Reproduced from a memorable Interview of Mr. K.V. Kamath conducted by Ms. Shireen Bhan, CNBC TV18 for “Speak For Smiles”, a series of interactions with eminent personalities of India Inc. at Welingkar Institute of Management Development & Research in Mumbai. The guests choose to donate the proceeds of the function to their chosen cause for charity via Toofles Foundation.Some of the insights shared by Mr. K.V. Kamath during his initial interaction with Ms. Shireen Bhan – The statements would be in first person as delivered by him:
• It is certainly not important to be academically on top of the class.
• Leadership comes from across the class.
• I was never in the top 5% of the class.
• Nowadays, some of us have a fetish for data. It is however, not the data but the analytics that is more important.
• Debunking of pre set beliefs is critical
• Academic world needs to revisit the curriculum.
Eg: We studied trigonometry – never used in real life scenarios. But subjects like anthropology should be included in the system as it is greatly relevant across streams today.
• Young managers should guard against making “Mercenary Decisions”
Eg: My move from ICICI to Asian Development Bank
• Things that the young students / managers must keep in mind before changing jobs:
1. How well will I be able to leverage what I have learnt?
2. Leveraging skill sets should be the single most important agenda
3. What are the economic returns?
4. Where will this take me?
• Unlike what some B School students think, career charting doesn’t probably work that early on. You must keep 5 year targets (Personal 5 year plans).
• In early 30’s question yourself where do you see yourself by 40 everything then can be mapped.
Q - Biggest challenge is the transition from the B – School to the real world.
A – Need to realise the relevance of what is taught to what is relevant. At this stage “Unlearning” is critical. Analysis is not the only factor for decision making.
Gut Decisions are very important. By Gut Decision I don’t mean, a baseless decision. It means not overanalysing.
Process of Gut Decision Making:
1. Collection of relevant facts
2. Analysing available facts
3. You digest those facts and reach a perception
4. Hidden persuaders are at work – listen to them
5. Softer issues need to be taken into consideration too
• When just out of the B – School, young managers over zealously want to change their entire organisation. Change is very difficult. You can’t be driving change. Atrophy sets in.
• Atrophy and no change (stagnation) go hand in hand.
• Standardization is extremely important in organisations.
• No same style presentation. Different font size, colour schemes etc are key.
Q - How did you manage change – Making ICICI computer savvy?
A – • Golden Handshake – get rid of the people who are a detriment to your change. Structures and people, who cannot adapt to change, need to be weeded out.
• People, Structure & Processes – All need to change
• “Organisational Structure Change is worst than a root canal”
• Interesting Gut Decision: Eg – Madhavi Puri Buch came one day and said we have only 150 branches. Long lines to deposit cash. How can we avoid this?
Her solution was, Let’s give our customers envelopes. They can put money in it, drop it with a person in charge and get it stamped by the collecting authority – Convenience. KVK completely against it. Security issues. How do we tally if the customer hasn’t lied to us – claim to have deposited more, actual money less. Litigation issues etc. Madhavi was confident. Backed her.
Took gut decision, it worked wonders. It became a runaway success. Then the whole process was adopted by all banks across.
Q - What has been your biggest learning in your illustrious career?
A – 1. You must choose your mentor carefully – Initial grounding very important
2. Technology – Ability to integrate & leverage technology for business
3. Sensitivity to societal changes – India moving from $1000 per capita income to $2000 per capita. We need to study how China made that journey. There are great learnings there.
Q – India playing catch up to China we’re at 8.5% GDP growth what are your views?
A – There was never a better time to be born in India.
• We’re doubling our per capital incomes every 6 years
• I don’t believe much in the GDP figures that are spoken about. Let’s assume:
GDP (9%) + Unaccounted Growth (2%)
How else can you justify automobile sales growth of 25% YOY in a 9% growing economy?
Q – What are your views on “Succession Planning” – Eg: Tata’s
A – • It should be a well thought out process
• Nurture & give opportunity to your people
• They leave because of perceived better opportunity
• When they leave, instead of ill – will, give them a pat on their back and say thanks for your contribution. They’ll never forget you.
• “Flipside of challenge is opportunity”
• Several cases where senior executives find themselves hitting the glass ceiling. All positions are blocked, what do I do?
• Corporate scenario is like a carom board. In a given structure everything is set, but you do not know what moves where, great learning there. Movement of people opens up the carom board. Understand the talent pool, when people move, others get opportunity. “People moving never bothers me” only because I know I have a back up team.
Q – What are your views on women joining the BODs?
A – Investors are certainly happy. It should be on merit. It should not be forced upon just because someone is of a certain gender. Merit should find its own place. Having said that, there is no job that a woman can’t do today. We must realise that we as a society are still not at equilibrium. It will improve dramatically in future.
Q – What have been some of your most difficult decisions?
A – • Technology based decisions – No precedent available. We used mainframe servers, 10% of the cost at that time 10 – 12 years ago no-one used them at that time.
• Moving from a project finance company to a retail company – Large consulting firm advised us against it. We observed that per capita incomes were moving from $500 to $1000. Insight – People need consumer credit – there was a huge vacant space – we spotted the opportunity. BOD support + ability to execute. You need execution ability.
Q – Is it lonely at the top?
Q – What are your views on CSR? Do you think it should be made mandatory?
A – Society has a fabric. Keeping the greater good in mind is important for the survival of the business in the long run. You must listen to your conscience – create win win situations. Maximise everyone’s interests. No need to make CSR mandatory as it is gathering momentum on its own. We need to create an enabling environment.
Q - Formula 1 Racing & business – relationship?
A – • Speed is important in both. You need to drive at your optimum speed but you cannot go just beyond. If you do, you’re going to have a really bad fall.
• Pit stops are the best example of what can all can be done in 4 seconds. It should be a benchmark for further innovations. It is unimaginable what optimum team work can achieve.
Q – Who are the leaders who have inspired you?
A – Jack Welch & Dhirubhai Ambani (approach to opportunities was interesting)
“When you change orbits, it always creates friction”
Q – Family run businesses and succession planning?
A – • Introspection by the companies is a must
• At least 3 levels of leadership pipeline should be created
• 2 leaders should be available for each position
• At the top – people should have atleast 10 years of a clear run. Ideal is 15.
• Outsiders can advise – end of the day, it’s an internal process.
No regrets on what he has achieved so far. There isn’t anything he’d like to change about the journey.
