Executive Development 9789350432938, 9789350243695

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EXECUTIVE DEVELOPMENT Prof. M. N. RUDRABASAVARAJ PRESIDENT & EXECUTIVE DIRECTOR, MNR ASSOCIATES PTE LTD. SINGAPORE. FORMERLY PROFESSOR OF MANAGEMENT, VAIKUNTH MEHTA NATIONAL INSTITUTE OF COOPERTIVE MANAGEMENT, PUNE. PROFESSOR & HEAD OF DEPARTMENT OF. MANAGEMENT, PSG COLLEGE OF TECHNOLOGY, COIMBATORE AND VISITING PROFESSOR OF HUMAN RESOURCES MANAGEMENT, JAMNALAL BAJAJ INSTITUTE OF MANAGEMENT, MUMBAI.

ImI GJIimalaya CflublishingGJIouse MUMBAI • DELHI • NAGPUR • BANGALORE • HYDERABAD

©

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ISBN

: 978-93-5024-369-5

Revised Edition :2010

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CONTENTS

ISTATEPART· I I OF THE ART I.

Management Philosophy Towards Executive Development

2.

Executive Development Policies

1 - 208 3 -7 8 - 11

3.

Objectives of Executive Development

12 - 14

4.

Top Management and Executive Development

15 - 17

5.

Organisational Climate

18 - 24

6.

Executive Resources Planning

25 - 38

7.

Executive Recruitment, Selection and Induction

39 - 66

8.

Executive Performance Appraisal

67 - 87

9.

Perception of Executive Development Needs

88 - 91

10.

Strategy of Executive Development

92 - 143

II.

Executive Training and Development Techniques

144 - 146

12.

Executive Development Support System

147 - 148

13.

Executive Development Facilities

149 - 150

14.

Executive Development Faculty

151 - 154

15.

Utilisation of Trained Executives

155 - 156

16.

Evaluation of Executive Development

157 - 173

17.

Executive Development Responsibility

174-175

18.

Executive Development Research

176 - 178

19.

Executive Development Organisation

179 - 186

20.

A Balance Sheet on Executive Development An Interim Appraisal

187 - 191

Summary and Conclusions

192 - 208

2I.

I PART - II I Management of Executive Development -

209 - 376 A Model

209 - 210

22.

Executive Development Concept

211 - 225

23.

Systems Approach

226 - 253

24.

Executive Resources Planning and Procurement

254 - 273

25.

Unified Strategy of Development

274 - 353

26.

Cost-Benefit Analysis

354 - 358

27.

Breaking in the Management Trainees

359 - 371

28.

Management Commitment

372 - 376

"This page is Intentionally Left Blank"

PART-I

STATE OF THE ART

"This page is Intentionally Left Blank"

1 MANAGEMENT PHILOSOPHY TOWARDS EXECUTIVE DEVELOPMENT We began our study by asking the top executive of the organisation about the company philosophy towards executive development. Whether there was any written statement of company or management philosophy or whether there was any set of basic approaches or beliefs or principles or policies that could constitute a constructive operational philosophy towards growing executive leadership. The philosophy is the guiding spirit behind all other programmes and practices. In other words, if you believe in a management philosophy, then all your plans and courses of action will be guided by the philosophy. This, of course, requires strong beliefs, convictions, and commitment to principles. Good organisations under the leadership of great organisers have always developed, stated, communicated their management philosophy and also lived by it. I Out of 12 respondents, half of them (6 or 50%) stated that they do have a philosophy which guides their executive development effort. Out of 6, some 3 organisations are foreign and they stated that their parent companies have developed and stated their philosophy towards executive development. The exact statement of their company philosophy was not available. However, the chairman of one of these companies, Mr. P. L. Tandon, mentioned his company's basic approach in his speech, completely devoted to the subject of management development to the annual general

4

FXECUTIVE DEVELOPMENT

meeting. He observed : "AltJ- .)Ugh founded by the genius of one man, our parent company has always been professionally managed. This has been a strong tradition with us and one we have valued in Hindustan Lever. We have always bestowed a lot of care on the proper selection, training, development and promotion of men and women; we have looked ahead at our needs, foreseeable and unforeseeable, and tried to provide for them before they arise. Nearly twenty years ago, as an instance, we appreciated the need for Indianising our management and the process was handled with care but with boldness till it ceased to need any further impetus some years ago. Over twenty years ago we began our Management Trainee selection scheme, which over the years has with attention and assimilation of new techniques improved until todilY it stands high by international standards. Opportunity for men from the general staff to rise to management has been another of our conscious efforts. We have today 341 managers of whom 178 or 52 per cent have risen from the ranks; a total of 11 or 3.2 per cent are expatriates; our selection and training department in 1963 recruited 26 managers and put through training courses as well as 17 nonmanagement staff. 5 from the staff were promoted to management. Our management strength forrns 5.2 per cent of our total employees .... Although essentially a manufacturing and marketing company, we have 27 women managers, who interestingly possess a diversity of specialised skills like psrchology, operational statistics, scientific research, accountancy and home economics." The other 3 organisations, one Indian (Steel) and the other two foreign (chemicals and tobacco) have not evolved a separate management philosophy towards executive development; nevertheless their corporate philosophy embraced this vital area also. We shall present the written statement's of management's philosophy of these companies. (a) Objectives The objective of this organisation is to manufacture and distribute dry cells and batteries, flashlight cases, zinc, carbon and metal products, plastics and chemicals, insecticides and agricultural chemicals of high quality, to its customers in India and abroad, at the minimum price which will return a reasonable profit to the company. The company will expand and diversify its activities and product lines in order to meet the needs of its customers, to render better service, to obtain better quality or to effect economies in operation. (b) Supporting Objectives To maintain the company in a sound financial condition and to obtain for the stockholders a fair and proper return on their investment, commensurate with the risk involved. To provide its employees with good working conditions, to pay wages and salaries in line with those prevailing in similar industries for similar work requiring the same degree of responsibility, experience and skill.

To provide as steady and secure employment as conditions permit. To comply fully with all requirements of law in every phase of its operation and, in addition, to discharge its moral and social obligations to the Government of India as well as to the localities in which its operates. This Company will support and strengthen the Indian economy and the Government of India in order to assist in every way possible the economic development of the

MANAGEMENT PHILOSOPHY TOWARDS EXECUTIVE DEVELOPMENT

5

country. Recognise and respect the dignity of work of each of its employees and assist in the development of his potential abilities, pursue a long range point of view in all of its decisions and actions. Similarly another excellent statement of a company philosophy and objectives comes from the well-known TISCO (Tata Iron and Steel Company) which actually reflects the values and philosophy of that industrial pioneer, Jamshedji Tata. This statement again highlights the personnel philcsophy of TISCO and it is as follows:

STATEMENT OF OBJECTIVES OF TISCO The fundamental objective of the Tata Iron and Steel Company is to strengthen India's industrial base through increased productivity, effective utilisation of material and manpower resources and continued application of modem scientific and managerial methods as well through systematic growth in keeping with national aspirations. The Company recognises that, while honesty and integrity are the essential ingredients of a strong and stable enterprise, profitability provides the main spark for economic activity. It affirms its faith in democratic values and in the importance of the success of individual, collective and corporate enterprise for the economic emancipation and prosperity of the country. Guided in its policies and objectives by the philosophy and ideals of its Founder, Jamshedji Tata, the company believes in the effective discharge of its duties and obligations towards: I. Shareholders (i) by protecting and safeguarding their investment; and (ii) by ensuring to them a fair return.

II. Employees (i) by a realistic and generous understanding and acceptance of their needs and

rights and enlightened awareness of the social responsibilities of industry; by providing adequate wages, good working conditions, job security, an effective machinery for speedy redressal of grievances, and suitable opportunities for promotion and self-development; (iii) by promoting feelings of trust and loyalty through a humane and purposeful awareness of their needs and aspirations; and (iv) by creating a sense of belonging and team spirit through their closer association wtm. management at various levels. (ii)

III. Customers (i) by providing products of proven quality at a fair price; (ii) by fulfilling its commitments impartially and courteously in accordance

with sound and straight-forward business principles; and (iii) by earning their continuing confidence in its productive ability and its technical competence to keep improving the quality of its products.

EXECUTIVE DEVELOPMENT

6

IV. Community (i) by respecting the dignity of the individual and acting according to the ideals of social justice; (iO by encouraging talent and promoting civic sense among members of the

community; (iii) by availing of opportunities to develop the democratic qualities involved in

collective work undertaken in the interest of the community; and (iv)

by assuming its proper share of social responsibilities in the community in which the Company operates.

These policies and objectives are directed towards making The Tata Iron and Steel Company Limited: The best company to buy from. A sound company to invest in. A good company to work for. A reliable company to sell to. A leading company in the life of the community and the country. One of the top executives of TISCO maintained : "Our entire personnel is very different from that of others and our attitude towards our employees also is very different. Our whole philosophy is to treat the individual as a whole man and to provide opportunities to our employees for development not only within the company but also without." philo~>ophy

In the case of the other foreign controlled organisation, the Chairman Mr. A. N. Haksar, enunciated the following corporate philosophy of pursuit of self-reliance. 3 "It is appropriate at this time, when India is reviving from an unfortunate recession, to analyse company past performance to prepare for the challenge of the future so that your company can contribute to play its part in the economic development of the country. Long acknowledged as the leader of the Indian tobacco industry, your company endeavours to discharge the responsibilities that devolve on a leader; to India's economy as a healthy, progressive industrial unit operating in consonance with the national needs and aspirations; to the consumer by constantly striving to bring him better products for his money; to the employee by offering him just reward for a job well done and the environment to do it in; to the shareholder fair profits arising from sound management.

. . .. But more important than numbers is the philosophy of your company regarding human being in the work place; that workmen should have just reward for a job well done. Your Company is the leader in the industry in sharing with its workmen the benefits of improved productivity. It firmly believes in collective bargaining and, in those units where Unions did not exist, it encouraged to be formed; indeed your Company was one of the first to produce Long-term Agreement with its labour in this country. Your company offers careers to its workmen rather than employment. They enter through a rigorous attitude test, are constantly assessed and have opportunities for advancement upto positions of supervisory and managerial responsibility and for example, at this moment as many as 33% of your Company's management have come up from the unionised cadres.

MANAGEMENT PHILOSOPHY TOWARDS EXECUTIVE DEVELOPMENT

7

National Management Development

Men and resources have to be managed and, other things being equal, the competitive success of your Company depends on the quality of its management. If I can once again repeat the refrain of my speech, in pursuit of self-reliance, your Company has been in the forefront in selecting and developing nationals of the country to fill the managerial cadres and today only 5% of the managerial positions are filled by expatriates, most of whom are nearing retirement. This has been achieved through India-wide selection of people who undergo a most rigorous selection procedure and are then developed thing given responsibility on the job supplemented by training courses held at the Company's Branches, its training centre (incidently one of the first in India) at Calcutta and through the assistance of our international connections with the majority of your company's Board are nationals of this country which is a testimony of this constant process of development. It is perhaps worth mentioning that, having at one time imported the technology for training and developing managerial skills, your Company is today investigating the possibility of offering '"certain training facilities to members of management in Companies in the eastern hemisphere also connected with the same international connections as your own Company." The majority of our sample respondents (7 or 58%) state that they have not evolved a management philosophy yet. A top executive of one of these companies was pretty forthright when he asserted: "The top management of our company has never sat and thought out and spelt out a philosophy that each individual must be treated with dignity. The seventies are a decade of training and executive development. The top people believe that if you don't have a training manager and some training, they think they are not progressive enough." It is quite unnecessary to belabor the point that executive d.evelopment effort sans a constructive operational philosophy can be compared with the erection of a building without a blue print. A management philosophy provides the vision, a grand design and a sense of direction to the entire executive development effort.

REFERENCES 1.

2. 3.

See M. N. Rudrabasavaraj, Personnel Administration Practices in India, Vaikunth Mehta National Institute of Cooperative Management, Pune, 1969, pp. 300-304. P. L. Tandon, Management Development at Hindustan Lever, speech to the annual general meeting at Bombay in December, 1964, p. 3. A. N. Haksar, Pursuit of Self-Reliance, speech at the Fifty-eighth Annual General Meeting of the Company in 1969.

LJ

LJ

LJ

2 EXECUTIVE DEVELOPMENT POLICIES There are no formalised statements of executive development policies in the majority of the respondent organisations (7 or 58%). Nevertheless there are some broad guidelines that serve these organisations as policies to be followed in this area. Out of these 7 organisations, 3 indicated that they are working on a statement of policies. Some 5 organisations (rubber, tobacco, foods, oil and chemicals) do have executive development policies which are formulated by the parent companies abroad and which are followed here by these organisations in this country. It is interesting to note that the almost universally used executive development policies which are formulated by the parent companies abroad and which are followed here by these organisations in this country. It is interesting to note that the almost universally used executive development policies are to provide opportunities of advancement and growth to the employees and to follow a policy of promotion from within and to provide opportunities of training and development over a period of time both on-the-job and off-the-job. The top executive of one of our respondents (rubber) put it very succinctly: "It is our declared and dedicated policy to develop people from within as far as possible to assure a steady source of supply of competent management people."

EXECUTIVE DEVELOPMENT POLICIES

9

The top personnel executive of another organisation (aluminium) stated: "We follow the policy of promotion within. Only for highly specialised positions, we make direct recruitment. At the same time, we inject young highly qualified persons, engineers, accountants, chartered accountants etc. against job vacancies. We believe in tailor made individual executive development programmes and we do not believe in a general executive development programme where people fitted in. We don't believe in what late Douglas Mcgregor called the manufacturing or assembly line approach but in what he called the agricultural approach. Every manager and potential manager will have a distinct and different development plan and programme best suited for his needs, abilities, performance and aspirations." The personnel director of another organisation (tobacco) observed as follows: "We pursue a policy of self-reliance. Our policy on Indianisation of our management started as early as 1936. Our policy is to develop our executives to be self-reliant to manage their organisations independently." The managing director of the steel organisation described: "Our policy is to provide opportunities to advancement and growth to our own employees in filling higher vacancies in our company. Our policy is to see that all executives must have orientation in general management. We depute our ~xecutives to out-company programmes of a week or longer duration. We feel it is foolish to send an executive to a one day or two days programme to Delhi or Calcutta. We identify the development needs of our executives through appraisals and we earmark our executives to out-company development programmes at the beginning of every year. Our policy is also to depute our executives to reputed out-company agenCies, not to any institution." The Chairman of another of the respondent organisations described as follows: "We have a policy of promotion from within. Our policy is to recruit young and bright persons - boys and girls - at lower levels in order to inject fresh blood. Our policy of promotion is based on only merit. We use some kind of management by objectives appraisal. Our policy is to identify the development needs of our managers and to develop them both on the job and off the job. More important, we believe in developing people by assigning them to positions of responsibility. It is also our policy to encourage our manager to participate in the professional, cultural, educational, community and national activities. Our policy is to extend our facilities to outside people, particularly students and faculty. We have no formalised evaluation of executive development for this would require considerable research and a complete and proper organisation. Weare also prepared to recruit and develop more managers than necessary. We perhaps enjoy the reputation of the image of Mother of managers. To us executive development is a constant activity." The top personnel executive of another organisation (chemicals) explained: "It is our policy to spot and recruit high talent young persons and nurture them. Our policy is to give them a greater feeling of involvement and responsibility. Our policy is to recruit people with very high academic standards. We

10

EXECUTIVE DEVELOPMENT

believe in mobility among our executives from one nation to another. Our evaluation is done on a multinational basis." The top personnel executive of a textile organisation remarked that several executives in his organisation have risen from the ranks and that the policy of the company was to people with high scholastic record. "We believe in training and development at all levels. We also have a policy of promotion from within." "Our policy is to introduce modem management concepts, tools and techniques through our executive development. While we want our executives· to learn and adopt modem management techniques, we also want to nurture our cultural values and heritage." The top personnel of the same organisation maintained: "Our policy is to follow a policy of promotion from within. Our policy is to inject young fresh blood at lower levels through several schemes like the management trainee scheme, etc. We follow a policy 3:1 ratio of internal promotions to direct recruitment. The policy is to train and develop people at all levels. It is also our policy to provide all opportunities to our executives to transfer their new learning on to their jobs and thus utilise the new techniques for the benefit of both the individual and the organisation. It is also our policy to nominate our executives to executive development programmes of only certain out-company agencies. In the case of in-company executive development programmes, we always follow up with project assignments, particularly after certain technique centred programmes and the project reports are discussed at the highest levels and the feasible recommendations are implemented in the organisations." The Assistant General Manager \.If the oil organisation explained his organisation's policies: "The policy is to recruit at the lowest level and then develop them. We hire high talent young people with brilliant academic record. We believe in the policy of promotion from within. More than 2/3 of our executives started as salesmen. Our promotion is based on only merit. We don't recruit people at higher levels except in the case of highly specialised areas." Perhaps by now it is fairly evident that the executive development policies of our respondent organisations are both sketchy and incomplete, although in some 4 cases (oil, cosmetics, chemicals, tobacco) there are fairly detailed and exhaustive policies formulated by their companies abroad, but they are not available for our analysis. Some 5 organisations covered in the study (steel, 2 textiles, 2 engineering) are in the process of evolving their policies on this area and two of these are also planning an exhaustive and complete manual on executive development. However, on the basis of the replies to our questionnaire, we have to conclude that the policies are far from adequate and complete. For example, there are no definite policies on the commitment of funds and budgets, perception of training and development needs, pedagogical approaches, developmental methods, evaluation of the executive development, cost-benefit analysis,· evaluation of out-company agencies, utilisation of trained executives, executive development organisation, training and development aids and facilities, status of executive development staff.

EXECUTIVE DEVELOPMENT POLICIES

11

Summing up, save those 4 organisations, where the parent organisations have developed the policies, the other respondent organisations are yet to and in the process of developing proper policies on executive development. They still have a long way to go for the formulation of comprehensive and appropriate policies that provide guidelines for both thinking and action in the organisation. However, it must be stated that almost all of the respondent organisations have certain basic sound policies such as promotion from within, injection of fresh young high talent personnel, training and development at all levels and they are on the right track. They would considerably strengthen their executive development effort if they clarify their goals, purposes and values and come up with a clear cut comprehensive set of policies covering the areas suggested earlier. We shall suggest a set of policies later in our executive development model that may be of interest and practical utility in planning the formulation of executive development policies.

DOD

3 OBJECTIVES OF EXECUTIVE DEVELOPMENT What are the objectives of executive development? The respondent organisation, save one, have certain specific objectives which they plan to achieve through their executive development effort. The top personnel executive of the organisation (engineering) without specific objectives was frank enough to share his view: "We have been organising several in-company programmes without any proper set of objectives. There is no particular aim or sense of direction. So we are taking a hard look at our programmes and reviewing them thoroughly. I think prety soon we shall develop a set of specific aims of executive development and plan, design and administer programmes that would go to achieve our predetermined ends." The other 11 organisations have laid down specific objectives; some more thoroughly than other. The primary objectives of all our respondent organisations are: (1) to develop managers to perform better on their present assignment; (2) to prepare them for higher assignments; and (3) to provide a steady source of competent people at all levels to meet organisational needs. While this is the broad pattern of objectives, some seem to have developed objectives that are peculiar to their needs and problems. Let us turn to examine the objectives individually.

OBJECTIVES OF EXECUTIVE DEVELOPMENT

13

The chairman of one of our respondent organisations states his objectives: "Management development with us is a complex of activities whose purpose, simply stated, is to ensure three things. First, to anticipate our requirements over the next five to ten years, second, to select, recruit and train men and women to fill those requirements; third, to develop attitudes and values in individuals that prepare them to meet their responsibilities at the standards we consider desirable. All this, ultimately, like capital expenditure, budgeting, annual estimates and operational plans is the responsibilities at the standards we consider desirable. All this, ultimately, like capital expenditure, budgeting, annual estimates and operational plans is the responsibility of the Board, assisted by the active participation of all our managers and operated by the Personnel Department, which has a member on the Board." The top personnel executive of our textile oganisation described his objectives: (1) To develop existing officers considering business growth; (2) To ensure a steady inflow of young graduates with management potential; and (3) To replace elderly executives, who have risen from the ranks with highly competent and academically qualified professionals.

The top personnel executive of the aluminium company explain that it is his company's objective to develop managers according to their unique capabilities, aptitudes and aspirations; to create conditions and a climate which contribute to the growth process. The top personnel executive of the tobacco organisation explains: "Our objective is to fit a manager to take up organisational responsibility assigned to him. Second, it is to prevent obsolescence of managers. Third, it is to Indianise our management and thus provide opportunities of top management to local competent people. The managing director of the steel organisation explains that there is no formal statement of objectives of executive development. However, he observes: "One of the objectives is to provide a steady source of executive personnel within the company. The other is to help them to take care of the present job and do better. Third objective is to prepare him to accept higher assignments. Lastly, it is to help him grow fast." The tbp executive of the cement organisation enumerates the following objectives: (1) More efficient position performance;

(2) (3) (4) (5) (6) (7)

More economic methods of work; More harmonious team-work; Greater morale and job satisfaction; Quicker adaption to changing conditions; Grooming for higher positions; and Sharpening of appetite for self-development.

14

EXECUTIVE DEVELOPMENT

TIle assistant General Manager of one of our respondents (oil) responds as follows: "In an on-going organisation it is sometimes difficult to say exactly where one should start the cycle, whether from an inventory of resources or from a statement of objectives. But for the sake of clarity let me start with objectives. There is of course a continual interaction, because it is obvious that one's objectives are influenced by one's resources." "Organisational needs are twofold, immediate and future. Immediately, one is concerned with the maintenance of present activities and the organisation required for the purpose. In this area we have reviews of various types constantly in progress, appraising the capabilities of the men involved with the primary purpose of helping them to do better, assessing the workload of individuals and the subdivisions and divisions of the organisation, and the suitability of the existing organisation structure to meet current objectives. This is done as a regular part of management's responsibilities but it has to be formalised by periodic reviews and also special studies from time to time. Beyond this we have to plan for future organisational requirements to meet circumstances over which we do have control such as new investments and new products, and circumstances over which we have little or no control but cim anticipate with varying degrees of accuracy, from market growth and changing patterns of demand to political and social developments." "Having determined our organisational requirements in terms of both the immediate and the foreseeable future we take periodic inventories of the talents and abilities, and the potential capabilities of the men we have already in the company. From these inventories one can then make positive plans for recruiting training and development to meet our progressive targets." The private sector organisations covered in the study have given some thought to the vital aspect of objectives and some of them seem to have clearer perception of their goals than some others who would do well to ponder over this aspect and think through carefully and establish and state a set of objectives.

--"';

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4 TOP MANAGEMENT AND EXECUTIVE DEVELOPMENT The distinct impression that we get from our discussions with the top management and the organisational people in the private sector and also analysis of the data obtained in response to our questionnaire is that the chairmen of almost all of the respondent organisations are greatly committed to the development of human resources, particularly executive resource, to this process of growing the next generation of business leadership in their organisations. Some of the chairmen, vice-chairmen, managing directors and personnel directors (notably steel, cosmetics, textiles, chemicals, engineering, oil) have not only made a singular contribution to ti1e growth of executive leadership in their organisations but also to that of management education, development and training in the country. Not only that, we may go even further. In fact, some of these top executives have been pioneers in the introduction of management education and also greatly responsible for the management movement in the country. Notably Mr. J. R. D. Tata, Mr. Arvind Mafatlal, Sir Jehangir Gandhi, Mr. P. L. Tandon, Mr. K. T. Chandy, Dr. K. S. Basu, Mr. Bharat Ram, Mr. Charat Ram, and Mr. A. N. Haksar are some of the people who are largely responsible for ushering in professional management and promoting modern management concepts, tools and techniques in Indian industry. They have rendered invaluable service to the nation and the economic growth of the state by their commitment to management education and

EXECUTIVE DEVELOPMENT

16

development. This is indeed a big plus point in favour of the respondent organisations, for without top management commitment and involvement, no executive development effort can become effective. This is borne out by considerable body of research on executive development. In our study, this problem is highlighted in one organisation by one of the top executives: "There is not much commitment from the top management to this effort. Our top people are not quite sold on executive development and training yet. We have to sell this still and we have to periodically reinforce and revitalise their interest in developing managers. This is a problem area. If our top colleagues are sold, it will become infinitely easier for us to take the necessary actions and invest the required resources - material and financial - in developing our managers."

MANIFESTATIONS OF COMMITMENT What are the various manifestations of top management commitment and support to executive development? The current manifestations in the respondents are shown in the Table 4.1. TABLE 4.1 TOP MANAGEMENT COMMITMENT TO EXECUTIVE DEVELOPMENT

Sr. No.

Manifestation

I.

Top management participation in inauguration, valediction, etc.

2. 3. 4. 5. 6. 7. 8. 9.

Participation on the faculty in the training Participation in the committee on ED Participation in designing EDP Participation in the development of ED policies Participation in the selection of faculty and trainers Review of executive performance Identification of individual development needs Selection of executives for training and development

10.

Management and control of EDP

II.

Preparation of career development plans

12.

Evaluation of training and development

13.

Utilisation of trained personnel

14. 15.

Follow up of trained personnel General guidance and support to EDP

Number Per cent

12 10 2 9 10 8 10 10 10 10 9 9 9 9 11

100 83 7 75 83 67 83 83 83 83 75 75 75 75 92

From the Table 4.1, it must be very clear that there is considerable commitment of the top management in our respondent organisations. In addition to ceremonial participation such as inauguration and giving valedictory talk at the end of the programme, most of the top executives of the respondent organisations take substantial interest in planning, developing, administering and utilising and evaluating executive development effort, policies and programmes.

TOP MANAGEMENT AND EXECUTIVE DEVELOPMENT

17

Only in the area of participation of top management in executive development committee we find poor response mainly due to the fact that most of the respondent organisations (10 or 83%) just do not have any such executive development committee. In the 2 organisations (textiles and oil) the top executives are very active in their participation and devote a good deal of time to the activities of the committee. In another organisation (textiles) there was a Management Development Committee comprising Chief Executives and Personnel director and the Manager, Management Development functioning for a few years. The experience of the organisation was not happy with the functioning of the committee because of the delays in decisionmaking. Then the committee was discontinued. The other organisations have not thought it fit to have an executive development committee. In 2 organisations only (engineering and cement) the top management commitment manifiests itself only in ceremonial participation and nothing more and it is also their expeIience that the executive development effort in their organisations are yet to reach the much-maligned take-off stage. In 3/4 of our sample, the top management commitment and involvement manifests itself in almost all the important phases and activities of executive development. In these organisations the interest in this activity flows from the top down to all levels of line and staff management and everybody in line and staff management cooperates in creating the conducive environment necessary for nurturing of executives. There are a couple of more interesting observations. One of our respondents (rubber) observes : "All our Directors have to undergo executive development programme (EDP). Every Director on leave in U.K. attends an executive development programme at the Shell Centre." In another organisation (aluminium) there are seminars for top management where all top executives including Managing Director participate once in two months." This sort of top executive participation in training and development programmes seems to be quite in vogue in nearly 10 organisations (83%). The fact that the top executives attend a development programme has a very salutary effect on the entire organisation. Its significance, in addition to being symbolic, has a substantial impact on the other executives in the organisation. The inference from our analysis of data is that in most of the respondent organisations (10 or 83%) there is considerable top management commitment to and involvement in executive development and this manifests itself in almost all the important phases of executive development effort.

DOD

5 ORGANISATIONAL CLIMATE By organisational climate we refer to the manner of managing business which lays stress on the development and growth of people at all levels through guidance, training, counselling, delegation and communication. The growth process is largely influenced in the home environment of the company by the way superiors and peers manage, the way they treat people, how they delegate, how they advise, coach, communicate and train, how they encourage ideas, initiative and enterprise, how they provide opportunities to experiment and test new concepts, tools and techniques, how they project goals, policies and philosophy.l The success and effectiveness of executive development depends largely on the organisational climate obtaining in the private sector organisations. It is necessary to emphasise that the most critical input in the growth process is the home environment of the company and organisational climate just as in the development of a child, his home environment and the conditioning received at home are of paramount importance. It is well articulated that 90% of a person's growth takes place on the job as a consequence of his interaction with his peers, superiors and colleagues. Our interrogation in this respect was : Do you believe that there is proper organisational climate for the development of people? The general pattern of response from our sample private sector organisations is that there is a conducive organisational

ORGANISATIONAL CLIMATE

19

climate that supports and ensures the professional and personal growth of individuals. Perhaps the inspiration comes from the top and line management commitment, involvement, participation. A company in which the chief executive regards the development of its resources as one of his chief concerns will probably provide the kind of climate in which people are encouraged to grow and innovate. To support their contention, the general refrain of our respondent organisations is that anywhere 30% to 66'10 of their current crop of executives have grown within the organisation starting at the bottom of totem pole. However, two organisations are of the opinion that the organisational climate is a problem area. While there is some sort of lukewarm support to executive development it is laced with misgivings, doubts and even non-cooperation and this sort of doubt vitiates the organisational environment beca'.lse people at different levels are in the knowledge of the doubts of the top management. Even in these oranisations, there are some executives at the top attempting to bring changes in the attitudes, values and climate within the organisation. Probing further in this area, we asked whether opportunities were provided to the executive, who has just undergone training, to implement some of the knowledge, tools and techniques he had learnt, and whether this resulted in increasing productivity, cutting costs, reducing waste, increasing profits and savings. Save two, all the other organisations covered in the study give a positive response. The general opinion is that opportunities are provided to managers to transfer the learning on to the job. However quantification of the benefits accrued to the organisation is felt to be a little more difficult and complex, although one organisation is able to quantify the benefits. We shall revert to this in some detail in our chapter on evaluation and cost benefit analysis later in this volume.

EXECUTIVES IN THE SAMPLE ORGANISATIONS The strength of executive cadre personnel is indicated in the following Table 5.1 : TABLES.1 EXECUTIVES IN 12 PRIVATE SECTOR ORGANISATIONS

Organisations

Exeel/tires

1

200 1400 186 280 374 340 700 320 380 230 280 350 5034

2 3 4 5 6 7 8 9

10 11

12 Total

-

EXECUTIVE DEVELOPMENT

20

Ratio of executives to employees is shown in the Table 5.2. TABLES.2 RATIO OF EXECUTIVES TO EMPLOYEES

Organisatiolls

Ratio

1

1: 30

2

1: 25

3 4

1 :40

5

1: 375

6 7

1: 300 1: 200

8

1: 10

9 10

1 :20 1 :20

11

1 :30

12

1: 100

1: 25

In several cases the span of management seems to be quite wide, meaning that the executive population seems to be quite limited when compared to wide number of people to be managed. Due to, our limited data, we are not in position to make any further observations on this area, save by saying that there are a great many factors that influence this ratio. Genesis of Executive Development

Executive development effort started as early as 1940 in one of our respondent organisation (oil) and as late as 1970 in another (textiles) and that is the range. The following Table 5.3 shows the years the respondents got going in this activity. TABLES.3 GENESIS OF EXECUTIVE DEVELOPMENT

Sr. No.

Year of 5 tart

Number of Organisations

l.

1940

1

2. 3.

1947 1949

4.

1952

1 1 1

5.

1953

2

6.

1955

2

7.

1962

1

8.

1963

1

9.

1965

1

10.

1970

1

21

ORGANISATIONAL CLIMATE

The organisations which started earliest in the 1940s - on executive development are oil (1940), aluminium (1947), and tobacco (1949); and these three are foreign companies which had the benefit of home office policy. Thus, they are the real pioneers in the country. In the 1950s, we have steel, engineering, cement, cosmetics, and chemicals and three of them are Indian and the rest foreign companies. In the 1960s it was the turn of engineering, textiles (2), and rubber and three of them are Indian and one is foreign. It is fairly obvious by now that majority of the respondents have had a long innings in the area of developing executive talent, attitudes and skifls and in the process they have systematised and streamlined the executive development effort. Most of the executives in the respondent organisations have been exposed to management education, training and development within the company or without. Some of our respondent organisations have indeed built a certain reputation in Indian industry for their executive development capability and leadership. In the case of foreign subsidiaries, the initiative in organising executive development effort has come from the policies of the parent companies from abroad, some of whom have been the leaders in the area of executive development in USA and in UK. This has had its influence on the Indian leading companies. In the case of the steel organisation, clearly a leader and a trailblazer among the Indian companies, the chairman and the vice-chairman of the organisation invited Dr. John Marsh - formerly the Director General of British Institute of Management - in 1952 to study and to make recommendations. He highlighted the need for staff training institute and management research unit to develop the staff and to streamline systems and procedures. These recommendations were accepted and introduced in the organisation. In the case of three other organisations (engineering, cement, textiles) executive development effort had not made much headway and only from 1970 onwards, a formal and systematic effort has gotten underway. Who is in Charge? The following Table 5.4 shows who is in charge of executive development in the respondent organisations: TABLE 5.4 EXECUTIVE IN-CHARGE OF EXECUTIVE DEVELOPMENT

Sr. No.

Executive

Number of Organisations

l.

Executive Director

2

2.

Resident Director

2

3.

Personnel Director

3

4.

General Manager

1

5.

Chief Personal Adviser

1

6.

Asst. General Manager

1

7.

Chief of Personnel & Organisation Development

1

8.

Personnel and Industrial Relations Manager

1

In most of the sample organisations (10 or 83%) it is a top executive who is in charge of this activity. This certainly is a measure of the importance attached to this vital function in these organisations. This phenomenon is in complete consonance with

22

EXECUTIVE DEVELOPMENT

the global pattern where a considerable body of research and surveys reveals that in most of the suc.cessful organisations where executive development is effective, it is a top executive who is in charge of this function. One who heads the executive development effort may even determine how serious and committed the organisation is to this vital area. In other words, greater the interest of the organisation in this effort, higher is the executives in hierarchy who is in charge and vice versa. To be a little specific as to who is in charge where, here is a brief explanation. The Executive Director is in charge of executive development in rubber and textiles organisations; the Resident director in steel and engineering; the Personnel Director in textiles, cosmetics, tobacco; the General Manager (personnel) in chemicals; the Chief Personnel Adviser in cement; the Assistant General Manager (Employee Relations, External Relations & Public Relations) in oil; the Chief of Personnel and Organisation Development in engineering; the Personnel and Industrial Relations Manager in aluminium. The typical pattern in the all but one organisation is to have the top personnel executive to look after the executive development effort and he is assisted by training and development expert. But is interesting to note that none of our sample organisations has thought it fit to elevate this function to the board level requiring the appointment of an Executive Development Director. We shall revert to this later in this volume when we come to a discussion of the executive development organisation.

Executive Development Committee

The majority of the sample organisations (10 or 83%) do not seem to have thought it fit to organise a committee to look after executive development. Only two organisations (cement and oil) have such committees. In the case of one organisation (cement), the committee is known as the Training Committee whose members are Personnel Director, Chief Personnel Adviser, General Manager, General Manager (Sales), Controller of Productivity and Training Manager. In the opinion of the top personnel executive the committee helps in promoting top management commitment and involvement and planning the executive development effort. In the case of the other (oil), it is called the Executive Development Committee. The members of the committee are General Manager, two Assistant General Managers, whose functions are to lay down policies, strategies and objectives and to review executive resources and their performance and potential. This top executive committee is assisted by a Junior Executive Development Committee, membered by Assistant General Manager, Heads of Departments, Controller and Operations Manager. This committee spends considerable time and effort on reviewing performance appraisals and planning executive development effort. Generally the committee spends three days at a time on reviewing executive performance and potential. These committees have a very vital responsibility for a developing executive leadership for the organisation. This pattern is solely influenced by the home office policy, where a similar top executive development Committee has a similar responsiblity for its worldwide enterprise. In a third organisation (textiles) a Management Development committee operated for about two years and in the opinion of the Personnel Director, the committee turned out to be more a hindrance than a help to the executive development effort because of the inordinate delays in decision-making and the organisation decided to discontinue the committee.

23

ORGANISATIONAL CLIMATE

Executive Development Centre

50% of the sample organisations (6) report that they have their own executive development centres as a support system where all formal in-company executive training and development activities are organised. The Table 5.5 shows the name of the centre, the date of its start and the persons in charge of it. The earliest Staff Training Centre which started in 1947 belongs to the aluminium organisation but it is not located in this country. It is located in Switzerland by the parent company and is used by all its subsidiaries, including the one in India. The first staff Training Centre located in India in our sample organisation ~ 1951 belongs to the tobacco organisation - another foreign subsidiary. The steel organisation started the first staff Training Institute by an Indian organisation. Later the same organisation and the engineering organisation belonging to one of the top business house of Tatas in the country have a Tata Management Training Centre started in 1965. This is perhaps the best executive development centre in the country WIth excellent physical facilities. The other Staff Training Centre started in 1965 belongs to the chemical company. The cosmetics organisation has organised its own Training Centre in 1970. TABLES.S EXECUTIVE DEVELOPMENT CENTRE IN PRIVATE SECTOR

Sr. No. 1.

Name of the Centre Staff Training Centre

2.

Staff Training Centre

3.

Staff Training Institute

4.

Management Training Centre

5. 6.

Training Centre Staff Training Centre

Date of start

1947 1951 1953 1965 1970 1965

Person in charge Director Training Manager Superintendent Director Training Manager Training Manager

All these centres have residential facilities for anywhere from 20 to 45 executives. They have all the required facilities for the conduct of executive development programmes, conferences and seminars. However, one of the main problems worrying the top management of most of these organisations is the under utilisation of the centres. Some of them have had to rent out their facilities to outside groups, companies, institutes of management, management consultants etc., in order to utilise the facilities throughout the year. The other 50% of the respondent organisations do not have such facilities. Generally they hire facilities in hotels or other available premises and other training centres for their in-company activities. One of the companies (textiles) used to have a training centre but found it not worthwhile to have this facility because of under utilisation in the light of capital and operating costs. The Personnel Director of another organisation (textiles) observed: "At one time a Management Institute was under our very active consideration. But we have learnt that companies with their own centres having started find they are unable to utilise them fully. There is a move on the part of the two top business houses to share its centre with two or three other business houses so that they can share the facilities and the expenses and utilise the centre to the

24

EXECUTIVE DEVELOPMENT

maximum extent possible. We are actively pursuing this matter. At present we utilise the facilities available in the top hotels./I The idea of sharing the centre facilities is already in operation and the staff training centre is being shared by sample organisations with several other organisations with foreign connections. This idea is a sound one and if more organisations follow suit, there would be a better utilisation of such centres. Planned Management Succession System There is a planned management succession system in 3/4 of the sample organisations (9). There is a continuous review and effort at planning who is to succeed whom and prepclring them for the succession system. Even the other 3 organisations are thinking about this sort of succession system. The top personnel executive of one of these organisations shared his problem: ''There are positions, which could cause trouble if something were to happen to the incumbent. In the case of the very top positions there is some effort to find suitable successors but not many in other areas. Of course we have a general strategy to replace the older people, who have grown with the company, with more competent young professionals." So far our study has dealt with the response of top management to policy matters and they came from our personal interviews with the chairman, vice-chairman, Managing Director, General Manager, Assistant General Manager, Personnel Director, Chief Personnel Adviser of the sample organisations. Now we shall turn to more specific issues of executive development where the responses came from the Personnel Directors, General Manager, Assistant General Manager, Chief Personnel Adviser, Chief of Pesonnel and Organisation Development, Personnel and Industrial Relations Manager, Training Adviser, Manager, Management Development, Training Managers, Executive Development Officer, Management Planning Officer, Chief Personnel Officer. Management Development Co-ordinator. The responses arc concerned with all areas of executive development. But let us begin at the beginning and proceed to a discussion of executive resources planning.

REFERENCE 1.

See D. E, Balch, "The Problem of Company Climate", in H. F. Merril and Elizabeth Marting, Dcvclopll1g Execlitive Skills, American Management Association, New York, 1958, p. 66.

DOD

6 EXECUTIVE RESOURCES PLANNING The value and importance of executive resources planning is very well stressed by Mr. P.L. Tandon, former chairman of one of our sample organisations: "It takes time to make managers, especially to develop them for higher responsibilities; but we do not believe in age as a '\ietermining or even a particularly important factor; in fact it seldom enters our calculations. It is our experience that it takes about ten years to prepare a young manager to take over senior responsibility. If he has the ability and responds to development, with the opportunities that are constantly opening up in a growing and decentralised concern like ours, we would in fact be disappointed were he not able to receive his first shot of a senior independent charge in his early thirties. For all this much forward plnnning is necessary, especially where the future winners are concerned, for they have to be picked, groomed and trained for twenty years or more. And we may lose some in the process."

In the light of such a crucial value of executive resources planning, it would be interesting to find out what sort of planning for executive resources is in operation in our sample organisations. How they forecast the executive resource needs? What sort of career pImming is being attemp"ted? Do they have skills and personnel inventory?

26

EXECUTIVE DEVELOPMENT

What sort of planned succession system is followed? Systematic executive resources planning and executive succession system assists in proper selection and renders executive development very effective in meeting the organisational needs of executive resources at different levels. In the ultimate analysis the measure of the success and effectiveness of executive resources planning and development is that there are competent executives available at all levels, particularly at higher levels, when there is a need for them for any reason in the organisation. . The response to our queries is quite encouraging. Three-fourth of our respondents (9) report that they have executive resources planning and forecast their executive manpower needs, 8 for the next five years and one for the next 10 years and all of them review their forecast every year. All the 9 organisations prepare replacement inventories and 3 of them (textiles, rubber and oil) have an inventory of skills available in their organisations. These 9 respondents are textiles, rubber, tobacco, aluminium, steel, engineering, cosmetics, oil and chemicals organisations, and they have an executive succession system. Seven of these 9 organisations operate career development plans and the other 2 (cosmetics and textiles) have such plans only for high talent personnel only. Five of these organisations (tobacco, cosmetics, oil, chemicals and textiles) have five year career development plans for individuals. The other 2 (aluminium and rubber) have both short and long range career development plans. The short term plans for 5 years and long term plans for 10 years dovetailed with the 10 year business forecasts of these organisa tions. There are 3 organisations (engineering, textiles and cement) who do not do much of executive resources planing and in their judgement this is one of their weak areas. There is some annual effort at planning by the divisional and departmental and unit heads and this does not seem to be effective. However, all the three are reviewing this problem and plan to start a systematic effort in this area. Now let us take closer look at the mechanics of this planning as we shall present some case studies of executive resources planning from the data available with us from the respondents.

CASE STUDY OF ABC (COSMETICS) The Chairman of the organisation (cosmetics) explain the mechanics of the system: "The instrument of forecasting is the Management Review which is prepared every year for the next five years. It is much like the Cash Forecast. It evaluates in terms of managers the needs of our business which will arise out of expansion, new projects, new products and organisational changes. This need is then equated with our internal resources, what will be generated by way of promotions from the staff management, the losses that are likely to occur through retirements and losses through anticipated and unexpected separations. The exercise ultimately throws up our net requirement, which in a growing country and an expanding business must happily be always on the plus side. The advantages of this exercise are three. In analysing our needs we make sure that they are genuine and not Parkinsonian; and in quantifying them we know when they are likely to arise and how we will meet them. Otherwise it can

EXECUTIVE RESOURCES PLANNING

27 .

easily become a case of people retiring or new vacancies arising without their having been provided for well in advance. We begin thinking of the replacement of retiring men some years ahead of the event. Men are nominated and tried, more so for senior positions. Planned transfers and cross-postings are also a part of development, often into functions different from their original skill or training. Third and important advantage is that the promotion potential within the firm gets carefully looked at as it is first priority to promote from within, each department in stating its needs will carefully consider how it can meet them from its own resources. The Management Review is normally brought up to date every year, but sometimes circumstances may need an at hoc study. Its preparation and followup, like the Cash Flow, keep our management resources under constant study. The five year plan is reduced to an annual operating plan of recruitment and the Board is kept in touch with its progress. Every quarter a statement of the total strength of the Company is prepared showing staff in each category retirement separations, promotions and recruitment, and this is examined by each department, its director and finally by the Board."

CASE STUDY OF KLM (OIL) The Assistant General Manager of the Organisation (oil) observes: "In a going organisation it is sometimes difficult to say exactly where one should start that cycle, whether from an inventory of resources or from a statement of objectives. But for the sake of clarity let me start with objectives. There is of course a continual interaction, because it is obvious that one's objectives are influenced by one's resources. Organisational needs are two-fold, immediate and future. Immediately, one is concerned with the maintenance of present activities and the organisation required to this purpose. In this area we have reviews of various types constantly in progress, appraising capabilities of the men involved with the primary purpose of helping them to do better, assessing the workload of individuals and the sub-divisions and divisions of the organisation, and the suitability of the existing organisation structure to meet current objectives. This is done as a regular part of management's responsibilities but it has to be formalized by periodic reviews and also special studies from time to time. Beyond this, we have to plan for future organisational requirements to meet circumstances over which we do have control such as new investments and new products and circumstances over which we have little or no control but can anticipate with varying degrees of accuracy, from market growth and changing patterns of demand to political and social developments. Having determined our organisational requirements in terms of both the immediate and the foreseeable future, we take periodic inventories of the talents and abilities, and the potential capabilities of the men we have already in the company. From these inventories one can then make positive plans for recruiting, training and development to meet our progressive targets. One of the problems here is that we have to work an extended time scale and, even where future needs can be identified with reasonable accuracy, it is impossible to say without question that the raw material presently available is going to mature into the kind of senior managers whom we want to hav~ ten or

EXECUTIVE DEVELOPMENT

28

twenty years from now. Overstocking ourselves with trainees or a surplus of talent at any level is no answer. After alt even if one could ignore the employee relations problems which such a situation would cause, we still have to run our business as efficiently and economically as possible, and cold storage banks are not yet part of my philosophy, even if they were within my means. The standard approach to the development of one's future managers (and I have no quarrel with it except that it does not go far enough) has been to recruit well-qualified young men, give them training in the basic business discipline where they are needed and then over the years give them increasing responsibilities as their performance may recommend and as vacancies permit. Along with this they will be given supervisory or management training in the handling of people and once or twice may take outside courses which will expose them to the broader responsibilities of higher levels of management and the other basic functions with which they have no working familiarity. Occasionally, if the individual is particularly fortunate, he may get moved into a function very different from his expected line of advancement, this is usually because of overs tanding in one department and understaffing in another or because he has suspected talents in another field of endeavour. We decided that this approach was inadequate both for the organisation and the individual. A more detailed examination of the data obtained from our annual individual apprBisals of performance and potential in the context of our future manpower needs showed we could take much more positive steps to ensure that sufficient men would be ready at the right time to fill the positions for which they would be needed. Every year we spend a great deal of time appraising the performance and the potential of our management employees. The emphasis is the past has primarily been on performance but we are now (without reducing the amount of time given to performance reviews) giving more and more attention to potential. There are few things which are more complex than human personality and an intuitive assessment of a man (particularly when it is necessary to compare a number of individuals), is not going to be as accurate as. such an assessment can and should be. It is therefore important to analyze each individual from several points of view but particularly against a yardstick of the qualities which you are going to need. We are trying continually to improve our own guidelines.in this respect, and the latest edition of our Management Development Manual contains an extract from a talk which was given by Mr. Michael Haider, the present Chief Executive of our parent organisation, Standard Oil Company of New Jersey. In this talk he attempted by a series of questions to break the problem down into identifiable and quantifiable parts. His questions were: (1)

Does the man take a proprietary interest in the business?

(2)

How broad are his interests?

(3) Does he have sound judgement not only with respect to business mat-

ters, but also with respect to people and things outside his functional activity? (4) Does he have the ability to plan, arrange and think ahead? (5)

Does he have ability to lead people or does he drive them?

EXECUTIVE RESOURCES PLANNING

29

(6) Is he tolerant of other people's opinions? (7) Does he have constancy of purpose? (8) Does he have ambition, a desire for self-development, desire to excel? (9) Is he willing to pay the price of success? This list is by no means exhaustive and each of us may well have different • opinions upon the relative significance of the essential qualities. I don't think such differences are terribly important as long as it is remembered that the purpose of making such a list is to sharpen the process of assessment and that the people who are being assessed should be judged by the same standards. It is of course very important to maintain high standards, so that if there is any decline in the number of men identified with high potential you can start finding out why in good time by examining your selection and training processes, or perhaps even your conditions of service. We have to recognise that any sllch judgements are going to be highly subjective and therefore they must be reviewed and reassessed and tested from time to time by as many responsible people as possible. Even then I am not prepared to swear by their enduring accuracy because even if one can be reasonably correct as to a men's intellectual capacity and his basic character, it is of course impossible to foresee all the things totally outside Management's control which would happen to him as the years go by. A man's private life or his health can of course have a major effect on his ambition, his productivity and his attitude to his job. Another influence for change, let us honestly admit, can well be the men under whom he works. Therefore, as I have emphasized, continual review is absolutely essential. Industrial psychologists are now developing tools which may give us more effective guidelines as to the chances of a man being successful in management in a particular line of business but these will require many more years of study and refinement before I personally would be prepared to give them definitive weight in arriving at a decision regarding a man's potential. For present, therefore, as we consider it essential that such assessments of potential should be made, we have to depend upon experience to provide accuracy and more than one assessee to provide objectivity. This is not foolproof, of course. Some people may be overlooked, and others are going to be over rated, but as in most cases we are looking quite a few years ahead, many of these oversights or mistakes are likely to be corrected. Let us see how we go about using these data in our forward management manpower planning. First, as I have mentioned, management at all levels were asked to make reasoned judgements on the position to which each of their subordinates could rise in our organisation. These judgements were defended before and scrutinished by panels of higher management, and where an individual appeared to have extremely high potential he could be subjected to reassessment at as much as two other higher levels. Under each senior position we then listed the men who were considered to have the potential to advance into it and made the assumption that they would be available for this position in their last 10 years of service. By putting the data on a bar chart we could see graphically that certain of the positions had large gaps and others were obviously overstocked. We then again reviewed the capabilities of the men in the overstocked positions to determine which of them might have the educational

EXECUTIVE DEVELOPMENT

3U

background, the natural ability or the interests which might qualify them for any of the deficient positions. As a result of this reassessment, we were able to make a number of adjustments but there were still some obvious gaps which made it easy for us to determine what had to be given top priority in our manpower planning. What is the next step? Each of our department heads was asked to prepare a career outline showing the jobs through which a man should move to equip him best for the department head's position. In preparing such a career outline, the department head was asked to draw upon his own experience, emphasizing those jobs which did the most for him, he was also asked to include those exposures which he himself had missed but in retrospect he felt would have equipped him to do an even better job than he is doing today. Only a very few years ago, I feel that such career outlines would have included at the very most one assignment outside of the new function. This year it was rare to find less than two and they were remarkably diverse. Using the time scale inventories in conjunction with the career outlines we can determine the urgency of certain essential exposures to convert potential into ready availability and thus plan staff movements for the immediate future. This we do by making Four-Year Plans both for our key jobs and our key employees."

CASE STUDY OF OPQ (CHEMICALS) The General Manager (personnel) describes the planning process: Forecasting

Most large companies have to plan for the future growth of their business. This plan of growth is spread over 5/10 years. In order to man the growth programme, it will be necessary to forecast the requirements for the coming years. The forecasting for such manpower is extremely difficult to make and involves a certain amount of guesswork. It is all the more necessary, therefore, that we try to be as realistic as possible in forecasting our managerial requirements. It is considered that a 3-year period would be the optimum in management manpower forecasting. When we are embarking on various Five-Year Plans, it will be also in keeping with the national economic thinking to plan for a Five-Year period. The forecast for the next five years should consider the replacement of retiring managers, separation due to resignations and also accurately predict the number of managerial positions which will come up in the various new enterprises which have been planned by the company. In assessing the separation rate, it will be necessary to consider the developing tempo of economic conditions prevailing in the country and the resultant likely increased turnover rate in the managerial ranks. It is desirable that organisation charts for the future business requirements of the company should be developed preferably on a year-to-year basis. These charts will pin-point the functions and areas where high priority should be given for managerial manpower planning. The organisation charts should reflect the various levels of managers that are required, and a fair assessment of their job content and salary levels should be made. This analysis should be further broken down in terms of the requirement for various professional personnel, i.e.,

EXECUTIVE RESOURCES PLANNING

31

the number of chemical, civil, industrial, mechanical and electrical engineers, accountants and business management graduates etc. When we have the complete analysis as outlined above, it will be possible to assess accurately the future managerial manpower requirements. Available Resources

Once the company has analysed its future requirements, the next step is to look at its own internal resources. An inventory should be made of all the available managerial personnel potential-wise and classify them by names, jobs, responsibility levels. At the same time, an evaluation should be made of the internal resources with respect to any trainees which the company might have employed and who are available for various future managerial positions. This analysis will reveal the number of engineers, accountants, business graduates, etc., that the company has in its employment. This determination of available resources will, be required for the future years, based on the forecast. It is suggested that at this stage a summary should be prepared in accordance with the form given. The summary will show the total requirements of technical and managerial personnel by responsibility levels, and the year in which these requirements will arise. At the same time, the existing resources available with the company will be summarised in the same form. It will, therefore, be possible to determine the estimated surplus/deficit, in the managerial groups at different levels of responsibility during the next five years. Another form is attached on which should be summarised the technical/managerial requirements during the next five years, broken down in terms of the basic professional qualifications, i.e., chemical, mechanical, electrical, civil, or industrial engineering, accountancy, business and sales management, etc. In the same form there should be an inventory of the company's own resources for each of these professions based on the present availability in the organisation. The data will show the estimated future requirement of such professional personnel, thereby highlighting the areas in which more stress may have to be placed for recruitment, training and development. The analysis will reflect the deficit/ surplus in the various professional groups in the next five years. The advantage of such an analysis is that it is possible to quantify the requirements and the company is thus in a position to know when these requirements are likely to arise. The Logical Step

Once all the above facts are determined the next step will be to find out how to meet these projected requirements. It is, therefore, possible to have: A planned recruitment programme well ahead of the data when the requirements are likely to arise. A planned job-rotation programme for existing persOlmel to fit them into higher positions, which are likely to be vacated due to promotions, transfers, reorganisation or retirements. It should be noted any forecast made for a period of five years must be re-checked every year in terms of the changes that might have taken place in the operational plans and growth programmes. As a result, forecasting and determination of available resources becomes an annual exercise for the succeeding five years. In fact, such a

EXECUTIVE DEVELOPMENT

32

review should be made an essential part of the total future planning of any enlightened growth-oriented business.

CASE STUDY OF XYZ (STEEL) Intake of the Right Type and Need to Inject Fresh Blood

"Promotion from within" does not mean promoting automatically unsuitable men simply because they are within the organisation. For the complexities of business today, a sound educational background is necessary for moving to managerial levels. The potential managers rising from amongst those who did not have the benefit of university education are already scarce and they will be fewer as years pass by. There is, therefore, a need to bring in new blood at least at one intermediate level. These must be people with educational attainments and personal qualities. The level at which they are introduced is extremely important. It should be such that there will be a need for them to work hard, learn and show results before they can move to positions of responsibility. Working through the company gives them a chance to get acquainted with the company's operations and make themselves acceptable to the people around them to the exclusion of others within the organisation who have been shaping well and have exhibited a great potential, it can cause resentment and loss of morale. In every organisation there are people who have shown extraordinary ability although they did not or could not go for higher education. Such men of promise, however few, must receive encouragement and opportunity to develop themselves and compete with the recruits who have had a more advance education. It is, therefore, important that in planning for management potential, this aspect is not ignored when a decision is taken for the recruitment of the right type of men. Forecast of Requirements

The total managerial potential of a firm must be continuously reviewed as-a deliberate responsibility of the highest line executive. It is necessary to consider what suitable people are available in the organisation and how they are likely to move in the next five or seven years. The picture does not remain stagnant. Hence the need for a continuous review. Some of these questions will help to size up the situation: What potential material is available within the company? How does it affect the new intake? Is it a specialised field or are suitable people readily available? What are the company's plans for the future? How many, at what levels and by what time will be needed taking into account the effect of retirement and delay in training? What is the turnover of managers today and what is it likely to be in future? How can the available material be moved in order to get the best of their abilities for the firm, at the same time giving them opportunities for advancement? Are there any bad patches or is a vacuum likely to arise for want of a suitable person for promotion to an expected vacancy? What advance action can

EXECUTIVE RESOURCES PLANNING

33

be taken? Is there suitable material elsewhere in the organisation which may be moved in time to such places? Does the talent spotting programme need revitalising? Are there any pockets where good men cease to grow because of nature of work or kind of boss? Is anyone blocked by mere accident of placement? Is good potential material concentrated at some places and science at others? Will transfers help? Spotting Talent

For building up for the future, every company has to be on the look-out for men who are above the average and have the makings of a manager. The time is past when we could be content with few outstanding individuals who would in any case select themselves. The numbers of managers needed today is much greater, and a deliberate programme of spotting talent is necessary to ensure that suitable people are not overlooked. In the absence of such a programme, ambitious men try to catch the attention of top executives. This can be demoralising to the quieter people who are good or even better for shouldering managerial responsibilities but prefer to concentrate and excel in their jobs while the other type are busily engaged in their own "public relations" work. The quiet type cannot be blamed if they start wondering whether merit really counts in the company. Whatever may be said in favour of social skills, managers are ultimately valued for what they can accomplish on the job. Talent spotting must, therefore, be a specific responsibility of senior management. A specialised procedure is useful but not always necessary. Experienced executives, free from prejudice, judging independently an individual whom they have seen in various work situations as well as off the job, have a reasonable chance of making a correct assessment. In spite of aU claims by specialists, this will remain a practical way of judging people for quite some time to come. Character, analytical ability, thinking in depth, willingness to take responsibility, initiative, capacity to learn and apply, and getting along with people but not necessarily conforming too much to the group are qualities which must come to the surface over a period of time in work situations and help in assessing the individuals. Whether the assessment is done by an elaborate questionnaire or interview by a psychologist, is not as important as what use is made of the results, and whether the people who are affected, feel that there has been a sincere attempt to make a fair selection. This organisation has a 5 year executive resources plan and reviewed every year. Retirements, turnover, expansions are taken into consideration for planning. Assistant to positions are created as a prelude to the succession.

CASE STUDY OF MNR (TEXTILES) What is Manpower Planning?

Manpower planning may be defined as a strategy for the acquisition, utilisation, improvement and preservation of an enterprise's human resources. Objectives of Manpower Planning

The objectives of manpower planning are mainly: (1) to ensure optimum use of human resources currently employed;

EXECUTIVE DEVELOPMENT

34

(2) (3)

to assess or forecast future skills requirements if the organisation's overall objectives are to be achieved; and to provide control measures to ensure that necessary resources are available as and when required.

A number of more specific reasons for attaching importance to manpower planning and forecasting exercises are: (1) (2) (3) (4)

(5) (6) (7)

to determine recruitment level; to anticipate redundancies and avoid unnecessary dismissals; to determine optimum training levels; to provide a basis for management development programmes; to cast the manpower in new projects; to assist productivity bargaining; and to assess future accommodation requirements.

What are the types and levels of skill for which forecast should be prepared? One of the main purposes of manpower planning is to enable the company to identify "trouble spots." Since the effort of preparing forecasts can be considerable, it is dearly desirable to concentrate as far as possible on critical skills on occupational groups, i.e., those where shortages are most likely to upset the company's programme, where recruitment is more difficult, where the period of training is longest, or where skill costs have been rising steeply. Considering these, we suggest that unit manpower planning should involve from first level supervisors to Junior Assistant level and the Central Personnel Department from Senior Assistant upwards. Are Forecasts to be Prepared for the Whole Unit or by Department?

We suggest to prepare plan by departments like Spinning, Weaving, BD.P., Engineering, Manager's Office. What is to be Length of Forecasting Period?

In many companies, five year period is felt to be as far ahead as it is possible to make a reasonable estimate of economic, social and technological developments; but this may be too ambitious for some organisation and toO' short for those who are accustomed to long term planning of large-scale capital plant like our chemical units. Five years will, however, give most units the "lead time" they will require to take remedial action where manpower is concerned. The best practice is to draw up forecasts for the first two years in detail; then each of the subsequent years and have a procedure for annual, or even half-yearly revisions. A useful technique is to roll on the forecast by a year at each annual revision, thereby keeping the length of the forecasting period unchanged whilst making any amendment necessary in the light of changing circumstances. How to Compute Manpower Forecasting?

To compute manpower planning for a particular period, we should know the (i) demand of different skills in that forecast period, and (ii) how to supply these skills.

35

EXECUTIVE RESOURCES PLANNING

Demand

Broadly speaking, four main approaches to medium and long term manpower forecasting can be distinguished at the level of the unit. The first of these relies on the informal opinion of managers within the company. The second is based on the idea of projecting past trends in employment by statistical techniques like extrapolation, regression and co-relation etc. In the third, the results of work study /job description etc., exercises from the basis for forecasts; and lastly and in many circumstances the most difficult to apply, predictions are based on measures of productivity. Although in practice these approaches are treated as alternatives, we should use all these to supplement each other whenever we have the sufficient data to do. In tabular form it will be as follows: Total

1972 1973 1974 1975 1976 (1972-76) l. No. required at the beginning of year (present + va can t positions).

2. Additional requirement due to expansion at therate of % per year. 3. Total requirement at the end of the year. (Item No.1 plus Item No.2).

For our units, to begin with, we can: (1) estimate the manpower implication of one or more alternative assumptions about the rate of company growth etc. (expansion rate C.P.D. has assumed . is 4% per year). (2) monitor, at regular intervals (half yearly done by C.PD.), the effects of change in order to be in a position to revise forecasts without delay where this becomes necessary. Supply

We should make analysis here for forecasting for replacement of losses through wastage. Broadly speaking, the wastage elements are: (a) Normal Retirement: Normal retirement is a natural wastage which depends on the company policy. Our company policy is 0 for normal retirement. This can be estimated for the forecast period through personnel records and through an analysis of the age distribution of employees. If the company encourages employees to stay on after reaching retirement age, some estimate will be necessary of the numbers doing so, or it may be preferred to regard this as an extra margin of error in case other types of wastage prove higher than anticipated. (b) Natural Wastage: Natural wastage can be defined on losses of staff due to death, illness of disability. This can r,e computed through the past experience and the age structure and general health of the employees.

EXECUTIVE DEVELOPMENT

36

(c) Discharges: Some units may wish to take into account the loss of personnel as a result of discharge or dismissals. Again, previous experience should provide the guideline. (d) "Voluntary" Wastage: In majority of the units, the largest single constituent in the wastage rate is loss of personnel through "voluntary wastage" or resignations. It is clear that wastage for reasons such as conditions of work, morale, job satisfaction, opportunities in the unit and elsewhere will vary widely from unit to unit and between industries. Here, again, the past experience and future trends in the industry will provide the guideline. (e) Transfer and Promotions: An allowance which must be allowed when arriving at an overall estimate of wastage, will be the extent to which particular occupational and hierarchy group is lost to other occupations as a result of lateral transfer or to higher hierarchy group as a result of promotion. Given careful analysis like succession systems analysis, transfer analysis etc., it will be very easy to predict the proportion of employees in particular categories who are likely to be promoted or transferred between departments in the future. In tabular form, it will be as follows: 1972 1973 1974 1975 1976 l.

No. available at beginning of the year

2.

Losses through wastage

Total (1972-76)

(a) Actual retirement at the age of 60 years (b) Early retirement (% per year) (c) Discharges (% per year) (d) Voluntary resignations (% per year) (e) Transfers and Promotions (% per year) Total 3.

Total available at the end of the year (Item No.1 minus Item No.2).

Reconciling Supply and Demand Forecasts

The stages already discussed in Demand and Supply columns are intended to provide the management the extent and nature of shortages or surpluses of manpower, given certain business objectives. The following table provides a simplified picture of the way in which the size of the manpower gap can be calculated and a recruitment and control schedule for the succeeding five years derived. This Table gives a hypothetical case and is not related to any of our units.

37

EXECUTIVE RESOURCES PLANNING COMPANY SPINNING DEPARTMENT (DEPARTMENT ASSISTANTS)t

1972 1973 1974 1975 1976 100

108

112

(a) Actual retirement at 60 years

2

3

7

1

3

16

(b) Early retirement (1 %)

1

1

1

1

5 5

I. Number available at beginning of the year (1st January) Supply

-

(c) Discharges (1 %)

1

1

1 1·

1

1

(d) Voluntary resignations (5%)

5

5

5

5

5

25

(e) Promotions and Transfers

7

4

4

2

3

20

84

94

94

-

-

4. Vacant Position

4

5. Expansion (4% per annum)

4

6. Total Required (Item No.1 + Item No.4 + Item No.5) Additional number required during the year Item No.6 - Item No.3

*

116 120

2. Losses through wastage:

3. Total (Items No.1 minus Item No.2) Demand

Total 09-2-76)

108 24

4

4

112 116 18

106 107

22

4

-

4

4

120 124 14

17

20 -

95 •

EXPLANA nON: Item No.2 (a)

In 1972, Mr. Y. (5-6-1912), Blow-rom Section and Mr. Z (5-11-1912), Carding Section are due to retire. Likewise in other years)

Item No.2 (b)

One vacancy due to early retirement each year.

Item No.2 (c)

One vacancy due to allowance for discharge each year.

Item No.2 (d)

The vacancies arising out of voluntary resignations (turnover) are estimated to be 5 each year.

Item No.2 (e)

In 1972, 7 vacancies are due to promotions and transfers. In 1773, 4 vacancies are due to promotions are transfers. (Likewise in other years).

Item No.3

Total number available after losses due to wastage is estimated by deducting Item No.2 from Item No.I.

Item No.4

4 positions are vacant. (To specify particular positions vacant).

ItemNo.s

Vacancies due to expansion are estimated to be 4 each year.

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38

Requirement and Supply Profile

Year

SuppLy Plan

Total Requirements Internal

External

1972 1973 1974 1975

24 16 22 14

19 13 18

5 3 4

11

3

1976

17 93

14 75

3 18

Total

Recommended Recruitment Schedule

Please write recommendations of yours for 5 years.

CASE STUDY OF DEF (RUBBER) This organisation has a ten year plan reviewed annually. There is a management inventory and succession system. Generally the policy is to identify two possible successors - (1) immediate and (2) long term. Firstly, there is an inventory of the incumbent, his position, his age, date appointed, date due for replacement, next appointment to which present holder could be promoted and whether ready for promotion and if not what further training or experience is required. Secondly, the company tries to identify one immediate and one long term successor, successor's present position, what further training or experience is required to fit him for a promotion and the likely time when he is ready for promotion. There is a continuous effort at planning, spotting potentials for higher assignments and providing them with necessary training and development or experience in order to prepare them for higher assignments. Executive resources planning, career development plans and management succession systems are the key phases of any executive development system and without which you just do not have effective executive development in the systems sense. A majority of the sample organisations do plan their executive sources and their development. Next let us turn to how executives are recruited, selected and inducted by the sample organisations.

DOD

7 EXECUTIVE RECRUITMENT, SELECTION AND INDUCTION What is the recruitment and selection policy in the sample organisations? It is interesting to note that the typical pattern is not to hire any executives at higher levels; to fill higher vacancies through internal promotions; to recruit from outside in case of highly specialised areas, which cannot be met from within the organisation; to recruit high talent young graduate through same sort of trainee schemes; to groom the trainees for higher responsibilities over a period of time; to recruit high talent graduate with executive potential at the lowest level. This is the pattern in most of the sample organisation (10 or the 83%). In one of the sample organisations (oil), there is not much of recruitment at all largely because of the organisation scaling down its business operations. In another (textiles), the policy is to recruit bright young college graduates to replace the older generation of executives who have risen from the ranks. Now let us tum to take a closer look at the recruitment and selection of the respondent organisations. In the case of our first respondent (engineering), the policy is first to not to recruit executives at all, except when they have to and thai: is in case of highly specialised personnel. Secondly, the policy is to recruit at the lowest levels. Thirdly, it is to recruit bright young graduates (mostly from the IITs and VJTI) through a college recruitment programme. Fourthly, all vacancies are advertised both within the organisation and

40

EXECUTIVE DEVELOPMENT

outside in the national newspapers. Fifthly, there is a rigorous selection procedure with a series of interviews and tests and selection committees. The policy in another of our respondents (textiles) is to gradually to replace the older generation of executives who have risen from the ranks with bright young college graduates. The policy is to recruit the top 10% of the class through college recruiting. There is a good selection procedure starting with applications, tests and interviews. Another policy is to advertise all vacancies within the organisation and any employee with required qualifications can apply and it is not necessary for him to go through his head of the department. Generally such employees are called for the final interview. The point of entry to the fresh graduates is through the technical graduate scheme, commercial graduate scheme, management trainee scheme, graduate engineering trainee scheme, another policy is to advertise all vacancies in national newspapers and subject the applicants to the selection procedure. The Chairman of another organisation (cosmetics) explains the policy and procedure: "From where do we get our mangers? First, always, we look within. Who is ready to be made a manager and who is ready to move up? The process of following initial selection of staff with a good original record, observation, training and grooming should ensure a regular flow from within and a ladder for the men and women with the right qualities to climb to the higher levels. Secondly, we recruit young trainees, fresh from the universities with good degrees in humanities or sciences for the general side, in engineering and technology for production, qualified accountants for finance and audit. Experience may help but we primarily look for a good mind and a likely ability to possess and develop the set of attitudes that we consider important for our business. These may be called "management -like qualities"; not easy to define but meaningful when they are there, and the cause of management failure when they are missing. We resort to direct recruitment when it is necessary. In actual practice this is mostly confined to specialists as in our agricultural operations, animal feed-stuffs, research, economics, stastics, engineering, medical and legal fields where we do not have specialist resources within the Company. But sometimes even in non-specialist jobs if we have not got a suitable qualified person, rather than lower the standard we will go outside." The top personnel executive of another organisation (rubber) reports: "Our motto is : "Today's chargehand is tomorrow's manager." So we follow a policy of promotion from within. We always try to fill higher vacancies through our own people. Bring in a Divisional Manager and you will upset half a dozen people. We don't want that to happen. Only when it is impossible to fill a vacancy through internal promotion, we resort to direct recruitment. At middle and senior management levels, our recruitment is restricted only to highly specialised functions. Our policy is to inject fresh blood at the lowest levels through management trainee schemes. All selections are based on a procedure which includes a series of tests and interviews.

EXECUTIVE RECRU1TMENT, SELECTION AND INDUCTION

41

The personnel Director of another organisation (tobacco) explains his organisation policy and system: "We have 5 year plans forecasting our manpower requirements done by the departments. Our policy is to follow promotion from within as far as possible. Direct recruitment is rare and only in case of specialists. We have fop management, senior management, intermediate management, junior management, management pupils, management trainees and our own recruitment is never at the top and senior man 2

Level

Production planning and control

3 2

New Officers & Executives Officers Officers Officers

5.

Orientation programme on EDP

2

Officers

6. 7.

Marketing management Appreciation course on materials management Cost analysis and reduction for fabrication shop Cost analysis and reduction for machine shop Cost analysis and reduction for inspection and service department

5 2

Officers Officers

1

Officers & Executives

1

Officers & Executives

1

Officers & Executives

II.

Finance for non-financial executives

2

Executives

12. 13. 14.

Effectivecommunication New prospectives in industrial relations

3 2

Managerial perspectives (Phase I) Managerial perspectives (Phase II) Human relations laboratory

5

Officers Executives Officers & Executives

5 5 4

Officers & Executives Executives Officers

8.

9. 10.

15. 16. 17.

Financial management

2

EXECUTIVE DEVELOPMENT

112

18.

Performance appraisal

19.

Performance appraisal Seminar on capital budgeting Operations research Sales refresher course Team development programme Management information system

20. 2l. 22. 23. 24.

1 2 2

5 1 5 2

Deputy Gen. Managers & Gen. Managers Dept. Heads Executives Officers Sales Personnel Officers & Executives Executives

Some of the above programmes are repeated anywhere from twice to four times. Most of the development programmes are need-based and hence, their utility is enhanced, the company reports. We feel that the duration of a majority of the programmes seems to be too short to make a definite impact on the participants, since they are one or two day programmes. It is obvious that there is a combination of orientation, functional, technique-centred, general management, skills oriented programmes based on the needs of different officers only and executives. Another pattern is that some of the programmes, which are designed for executives only, some for officers only and some for both and it is clear that there is a definite strategy of gearing programmes to the needs of different levels of the executive cadre. There is considerable emphasis on cost analysis and reduction, team development, industrial relations, human relations, induction and orientation, performance appraisal, Financial Management, production planning and control, Monthly meeting of Graduate Engineer Trainees and Post Graduate Trainees, and it is quite obvious that there is a pretty good balance in the design and strategy of executive development. There is definitely a sound strategy to cover as many areas of management and as many levels as possible. A very interesting and worthwhile practice is that this company organises a 2 day induction programme in the first week of every month through the year for the new entrants and this is a clear indication of the great value and importance that the organisation attaches to inducting the newcomers in to the company. This is certainly worth emulation not only for our sample organisations but also all the other organisations in the country, for we concur with this engineering company, that proper induction is most essential to get the new employee off the ground in the right manner. A wrong or an indifferent invitation of a new employee can kill all his enthusiasm and zest and starting on the wrong foot and wrong impression may result eventually in the loss of the newcomer to the company! Another interesting programme of this company is the monthly meeting of graduate engineer trainees and post graduate trainees, which would help review the learning and performance of the trainees on a systematic basis. However, in this otherwise well balanced in-company executive development effort, one misses the programmes on some areas such as systematic plant maintenance (particularly in an engineering concern), production management, inventory management, etc. Perhaps these may be organised later on. Nevertheless, we must say there is a pretty good balance in the in-company executive development programmes mix. The company reports that recently it has started a new series of organisation development effort. We should like to quote from the company note the progress, prospects and problems of its OD effort.

STRATEGY OF EXECUTIVE DEVELOPMENT

113

1.00 EFFORT "Introduction

Organisation Development aims at improving the effectiveness of organisations through systematic efforts aimed at developing its capabilities for problemsolving and decision-making. In the process, 00 builds a capacity into the organisation to constantly examine itself for continuous effectiveness. 00 derives its ideas, methods and strategies from the knowledge of various social sciences including Organisational Theory. In the United States of America, where 00 has its 'origin' it has been adopted by a number of organisations as a method of improving their efffectiveness. In India an increasing number of organisations have shown interest in 00. One could say there is enthusiasm to join the 00 'bandwagon', so to speak. Considering that professional expertise in this area is as yet a scarce resource and unavailable to most organisations, one wonders if 00 programmes will not deteriorate into gimmickry and dilettantism and lead to scepticism later. Among the organisations where organisation development is believed to be attempted, the industrial group of Kamanis, the Tata Iron & Steel at Jamshedpur, the Hindustan Machine Tools at Bangalore and the State Bank of India are worth mentioning. We are yet to know, however, the experiences of many of these organisations in their use of 00 and its actual impact. We have some appreciation of the 00 efforts in the Kamanis from the presentation of Prof. Nitish De at the Annual Convention of the Indian Society for Training and Development in 1971. We believe that as more experiences are shared, there should develop a body of literature on the practice of 00 in Indian Organisations which would be of considerable use to practitioners in 00. Towards this end, we thought we would share our work in 00 in our company where we have made a modest beginning. The company is a leading industrial organisation manufacturing a variety of products and equipment to meet industrial needs including some which are highly sophisticated. The 'Organisation Group' includes a number of subsidiary and associate companies set up in collaboration with reputed foreign firms. The total strength of employees in the group is around 6,000. \ The first project in 00 was initiated in organisation only in July 1971. Earlier in 1969 the Personnel set-up in the Company had been reorganised to include the Training and Organisation Development functions. It was only after thus 'legitimizing' the role of the Personnel & Organisation Department (as the department came to be re-designated) to include 00, that" we could consider undertaking systematic 00 effort in the organisation. With approval of the management, the appointment of an 00 Analyst was made, to work full time in assisting the Personnel & Organisation Manager in 00. With this additional resource, we had thus a three-man team to initiate, assist and monitor 00 efforts in the organisation. In the following pages we have described six projects in 00. These projects have clearly distinguishable features in terms of their methodology and process, although not perhaps in terms of ultimate objectives.

EXECUTIVE DEVELOPMENT

114

Projects A, B & C are attempts at team-building in three companies as the first phase in a continuing strategy of organisational set-up. These projects have involved the use of the laboratory method to introduce and facilitate OD efforts. Projects 0 & E are efforts towards 'improvement' in sepcific organisational areas, e.g., project D is a study to clarify the roles of a certain group of managers in the total organisational set-up. These projects have involved the extensive use of the interview and discussion method. In Project F, which is yet to be initiated, we have engaged the services of an external 00 consultant, who would work with the managers of the Company in initiating and carrying through OD efforts. Our involvement in this project not be that of an 'intermediary' but of resource people who would be available for consultation should the external consultant require it. Even this role would be limited in view of the fact that the Company is situated in a distant location. A significant feature of the above OD efforts (except Project F) in organisation is that they have been planned and initiated internally without reliance on an outside consultant. This we felt could be done because of the experiences and background of some of the staff in the Personnel & Organisation Department of the Company. In undertaking 00, we were conscious of our possible strengths and handicaps as 'internal' helpers. Such a role cannot be assumed but has to derive from the 'felt' needs and perceptions of the managers involved in OD effort. We would, however, agree with Prof. Walton about the need for developing internal consultant resources. As the organisation development effort gets 'under way' the availability of internal staff for consultation becomes important and we believe that in view of their knowledge of the organisation they could be effective facilitators of 00. In any case, larger organisation in our view would need to develop internal specilists in 00 even if an outside consultant was employed to constantly monitor the efforts and be available as 'resource' men for the managers and management of the organisation.. This is a preliminary note and does not document all our experiences during the past one year or so, that 00 has been 'in operation' in the organisation. We hope to publish more comprehensive and detailed accounts in due course. In this note we have merely attempted to give an idea of some of the key concepts and ideas underlying our approach to 00 in organisation, and in the process throw up some issues for examination. 1. The First Phase: 00 Laboratories for Managers

Organisational Development efforts in organisation were initiated in 1969 and 1970, when a series of Training Laboratories of one week duration were conducted for Managerial and Senior Supervisory personnel of the Company. The objectives of the Laboratories were to: Increase awareness and appreciation of the interpersonal and group relationships in the organisation and their implications of organisational performance and productivity; (b) Help develop skills needed for becoming more effective in interpersonal relations as well as functioning more effectively as a member/leader of a group; and (a)

STRATEGY OF EXECUTIVE DEVELOPMENT

115

(c) Provide a framework with which the work-culture and practices within

organisation could be analysed and understood. These objectives were sought to be accomplished mainly through structured individual and group experience in exercises/activities simulating organisational situations. For example, in Exercise (Objectives) the participants were required to choose one of the two alternatives offered to them on five problems facing a Company. For example, should the Company spend on reducing water pollution even if it can avoid such a step indefinitely? The decisions were to be first individual and then in a group, through consensus. As the decision on the problems involved 'values', the exercise was used to illustrate the relationship between managerial values and organisational decisions. Similarly, an exercise called the NASA game, was used to illustrate the process of decision-making in groups and their consequence for the quality and speed of decisions. Thus, the laboratory provided for experience of and exposure to a range of behavioural and organisational phenomena (simulated) to the participants. However, as the objective was not merely to enhance understanding of organisations but also to develop personal skills, the laboratory method emphasized the learnings of the participants through team-work, discussions and observations of group processes. The trainer's role thus chiefly consisted of providing observation of the members as participant-observers in groups. The participants in the laboratories were from different parts of the organisation with a wide variety of responsibilities in production, sales, design, etc. Only a few of them had direct or close work-relationships with each other. They could thus be called 'cousin' groups. 1.1 Follow-up Study on 'Outcomes' of the Laboratories

A follow-up study on the 'outcomes' of the laboratories carried out later (in April 1971) brought out that while the participants from the laboratories felt that they had definitely 'benefited' from the programmes, the objectives of the laboratories were not clearly understood by them. Also, changes in the behaviour of participants subsequent to the laboratories were not noticed by their colleagues and superiors. Despite these shortcomings we feel that the laboratories contributed to an increased awareness of the 'human' factors in organisation and, in some measure, to the receptivitiy to the 00 prorammes that have been undertaken in the organisation. 2. OD Programmes in Organisation

Systematic 00 effort was considered when, as a consequence of the laboratories, specific units of the Organisation, including some Subsidiary/Associate Companies expressed interest in starting 00 work and requested our assitance for the purpose. 2. 1 Criteria for Selection of Unit for 00 The following considerations influenced our selection of a unit for OD .. We believe they would have significant implications for the success of the 00 effort.

116

EXECUTIVE DEVELOPMENT

(a) Autonomy of the organisation: It is important that an OD Programme should result in actions to improve'upon the present state of the organisation. This is not possible if the factors determining the effectiveness of the organisation are beyond the control of the managers of that organisation. As an OD effort becomes an organisation-wide activity, actions could be taken which affect the different parts as well as the organisation effectiveness as a whole. However, if OD is undertaken in a part of an organisation, the unit concerned needs to be autonomous enough to undertake and carry through systematic efforts for improvement. Otherwise frustration will result with unfavourable consequences for the OD effort. (b) Support of Key Executive(s): The understanding of the basic premises of OD, and commitment to it, on the part of the principal executive and other key personnel will undoubtedly act as a 'spur' to OD efforts. This is an essential condition (although not a sufficient one) in the long-run for success of OD. Even if such an ideal condition does not exist at the beginning of an OD programme, it is desirable that there should be receptivity to OD on the part of some key personnel including the principal executive. Are they willing to give OD a genuine try to supporting a systematic change programme? (c) Probability of accomplishment of tangible results: The rationale for the first two criteria were based on the need for ensuring that Significant organisational issues/tasks can be tackled with the involvement and support of the key executives. The third' criterion', viz., the possibility of accomplishment of some 'tangible' results through OD effort in a relatively short time, was decided upon for tactical reasons. Considerations of strategy in OD do require that the 'preliminary' commitment of management in the early stages needs to be transformed into a sustained involvement. It seems reasonable to assume that some 'output' through OD efforts in the early developmental stage should have a significant effect on accelerating such a process. This is especially true when the OD concept is not appreciated in all its dimensions, and one is confronted with a situation where an organisation is willing to start OD, 'instinctively' seeing possibilities in it, yet not completely clear as to the process involved in systematic development effort. Such a situation is not 'ideal' for OD effort but is certainly positive and permits a start-up decision on OD. The major handicap in such an effot is that it may not have the 'active' support and involvement of the key executive/s with consequence for other personnel's perception of and commitment to the OD Programme. All the same it seems to us that an organisational activity like OD needs to be perceived contributing to improvement of organisational performance for it to elicit the complete support (in terms of commitment of time and resources) of the top management. OD as much as any other new emerging function, must seem to have 'Productive' possibilities to win over 'hardnosed' line executives. This is not to say that an OD programme will succeed irrespective of the initial support of key executives. What we are emphasizing is a pragmatic approach which does not insist on the commitment of the top management (in terms of ongoing active responsibility for OD effort in the organisation) as a pre-condition for starting OD efforts. Provided that the top management is not hostile to the approach, it should be possible to secure its commitment through 'successes' achieved in OD in the early stages.

STRATEGY OF EXECUTIVE DEVELOPMENT

117

3. 00 Project-Selection of a Unit for 00 Effort Keeping in view the above considerations we chose to undertake 00 effort, in one of the Production Units of organisation (hereafter called Project A) :

The Production Manager of the Unit was concerned with problems of 'communication' in his department (as he put it) and hoped that a laboratory for his supervisory personnel would help in solving them. The Production Manager's interest in 00 could be attributed in part of his positive experience of a 'Sensitivity' Training Laboratory conducted by an Institute of Management he had attended a year-and-half earlier to the 00 programmes. (b) Some of the studies/projects conducted in this unit of the Company internally and by outside researches highlighted certain organisational issues. For example, in an Employee Opinion Survey carried out within the Company we found that relationships between senior supervisors and managers was not entirely satisfactory and could improve considerably. Similarly, in a study conducted by a doctoral student on first-line supervisor in the Company, a number of issues relating to the effectiveness of their roles were highlighted. A third study carried out by a professor of an Institute of Management pointed up the leadership styles and practices in a part of the organisation and their effect on the morale of the junior staff. (c) Exploratory interviews of the Personnel & Organisation Manager with the Production Manager and some of the other key Managers brought into focus problems of inter-departmental co-ordination as well as interpersonal relationships. These managers hoped that some efforts could be made to resolve these issues. (d) A number of managers and senior supervisory personnel from the unit had attended the Organisational Development Laboratories mentioned earlier. In project A, therefore, we had a situation which seemed favourable for 00 effort. The Production Manager's interest, the 'felt' need for tackling certain 'problem' areas, the exposure of some of the managers to behavioural science concepts, were felt by us to be positive factors, and influenced our decision to undertake 00 in the Unit. For initiating 00, we decided upon a section of the Production Department (referred to here as Shop 'A') as an appropriate 'entry' point. The manager of this section felt the need for initiating a systematic effort to overcome some of the problems in the section which hampered its effectiveness and was willing to support an 00 programme for this purpose. The section was a key manufacturing section and any improvement in its operating efficiency was bound to have its effect on the overall efficiency of the production organisation. (a)

3. 1 OD Laboratory The method we decided to use to introduce 00, in discussion with the Production Manager and the head of the Section, was a 'structured' laboratory of six afternoons for the cross-section of the supervisory personnel in the Section. The broad objective of the laboratory was team-building through task accomplishment. To this end, the design of the laboratory provided for group experience in problem-solving and decision-making on lines similar to the laboratories described earlier. An important feature of this laboratory, however,

118

EXECUTIVE DEVELOPMENT

was group activities in which the participants were to identify the problems/issues confronting them in their work situation, prioritize these, and analyse some of them. The programme's main focus was on group work. Intra-personal and inter-personal processes were not emphasized. 3.2 Explanation of Programme Objectives The 00 programme objectives were explained at length to the participants by the Personnel & Organisation Manager in a meeting a few days earlier to the programme. The explanations sought to distinguish the 00 effort from the normal training programmes. It was also emphasized to the participants that the laboratory focus was not merely on "human relations" but also on more effective working of the Section. Beyond giving a broad explanation of the laboratory objectives and their relevance to organisational effectiveness and answering the questions put by the participants, we did not elaborate on the detailed design of the laboratories at this stage as we felt this was not necessary and might tend to confuse them. It seemed to us then and our experience has since confirmed it, that a few hours spent well in advance of 00 programme in getting across the basic ideas/purposes of the programme to those who would be involved in it, is time well invested and serves to gauge initial reactions to what is admittedly an innovation in management methods. Misunderstanding about the objectivs of the laboratories may lead to a lack of involvement in the programme. 3.3 Trainer's Role during the Laboratory The trainer (the Training Manager) acted as a facilitator of group development by bringing up issues for discussion; providing the theoretical framework for observing and analysing group phenomenon as well as other organisational processes; encouraging process observation by participants and generally acting as a 'resource man' for the group. As the laboratory was mainly based on structured exercises and simulations and theoretical lectures and presentations were avoided, the trainer used the data generated by group activities to highlight concepts and issues for group discussion.

4. Ev.aluation of 00 Outcomes Measurement of any organisational effort or activity is necessary in order that it may be evaluated for its effect on the productivity of the organisation. 00 programmes, similarly, need to be subjected to such measurement. In the ultimate analysis, the positive impact of CD effort should be reflected in the performance of the organisation, in terms of tangible, substantial and quantifiable benefits. One might talk of morale being higher than before, of cooperation and team-spirit having improved, etc. but at best the results of the measurement of such behavioural phenomena are suggestivelindicative but not conclusive. Such measurements are still, however, necessary to evaluate the impact of an 00 programme on the attitudes, behaviour and practices in our organisa tion. The goal of 00 being not merely better organisational performance but also the development of a capacity for continuous self-renewal on the part of an

STRATEGY OF EXECUTIVE DEVELOPMENT

119

organisation, the 00 programme necessarily has to be in "operation" as a major purposive effort for say, 2 to 3 years. All the same, measurements of the effects of 00 efforts periodically are necessary to examine the progress of the developmental process, to diagnose factors inhibiting or enhancing 00 and to take appropriate tactical decisions. As 00 programmes are or should be built around task accomplishments, it is possible (though not easy) to measure the outcomes of such tasks in terms of meaningful indices. For example, if task groups in 00 undertake the improvement of an information system for production planning~ the results could be expected to show up in say, more realistic delivery commitments or one could say quantitatively, the numbers of production target-dates being met. Obviously there would be a number of 'intervening' variables affecting the ultimate result operating efficiency of the organisation, but it should be possible through multiple indices to assess the impact of a developmental effort in specific areas with reasonable accuracy. 4.1 Guidelines for Adoption for Criteria for Evaluation

Certain guidelines governed the adoption of criteria for measuring the outcomes of 00 efforts. These were: (a) Their acceptability to the participants, i.e., those involved in 00 efforts: Acceptance of the measurement criteria by those involved in 00 efforts, we believe, are necessary for two reasons: (i) Acceptability is a likely though not necessarily, indication of the appropriateness of the criteria suggested. (ii) More important, acceptance of the criteria would mean in effect that those who are carrying out 00 tasks appraise their own efforts. (b) Relevance to the task: The criteria for measurement should relate to the results of the specific task/ s undertaken. While this sounds simple, it seems to us that it should be bor,ne in mind so that criteria are not developed which relate to more 'distant' possible outcome of 00 efforts. (c) Efforts required for collection of data: As far as possible, the data needed for evaluation of efforts should not impose a new administrative "load." Such data should be obtained from the existing recordings and information systems. Even where new types of information are needed or the present data recording is inadequate, administrative efforts should be weighed against the potential accuracy and usefulness of the new system for the required purpose. 4.2 Criteria for Evaluation -

Project

~'

We submitted the question of evaluation to the participants after an exposition on the subject by the Personnel and Organisation Manager. After discussion among themselves the group felt that certain 'critical' indicators could be identified in respect of the operations of their unit which would be affected if a systemati~ development effort were to be undertaken with success. These according to the group were: (a) The magnitude of machine idle time in the shop. (b) The magnitude of rejects, rework and spoilages in production.

EXECUTIVE DEVELOPMENT

120

These were accepted as appropriate indices for measurement which could be examined after say, 6 months from the commencement of the programme. Since information for management reporting was already being collected periodically in respect of these 'indicators', collection of data for the purpose of the evaluation of 00 programme did not require any extra-administrative effort. 5. Task/Project Teams in Project 'A' 5.1 Identification of Tasks During the laboratory as noted earlier the participants identified through a 'brainstorming' session, some of the issues and problems they were confronted with in their work situation. Such issues ranged over a wide field and included 'technical' problems like 'improvement of the process planning function', 'the need for better communications' and 'training of first-line supervisors.' The issues were further prioritized on the basis of the following considerations: (a) Urgency of the task;

Feasibility of accomplishment within a relatively short period of 3-6 months; Implications of the task accomplishment for the unit's effectiveness. Accordingly those issues were left out of consideration, which were beyond the control of the group or required long term effort for the time being. (b)

(c)

5.2 Formation of Task Teams Of the problems/tasks prioritized, two of high priority ("Communications" and "Detailed Process Planning") were selected and analysed by the participants in depth. Towards the end of the laboratory a task-group was set up to examine these issues and develop a detailed action plan for 'improvement.' 5.3 A Second Laboratory

In planning the next phase of the 00 project, we consulted the participants in regard to their experiences during the laboratory. Generally, there was a feeling that they had gained in terms of a greater awareness of the factors influencing effectiveness of group effort, as well as an appreciation for organisation effectiveness. They also reported an improved understanding of other areas like leadership styles and superior-subordinate relations. However, they expressed the need for more experience in group work and also some 'guidelines' about how they could co-ordinate better with other units/ departments with whom they were closely interconnected. The group further decided that the task team should report to the group during the next laboratory as to the progress achieved in the task. A second laboratory was therefore conducted three weeks after the first, with a special emphasis on the understanding of perceptions of other individuals and groups. A film ('The Eye of the Beholder') was used to illustrate and discuss individual perceptions. We also conducted an exercise in which the group were required to identify a department/unit with whom they had close work relations and to state their perceptions of themselves, of the 'other' department/unit and their guesses of how the 'other' department might see them. The data was used to illustrate the relationship between intergroup

STRATEGY OF EXECUTIVE DEVELOPMENT

121

perceptions and intergroup co-operation. An important feature of the second laboratory for the Shop' A' in Project' A' was that the problems of inter-group co-operation were highlighted and underscored the concern of the Shop 'A' as regards their present state of 'relationships' with the 'other' unit which in this case was another manufacturing shop (referred their as Shop 'B') with whose operations it was inter-dependent. 6. Phase II - Inter-Group Team Development In examining our strategy at this point we felt that it would be appropriate to involve in the 00 effort other units, closely inter-connected operationally with the Shop 'A', as many of the problems between the units seemed to be affecting overall effectiveness of the organisation. We shared our feelings with the Shop' A' group who felt that efforts for inter-group conflict reduction and promotion of co-operative relations should be undertaken. In following upon our idea, we consulted with the heads of the two of the important service units closely inter-connected operationally with the Shop 'A', as many of the problems between the units seemed to be affecting overall effectiveness of the organisation. We shared our feelings with the Shop 'A' group who felt that efforts for inter-group conflict reduction and promotion of co-operative relations should be undertaken. In following upon our idea, we consulted with the heads of the two of the important service units (the maintenance and the inspection) as well as with the manager of Shop 'B' (referred to earlier) and decided on laboratories of shorter duration (3/4 afternoon) separately for each of the three units, to be followed by an inter-group meeting in which select personnel from all these units will participate to explore ways of increasing inter-departmental collaboration. In view of the shorter duration, the laboratories for the Shop 'B' and the service units were structured to provide for limited group activity for understanding of group processes and organisational culture and practices. 6.1 Inter-group Meeting

The inter-group meeting was actually a 'confrontation' in which the different groups shared their perceptions and feelings about each other. Negative images, not surprisingly, were quite predominant and underscored the need for better mutual understanding. Two of the participating groups, viz., the Shops 'A' and 'B' decided to tackle issues of concern to them both, which had implications for the operational efficiency. One of such issues, viz., the development of a production planning system, was felt to be an imperative need and the two groups decided to jointly undertake the task. It was also decided that the departments would explore ways of dealing with questions of common concern. 6.2 Project Team for Tackling Inter-Group Tasks

Following the inter-group meeting, a joint task-group of the two shops was set up to plan and implement a planning system and report on its progress from time to time. The 00 staff were requested to attend the task-group meetings and assist the committee in functioning effectively.

EXECUTIVE DEVELOPMENT

122

The task-group was also asked to develop indices for measuring the results of the effort over a period. This group which included the heads of the two production shops (A&B) and two other members from each of the two shops, have been meeting regularly for an hour or two every week, in a conference room away from their work places, and have reported some progress in the task.

7. 00 Strategy : The OD strategy in regard to Project' A' could be presented schematically as follows: (B)

(A)

Production Manager invites OD effort

Entry Point: Shop A (i)

Team building Lab.

(ii) Task team set up for tackling

(0)

issues/problems in Shop A

Inter-group meeting to promote mutual understanding and collaboration (E)

1

(C) Micro laboraties for inter-connected units: Shop Band 2 service units, on the same model as in B above.

Inter-group action: Setting up task teams for working on issues of common concern

As would be seen from the above, the OD strategy involved team-building effort built around task responsibilities within and between groups. The participants worked through simulated exercises and tasks to actual issues they were concerned within their work situations. It would be seen that the strategy evolved on the basis of our experiences of the earlier stages are not pre-determined. For example, although initially our focus was upon team-building within a unit (Shop A) we found that inter-group issues between Shop A and other inter-connected units were of considerable concern to the Shop and pointed up the need for efforts to improve understanding and co-operation between departments. Furhter, OD efforts were, therefore, in the direction of reduction of conflict and improving inter-group collaboration.

2. IN-COMPANY EXECUTIVE DEVELOPMENT OF THE COSMETICS ORGANISATION The company usually organises 10 to 12 courses in a year and the interesting point is that several of the programmes are of fairly longer duration. Another interesting thing is the fairly long programme of induction and it again shows the importance attached to this programme. There is a 15 day Induction course, when the company history, growth and, philsophy, policies, products, operations, objectives, benefits, rules and regulations are impressed upon the new entrants. There is a 15 day manage-

STRATEGY OF EXECUTIVE DEVELOPMENT

123

ment course to expose and update the skills of managers in several functional areas of management. For junior managers, there are several courses on the various functional areas of management such as production, purchasing, inventory control, marketing etc. There is a 4 days programme on Accounts for non-accountants, so they understand some basic concepts and needs of accounts. There is also a 2 day programme on Domestic Enquiry, since this is considered very important for all the officers. A 3 day programme is on EDP and Computers with a view to exposing the participants to the computer information systems, capabilities and further applications that the company may be contemplating in the near future. This also promotes better cooperation from the managers. There is also a 3 day programme on Linear Programming and its applications. A 7-day Sales Management Course is also organised. It appears that the strategy of this organisation is to organise training and development programme to meet its own and its executive needs. Such need-based programmes organised within the company are considered to be more effective and relevant.

3. IN-COMPANY EXECUTIVE DEVELOPMENT OF THE CEMENT ORGANISATION The brochure on Development programme of 1973 explains the details of the executive development effort. "This is our second brochure. This year a clear distinction has been made between developmental courses for Managers and Supervisory Courses for Foremen. This brochure deals only with developmental courses for Managers. A separate programme will be issued for Supervisory Courses. The conditions under which the Courses will be held have been clearly set forth in this brochure, and it is requested that due note be taken of them. The Training Programme for this year has been carried a stage higher, and will cover the following areas: Courses in functional ares: Financial, Personnel, etc.; Developmental Programmes: Senior, Middle and Junior level; Special courses dealing with such conceptual areas as MBO, MIS; Innovative Problems Solving courses; Refresher Courses in Management. The strucutre of each course has been briefly described in order to enable nominations to be made with the specific reference to the needs of individuals. If training is to be effective, it is essential that a much closer liaison be maintained between the Training Manager and Senior Line Managers, Divisional & Departmental Heads. This close liaison will enable the training programmes to be organised to meet the requirements of Management Development in this Company. 1. Organisation

A company Training Section has now been functioning under the Personnel Director in Head office for about a year. The Section is manned by a Training Manager and a Training Officer.

EXECUTIVE DEVELOPMENT

124

2. Training Facilities (i) Head Office: A Training Hall in the Head Office has now been set to accommodate a class of 30 participants. It is equipped with good audio-visual aids, such as an Overhead Projector, a Slide Projector, a Tape Recorder etc. A Film Projector is available with the Publicity & Public Relations Division for projecting 16 mm. sound films.

The nucleus of a good management library has been set up. Also a catalogue of books available in the various Divisions/Departments in Head Office is maintained by the Training Section. Officers are welcome to use these library facilities. 3. Development of Faculty

Our policy of developing internal faculty has paid handsome dividends and we are now largely in a position to meet the training needs of our Company both in functional and developmental areas. But hitherto the members of the faculty have been drawn primarily from the Officers of Head Office. During the year it is proposed to encourage Officers from the factories to specialise in areas of Cement Manufacture and Management. For this purpose managers of the factories are encouraged to allow Officers who wish to specialize in a particular area to keep in touch with the Training Manager. In the course of this year, training will be taken to a higher level so as to bring about a deeper impact upon the Organisation. It should now be possible for us to teach and to disseminate information on most of the new concepts and techniques. It should also be possible for us to improve our organisational communication and styles of management so as to make the Organisation as a whole much more efficient and effective. It is hardly necessary to emphasize that there is still great scope for further developing internal faculty and encouraging some of them to handle more difficult concepts in particular fields of specialization.

4. Management Development

With our experience of the previous year, we are now in a position to improve our Management Development practices. There are three specific stages in such development: (i) Pre-Trainillg(On-tlze-!ob), which is primarily the job of every Senior Officer. (ii)

(iii)

Training, which will now cover three areas: (a)

Regular training;

(b)

Problem solving; and

(c)

Innovative training.

Post-training: The opportunity and encouragement afforded to an officer to implement new ideas and concepts on the job.

If this Management Development is to go forward rapidly, a much closer liaison between the Training Manager and the more Senior Line Managers is necessary. Line Managers should, therefore: feel free to communicate their doubts, difficulties and suggestions directly to the Training Manager.

STRATEGY OF EXECUTIVE DEVELOPMENT

125

5. Objective

Against this background, the training objectives for the year 1973 would be briefly summarized as follows: (i) To endeavour to improve the communications in the Organisations; (ii) To spread the acceptance of such concept as MBO and MIS; (iii) To bring home to individual officers the need for a more effective style of management; (iv) To widen the horizon of senior managers by providing an opportunity for interchange of experience within and outside the Company; and (v) To promote a more harmonious group development which in turn is based on higher morale and job satisfaction. Management Development : Management Development Programme will be much more sophisticated and will cover functional, developmental and conceptual areas. But if these courses are to help the Company to promote the effiCiency of various cadres, it is necessary for senior line managers to keep in touch with the Training Manager and to convey an accurate feedback on the effectiveness of such courses. Training Aids: All training centres have been considerably developed. AudioVisual aids have been greatly improved. A number of case studies and exercises have been added. The library has also been improved. Any officer desiring to specialise in any particular field may avail of the facilities and expertise of the Training Section to improve his knowledge and skill in any particular area. Internal Programmes: For Lower Supervisory Level, Junior Level, Middle Level and Senior Level at Head Office, Branches and Works. Name of Programme Developmental l. Junior Level Management Programme 2. Middle Level Management Programme 3. Senior Level Management Programme Supervisory l. Lower Supervisory Level (For Erectors) 2. Lower Supervisory Level (For Salesmen)

3.

Lower Supervisory Level (For Foremen) Functional l.

2.

Lower Supervisory Level (For Burners) Finance for Non-finance Executives

Duration

Frequency per Year

Number of Participants

Kymore/ Shahabad Matheran

15 18

Twice Once (Nov.)

39

NITIE

12

Once (Dec.)

23

Mumbai

5

Thrice

29

Delhi, Ahmedabad, Secunderabad Kymore

4

Thrice

41

10

Once

10

Shahabad

6

Once

13

NITIE

6

Once

19

Venue

17

126

EXECUTIVE DEVELOPMENT

3. Medical Officer's Refresher Course 4. Executive Course on Computer 5. Personnel for NonPersonnel Officers 6. Analytical Aids to Management

7. Materials Management 8. Planned Management 9. Marketing Management 10. Production Management

H.O. H.O.

13 4

Twice Once

29 13

H.o. H.O. H.O. Shahabad Kymore NITIE Kymore

5 5 5 7

Once Once Once

19 17 12

6

Twice Once Once

18 16 20

6 10

GET's Programme: During the year under our GET's Scheme, we recruited 15 Graduate Engineer Trainees (IV Batch) from Engineering Colleges in April and 22 Graduate Engineer Trainees (V Batch) from various Indian Institutes of Technology. We also organised the following Training Programmes for the III, IV and V Batches of these GETs Training Programme for 1972. Name of Programme

Venue

Duration

Total Number of GET's

Shahabad

6 days

22

H.O.

5 days

13

Shahabad

6 days

13

H.O.

5 days

22

l. GET's Skills Programme for

(III Batch). February, 1972. 2. GET's Induction Programme. (Non-IIT's - IV Batch). April, 1972. 3. GET's Skills Programme for (IV Batch). July, 1972. 4. GET's Induction Programme (V Batch). August, 1972

On the Job Training: On completion of their training, the Graduate Engineer Trainees are posted to Cement Works. TRAINING PROGRAMME FOR 1973

Sr.

No.

Months & Dates

Days 13

Titles XVII Jr. Level Management Programme

Venue

l.

Jan. 8-20

2.

Jan.29-Feb.2

3.

Feb. 12-24

V Batch GET's Skills Programme

Kymore

4.

Feb. 26-Mar.3

6

V Planned Maintenance Programme

Kymore

5.

Mar. 5-9

5

I PersOlmel & Industrial Relations for PWOs.

H.O.

6.

Mar. 12-16

5

II Personnel & Industrial Relations for PWOs.

H.O.

5 10

Symposium on Geology, Chemistry and Mining of Cement Raw Ma terials.

Kymore H.o.

STRATEGY OF EXECUTIVE DEVELOPMENT

127

7.

Mar. 26-30

5

Management Information & Control System.

H.G.

8.

Apr. 2-3

2

I Seminar on Domestic, Enquiry and Industrial Disputes Act.

H.O.

9.

Apr. 5-6

2

II Seminar on Domestic, Enquiry and Industrial Disputes Act.

H.O.

10.

Apr. 9-13

5

II Analytical Aids to Management.

H.O.

II.

Apr. 23-27

5

Seminar on Management by Objectives.

H.G.

12.

May 14-25

12

I Office Supervisors' Programme.

H.O.

13.

Jun. 18-30

13

XVIII Jr. Level Management, Development Programme.

14.

Jun. 25-29

5

II Materials Management Programme.

H.G.

1.5.

Jul. 9-14

6

VI Planned Maintenance Programme.

Kymore

Shahabad

16.

Jul.23-27

5

I CAl Training Programme for Engineers.

H.O.

17.

Aug. 6-8

3

GET's Refresher Course for r & II Batches.

H.O.

18.

Aug. 20-24

5

Integrated Approach to Cement Problems.

H.O.

19.

Sept. 17-19

Public Relations & Corporate Image.

H.O.

20.

Oct. 8-20

3 13

II Production Management Programme.

Kymore

2l.

Nov. 5-23

19

XI Middle Level Management, Training Programme.

22.

Dec. 3-14

12

VIII Senior Level Management Programme.

23.

Dec. 17-21

5

I Financial Planning & Control.

Matheran NITIE H.O.

4. IN-COMPANY EXECUTIVE DEVELOPMENT OF THE TEXTILES ORGANISATION The following Table gives the in-company effort of this organisation. It gives the level of participation, area of management function, programme, objectives of the programme, duration, dates and number of participants. CALENDAR OF MANAGEMENT PROGRAMMES

Subject

Programme Objectives

No. of Participants

Seminar on "Corporate policy with regard to Investments"

-

To stimulate thinking on 'Corporate policy with regard to Investments.'

30

Seminar on "Growth of Managerial Leadership"

-

To consider new ideas in organisation behaviour which are relevant for the growth of managerial leadership and examination of various leadership styles.

30

128

" Accounts Managelnent"

"Secretarial Management and mechanization of Business Practices"

"Purchasing & Stores Management"

"Marketing Management"

"Personnel Management including Industrial Relations"

EXECUTIVE DEVELOPMENT -

To study various techniques of costing, Cost Control and reduction of Cost and the problems involved in applying costing methods in manufacturing operations etc.

-

To improve the efficiency of Accounts Management activities in our units.

-

To examine the role of secretarial function in manufacturing and marketing organisations.

-

To understand the significance of organisation and methods and their relative importance.

-

To provide an appreciation of mechaniza tion of business practices to increase efficiency and reduce costa.

-

To review some of the modern systems and techniques of stores & Purchase Management.

-

To appreciate practical applications of quantitative techniques to stores and purchase management and there by understand its significance to increased profitability.

-

To apply modern marketing concepts in the Indian environment and their implication for management.

-

To discuss some of the current topics of special interest, viz., emerging Rural and International Markets.

-

To enable participants to update their knowledge of individual and collective human behaviour in an organisation, in the light of findings of behavioural sciences.

-

To improve their skills in training and development, appraisal and counselling of subordina tes.

-

To update their general understanding of industrial relations and problems of discipline and grievance handling.

25

25

35

25

STRATEGY OF EXECUTIVE DEVELOPMENT

"SuperVisory Development Programme on Industrial Relations"

"Supervisory Development Programme on Production Management"

129

-

To develop problem-solving and decision-making skills and attitudes of critical enquiry, evaluation and personal development.

-

Towards a better understanding ot human reiations in work situations.

-

To obtain new perspectives in industrial relations relevant to supervisory work.

-

To provide a better understanding of the technical contents of a Supervisor's job in manufacturing Units.

-

25

25

To familiarise him with the techniques of production management like production planning, inventory control. Operations research PERT and workstudy and thereby up-grade shop-floor efficiency.

It is clear that programmes are targeted at all levels of management based on their needs. All the important functional areas of management are sought to be covered. While the duration of the programmes is geared to the level of participants. Higher the level, smaller the duration and vice versa. The strategy is to develop every manager to update his skills and to prepare him for higher assignments.

5. IN-COMPANY EXECUTIVE DEVELOPMENT OF THE STEEL ORGANISATION This company organises a 4 tier management development courses. Functional and cross-functional courses, orientation courses, need-based seminars and panel discussions, follow-up seminars, panel discussions, and tea meetings. The details of this effort are as follows: PROGRAMME SCHEDULED AND CONDUCTED DURING THE YEAR 1972

Programme Title

No. Scheduled

No. Conducted

Batches Participants Batches Participants

(2)

(3)

(4)

(5)

1. 6-Day Supervisory Development Course

21

327

19

335

2. 6-Day Senior Supervisory Development Course

11

176

11

194

2

40

1

24

1 -

24 -

(1)

A. 4-Tier Management Development Courses

3. 12-Day Management Development Course 4. 2-Day MDC Review Session

130

EXECUTIVE DEVELOPMENT (1)

(2)

(3)

(4)

(5)

B. Functional/Cross-Functional Courses

5. 5~-Day Office Supervisory D:velopment

4

·

53

3

45

6. I-Day Follow-up course of OSDC

3

45

2

21

7. 5-Day Supervisory Development Course for Overmen at Collieries

3

65

3

62

18

338

28

462

1

20

-

-

10. 2-Half-Day Course on "PERT jCPM"

6

107

5

88

11. 6-Day Senior Sllpervisory Development Course for officers of the Town Division

1

20

1

11

12. 6-Day Senior Supervisory Development Course for officers of the Town Division

1

20

1

11

13. 6-Day Junior Supervisory Development Course for Town Engineering Personnel

1

20

2

40

14. "Running-A-Meeting" Course for Officials of JDCs and Joint Committees

3

36

4

41

15. I-Day Review Session of Advanced Job Methods Course

1

12

1

18

16. I-Day Special Training Programme for ShipFing Personnel of Mills Departments

8

172

8

172

17.

1

20

1

42

18. Special Work Simplification Course for Works Supervisors

1

25

-

-

19. I-Day Special Training Programme for Pitside Supervisors of SMS (conducted as a Seminar)

1

15

1

46

20. I-Day Special Training Programme for Supervisors of Transportation Department 21. I-Day Special Training Course for Chasers in the Works

1

15

3

58

-

-

3

76

21

550

22

555

23. 3-Day Orientation Course for newly recruited professionals

3

42

3

57

24. I-Day Orientation Session on "Joint Consultation" for JDC Officials

2

27

2

30

25: 3-Day lSI Appreciation Course on "Country Standardisation"

1

36

1

36

Course (OSDC)

8. 3-Day Systematic Maintenance Course 9. 5-Day Course on Personnel and

·

Organisational BehavIOur

~-Day Course on "Value Engineering" for

·

·

Senior Maintenance Supervisors

C. Orientation Courses

22. 2-Day Problem Oriented Course for Works Supervisors

· · ·

131

STRATEGY OF EXECUTIVE DEVELOPMENT (1)

(2)

26. 2-Day Appreciation Course on "Job Evaluation and Remuneration" for Managers in Collieries

1

(4)

(3) 18

1

(5) 16

D. Need-based Seminars/Panel Discllssions (a) Semi1lars : 27. Human relations

1

18

1

18

28. Lubrication

2

50

2

40

29. QUdlity Control (1) lron Making, (2) Steel Making and (3) Mills

4

93

3

88

30. L & T Seminar on "Futectic Low Heat Input Metal Joining Process"

1

60

1

60

31. Use and Care of Fabric Bearings

1

45

1

38

32. Productivity Concepts

1

20

1

25

33. Transportation Problems inside the Works

-

-

1

53

-

-

1

65*

35. (1) Lubrication, (2) Quality Control in Steel Shops, and (3) Quality Control in Mills

3

98

3

94

36. Executive Health (Two Sessions) 37. Problems relating to the preparation of Despatch Advice and Test Certificate in Mills

2 1

150 17

2 1

138 17

38. Research and Development in Tisco

2

160

1

80

39. Plant Operation in the context of Power Crisis

1

80

1

80

40. Other Seminars

6

210 -

-

-

.

34. Fiim-aided discussion on "PERT/CPM" (b) Follow-up Seminars:

E. Tea Meetings

*

14

11

More than scheduled

In addition, the executives of the company also attend programmes organised at the Group training centre. Name of Programmes

Dates

Management by Objectives and Results

January

13 to 21

Selection Techniques

January

23&24

TAS Selections

January

29&30

Way to Executive Health

February

18 to 20

Management Appreciation for Graduate Engineers

March

Marketing & Sales Management

May

16 to 20

Management Accounting for Non-Financial Executive

May

22 to 27

2 to April 5

EXECUTIVE DEVELOPMENT

132

4 to 8

Management of Research & Development

June

Workshop on Management - Union Relations

June

22 to 30

Procurement Management

August

13 to 16

Managerial Effectiveness

September

13 to 22

Management Development Programme

September

27 to Oct. 25

Secretary's Conference

November

2 to6

Senior Management Programme

December

7 to21

Management of the PR Function

December

27 to 31

6. IN-COMPANY EXECUTIVE DEVELOPMENT OF RUBBER ORGANISATION The company generally organises about 17 courses h a year. These are general management courses, specific specialised courses, computer appreciation courses, EDP courses and courses on various functional areas of management. The strategy is to cover all levels of executives including the top and all areas of management so that the needs of all executive personnel are met. Development of courses and the kinds of courses are determined in the Personnel Managers Conference and a working budget for the next 12 months is planned after c. review of the last 12 months. The decisions taken in this conference are implemented in the course of the year.

7. IN-COMPANY EXECUTIVE DEVELOPMENT OF THE TEXTILES ORGANISATION This company has developed its in-company executive development effort on the basis of the manpower planning, performance appraisals and training needs survey, where it has identified both organisational and individual training and development needs. The strategy is to cover all levels of executive cadre and potential executives and to expose them to management and on primarily basic areas of management, such as production management, systematic plant maintenance, cost reduction and control, financial management, human resources management, computer applications, safety, productivity, human relations and motivation, techno-managerial, basic management, etc. It organises about 25 programmes every year. In 1972 about 434 executives attended the in-company programmes. In these programmes, priority is given to potentials for higher assignments. The following is the list of the executive development programmes: Training and Development Programme

Duration

Cost Reduction Technique

(One week)

Techno-Managerial Programme

(One week)

Domestic Enquiry

(3 days)

Human Relations Basic Management Programme

(One week)

Production Planning & Control

(Two weeks)

(One week)

STRATEGY OF EXECUTIVE DEVELOPMENT

133

Executive Development Seminar

(One week)

Seminar on Management

(1-3 days)

Seminar on Technology

(1-3 days)

Systematic Plant Maintenance

(Two weeks)

Materials Handling

(One week)

Cost Reduction Techniques

(One week)

Total Quality Control in collaboration with CQC

(3 days)

Basic Management Programme

(OnE-week)

Human Relations

(One week)

Systema11CPlant Maintenance

(One week)

Seminar on Management

(1-3 days)

Seminar on Technology

(1-3 days)

Production Planning & Control

(Two weeks)

Systematic Plant Maintenance

(One week)

Materials Handling Refresher Course

(One week) (3-5 days)

The in-company programmes are considered more effective and relevant because they are tailored to the needs of the organisation and its people and majority of the sessions are handled by the internal executive faculty, who talk about some relevant problems and solutions. The in-company programmes are less costly (about 9 times in this case). There is also a systematic effort to transfer new learning on to the job and thus keep introducing modern management concepts, tools and techniques. This contributes to the effectiveness of the in-company effort. Summing Up

We state that while not all sample organisations are quite satisfied with their in-company formal off-the-job executive development programmes, a majority of them (7 out of 12) feel that this strategy is very effective and relevant. Most of the programmes are geared to meet the needs of the organisation. A considerable amount of time, thought, effort and expertise goes in the evolution, development and administration of executive development programmes. There is an attempt in the majority to integrate the in-company effort with the general processes of personnel administration. Most of the organisations organise programmes geared to the different levels of management and thus attempt to cover all levels of executive cadre. Most functional areas of management are also sought to be covered. It is also generally felt that in-company programmes are considerably less costly. However, it must be mentioned that a major problem with those companies, who have their training centres is that they are worried about the under-utilisation of these centres. In fact no organisation is able to organise enough programmes to utilise their centres fully throughout the year. There is a great scope for improvement in the organisation of the quantum of in-company programmes. However, here the major limiting factors seems to be the executive development staff and most sample organisations just do not have the organisation to perform better. We shall deal with this problem of organisation of executive development department later in a separate chapter. Suffice it to say at this juncture, this is a major weak area.

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EXECUTIVE DEVELOPMENT

In-Company Programmes by External Agency Sometimes a company may invite an external agency, which may be Institute of Management, National Productivity Council, National Institute of Training in Industrial Engineering, Management consultants, etc., to conduct unit-based programme. It is interesting to note that the sample organisations report that they do not have this practice and they do not invite an external agency to conduct a programme within their companies. However, one organisation (textiles) indicates that it did invite National Productivity Council to conduct a programme and that was when the company did not have its own executive development expertise and since then the company has been organising its own executive development programmes with its own expert help. Nevertheless, there is another interesting practice among some of the sample organisations with foreign connections and that is a co-operative programme where four of our sample organisations in the eastern region organise an executive development programme for their executive personnel. This sort of a co-operative programme has several advantages. First, it cuts down the costs of a programme because four of them can share the costs. Secondly, more executives can attend a programme so that it becomes a viable effort, because it becomes difficult to organise a programme on, say, Marketing Management, just in one company, because there may not be enough participants and you cannot organise a programme for just 3 or 4 people. Thirdly, the participants can share, exchange and update their experiences drawn from several companies and this promotes considerable amount of learning. Fourthly, they can draw from the expertise available in these companies to serve as faculty for these programmes. Fifthly, more executive development programmes could be organised and share the facilities available in the training centre of one of the companies. Another very interesting practice is not only unique but also trailblazing, where a co-operative programme with private sector steel organisation in our sample and a public sector steel organisation and another public sector engineering organisation combine in order to organise a co-operative executive development programme. This IS all the more notable because the long and creditable experience of the private sector steel organisation, would be beneficial to public sector organisations which are of recent origin. Not only that, the very highly commendable thing is that the steel organisation has opened its gates to provide training and development facilities and train and develop the public sector steel and engineering executive and supervisory personnel. This sort of a co-operative executive development between private and public sectors is not only a very unique and praiseworthy but also very highly useful to the participating organisations, particularly to the public sector organisations. This practice is worth emulation in other industrial categories between private and public sector organisations. The exchange of experiences, ideas, views, problems and prospects help both the private and public sector organisations and their executives. The exchange of executive personnel between the sectors would help in the development process and to some extent this is already happening. Some key executives of the steel and cosmetics in our sample are working in the public sector organisations either on loan or on a permanent basis. Strategy III - Out-company Executive Development Effort The sample organisations strive to supplement their in-company effort with out-company executive development effort and rightly so. This strategy is necessary

STRATEGY OF EXECUTIVE DEVELOPMENT

135

largely because no company will be in a position to meet all its revelopment needs through only its in-company effort. This is also in consonance with global pattern. TABLE 10.3 USE OF OUT-COMPANY AGENCIES IN PRIVATE SECTOR

Sr. No.

Agencies

Number

Per cent

12

8.

Professional Associa tions

9. 10.

Other Companies

11.

Chambers of Commerce

3

100 92 100 100 100 67 25 100 42 17 45

12.

Others

1

8

1.

All India Management Association (AlMA)

2.

National Productivity Council (NPC)

11

3.

Administrative Staff College of India

12

4. 5. 6. 7.

Indian Institute of Management, Ahmedabad (IIM)

12 12

Indian Institute of Management, Calcutta University Management Schools

8

National Institute ofTraining in Industrial Engineering (NITIE)

3

Management Consultants

12 5 2

There is a number of out-company agencies that specialise in offering a variety of executive development programmes for different levels of executive hierarchy. Thus, there is a wide choice of organiSations and programmes available for companies to choose from. We asked the sample organisations what out-company agencies were used by them and of them who were found to be the most effective? The respondents use more than one agency. The Table 3 shows the external training and development agencies used by the sample organisations. All India Management Association, Indian Institute of Management, Ahmedabad and Calcutta, Administration Staff College of India, Professional Associations are the out-company agencies that are used by all the sample organisations. All organisations except one (oil) participate in the programmes conducted by the National Productivity Council. University management schools are popular with 8 organisations covered in our study and the organisations are 2 textiles, 2 engineering, rubber, steel, cement, chemicals. Some 5 companies (rubber, aluminum, tobacco, steel and engineering) report that they use the facilities and programmes organised by other companies. Mostly these are the co-operative programmes that we referred to earlier? The other external agencies which are not so widely utilised, are NITIE by 3 organisations (2 textiles and engineering); management consultants by 2 organisations (aluminum and cement); Chambers of Commerce by 3 organisations (2 textiles and chemicals); Shri Ram Centre for Industrial Relations by one organisation (oil).lt is clear that though there is a plethora of agencies, our sample organisations have chosen only a few agencies to meet their needs of development. Procedure of Nomination

How do the sample organisations decide who is going to attend what programme organised by whom? There are several methodologies and procedures followed by the

136

EXECUTIVE DEVELOPMENT

sample organisations, unlike many organisations, who simply depute a separable person to a programme whether he needs it or not. However the sample organisations have systematised the nomination of executives to out-company programmes to varying degrees. The most popular methodology is to identify the individual training and development needs through the performance appraisal and then plan to meet these individual needs through in-company and out-company effort either on an annual basis or on a three year or four year or five year plan basis. Another procedure is to invite nominations from the heads of departments or divisions or units to specific programmes and then send them to out-company programme. Usually there is an age, education and service qualifications. Another methodo-Iogy is to plan individual executive development on the basis of executive resources planning, career development planning and management succession systems. Another procedure is to react to every programme notice from the various out-company agencies and to nominate an executive for the programme. Several of our sample organisations may use a combination of these methodologies and procedures. It is a matter of policy in some of our sample organisations to support certain out-company agencies and use their facilities and programmes. In about 7 organisations (rubber, aluminium, tobacco, steel, cosmetics, oil & textiles) it is a combination of executive resources planning, career development plans, executive succession systems and performance appraisals that determines who attends what programme organised by whom on a formalised, systematised and planned manner. For instance, one of these organisations (steel), as a result of its combination systems, every year the in-company executives are earmarked to attend the General Management Course organised at its group training centre (in addition to a 9 day in-company management development course); high talent personnel attend 4 week executive development course at the group training centre; the 10 week Senior Management Course at ASCI; a team of 3 executives drawn from three levels of top, middle and junior management attend 3 Tier Programme of lIM, Ahmedabad; 1 senior executive attends the Advanced Management Course of AlMA & lIM, Calcutta at Srinager, 3 junior executives attend the Junior Executive Course of 4 weeks Management Development Course of Calcutta Management Association; different functional executives are earmarked to attend all the relevant functional courses at the group training centre. Executives above age 58 years are not usually considered for executive development effort.

Another organisation (textiles) every year prepares a Out-Company Executive Development Brochure, which details the programmes organised by only ASCI, lIMA, IIMC, NPC, NITIE, and AlMA and the brochure is sent out to all the chief executives of all the companies in the Group asking them to plan their nominations; the Management Development Division checks on the appropriateness of the nominations in the light of executive resources planning, succession systems and appraisals and if they are all right, it arranges for reservations at the various out-company, agencies. It sees that the nominated executive attend the programme and there is a follow up, which includes a talk, a report on the course, suggestions for implementation. We shall now quote the procedure from the brochure of this organisation. Procedllre for nominating Officers and Assistants to Ollt-Company Training Programmes. The following procedure would be followed in nominating candidates for outcompany training programme:

STRATEGY OF EXECUTIVE DEVELOPMENT

137

(1) The Chief Executives, Functional Heads, Managers, and Departmental

Heads will get acquainted with the course particulars given in the brochure and recommend those courses which are suitable for officers and Assistants under their charge. (2) They will prepare a statement in Proforma" A" giving the names of the employees and the titles of the courses to which they are nominated and send the list to the Central Personnel Department. (3) To facilitate the process of development ·the Central Personnel Department may: (i) Select an individual who, in its opinion, should undergo a specified course and recommend his name to the Chief Executive. (ii) Select courses which would be beneficial to the persons holding specified jobs and communicate them to the Chief Executive. (4) Priority will be given to : (i) Employees selected as potentials for higher positions; (ii) Employees who have never been exposed to formal training and development programmes. (5) In recommending the candidates the following criteria may be followed: (i) The candidate should have put in at least 3 years of service in our or: ganisation; (ii) The course should help the candidate to improve his ability to perform the present assignment on the job; (iii) Minimum educational qualification prescribed for the course should be adhered to; (iv) Age of the candidate should not normally be more than 50 years; and (v) Not more than one candidate for the same course from one unit at a time. (6) The Central Personnel Department will go through the list of nominations and if the nominations are in order, arrange for provisional reservation of seats with the Institutes. The unit concerned will then be sent the enrolment forms to be' filled in and sent to the Institute directly along with the fees under advice to the C.PD. (7) Should any candidate be not in a position to attend a particular course, the C.PD. should be informed immediately to enable it to cancel the provisional reservation. (8) In exceptional cases, if any unit/ department sponsors candidates for courses directly it should keep the C.P.D. informed of the same. (9) The candidate after returning from the course will make a brief report to the Chief Executive of his unit in Proforma "B" and forward a copy thereof to the Central Personnel Department within a fortnight of his return. (10) The Manager will send a report to the Chief Executive of his unit on the feasibility of implementing the suggestions made by the participant. In 4 other organisations (engineering, textiles, cement & chemicals) nominations are determined from the appraisals and they also react to the out-company agency notices. In another organisation (engineering) it is pretty much informal and generally it supports the efforts of AlMA, IIMA, and ASCI.

EXECUTIVE DEVELOPMENT

138

Effectiveness Have the sample organisations ever evaluated the effectiveness of the executive development programmes organised by the out-company agencies? We further asked the respondents to indicate 3 or 4 agencies whose programmes were found to be most effective. It comes as a surprise to note that the majority of the respondents (8 or 67%) indicate that they have not evaluated the effectiveness of these out-company agencies and they have not given much thought to this effort. However, some 4 organisations (33%) have some sort of evaluation of the outcompany agencies and they also indicate some 3 or 4 agencies whose programmes are found to be most effective. The 4 organisations covered in the study are tobacco, steel, engineering and textiles.

The tobacco organisation indicates that the programmes organised by AlMA, ASCI, and professional associations are found to be most effective. In the opinion of steel and engineering organisations they are AlMA and lIMA and administrative Staff College of India. In the evaluation of textiles organisation, they are ASCI, lIMA, lIMe. In these organisations the out-company nominations are concentrated in these effective out-company agencies and their programmes. The majority of the respondents (8 or 67%), without any sort of evaluation, do not seem to have determined the criteria on which to evaluate the effectiveness of out-company programmes. Undoubtedly this is a crucial problem, particularly in view of the plethora of organisations which allege to and threaten to conduct executive development programmes. It is necessary for these organisations in our sample to develop a set of criteria to evaluate the effectiveness of out-company agencies and their programmes. It may be of some interest to quote here the memorandum of one of our respondents to a leading outcompany agency on the problem of evaluation. Evaluation of ABC Management Programmes (1) The ABC had decided to evaluate its management programmes in three parts: (i) the programme itself, its objective, content, methods etc.; (ii) its administration;

its financial results. (2) The council has desired a report on the best appraisal of the first part, and this paper is an attempt to offer the Council our thoughts on it. (3) The evaluation of a programme is normally done during the programme itself, whereas it should be built-in in the following three stages: (i) at the planning stage; (ii) during the course of the programme; (iii) the feedback stage. (4) The next question that arises is, who should be responsible for evaluation. In the present organisational set-up of the ABC, it has been agreed that responsibility could best be fixed on the senior faculty member or Course Director, for the simple reason that he has overall responsibility for the course, from laying down its objectives, to its programmes and its results. At a later stage, ABC may consider the need for more sophisticated evaluations (iii)

STRATEGY OF EXECUTIVE DEVELOPMENT

139

with the help of a special officer for this purpose, with a post-graduate degree in Social Sciences, and preferably with some experience in industry. Such an Evaluation Officer could assist the senior faculty member and the Executive Director in programme evaluation. Whilst others are responsible for the conduct of the course, in teaching and in administration, the Evaluation Officer could devote his single-minded attention to receiving a feedback from the members of the course, interviewing as many as possible during the course and at its end, and make his observations available to the course director. He could also be in touch with members of the course some months after the course is over, to get their reactions when the gilt is worn off, and when the freshness of the course experience settles into work attitudes and work practices. Such a process would enable evaluation in depth. (5) The course director should clearly state the objective of the course, and devise the best teaching methods for them. The course can then be evaluated on the basis of its objectives, and the suitability of its methods. Each objective, and each part of the course, should be open scrutiny as to whether the best methods of imparting knowledge and experience, and getting involvement have been adopted; whether the methods adopted are suited to the experience of the course members; whether the best audio-visual aids have been adopted when they could be more effective. (6) The next area of appraisal is the level of activity of the participants, the degree of involvement and the response which the course may have produced, especially in new areas of thought and experience. Have the course members received the best available reading material and in time? Has the reading material been read, or found too heavy and unreadable? (7) In some cases, when programmes are in the nature of workshops, and it may be expected that course members may be in a position to take steps to implement new ideas, systems or policies, it may be advisable for ABC to follow up with course members, say, three to six months after the course, to find out to what extent there has been some practical follow up. This may have two advantages. Firstly, it gives course members the impression that courses are not just talk-shops, and that some practical follow up will be expected. Secondly, when there is a follow up, even though it may be in less than half the companies concerned, it acts as a tangible encouragement to the promoters of management programmes. It may well, therefore, form a part of programme appraisal. (8) Opinion is divided with regard to the advisability of attempting to quantify appraisals with rating scales for different aspects of the programme. Some personnel men feel inclined to do so. Our view is that the majority of managers are skeptical about quantification; partly because of doubts about the validity of the rating system, and partly because there are doubts whether some aspects of the programmes can be quantified. We would therefore, hesitate to recommend quantification in course appraisals, but if the ABC Council wishes to experiment with it to get experience of quantification, and to test its validity over a period of time, it may be approached with an open mind. To enable Council Members to look into the possibility of such a method, we are attaching a possible assessment form with hypothetical ratings.

140

EXECUTIVE DEVELOPMENT

This would offer a basis for the evaluation of out-company agencies. The feedback of the participants should be of considerable benefit; but it is necessary to help the participants with a set of criteria to evaluate the agency and its programme. Criticisms

There are several criticisms of the out-company agencies. The major criticism is in respect of the cost of the programmes and they feel is on the very high side. One of the top executives of our sample (oil) expressed forcefully; "Why the hell should they charge such high fees. By its very high prices, they eliminate larger participation. Only the fat cats can come and they are well aware of the modern management concepts and techniques. It is the other medium and small industrialists who need them very much; but they can't afford these high price tags. To that extent the effectiveness of these organisations in spreading management education and in introducing modern management concepts, tools and techniques in the country will be minimal." The top personnel executive of the textile organisation makes these observations: "We are primarily operating in two groups of industries - textiles and chemicals. A constant complaint of all our executives and managers who attend ASCI or IIMs or any other out-company executive development programmes, is that the courses do not meet the peculiar and particular, needs of our groups and they talk only of the problems of engineering, machine tools industries and not textiles and chemicals. They come back unhappy from these programmes. To meet this situation, I have several invitations to the senior faculty to come and study our industries and develop relevant case material, course material, and appropriate examples. However, there are no takers and we continue what at best can be characterised as a frustrating situation." Here the problem of relevancy in learning is in the forefront. This executive referred to the inflationary trends in the pricing of executive development programmes, to which we have alluded earlier in this volume. The other problems referred to are the course material, efficiency of administration of these programmes, faculty, pedogogical approaches, training aids and facilities and several of our sample organisations find that there is considerable room for improvement in the above areas. It must be said, however, that the sample organisations are committed to support and use the out-company agencies and their programmes and this is the positive trend in the executive development effort of the respondents. One top personnel executive (textile) opined:

"The interaction of our executives with their peers from other industries in itself is beneficial and their sharing and exchange of experiences, problems and ideas result in quite a bit of learning. This is a plus point we are seeking. One of our senior executives attended a programme at ASCI and came back with a lot of bounce and confidence in himself. His interaction with other senior executives from private and public sectors reinforced confidence in his own executive capabilities and this reassurance worked wonders in his case. That is why we continue to send our executives to outside programmes. But we are decidedly not in favour of sending an executive to short programmes of half a day or one or even three days. We want the programme to be intensive and there must be definite learning impact. We send our senior executives to 4 week, 6 week, and even 10 week programmes. We don't say that they can't be spared for that long. Our policy is to ignore very short external programmes and also programmes of

STRATEGY OF EXECUTIVE DEVELOPMENT

141

great many fly-by-night operators. We have only four or five out-company agencies where our executives go to pa:rticipate." The same opinion is held by the steel organisation, to which we have referred earlier in this volume. The top personnel executive of the engineering organisation maintains: "We believe in supporting external executive development programmes for our senior executive personnel, for internal programme will not be effective." However, this goes counter to going opinion of 2 textiles, cosmetics, cement, oil, steel and engineering organisations where senior executives are also developed through in-company effort, which is considered to be pretty effective. The trend is to increasingly utilise the external executive development agencies and to participate in inter-sectoral and inter-industry programmes offered by the out-company agencies. the interest in such programmes is due to what one senior executive observed: "I know a great deal about my industry. I am familiar with the common systems, procedures and policies of management not only of my companies but also in the same industry. But I want to learn from the other management systems, procedures and concepts used in other industries and sectors so that I may explore the possibilities of adopting them to my own situation. I am always looking for such possibilities and I believe we learn a lot that way. Besides, it must also be observed that no organisation can meet all its executive development needs only through in-company effort and hence the sample organisations supplement, rightly so, in-company effort with external executive development effort also. This is a sound strategy. Strategy IV - Out-country Executive Development The next important strategy of executive development effort is to send executives abroad for not only training and development and observation assignments but also to undertake specific job assignments with a view to developing them. The latter is possible particularly in case of the foreign-controlled companies (50% or 6) in our sample. While all the sample organisations send their personnel for technical training, only 10 organisations depute the executives for management education and development programmes. Of these 10, 6 or 50% of our sample are the foreign subsidiaries, who send their executives mostly to the programmes organised by the parent company and these organisations are aluminium, rubber, tobacco, cosmetics, oil and chemicals. The other 4 are Indian organisations, and they are textiles, steel, engineering, cement organisations. The other two organisations, which are not sending their executives for executive development, are engineering and textiles and even they are planning to utilise the out-country agencies and facilities such as American Management Association, British Institute of Management, Conference Board in USA, Harvard etc. The engineering organisation is proposing to provide opportunities of foreign travel and educational experience in management to their executives instead of giving cash bonus, most of which goes in the form of taxes. The textile organisation, which already sends quite a few managers for technical training, is also to develop its executives through out-country executive development effort.

142

EXECUTIVE DEVELOPMENT

There is no doubt that this is a very important method of executive development. The interaction, cross-country and cross cultural experiences are a very stimulating learning process. It also helps executives to keep upto date with some of the latest developments in their industry and in the management and organisation of that industry. Out-country Effort of Foreign Subsidiaries

The aluminium organisations in our sample makes no secret of the fact that the major effort as well as the most effective executive development effort is through the management development school of its parent company in Switzerland. An important segment of the programme at the parent company school is a field trip or observation tour. Here the programme provides an opportunity to the participants to visit 25 industries in Europe to study management in action. Each class is divided into 5 groups of 5 each and after going through the varied industries, they will study one industry in depth and observe management in action in depth. Out of the year long course at the parent company in Geneva, about three and half months are devoted to the field trip. Conferences with chief executives, directors and department managers are held in the board room with a view to finding out how they solve their problems. There is intensive questioning and probing in these sessions. The typical enquiries are: "What is the most important problem of today in the company and industry? How is it solved? What styles of management are applied? How do you motivate the employees?" A series of questions on finance, human relations, production, marketing etc. are asked and answers sought. After this every group has to prepare a report giving objectives, policies, functions, operations, organisation and management, performance in relation to the targets 111 the industry. The company feels that this is one of the most effective methods of executive development. So far 61 of their executives have attended the year long management courses. The company feels that this is the most effective executive development effort. The Assistant General Manager of the oil organisations states: "A further organisational advantage which comes from such exposures is the opportunity it provides for cross-fertilisation. We also implement this concept of cross-fertilisation by sending our people abroad not merely on training or observation assignments but specifically to do a job of work and similarly we bring people from abroad into India. This of course is one of the advantages we do enjoy as an international company and I can assure you that we take the fullest advantage of it." The Chairman of the cosmetics organisation explains: "The parent company's training facilities in the United Kingdom and its specialist course in Australia and America, are also open to us. We have also sent men to Henley and Harvard. Lastly, we send a few men every year to the United Kingdom for specialised training with the parent companies in that country and on the continent."

STRATEGY OF EXECUTIVE DEVELOPMENT

143

In the case of the rubber organisation, more than 50 executives have attended programmes organised by the parent company in the United Kingdom. Every director on leave has to attend an executive development programme at the shell centre. The tobacco organisation sends its executives to UK, Europe and USA to attend executive development programmes and about 9 executives go abroad every year. The chemicals organisation deputes executives to programmes abroad by the paret company and other agencies. It also provides on-the-job development experience to its executives in the subsidiaries of the parent company all over the world and this is considered to be one of the most effective methods. The foreign controlled companies have a decided advantage in utilising this strategy of executive development. Out-country Effort of Indian Companies The four companies are textiles, cement, steel and engineering organisations. In the textiles, every year some five executives are sent abroad to attend executive development programmes in UK, Europe and USA. On a special project, many executives may go abroad for training. The cement organisation indicates that it has begun to send executives abroad for the specific purpose of development and so far only one executive has had this privilege. The other two organisations (steel and engineering) do not depute executives to executive development courses and in fact the top personnel executive of the steel believes that it is not really necessary to send executives for executive development programmes. But these two organisations provide opportunities to their executives to participate in international conferences as a specific development method. Summing up, most of the 'sample organisations do use out-country executive development facilities and programmes and only thing is that, perhaps there may be a need to use these facilities as extensively and systematically as it is done in the case of technical training, particularly in the Indian organisations in our sample. This strategy would reduce our dependence on foreign personnel, knowhow and management. These are the various strategies used by the sample organisations and the policy of a judicious mixture of these strategies by the sample organisations is a sound policy and strategy of executive development.

REFERENCES 1

2

We must also quote here the response of a top executive of the public sector (quoted in my book, Executive Development in India: State of Art in Public Secotr): "Please tell me why are they charging such exhorbitant fees for these courses in a poor country like ours. I feel it is uncalled for. I believe what is needed is proper financial management on their part, before they teach us management. I tell you, professor, it is easy to teach management butpratising it is something else. I would like to see them more cost-and-price conscious than they are at the moment." See M.N. Rudrabasavaraj, Executive Development - A Model and A Point of View, (Calcutta; Indian Institute of Personnel Management, 1971).

DOD

11 EXECUTIVE TRAINING AND DEVELOPMENT TECHNIQUES Research, experimentation, testing and experience have yielded a great variety of training techniques and pedological methods which are used in executive development programmes. Increasingly the emphasis is on student-centred learning process, where the active commitment and involvement of the participant is sought to be promoted. We asked the sample organisations what sort of training techniques they used in their in-company programmes and to which their executives were exposed in outcompany programmes. The response is summarised and shown in the Table 11.1 below: It is clear that the sample organisations do use a great variety of pedological approaches and techniques and most of them use more than a dozen techniques, depending on the objective of the programme, participants and their status, time, and the problem.

Case method, sensitivity training, lectures, business games, conferences, seminars, workshops, role play, and audiovisuals are used by all the sample organisations.

EXECUTIVE TRAINING AND DEVELOPMENT TECHNIQUES

145

Save one, engineering organisation, all the respondents use syndicate methods, executive speaking and visits abroad. Next in popularity are executive writing (all except engineering and textiles), executive exercises and management grid (10 or all except engineering and cosmet.ics), Brainstorming (8) sessions are used by all except engineering, rubber, steel and engineering; book reviews (8) by all except engineering, textiles, rubber and cosmetics; simulation (8) by all save engineering, textiles, rubber and cement, quantitative methods (8) by all except engineering, rubber, tobacco, cement; project report (7) by all except 2 engineering, aluminium, cement and chemicals. TABLE 11.1 EXECUTIVE TRAINING AND DEVELOPMENT TECHNIQUES IN PRIVATE SECTOR

Sr.No.

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12.

Techniques Case method

Number

Per cent

12

100

Syndicate method

11

92

Lecture method Sensitivity training

12 12 12 12 12 12 12 6

100 100 100 100 100 100 100 50 92 83 100 50 83 83 67 67 67 67 83 50 8 50 58 25 25 92 100

Business games Conferences Seminars Workshops Symposia Executive listening Executive speaking Executive writing

13.

Roleplay

14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29.

Incident process Executive exercises Management grid Brainstorming sessions Book reviews Simulation Quantitative methods Observation tours Counselling and guidance Correspondence courses In-basket Project reports PRIME Research Visit abroad Audio-visuals

11

10 12 6 10 10 8 8 8 8 10 6 1 6 77 3 3 11

12

146

EXECUTIVE DEVELOPMENT

Executive listening (6) is used in textiles, aluminium, steel, engineering, cement and cosmetics; incident process (6) in 2 engineering, 2 textiles, steel and chemicals; and counselling and guidance (6) in textiles, rubber, tobacco, cosmetics, oil and chemicals; PRIME in only 3 organisations, textiles, steel and engineering; Research in only 3 organisations, 2 textiles and rubber. Only one organisation uses correspondence courses and that is a textiles organisation. Most Effective Techniques

We further asked the respondents about the effectiveness of the techniques and we also wanted to know 3 or 4 techniques which were found to be most effective and useful. Case method, syndicates and lectures are found to be most effective by 4 organisations (steel, engineering, cement and textiles); case method, sensitivity training, and business games by the engineering organisation; case method, lectures, roleplay , by the textiles; case method, syndicates and visits abroad by the Cosmetics organisation; case method, business games and visits abroad by the oil organisation; case method, sensitivity training and visits abroad by the chemicals organisation. From the response, the case method is not only the most widely used teaching medium but also the most effective in the opinion of our respondents. Next in popularity and effectiveness are lecture method and syndicate method. The top personnel executive of one of our respondents observes that the lecture method using the gUIded discussion or the Socratic method is still the best. Although the respondents use more than a dozen pedological media out of an available thirty different media of training and development, case method, syndicate method and lecture method are the most popular and effective with our respondent organisations.

DOD

12 EXECUTIVE DEVELOPMENT SUPPORT SYSTEMS No executive development effort can be very effective unless it is aided by proper support systems. There are a great many developments in the training technology since the chalk and black board days and we have a number of training aids and support systems. We asked the sample organisations about the kind of training aids used by them. The response is shown in the Table 12.1 below. TABLE 12.1 EXECUTIVE DEVELOPMENT AIDS IN PRIV ATE SECTOR

Sr.No. l.

2. 3.

4. 5. 6. 7. 8.

9. 10.

Aids

Company sponsored centre Residential facilities Films, slides, projectors, movies and stills Graphs, charts, flash cards, flannel boards Pamphlets, brochures, manuals Library and reading rooms Exhibits, posters and displays Notice boards, bulletin boards and drawings Cartoons, comic books Stationery

Number

6 8

12 12 12 12 11

12 2 12

IJer cent

50 67 100 100 100 100 92 100 17 100

148

EXECUTIVE DEVELOPMENT

Some 6 organisations (aluminium, tobacco, steel, engineering, cosmetics and chemicals) have established their own management training and development centres where in-company programmes are organised. The other 50% of the sample organisations do not have their own premises but use out-company premises for the conduct of their programmes. The oil, cement, textiles, engineering organisations have their own training halls or conference rooms set aside for the sole purpose of in-company training programmes. The rubber organisation uses the centre of another organisation (tobacco) covered in our study. The other textiles organisation mostly hires conference room facilities in the top hotels to conduct their in-company programmes. In addition, it also uses the conference rooms available in its units. All the management development centres available with 6 organisations have residential facilities accommodating anywhere from 15 to 50 participants. One organisation (rubber) has a hostel to accommodate about 33 management trainees in single rooms. Films, slides, projectors, movies, stills, graphs, charts, flash cards, flannel boards, pamphlets, brochures, exhibits, posters, displays, notice boards, bulletin boards, stationery, library and reading rooms are the various support systems provided by all the sample organisations. The steel organisation has developed a good film library of more than 70 films, which is very classified and very extensively used by the organisation. Another organisation (engineering) also has a small library of films which is used very extensively. The other organisations borrow films from various sources such as AlMA, NPC, USIS. British Council etc. Although the sample organisations have libraries and reading rooms, our impression is that there is not much of an effort to organise good libraries, which are extensively used by the executives. Giving information on this aspect, the number of books in the libraries of the sample organisation range anywhere from 1,500 to 5,000 and while this is commendable, this is not certainly commensurate with the needs and the size of the respondent organisations. This is certainly a very weak area really a great effort is necessary to not only build large and useful libraries but also persuade the executives to use them extensively by developing their own strategies of selfeducation and self-development. We must also observe that there is a communications revolution going on in the advanced industrialised countries where the medium is the message, in the words of the high-priest of communications revolution, Marshal McLuhan. Computers, closedcircuit J:V, cassette programmes, videO-Cassette programmes, micro-film, videotaperecorders are yet to reach and make an impact in the sample organisation. Perhaps these also will come and create a big impact on human resources development in the near future. The most recent dramatic impact of the SITE in villages in imparting education and influencing human behaviour action and attitudes is a case in point.

000

13 EXECUTIVE DEVELOPMENT FACILITIES There is also a variety of other facilities provided to the executives for training and development effort. These facilities help create the right frame of mind and reference and show the commitment and interest of the company in the development of executives. We asked the respondent organisations about various types of facilities provided to the executives for the purpose of training and development. The response is shown in the Table 13.1. Facilities such as course or tuition fees, hotel expenses, travel, transport, time-off, leave facilities and participation in conferences, seminars, symposia organised by professional associations are provided by all the sample organisations. Although, strictly speaking, there is no books allowance as such, there are certain variations of the same in spirit, in that books can be obtained by the executives. The organisations providing this facility are 7 in number (58%) and they are engineering, textiles, rubber, aluminium, tobacco, cosmetics and oil organisations. In the engineering and cosmetics organisation, every department has a budget for books and books are bought and made available. In the tobacco, rubber and aluminium organisations, recommended books are provided by the companies as course material. There is an Education Refund Plan upto Rs. 500 per year for the executive, which makes provision for books in the oil organisation.

150

EXECUTIVE DEVELOPMENT TABLE 13.1 EXECUTIVE DEVELOPMENT FACILITIES IN PRIVATE SECTOR

Sr.No.

Facilities

Nllmber

Per cent

1.

Fees (admission and tuition) Hotel expenses Travel Transport Books allowance Time-off Leave facilities Subscription allowance for obtaining management journals, periodicals etc. Membership for professional associations Participation in conferences, seminars etc. Extra allowances

12

100 100 100 100

2. 3. 4.

5.

6. 7. 8. 9.

10. 11.

12 12 12 7 12 12 2 8

12 8

58

100 100 17 67 100 67

When we asked this question, a hi>p personnel executive of one of the sample organisations reacted sharply: "Shall the company pay for this also? Or shouldn't the executive take care of this? This should be done by the individual." Membership fees for professional associations are provided in 8 organisatipns (67%) textiles, rubber, aluminium, tobacco, cement, cosmetics, oil and chemicals. Some sort of extra allow,\nces are provided to the executives on out-company programmes by 8 organisations (67%). Giving information on this aspect, the rubber organisation gives an allowance of RS.15 per day and Rs.lO per day to senior and junior executives respectively. The tobacco organisation pays Rs.22 per day as out of pocket allowances. In 4 other organisations (aluminium, cement, chemicals and textiles) the executives, who are entitled to entertainment allowances, are provided some extra allowances also. In the oil organisation, it depends on the status of the individual in the organisational hierarchy. As for the subscription allowance for obtaining management journals and periodicals provided by only 2 organisations (textiles and steel), the steel organisation buys about 200 copies of Indian Management and they are given to the executives. The textile organisation buys subscriptions of certain journals to certain executives. This is a sound and commendable policy. The sample organisations do provide a'variety of facilities for the training and development of executives.

DOD

14 EXECUTIVE DEVELOPMENT FACULTY Who are the faculty members in executive development programmes of the sample organisations? The following constitute the faculty in the executive development programmes: TABLE 14.1 EXECUTIVE DEVELOPMENT FACULTY IN PRIV ATE SECTOR

Sr.No.

Faculty

Nllmber

Percent

1.

Full Time Training Instructor

12

2.

Part Time Training Instructor

3.

Line Executives

2 12

4.

Personnel and Staff Executives

12

5.

Top Executives

11

100 17 100 100 92

6.

Management Consultants

7.

Institutes of Management Faculty

8.

100 100

University Professors

7 12 12

9. 10.

Members of Professional Associations

11

92

Foreigners

11

92

11.

Other Companies

10

83

58

152

EXECUTIVE DEVELOPMENT

All the sample organisations have full time trainers ranging from 1 to 6 and only 2 organisations (textiles and rubber) have some part time trainers in addition. But we must say that this is a small nucleus supplemented enormously by line and staff executives of the organisation. Increasingly there is a trend in involving line and top executives, in addition to staff executives, in training and development programmes. People pay lot more attention to their own bosses and the fact that their own boss takes the trouble of preparing and teaching has a dramatic effect on the participants. Giving data on this aspect, the top personnel executive of a textiles organisation in our sample observed: "We draw heavily from our professional management talent. In the 24 programmes organised last year, we used about 122 faculty out of which only 30 were outside faculty, mostly drawn from the institutes of management, university professors, and NPC and the rest were all from our group. Usually the theoretical and conceptual aspects are covered by professors and the practical aspects by our line, top and staff executives. Some of our programmes are completely conducted by our own top and line executives. We believe this faculty mix is most effective as well as relevant. It is also our policy not to invite executives from other companies to talk to our executives and we do not invite them to talk to our groups." All the sample organisations use line and staff executives and also top executives, quite in consonance with the global pattern and trend. Professors from the universities and management schools are universally popular with all the sample organisations and this is a very sound policy. Next in wide usage are members of professional associations and foreign consultants and professors. Executives from other companies to share their views and experiences with their own executives is a very good practice and this promotes considerable learning. Management consultants do not seem to be that popular with our sample organisations and only 6 organisations (50%) use them as faculty and the organisations are 2 engineering, textiles, aluminium, steel, and cement organisations. Although the sample organisations use a wide variety of sources to draw their faculty from, this seems to be a weak area in that none of the top and leading organisations seem to have thought it fit to have competent and adequate complement of full time trainers. This is a grave lacuna. The pattern of involving line and top executives in training and development effort is a very commendable one. Exposure of the executives to researchers, professors and experts in the programmes is another very good thing. Anyone who stimulates a company executive to think afresh and anew to find a better method, policy or procedure than the current one would have done a great service to the executive development effort. Compensation for Faculty We also asked what is the salary range of the permanent full time training experts and instructors. A good measure of the value and importance attached to this function of training and development is the level of compensation. Some 7 organisations gave information on this area and it is shown in the Table 142 : The tobacco organisation indicates that the training Manager gets the salary that any other department head gets at the head office or the units and that is fairly high. The other 4 organisations did not provide the data on this aspect. The compensation shown above in the table does not include all the various allowances and perquisites. While at the lower end of the scale given to junior and fresh training officers may be somewhat adequate, the maximum going rate of com-

EXECUTIVE DEVELOPMENT FACULTY

153

pensation seems to be barely attractive only in 3 organisations (textiles, steel and engineering) . TABLE 14.2 COMPENSATION FOR TRAINING AND DEVELOPMENT EXECUl IVES IN PRIVATE SECTOR

Range Sr.No.

Organisations

Minimllm Rs.

Maximllm Rs.

l.

Engineering

800

3,000

2.

Textiles

2,000

5,000

3.

Rubber

800

3,000

4.

Steel

700

5,000

5.

Engineering

700

5,000

6.

Cement

1,000

2,000

7.

Textiles

1,000

3,000

In the other four organisations, it is not at all attractive and this will turn out to be a big constraint. We must venture to add that, particularly in view of the crucial importance of executive development and introducing professional management in Indian Industry, there is need to review the compensation structure in order to attract the very best of professional expertise in the area of training and development. The sound and competent training and development expertise must be attracted and given all the freedom and facilities to develop executive leadership. Only then we shall ensure competent professional management for the private sector. Remuneration to Guest Faculty

All the sample organisations have the policy of compensating the guest faculty drawn from university professors, management institute faculty, management consultants, other company executives, members of professional institutes and association and foreigners. The practices vary considerably. An organisation may fix the remuneration by negotiation. The compensation is correlated to the status, competence, prestige and fame of the guest faculty member and the organisation may pay different compensation to different people. Another practice is to pay a flat rate for a session, regardless of the individuals involved. Another policy is to pay by the hour or the day and more the number of hours, higher is the compensation. Another policy may fix a range within which the guest faculty is compensated. Another policy is to pay nothing, which of course is not the policy in any of our sample organisations. Another policy may be to pay the highest compensation possible in order to attract very competent guest "faculty. In some situations, the guest faculty may determine what the organisation will pay. While some may have a policy of compensating their own executives when they conduct some sessions, the sample organisations do not believe in this sort of policy since it is considered that training and development is a part of the regular responsibility of their executives. The response of the sample organisations on this question is shown in the Table 14.3.

154

EXECUTIVE DEVELOPMENT

Except in three organisations (textiles, steel and engineering, the sample organisations do have a policy of providing a fair compensation and in rubber, cosmetics, oil and chemicals organisations, it is rather good and it should attract very competent faculty. In addition to this, all the sample organisations defray the travel, transport, hotel expenses of the guest faculty. TABLE 14.3 REMUNERATION FOR GUEST FACULTY IN PRIVATE SECTOR

Range Sr.No.

Organisations

Millimllm Rs.

Maximllm Rs.

I.

Engineering

200

300

2.

Textiles

50

by negotiation

3.

Rubber

200

1,500 (per day)

4.

Aluminium

200

250

5.

Tobacco

150

by negotiation

6.

Steel

75

by negotia tion

7.

Engineering

75

by negotiation

8.

Cement

100

100

9.

Cosmetics

300 (per day) by negotiation

Oil

150

500

150

500

100

250

10. II. 12.

. Chemicals Textiles

The engineering organisation pays Rs.200 to Rs.300 per session. The textiles organisation pays Rs.50 per lecture as incidental expenses. In some cases, it pays the actuals inclusive of travel, hotel and fees, whatever that may be. The rubber pays Rs.200 to Rs.350 per session. However, generally the remuneration is around Rs.200Rs.250 per lecture. The tobacco pays Rs.150 per lecture and is also prepared to pay according to the wishes of the guest faculty. The steel and engineering pays Rs.75 per lecture and more by negotiation. The cement pays a flat rate of Rs.I00 per session. The cosmetics pays Rs.300 per day and more by negotiation. The oil pays Rs.I00 per lecture and Rs.300 per day. The chemicals pays Rs.150 per session and Rs.500 per day. The textiles pays a flat rate of Rs.I00 per session. However, it pays also the actuals, inclusive of travel, hotel and fees charged by the guest faculty, whatever that my be. We must commend the policy of remunerating the guest faculty in a suitable manner in the sample organisations and this ensures the services of competent guest faculty. This is a sound policy.

DOD

15 UTILISATION OF TRAINED EXECUTIVES Utilisation of Trained Executives

In the systems approach to executive development, the follow up and utilisation of trained executives is a very crucial phase of the executive development system. An executive is deputed for a programme and he participates in the programme. He returns to his job. But this is not the end of the executive development effort. As a matter of fact, this is just the beginning, in the sense, at this stage of the game the problem of transference of learning to on-the-job situation arises. If the goal of training and development is to further the goals of the organisation as well as the individual, then learning or training that does not transfer to the job is of no use. The sample organisations realise this and report that they provide all opportunities to their executives to utilise their learning on-the-job in the organisation. However, some organisations do indicate that there is no planned, systematic, concentrated effort in the area of utilisation, although they also provide opportunities for the executives who attempt to utilise their new learning on their jobs. But they would not chase after them, as one top executive put it. The general pattern is to provide all opportunities for the utilisation of the new learning on the job. However, the sample organisations feel that there is room for improvement in this department. The general complaint is that not all the executives, who return from a programme, are striving to

156

EXECUTIVE DEVELOPMENT

use their new learning on the job, although the. organisational environment and climate are supportive enough for this effort. This is a weak area in most of the sample organisations. Perhaps, there is a need for greater systematic and concentrated effort in this area of utilisation of trained executives. One of the cardinal principles of learning is that it is reinforced by application and practice. Without that opportunity we would not derive the full benefit of training and development. After all, human memory is short and deceptive. It may be of interest to note the study of Dr. Kamala Chowdhry where she interviewed 29 executives at a university management development programme often use the training to escape from the stresses of the job and to plan the next phase of their career strategy, rather than for the purpose for which the training was intended. 1 There is no need to belabour this issue. There is need for the sample organisations to focus their attention and effort on the problem of utilisation of trained executives, if they want to derive the maximum benefit from the executive development effort.

REFERENCE 1.

Kamala Chowdhry, "Management Development Executives", Hllman Organisation, 1964, pp. 224-29.

Programmes:

Moratorium

for

000

16 EVALUATION OF EXECUTIVE DEVELOPMENT What is the cost-benefit analysis (CBA) is the crucial question in the area of the evaluation of executive development effort. All this effort on executive training and development costs a good deal of money and it is only natural to ask what is the pay-off. What is the return or the rate of return on investment? How do the sample organisations evaluate the impact of the effectiveness of training and development? What are the techniques of evaluation used? Do they use tests? Do they use check-lists? Do they use control groups and experimental designs? What criteria are used for the purpose of evaluation of executive development programme? Has it been possible to quantify the benefits of the executive development? Has it resulted in increased output? Has it reduced the time to turn out unit of production? Has it resulted in the reduction of costs, scrap, waste, breakage or supplies used? Has it resulted in the improvement of morale? Has it contributed to the reduction in absenteeism, grievances, turnover and expenses? Has it reduced training time? Has it achieved the objectives it set out to achieve? We asked the sample organisations all these questions. Evaluation of the impact of training and development can be at different levels. First, it may be at the level of endorsement. That is to find out whether he endorses or likes the programme. Has the programme been effective? Is there a proper coverage of the subject? Are the physical facilities adequate and appropriate? Is the atmosphere conducive to learning? At this level, the endorsement is evaluated through a course evaluation or programme appraisal questionnaire, which is given at the end of the programme.

158

EXECUTIVE DEVELOPMENT

Secondly, it is at the level of learning. In an executive development programme we are providing an opportunity to the executive to learn some new concepts or techniques or tools of management. Or they may be exposed to some new skills. We want to see whether he is learning the new concepts, tools and techniques. Whether he has learnt or not can be found out through tests, quiz or examinations. Thirdly, it may be at the level of results and performance, which is perhaps crucial. Has training and development resulted in better performance and results? Has it changed behaviour, attitudes, skills and roles which ultimately have an impact on results and performance. This can be analysed and found out through attitude surveys, cost accounting, performance appraisals, control groups and experimental designs, analysis of costs, waste, scrap, productivity and profits and close follow up. In our study, there is some sort of evaluation of the impact of training and development at the first level- the level of endorsement - in all the sample organisations. On the other two more crucial levels -learning and results-there is not much of an evaluation effort, except in 4 organisations (2 textiles, chemicals, rubber). The considerable effort in terms of planning, organising and administering incompany executive development programmes is usually not followed up with a similar effort at evaluation of executive development. A great deal of effort goes in the organisation of a programme but no similar effort seems to be forthcoming in the evaluation of the impact of executive development programmes. This is perhaps the most crucial weakness of the executive development system of the sample organisations. Both in the case of in-company and out-company training and development programmes, there is some sort of evaluation at the first level-level of endorsement. All the sample organisations have a course evaluation or programme appraisal questionnaire filled in at the end of the programme by the participants. In the course evaluation, the participant gives his reaction to the programme and what he thought of the objectives, administration, coverage and effectiveness of the programme, training methodology and effectiveness, faculty, physical facilities, food and timings etc. In addition he is asked to state what he gained from the programme and what recommendations or suggestions he has for implementation in the organisation. Some 3 organisations (aluminium, tobacco and cosmetics) require their participating executives to send in detailed course evaluation reports talking about the course content and coverage, value of the course, his recommendations, further utilisation of the course by others in the company. If there are any worthwhile suggestions, they are followed up to see if they can be implemented. But most of the time these reports deal only with the assessment of the course only. However, there are some other practices in order to have some sort of evaluation of executive development. In some 5 organisations (2 textiles, steel, cement, engineering) the participant executive is asked to give a talk on the subject of his training programme and thus share his new learning with the company staff. Another organisation (textiles) has the practice of having briefing and debriefing sessions with the participant executives by the top executive and development executive. Before the executive leaves for a programme, he is told why he is being sent, what he should look for, what are the things he must learn, how he should plan to use some of his new learning on the job after his return. After he returns from the programme, he is asked about what he thought of the programme, what he learnt, what he proposed to do and how he proposed to implement some of the things he learnt.

EVALUATION OF EXECUTIVE DEVELOPMENT

159

Let us take a closer look at the responses of the each of the sample organisations on this vital area of evaluation of the impact of training and development. (1) Textiles Organisation

In this organisation, the in-company programmes are evaluated at the first level-level of endorsement. In the programmes for the management trainees, there are project assignments, where the trainees study the problem and prepare project reports with a set of their recommendations. If the recommendations are sound, opportunities for implementation are provided. The project assignments are believed to be extremely valuable vehicles of learning and development for the trainees. Some of the trainees are reported to have done some excellent projects, which are implemented. In the case of the out-company programmes, there are briefing sessions and debriefing sessions after the programme. The participant is required to send his course evaluation and also a detailed report on the programme, its utility and his recommendations for transference of learning on to the job. The participant also is expected to give a talk on the programme and thus share his learning in the company. However, there is no attempt at a cost-benefit analysis and quantification of the benefits accruing to the organisation as a result of the investment in the executive .development effort. (2) Engineering Organisation

Course evaluation is done through a questionnaire in the case of both in-company and out-company programmes. This gives the necessary feedback on the value, utility and success of the programme. The training executive explains the evaluation programme of the company in a note and we quote: "Our purpose in setting up a programme of evaluation of our Training Programmes was motivated with two objectives: (1) To improve future programmes and to eliminate those programmes or aspects of the programme that are ineffective. (2) To be prepared for the evaluation of the entire Training Programmes before the day of reckoning arises. In seeking to meet these two objectives, we were confronted with the arriving at the definition of evaluation, which everyone would agree, would be, "to determine the effectiveness of a Training Programme." But we found that this had little meaning until we answer the question, "In terms of what"? We therefore decided to move from complicated elusive generalities into clear and achievable goals which we broke down into four steps as under: Step No.1 : Reaction. - How well did the participants like the programme? Step No.2: Learning. - What principal facts and techniques were learnt? Step No.3: Behaviour. - What changes in job behaviour resulted from the programme? Step No.4: Results. - What were the tangible results of the programme in terms of improved quality, improved quantity, reduced costs, etc.? This paper attempts to report our progress in the first two steps. In our attempts to arrive at the answers in Steps 3 and 4, we have set up a Research

EXECUTIVE DEVELOPMENT

160

Design that would answer the questions over a period of time. In the two Junior Management Development Programmes for our Senior Shop Personnel, the participants were administered Dr. Bernard Bass's Exercise Attitudes half-way through the Programme. The scores of Exercise Evaluation are given at the end of the programme. The shift in the score was significant at 05 level. In the same Foreman Development Programme the participants also rated the programme on the following four dimensions: (1) The extent of usefulness of information. (.2) The interest of the programme. (3) The competence of Instructor. (4) Training methods employed.

71 % of the participants gave very strong positive rating regarding the practical information gained from the course, followed by 29% who also agreed that they derived a good deal of practical information. There were no negative responses. In relation to the interest of the programme, 76% indicated complete agreement and 24% indicated partial agreement. There was no disagreement or negative response. In relation to the competence of the instructor, 88%, gave a very positive response followed by 12% indicating a favourable response. There was no negative response. In relation to the training methods employed the percentages were as follows: "This seemed like a sensible way to run a course to promote learning in this area."

r

Completely Agree Partly Agree Neither Agree nor Disagree

76%

Partly Disagree Completely Disagree

12%

6% 6%

In a programme on Managerial Communications for a Planning Unit four dimensions were evaluated as under: (1) The extent of usefulness of information given during the workshop. (2) The interest of programme. (3)

Competence of the instructor.

(4) Training methods employed.

(1) A cent per cent positive rating was given to the question, "I learnt a good deal of practical information from this course." This was spread over two ratings, viz., Completely Agree (57%) and Partly Agree (43%). To another question frame~ in the negative but designed to measure the amount of usefulness of the course, there was cent per cent disagreement in relation to the questions, "I do not see how we learned anything of much use from this course". The rating was completely disagree-100%. (2) A programme is effective to the extent it can sustain the interest of the participants right through the end. Cent per cent disagreement was given to the negative question, "This proved to be just another dull course." This was spread over - Completely Disagree (86%) and Partly Disagree (14%).

EVALUATION OF EXECUTIVE DEVELOPMENT

161

(3) Every programme must provide for feedback mechanism to the Instructor, so as to help him remonitor his future programmes. A cent per cent disagreement was given to the rating, "The Instructor gave me the impression that he did not know as much as he should about what he was doing." The rating was Completely Disagree - (100%). (4) It is necessary to evaluate the methods employed in presenting the subjects in relation to the type and level of participants. A high rating was given to the question, "This seemed like a sensible way to run a course to promote learning in this area." The rating was spread over - Completely Agree (50%), Partly Agree (43%) and Neither Agree - nor Disagree (7%). In our attempts at the evaluation of the Training Programmes mentioned in Step II, we administered Dr. Donald Kirkpatrick's questionnaire on Supervisory Inventory on Human Relations before the commencement of the Junior Management Development Programme for shop personnel. The same test administered at the end of the programme. A point may be mentioned here that the material presented in the course was covered by the test or inventory items mentioned. The shift of the scores on the Inventory (preprogramme vs. post programme) was found to be significant at .01 level. This means th.tt less than one time in 100 would the Mean Gain of scores obtained after the Training Programme occur as a result of pure chance. Other attempts at devising suitable questionnaire to measure learning behaviour are being worked out and would be administered before the programme and after the programme. In the recently concluded programme for the Managers of one of our Sales Division, the following was the evaluation of the programme: (1) Information received in the programme will be of:

(2)

Great help

76%

Some help

18%

Little help

6%

The training sessions were: Very well presented

47%

Adequately presented

53%

Not adequately presented (3)

Were the primary objectives met? Yes

94%

No

6%

In another Communiciation Programme, we have administered the Freshley's Communication Attitude Scale. An alternative form of this questionnaire will be administered at the end of the programme. There is no systematic effort to elicit suggestions or recommendations with a view to implementing them and thus transfer learning on to the job. The company feels that there is no systematic evaluation of impact of the training and development programmes. This organisation has done some sort of cost analysis of the executive development effort. We quote its experience from its cost analysis reports:

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Cost Analysis

"To remain competitive, a modern business enterprise must ensure the cost-effectiveness of every aspect of its operations. "Training" cannot remain an exception. This is particularly so in view of the fact that training is gradually gaining acceptance as an important corporate function and resources are being committed to it in increasing measures. Unfortunately, there are not many companies who display adequate awareness of the importance of their training cost and often a great deal of money gets wasted in the name of training. It is this lack of cost-conciousness which contributes to the absence of evidence about the cost-benefit analysis of training and makes training activities the first casualty in many organisations in moments of financial difficulty. It is indeed true that the cost-benefit analysis of training is a difficult process. There are many problems in the measurement of effectiveness of training. Some good effects of training result in visible improvements in the short run, whereas others are relatively intangible and may become visible only in the long run. There are many methodological problems in designing a study of the impact of training. However, they are not as difficult to resolve as is often made out to be. Though the importance of analysis of training costs is readily agreed to, it is surprising that in training literature one does not find many reports of such analysis. Sometimes one wonders whether the reluctance to initiate studies about the measurement of training outcomes and cost-benefit analysis is not the result of the anxiety and lack of self-confidence on the part of the training personnel. Some of them seem scared about the possible findings of such studies. The first step in the cost-benefit analysis of training is obviously to develop a clear understanding of the costs. This article attempts such an understanding about organisation costs. In a subsequent article an attempt will be made to discuss the problems of measurement and cost-benefit analysis of training. This case study is being published with the hope that many more organisations would do the same to facilitate inter-firm comparisons and to help refine the analysis of costs and improve the quality of training. Organisation's Training Office

Organisation appointed its first Training Office in 1966. The Training Office of the company during the period 1-4-68 to 31-3-70 for which its expenses are analysed in this article had in addition to the Training Office, a staff of one stenographer and a typist. The company has a well equipped Training Centre with a good collection of training films. The list of programmes organised during the years 68-69 and 69-70 is given in Exhibit I. Though the Training Office helped to some extent by procuring educational material for the company's technical training and it was formally responsible for non-technical training only. The company's expense on Training Office during the financial years 68-69 and 69-70 was Rs.1,29,819 and Rs.1,02,607 respectively. This is .33% and .23% of the Company's expense on employee salaries, wages and benefits. The Company's management has been quite appreciative of the need for training of its employees and has liberally provided funds both for nominations for outside

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training programmes as well as for in-company programmes. The Company spent approximately Rs.38,OOO and Rs.48,OOO as fees alone during the years 1969-70 and 1970-71 respectively for nomination of its staff to outside programmes. There are of course other expenses like travelling, boarding and lodging, salaries of periods of absence of training etc., of which an estimate is not available. This article examines the nature of the Training Office costs, the cost-perunit in terms of programmes, trainee days, training days and how do the costs of one year compared with those of the previous one. The objective of this analysis is firstly, to determine how the existing data can be utilised in taking decisions regarding control of costs and better planning and budgeting for future programmes, and secondly to suggest improvements in the current system of collecting cost data so that a better use of them be made in future. Classification of Costs

Costs may be classified in different ways for different purposes. One of these classifications divides costs into the categories variable, fixed and semivariable. Variable Costs : These are costs which tend to vary in proportion with output or some measure of activity. In case of training Office, the programmes that it conduct~ may be considered the "measure of activity." Hence in this case, a cost incurred by Training Office could be considered 'variable' if it increases and decreases with changes in the number of programmes. Fixed Costs: These are costs which are not expected to change during the budget year, irrespective of fluctuations in the level of activity. Thus for the Training Office, a fixed cost would be one that remains whether the number of programmes conducted was two or twenty in a year. Semi-variable Costs: These are costs which consist of variable and fixed components, i.e., a cost, part of which, varies as the number of programmes, and the remainder of which is constant. Analysis of Costs

The costs incurred by the Training Office in the years under consideration are shown in Exhibit II. This has been compiled from the statements of the Company's Accounts Office. Certain anomalies immediately become apparent. The first is with regard to items 193 and 199. They represent "Books and Periodicals" and "Other Sundry Expenses" respectively. The expenditure on these items cannot be considered "Overhead" costs because they are used for the purchase of long lived assets: in the first case books; and the second, films. Thus these items should be (and have been in this report) classified as "Capital Expenditure." The second anomaly is with respect to item 231, 'Floor Space Charges' which is seen to form an appreciable part of the total cost. The allocation of this cost assumes that the large hall attached to Training Office is used solely by Training Office. This however is not the case. The hall (now split into an interview room and an auditorium) is being used frequently by other Departments also.

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The remainder of the items, with the exception of 191 and 204, can be classified with a fair degree of certainty as either fixed or variable costs. Item 191, 'Printing and Stationery' is a semi-variable expense. It comprises two parts: the costs incurred for printing and stationey used in the day-to-day working of Training Office and the costs involved in printing and stationery which is directly related to the programmes conducted. The first is fixed and the second variable cost. For lack of more detailed information, it is assumed that the total cost is made up of equal fixed and variable components. A similar assumption is made with regard to item 204, 'Travelling and Conveyance.' The half relating to the expenses of the Training Officer on tours regarding testing of candidates for selection for Graduate Engineer Trainee Scheme of the Company is considered fixed, while the half concerned with the transport of programme trainees, faculty etc., is considered variable. Strictly speaking the expense on testing tours does not concern the Training activity. However, in view of the small amount involved no adjustments have been made in cost evaluation. We now come to an interesting item "Pre-charged to departments." This is a credit item and represents the transfer of a part of Training Office's costs to other departments. For example, Training Office may incur an expense of Rs.1,OOO/- in connection with the supervision of Graduate Engineers of a Department of the Company. This will be spread over various items of cost such as Travelling and Conveyance, Printing and Stationery etc. However, this is a cost incurred by Training Office on behalf of another department. Therefore, Rs.1,OOO / - is subtracted from the gross costs of Training Office and is debited to the costs of that Department. Since it is not possible to estimate how much of these 'pre-charges' are involved in each of the cost items a problem arises in finding the net Variable and Fixed Cost (V.e. & F.e.) What we have done regarding this is as follows: First, the gross F.e. and the gross V.e. have been found. Then, in the ratio that each of these bears to total cost, the charges to other departments have been divided into two parts. These parts have then been subtracted from the gross figures to get the net V.e. and F.e. The assumption made here is that the relationships between the fixed and variable parts of the cost incurred by Training Office on behalf of other departments is the same as that of its own cost. Interpretation of Results

(1) Limitations of Analysis

In interpreting the results of this analysis, the following important limitations should be borne in mind: (a) It has not been possible to accumulate costs programme-wise. Thus the estimation of per-unit costs (variable cost per trainee day, total cost per training-day etc.) assumes that costs are independent of the nature of the programme. To the extent that this is not the case in actuality, the results must be viewed as not accurate. We have now started calculating the costs of every programme by using a cost sheet of the type shown in Exhibit III. (b) Weare forced to judge one year's training costs by comparing those with the previous year. This is not entirely meaningful as avoidable expenses may be

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reflected in a prior year's costs. We hope that inter-company comparison of training costs will help develop some cost norms. (c) The analysis does not cover all kinds of costs connected with the training. The cost figures may therefore, be underestimates of the real costs. For instance, the time devoted to the training programmes by the company's managers as faculty has not been costed. Also the time of the participants of the programme has not been costed. The travelling and other incidental expenses incurred by the outstation programme participants have also not been taken into account because of the difficulty in getting the relevant information. It may, however, be mentioned that the number of outstation programme participants during the period for which costs have been analysed was small. .

(2) Significant Observations

The following are some significant observations in the analysis of costs: (a) Fixed Costs: The Gross Fixed Costs in '69-'70 has increased by Rs.8,099/-. This is mainly due to the increase in three items - salaries, medical expenses and travelling and conveyance. Of these the first two are not 'controllable' costs. Travelling and conveyance is controllable to a limited extent. It seems that the increase in items of fixed cost are mostly unavoidable. Several items of fixed cost show a decrease. However, these are mainly allocated costs, e.g., depreciation of vehicles, depreciation of office and shop equipment, floor space charges, interest on fixed assets etc. The net fixed cost has decreased. This is because of a very great increase in 'charges to other departments.' (b) Variable Costs: Gross variable costs have increased in 1969-'70. This is only to be expected, considering that the number of programmes increased by 50% in '69-'70. It must, however, be noted that eacl;1. of the items of Variable Cost has not increased by 50% (as it should have). The disproportionate changes in items of variable cost may be attributable to the changes in the type of programmes conducted. (c) Relationship between Fixed and Variable Costs: The variable costs are a small percentage of the total costs (about 9% in 1968-69 and 13% in 1969-70). This suggests that either there is an under-utilisation of resources or there are avoidable heavy overheads. Considering the fact that the number of days on which training programmes were organised were only 29 in '68-'69 and 46 in '69-'70, the first explanation seems more reasonable. In other words, additional training programmes and training days could be organised with only small increases in total costs. The total cost per participant per training day works out to be about Rs.1S0 in '68-'69 and Rs.100 in '69-'70. The reduction in cost in '69-'70 due to increase in number of training days and programmes participated indicates that scope for cost reduction (per unit of training) is considerable. One also needs to consider whether some kinds of training cannot be obtained at lesser cost through outside programmes. We are familiar with the concept of 'make or buy' decision in Production Management. The concept has equal relevance to training function and we need to set up explicit criteria for deciding whether a particular kind of training should be organised on an intra-company basis or not. This is not to suggest that non-financial considera-

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tion like the relevance of content of training to the company's needs, the relative advantages of cross-fertilisation of ideas and exchange of experiences between personnel form various companies Vs various functions, locations within the company etc., are not important. What is intended to be emphasised is that cost of comparable intra-company Vs outside programmes should also be explicitly considered in training decisions." However, there is no cost-benefit analysis and also quantification of the return on the investment. (3) Rubber Organisation Both in the case of in-company and out-company pr..ogt Pre-employment Physical. (g) Selection and Placement. (11) Induction. (i) Follow up.

(a) Preliminary Interview: Is a good opportunity to establish rapport with the prospective officer. Don't oversell or undersell the job, just be specific and helpful in answering the candidate's questions. Give him all the details regarding the position, salary, allowances, facilities etc. so that he gets the clear picture. If the candidate is suitable and willing, give him an application blank. (b) Application Form: Generally the companies use application forms, but they may use weighted application forms. By careful study, such items are age, education, dependents, earnings and years on previous jobs may be found to be closely correlated with success in the position for which the candidate is applying. On the basis of past experience, a scoring system may be prepared for all such items and a clItting score may be established for the total. Such a weighted application form may quicken the process of screening and recruitment. For example, in one company six biographical items have been identified as "knock out factors" in a preliminary screening programme for salesman. They include instability of residence, failure in business within two years, divorce or separation within two years, excessive personal indebtedness, too high a standard of living, and unexplained gaps in the employment record. Computerised processing of the applications helps to hasten the screening. Apart from providing information on the applicant, the applications provide a starting point for interviews, the basis for reference checking and also testing. Seldom should applications be the sale criteria for selecting and seldom they are.

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(c) References: Check employment references, after obtaining the consent of the candidate and personal reference, and if necessary, school references also. But do not place much emphasis on this. (d) Interviews: Interviewing is the most universally used tool in any selection procedure and interviews are designed to serve in the important areas of employment, training, human relations, and labour relations. In many companies interview may be the only tool used. Interviews may be for a period of five minutes or for sixty minutes. Interviews may be informal and oral or they may be highly planned and carefully conducted. Invitation for the interview: When a company invites an applicant for an interview at the head office or the plant, some companies meet his travel expenses and some do not. Some meet the applicant's staying expenses also. Executives may be paid first class or air fare. Whereas blue collar employees may be given second class fare. According to the type and status, employee's expenses will be met. Then there are many companies that do not defray any expense incurred by the applicant appearing for the interview. Here the ability of the company to defray full or any part of the expenses of the applicant is crucial and its policy is important. The letter inviting the applicant to appear for the interview must be sent at least three to four weeks ahead of the time of interview, so that the applicant may plan his trip. The interview letter must also state the place of interview and time of interview. Place of Interview: The place of interview in the employment office must be neat, and good looking and it must create good impression on the applicants to sit and relax, while they wait for the interview. Magazines, newspapers, and company materials like the house organs, employee handbooks, company reports etc. may be also displayed for the applicants to browse through. Some companies serve coffee or tea to the candidates. Time of Interview : Generally all the candidates are asked to appear for the interview at the same time. For example, let us say a company invites 10 candidates for the interview and all of them are asked to report for the interview at 9 a.m. at the company office. Even if the interviewer or the interviewing committee or the selection board were to take ten minutes for each candidate the last of the 10 candidates will have to wait for more than 90 minutes. If the interview takes longer time, the candidate will have to wait for a longer period. Some companies meet this situation by staggering the interview time in such a way that no candidate will have to wait for more than five minutes. This will call for careful planning of interview time, but this will assist the candidates and also the interviewers. Some Interview Rules: Interview must be planned with care and the interviewers may observe some of the following rules: (1) Be courteous to the candidate and let him feel"at home." (2) Listen attentively and patiently. (3) Do not ask leading or tricky questions. (4) Never argue or interrupt or change the subject abruptly. (5) Ask questions in a simple language understandable to the applicant. (6) Be tactful in asking direct and personal questions. (7) Keep the candidate talking and encourage him to talk. (8) Try to get the relevant information.

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(9) Respect the interests of the candidate. Answer the candidate's questions. (11) Do not 'over sell' the job opportunities in the company. (12) Lead the interview to its conclusion.

(10)

Training for Interviewers: To observe all these rules, the interviewer must plan the interview and the questions he is going to ask, with particular care. Many companies train their interviewers in conducting interviews. The interviewers may be asked to beware of their first impressions, hasty inferences, bias, prejudice, likes and dislikes. Despite all the interview techniques, the personal observations and impressions of the interviewer are important in appraising the candidate and this element of subjectivity cannot be eliminated altogether. By pointing out the warning signals, this subjective element can be minimised. The Bell Telephone Company at Philadelphia, U.S.A. trains its interviewers with ten lessons : Establish tentative job qualifications. Review application for employment. Preparation for conducting practice interviews. Conducting practice interviews. Recording the findings. Interpretation of the findings. Introduction of job specifications. Evaluation of findings. Closing the interview. (10) Practising the complete interview. (1)

(2) (3) (4) (5) (6) (7) (8) (9)

Some companies employ those trained in psychology and psychiatry in the personnel department to interview candidates. Others hire and train people to become expert interviewers. Purpose of Interview: The primary purpose of the interview is to complete and get the correct picture gained through application forms. It measures the ability of the candidate to speak and present his views, his SOciability, poise, appearance, that almost undefinable personality, etc. Through the interview conducted by the employment manager, information about the company policies, practices, programmes and opportunities may be given to the candidate. There may be just one main interview. In the case of supervisory or managerial personnel more than one interview may be conducted. Interviews are the most widely used personnel tools of selection and some companies may have no other hurdles than this and on the basis of the interview, a candidate may be selected or rejected. Types of Interviews : There are various types of interviews employed by the companies. In India most of the interviews may be oral and informal. Then there are some whose interviews are well planned and well conducted. The following are the different types of interviews and they are briefly discussed: Informal Interview. (2) Formal Interview. (1)

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267

Planned Interview. Patterned Interview. . Non-directive Interview. Depth Interview. Stress Interview. Group Interview. PanelInterview.

(1) Informal Interview: An informal interview is an oral interview and may take place anywhere. This type of interview is perhaps followed very widely in India. The employer or the manager or the personnel man may ask a few almost inconsequential questions like name, place of birth, names of relatives etc., either in their respective offices or anywhere outside the plant or company. It is not planned and nobody' prepares for it. This interview is used widely when the labour market is tight and when you need workers badly. In India, a friend or a relative of the employer or manager may take a candidate to the house of the employer or manager, where this type of interview may be conducted. In some instances, the candidate may not open his mouth at all, for his friend or relative may be doing the talking with the employer. The employer or the manager may hire the candidate. This happens not only in our country, but, perhaps in other countries also. (2) Formal Interview: Formal interviews may be held in the employment office by the employment officer in a more formal atmosphere, with the help of well structured questions. The time and place of the interviews will be stipulated by the employment office. The formal interview will attempt to elicit the relevant information from the candidate and the interviewer may have a prepared list of questions that he is proposing to ask the candidate. (3) Planned Interview: It is formal interview, which is carefully planned. Here the interviewer may have a plan of action worked out in his own mind and he knows how much time he is going to devote to each candidate, what type of information he is seeking and what he proposes to give, how to open the interview and how to close the interview and how to conduct the interview. He may use the plan with some amount of flexibility. He may deviate from his plan, but he knows what he is doing and he can come back to his original plan and continue the interview. In a planned interview there need not be any waste of time, embarrassing moments of silence, and failure to obtain some relevant information. (4) Patterned Interview: A patterned interview is also a planned interview, but it is more carefully pre-planned to a high degree of accuracy, precision, and exactitude, with the help of job and man specifications, a list of questions and areas will be carefully prepared, and it will act as the interviewer's guide. With the help of this formal list covering all aspects the interviewer can go down the list of questions, asking one after another and this list is also a memory aid to the interviewer. But the interviewer's guide may be supplemented to gather any other significant information and this is dependent upon the skill of the interviewer. (5) Non-directive Interview: Non-directive interview or unstructured interview is designed to let the interview speak his mind freely. The interviewer has no formal or direct questions, but is all attention to the candidate. He encourages the candidate to talk by a little prodding whenever the candidate is silent. In recent times this type of interview is gaining much interest. The interviewer may start off thus: "Mr. Raj, please

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tell us about yourself after you graduated from high school", and keep the interview going by prodding questions or suggestioljls. The idea is to give the candidate complete freedom to "sell" himself, without the encumbrances of the interviewer's questions. But the interviewer must be of a higher calibre and must guide and relate the information to the objective of the interview. Interpreting the information given by the applicant and relating it to the job requirements calls for great skill on the part of the interviewer. (6) Depth Interview: Depth interview is designed to intensively examine the candidate's background and thinking and to go into considerable detail on particular subjects of an important nature, and of special interest to the candidate. For example, if the candidate says that he is interested in tennis, a series of questions may be asked to test the depth of understanding and interest of the candidate: who was the Wimbledon men's champion in 1975 and women's champion in 1975? Who was responsible for India's victory in the Davis Cup match against Brazil? Where was the match played? What are the different types of grips used by tennis players? What are the various types of surfaces on which tennis is played? What is the bounce of the tennis ball like on these different surfaces? How long have you played tennis? Do you like singles, doubles, or mixed doubles, play? Similarly great many questions may be asked about tennis to test the candidate's understanding. The theory is that this gives the interviewer the necessary insight to evaluate and assess the individual candidate and if the candidate is found good in his area of special interest, the chances are that if he likes the given job, he may take serious interest in the job and deliver the goods for the company. These probing questions must be asked with tact and through exhaustive analysis, it is possible to get a good picture of the candidate. (7) Stress Interview: This type of interview is designed to test the candidate and his conduct and behaviour by putting him under conditions of stress and strain. The interviewer may start with, "Mr. Raj, we do not think your qualifications and experience are adequate for this position" and watch the reaction of the candidate. A good candidate will not yield, on the contrary he may substantiate why he is qualified to handle the job. This type of interview is borrowed from the military organisation and this is very useful to test behaviour of individuals when they are faced with disagreeable and trying situations. (8) Group Interview: The group interview is designed to save busy executive's time and to see how the candidates react to and against each other. All the candidates may be brought together in the employment office and they may be interviewed. In another type of group interview, the candidates may be given a topic for discussion and observe who will lead the discussion, how many will participate in the discussion, how each will make his presentation, and how they will react to each other's views and presentation. (9) Panel Interview: A panel or interviewing board or selection committee may interview the candidates, usually in the case of supervisory and managerial positions. This type of interview pools the collective judgements and wisdom of the panel in the assessment of the candidate and also in questioning the faculties of the candidate. In the case of executive positions, the candidate may be asked to meet the panel of interviewers individually for a fairly lengthy interview.

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Interview Rating

A method widely accepted in vocational guidance and persOlmel selection is "The Seven-Point Plan" which provides a framework for listing and examining the impor· tant aspects of personality to be sought under the following headings ;3 (1) Physical Make Up : Health, physique, age, appearance, bearing, speech. (2) Attainments: Education, occupational training and experience. (3) Intelligence: Basic and "effective." (4) Special Aptitudes : Fluency, written and oral, numeracy, organisational ability, administrative skill. (5) Interests: Intellectual, practical, physically active, social, artistic. (6) Disposition: Self-reliance, nature, motivation, acceptability. (7) Circumstances : Domestic, social background and experience, future prospects. To this may be added position requirements and family background, which would give important relevant information on the upbringing and moulding of his personality, family conditioning, values in life, parental influenc.es. This would act as interview guide and the candidates .may be rated on 5 point rating scale, by the selection committee. It must be stated that most people do not know the art and skill of interviewing. It must be learnt, cultivated and practised. Many top companies are offering courses on selection process to their top executives. Company executives would benefit a great deal if they are trained in the art and skill of interviewing. (e) Tests: Psychological selection tests such as aptitudes, attitude, personality, interest, character achievement ana various tailormade tests may be used in the selection procedure. The companies may get the assistance of experts in universities and institutes of management & management consultants fot testing. (f) Pre-employment Physical: Hire healthy employees. To make sure, give a pre-employment physical examination through a doctor hired by you. Medical or fitness certificates are dime a dozen; so there is no point in going by them. (g) Selection and Placement: In U.S.A. and in som~ of our leading companies, the in-basket technique is used in the selection of executives. An in-basket test is a collection of documents which presumably have accumulated in the in-basket of a manager and are awaiting his attention. The particular documents in the in-basket constitute the test items. The examinee responds to these test items by taking actions as though he were actually on the job, and whatever results he produces in taking the test are his 'answers' to the text items .... The various systems devised in America yielded measures of his performance in a wide variety of areas including; (1) The manner in which he analyses the problem. (2) The types of decisions that he makes. (3) The kinds of actions he takes. (4) The way he communicates with others. (5) His method of organising or approaching the work. (6) The amount of initiative he shows in solving problems. (7) The way in which he delegates work. (8) The way in which he interests his staff.

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(9) The amount of consideration displayed toward others. When selecting people it is necessary to look at the fit of the individual for the immediate job for which he is being considered and how well he will fit in the company as it will probably be in the future. (h) Induction: The next significant phase of selection is the executive orientation programme. We suggest an excellent model orientation programme used by IBM and our companies may modify wherever necessary and use such an induction programme. New Manager Orientation

There is certain knowledge that a new manager must acquire immediately if you, as a new manager, are to be effective. This information is essential in the first days as a new manager and concerns problems which could develop at any time. Many of these items are unique to your own position and location. You must know: - The people who work for you. - The work you are responsible for. - Results you must accomplish. - The current status of the work. - Your relationships . .- Reports and records you must understand and maintain. - Local or functional procedures, policies and regulations. - Service groups available to help you. The orientation phase of New Manager Training provides you with the operational knowledge that is specific to your position and location - that cannot be delayed and is needed to get your assigned tasks done. The primary responsibility for the orientation of a new manager is with your immediate manager. The nature of much of the knowledge is such that your manager must be the source. Other information can be transmitted by the location service groups when they are available. There is also information which you can acquire by yourself if you are made aware of its sources. The immediate Orientation should be completed within two or three weeks following promotion. Each Management Development Department will establish a plan at its location or area to insure that this activity is completed. They can assist by constructing a checklist or lists which present specific items for the location or function. The checklist will help the second-level manager to plan for the orientation of the new manager. During the first few weeks following promotion, the new manager will be learning many things, so it is essential that the Orientation be limited to only those subjects that are critical to your needs at that time. Many of the topics will also be covered in the Fundamentals of IBM Management Course and in Basic Manager Training. However, those subjects that are essential to the particular job should be included in the orientation. Content I. Your Job and Organisation: Th\s inforIIl~tion should be presented immediately by the new manager's man.

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(A) Position Objectives and Organisational Relations: (1) The purpose and work of your organisation. (2) Objectives or results for which you are personally responsible and account-

able. (3) Flow of work to, within, and from your organisation. (4) Positions and persons to which you are accountable. (5) Other IBM and non-IBM groups with which you are closely related in a working relationship. (8) Getting Work Done: (1) Kinds of planning of work needed. (2) Schedules that must pe met. (3) Requisitioning or ordering supplies, materials equipment, services. (4) Quality controls and reviews -

available reports frequency. (5) Operating reports and data you are to maintain. (6) Maintenance and how to order, preventive maintenance measures, housekeeping. (7) Types of expenses, authority over expenses, overtime control, expense accounts, telephone, telegraph and mail costs, current status of operating statement and budget.

(C) Personnel Information (including files and records) : (1) Education and experience of each person. (2) Salary histories.

(3) Attendance and health records. (4) Most recent appraisals. (5) Significant accomplishments and noteworthy characteristics of each person. (6) Current status of any pending actions (salary, promotions, transfers, release,

etc.) (7) Current work assignment for each person.

II. Location Policies and Procedures: This knowledge is also needed by the new manager and should be presented within the first few weeks. It can be presented by your immediate manager or by the appropriate service or staff group, Personnel, Office Manager, Salary Administrator, Finance, etcetera. You should meet all of the staff persons who are available to assist you. (A) Personnel Relations: (1) Role of staff groups: personnel, salary administration, education etc. (2) Employment and your part in it. Recruitment, employment requisition,

application form. (3) Transfers, types, handling requests for transfers, use of forms. (4) Salary administration: position codes, descriptions and salary ranges, forms to use, how to determine and write salary recommendations, approvals, budgets.

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(5) Pay procedures: schedule and distribution of pay cheques, mailing of cheques, deductions, overtime premiums and authorization, mail allowances. (6) Personnel records and files: content, use. (7) Employee training : what to discuss with new employees, the orientation programme, tuition refund, other education programme. (8) Employee health : medical standards, medical reporting, visits to sick employees, deaths. (9) Time off and leaves of absence: your authority, reasons and procedures, personal business, educational, military service, jury duty, community activities. (10) Time cards: requirements to use, meaning of codes, absence and lateness. (11) Appraisal programme: forms, schedules, approvals, disposition of forms, other procedures. (12) Benefit plan: producers and forms to use, eligibility, approvals, etc. (13) Manager-employee meetings: purpose, method, content. (14) Responsibilities with respect to grievance channels and procedures, open door policy, speak-up, etc. (8) Administration: (1) State and local labour laws. (2) Safety-accident prevention: compensation laws, what to do if an accident occurs, company liability. (3) Expense accounts: travel, moving, living, allowable and non-allowable items, approvals. (4) Purchases: purchase requisitions, appropriations, approvals, etc. (5) Solicitation of employees. (6) Release of information about employees. (7) Correspondence practices. (8) Budgets and operating statements: how to prepare, what is included, code of accounts.

(C) Security: (1) Federal Government Security Regulations (if applicable). (2) IBM and Location Security Regulations and Procedures . . (3) Proper security of Classified Materials. (4) Proper Use and Handling of IBM Confidential Documents. (5) Proper Use and Handling of Personal and Confidential Materials. III. Manuals and Publications: During the orientation, your manager should be certain that you receive and know how to use the IBM Manager's Manual, the location or division Manager's Reference Manual (procedures) and other manuals and publications needed for continued uses in your job". In addition, a wide variety of printed materials, employees handbooks, pamphlets, picture stories, comics, cartoons, movies and slides are used to educate the new manager about the company. The companies must develop such material and we

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would highly recommend the medium of films in getting across the message to the new manager. ) The chairman and general manager must make it a point to meet the new executive and potential executives and impress upon them and request them to rise to the occasion. (i) Follow-·up : The objective of follow-up is to see whether the right man has been placed on the right position, or there has been a mistake. If he has any problem, he must be helped. If he is functioning well, pat him on the back and encourage him to do better. Then we have the pleasure of having placed the right man on the right job at the right time. However, no matter how much care is taken in recruitment, selection and placement, some people will not be effective in their present positions. There is a lingering tendency in some organisations to avoid this issue, either by ignoring the inadequacy or by pushing the individual into a situation which has been aptly described as on-the-job-retirement. It is unfortunate that by the' time a clear pattern of poor performance is seen, the chances for effective development are rarely good. Another position for which the individual may be suited may be found. However, if a job permitting effective performance cannot be found, termination should be the alternative that is used as readily for por work as for moral turpitude. Separation of individual from the organisation, when necessary, does not need to be cruel and can, through a sincere but firm attitude, be dealt with in ways that preserve the dignity and self-respect of the individual. Scientific selection, one of the most important principles of scientific management, helps the ED. process in that it provides the most appropriate executive resource material to start with and this makes ED. effort much easier and faster.

REFERENCES 1.

2. 3.

See Robert K Stoltz, "Executive Development - New Perspective", Harvard Business Review, May-June, 1966. See, MN. Rudrabasavaraj, Dynamic Personnel Administration, for greater details. Rodger, 1952, quoted by Central Training Council, Training and Development of Managers: Further Proposals. (London, Her Majesty's Stationary Officy, 1969), p.27.

DOD

25 UNIFIED STRATEGY OF DEVELOPMENT STRATEGY OF DEVELOPMENT The sector may adopt a long-term strategy in meeting their needs of executive personnel. Long-term Strategy: is to recruit young brilliant competent professional personnel and then mould and develop them according to the organisational and individual needs over a period of time. Spotting Talent: Organised and well-planned spotting high talent by the personnel, executive development and line executives through an analysis of appraisals, .1chievements and performance record is also necessary. Such high talent personnel should receive greater attention in development assignments and accelerated promotions and individual career developments of such talent would go a long way in meeting the current shortage of competent executives in private sector. Each undertaking should spot high talent and develop them and in 10 years they will have very competent executive talent for taking up higher assignments in the sector. Talking about the strategy of ED., it is essential to bear in mind that 90% of the development occurs as a result of on-the-job experience the way he manages, the way he is allowed to manage, the way his superior manages and the impact of his style on

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the subordinate, and the general environment created by the management system in vogue. Formal training and development programmes affect only 10% of his development. Hence the best of formal development programmes cannot help the individual much if he is unable to use new learning, knowledge, skills and techniques. We suggest a combined unified strategy, ED as depicted in the chart. Unified Strategy ofl ED I

In-Company EFFORT

Out-Company EFFORT

I

I On-the-Job EXPERIENCE

I

I In-Company TRAINING & DEVELOPMENT

I Out-Company FORMAL TRAINING & DEVELOPMENT

I Out-Country CROSSFERTILISA TION

In our scheme, the in-company on-the-job experience plays critical role in the strategy of ED. It is fair to concede that the executive or manager "manages" and uses the process of management. Definition of Management: Management is the total executive process of planning, organising, motivating, coordinating and controlling with a view of achieving predetermined ends with economy and effectiveness. Management is not learnt by textbooks or formal training programmes but by managing, i.e., by planning, organising, motivating, directing, coordinating and controlling. Decentralisation and Delegation: Decentralisation and delegation of authority commensurate with responsibility would set an organisational pattern that encourages and gives the freedom to the executive to manage and by managing, he gains more insights into the process of management and acquires the skill and art of management. Management Style of the Superior: In the process of managing, he is to a great extent guided by the style of management of his superior and he tend to observe and imitate him quite unconsciously. Management used in the company also has a powerful influence on the way he would act. Responsibility of Every Executive: Every executive must be made responsible for the development of his subordinates. He must guide, counsel and coach the subordinates and he must encourage the individual to show initiative and to come with new ideas and must be prepared to allow him to experiment and test his ideas. Without it there cannot be much growth. We shall presently discuss in the next chapter all the various development methods that can be used by the companies in providing on-thejob experiences as the more important part of the strategy of ED. Everybody Must and Can be Developed: Often senior executives believe they need no development because they feel they are "fully developed." There is no such thing and everybody must and can be developed and there is a lot of room at the top for improvement. It is a wise man who perceives his needs, strengths, weaknesses and aspirations. If you do not know, you had it! Knowing what you know and what you do not know is the hallmark of the true wisdom. ' . ,.

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Greater Orientation and Stress on the Art and Science of Management: It is high time greater emphasis is laid on the art and science of management in the strategy of ED. Greater appreciation of this need on the part of the company and action, is essential. The Mckinsey Company study on ED in American Banks stressed this l aspect. . Management Action does Pay-off in the Banking Industry: Although commercial banking is very different in many ways, the evidence is clear that banking is susceptible to management action. Specifically, banks vary Widely in their overall performance and results, and these variations in performance cannot be simply ascribed to chance factors - e.g., differences in regulatory controls or geographic conditions. The Task of Bank Management is Assuming Several New Dimensions: The squeeze on the profit margins, the increased scope and complexity of running today's company, and the increasingly competitive environment that practically every bank is facing have combined to create an urgent need for: (a) better planning; (b) better organisation; and (c) better personnel development. The magnitude of these new needs is such that they create a substantially new set of challenges to bank management. Some Organisations are Meeting these new needs more effectively than others: Some companies are clearly lagging behind the industry in coming to grips with their planning, organisational, and personnel development needs. Others, however, are pushing ahead aggressively and seem certain to develop an enduring competitive advantage. They identified three crucial areas of planning, organisation and personnel development-all related to the management process as contributing to the effectiveness of the bank management. Building an Effective Planning System: One of the distinguishing characteristics of those companies that appear to be moving ahead faster than their competitors is their commitment to superior planning. The planning of many other banks however, lacks substance or value. Although no two banks approach the planning task in exactly the same way, the successful planners have; (1) thought through the proper focus and scope for their planning effort; (2) developed practical and effective means for dealing with strategic issues; (3) rebuilt their management information system. Establishing a more Dynamic Structure: Many banks beginning to feel the cumulative pressures of increased size, complexity, and diversification on their traditional organisation structures. As a result, three new organisational practices each at a somewhat different stage of evolution in the industry are emerging. They are: (1) organising around businesses; (2) restructuring top management's role; and (3) building superior staff capabilities. Development of Superior Manpower Resources: Commercial banking faces five perplexing manpower development problems. Competing for manpower, meeting early career expectations, assimilating specialists; developing meetings; and improving compensations practices. Those banks have generally taken the following steps: (1) clearly defined the kind of men they want; (2) established viable career paths for their key manpower; (3) begun aggressively developing the next generation of top management; (4) revamped approaches to compensating and evaluating people; and (5) upgraded the staff charged with administering their personnel matter." These observations provide some guidelines for developing future company ER in our companies, for the most crucial pro~lems facing our companies are in the areas J

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of planning, organisation, motivation, designing control systems, developing superior ER, human relations, marketing. Lastly, in the strategy of ED, determine in-company on-the-job experience methods, in-company formal training and development programmes, and then outcompany formal training programmes. We wholeheartedly agree with one of senior trainers in the industry when he comments: "While formal training schemes are good as far as they go, it is first necessary to understand the words 'training' and 'executive development', in all the ramifications, any tendency on the part of company management to assume that having established training institutions and with the presence of training executives, training and development will take care of itself, would be selfdefeating." Leadership: It is best to remember that formal training is but a supporting function and cannot take care of the whole range of development of staff at all levels and at all stages. In an organisation, if the training responsibilities are but indifferently appreciated, the achievements can never be up to expectations. Executive development cannot be limited in range to starting a centre or sending an executive on a course. For instance, dearly spelt out organisatiohal objective, a diligently implemented system of recruitment, delegation and accountability, preplanned proper utilisation of human resources, managers who know their job and have leadership qualities, are all essential ingredients of the total atmosphere which build up people. Even in the U.S. where there is much emphasis on training only about five per cent of a member's entire career is spent on formal training. There has to be an emphasis on concentrating heavily on-the-job training. It can be estimated that the bulk of an employee's development occurs in the area of knowledge, skills and attitudes which are shaped on the job. Quite a few of these are imitative and environmental depending upon the personality of the superiors and the environment in a particular office. Achievement however small is a great morale booster and builds up and has a major influence in shaping a man's future growth." Self Development: Having said all that, it must be said that primary responsibility for development rests with the individual "For development is always selfdevelopment," wrote Peter Drucker, "Nothing could be more absurd than for enterprise to assume responsibility for the development of a man. The responsibility rests with the individual, his aptitudes, his efforts. No business enterprise is competent, let alone obligated, to substitute its efforts for the self development efforts of the individual. To do this would not only be unwarranted paternalism, it would be foolish pretension." The Role of the Individual-Some Essentials: The whole of EDS is for the benefit and growth of individual executive, with the firm belief that in the growth of the individual lies the corporate growth. Hence the individual has a key role to play. The individual executive has to meet certain essential conditions: (1) The individual is committed to his self-development. (2) To perceive his developmental needs. (3) He goes along with the strategy of development of the company, preferably having a say in it. (4) He is committed to the concept of self-actualisation. 2 (5) He is committed to the concept of self-renewal and self-innovation. (6) He associates his interests with organisational interests. (7) He cooperates with the company and the school in EDS.

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Here also, these conditions are easier stated than realised. In the actual business world, the individual has his own inhibitions. What are some of his problems? (1) The individual does not take responsibility for his own development. (2) He takes the attitude : "well, let the company develop me, why should I bother?" (3) He does not have any need for development or training. (4) He feels that he is at the top; hence no more of the training routine for him. (5) He feels that he is at his best~ so no more development necessary. (6) He takes this fatalistic attitude-"Either I have got it or I don't; why sweat about it?" We might well agree that no development can take place when the individual has these attitudes. These problems have to be surmounted by the individual and he can do so himself; also with the help of the company and school. The individual must show initiative, ingenuity and inventiveness. He must playa positive role and be an active partner along with the other two characters in EDS. It is extremely important to integrate the organisational needs with individual needs and here one may adopt what late professor McGregor called the "agricultural approach" to executive development, where the fundamental idea is that the individual will grow into what he is uniquely capable of becoming, provided we can create the proper conditions for that growth. "Such an approach involves less emphasis on manufacturing techniques and more on controlling the climate, fertility of the soil, and methods of cultivation." After clearing the air regarding the strategy of ED,let us tum to a discussion of the next phase in the EDS-identifying individual developmental needs before ED effortin-company or out-company. Perception of Needs of Development

The companies must take a policy decision that they will always depute or put an executive on development programme only after identifying his needs of development. Perception of individual needs can be accomplished through. (1) Recommendation of the superior/head of the department. (2) Analysis of job requirements. (3) Executive performance appraisal. (4) Suggestions by individual executives. (5) Report of the management consultant. (6) Peer suggestion. (7) Chairman suggestion. Then there are a great many ways of determinin§ the executive needs of development and they are enumerated and briefly explained. Methods of Determining Training Needs

1. Analysis of an Activity: (Process, Job, Operation) To list as steps in a logical sequence the activities involved in producing a product or service, or part thereof, and determine what new knowledge or skills is called for or present knowledge or skills is to be modified.

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2. Analysis of Problems: To analyse problems and determine what additional skills, knowledge or insight is required to handle it. 3. Analysis of Behaviour: To analyse typical behaviour by individuals or groups and determine the corrective action involving training. 4. Analysis of Organisation: To analyse organisational weaknesses to produce clues to training needs, both individual and group. 5. Analysis of Performance: To analyse performance and determine if someone should get something, be it additional knowledge, skill, or understanding. 6. Brainstorming: To bring together a homogeneous group and to ask individuals in the group to call out any ideas they have for answering a "how to" question and identify items which call for additional knowledge, skill or attitude.

7. Buzzing: To ask audience of supervisors, managers, professional personnel, or others (as long as it is homogeneous) can be given a question such as, "what are desirable next steps in our training?" or "what additional areas of knowledge (or skill or understanding) do we need to handle our work better?" 8. Card Sort: To write statements of potential training needs on cards, hand them over to the person whose ideas are sought to arrange these cards in what he feels is their order of importance for him. 9. Checklist: To break down a job, process, programme, activity, or area of responsibility into a list of detailed parts or steps arranged in logical sequence and check off by each individual the items about which he feels he would like to have more skill or knowledge. 10. Committee: To constitute an advisory committee composed of person responsible for, or with a direct interest in, an activity to identify training needs. 11. Comparison: To compare what an individual is doing (or contemplate doing) with what others are doing or have done, learn about new ways to handle old problem, keep up to date on new techniques and procedures, fight his own obsolescence. 12. Conference: To identify training needs and make decision on ways these needs will be met in a conference of persons concerned with an operating problem. 13. Consultants: To employ outside consultants to determine training needs and develop ways to meet them. 14. Counselling: To discuss between a training practitioner and a person seeking guidance regarding ways he can improve his on-the-job performance or prepare for advancement. 15. In-basket: To measure or test a manager's ability to handle some of the day-to-day challenges which come to him in writing in his "in-box" from various sources. 16.· Incident Pattern: To note terms of success or failure, the responses to special situations and to study the pattern of deviation. 17. Informal Talks: To meet and talk informally with people for finding clues to training needs. 18. To arrange a formal meeting with the person or group concerned employing the interview technique. 19. Observation: To observe such things as may have value as indicators of training needs, especially needs which are just under the surface or emerging.

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20. Problem Clinic: To arrange meetings of a homogeneous group to discuss a common problem and develop a solution. 21. Research: To identify implications for training and development as a result of research. 22. Role Playing: To get clues to his training needs in a skill, an area of knowledge, or in understanding or attitude by observing how each role player acts in a role playing situation. 23. Self-analysis: To self-evaluate and know what is needed in the way of additional know ledge, skill, or insight. 24. Simulation: To analyse performance in simulation exercise to reveal individual and/ or group training needs. 25. Skills Inventory: To establish and annually update an inventory of the skills of their employees and to identify gaps or blind spots in reserve or stand by skills. 26. Slip Writing: To write on a slip the type of training needed and analyse the information on these slips. 27. Studies: To undertake studies which can tum up training needs which will have to be met if the plans are adopted 28. Surveys: To undertake surveys that can be used to take inventory of operations, employee attitudes, implications of advanced planning etc. 29. Tests: To perform tests to measure skill, knowledge or attitude and to identify gaps. 30. Task Force: To constitute a task force which, in analysing the problem may unearth training needs which must be met before their recommended solution to the . problem can be implemented. 31. Questionnaire: To develop a questionnaire to elicit information which can be used to determine training needs, delimit the scope of the training, identify course content, etc. 32. Workshop: To identify in a workshop the need for further understanding or insight about organisation goals or operations. Sources of Training Need Information:

Clues to training needs can come from a number of written sources. Even such sources as complaints, requests, suggestions, while usually oral at first, should be reduced to writing if they are to be used as a basis for determining training needs. The discipline of writing makes the information more precise and useful and of course official. Some of the methods described earlier produce written sources - studies and surveys for instance. However, for our purpose here, we consider written materials already in existence. Some sources for the same are: (1) Articles; (2) Books; (3) Case studies; (4) Complaints; (5) Crises; (6) Experience of others; (7) Factual Data; (8) Grievances; (9) Plans; (10) Policies; (11) Records; (12) Reports; (13) Requests; (14) Statements; (15) Suggestions; (16) Symptoms; (17) Other Sources. Let us go to a discussion on the executive performance appraisal, which is yet another important and relevant phase in the EDS.

~

UNIFIED STRATEGY OF DEVELOPMENT

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Performance Appraisal

The use of individualised plans for the development of particular men is, in fact, the most important 4characteristic of executive development. Basically, the process . follows a set pattern. "A man's performance is periodically appraised by his superiors. Questions are raised - "Is his potential greatest as a manager or as a staff specialist?" "What are his strengths and weaknesses?" "Where can he make his greatest contribution ?" Next, sometimes in consultation with the man himself, tentative decisions are made on what might be made to advance his development. Usually the resulting plan is then reviewed at a higher echelon of management, where it may be challenged, changed, or added to. But out of the discussion and debate emerges a development plan tailored to the individuals's uniques needs." What Mr. Stolz also reports on appraisal experience in USA should be of interest to our companies. s In the matter of appraisal method, leading companies are no longer particularly preoccupied with techniques; in fact, they seem distinctly gimmick-shy. They have long since dropped the highly structured approaches and elaborate rating forms of the early 1950s in favour of simpler approaches relying heavily on the appraiser's judgement and common sense. Line managers in these companies, knowing that their evaluations of subordinates must stand up to searching questions from superiors, have learned to think through their appraisal judgements. Companies recognise the danger of personnel bias and guard against it by constantly challenging appraisal conclusions by upper level executives. And there is insistence on factoriented judgement rather than off-the-cuff personal opinions.6 We suggest a continuous appraisal system, instead of the annual ritual and emphasis is on two aspects: (1) How well is he doing? (2) How can we improve his performance through development? There are various types of appraisals that are available to bank managements and they are: (1) Point system with weights for each factor (used in some organisations). (2) Non-point system with a chart or form describing the factors to be ap-

praised. (3) The rank-order or forced-distribution method, in which each supervisor

(4) (5) (6) (7)

ranks his employees on overall performance of each employee or divides them into groups such as top 10%, the next 20% etc. The field-review method in which the performance of each employee is reviewed in detail by the supervisor with the help of personnel department. The critical incident method. Management by objectives method. Self-appraisal.

The last three methods also may be useful. The management by objectives method would of course require adequate management information systems and reporting systems to be used effectively. MBO would mainly comprise: (a) Position description; (b) Definition of objectives, key tasks and targets; and (c) Appraisal. Depending on the needs and abilities the companies may choose any system.

•

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The performance appraisals when dovetailed with career development and management succession systems would set the ball rolling for ED effort in-company and out-company. Some of the elaborate checklist type of appraisals with a lot of personality characteristics with a 4 or 5 point rating scale used by the companies are the ones that are going out of vogue in business and industry because of the problem mentioned in our earlier discussion on appraisals. Typical Stages of a Good Performance Appraisal (1) An appraisal of the subordinate's job performance is written by his superior.

The superior submits the written appraisal to a committee which reviews and approves it. (3) The superior discusses the appraisal with the subordinate in a private interview. (4) The superior and the subordinate together create a personal development programme for the subordinate. (2)

•

A Continuous Custom-made Performance Appraisal- An Alternate Proposal: We suggest that the companies should adopt a continuous appraisal, where the appraiser watches and keeps a dossier on the subordinate, where he notes the highlights of the subordinate's performance during the course of the year as well as his shortcomings in performance. With such a dossier the appraiser is on surer ground at the time of confrontation with the subordinate at the end of the year. Here the appraiser is on his toes throughout, not come alive only at the time of the annual ritual and then go back to sleep over the appraisal.,. The Custom-made Appraisal: is narrative or open-end type of appraisal, where ready-made answers are not provided and you just check somewhat safely in the middle. We recommend a simple appraisal form that requires the appraiser to write answer to the following: 1. What are the employee's strengths? 2. What are the employee's weaknesses or areas that need development? 3. What is the employee's overall job performance? This appraisal is custom-made to the individual being appraised by comparing his actual job performance with the performance expected of him (through a concept like Management by Objectives) by the superior. Conspicuous by its absence in this type of form is a list of traits or characteristics that might be checked off in varying degrees, ranging from poor to superior. Many time, degree of such items as 'leadership', 'enthusiasm', 'loyalty', have led to bickering between the author of the appraisal and the man being appraised and have thus diverted all concerned from the true purpose of appraisal. They also soon lead to a discussion of personality. The foundation for Research on Human Behaviour at Ann Arbor, Michigan, in a report entitled, "Performance Appraisal and Review" makes this statement: "Personality ratings are notoriously unreliable, for the same man will be rated differently by different people. Appraisal of performance is more reliable and consistent. People can be more objective about their jobs, for they generally know how to improve results, while they seldom know how to" change their personalities."

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Review and Check: The written appraisal must be checked and reviewed by several people, preferably in a Committee, so that it may be based on more objective considerations and deliberation and it may have the complete support of management. Often there are complaints that the superior was prejudiced or there was a snap judgement. Appraisal Interview: The next important step in the appraisal interview where the employee finds out where he stands and what they think of his performance. This also gives the appraiser an opportunity to fully explain the details of the appraisal so that the employee is fully aware of his strengths and weaknesses. The interview provides the appraiser an opportunity to find out what the employee thinks of the facilities and job conditions provided by the management and what improvement management could make iri them. Personal Development Programme: A successful appraisal interview will provide time for a joint determination by the appraised employee and his superior of just what steps the employee should take to capitalise on his strengths and overcome his weaknesses. We would like to emphasise the joint aspect of this determination, for in the final analysis only the employee himself can bring about the desired changes in his job behaviour and attitude. Training for Appraisers: There is a need for training the appraiser in the appraisal concepts, tools and techniques. The training programme accomplishes the following ends: (1) Instructs in techniques of writing appraisals. (2) Points out the pitfalls to be avoided in writing appraisals, e.g., the halo effect, the constant error, the error of recent events, and personal prejudices. (3) Gives each participant in the training programme an opportunity to write a sample appraisal. (4) Offers each participant training in the fundamentals of conducting an appraisal interview, with an opportunity to role-playa part in a mock appraisal interview. (5) Points out the steps to take in creating an effective personal development programme with an employee. In-Company Effort (1) It should be based on a real need.

(2) It should be targeted at the areas where the need is great. (3) It should stress the development of an individual's ability to think effectively and his skill in human relations. (4) In so far as possible, it should be integrated into regular operations. (5) Since we learn best by "doing", the methods employed should be as close to "doing" as possible. (6) Methods should be appropriate to the status of the personnel involved. Development methods will work and achieve best results when individuals realise the benefits to themselves. On-The-Job Development Experiences

Broadly, two types of development process can be identified with in-company ED effort - (1) on-the-job experiences, (2) Formal training and development programmes.

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Let us first turn to a discussion of various on-the-job experiences that would assist in the ED effort. (1) On-the-job training. (2) Planned progression. (3) Rotational assignments. (a) Rotation among managerial training positions. (b) Middle level rotation in "assistant" position. (c) Creation of assistant to position. (4) Understudy. (5) Temporary promotions. (6) Committees and Junior boards. (7) Conference programmes. (8) Management Workshop programmes. (9) Coaching. (10) Special assignments. (11) Staff assignments. (12) Planned reading programme. (13) Inter-departmental meeting. (14) Management periodicals. (15) Executive position enlargement. (16) "Ringo" system. (17) Problem solving conference. Rotation among Managerial Training ~ositions: This involves the designation of certain managerial positions on the same level in the organisation structure as training stations to be successively occupied by trainees. The purpose is to give actual supervisory experience in a variety of positions in several departments. But when suitable placement is not forthcoming after training, disillusion grows greater on the part of the trainee. Middle-level Rotation in 'Assistant' Position: This involves shuffling trainees as assistant managers in several departments. The purpose is to broaden their experience at a high level in each department managership. Unspecified Rotation among Managerial Positions: This is a planned and unspecified rotation of managers from one department to another. The purpose is to give managers responsible experience in a variety of positions. Creation of Assistant-To' Positions: This training device permits the candidate to broaden his viewpoint by exposure to many areas of managerial practice. Here the superior can act effectively as the teacher and he can judge the assistant's decisionmaking and his leadership ability in selected cases. The training period can be tailored to assistant's needs. But if the superior fails as a teacher or is authoritarian the training will be poor and ineffective. Role Playing: This consists of creating situations in the classroom where the candidates in pairs assume roles of executive and subordinate and discuss the issues and at the end conclusions as to the most effective means of handling a situation can be. arrived at. The problem here is creating the environment of work situation. I

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Understudy: The executive is expected to train the understudy to fill his place when he may be away for sometime because of vacation, business trips, illness or other reasons. This is to develop flexibility and stability in the organisation as well as to provide opportunity to the candidate to show his mettle. The understudy system should be a part of an organised promotion system. Temporary Promotions: They may be found as an ideal way to train executives in medium sized and small firms. The candidate may be moved upto the next rung of managerial hierarchy and tested for his performance and made accountable during that period of temporary tenure. In some corporations to arrange for such temporary promotion may be impossible. Committees and Junior Boards: These are composed of middle level managers, selected on the basis of merit rating, who meet regularly and act as 'idea men' and their proposals will be considered by the responsible general executive and may be referred to the Board of Directors if found suitable. The advantage is that the perspective of the members is broadened and a sense of responsibility for the firm is instilled in them. Conference Programme: The~e imply group exposure to ideas developed by a leader or speaker. It is direct and economical. Thus a class of trainees may be instructed effectively in company policies, history, objectives, customer attitudes etc. University Management Programmes: Some universities organise courses, institutes, conferences and formal programmes to train managers for a specific period. These e~tablish valuable group contacts, which act as an aid to the efficiency of individual managers. But much depends on the quality of these programmes. Management Workshop Programmes: Through workshops or seminars instruction is provided in a wide variety of subjects and classes are restricted to a small number so that there might be a free exchange of varied experiences. The leader of each 'workshop is usually an operating business executive, who possesses both experience and teaching ability. In view of the variety of training programmes, the right training programme to achieve the predetermined objectives must be instituted after careful deliberation and planning. Coaching: This is an old technique discovered anew and the distinct feature is face-to-face counselling. Its success depends on the ability of the superior to counsel the subordinate and on the receptivity of the candidate. Counselling is an effective way to get a new subordinate oriented in his job. It involves continuous analysis of the subordinate's performance by the superior. This enables the candidate to understand clearly how the superior operates regarding inter-departmental relationships and personalities. Counselling cannot be standardized and should be personal in nature. When mutual confidence is developed, the exchange of ideas and views between the superior and subordinate can be extremely valuable. It may be necessary to teach superior the ability to coach well, for on this rests the success or the failure of the entire coaching programme. If the superior lacks the capacity to counsel, then the coaching programme will be ineffective. Special Assignments: As a method of development, the special assignments are excellent. A special project such as mechanisation of material handling, marketing of a new product, provision of technical service, branch expansion and organisation structure, management reporting systems, solving industrial relations issues etc. may be given to an individual executive who will work on the project, collect all the relevant material, make the necessary analysis and make recommendations. This helps tremendously in the growth of the individual. Then you may go a step further and ask him to

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implement the recommendation also if you find them sound and useful. In the process, the individual grows. Many leading companies in our country use this method. High expectations lead to high efficiency and productivity and low expectations lead to low efficiency and productivity. Staff Assignments: Many line executives have a poor appreciation of a staff job and it is good to give the line executive a staff assignment for a while so that he will learn under the function involved and the services and this type of planned systematic rotational assignment leads to job broadening which is good for his development. Planned Reading Programme: Executives must read about the developments in their special areas, general and business and management concepts. Good articles, papers and reports must be brought to the attention of the executives through a circulating clipping service. Whether the executives are uptodate can be tested by seminars held every month presided by the General Manager or the Chairman. Reading also would give the executives many new ideas for improving their operations, procedures and policies. Good companies make this an appraisal criterion also and the executive is rated on his reading. Executives who believe they are very practical, do not read and be current, are soon rendered obsolete and out of the mainstream of executive excellence. Inter-Departmental Meetings: Can also be very good method to widen the horizons of the executives and to give them the feel of how the pieces fit in the puzzle. The very fact they share their problems, experiences and ideas promotes learning and development. Management Periodicals: Companies may buy subscriptions of the leading management journals in the country for the executives, so that they can find time to read and refer whenever they like. This service by the company would help the executives to update their knowledge constantly and continuously. Executive Position Enlargement: As a conscious method of development enlarge and enrich the executive position description with lot of extra responsibilities such as participation and providing leadership to worthwhile challenging assignments in the organisation and community activities, religious activities, cultural activities, social activities, sports and games etc. so that executives learn to tackle some of these broader problems and help the community. In the process they help themselves and their growth both personally and professionally. The problem in the organisations appears to be that there is a job improvisation as a result of which there is a great deal of frustration, dissatisfaction and disenchantment among staff, particularly the middle management executives. This must be consciously and systematically met by the organisation top management with executive position enlargement. Ringo Method: Is an excellent method used in Japan. The process starts at the lower level of management. They prepare a note or a draft which contains the situation in which the decisions have to be taken. The draft is called the "Ringisho." This "Ringisho" is circulated among the other persons in the organisation regarding the decisions to be taken thereof. All the persons in the organisation, at the executive level, receive "Ringisho." In this process several suggestions, questions, problems, solutions and alternatives are put forward by all those who receive the "Ringisho." This way the "Ringisho" makes its way to the top men, i.e., President of the organisation for final decision. After the final approval is received the "Ringisho" is returned to its original drafter for further action.

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Here are some of the features of the "Ringo" system. The authority and responsibility are not clearly defined in the organisation. Secondly, there are no policy guidelines given by the top management. Thirdly, there is no initiative by the top management as the process starts from below. Fourthly, it is essentially a piece-meal approach and it contains no prior planning. Fifthly, the system reflects a tendency of collective decision-making, organisational loyalty and group participation. Problem-Solving Conferences: From time to time on a planned basis, whenever the organisation faces a major problem, they may organise conference to throw challenges at the executives and ask them to think over the problems and come with specific well worked out recommendation. Challenging problems are very good method of developing executives. All these methods and more must be consciously and systematically used for developing executives in a planned fashion. Unplanned unsystematic exposure to these different on-the-job experiences is of no use. Performance and achievement on-the-job is a great learning and development experience and it is where 90% of the learning and development comes. A Director of Training and Education. HM Treasury wrote some years ago what is relevant even today: "Every manager desires to have a satisfying and productive career. His training should be designed to awaken thi~ satisfaction from the very start of his career. ... " In addition to providing this systematic varied in company on-the-job experiences, we suggest that the companies organise in-company formal training and development programme.

MANAGEMENT DEVELOPMENT Case Studies (1) Matsushita Personal Development System. (2) Tata Model. (3) Singapore Model.

The Personnel Development System of Matsushita Electric 1. A number of problems confront many Japanese 'companies in terms of

in-house education: (a) Management executives of the corporations are too busy to develop managerial strategies dynamically and swiftly. (b) Busy executives can't train mid-level managers and subordinates who are capable of shouldering authority and responsibility. (c) It is not sufficient for a mid-level manager or a supervisor to feel that he has only to do his own j0b. He must also feel that he is an administrator and policy maker for the company. (d) Corporate structures have not adapted to the larger scale of operations. II. The personnel policies - the basis of "the long personnel development programs of Matsushita Electric" : (1) To master the basic management principles of the company and develop men who work to accomplish the mission. (2) To know management is based on men. (3) Sincerity and compassion are essential to management.

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(4) Using men, not by exercise of superior authority, but rather through understanding and trust. (5) In developing workers, the superior must make appropriate demands on them. (6) Delegating authority and responsibility. (7) The harmonious co-operation of all employees is indispensable for sound management. III. "The long-range personnel development programs" - the basis of personnel development of Matsushita Electric (Its ultimate goal is to develop employees who understand the basic elements of management) : (1)

Objectives of personnel development(a) (b) (c)

(d)

Through understanding of basic management principles. Improvement of professional expertise. Development of managerial supervisory ability. Generate new perspectives, deeper insights and strengthen character formation.

(2) Implementation policy for personnel development(a) (b)

Personnel development through experience. Implementation on a long-range and continuous basis.

(3) Organisational structure for personnel development(a)

Each Division Director has the responsibility for the training and development of the employees in his division. Each member of Supervisory Staff has the responsibility for the education and training of his subordinates. (b) Each Supervisor in charge of education and training in the Manufacturing/Sales Divisions assists his superior with personnel development. (c) Each Supervisor in charge of education and training in the Functional Divisions assists his superior with development of function - specific abilities in employees. (d) The Role of the Corporate Personnel Office. 1. Formation of personnel development policy. Aid to each Division and functional Department. 3.

2. Planning and implementation of management training. Planning and implementation of training for new employees.

(4) Personnel development methods (To Ilse the methods listed below in an organically integrated and effective program of personnel development)(a) (b) (c) (d)

Self-improvement. Daily guidance by superiors. Group training. Practice.

(e)

Development through personnel system.

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The Personnel Development System of Matsushita Electric Matsumoto describe the system

Kuniji

"Before I go on to talk about today's main theme, namely, Matsushita Electric's Manpower Development Program, I should like briefly to discuss a number of problems that confront many Japanese companies in terms of in-house education. For many years I have been involved in Matsushita Electric's program for the development of personnel and manpower, and have also been involved in PHP Seminars where I have met a large number of managers from various corporations in Japan, and discussed with them problems of in-house education. In these discussions, I have come to realize that there are a number of problems common to us all. I have tried to summarize these common elements into the following four categories which I think are essential for an understanding of problems involved in personnel development in any corporation. It seems to me that it is absolutely necessary to clarify these problems areas before one can proceed with a proper personnel development pian. I have a strong suspicion that you in Indonesia will find that many of these problems are familiar to you and that perhaps a discussion of them could be of some benefit to you also. The first of the problems that the majority of corporations in Japan are facing with respect to manpower development is that managers and management executives are too busy. In the modern business world the changes in the management environment are so dramatic and so swift that most managers simply don't have time to devote to thinking about problems of personnel development. Thus they are forced to develop ad hoc measures to deal with conditions as they arise without a proper amount of deep thought devoted to them. The second problem is related to the first. Because managers are so busy dealing with day-to-day affairs and because there is such a complexity of matters with which they must deal, they'd like to be able to delegate some authority to their subordinates. Unfortunately however, since they haven't been able to devote time to a program of manpower development they cannot find any subordinate who is capable of accepting that authority. In Japan, the great majority of corporate executives feel this lack of subordinates to whom they can delegate responsibility to be a very worrisome problem. I suspect the same is true elsewhere in the world as well. Analyzing this problem is a little bit like trying to decide which came first, the chicken or the egg. But in my estimation it seems that one significant cause, perhaps the most significant cause of this situation, is that managers are harried by the necessity of dealing with a complex number of problems in a short time. They do not have sufficient time to devote to thinking about manpower development. In any case, the constant concern with immediate sales and profits that tends to prevail in today's business world - the tendency to concentrate one's attention on this aspect of business alone - has a deleterious effect. Managers have often concentrated on this immediate, short-range goal of sales and profits, and, as a result, have not paid enough attention to the long-range effects on the company and to long-range management strategy. Thus, they have not made a concerted effort to strengthen corporate structure by developing methods of scientific management, because the managers themselves often do not understand how important such methods are in modern business. The third problem involves the relationship of supervisors and managers on the line level. Today there is a large number of very qualified, talented, mid-level managers and supervisors who think that when they have accomplished the goals for their work category they have performed their duties with one-hundred per cent

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efficiency. Gut this simply isn't so, for as Konosuke Matsushita has said many times, it is not sufficient for a manager or ~upervisor to feel that he has done all that is required of him when he merely does the duties given in his job description. He must think of hImself as an administrator and a policy director in the company. This, if a manager of the accounting department were to perform his tasks in accounting with perfect efficiency, he would most likely feel that he had merited a grade of one-hundred per cent for his work. However, if he had no, really concerned himself with the general operations of the company outside of his own sphere, the best one could do would be to say that he had performed at seventy per cent efficiency. To be one-hundred per cent efficient he must also think of himself as a company director rather than an accountant, and from that standpoint, look at the suggestions for the betterment of operations in order to participate fully as a member of the whole organisation rather than a member of one specific element of the organisation. There are many managers who are not aware that holistic concern with company operations is. part of their duties. In other words, it is necessary for someone who becomes section chief, for example, to realize that it is not sufficient for him to perform the duties of section chief alone. He must at the same time feel and operate as if he could at any time, if called upon to do so, ber:ome manager of the general affairs section or even president of a corporation. The problem is that there are, in fact, not many managers or supervisors who have acquired this attitude towards business and their work. Thus, what is absolutely necessary is to d2velop the capacities and talents of supervisors at the middle management and direct supervisory level. Up to now, it has always been assumed that the structure of a corporation is somewhat like a pyramid, but the changes that have occurred in recent times have been so dramatic and violent that a new approach is called for. The complexity of modern business requires a far greater degree of specialized knowledge and talent than has ever beer, required before. Where the problems dre exceedingly complex, it will no longer be possible for the president of a corporation to deal with them personally. Problems which occur in the field should, as much as possible, solved by the managers directly involved rather than their being taken up by the upper echelons. I think it is becoming increasingly important to develop managers with the capacity to be able to solve problems on their own in the field as time goes on. In my long experience as an auditor of administration and accounting at Matsushita Electric, I have found that in the various sales divisions, when problems have occurred in the field they have been caused in part by the management on the presidential level, but just as often, if not more frequently, they are due to a lack of managers, branch managers, and section chiefs who are capable of making decisions and doing the work of the president on their own. Managers with this ability had not been developed within the corporation. The managers did not have a managerial perspective and tended to become mere bureaucrats or paper-pushing office workers. There are many instances in which this tendency is the direct cause of the lack of strong growth in the company and its implementation of policies. In fact there are many, many companies in Japan which are faced with these problems. The fourth question concerns the size of a corporation. There are many companies which operated quite efficiently when they were relatively small in scale, but as soon as the number of employees or plant and equipment began to increase, found that their efficiency did not increase, and in fact many have deceased. The reasons for this are many and varied, but I think one of the most obvious is that the various elements of the corporate structure are too loosely linked. In other words, the corporate structure itself has not adapted to the large scale of operations.

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What happens is that the corporations, in fact, shrinks within itself and becomes introspective, with the president still retaining power to make decisions in all areas and the managers on various levels concerning themselves only with their specific fields and their own individual work. When this happens, then there is not proper communication between one division and another, no cooperation and no integration. Because of this many mistakes occur in operations - the left hand doesn'l know what the right hand is doing - and I order to correct the various errors that occur there has to be a large amount of back and forth memo writing, visitations, and so forth to correct errors which should never have occurred in the first place. These errors increase in quantity as the number of personnel increase. As a result, the overall efficiency of the organization suffers and earnings do not increase. In such a corporate structure, people who are capable of taking over operatiors in later years are not developed, and there is no cultivation of subordinate personnel who have the ability to make decisions on their own. I have a number of companies which ended up in this state. I think one can say that most corporations in Japan have some difficulties in one or all of these four areas with respect to the development of personnel and education of personnel wilhin the corporation. I wonder if perhaps they might not also be problems that you are facing here in some of your companies in Indonesia. Afterwards I would like very much to hear directly from you about any problems that you might be having in terms of the education of your own workers, and what steps you have taken to solve these problems. But for the present, I should like to concentrate on what I take to be the most crucial problem facing many Japanese corporations in the area of personnel development. The president is too busy, and he cannot find the time to devote to the development of leaders among the workers beneath him or to the delegation of authority. Since this is a very common problem, it may be one with which many of you are familiar. If the things I will be talking about hereafter can provide some small hint towards helping in the solution of these problems I will feel that my time has been well spent, and I would be very happy. What I am about to say about the personnel management principles in Matsushita Electric will not be addressed point-by-point to the four questions we hav.e described above, but will, I think, in their total structure, help to give some suggestions for alleviating these problems. You have all seen the videotapes of actual instances of personnel practices and personnel development at Matsushita Electric, and I should like to use those videotapes as the basis for an understanding and talk about the long-range program of personnel development in the company. The long-range personnel development programs of Matsushita Electric are considered to be fundamental to the maintenance of a healthy organisation and in discussing these, we must discuss the fundamental personnel policies of which they are a part. The personnel policies were developed by Konosuke Matsushita was somewhat over thirty thousand (they presently number over sixty-five thousand). At that time Konosuke Matsushita realized that conducting all personnel matters in the corporate personnel division would simply not be efficient in a corporation as large as this and this it would be necessary to divide personnel matters and delegate the authority to personnel departments within each to the major divisions. At that time, Konosuke Matsushita, together with Arataro Takahashi, who was at that time managing director and later chairman of the board, developed seven principles to serve as the basis of the training of employees within the corporation.

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These seven principles are the basis of personnel policy at Matsushita Electric and are included in the packet of material" that you have been provided with I would appreciate you taking a look at the chart listing them to familiarize yourself with them while I talk. I think at the most important points, the fundamental- the kernel- the personnel management is contained in the two principles: (1) nurturing the best in people you employ; and (2) having people enjoy their work. Thus, in the short run, one could say that the fundamental aim of personnel management is to encourage the workers to do their best. Thus I really think that management policies come down to the question of what can I do to develop people under me eventually to do a hetter job than I myself can do; that is the development of leaders. Thus, the management policy we are discussing is really a distillation of the experience and thought of Matsushita Konosuke with respect to the development of human potential. There is not enough time to go into detail on all of the management principles, so I shall limit myself to a cursory examination of the seven major components of ti-,at policy. The first major principles is to have the employees of Matsushita Electric understand thoroughly and utterly the basic business principles which underlie the corporation. The second major principle is to know that the root of efficient and proper management is human beings. That human beings themselves rather than materials are the basis of management. Thirdly, in personal matters one must realize that sincerity and understanding are absolutely essential components of any policy. The fourth principle amounts to saying that one carnot use one's authority in order to control one's subordinates, but must rather use trust and understanding in order to have one's subordinates do the things they should. The fifth point that I should like to make is that it is absolutely necessary in personnel matters to be able to delegate authority and give those under you responsibilities to shoulder. And the seventh point is that the harmonious cooperation of all employees is a crucial factor in sound management. I should really like to go into some detail and talk with you at length about each one of these given points but since our time is severely limited, I will simply refer you to the comments that are written on the chart that has been provided in the packet. I think that it will be immediately apparent to you that these seven principles all center around the notion of developing a methodology for encouraging one's subordinates, and helping them to grow into leaders who have even more capacity to deal with things than yourself. This should be a compendium of ideas which allow you to help people to grow while using them in their various capacities; to get them to enjoy their work, expand themselves, and to develop a sense of cooperation and unity within the corporate structure so as to promote mutual confidence and efficiency in the organisation as a whole. These goals were thought to be so important that a training center was established, and in 1964 in order more fully to implement the training of leaders within the corporation a long-range personnel education policy was established. The education and training programs currently being used in Matsushita Electric are based upon this long-range policy. I should like to give a general outline of the basic elements of that long-range policy. This too, has been given to you in the packet of materials in the form of a chart. First of all, the basic goal underlying this long-range personnel development policy is to develop employees who understand the basic elements of management. Another way of saying this is that the aim of the educational program is to have each and every employee become a wide-ranging expert in company management.

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Why is it important to emphasize an understanding of general management principles in all of our employees? The reason simply is that the annual sales of Matsushita Electric amount to approximately 3.7 trillion yen (15.7 trillion rupiahs). And of that figure about half, to be more specific 55%, is earned within Japan. Now, of course, the sales are not made only by the employees of Matsushita Electric. The many employees of the wholesale and retail outlets who are dealing with the public also, in this respect, consider themselves to be employees of Matsushita Electric, dealing directly with the consumer. In these retail and wholesale outlets also, many are faced in their management policies with some of the problems we referred to at the beginning of this speech, and because of this, they are not achieving the efficiency or the profitability they think they should. Quite often in these operations, the employees do not live up to expectations and cannot rise to assume positions of greater responsibility. In fact, many of the outlets have a very high turnover of employees. Given this, the employees of Matsushita Electric feel it their duty as impartial observers to step in and do whatever they can to help their wholesalers and retailers to overcome their management problems. This basic principle of concerning himself with the stability and health of retail outlets is something which has motivated Konosuke Matsushita since he started business over fifty years ago. Because of these policies, the various retail and wholesale outlets, who are both customers of Matsushita Electric and its representatives to the public, have gradually acquired a stronger confidence in the company and have been willing to put forth greater effort for the company because of this. Thus, I think we can see that it is important for the Matsushita employee to be able to aid the wholesalers and retailers in their management problems. In order to do this, it is important that employees of Matsushita Electric do not concern themselves only with the production and advertising of their products, but that they also acquire an understanding of basic management principles and use these to help those with whom they deal. Each employee must have within himself the confidence that he too could become the president of a retail outlet or the manager of a large retail store. He must adopt an administrator's point of view. This sort of attitude is obviously required of the salesman who deals directly with the retail and wholesale outlets. But in order for the salesman to have an effective understanding of the overall structure of the company and its operations and in order for him to have the support he will need in dealing with the customers, people in the various other departments -like purchasing, personnel, accounting, and production, and a variety of other programs - also to have an adequate understanding of the relationships between the various departments themselves. In other words, the salesman can see the company as an integrated whole only if various departments also have this wholistic view. Thus, we at Matsushita Electric emphasize that each worker must give to cultivate a managerial perspective. This is the mental principle of the longrange personnel development policy at Matsushita Electric. We can divide this basic policy into four fundamental categories which are listed in the materials that you have been given. The first concerns the objectives underlying personnel development; the second refers to implementation policy; the third concerns the organisational structure; and the fourth deals with the methodology of personnel development. When we look at the objectives of personnel development, the first point listed in the chart is a thorough understanding of basic management principles. By basic management principles what we mean is the basic thinking and ideals with respect to

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management which have emerged from the long management history of Matsushita Electric and which we have spoken about for the past day or two in this seminar. This first objective, then, is to have each and everyone of the employees learn these prinoples, not merely in an intellectual manner, but to have these principles become part of their very being as an employee of Matsushita Electric. Counting all of the various subsidiary and related organisations, the Matsushita Electric organisation in Japan now numbers over one hundred and sixty thousand people. In addition, overseas there are presently seventh-eight Matsushita related companies which employ over forty thousand people. These people work together with representatives of Matsushita Electric sent from Japan in order to develop and strengthen their company and at the same time to contribute to the development of the economy of their respective nations. Because of these people are involved in work related to Matsushita Electric and under the guiding principles of management developed by Konosuke Matsushita, these guiding principles, the outlines of the management policies, the basic creed, and the seven basic attitudes have been translated into the respective languages, and are recited each morning at the beginning of work so as to allow these employees to share in the spirit which motivates the employees in Japan. The second objective that we are concerned with is the improvement of the employee'S capacities and talents as a specialist. Within the corporation, there are a variety of different functions, for example, finance, research, production, administration, and the like, each one of these requiring a different kind of specialized skill. It is necessary, of course, to have the employees in these departments develop their skills in these specialized fields. The fourth is to develop in each worker new perspectives, and a deeper sense of his or her own human potential. In other words, this becomes a matter of the spiritual development of each individual as a human being. This is something which I myself think about constantly, and I believe it is absolutely essential for a leader to be a mature, autonomous individual, that he will be able to, with courage and without any regrets, give up his position and his power whenever it should be necessary. Anyone who has truly become successful in a large corporation is a person of determination who has committed himself totally to this job so that whatever the requirements he would fulfill them, and if the job should require that he leave it, he would do so without regret, without remorse, and with no sadness. GIven such a leader, the people who are working under him will be inspired with confidence no matter how many travails they may encounter in their day-to-day activities, because of the courage and dedication of the leader himself. Thus, the president and the top executives of a corporation should always have in mind that they must work to develop their own sense of dedication and courage to carry out their duties with complete dedication is not something one can learn from books. It is something that can only be communicated personally in the work environment and is something which must be striven for constantly on a day-to-day basis. Yet, it is something which is absolutely essential and which must be developed in all strata of a corporation from the president down to the lowest, newest employee. The second major area which I would like to discuss now is the implementation policy for personnel development. The first point here is that experience is an important fdctor in personnel development. When speaking of management and the education of workers, Konosuke Matsushita has always very strongly emphasized that the

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, most effective method of training workers is to give them things to do, to have them learn through experience on the job in actual work situations. In the previous sessions of this seminar we cited many illustrations of Konosuke Matsushita's avid interest in being on the front line to lead and train his employees directly over the years while they were at work. I myself personally witnessed this when I joined Matsushita Electric as a young man, and noted that Konosuke Matsushita would exercise his leadership of the corporation sometimes with great severity and sometimes with great magnanimity, but always with understanding and always to develop rather than simply to use the person. This strict but loving leadership on the part of Konosuke Matsushita has fostered an atmosphere of mutual encouragement and constructive criticism amongst the employees which has helped to develop their dual capacities and build unity in the corporation. It is this constant striving for self-development among employees, their mutual encouragement and criticism, and the unity that this produces which Matsushita Electric the consumers' support and enabled it to become the successful organisation it is today, This pattern essentially represents an integration of the management and education functions. Education and training through leadership is fused with education and training through actual practice; the fusion of the two has become the backbone of the personnel development policies at Matsushita Electric. A second feature of the implementation policies for personnel development in the emphasis on long-range and continuous programs. This is what might also be termed as life-long learning. When one speaks of education, there are many corporations that think of employee education as a process that begins and ends at the start of a person's career, but if education is, in fact, not carried out systematically and continuously on a long-term basis, it will not have any permanent effect. This is the reason that we emphasize continuous training, continuous up-grading and long-term educational plans for our employees. In the materials you were provided with for the seminar, you will find a chart listing the various educational programs and the level of employee that participates in each one. As you can see, for new employees and those on the lower levels most of the educational programs are directed towards developing their abilities in their area of specialization. Gradually as their length of service increases, they are introduced to a wider managerial perspective and an understanding of other related corporate functions. The longer they are with the corporation the greater amount of time is spent on educating them to understand the meaning of supervision and management in general so as to be able to serve on higher levels of the corporation. Over and above this, as they grow in corporate responsibility, more and more weight is put on the personal and moral aspects of leadership and human development. Thus, you can see that this chart illustrates the basic principles of the long-range personnel development policies: education should not be ad hoc, but should be a planned, long-range, systematic program which will develop the individual, both in his capacities as a human being and his capacities to a function as a member of the corporation. It begins with specialization, moves to a somewhat wider treatment of related fields, then to basic principles of management, and finally to moral principles of leadership. Now we come to the third point which is the organisational features of personnel development. Here I would ask you to look at the materials provided. The Organisation of Manpower Development, you will find in the center near the top, the superintendent of operations. He is the individual who, for his given sphere of

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operations, has an authority equivalent to that of the president of the entire corporation, that is, for his own set of operations, he determines what sort of technical know-how and education is required, how it should be learned, and he then implements these policies in order to have his subordinates acquire the knowledge he thinks they should have. Now, of course, a superintendent of operations such as the head of the television division, for example, cannot conduct all of these educational programs by himself. For this reason, at the corporate headquarters, there are education specialists in each of 26 professional areas, for example, auditing, accounting, personnel, who can be sent to assist the supervisor of operations in a particular division, either by providing the materials, lecturers or otherwise helping to develop the program under the direction of the supervisor of the particular division. In addition, because the director of the personnel division naturally has a special interest in these problems, an education and training center has been established at corporate headquarters with a large staff and ample facilities to assist the supervisor of operations and his designated educational officers in providing training for the people in their particular division overall education program for the more than one hundred thousand employees connected with Ma~sushita Electric has two components, the individual divisions, programs and the instructional center at corporate headquarters. In order to understand the structure of Matsushita Electric's manpower development program, it is necessary to have some understanding of the organisational divisions of Matsushita Electric itself. For simplicity's sake, you can think of each one of the divisions as being a separate company loosely bound to the others at the corporate level. And thus, it would perhaps be easier to think of the superintendent of operations as being the president of a corporation, somewhat like you yourselves. Next we move to the fourth area of concern for long-range personnel development, namely, the methods involved in personnel development. This is an exceedingly important part of the program and one which causes managers and administrators a great deal of anxiety and concern. At Matsushita Electric, divisional managers, plant managers, and directors of research centers are so busy contending with the various problems that face them on a day-to-day basis that they have very little time to devote to considering possible alternatives or methodologies for constructing proper educational programs for their subordinates. In 1973, Japan's economy was rocked by the so-called oil shock, and since that time, in the midst of general economic difficulties and the period of slow growth, executives and higher level managers within Matsushita electric began to reassess their o)-Vn performance and to feel that no matter how much they exerted themselves, and how well they attempted to do their job, their efforts were not sufficient to meet the demands placed upon them. Thus they have become quite conscious of the necessity to educate those subordinates who have talent and the willingness to work together to cope with the present severe conditions. It is often said that "every cloud has a silver lining," and in fact that may be the case in this instance, for the managers and various administrators within the corporation are now very strongly inclined to cooperate to the fullest extent possible in implementing the long-range policy for personnel development. Why? Because it relieves them of pressure, makes for greater cooperation within the corporation, and meets the demands placed on the corporation by society at large.

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Now, in concrete terms, there are five methods of personnel development which have been elaborated and which we would like to discuss today. The five categories, then, are: (a) self improvement, (b) daily guidance by one's superiors, (c) group training, (d) practice, and (e) the mechanisms of the personnel system. I would like to give a brief outline of the content of each of these methods. The five methods can be divided into two broad categories, the first of which is focused on the individual, and the second on group training in larger, organised patterns. Self-improvement and daily guidance by superiors are the training patterns for the individual, and it is my opinion that individual training of this sort is the backbone of personnel development. In other words, every individual has the capacity to develop through being trained by another. But merely being taught by others does not constitute true education. The individual must ask himself: in what way can I develop myself, and in what way can I perfect myself so as to develop my capacities to the fullest. If the individual takes this as his or her aim, and attempts to train himself to develop his capacities to the fullest, then he will be able to develop as a human being, and become a more efficient member of the organisation. Without this, nothing is possible. However, because everyone has a limited capacity for self assessment, simple self-improvement, however intense the desire, will not alone be sufficient to produce the full development of human potential we search for. And this is precisely the point at which individualized instruction of the individual by his immediate superiors and compatriots becomes a crucial component in the educational program. The most important goal of self instruction is for the individual to become aware of the nature and purpose of his work, and acquire a clear understanding of what his deficiencies are. Once he has an awareness of what his defects are, then he or she can read, attend lectures, take classes, do any number of other activities to supplement those deficiencies so as to function more efficiently in his position. One point that we must be careful of when encouraging employees to engage in self-improvement is that the requirements placed upon the individual will vary because of changing conditions within the organisation and thus, the nature of the self-improvement study that the individual must perform will necessarily have to adapt to those new situations. Employees should be made aware of the necessity for adaptability. For example, ten years ago, there was no need for a salesman to acquaint himself with methods for dealing with the many kinds of customer movements. Today this has become absolutely essential. However, this is not the matter for the salesforce alone, for in their direct contact with the customers, the sales people can provide essential feedback to the technical departments within the corporation. Once the technical departments are made aware of this new problem, they in tum will do research to improve their operations and resolve the issue on their level. Thus, when one encourages people to engage in self improvement, this should have at least a twofold/two pronged orientation. The individual should, of course, develop greater skills in the fields where they are required for the performance of his duties in this own area of specialty, and he should develop skills to be able to meet head-on-problems which arise because of fundamental changes within the marketplace and in society as a whole. The major problems that occur in on-the-job training most often lie with a deficiency in the supervisor himself. A good supervisor must keep constant check on the work done by the employees under him, listen to suggestions and provide both appropriate encouragement and caution depending upon the situation.

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In my long years of working for Matsushita Electric I have been privileged to serve under a number of supervisors, most of whom were excellent, but there were some who would not remonstrate with me when I had done something wrong, or who would not praise me when I had done something that was quite good, or who would not instruct me on how to become more efficient. I must frankly say that these supervisors lacked something that I think is necessary in the model supervisor. Someone who is going to be a supervisor must be a person who can directly watch over the work of the people under him and who has the courage, the magnanimity and the intelligence to be able to encourage, reward, praise, and correct them which the occasion demands. This is what I meant I talked at the beginning of the speech about "encouragement" of employees being a crucial requirement for supervisory personnel. And as I said before, it is necessary for a manager to possess an enthusiasm which is communicated to those working under him, so that he can develop them into superior managers who will exceed him in capacity some day. Thus, the personnel policies, and principles we have discussed require that a manager or a supervisor make demands of those people who work under him. The reasons for this are quite clear. It is only when great demands and great expectations are placed upon an individual that he will respond in a manner that will develop his capacities to the fullest. For this reason, if you have a person who has an ability of ten, say, on some scale of rating, then demand of him that he perform on a level of fifteen, perhaps. If you do so, he will perform beyond his own expectations and will grow within the job and develop his capacities far more than he would have otherwise. If, on the other hand, instead of giving an individual work that is somewhat beyond his present capacities, you give him work that is less than his actual capacities, then that individual will not grow at all, but will, in fact, stagnate and become well nigh useless. This is why at Matsushita Electric we try to give the young employees responsibilities which go beyon5i what one would normally expect of them at that stage. These are, then, the points that I wanted particularly to emphasize with respect to the individual methods of personnel development. In contrast to the individual methods of personnel development. (a) self improvement and, (b) daily guidance by superiors, the group methods, (c) group training and (d) communal practice offer training opportunities not readily available on an individual basis. For example, there might be a famous lecturer or scientist in a particular field whom we could invite to lecture to us once or twice a year perhaps, but it would be impossible to have him come and talk with each individual member of a research team. A lecture or open seminar would be the most appropriate format. Other activities in this area would include group visits to other factories or installations for observation and study. The category we have called practice at Matsushita Electric might not be familiar to you. It refers to a number of activities, for example, the training conducted for all employees in the retail outlets. We have a system of acquainting each of the employees in the corporation with the functions of the retail outlets that deal directly with the customers, not through books but through actual first-hand experience. Thus it is a general policy within the company that before a person can become a section chief, whether they be in sales or in one of the other departments of the corporation, it is necessary for them to spend a certain amount of time as employees in one of the retail outlets. In particular, for new employees within the company, within the first year of employment, we generally require that they spend four months of that first year working in a retail outlet. Each new employee once he or she is accepted into the company, spends several weeks

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studying the general outlines and organisation of the corporation. Once this basic training is completed, the employee sent to a retail outlet to act as one of the sales staff in order to learn first-hand the operations of the business at the retail level. After four months, he is immediately sent to an assembly line in one of the factories for another four months to gain the first-hand knowledge of just how the company's product are manufactured. During these eight months, employees come back to the corporate headquarters for one day each month. There, they can ask any questions they might have about the work that they have been doing or about the corporation, they can engage in criticism, discussion, put forth suggestions for changes in the operations, ask about interrelationships between their work and the work of others, and generally reflect upon their experiences in the attempt to collate and structure them into an integrated whole. In addition to this basic training in production and sales, we also have a program which is directed towards people who have been in the company for three to five years during which they are exposed to work in fields other than their own. For example, someone who has been in the ratio and television division might, for example, be sent to the battery division to work and study for a certain period. Now, of course, it is quite obvious that the production techniques and processes involved in radio and television are different from those involved in production of batteries. And it is precisely for this reason that the ratio and television video technician will be sent to the battery division for an extensive period of six months or so, while at the same time technicians from the battery division to see how that functions in contrast with their own. The basic motive for this transfer of people is to widen the employee's horizons. By moving out of his own accustomed sphere and undergoing a totally new experience in different methods of production development the individual will be forced to engage in a certain amount of introspection, and will come to view himself, his work, and his own workplace in a more objective matter. Many acquire insights which make them and their departments more efficient in the long run. The development of personnel through the personnel system itself, which is the fifth and last method of personnel development, attempts to integrate both the individual and the group approaches into one. Basically, the personnel system program is divided into the white collar and the blue collar categories. As a general principle, by the age of thirty-five, each white collar worker will have worked in three different places within his field of specialization, moving roughly once every four or five years. For example, an accountant might spend some time at corporate headquarters, and then be transferred to one of the divisions, and then to a second division. The point of this is to prevent an individual from becoming a mere specialist or a mere office worker who shuffles papers in the same pattern year after year. The aim is to develop the broad perspective of a manager who has had experience in diverse areas of the business and who is able to integrate these into a coherent whole. At Matsushita Electric, a young man, for example, who has spent ten years in production after graduating from the university will perhaps be sent to one of the subsidiary companies overseas to act as general manager of the subsidiary itself, or the manager of one of thf' plants. In actual cases we have found that their managerial capabilities have dramatically increased because of this transfer in position and particularly so in terms of their ability to see things in a wide perspective, operate on a high level, and make decisions that are reasonable. We think that one explanation for this is that the diversity of experience that has been offered to such an individual has been helpful in increasing the breadth of his perspective, and also has given him a more solid foundation for becoming a good

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manager. Now, of course, given the nature and history of the business, it would be impossible suddenly to introduce a new manager into one of the domestic subsidiary companies, or the like, and because of the nature of the work within the corporation, a high degree of specialization is required for many of the white collar jobs so that it is not always feasible to transfer everyone every four or five years. Nonetheless, the general direction of the program is to provide for a diversity of experience in order to widen the perspectives of the future managers of the corporation. We presently are concentrating our efforts on finding ways to provide for a similar sort of job transfer plan to broaden the perspective of the blue collar workers also. The pattern of movement with the blue collar workers is, of course, not exactly the same as that of white collar workers, but the basic principle underlying their education is essentially the same that is to prvvide them with the widest possible a diversity of experience so that they can develop their capacities to the fullest and can function more efficiently within the corporation, this increasing their own satisfaction as well as the efficiency of the corporation. This is the general pattern of the system implementing the long-range personnel development policies at Matsushita Electric. At this point, I would like to discuss in some detail a number of crucial points which I have briefly touched on earlier, and illustrate them with some examples. I mentioned briefly before that the major goal of personnel development at Matsushita Electric is the cultivation of employees who fully uncerstand the management principles and guiding ideals of the company itself, I should like to discuss that now in a little more detail. Our founder Konosuke Matsushita has often spoken on the precise nature of management and business. What he has said can perhaps be summarized in the following way: we have been entrusted by society with people, things and money. We are to take these and use them in order to produce something of more value, the sum of activities connected with this creation of new value is management. Management is not a prerogative solely of the president of the company. All employees, including the receptionist, the telephone operator, and driver, are engaged in management. It is simply that each one of them has a slightly different sphere of responsibility. If they do not have the managerial spirit, they will not perform their tasks cooperatively and the efficiency of the company will, in fact, suffer. Thus, it is necessary to have each one of the employees realize that their job is essential in the management of the overall corporation. Any corporation, any enterprise, whether it be a department store, bank, supermarket or factory, will succ.eed as a business if it passes on this spirit of management to all of its employees. All the wholesalers and retailers of Matsushita products sell the same items at the same prices, but some have more success than others. Why this difference? I think if you look carefully, you will find that the successful firms actively strive to produce employees who actually understand management on a concrete level, and who feel this is a guiding principle in their work, while those that have poor records merely do lip service to the principle. It is important for each employee to have clear in his own mind the general features, functions, and operations of the company for which he works, otherwise, it is very difficult for him to think like a manager in his own field of operations. It is very difficult to realize this ideal but we must try. This may sound a little repetitious, but I cannot emphasize too much how important this point is.

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Of course, in order to cultivate such a comprehensive understanding of their company in the hearts of the employees, the supervisors must, on a daily basis, teach their subordinates and answer their questions. To become someone who understands management one must avoid becoming simply an office worker, a bureaucrat or a specialist who understands nothing but his own narrow field of specialization. Every worker must be ready to stand in for his superior on a moment's notice if called upon to do so. What sort of practice or training is necessary to attain these goals? There are, of course, a variety of different methods that could be employed but it is particularly important for each individual to devise a training plan for himself. To facilitate this Matsushita Electric has established a general policy requiring that once a year each employee fills out a self-evaluation form which, after consultation with the supervisor, is sent to the personnel department. This self-evaluation form informs the superior about how the employee assess his own performance and what he expects for the future. Should the superior find that his own expectations and those of his employee's are not in accord, the superior will then consult with each. If the differences are not resolved by this discussion, then the personnel supervisor to intervene and the three -- the individual, the individual supervisor, and the personnel supervisor, will together talk over the matter and attempt to set a direction for the individual's career in the company. The educational programs available within the company are very complex in nature, but the underlying structure is rather simple. The various educational programs are designed to take into consideration the actual function of the individual in his work place, decide upon the goals he is to work for and the methods for attaining them. In order to do this, it is first necessary to have the individual become acquainted with the management history of the company, and from this extract management principles with which to guide the corporation. As we indicated earlier, Matsushita Electric's management ideals are embodied in the basic business principles. Employee creed, and the seven spiritual values which are recited every day at the morning assembly in order to build up a spirit of cooperation and enthusiasm in the employees. I think that, as I have said before, what is most important is that each employee become thoroughly familiar with management philosophy and management principles. I do not mean just intellectual acquaintance, I mean that the principles should actually become the guiding spirit for individuals in their work. Any company in which the managers cannot fully and completely absorb the basic principles of rnanogement will certainly fail. Only when you have managers who will really take this seriously and really make an attempt to understand fully the basic managerial principles will the company be able to recover and be successful. For my own experience in having watched Konosuke Matsushita over the years, I can say without question that he placed the greatest emphasis throughout all of this managerial years on the inculcation of managerial principles and the managerial spirit in the people who worked for him. However, general management principles, as important as they are to any program of personnel development, will not alone suffice as content for an educational program. They must be supplemented by a series of increasingly concrete objectives, principles, and specific suggestions on a variety of 'levels. One must acquaint the individual with the specific objectives and plans on the corporate level for the sixmonth or year period, the specified objectives and policy directions of the division that he or she operates, the specific objectives and policies of the job category and functions

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of the individual himself within his job category and division. All of these, then, from the general to the specific, must be amalgamated into a comprehensive and integrated program to give the individual a sense of understanding into a comprehensive and integrated program to give the individual a sense of understanding about where he fits in the overall scheme and clear understanding of the general directions in which the corporation is moving. Given this broad perspective, it is possible for the individual to adjust his own goals and program to fit in with the overall objectives that he has an understanding of. The reason why I have emphasized this so much is that while most corporations will have a relatively clear set of policies and objectives on the corporate level, perhaps even on the divisional level, which are known to their employees, it is quite rare to be able to ask an individual employee, "What are your objectives for the year and how do they fit in with the general overall directions of the company", and receive any sort of satisfactory reply. Yet this is essential to healthy management. I think perhaps one of the most important objectives for an educational program is to make the individual worker aware of the objectives and goals that he or she will have in his own work. In fact, this is the basis of scientific management. Such a program creates an enlightened work force where each individual autonomously pursues his own work within the company, and where each is a strategist working toward a common goal. It is from such a program that new presidents are born and new managers are developed. Nonetheless, a great number of corporations and enterprises seem to have forgotten this or don't understand it very well. Thus I think it is absolutely crucial for managers and supervisors constantly to monitor their subordinates, to determine how aware they are of the goals that they are supposed to be pursuing in their individual tasks, and whether they are going to attain those goals. I have recently been asked to give a series of talks at a particular bank in Japan, and in this bank, most of the personnel at the teller's windows are female. From my observations, it seems that most of thp. tellers have, in fact, adopted a very bureaucratic and narrow attitude towards their work. That is, it seems that t.l-tey are not aware, probably because they have never been taught, of larger questions such as what is the purpose of their bank in the first place, what does society demand or require of the bank, what are the branch manager's major problems, etc. None of these larger ques~ tions has ever entered their consciousness. I have these many years been engaged in teaching the employees of Matsushita Electric. In my classes I explain to all the employees - whether they be drivers, clerks, telephone operators or receptionists - the basic management principles of Matsushita, what the company stands for, what it is trying to do, what its basic problems are, and how it is attempting to meet them. With some understanding of how their work fits into the overall Matsushita corporation design, their work becomes more meaningful to them and there is a tendency for them to be more efficient and more interested in their work. They are no longer people who are merely working for a salary but for some higher goal. If the employees think off themselves as merely working to receive salary for the time that they put in, then the fault lies with supervisors who have left them no alternative but to think that way. In this highly changing world of business, the executives, managers and leaders of the corporation, must bend all of their efforts to develop an enthusiastic and dedicated workforce. Nonetheless, it is not easy to make each individual worker aware of the goals that he has in his own job, and how they will

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fit into the overall of the organisation. All that one has to do is to ask first-line supervIsory personnel and this becomes exceedingly clear. Consldl'r for a moment what would happen if a manager or one of the board directors were to ,1sk one of the supervisors, "Just what is that you teach your receptionists; just what is it that YOll think is the most important thing that they should know about th~'ir job and their pl'lce in the corporation." What kind of an answer would he gt't? Most IIke!y the supervisors would say that it is most important to teach receptionists to follow tIll' guidelines for their job, to act with decorum, etc. If upon further qUL'stioning it bl'caml' app,Hent that the supervisor had no idea what regulations for rl'ception.sts were !1hlst important or why, they one could be assured he would not h,1\'l' ,1 good rl'Cl'pt)()Jllst. This would then mean that the supervisor himself was not doing hiS job pW~1L'rly But whose fl'sponslbility is that? Clearly that of the manager or the directors above him bec,llIse they had not taught this supervisor what were the most prominent, crtlci,ll ~'knll'nts of his job, namely, to teach certain things to the receptionist. With the corpur,ltion structured in his fashion, you ,have a number of individuals who are merely doing their own job with a narrow vision and not cooperating with others but simply operating as individuals doing specific tasks. This being the case, corporate unity is not achieved and corporate health suffers. When I speak of rationalization of a corporation, I think it is important to pay attl'ntion to development of specialized ties and specialized knowledge, but perhaps equally important, one must pay attention to the function of the manager of special affairs, for he has a particularly crucial role to play in any sort of corporate rationalization. It would be disastrous to have a company full of yes-men, or a company full of people who did not think of themselves as managers and who did not, therefore, enthusiastically expend all their energies to supplementing the deficiencies they might have as managers. In order to prevent the company from falling into such dire straits, it is absolutely necessary to hm·e an educational program directed towards strengthening the administrative abilities of its managers. What I am referring to is the ability to gather together the knowledge and the talents of others and to provide the little extra sorr,ething which allows those to blend together to form a harmonious whole. It is precisely that addition of something extra that I refer to as the basis of personnel development. In other words, what this comes down to is the ability to inculcate managerial ability. Managerial ability is really nothing more than being able to take a diversity of experiences, integrate them into a whole, and be able to add that "something extra" which forms them into an organic unit. Development people who have that ability is the goal of personnel development. In consideratron, in my long experience in dealing with manpower development within Matsushita Electric and in various PHP seminars, I have discussed problems of this sort with many executives from Matsushita and other corporations both inside and outside Matsushita and I would like to share what I have learned with you. For example, in one corporation a product is not selling, the question immediately arises why is it not selling? Quite often the response is because this is a time of recession, times are bad. If one respond, well, of course it is, but other corporations are selling the same sort of thing. Why aren't you selling? Then quite often the reply will be "well, our product is not as good as the others." If one doggedly pursues this, asking why the product is bad, the answer may be that it is too expensive. If you then ask why is it too expensive, you would probably be told something to the effect that the costs are

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too high. If this process of questioning is continued, one usually finds that ultimately human error is responsible for the lack of the sales. And this usually means that people have not been nurtured, trained, and develop to function properly and efficiently. If you are not selling a product, it means you have not produced something that people can buy with confidence and pleasure. Why? Simply because the people who have been producing it are lacking in some way or another, they have not become fully efficient and product employees. Given such a situation, then, what we should do is ask what is missing, why is missing, why are they not operating efficiently. If it happens that the source of the problems is the failure of a particular individual to perform his or her function then it is incumbent upon us to teach individuals whatever would be required to allow them to perform their jobs properly. If the source of the difficulty is traced to a group, then group education would be the appropriate means to handle the situation. This is the point that I wanted to emphasize throughout my speech, namely that the purpose of a long-term personnel development policy is to enable management to deal with problems of this sort and that it is only through such a policy that such problems can be dealt with effectively. I became acutely aware of these when I was director of the training center at Matsushita Electric, for in a Matsushita group there are over a hundred divisions. I would go to the division and inspect them periodically to discover just what the educational policies and practices wherein each division both with respect to divisional education and with respect to specialized professional education. I learned that some divisions provided very good education programs and some did not. The success of the various educational programs in the divisions depended to a large degree on whether or not the managers of these educational programs understood precisely what the problems were. Over and above this the effectiveness of an educational program depended on whether or not the educational program was conceived and implemented in an organic and wholistic way so as to be integrated completely with the actual operations of the division. As a result of this experience we now regularly call the training managers from each division to the center and invite a few who have been particularly successful to share with the group the principles and practices that they had used in their divisions. There are still a number of other points I would like to discuss today, but will conclude my discussion at this point. If you have any questions later, I should be glad to reply. Thank you very much for your kind attention.

TATA MODEL Tata Administrative Service (T AS)

The Tata Administrative Service was established in 1956 with the object of building up a corps of selected and highly trained officers capable in time of filling senior executive posts in the Tata Group of Companies. The first candidate was recruited to the TAS in June 1956, with a doctorate from the London School of Economics. He was appointed Director of Tata Industries on the 4th of April 1970 and as DireCtor of Tata Sons on the 1st of July 1972 - within a brief span of 16 years! Since then 84 candidates have been recruited, through 2 selections, including the latest batch of 10 selected in March 1974. Of the 84, 9 have left us; 3 were not confirmed (resigned - two found unsuitable, and one joined the lAS) and the services of one was terminated.

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The break-up of those who left us make interesting reading. Of the nine, three left us for joining the World Bank and other UN Agencies with our blessings and recommendation, as we feel that it is good for growth of our boys, for the country, and in the long run good for the Tata organisation, that they have an opportunity to work with International Agencies. One joined the Ford Foundation in India on deputation from the T AS, as consultant, and has now been in turn deputed by them as Secretary to the Trade Development Authority, Government of India. His lien on the TAS was not extended for a third year, but he still has a lien on Tatas. Yet another promising officer had to leave for England and stay in the UK for a number of years for the treatment of his spastic baby, and for the special training of the mother to look after handicapped children. In the UK, he distinguished himself in a short time and was appointed Director of Gallup. He is now back in India as the Managing Director of the Indian Market Research Bureau which belongs to the J Walter Thompson Group of England. Another T AS officer had to settle in the UK owing to domestic reasons and holds a senior position in the business world; one more had to join his family business; another left us for joining an advertising agency; and one left us after she became a mother, as the company could not offer her part-time employment. In all 13, out of the 84 candidates recruited to the T AS, are no longer with us giving us a turnover of about 15'10 in 18 years, which is among the lowest in the country. We are informed that the turnover of Management Trainee in Hindustan Lever is about 50% or more, and the turnover of DCM goes up to 75%. It is true that we are rather reluctant 'to get rid of anybody', instead we try to match a job for the officer according to his level. To grumble and grouse is one of mankind's most cherished satisfactions but few, if any, have actually left us because of dissatisfactions and frustrations. Two T AS officers are at present away from the organisation, one on deputations and the other on study leave. The former shouldered and completed the Taj Intercontinental project in an exemplary fashion, and is at present on deputation with CIDCO. The latter awaits the award of his Doctorate from the MIT in Management. Placements

Appendix I gives the distribution of TAS officers in thirteen companies. An up-to-date company wise list of all TAS officers with their designations, joining dates and locations is given in Appendix II. At present the largest number of TAS officers are with TELCO-19, followed by Indian Hotels-ll, and TISCO-9. Thirty four officers are stationed in Mumbai, 12 in Jamshedpur, 8 in Pune, 2 in Delhi and 1 each in Jaipur, Goa and Calcutta. The following 10 senior officers have risen to positions of responsibility in the organisation within the brief span of years indicated against their names along with their designations. It will be observed that we even have a vice president on our rolls. (1) Dr. FA Mehta - Director, Tata Industries, Tata Sons (1956-1970-1972) (2) Mr. V.K. Bali - Secretary & Chief Executive, Tatakem (1957-1969) (3) Mrs. K.R. Javeri - Secretary, TISCO& Director, Tata Services (1958-1968-1973) (4) Mr. N.D. Khurody - Divisional Manager, Inti' Operations (1960-1969) (5) Mr. X.s. Desai - Pwiect Manager, Indian Hotels (1961-1972). On deputation to croco since 1972. (6) Mr. R.K. Krishnakumar - Executive Director- Tata Finlay (1963-1973)

306 (7)

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Mr A Klrpal

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Manager, Tata Exports, Delhi (1963-1973) President, Sales & Marketing, Indian Hotels (1963-1973)

(8) Mlss C. Panjabl

-

VICe

(9) Mr. A.N. Maira

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S1. Dy General Manager, TELCO, Pune (1965-1974)

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Div. Manager, Manpower Planning TELCO, Jamshedpur (1966-1974).

(1l1) Mr. M.] Shaikhali

It so happens that the first and the last names of the 10 listed above, span a period of 10 years (1956-1966), during which time 30 candidates joined the TAS, through 15 selections. From 1967 to 1974, the number of new entrants increased to 54 within 8 years, through 10 selections. A bLlI1ch of vigorous youngsters from the second group who joined us since 1967, when we first started taking boys from the Management Institute, are shouldering increasingly important assignments almost immediately on confirmation. Both TELCO and Indian Hotels with their expansion programmes, are particularly able to give excellent opportunities for experience, growth and quick advancement to our youngsters, and 1wouldn't be surprised to see some of them on Tata Boards within the next seven years.

Recruitment Through Management Institute

We started recruitmg boys from the Management Institute since 1967 when the first boy joined us from the Jamnalal Bajaj of Management Studies, University of bombav. Since then, the two National Institute, IIM Ahmedabad and lIM Calcutta, have grwn us many first rate boys, 13 from IIM Ahmedabad and 9 from IIM Calcutta ha\·e been selected for the TAS Bajaj has given us 6 boys; and one each has been selected from the Department of Management Studies University of Delhi and Xavier Labour Relations Institute Jamshedpur. vVe haw 30 MBAs plus 9 graduates with Management Sciences on our rolls. Out of the 39, 24 have Engineering qualifications, most of them from the IITs. This means that they ilre the end product of a fine-combing on a national scale at three different stages Once at the lIT entrance exams, a second time for entrance to the IIMs and the thud, competing for the T AS. They corne to us after 8 years of studies. It may well be Sind that they are a part of the elite of India's youth today. It is, therefore, necessary for the companies to utIlise their talents and skills by giving them adequate opportunities for work and responsibility. By saying this, it is however not said that "lIT-MBA" is the ideal combination, and that we should no longer recruit from the wider field of the Humanities and the Sciences. Our own experience is contrary to this. Officers without Engineering or \lanagement Studies have done exceedingly well with us. The youngest Director of Tata Sons, the Executive Director of Tata Finlays and the Senior Deputy General Manager of TELCO, are three outstanding examples. The first from the LSE, the second a graduate in History and with a Masters in Politics from the Loyola College and the third with a Masters in Physics. I believe that it is always that man that matters; it is his mental equipment, qualities, character and his moral fibre which finally count. It should also be remembered that there is definite school of thought which maintains that the combination of high level Engineering and Management Studies tends to produce brilliant technocrats. They do not necessarily make good Managers because they try to quantify intangibles of life is not a mere quantification. The intanglbles of life are very often the most worthwhile values of human experience. A balance, a happy blend of varied strands of life is the golden mean.

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After saying this, it would be interesting to examine the following subjectwise break-up of the 71 TAS officers and probationers on our rolls at present. We have 30 MBAs plus 9 graduates with Management Sciences including Public Administration, foreign Trade and/ chartered Accountancy; 24 from the Humanities including 11 with Entire Economics, and 8 from the Sciences and Technology (See appendix III). 17 universities from abroad are represented in the TAS today (See appendix IV), 5 TAS officers are from Cambridge, 4 from the LSE; 3 from Oxford; 2 from MIT; 2 from Stamford and one each from the remaining 11 universities abroad. The Indian universities and HTs represented in the TAS total 16; 6 from the ~outh of India; 4 from the West and 3 each from the North and East of India (See appendix IV). Boys from St.Stephen's College usually make a good impression at tile interviews and 8 of them are on our rolls today. Nevertheless, the layman's image of TAS officer with a blue blazer and brass buttons is quite wrong. There is no one type of a Management or Executive Trainee. In a large organisation like Tatas, spanning many aspects of human endeavour, we need, and we look for varied types of human talents. The quiet scholar as well as the extroverted "many-splendoured" executive who thinks that the world rotates because he walks, both are perhaps equally needed! The public school boy is there, as well as those who come in from exceedingly modest financial backgrounds and from varied social strata which cannot be described as under-privileged. Public competition at national level, for the HTs, HMs and other institutions of higher learning have spotted their talent and brought them up. Demand, Future Projection and Policy

The Managing Agency System came to close four years ago. There is a natural tendency for each company to go its own way. Taking a leaf out of TAS, some important Tata Companies have introduced their own Management-Trainee programme. It is therefore, imperative for the TAS to insist on quality and excellence. "Service" is the second plank on which the TAS can take a firm stand. It is primarily a service department. Working on the principle that "the customer is always right", we try to meet the various, and at times conflicting requirements of companies and, as far . as possible, to accommodate their convenience. We have always tried to work on an informal basis through personal contracts, knowing that formal 'directives' are opt to be resented and taken as interference. It is our experience that when people and companies are left to themselves they solve their problems best, from within their own resources. The decisions come from the companies, and rightly so. Therefore, more often than not the TAS Committee is neither seen nor heard in action, which perhaps does not quite mean that we have abdicated our function. The Committee carefully observes, notes, has its ears always to the ground, and is aware of the current problems and trends - but it prefers to work from the wings. This is our strength. We are grateful for our rapport with the companies and it is because of this that up to now there has been little difficulty in absorbing probationers as and when they are ready for placements. It is not uncommon that companies stake their claims in advance, and at times it happens that one probationer, has, as many as three or four claimants (Companies) wanting him, and they bid one against the other at the time of final placements. This should not tempt us to violate the natural law of supply and demand; the supply must always be a shade lower! Not only that, but the entry of large numbers of TAS should never be allowed to block channels of internal promotions.

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With one notable exception, it has been difficult to obtain from the Companies information about their future requirements, and we have not been able to work on Company projections. Instead, we have tried to build up the Cadre, steadily, by taking in as many good entrants as we come across through personal contacts, with the Colleges, Universities, IIMs, Tata Limited and sometImes from the States. In trying to build up the TAS, many problems have been faced and we have yet to face many more. It is not that we are not aware of our limitations and short-falls; we regret that much remains to be done and we are painfully aware of it. "

Apart from on-the-job training and experience, little conscious work has been pout in on the development and career planning of individual officers. Job rotations and Inter-company mobility are restricted, as companies seem to be reluctant to allow their work to be 'disturbed' by losing their own trained men on transfers and development programmes. But it must also be said here that this kind of work can hardly be done in isolation for a small group of people. It requires a serious and a concerted programme in the whole organisation - and we are far from that stage as yet. But there are other aspects which can easily be improved. For instance, a little more personal interest from the company Executives are the appraisal system would be more effective. More frequent meetings of the younger TAS officers with members of the committee on a systematic basis is very desirable as they feel the need of guidance in the early years and they should not feel that they are neglected. A better representation on the committee of the major companies would bring in cross-fertilisation of diverse experience which can be very fruitful and which can give a direction to the future of the TAS. We are grateful to the members of the ACE for their interest in the TAS and for giving us an opportunity of submitting a factual report on our work. Two images of the T AS, one from within the organisation, and the other from an independent survey in a national weekly might be of interest to members of the ACE. At the last AGM of TELCO, in reply to a question about the TAS, the Company Chairman was recorded to say: "We have a very effective Tata Administrative Service. We pick up the choicest people with best qualifications and they are the cream of our staff. All companies have TAS people and we are very proud of that." The second, which gives the public image of the Cadre, comes from a survey of job opportunities in the Illustrated Weekly where the TAS is called the "plum job" of the private sector: "In order of preference, the plum jobs in the private sector are TAS, major oil firms, the bigger commercial enterprises, chartered accountancy and the medical profession, banks, advertising agencies and then public sector giants." Looking to the future, if we are allowed the privilege of continuing to serve the requirements of Tata Companies as one important avenue of recruitment among others for the senior Cadres in the organisation, and to look after our boys, we shall be happy. A time has come when perhaps the smaller companies will need and make more use of TAS officers. Harsh competition and modern trends will necessitate a greater use being made of highly qualified young men which will open further avenues of employment for the TAS. But its greatest strength will be the intangible links of common tradition, of ideals and personal relationships which it can create between Tata Companies, which will contribute its mite in holding the organisation together. The Tata organisation is a precious national asset.

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STAGES OF HUMAN GROWTH GOVT. MEETINGS NATIONAL ASSOCIATIONS INTLMGT CONFERENCE TRADE EXHIBITIONS CHAIRMAN CONFERENCES CHAIRMAN COUNTRY ASSGT. HEADQUARTERS OJTMBA NATIONALINTL CONFERENCES LEADERSHIP BASIC DIRECTOR DIRECTOR MBA TRADE EXHIBITIONS CONFERENCES ROTATIONALOJT BASIC GENERAL MANAGEMENT MBA FACULTY DEVELOPMENT PUBUC SPEAKING PROJECT METHODOTJ ROTATIONAL BASICDIV. MANAGEMENT MBA LEADERSHIP MANAGEMENT OF PEOPLE MANAGEMENT FUNCTIONAL MANAGEMENT ROTATIONAL OJT BASIC MANAGEMENT

GENERAL MANAGER

DIVISIONAL MANAGER

MANAGER REFRESHER BASIC MANAGEMENT OJTHUMAN RELATIONS COMMUNICATION SKILLS LEADERSHIP SKILLS SUPERVISOR UPGRADING REFRESHER ROTATIONS OJT BASIC TECHNIQUE BASIC SKILLS INDUCTION WORKER

I

TRAINING

I

IV STAGE EMPLOYMENT

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DEVELOPMENT

I

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General Patterns and Principles It is clear from the case studies drawn from USA, Japan, Europe, India, Singapore,

Indonesia, Switzerland, etc. that in spite of regional, national, cultural, business and corporate differences, there are several patterns and principles discernible in the practice of human resources development which would assist both the developed and developing nations to invest in people to develop their countries. Firstly, most of the good organisations invest in people for the long haul and they reap a rich harvest over the longer term. Secondly, they have their own management philosophies and principles, developed over a period, which is different from each other. The consistent implementation and practice by all employees in the organisation is the reason attributed by the success and growth of the organisations.

SINGAPORE MODEL SM LEE Addresses Hopes of the Young

Mr. Lee Kuan Yew addressed the hopes and concerns of young Singaporeans in a novel way - by telling the story of how he would relive his life all over again, if he were a young undergraduate today. Speaking to students from the two universities, he related the choices he would make in education, career, marriage, and service to the nation, if he had been born in 1973 instead of 1923. The Senior Minister's speech was filled with personal anecdotes as he related both his past real-life experience and his hypothetical future to illustrate how times had changed, and so too the values and realities of the world. Underlying this was a message to young people: Plan long-term, maximize your natural endowments and seize the many economic opportunities that East Asia offers. As he put it: "My chances were different. A whole world was in a stage of revolution. Empires were being dismantled, empires that crashed in the Japanese Occupation. "You can't start a revolution now. People would think you are mad. So you can't travel my path. But the whole of East Asia is opening up. "This is one enormous big world which is going to be integrated. There are enormous opportunities. And if I were a young man, I would seize them," Speaking on the topic, What if I were a young undergraduate again?, at the National University of Singapore, he said he would choose a career which would give him options. He would aim for an overseas Singapore Armed Forces or overseas merit scholar.ship, as that would' give him a 'passport' he could flash and dash through the door. "Once you are through the door, you are then tested on your merits. But you must get through the door first", he said at the talk organised by the NUS Political Association and Democratic Socialist Club, and the Nanyang Technological University's Current Affairs Society. The scholarship would also give him a network of friends who would one day in key places. He would opt to study engineering, architecture or hard sciences in a top American university, rather than in Britain, followed by an MBA. He would choose America over Britain as the former would have a big role in Asia. If he failed to get an overseas scholarship, he would do law or engineering at NUS, followed by an MBA in America.

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He would also keep up with his language skills in English, Mandarin, Malay and Japanese. After serving his government bond, he would move a statutory board or a government linked company with regional projects. At 28 to 30, he would marry "an equal or somebody better than I am", as she would then be able to carry the load as much as he could. She must also be able to imbue the right values into their children. As to housing, he would start off with a five-room or executive flat, before upgrading five to seven years later. Owr.ing a car, he acknowledged, was harder today. However well-educated a person was, only the top 270,000 people would own one. But he gave the undergraduates some reassurance about the prospects of owning a private house and car. On housing, for example, however high prices were, it would not matter so long as the young became high wage earners. "Because that is what decides who gets there", he said "If you can get into the top 20% of ~age earners, you will get a house." By the time he was about 40, he would set up a partnership in business or start his own company. He would also join the People's Action Party, and be ready to be a minister and contribute to society in his mid-forties because, without a good government, everything would go down the drain. He would stay at least two terms to leave his mark. If he went back to his business, he would remain an MP. Mr. Lee reassured the students that even if he was not in the top 2 or 3 % of his generation, he would not lose heart. "1 won't be discouraged because many of the more successful men in the world never were at the top 2, 3 % of their generation, at least not the scholarship route", he said, adding that Singapore entrepreneur Sim Wong Hoo did not have an MBA. Rounding up, he exhorted his young audience to "maximize your natural endowments, your gifts, the things you do well, and then seize your chances in a given society at a given stage of development." A 'Passport' that You can Flash

1 would want a career which would give me options because you cannot foretell what openings the future will have. So I would go for an SAF overseas scholarship or overseas merit scholarship as the first step. My journalist friends and academic friends tell me - no, that's not what the present generation would go for. They would say the eight-year bond restricted career. They would go for an SIA scholarship or DBS scholarship - more openings. 1 thought about that. No, I think that's short-sighted because what you want in life is a passport you can flash. And I dash through, through the door. Once you are through the door, you are then tested on your merits. But you must get through the door first. And if you taken an SAF scholarship, an overseas merit scholarship, there are one of about 50 each year. Any mirister, any civil servant, any judge, looks through your CV and say: Ah, one of 50 for that year. And the other thing you must have in life is a network of friends, of being part of an old boy network. You have friends in key places and they will rise. Twenty years later, they are in key, strategic positions. All you do is pick up the phone, your name and you'll have them.

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Engineering for a Good Grounding, then on to an MBA

What would I do if I got the scholarship? I think if I were good with my hands I would do Engineering: Not to spend my life on it, but to have a good grounding. And the Japanese have always believed that a good CEO, Chief Executive Officer, must have a real good grounding and understand the factory floor. And Mr. Morita, the man who founded Sony, tells me that's the weakness of the American corporations. They all rise through business schools and they're shuffling papers. But they don't understand how the productive part of the business can be improved. Of course, after that I would want to take an MBA, because you don't want to be an engineer or a researcher in the lab all your life. Going to America: Because the US has a Big Role in Asia

Where would I go? Oxbridge? Born in 73, I would say: no, I would go to America because the americans would have a big role in Asia, and I have to understand the Americans. So, It's not just learning data, it's networking. And if I go for my undergraduate or my first degree there, I would go for an MBA later in Europe. Then I'd understand also the Europeans. Or if I'm good in my Chinese and I pick up some Japanese, I'd spend a year with the Japanese. It's the hard facts of life: Who will be relevant in this part of the world in the next 10,20,30,40 years. There's cultural lag we suffer from. The PSC suffers from it. Parents suffer from it. Many of our students are still benign sent to Oxbridge and top British universities. Club Membership, Holidays Abroad

I'd probably want to be a member of a golf club, to have a swimming pool, a health club. I'd want to have school holidays with my children abroad now. Not just go up to Fraser's Hill 0 Cameron Highlands. People take children to Disney World or Disneyland or whatever, New Zealand, Australia, exotic places in China, in Europe and so on. But in your lifetime you're going to see world-class concerts and plays in Singapore because we're going to put up the facilities for it, and we're on the main trunk route. And whether you're Pavarotti or Placido Domingo or whoever, they have to ravel, because Europe has heard enough of them and everybody's watched them on television. So we are no longer isolated. Medishield Plus, Blue-chip Stocks

I would go in for either comprehensive co-payment or subsidized outpatient scheme, but I would buy myself Medishield Plus. And for my CPF, I will put as much as I can because it's taxfree. I will reach the maximum and put it by and use it to invest wisely and safely in blue-chip stocks. Every time I watch SBC financial reports, all those shares that go up and down every day, you should stay away from. If you think you are smart, you want to gamble. God bless you. But I buy what I know will go up with the economy of Singapore. If you buy a bank, good sound, well-run bank, it is in every business, it's financing every business, if Singapore's economy prospers, it must prosper. Or, you buy a property company, if the economy prospers, the infrastructure improves, property must go up.

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Opportunities would still Abound

Now, what if I were not in the top 2, 3 % of my generation? I will tell you that I would not lose heart, I won't be discouraged because many of the more successful men in the world never were at the top 2, 3 % of their generation, at least not the scholarship route. Henry Ford didn't get an MBA with distinction. Neither did Rockefeller. And Sim Wong Hoo of Creative Technology. He only made polytechnic and he's got a good brain and he's made it. So, what it really means is, can you get advice from your parents, from your uncles, from teachers, from friends, how to maximize your natural endowments, your gifts, the things you do well and then seize our chances in a given society at a given stage of development. My chances were different. A whole world was in a stage of revolution. Empires were being dismantled, empires that crashed in the Japanese Occupation. You can't start a revolution now. People would think you're mad. So you can't travel my path. But the whole of East Asia is opening up. This is one enormous big world is going to be integrated. There are enormous opportunities. And if I were a young man, I would seize them. English First, then Chinese and Malay

I think it's important that you know the English language because it is the International language. And you speak it in the standard form. Do not speak Singlish! If you do, you are the loser. Your interlocutors, when they hear you, their ears go askew. You detract from the message that you're sending them. I don't have to speak with an English upper-class accent. But I speak in a way which makes it easy for them to understand me and therefore they are not distracted by my background. I would learn Chinese. It's a life-long facility which should be of enormous value, economic value. Then I would learn Malay, perhaps the Indonesian pronunciation. We live in this region, therefore, I think it's a value to have it. And HOB Flat, for Starters

My children were fortunate: they had a mother who worked and when they started life they had a home. Not very posh, but comfortable. If I didn't have a father or a mother to give me that, I would start off with a five-room or an HOB executive. Quickly! Before my income ceiling takes me beyond that. You buy a flat in Bishan for $160.000, it's going today for half a million. So I would get there first, stay five years, seven years, and then move out. I'll give you some reassurance about the prospects. Take your time. Don't get too anxious. Whatever asset inflation or scarcity value there is, remember that the private homes in Singapore belong to about the top 12% of wage earners. National Development's plan is: today we have 15% or 120,000 (private) units; by the year 2000, 20% or 208,000 units; and by year 2010, some 23% or 290,000. So let me put it this way: However high they go, it does not matter. Can you get to the top 15%? Or the top 20%. Or the top 23%? That is what decides who gets there. Because rich man's son ,gets house; he hasn't got the earning capabilities; after he lives well, then he has to sell the house, you buy it. It's been like that from time immemorial.

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Cars are Sarcer than Graduates

In 1959, I was wealthy enough, successful enough to buy a Mercedes 2205. But you'll remember, at the time I came back, I was one out of 150 practicing lawyers. Today, there are 2,600 plus lawyers. The number of cars in 1951 was 22,000. The number of cars today has gone up to 300,000-13 times. But lawyers have gone up to 20 times. Now, I think I would wait three to five years after graduation, then I'll buy a Japanese car, maybe 1,300-1,500 cc-that would be not bad. In 1974, my son Hsien Loong came back, graduate. He had to use myoid Mercedes-Benz. In 1980, he bought himself a Honda Civic, 1,300 cc. Then in 1985, he changed to a Toyota Cressida 2,000 cc. My younger son, Hsien Yang, graduated '79. He used his grandfather's Honda Civic because the brother was using my car. He got married in '81 and he bought himself a Ford Laser, 1,300 cc. So with each passing year, cars became smaller and more expensive. That was before CaE's! I put it in a objective way ill this manner. However well-educated you are, remember that only the top 260,000 to 270,000 people own cars-31 % of all households (this was from the 1992/93 household expenditure survey). Houses and cars, which require land, have what is known as 'scarcity value' and what the young now call "asset inflation." When I came out from university I was one out of the top 1% - that's all that made it to university in my generation. When my son, Loong, came back in '74, he was one out of 3.8%. And when my son, Yang, came back in '79 he was one out of 4.5%. Now you are part of 19%. By the time you graduate, you may be part of 21 %. So you see, the scarcity value of graduates goes down the scarcity value of land goes up. A Minister, because the Price is Well Worth Paying

So, what would I do? I think I will catch the eye of some minister. And if I have the right credentials - SAF scholarship, overseas merit scholarship, preferably a first at a top university, an MBA with distinction - they cannot miss me; they have been looking for me. But that only gets you an interview, a tea session. Then we go to know whether you interrelate well, have you got the right social intelligence, have you got the right commitments. Now, born in 1973 without that hardship, the idealism, I think, will still be latent if you've got it. Otherwise you can't explain why people go to Rwanda. You see them on television. They go to Somalia, they go to Bosnia. You know: Medecins San Frontieres, Oxfam, and so on. They are able to find highly intelligent people, well-qualified, driving lorries, catering for the miserable. SIF (Singapore International Foundation) gets people willing to go to Botswana, Nepal, Philippines, do things for other people. We are also tapping that same wellspring of idealism. It is a powerful force for good. Now in, say 2010, 2015, I think I will be ready to be a minister. And probably I would stay a minimum two terms, preferably three terms, to leave my mark. But even if I go back to my own business, I would want to stay on as an MP. This is something which the younger generation does not understand. There are 80 MPs, and in a crisis, everyone counts. But of course, it also means, as the phrase

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goes, "your Sundays are burnt" because that's the time when the constituents want to see you and they are free. But that's life - you pay a price, and I.would think it's a price worth paying. Primary Schools: Not that much of a Difference

Good primary schools give their pupils an advan~age, but they are not as important as good secondary schools, Mr. Lee Kuan Yew said yesterday. Commenting on what he called the 'tremendous commotion' over Primary I places in recent weeks, he said: "Schools are important and good schools give a student an advantage. But kindergartens, primary schools don't make all that much of a difference. ''It is in your formative years in secondary school, and in junior college and in university that it makes a difference." In an apparent reference to calls for better teachers to be posted to neighborhood schools, he said he thought that parents were "running around with wrong preconceptions." lt was not just the teachers that made the school, but the child's fellow students. "The value of being in a good school at an early stage in your life is the picking up of good language habits - from your fellow students. "50 if you come into a classroom full of people who speak good Mandarin or speak good English, you will go home speaking good English or good Mandarin", he said, "Now this is a problem", he added.

Similarly, he said, this was why HUOC blocks just outside HOB estates were more popular than those within. "Why? Because parents want ·their neighbours to have children like their children, so that they feel safe and they pick up the right speech habits and behavioural patterns", he said. With allocation of places by merits having to wait until secondary school admissions, there was no answer to the problem, except to have streaming earlier than Primary 6, he said. One possible solution, however, was to stream students earlier than Primary 6. It could be at Primary 4, he said. "I believe within 18 months or two years, an observant teacher knows which are the fast learners in the class and which are the not-so-fast learners. Then you can make an adjustment in Primary 3." "But teachers are loath to discriminate, principals sympathize with their teachers, and we are left with Primary 6. But if pushed, I think we could make a reshuffle on merits at Primary 4." On the greater importance of secondary school to a student's chances in life, Mr.Lee noted that he himself went to Telok Kurau English School with lots of Malay and Chinese fishermen's children. ''It didn't do me any harm", he sajd. "Headstart programmes may help, but finally it is your natural capacity. "If you are 1,300 cc however higher octane fuel you put in, you're still 1,300 cc. If you are 2,500 cc or 3,000 cc then you can pour low-octane fuel and you still purr. "Of course by the time you are entering the competitive stage, say upper secondary then you want to make sure you've got high-octane fuel." Fair and Logical to give Extra Vote to those who have Children

Senior Minister Lee Kuan Yew said giving those who had children an extra vote was fair and logical because it was consistent with the idea that every human being was entitled to one vote.

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Unlike the old who would not worry about the next generation, those with children would vote in a way that would take into account their children's future, he said. "I can justify the double vote because I'm saying the moment you bring a child into the world, you are voting for yourself and for your child. You cannot just think of yourself. Because you've brought this child into the world, you've got to act in a way that there is a future for this child. "Absolutely sensible, I was trained as a lawyer, so I can find an answer within the ambit of a logic of the system. If the logic is one human being is entitled to one vote. I'll say: yes, so is the child. He said he made the suggestion based on what he had seen in other countries, where the government malfunctioned because well-organised lobbies railroaded policies. Singapore, he noted, would have many old people in 25 years who would insist on having their CPF out by the age of 55. And many would not have made provisions for their next 20 years after that. He predicted that if Singapore went along the same courses as the other countries without any change to the system, the aged would become organised. "You get hold of all the senior citizens' corners, in no time, you've got 20%, 25% of the vote! And free medical health, free this, free that." Productive people would then leave and there would be no one to push the economy forward and pay the taxes. One way to overcome this problem and create a more stable system would be to invest the vote more heavily on those who had to bring up their children. The scheme, he said would repose the future onto a group of people who would be at their most productive economically and their most responsible biologically. "But when you are old and your children have grown up ... it's what they call 'empty nest syndrome' ... the eggs have hatched, the birds have flown, your views change ... "You forget that you've got to worry about the next generation because your children are all grown up." Citing the British experience, he noted that many professionals had left the country because of high taxes to fund welfare benefits. "We are not into that position yet. And my advice to Singapore is: don't ever get into that position. You can't unwind it." He said the problem was not urgent now. "But think about it, because I may not be around to suggest the solutions." "And I do not think it's that illogical, or that unjust. It's completely fair. It goes through for everybody.... The day you bring a child into the world, I give you two votes. And the chances are they will not do foolish things." Unmarried Women Grade: I would have done Things Differently . ...

Mr.Lee Kuan Yew said yesterday that he would have done things differently if he had known graduate women would have problems getting married today. He would have opted for a gradual opening up of the system to women while at the same time re-educating the men and their mothers to make them accepting of educated women as potential spouses and daughters-in-law. He and his colleagues, he said, had been ignorant when they took over government in 1959. "We thought we would open up the whole system, give equal opportunities for education and jobs and we would become like the West. "But we forgot that culture does not change rapidly. Culture goes with mother's milk. Your mother implants ideas in you. So you want to be the boss in your family. You don't want a wife who is smarter than you and earning more than you."

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He said that the Japanese had worked around this problem without affecting their economy. Their smart women were sent to finishing colleges where they learnt tough subjects, such as economics, and learnt to be good counterparts to their husbands. But they did not threaten Japanese males because they studied in 'finishing colleges: Entry for women to universities was also restricted to 10% and gradually increased to 20'}"0. Eventually, I think the Japanese male will change in his attitudes and the problem will be solved", he said. Taiwan too faced the same problem as Singapore because it opened up quickly and now had many unmarried women graduates. "But this having been done, you can't unscramble the egg. So, all you've got to do is to re-educate the males." The consequence of having unmarried educated women was that the demographic quality of the population would soon suffer. "In the next generation, you are going to find less sparklers". He said statistics showed that children of graduate mothers and fathers predominated in the top 10% of PSLE, 0 and A levels examinations. Replying to another question on what he would do if he were a female undergraduate, he made everyone laugh when he said. "It is an impossibility for me. But I will try and ... fantasize.If I were a young undergraduate at 21, I would know, reading statistics, that the Singaporean male is a duffer, a fool." The male was a product of an outmoded set of values which made him want to marry his subordinates. But there had been some improvement, he said, since he first brought up the problem in 1983. Only 37% of graduate men married graduate women then, compared to 59% today. But this meant that the remaining 41 % of women were either marrying down or staying single. Thus, his advice: "I would therefore not waste my time. If I'm a girl, I would set out quietly and assess the market." Educated women should not rule out marrying down and they should be realistic, he said. "I think, don't set your sights too high. Statistically your chances are six out of 10, however hard you try." Noting that the problem would take a long time to solve, he urged his young audience to re-adjust their thinking and be realistic about choosing a partner. He told this story about how his wife had given advice on this matter: "She once told me that one of her nieces thanked her for her advice. She was a graduate. A young man came along who wasn't one, but he was a good marketing man, reasonable, presentable, he's got good manners, and he's made a good match and they are happy." School for Leadership

Eight out of the 14 ministers in today's Cabinet took the scholars' path. Four out of the 12 Ministers in the 1985 Cabinet did so. And in 1975, two out of 14 were former Government scholars. The pool of young men who study overseas on Government scholarships, and return to serve in the civil service or armed forces, has been fertile ground from which to recruit Cabinet Ministers, and more so in recent times. It was a route that Senior Minister Lee Kuan Yew endorsed recently, when he spelt out how he would re-live his life, were he a young man today. Speaking to undergraduates at the National University of Singapore, he said he would opt for a Singapore Armed Forces (SAF) or Overseas Merit Scholarship (OMS) to study at a top American university, followed by a career in the SAF or civil service and a stint in one

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of the statutory boards or government-linked companies. Then, he would enter politics and serve as a minister for two or three terms. This is the path his two sons have taken - Brigadier-General (NS) Lee Hsien Loong, now Deputy Prime Minister, and BG (NS) Lee Hsien Yang, who is now Telecom's President. And so have more than 800 others since independence. They represent the top 2 to 3% of each cohort. Among them, about 40 to 50 out of 50,000 students will win the most prestigious OMS or SAF scholarship. To be sure, technically trained, bright young men have always played a key role in Singapore's development, even in its early formative years. Dr. Goh Keng Swee, who was a top student at the London School of Economics, Mr. Hon Sui Sen, an alumnus of Raffles College in Singapore, and Mr. Howe Yoon Chong who studied at the University of Malaya in Singapore, were the pioneers of their time. As the years went by their number mushroomed because the number of scholarships awarded has increased and because of the increasing attraction of a public sector career. Today, 12 of the 17 permanent secretaries are former government scholars. Within the elite Administrative Service, 13';Fout of its 210 officers are overseas scholars. Three out of four who join the service each year are overseas scholars. The induction of the top talent into the political arena has, however, picked up speed only recently. The Cabinet had few scholar-bureaucrats in its midst in the 1960s and 1970s. But from the 1980s, many of those who became ministers, were former overseas scholars on the Colombo Plan, SAF or President's scholarships - such as DPM Lee Hsien Loong, Mr. Yeo Cheow Tong, Dr. Lee Boon Yang, Mr. Lee Yock Suan and Mr. Mah Bow Tan. More recently, Brig-Gen (NS) George Yeo and Mr. Lim Hng Kiang, both SAF scholars, became ministers shortly after becoming MPs in 1988 and 1991 respectively. In the wings is Rear Admiral (NS) Teo Chee Hean, elected in the 1992 Marine Parade GRC by-election, and now Minister of State (Finance and Defence). If there is a comprehensive Singapore system for grooming political leaders from a young age, this is it. Why has this come about? What is about the civil servant or SAF scholar that makes him a more likely candidate than his private sector counterpart for ministership? What are the implications of such a selection process? Elitist, Yes, but also Effective

One obvious reason is that the public sector has hogged Singapore's small talent pool with the Colombo Plan, and later the OMS and SAF scholarships. There is probably a greater concentration of First Class Honours graduates in the Administrative Service than in any private sector company. It is not surprising therefore that the PAP leadership, which has made meritocracy its trademark, should recruit from the best and the brightest. Some people believe that those who were originally attracted to government scholarships and a public sector career are by natu{e and temperament more inclined to continue their career in the public arena, and that politics would be a natural extension of that. Some of them would also want to repay the debt that they feel they owe to the government for having given them the financial support in the first place. Indeed, Prime Minister Goh Chok Tong revealed in 1989 that this was what moved him to agree to enter politics when he was asked to in 1976.

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Said Mr. Goh : "I had gone through my upper secondary school and the university on a Government bursary. I had done well in life. lowed much of it to the Government we had. I just could not say 'no'." Because of the role ministers play in policy-formulation in Singapore, they are expected to be able to have as good a grasp of the technical details of the policies they administer, as top civil servants. In other words, for a top civil servant, being a minister is almost like the next most natural career move. The typical fast-tract career path of the OMS or SAF scholar gives him excellent training to run a ministry, so that stepping into the ministers' shoes is a "natural extension" of public service, as one scholar puts it. If he is inducted into politics in his mid-30s, after eight years in the SAF or Administrative Service, followed by a spell in a government-linked corporation, he would have had experience in directing several departments, put up proposals that shape Cabinet decisions, helped implement policies himself, and managed a company. In contrast, a top a private-sector CEO would have had to make a more drastic adjustment to the culture of the public sector bureaucracy, and so may be less inclined to want to try the unknown. There are thus many good reasons for the Cabinet to be made up of ex-government scholars. But there are also concerns that this might lead to a particular mindset. NMP Walter Woon argues that ex-civil servant ministers will tend to look at issues like developing regional enterprises from the regulator'S point of view, rather than the entrepreneurs'. Political science lecturer Bilveer Singh argues that former army officers may carryover their preoccupations with security and defence issues into the Cabinet, and be more sympathetic, say to allocating more resources to these areas. As like begets like, so a Cabinet made up of scholars will tend to hand pick others like themselves, and miss out on the benefits of what Braddell Heights MP Goh Choon Kang, describes as "cross-fertilization." This may in turn deter others of a different mould from becoming ministers. One academic who did not wish to be named, goes further in saying that working-class Government scholars who become ministers, may become too conservative. He says: "These are people who, having risen through the system, don't want to rock the boat. So they would be conservative in their policies and would not be innovative enough." But political science lecturer Shee Poon Kim disagrees with these sentiments. He says the bureaucratic elite, regardless of who their parents are, are the best people to lead the nation into the .future because of their ability. He adds though that the political mettle of the younger leaders in times of crisis is still untested. Nor should bureaucrats be typecast as conservative and inflexible, he notes pointing to people like Keppel Corporation chairman Sim Kee Boon who have switched from managing public policy to running big government-linked corporations with success. On the danger that a Cabinet made up of many former civil servants might look at policies from a narrower perspective, Dr. Shee says that resource constraints in Singapore means there are few real alternatives to major policies anyway. Having many scholars and former civil servants within the Cabinet does not make it a homogeneous one, he argues. Cabinet ministers do have their own distinct

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personalities and styles. Indeed one could point out the many differences in personalities and temperament, perhaps even ideological inclinations among the various scholar ministers. One example: Many would agree that DPM Lee Hsien Loong and Health and Information and the Arts Minister George Yeo, both SAF scholars of brigadier-general rank educated at Cambridge University, come across quite differently in their speeches. From his speeches, some have even labelled BG Yeo a liberal. While BG Lee usually comes across as a more hard-line politician. The same argument could conceivably be made about many of the other ministers. But should more be done to recruit ministers from outside scholars circle? Two PAP MPs - Mr. Goh Choon Kang and Dr. Tan Cheng Bock (Ayer Rajah) say the PAP could search for potential ministers among its party base, especially its crop of young graduates in Young PAP. Both say they are content right now with their work as MPs. But they add that part politicians with the ability but not the scholarship pedigree, should not be barred from becoming ministers. Like others interviewed, they did not think that ministers will be picked only from among scholars in future. As NMP Mr. Woon pits it: "If you are a scholar, the door is open. If you are not, yop have to push the door open yourself. But you can still get through". But one scholar-bureaucrat was sceptical that candidates of ministerial caliber could be thrown up by such grassroots politics. "He may be a token minister, appointed to prove that the Cabinet is not elitist." Mr. Goh Choon Kang suggest that NMPs who prove themselves by appointed ministers for technical portfolios such as Finance. But Mr. Woon, whom some have said publicly is of ministerial caliber says NMPs should not co-opted into the Government as they should remain non-partisan. Even if ministers are recruited from other sources, it is likely that government scholars will remain the dominant source for at least the next decade or two. As Dr. Bilveer Singh puts it: "Already, the dominant group is the "scholar group" and it would appear that the leadership has decided that this should be it." In the end, though, what matters above everything else, including the selection process is whether the Government, whether made of scholars or army generals, can deliver the goods. And delivering the goods means also keeping in close touch with the aspiration of the common man and making the good life possible for him. In this regard the scholar Cabinet of the Singapore Government can look back with some satisfaction. While its share of votes has slipped in the last decade, the PAP Government has also been returned in every General Election since 1959. Even if there are some who say it is elitist, it has succeeded in good measure, and that ordinary Singaporeans have benefitted from its poliCies. Ultimately it is the people - ordinary Singaporeans - who will decide, through the ballot box, whether the government has done a good job and if they are comfortable with its make-up. Wanted: More Unconventional, Private-sector Minds in Cabinet

Senior Minister Lee Kuan Yew's assessment of the present Cabinet: it has a general average IQ level that is higher than its predecessor, but the Old Guard team had people with original minds.

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"My worry is that they don't have enough unconventional minds", he told Insight. "You know, people like Rajaratnam who looked at things in an unconventional way. I mean, he can tum an egg upside down and write an article on it. "You must have that to be able to approach a problem in a new direction and see it in a new light." His first Old Guard team was of a different breed: they were sceptical people who queried each other's propositions. "I had people with drive, vision and a sense of enterprise, a sense of adventure that we have to create something new, especially after 1965", he said. After 1965 : that was the year Singapore was booted out of Malaysia and sceptics were saying that it could not possibly survive on its own, a puny city-state of barely two million people with no natural resources. As Mr. Lee put it: "Now, we were by ourselves. Confrontation from Indonesia, economy cut off from them. We had to think from scratch, how do we make a living? Then we decided to leapfrog to Europe, to America." The strategy was to attract multinational companies to Singapore and take advantage of their capital and technology, but most important, their ready markets in Europe and America. And whom did Mr. Lee have to carry this out? It was, in his words, a talented team. "Without Dr. Goh, without Hon Sui Sen, without that team, and that team was a talented team, it included Dhanabalan, Joe Pillay, Hon Sui Sen, Howe Yoon Chong, Sim Kee Boon, it could not have been done." It was no fault of the Prime Minister who was trying his best to get private sector people into politics, he added. In fact, PM Goh had already approached three or four of them. Also circumstances had changed, Mr. Lee said, noting that if he were a young man all over again and did not go through the same generation, were now in the 20s and 30s faced with this, we would not have become as resolute, determined and bloody-minded when we pursue our objectives:' This need for a mixed Cabinet and the willingness and dare to buck c9nventional wisdom and try out unorthodox ideas were themes the SM touched on in his speeeh in Parliament last Tuesday. The Singapore Cabinet was already experiencing a dearth of top private-sector talent, being dominated increasingly by former public sector men. In the last 14 years, only four ministers had been recruited from the private sector - Dr. Tony Tan from OCBC, Dr. Yeo Ning Hong from Beechams, Mr. Wong Kan Seng from Hewlett Packard and Mr. Yeo Cheow Tong from Le Blond. Both Mr. Wrong and Mr. Yeo were, in fact, former civil servants. Dr. Tan and Dr. Yeo have since left the Cabinet. Mr. Lee gave these examples to counter criticisms of the White Paper aimed at paying ministers at top civil servants salaries pegged to top private sector earners. The criticisms had centered on the fact that ministers were already well-paid and that pay was not the most important factor in attracting people to politics. PM Goh in his speech last Thursday also referred to the shortage of ministers with private-sector experience in the Cabinet, noting that in the last few years, recruitment from the public sector source had, in fact, narrowed down to the Singapore Armed Forces. Deputy Prime Minister Lee Hsien Loong, Ministers George Yeo and Lim Hng Kiang and Minister of State Teo Chee Hean were former SAF men. Besides the difficulty of attracting people from a booming private sector, there was another factor which made politics less attractive now. As Mr. Lee said on Tuesday, the Government's task was no longer seen in heroic terms: transforming squatter huts to high-rise buildings or from riots to peace and

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plenty. It had to do "fine-tuning" dealing with more mundane issues such as COE prices, and cater to an unappreciative and demanding electorate. "It is not heroic. But without the same capacity to innovate, I think we will come to brief", he said. First Old Guard versus Second Generation

But what are the consequences of having ministers from the same background in Cabinet? And has this phenomenon manifested itself in practical ways. Explaining his worry, Mr. Lee told Insight that having like-minded people in Cabinet would lead to a sort of "intellectual in-breeding" - the tendency to view issues from a certain angle. "You will not see the possibilities that in fact, may exist. I mean they all assume ... given this data, therefore this", he said. Let's not waste time arguing whether there are other possibilities because they have been trained by logical thinking and by their experience, to conclude that, given these facts, these are the only, the likely conclusions. He referred to his first Cabinet, which had people who were "prepared to peel an onion, and then see whether inside there are layers upon layers, or maybe there is a seed inside." So when they reached a decision to act, they were well-appraised of all the things that could go wrong. Turning to the workings of the present Cabinet, he said that the younger ministers would have a discussion among themselves before the formal session in which he would take part. These pre-Cabinet meetings, which were instituted in the days when Mr. Lee was PM, were usually held over lunch by the younger ministers to discuss their position prior to the formal meeting. "I give my views after they have all met and discussed it. When I take the contrary view, I am pitting myself agamst the majority." Mr. Lee said, "1 don't know how they are divided amongst themselves but it does not bother me. I say, look, this is what I think, you better look at it again. "But my feeling is, if they had different backgrounds, different experiences, they would be questioning and they would be wanting to achieve targets which they now almost ignore or assume are non-existent, which I think is not a good idea, is not a good think." Asked to give examples when he saw such "blind spots" manifested in the present Cabinet, he recalled that he had raised the idea of building underground roads to satisfy Singaporeans' craving for cars. He did not think the idea would have surfaced otherwise, as the instinctive reactior. of public sector-trained ministers would be to rule out the option as uneconomic, given the enormous cost of digging underground tunnels. "But my argument is this: what is economic and what is uneconomic as against the desires and satisfactions otour population? Can you tell the other chap that his satisfaction is wrong? I mean if he is getting satisfaction out of opium or cocaine, you can say, look, on health ground, I rule that out. "But if he gets so much joy driving his own car, and it does nobody any harm, he's underground most of the time, then I would say, give it to him. Just dig it up. "Now, if they were businessmen, I don't think they would think that way. They will say, "Well, okay, you give me a franchise, I'll run this tunnel, I'll see whether it's workable." Would the second-generation leaders have initiated the move to build an external wing to the economy, which he started? "Somebody may have talked about it as things

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became worse. I mean, there will be signs, flashing amber lights that something is going wrong". The present Cabinet did not see the changes sweeping the region, partly because they were too preoccupied with satisfying voters' demands, he noted. Eddie Barker Example

When Mr. Lee spoke in Parliament last Tuesday on the need for private-sector minds in Cabinet, he gave the example of Mr. Lim Kim San, who planned and executed Singapore's housing policy. Mr. Lim was not one for making speeches, but he had a lively, practical mind. "It is important for the PM to find younger-generation Lim Kim Sans, people with different backgrounds who will sit down, cross-fertilize ideas, improve and sometimes block a plan which is theoretically marvellous but will not work out in practice", he had said. "It has a leavening effect. You need people with different backgrounds."

He gave Insight another example of a private-sector man in his Cabinet: Mr. Eddie Barker, whom he appointed Law Minister because of his practical experience in the field. " As a minister he will know that if you take this case to court, these are all the possibilities that could happen." But would it be possible now to lure a top lawyer in private practice who could be earning $1 million a year into politics and the Government for $600,000 a year? He said that Mr. Barker joined politics, because of a sense of emergency. He had wanted to quit politics in 1972, because his mortgage was not paid up. His salary was raised and he was persuaded to stay. So he stayed on until 1988, which I think was a bit unkind to him. He missed - the boom years, by the time he went back, he was too old, too set and too tired to really go back to the law. Mr Lee added that he would not be surprised if the two PAP lawyer MPs, Mr. Davinder Singh and Mr. K. ShaJUllugam, were in the "million dollar range." Would they agree to be ministers? "Maybe later on, and maybe for just for half a term or one term ... and then I go back. It is a different generation." lf he was a young man all over again, he too would just remain a lawyer, earn big bucks, go travelling, rather than become a politician. The Government found Professor 5 Jayakumar from the university law faculty which he headed. It could, of course, turn to academia again for a law minister, like law professor and NMP Walter Woon. "Yes, he is good, he is rational, logical. But big lapses, big gag in his total exposure of experience", he said. "50 you must get the same quality of minds but exposed to different situations, different mindsets, different ways of thinking and then tackle the same problem. "Then you have avenues open up insights which you never thought were there."

The Lee Model is one of merit-technocracy, where you would groom the very best to take over the reigns of leadership. Suppose you were not that brilliant, and perhaps could it go to school or succeed in school, is it the end of the world for you? May be or may be not. Mr. Matsushita could not study beyond the age of 9. Mr. Bill Gates, the founder of Microsoft, who dropped out of Harvard after a couple of years, went on to become currently the richest man in America by building a global software empire.

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Mr. 1-10 Kwang Ping, the President of Wah Chang International Corp (S) Pte Ltd, spoke to the Foreign Correspond~nts Club on February 25, '94 on the subject of making