Principles of Management

Management Learnings from "Principles of Management" subject

2012-09-03T01:59:00.000-07:00

The Three Monks!!

2012-08-19T07:40:00.002-07:00

This blog is about the learning from a great Chinese animation movie - “The Three Monks”. I don't know about everyone, but I found it interesting. It was a nice departure from the normal text-book study method, and that's true about the whole POM course here in NITIE. In fact, that's what an MBA education should be because a picture is worth a thousand words. Coming back to the movie - It is about three Chinese monks who live in a monastery on the top of the mountain. It's really fun to watch.

Background:
After the Cultural Revolution and the fall of the political Gang of Four in 1976, the film was one of the first animations created as part of the rebirth period. It is also referred to as The Three Buddhist Priests. The film is based on the ancient Chinese proverb "One monk will shoulder two buckets of water; two monks will share the load, but add a third and no one will want to fetch water." If you watch the film, you'll notice that the film does not contain any dialogues, allowing it to be watched by any culture, and a different music instrument signifies each monk. It was released in 1980.

Interpretation:
The movie can be interpreted to understand certain management principles too.

When the 1st monk was alone, he was solely responsible for whatever happens at the temple, and hence did his work diligently. Here the productivity was maximum as there were no distractions and no opportunities to shun responsibility.

Then a 2nd monk enters the picture. This leads to the 1st monk trying to kart off the work to the 2nd monk, who soon realizes what's going on. So they come up with a solution where both of them carry a single bucket. Here it can be observed that the productivity has reduced as they can carry only a single bucket in one pass. This could have been avoided if they both had assumed responsibility and had come up with a solution like each bringing 2 buckets of water on alternate days.
In any case, this is an example of continuous innovation. When the circumstances changed, the process was changed too so that the result could be optimised.

During the course of my employment I have worked with people from at least 5 different nationalities, and I have learned that it is not often that two people have similar opinions about people and situations. Everyone on my ship was almost equally competent and experienced and being more qualified was certainly not enough to persuade them to go about working in a certain way.

When asked in class about the solution to the problem of sharing load, a lot of them came up with different solutions. But the best solutions are always the simplest ones. here too the solution was quite simple - measure the centre using a scale.

Towards the end we see that the monastery catches fire. When this happens, all the monks forget their hostility and try to put out the fire. The dilemma of who will carry the water was quickly forgotten and a system arose out of the initial chaos. They all put out the fire quickly. Drastic innovation adds an altogether new dimension to the process and fundamentally changes it. That's what the monks did when faced with the fire at their temple.

Many a times crisis situations are encountered where any kind of system is in place. I myself faced several of those when I was working on ships. However, every time the crisis hit, the entire team came together to solve the issue and take the ship back to the normal state. Forgotten were the hierarchies; gone were the differences. In one instance, the ship's crew fought fire for 52 hours non-stop. Not only the ship's entire crew came together, but a ship passing nearby also lent it's help in the form of human resources.

In the end we see that the monks resolve the situation by fixing a pulley and dividing their roles - hooking the bucket, roping it in and transporting to the monastery. A fairly simple solution!!

Humans have a propensity to stay the same. However, that's not how nature works. As they say - Change is the only unchanging phenomena in this world. In keeping with this, it is important that new ways of improvement are continuously implemented. Change should not be the last resort.

And before you leave, I must tell you that this film won a few awards too:

Won the outstanding film award at China's Ministry of Culture.
Won the Best animated film prize at the first Golden Rooster Awards in 1981.
Won four international awards including a Silver Bear for Short Film at the 32nd Berlin Film Festival in 1982.

Company Analysis: Cognizant Technology Solutions

2012-07-28T13:40:00.003-07:00

"COGNIZANT" - PASSION FOR MAKING A DIFFERENCE

Francisco D'Souza - CEO of Cognizant Technology Solutions

Cognizant Technology Solutions Corp. is an American multinational provider of information technology, consulting and business process outsourcing (BPO) services. It is headquartered in Teaneck, New Jersey, with significant presence in other countries, especially India.

Cognizant is included in the NASDAQ-100 and the S&P 500 indices.

KEY POSITIONS

CEO - Francisco D‘Souza
CFO - Karen McLoughlin
CHAIRMAN - John E. Klein
VICE-CHAIRMAN - Lakshmi Narayanan

HISTORY

Cognizant has its roots in Dun & Bradstreet Satyam Systems (DBSS), an India-based joint venture between D&B (76%) and Satyam Computers (24%).
DBSS focused on implementing large-scale IT projects for the D&B businesses
1996 - DBSS spun off several of its subsidiaries(IMS International, Erisco, Nielsen Media research, etc.) to form Cognizant Corporation.
Jan ‘97 – DBSS was renamed to Cognizant Technology Solutions (CTS).
July ’97 – D&B bought Satyam's 24% stake in DBSS for $3.4 million
Mar ‘98 – Kumar Mahadeva was named the CEO.
CTS operated as a division of Cognizant Corporation and focused mainly on Y2K-related projects.
1998 – Parent company Cognizant Corporation splits into two companies: IMS Health and Nielsen Media Research. CTS became a public subsidiary of IMS Health.
June ‘98 – IPO raised by IMS Health, company raised $34 million. Money was earmarked for debt payments and upgradation of the company’s Indian offices.
2003 – IMS Health sold its entire 56% stake in CTS

KEY MILESTONES

1994: Started as the technology arm of The Dun & Bradstreet Corporation
1996: Began adding third-party clients (usually pursued the Y2K related projects) and servicing the best across industry segments. Won two large accounts outside of D&B: Northwest Airlines and Aetna
2002: Became the first company to be assessed enterprise-wide against mature industry-process certifications, such as P-CMM level 5, BS 7799, SEI-CMMi Level 5
2004: Acknowledged as a leading provider of IT services by industry analysts such as Gartner, Forrester, AMR and IDC; added to the prestigious NASDAQ 100 Index
2006: Became the fastest global IT services company to reach a $1 billion run-rate (under 12 years)2007: Acquired MarketRx, Inc., a leading provider of analytics and related software services to global life sciences companies; crossed $2 billion revenue threshold
2008: Entered Fortune 1000; exceeded $2.8 billion revenue mark
2009: Joined Fortune's "Most Admired Companies" list; named to BusinessWeek 50 list of the top-performing U.S. companies for third consecutive year; named to Forbes "25 Fastest Growing Technology Companies In America" list for sixth straight year
2010: Selected for Fortune’s “Most Admired Companies” list for the second year in a row; placed in Top 5 for IT services
2011: Cognizant joins Fortune 500, ranking #484

VISION & MISSION STATEMENT

VISION:

To lead sustainable growth with environment friendly practices and responsible use of natural resources

MISSION:

Cognizant's single-minded mission is to dedicate our business process and technology innovation know-how, our deep industry expertise and worldwide resources to working together with clients to make their businesses stronger.

BUSINESS SEGMENTS

SERVICES

Cognizant provides a broad and expanding range of information technology consulting and business processing outsourcing services, including:
Project-based application services
Business process services
Business and technology consulting
Complex systems integration
Application outsourcing
IT infrastructure and cloud services
Analytics, Business Intelligence, CRM, Data
Data Warehousing, Supply Chain Management
Engineering Management Solutions, ERP
Testing Solutions

GLOBAL FOOTPRINTS

Cognizant has offices all over the world, located strategically to help them serve their clients and deliver the best expertise effectively and efficiently.
In addition to its headquarters and delivery center in Teaneck, New Jersey, Cognizant has five additional delivery centers in the United States of America: Bentonville, Arkansas; Bridgewater, New Jersey; Chicago, Illinois; Holliston, Massachusetts; and Phoenix, Arizona. The company has more than 140,000 employees globally, of which over 100,000 are in India across 10 locations with a major chunk in Chennai. The other centres of the company are in Bangalore, Coimbatore, Gurgaon, Hyderabad, Kochi, Kolkata, Mangalore (CoreLogic), Mumbai and Pune. The company also has local, regional and global delivery centers in the UK, Europe, China, Middle East, Philippines, Canada, Argentina, and Mexico. The leadership is mainly based in the United States.

COGNIZANT's UNIQUE OPERATING MODEL

Independent Cognizant customer satisfaction surveys consistently reveal that our clients receive superior quality IT services at significantly lower cost, which enables them to maintain operational agility and focus on core competencies that drive bottom-line and top-line growth.

SWOT ANALYSIS

EMPLOYEE STRENGTH

Cognizant has approximately 140,500 employees as of March 31, 2012.

Here is a graph showing the total employee base of Cognizant over the past 5 years:

Cognizant Technology – Financial Performance – 2006-2011

Except in 2009 (16% YoY) due to recession caused by Global Financial Crisis Cognizant had seen significant YoY revenue growth 2010 (40%) and 2011 (33%). But compared to other Indian Top players Cognizant has done really well during and after the recession and crisis.
Significantly reduced the operating expenses during FY 2009 and later increased operating expenses in line with the revenue growth.
Cognizant has overtaken Wipro and became the Number 3 player and is closely following on the heels of number 2 player Infosys. Cognizant had seen tremendous growth in the past few years.

Cognizant Technology – Geography Mix – 2006-2011

Dependency on the North America is very high compared to other Indian players and it gets almost 80% of revenues from the region.
Europe has been constant at 18-19%.
Rest of the World ( APAC, Latin America, MEA) revenues are small but growing slowly.

Cognizant Technology – Vertical Revenue Mix – 2006-2011

Cognizant is the dominant player in the BFSI segment and it gets significant amount of revenues from Insurance segment along with financial services segment.
Healthcare is the second largest revenue contributor and has significant dominance in this vertical and Healthcare spending in US is on the rise.
Manufacturing/Retail/logistics is growing over past three years.
Cognizant focuses on these few verticals for growth.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Philanthropic efforts are conducted through the voluntary efforts of Cognizant employees and support from “Cognizant Foundation”, which is its CSR arm.

The Cognizant Foundation aims to helps "unprivileged members of society gain access to quality education and healthcare by providing financial and technical support; designing and implementing educational and healthcare improvement programs; and partnering with Non-Government Organizations (NGOs), educational institutions, healthcare institutions, government agencies and corporations".

Some of the projects carried out by Cognizant Foundation are as follows:

Education

IT Training for the differently abled persons
Computer education for underprivileged boys
Empowering women with job skills
Education and rehabilitation of differently abled children
Literacy through primary education for rural girls

HealthCare

Sophisticated Cardiac care to the needy
Artificial Limbs for the differently abled
Mobile Eye care unit to treat low vision problems
Subsidized dialysis treatment for the poor

GRASSDOOR REVIEW

OBSERVATIONS

Cognizant is a growing IT consulting company which is making its presence felt across the world and especially in India, where it is closing its gap with its competitors.
Is dependent a lot on US economy since it generates a major chunk of its revenue from there.
Is dependent a lot on “BFSI” business segment and earns around 40% of its revenue from it.
Cognizant’s entire revenue is generated from only 400 or so clients. Of their 400 clients, 87 are 'strategic' (i.e., they generate $5-40 million/year in fees).

Valley Crossing Exercise

2012-07-28T11:37:00.000-07:00

Valley Crossing Exercise – Yet another exercise to understand management concepts!

Famous Quotes:

Talent win games, but teamwork and intelligence win championships – Michael Jordan

If everyone is moving forward together, then success takes care of itself - Henry Ford

“Valley Crossing Exercise” is a very useful management exercise to understand the importance of teamwork. Teamwork is a mixture of action process, interpersonal process and transition period in between. Teamwork consists of leadership, team formation, team norms, outcome interdependence, competition and cooperation. Teamwork can lead to better decisions, products or services.

The following image clearly depicts why teamwork is so much useful and what it can lead to:

“Together Everyone Achieves More”

As can be seen in the above image, when multiple people work as part of a team, the overall output obtained is much higher than the one obtained by working individually.

Explanation of valley crossing exercise through a picture is as below:

Understanding of the exercise:

Three people who are one side of a valley have to cross the valley using a rod. The gap between the valleys is more than one step long but less than two steps. At any time, all the three people have to hold the rod and using synchronous movements, cross the valley.
Any person, while on top of the valley (the “risky” position to be in) will be supported by other two people. All the three members here have interchanging roles in the completion of task. As can be noticed in the above image, all the three members have equal distribution of risky, half-risky and safe situations.
The success of this exercise will depend upon how closely the three people work as part of a team, coordinate and communicate with each other through sound/signals and follow a synchronous movement.

Here are the steps required to complete this exercise:

Below are the management lessons learnt from this exercise:

1. Responsibility:

Everyone in an organization should feel equally responsible to achieve the objectives of the organization. Task can only be completed successfully if everyone in the team works collectively and in a responsible way.

2. Planning:

Proper planning is required to be done for initiating any task so that the task is completed on time. In the valley crossing exercise, the plan was already formulated by the team members in the way they would cross the valley (take 9 steps with alternate and synchronous movement of left and right leg). The plan should be focused on how we can leverage our strength as a team.

3. Communication:

Effective communication is very much essential for the success of the team and the organization and as it has been proven in this exercise. Synchronous movements by communicating with each other through sounds/skills were very much essential for the success of this exercise.

4. Shared vision:

It is important to have a shared vision, which is clear and informs about where the organization wants to head in the future. Vision needs to be shared with all the members of the organization so as to enable the members to work collectively in achieving the organization’s defined goal.

5. Trust:

Organizations cannot be successful if there is no element of trust in it. As in the case of valley exercise, a person was ready to cross the valley while being in a “risky” and “half-risky” state only because he/she trusted the other members in the team. Similarly, in an organization, managers and employees need to trust each other.

6. Defined roles and responsibilities:

Roles and responsibilities need to be clearly defined for each and every individual in an organization since then, they will be aware of the kind of work that is expected from them. Valley crossing exercise was successful since each member knew when to move their leg (either left or right) and that it should be in sync with the other members of the team.

7. Coordinative relationship:

Signifies the bond between the team members to allow them to seamlessly coordinate their work to achieve both efficiency and effectiveness.

8. Interdependent Task:

It is the extent to which a member of the team needs to interact with the other team members to complete the work. As in the valley crossing exercise, it was of utmost importance for a member to be interdependent on other members so as to mitigate the risk and complete the task in hand.

Interdependent task becomes more crucial once we go higher up the corporate ladder. It becomes more important to work with the team, take their inputs and consider their expertise/skills/opinions.

9. No scope for “social loafing”:

There is no scope for social loafing while working in a team. Everyone is expected to work to achieve the defined objectives.

LE02 - Theory X and Theory Y

2012-07-28T06:54:00.000-07:00

Managers and Employees are two important entities in any organization. It is very important for these entities to be in sync with each other for the productivity of the organization. Theory X and Theory Y is all about the attitude and the behaviour of the manager towards the employees.

Theory X managers are of “Authoritarian Management” style who thinks that an employee is not interested in doing work and hence they need to be pampered every now and then to meet the business objectives. They believe that most of these employees are self-centered and lack ambition. Such managers usually try to force the employees to work.

Theory Y managers are of “Participative Management” style who works alongside the employees and provides his/her full support to meet organizational objectives. Such managers have full trust in their employees and provide as much support as they can.

Based upon the attitude and the behaviour of the managers, we can broadly categorize them into 4 different categories:

Lazy Employee and Theory X Manager: The employee is lazy and the Theory X manager too thinks that the employee is lazy. Theory X Manager does not try to motivate his/her employees and hence the productivity of the organization is hampered. Please note here that the employee might be lazy/behaved as lazy for multiple reasons: he may not be interested in the work assigned to him or else, the work provided to him might not be good and hence he is disinterested. The growth of the organization is very limited in this case.
Not Lazy Employee and Theory X Manager: The employee is not lazy and Theory X manager assumes that the employee is lazy. This is one of the most dangerous situation for an employee to be in since he/she is totally demotivated because the efforts stands unrewarded. Such employees, dissatisfied with the behavior of the manager, will ultimately think of leaving the project/organization.
Lazy Employee and Theory Y Manager: In this scenario, the employee is lazy but the manager thinks that he is not lazy and motivates him to perform better in all circumstances. The management is too optimistic here and constantly supports the employees to work effectively. The employee can be motivated through multiple methods like employee engagement programs (carried out in my previous organization), discussing the objectives of the organization with the employee and bringing him/her on the same line, etc.
Not Lazy Employee and Theory Y Manager: In this scenario, the employee is not lazy and performs to the best of his abilities and the manager too thinks that the employee is not lazy and is performing efficiently. An ideal situation for any employee to be in since his efforts are highly appreciated and the motivation is present to achieve organizational objectives. Such organizations will always witness a continuous growth and the employees too will be satisfied while working in the organization, resulting in low attrition rate for the organization.

Please note here that the Theory X and Theory Y is not about the employees but it is about the managers.

Some examples from my 4 years stint at TCS, depicting few of the above situations:

Situation 1: I know a great friend of mine with 5-6 years of work-experience, who was into a support/maintenance project and the project had technologies he had never worked in. He wanted to change the project as soon as possible but it was not possible since the manager did not agree and hence he was totally dissatisfied with the kind of work he was assigned. Hence he could not perform the task assigned to him in an efficient way and his manager always use to complain about his lazy attitude.

Situation 2: I had been in this category for a very long time when I was working with a manager who always wanted us to work for long hours, even when the work gets completed on time. And it resulted in me outpouring of dissatisfaction in front of him.

Being a future manager, I learnt how important it is to be fair to your team members to improve the productivity of the organization. Each and every manager need to learn the art of motivation and should constantly strive to motivate his/her employees.

LE01 - Tower Building Exercise

2012-07-28T06:45:00.000-07:00

In any organization, effective goal setting is an essential ingredient for the professional well-being of the employees. It is rightly said that “Most of the employees don’t leave a company but they leave their managers”. An organization consists of two different entities: Employees and Managers. Effective goal setting done by the managers, taking into consideration the needs of the employees, will go a long way in maintaining a good bonding of the employees with their company.

A tower building exercise was held in our class to demonstrate and learn the Goal Setting process in a realistic way:

The tower building game involved putting square cubes one over the other in any fashion. The student building the tower will be allowed to use only one hand. Aim was to achieve the maximum height possible. Each and every student was asked to predict the height of the tower in terms of the number of square blocks. A random student (who estimated 10 blocks) was called to build the tower. The student started to build the tower and faltered after 17 blocks.

Following conclusions were drawn from the exercise:

Students who had set the goal as more than 17 blocks had “Ambitious Goal” where Goal Set>Attainable Goal.
Students who had set the goal as less than 17 blocks will now increase their goals since the potential will increase after having performed the exercise. Here we can say that Goal Set>Achievable Performance>Historical Performance.

We were now again asked to try the same exercise but with a change in the criteria that the person building the tower will be blind folded. Students were asked to revise their estimates based upon the new criteria and their individual perception. Conclusions were noted as follows:

More than 90% of the students lowered their targets since they thought that the blind folded person will not be able to build a tower higher than the one initially built. In an organization, such employees are considered as “Back Folders” since usually, targets should never be revised after having realized your potential and working effectively towards it. The more we gain knowledge and skills working in the organization, goals should be revised in an upward direction.
Some students increased their target this time since they realized their true potential after having performed the exercise atleast once. Such minds are called the “Progressive Minds”. Speaking from a organization perspective, it is important for it to have as many "Progressive Minds" as possible. Having worked in TCS, I am aware about how the organization flourished during tough times, having left all its Indian competitors way behind. It was only possible because of the progressive mind of our CEO and who made his employees follow the same path.

This goal setting exercise helped me learn the actual value of Goal Setting. It is important for Goals to be set using the fundamental principles of SMART (Specific, Measurable, Attainable, Realistic, Timely). It’s also important for a manager to evaluate the goals in an unbiased way and provide proper feedback to the employees. Employees should be evaluated on the basis of their skills and their participation in helping the organization achieve it's objectives.

Being a future manager, I learnt how important it is to set the goals properly for the well-being of the employees and the organization and help the company achieve outstanding performance.

Khan Academy

2012-07-04T14:57:00.002-07:00

Salman Khan - The Teacher

Khan Academy is a non-profit organization which delivers online tutorials to students through videos uploaded on YouTube. The Academy is created by a Bangladeshi American educator Salman Khan. The tutorials teaches almost all education disciplines like Mathematics, History, Finance, Medical, Science, Physics, Chemistry, Economics, etc. Funds for this non-profit organization come from Bill & Melinda Gates Foundation & Google.

Khan Academy has revolutionized the way students can learn in this age. With the stated mission of “providing a high quality education to anyone, anywhere, anytime”, it's digital archive on YouTube contains more than 3,200 micro lectures. Number of unique visitors watching these videos have already surpassed 5 million.

The students can learn at their very own pace and convenience by watching these videos. There is no interference from any of the teachers and there is no one to ask, “Did you understand this?”. In case of any doubt, the student can playback the session as many times as needed.

What things can we learn from Khan Academy? Can we relate it to the concepts studied in Principles of Management subject? We certainly can.

1. Theory X and Theory Y Manager (more here):

Here the student learning through the online videos can be considered as a good employee who works effortlessly to achieve his/her goal (to learn as much as possible). He/she is not distracted by outside interference and can learn at one's own pace and in a flexible way.

The teacher too can analyze the progress of the student through the online analytical tool and can help the student if required. Here the student behaves analogous to a “good employee” and the teacher behaves analogous to a “good manager”. Both of them can work in a symbiotic way to do good for one another.

2. Globalization:

In this era of flat world, it’s important to go global. Khan Academy did the same thing by posting the videos over internet, thus enabling people across the world to watch them and learn at their convenience. Any organization today needs to go global if they think of promoting their organization to a world-class level.

3. Social Responsibility:

Organizations today need to be much more socially responsible than ever. Khan Academy works towards the betterment of the society by providing them free and world-class education. Its organizational plan revolves around social cause. Not all organization’s plan can revolve around social cause; however they do need to ensure that it’s their responsibility to give it back to the society in which they are flourishing.

4. Entrepreneurship:

A single idea, just one single idea can change the way things are perceived around the world. Though initially Salman Khan created these videos for his cousins, however seeing the response received from many students across the globe, he left his job and took up this noble cause of promoting free education. And this was when he did not have much money at his disposal.

We need “Entrepreneurs” in this age. Unique ideas from a lot of different entrepreneurs can change the way things happen in the world. As our professor Dr. Mandi rightly says, “Aaj ki roti aaj hi kamana”, we need to be entrepreneurs and earn for ourself rather than working for others.

Innovation:

Innovation was one of the first things that would catch someone's eye and it was promoted well by Salman Khan. He did a wonderful job of starting with web tools which gives useful information to anyone viewing the video. There is this wonderful knowledge true that takes you through all the concepts of a subject in a gradual progressive way so that we don't miss any concepts and jump topics.

And still, this guy is such a down-to-earth person. His work has already touched millions of people around the world. Donations keep on pouring from all corners of the world.

Truly amazing guy, isn't it?