategy when none really exists. Take for instance Berkshire Hathway's office in Omaha that manages 510 Billion in marcap of businesses with a handful of 25 employees.
  9. And lastly….
  10. Rather than reinventing the wheel of management styles – unconditionally back the performers, remove the flab and rapidly weed out the fakers.

Manu also writes for HuffPost

8 comments:

  1. The mostly commonly used words these days are fraud and fake..
    Gupta has nicely summirsed.. the falseness prevalent in corporate management of projects. The truth laid bare.
    Should be shared with the B school boys..
    Keep writing Sir..

    ReplyDelete
  2. Succinct & ironical that the CBO are blissfully unaware of their redundancy but big corporate giants would be ostriches if they dont downsize and take strict action on attrition in this age of the ...If u dont mind me adding to the CBO a special footnote....CBO-LITAOTS ...CHIEF OBSTRUCTING OFFICERS who LIVE IN THE AGE OF THE STUPID !!
    Bravo Manu

    ReplyDelete
  3. Succinct & ironical that the CBO are blissfully unaware of their redundancy but big corporate giants would be ostriches if they dont downsize and take strict action on attrition in this age of the ...If u dont mind me adding to the CBO a special footnote....CBO-LITAOTS ...CHIEF OBSTRUCTING OFFICERS who LIVE IN THE AGE OF THE STUPID !!
    Bravo Manu

    ReplyDelete
  4. On the CBO's of the world I agree, hope many people would read your piece and afflicted businesses will take note.

    While I agree to some extent about your biting (almost angry) comments on the average Indians...I would have liked you to delve deeper to understand the possible causes that resulted in who we are...for example the ruthless suppression of Indian industry, of age old business practices, economic systems, trade centres and local trade in general by the British for nearly two centuries....famines were not entirely caused by natural means....and affect of the same does take generations to get rid of....even in 21st century we speak of 'rukhi sukhi roti'... because that's what many of our ancestors hoped for daily...and, unfortunately many still survive on the same....

    Of course some businesses thrived; many businsses built on money lending, salt, indigo, jute, cotton, opium trade under the protection of their British bosses (and sometimes partners) today are MNC's..

    Perhaps another piece with a historical perspective?

    ReplyDelete
  5. Very well written and well analysed

    ReplyDelete
  6. Big fan of your writing sir. We Try to incorporate every bit of your advice in our small business.

    ReplyDelete
  7. This is really awesome Manu. I’m sold on point 2 and resonate with everything you say. The minute the corporate jargon is out, my hackles are up !!

    ReplyDelete
  8. Thanks for your personal marvelous posting!
    I truly enjoyed reading it, you happen to be a great author.
    I will ensure that I bookmark your blog and will come back
    later on. I want to encourage you continue your great
    posts, have a nice weekend!

    ReplyDelete

Your comment is immensely appreciated and will be published for a discussion - soonest. Thanks. manu

 
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