Monday, March 22, 2010

Reflections on the “Responsible Manager”

By Olu Akanmu

Management guru C.K Prahalad published a short article titled “The Responsible Manager” on page 36 of the January-February , 2010 edition of the Harvard Business Review. The article is a “Collectors item”. It is short and easy to read. I recommend it strongly. Prahalad says that over the last 33 years, he has ended his MBA and executive education courses by sharing his perspectives on how managers can be “responsible”. He says he has had no reason to change the note year after year. The subject of the “responsible manager” has never been more relevant than now, when corporations and its managers have lost public trust. Many corporations in Nigeria over the last three years have destroyed shareholder value, measured by the massive collapse of share prices on the Nigeria Stock Exchange. Managers are not “trusted” anymore by their shareholders and even their subordinates. The level of cynicism among employees towards their managers and their leaders have perhaps never been this high. If managers can’t be trusted, if they are perceived not to be “responsible”, they do not have a moral basis to lead their people and their organizations. They are definitely sub-optimizing performance because they cannot mobilize fully, the collective energy and the heart and soul of their people.
Prahalad identifies in his article, eleven ways that managers could become ‘responsible”. These are as follows.

1) Understand the importance of non-conformity. Leadership is about change, hope and the future. Leaders have to venture into uncharted territories and must be able to handle intellectual solitude and ambiguity.
2) Display a commitment to learning and develop yourself
3) Put personal performance in perspective. Humility in success and courage in failure are the hallmarks of a good leader.
4) Invest in developing other people. Be unstinting in helping your colleagues realize their full potential.
5) Learn to relate to those who are less fortunate. Good leaders are inclusive, even though that is not easy.
6) Be concerned about due process. People seek fairness not favours. They often don’t mind if decisions don’t go their way as long as the process is fair and transparent.
7) Realize the importance of loyalty to the organization, profession, community, society and above all the family.
8) Assume responsibility for outcomes as well as for the process and people will work with you. How you achieve results will shape the kind of person you are.
9) Remember you are part of a privileged few. That is your strength and also the cross you carry. Balance achievement with compassion and learning with understanding.
10) Expect to be judged by what you do and how well you do it-not by what you say you want to do. The bias for action must be balanced by empathy and caring for other people.
11) Be conscious of the part you play. Be concerned about the poor and the disabled; accept human weakness, laugh at yourself and avoid the temptation to play GOD. Leadership is about self-awareness, recognizing your failing, and developing modesty, humility and humanity.

I like to add a 12th one which I learnt from Steve Covey’s “7 Habbits of Highly Effective People”
12) Have a “mentality of abundance” in your relationships with your colleagues. This will help you to professionally put the organization and the greater good of all above your self-interest. The world is full of boundless opportunities and platforms to create and make a difference. There are no ultimate platforms or positions. You only need to be creative to see another one to stand and make the difference that you seek.

These are indeed humbling times that call for deep introspection for professional managers. We are learning even more clearly that technical competence enough do not make great managers. Values and good personal ethics are fundamental. Perhaps, Prahalad’s 8th point above is most critical for our managers in Nigeria today. The result that we get cannot be divorced from the process of getting the result. The appreciation of this will make our managers more ethical and make our organizations reward both results and behavior. For so long, we have rewarded results and performance with little attention to behavior. A dominating management paradigm among Nigeria managers in the recent times has been “Effort is nothing; result is everything”. This is echoed in every business review session with the most brutal sentiments that has become the culture of our high performance service industry. This paradigm over time tended to have become “Behaviour is nothing, result is everything”. Anything, any method tended to be good enough if it produces result especially in the race to win and annihilate competition. We have made bad behavior thrive. And organizations where bad behavior thrives are ultimately weak and can never realize its full corporate potential. And if corporations are social institutions endowed with privileged obligations to society, managers have a responsibility to manage them much better by behaving better. Our managers must therefore become more” responsible”.

C.K. Prahalad died on the 16th of April, this year in San Diego, United States at the age of 68. The global business community and its thought leaders will miss him. It is said that if there was a Nobel Prize in management, C.K. Prahalad would have won one. He was the co-author of the famous Strategy classic “Competing for the Future” where with Gary Hamel; he developed the theory of the Core Competence of the Corporation. They showed that the key to future industry leadership is to develop an independent view of tomorrow’s opportunities and develop unique un-generic capabilities to exploit them. Every sentence in “Competing for the Future” is a management quote. There are not many books like it. Perhaps, Prahalad’s most controversial book was the “The Fortune at the Bottom of the Pyramid” published in 2006. In this classic, Prahalad advocated that the business world especially the Multi-national Corporations will be irresponsible if it continues to serve only 30% of world population with the assumption that the rest of the 70% of world population cannot be profitably served. In a period where growth has become flat or even declined in the first world, if the expectations and trajectory of growth seen in business over the last three decades are to be maintained, the business world must take a more critical look at the opportunities in the huge underserved populations in developing countries with a view to finding the radical business model that will unlock the potentials of these four billion people. He pointed to emerging and entrepreneurial businesses in the third world that, through a combination of innovative technologies, some of which were borrowed from the first world but adapted cost effectively to developing country consumer context, through innovative value engineering, are serving the third world markets profitably. These businesses along with building scale that compensates for the low margin of third world consumer, affordable packaging units, low cost distribution channel that improve access to product and services to previously underserved segments and strong consumer education, have unlocked and profit potentials of market segments that were previously ignored by the MNCs. Example of these companies include the Bharti in the telecom industry who are very profitable at half the price charged to telecom consumers in other markets. Tata of India has also developed a low price car at less than USD 3000, opening up a new car segment for the global auto industry. ICICI of India became the biggest retail banking franchise in India, outgunning the international banks on the basis of this business model. Unilever India has adapted its business model to this emerging market context, to maintain its leadership of the consumer goods industry in India, leveraging its India experience across several emerging markets. These companies are not only making profit in these previously ignored markets but they are impacting positively on the quality of life of their people. The business world will forever remember this altruistic wake-up call from Professor Prahalad. May his soul rest in peace.

Olu Akanmu
March 2010.


KOB said...

This indeed is a "collectors item" and it infact reminds me of a presentation made by Dr. Kolade titled "The Generation for Transformation" where the Managers of today were admonished to prepare to do what is required in achieving our collective desires of better tomorrow. I agree in totality with the "11 plus 1" principles of a responsible manager which I readily align with the '3 pillars of personal performance' Dr. Kolade presented and they are Standards, Discipline, Beliefs/Values.

We must all develop the moral courage to do what one knows to be right, even when it does not promote immediate advantage.

Ay. B said...

Indeed, the points ring true, right from C.K Prahalad's very first point on the substance of non conformity which cannot be over emphasized in the Nigerian context; where Managers very easily align with the machineries & policies of popular leadership in the absence of depth and even confidence in the proposed system to the 11th point on the importance of Managers being conscious of the part they play. Prahalad's 11th point warns managers of the danger of playing God and the need to accept human weaknesses; both critical virtues most of today’s Managers lack; hence ineffective leadership and a lack of direction for the flock. Most fascinating is Mr Olu’s 12 point on the mentality of abundance…. a real cracker this one. This mentality will ultimately create the wealth of perspective required for a Responsible leader to stay selfless, fair and mostly just when taking corporate decisions.

Furthermore; I fear yet another matter to be a critical virtue whose lack has mostly resulted in the absence of responsibility amongst Nigerian Managers... “The fear of Selfless Action”. Most Managers in corporate Nigeria have not failed out of lack of knowledge or deficient access to information. Most of our managers know exactly what the virtues of good managers should be and have sometimes even displayed them at times when the prices of such actions were not dear; perhaps convenient. The real test however is the resolve to stay true to responsibility even when the cost of Selfless action is dear. Most times, Nigerian managers shy away from responsibility at the expense of the loyalty & trust of followership; a far more expensive and irreplaceable loss.

adrian_w said...

In Nigeria today it is critical to differentiate between management and leadership.

Management is about achieving results. These can be quantitative or qualitative, individual or group. Cynicism towards managers is everywhere because of the lack of authenticity in achieving those results. The insiders "know".

But leadership is something different. No leader exists without followers. That is to say, "followship" is a condition precendent for "leadership". a manager can stand up and exclaim "I am the leader". But if no one follows, the leadership does not exist.

It is well to remember that the 11 or 12 points outlined in Olu Akanmu's blog are about responsible leaders not necessarily responsible managers.

I do not think I am a particularly good manager, despite what some people may think or say.

But I do truly believe that by accident or design, I focused on the types of behaviour and activity that C.K. Prahalad has outlined. I have never seen it listed as 11 points before.

But I can see certain hunches I had, things that occupied my mind, matters to which I devoted my attention, and fights with "upper management" that I fought, which resonate so well to the Prahad list.

We are all here for such a very short career span. the question for which I always wanted a solution is: "how can I help someone today?"

Regards Adrian Wood

Ari Chester said...

This article reminds me of some principles that Aristotle described as charactersizing the 'Great Souled Man', especially from Prahalad's article points #5 (relate to those less fortunate) and #9 (remember you are part of privileged few). Aristotle describes a type of human who is a leader and who is very successful and very proud, but at the same time, who is humble and does not look down on any other human (e.g., being 'courteous towards those of moderate station')... there is a delicate balance here in which the leader is confident, bold, and ambitious, yet at the same time, a responsible, respectable human; here's a quick excerpt:

ARISTOTLE, from Nichomean Ethics (IV,3):

A person is thought to be GREAT-SOULED if he claims much and deserves much. He that claims less than he deserves is small-souled.

The great-souled man is justified in despising other people, for his estimates are correct; but most proud men have no good ground for their pride.

He does not run into trifling dangers, nor is he fond of danger, because he honors few things; but he will face great dangers, and when he is in danger he is unsparing of his life.

He is fond of conferring benefits, but ashamed to receive them, because the former is a mark of superiority and the latter of inferiority.

It is also characteristic of the great-souled man never to ask help from others, or only with reluctance, but to render aid willingly.

He is haughty towards men of position and fortune, but courteous towards those of moderate station.

It is characteristic of the great-souled man not to aim at the things commonly held in honor, or the things in which others excel; to be sluggish and to hold back, except where great honor or great work is at stake, and to be a man of few deeds, but of great and notable ones.

He must be open both in love and in hate, since concealment shows timidity; and care more for the truth than for what people will think.

He must be unable to make his life revolve around another person.

He is not given to admiration, for nothing to him is great.

He is outspoken and frank, except when speaking with ironical self-depreciation, as he does to common people.

He does not bear a grudge, for it is not a mark of greatness of soul to recall things against people, especially the wrongs they have done you, but rather to overlook them.

He is not given to speaking evil himself, even of his enemies, except when he deliberately intends to give offence.

He will possess beautiful and profitless things, rather than useful and profitable ones.

A slow step is thought proper to the great-souled man, and a deep voice; for the man who takes few things seriously is not likely to be hurried, nor the man who thinks nothing great to be excited.