Organizational Culture

Today, we began our discussion not with any extraordinary tools or toys but on the basis of an extraordinary story of the Alibaba Group.

AliBaba Group is a privately owned China-based family of Internet-based eCommerce businesses that cover business-to-business online marketplaces, retail and payment platforms, shopping search engine and data-centric cloud computing services.

It started with the vision of its founder, Jack Ma, that :

(a) Empower SMEs through the power of the internet.

(b) At least 80% of these SMEs who are working with AliBaba MUST grow unimaginably.

(c) 0.0001% of the shares of AliBaba must be enough to support generations together.

Today AliBaba's consumer-to-consumer portal Taobao (similar to eBay) features nearly a billion products and is one of the 20 most-visited websites globally. Alibaba Group's sites account for over 60% of the parcels delivered in China.

And why was this so?

It was made possible due to the exceptional culture embedded in the fibre of the organization.

So, one asks, what is organizational culture?

Organizations, just like individuals, have their own personalities—more typically known as organizational cultures. Understanding how culture is created, communicated, and changed will help you to be a more effective manager. But first, let’s define organizational culture.   

Organizational Culture encompass the values and behaviours that contribute to the unique social and psychological environment of an organization.

Organizational culture includes an organization's expectations, experiences, philosophy, and values that hold it together. It is expressed in its self-image, inner workings, interactions with the outside world, and future expectations. It is based on shared attitudes, beliefs, customs, and written (sometimes) and unwritten rules that have been developed over time and are considered valid.   

There are various types of organizational cultures. We discussed a few of them in class. I am listing them below:

1. Open Culture - One where employees are motivated to voice their values-driven concerns regarding problematic business practices. An open culture helps to counteract any occasional lapse into passivity at the board level or on the part of institutional investors.

2. Safety Culture - One where safety is  ALWAYS first no matter what the cost. A safety culture is one were all employees are proactive in ensuring safety at work place. People immediately report any perceived short comings in the work place safety and in the safety of products given to customers or clients.

3. Quality Culture - A culture where utmost importance is given to the quality of the product or service being rendered. Volume takes a back seat. So does cost. Batch recalling of cars/computers when defects are found is a good example of the quality culture. Toyota is a notable example.

4. Performance Culture - We could also call this OUTCOME ORIENTED CULTURE.  This is one that emphasize achievement, results, and action as important values. A good example of an outcome-oriented culture may be the electronics retailer Best Buy. Having a culture emphasizing sales performance, Best Buy tallies revenues and other relevant figures daily by department. Employees are trained and mentored to sell company products effectively, and they learn how much money their department made every day.

5. Ethical Culture - A culture where great importance is given to ethical business practices and this importance is seen at all levels in the organization. We see that in such organizations, ethics are given precedence even if being so may lead to a loss of business and profit. The TATA Group is a good example to note.

The culture of organizations is usually inferred and remains invisible, much different from rules, which are explicit. It is not enforced as a rule but is much more powerful than rules in many cases.     

    

In creating organizations, you must have an understanding of both the rules and the culture. Being appreciative of both these parameters would help you guide yourselves and others through the organizations channels, which is what makes you a good manager. 

This was the most important takeaway from today’s lecture.

Grameen Bank

Today, before coming to class, prof. Mandi had asked us to view videos posted on certain links. Unpretentiously, after dinner, I and my friends started watching the video. And what we saw in the videos amazed us to a great extent. Although I knew about Mohd. Yunus, the exact extent of the work done by him was unknown to me. Before delving into what I learnt in class, I believe a small introduction is required.

The Grameen Bank is a community development bank started in Bangladesh. They give small loans (known as micro credit or "grameencredit”) to poor people without asking for collateral. The system of this bank is based on the idea that the poor have skills but have no chance to use their skills without some money that is their skills are under-utilised. Most of the banks loans go to women.

Muhammad Yusuf with his money lenders

The Grameen Bank was started 1976 when Professor Muhammad Yunus, a Fulbright scholar and Professor at University of Chittagong, researched how to provide banking for the rural poor. In October 1983, the Grameen Bank Project was made into an independent bank by the government. The group and its first member, Muhammad Yunus, were awarded the Nobel Peace Prize in 2006. Grameen Bank is owned by the people who borrow the money, mostly women. The borrowers own 94% of the bank, and the other 6% is owned by the Government of Bangladesh.

   Below is the video we were asked see. Watch it, it's worth your time. It will also give some context to what happened in class and the key learnings we had.

Our class did not focus solely on aspects of social business. Instead – being a Principles of Management class – we focused on the difference in style of management and in delivery of product. We started out by discussing the difference between a traditional banking system and the Grameen micro-credit system. For the sake of simplicity, I am tabulating the differences below:

		TRADITIONAL BANKING	GRAMEEN BANK
1.	Purpose	Maximizing Profit (Profit Motive)	Reducing Poverty
2.	Collateral	Needed. Without which no loans will be given.	No collateral needed
3.	Ownership	Businessmen – Rich People	By the Poor
4.	Loan Amount	Large Amounts	Very Small Amounts
5.	Type of Lending	To individuals	To small groups of people –Solidarity lending
6.	Type of Interest	Usually Interest is compounded	Simple Interest
7.	People Money given to	In most developing countries there seem to be a bias towards men.	Women are the primary focus. In fact women make up 97% of Grameen Bank Customers
8.	Location	Primarily located in urban areas	Primarily located in rural areas

We had earlier discussed about Management by Objective and Organisational Structure. Both these contribute to another phenomenon – Organisational Culture. Basically, it is the behaviour of humans who are part of an organisation and the meanings that the people attach to their actions. Culture includes the organisation values, visions, norms, working language, systems, symbols, beliefs and habits.

Management is like a rainbow/kaleidoscope, which can take different shapes as per the requirements of the organizational culture. Culture, structure values, etc. of different organizations would be different depending upon the purpose and management students should understand this.

The culture at Grameen Bank is to find ways to eradicate poverty. The Managing Director of the bank does not ask, “Why are Profits down?”

Instead he asks, “How many people have you taken out of poverty today?” It is precisely this culture that has allowed the Grameen Bank to achieve so much.

This is the most important take away from this class. It is the Organisational Culture that motivates employees to perform well. It is the Organisation Culture that affects the way people and groups interact with each other, with clients, and with stakeholders.

Leadership and management need to drive the culture and structure of any organization. Just having a roadmap is not enough; you need to drive it.

Navrang Puzzle

The day began with Prof. Mandi bringing in a colourful cube, breaking it into 27 cubes and asking us to assemble the individual blocks back into the cube such that each face contained only one colour. Unlike a standard Rubik's Cube, the Navrang Puzzle can be dismantled and reassembled. We were challenged to find an algorithm or method to reassemble the Puzzle in order to reach the intended objective. After a few desperately minutes of thinking, a few students devised a plan which didn't work too well.

And then Prof. Mandi took over.

Prof.Mandi solved the Puzzle in about 2 minutes using a well-defined method. Sir had used a 3-step algorithm.

He explained to us how a lot of problems, both in life, and in organizations, are similar in nature, multi-faceted, unexpected, and with time constraints. How they all have smaller, individual elements to them that have to be solved for us to solve the complete puzzle. And how, with the application of the right principles of management, we can actually, pretty easily, solve them.

It is here we were introduced to two important concepts: (a) Organizational Structure and (b) Unity of Objective.

An Organizational Structure consists of activities such as task allocation, coordination and supervision, which are directed towards the achievement of organizational aims. An organization can be structured in many different ways, depending on their objectives. The structure of an organization will determine the modes in which it operates and performs. This of course leads us to the next idea. Unity of Objectives stands for the philosophy according to which every individual and every process in an organization should aim to fulfil the organization's Objectives and Mission Statement.

The key to solving any problem, is organization. You organize your problems, and their sub-problems in order, and that is half the job taken care of. The first step is to segregate the similar elements of the problem - the like-colored cubes - together. Once you have done that, everything else falls into place, and your coming out successful is simply a matter of applying simple logic and common sense in each level, and avoiding any mistakes while you do so.

Another key concept in all of this is the importance of effective communication.

 The better you are at communication (either way), the better you learn how to do things, and how not to do things. You can watch and learn from the experiences of your seniors, or the mistakes of your peers, and nothing can teach you better.

The most important step was to understand is that without an objective, this puzzle would never have been solved. It is the objective that determines the method in which we have to solve the problem. Any method we device, it must be capable of being easily replicated. Only then can we achieve economies of scale and get effective outputs.

Alignment

Continuing his trait of bringing in seemingly unrelated artefacts into class,  Prof.Mandi walked into class with a chunk of magnet and asked us, “Why does a magnet attract?”. After many unsuccessful attempts by us at giving a good answer, the answer finally came up as the magic word – Alignment.

What is alignment? 

Alignment is done by regular ordering of repeated a number of times in a set process. it is in this ordering that the source of the power of any aligned entity lies. A Magnet has its power because it can align innate magnetic forces in metallic atoms. So, magnets align natural forces. 

Managers align people and power. They align tasks and objective. They synchronize both time and space. Management is Music, not noise. It is like the conductor of grand orchestra, where each instrument contributes to harmonious music. Only proper alignment would lead to music, else it would result in noise.
A Manager aligns human forces to get work done. In effect an organization is a force that is aligned. The bigger or better an organization, the more perfectly it is aligned.

Here we come to a very important management lesson – Management by Objective.



 Management by objectives (MBO) is a process of defining objectives within an organization so that management and employees agree to the objectives and understand what they need to do in the organization in order to achieve them. The term "management by objectives" was popularized by Peter Drucker in his 1954 book The Practice of Management.





The essence of MBO is participative goal setting, choosing course of actions and decision making. An important part of the MBO is the measurement and the comparison of the employee’s actual performance with the standards set.

In most organizations, there occurs alignment during appraisal/goal setting cycles, where the goals of the employees are aligned with the vision/mission statements of the company.


For greater clarity on the topic we compared two different styles of management we had previously studied in class – the blindfolded tower building and the three monk collaborative water collection. The major lessons we drew could be summarised as shown below:

	Blind Tower Building	Three Monk Collaboration
1	Management Present	Management absent and replaced by autonomous management/ maintenance
2	Loading is High and Low	Loading is more or less equal
3	Hierarchical set-up	No Hierarchy
4	Control Mechanism	Consensus Mechanism
5	Control with Top Management	Consensus among all

We ended our discussion by comparing two Indian Tennis stars - Leander Paes and Mahesh Bhupati and understanding why they were unable to cooperate and work. 

We concluded that the main reason was a skill set mismatch. Multiple skills could come as a disadvantage as the ability to exercise choice comes into the picture. Management should figure out which all skills to hone & nurture and which all to get rid of or discourage.

          Thus, the most important take away in today's class was the concept of MANAGEMENT BY ALIGNMENT.

Twisting the Concepts of Management

Today, we were given an assignment to be prepared before coming to the class. We were supposed to watch the below video and read the related blogs describing the learnings of the video. I had gone through the video earlier when I was skimming through content of various blogs as instructed by the professor earlier.

'The 3 Monks' - An award-winning short film

The discussion in the class began informally about the content in the ‘3 Monks’ video. We were asked to list down the learnings from the video as per our perception.

The usual verbiage of terms cropped up among many in the class, with myself also contributing in the fray.

Some of these were:

·         Co-operation

·         Process Improvement

·         Positive & negative traits in people

·         Synergy and team-work

·         Disaster bringing management skills to the fore

The professor also encouraged us in our answers to elaborate and for quite some time, I was sure that we were going along the right track.

Then one amongst us (Pratik Kadam) gave an answer that the video also showed the importance of using tools like scale and pulley. Initially, I thought his answer was irrelevant in the scope of the current discussion but Dr. Mandi immediately asked for applause for Pratik. That’s when I realized the actual intention of the professor and his way of thinking different from the conventional outlook of management.

Dr. Mandi explained to us that the actual secrets of management did not lay in the conservative ideologies of management but lay in the technical implementations that one could bring about in any application of management.

For e.g. To improve the management in an organization, it is important to implement technical ideologies like improving the process/method, measurement of effort & productivity etc. rather than improving factors like working conditions, feedback mechanisms, etc.

“Don’t focus too much on the human part before you can sort out the technical part.”, is what Dr. Mandi said.

At the start of any management initiative, one should not attempt to modify the human relations aspect; rather one should focus upon the technical aspects first and get in to the HR aspects after having gained experience.

Thus, the film though depicting co-operation, team work, positive & negative aspects of human management, is rather focused upon different aspects like applications of various methods of work, measurement and importance of efficiency and effort, etc.

This was a drastic turnaround in the discussion and we began considering the video in ways not imagined earlier. And now the answers came out in concurrence with Dr. Mandi’s take on the video.

·         The use of technical instruments like scale, pulley, etc. during any process

·         Need to set a process before starting a job

·         Minimizing the effort for a job by using various methods of work

·         Productivity improvement

Discussing further about the various methods of work, the film shows different approaches to carry out the task of bringing water from the lake.

These involved

1.)  a single man carrying one bucket on his head

2.) single man carrying 2 buckets using a rod across shoulder

3.) two men carrying 1 bucket on centre of the rod

4.) use of pulley

Now, he asked as to which method would carry the least effort.

Option 1 can be said to have the most effort (say 20 J)as it involved just one person without the use of tools.

Option 2 involves significantly less effort (around 10 J)than opt.1 but there was confusion when it came up against option 3. The argument was that as option 2 involved more amount of work being done by just one person it was the better methods of working.

However, most people failed to consider the fact that option 2 would take much more effort than option 3. The effort taken in option 3 would be much lesser (maybe 2 J)than that in option 2 and would be almost negligible.

Option 4 would take still lesser effort, but it is kept aside due to its exceptional nature.

The way of carrying the water and effort taken had affected the functioning of the monks (i.e. their management, on a broader level) and we can see that selecting the proper methods at the start would have improved their self-management in a considerable manner.

Thus, this just goes on to show the importance of the use of technology in today’s management which is rather drifting towards non-physical processes and soft skills. New age managers should go back to the old-school way of management by focusing on hard-core measurable like productivity, efficiency, effort, etc.

Dr. Mandi once again showed us an unconventional manner of thinking, putting a twist in our perception of management.

This trend would surely continue in the next class…

Goal Setting...

After learning about the different styles of management through an innovatively styled game in the last class, this time around, the class began in a conventional manner, with people sitting firmly in their chairs. Today, we were given a clear cut agenda of what we were going to discuss:

Goal Setting

One of the basic fundamentals of setting goals was to follow the popularly known SMART principle.

Of course we all know what the acronym stands for, but Dr, Mandi encouraged us to interpret it in our different styles. To interpret an idea or a principle, apart from the conventional manner, is one of the most important characteristic a manager needs to have to be successful.

With this in mind, we began to define SMART in different manners as below:

S – Simple, Superb, Synchronized, Stunning

M – Marvelous, Mind Boggling, Mature, Macho, Magical

A – Abounding, Absolute, Accelerated, Accurate, Adventurous, Admirable

R – Real, Radical, Rational, Resourced, Resonant, Realistic

T – Tactical, Tangible, Tenacious, Thrilling

With so many varied ideas coming forth, discussions went on regarding how a particular point from above may lead to a better set goal.

Formally, the SMART way of goal setting may be expressed as follows:

S – Specific:

The first term stresses the need for a specific goal over and against a more general one. This means the goal is clear and unambiguous; without vagaries and platitudes. To make goals specific, they must tell a team exactly what is expected, why is it important, who’s involved, where is it going to happen and which attributes are important.

M – Measurable:

The second term stresses the need for concrete criteria for measuring progress toward the attainment of the goal. The thought behind this is that if a goal is not measurable, it is not possible to know whether a team is making progress toward successful completion. Measuring progress is supposed to help a team stay on track, reach its target dates, and experience the exhilaration of achievement that spurs it on to continued effort required to reach the ultimate goal.

A – Achievable:

The third term stresses the importance of goals that are realistic and attainable. While an attainable goal may stretch a team in order to achieve it, the goal is not extreme. That is, the goals are neither out of reach nor below standard performance, as these may be considered meaningless. When you identify goals that are most important to you, you begin to figure out ways you can make them come true. You develop the attitudes, abilities, skills, and financial capacity to reach them. The theory states that an attainable goal may cause goal-setters to identify previously overlooked opportunities to bring themselves closer to the achievement of their goals.

R – Relevant:

The fourth term stresses the importance of choosing goals that matter. Only goals that are relevant to you would receive the necessary motivation to achieve them. Relevant goals (when met) drive a team, department, and organization forward. A goal that supports or is in alignment with other goals would be considered a relevant goal.

T – Time-bound:

The fifth term stresses the importance of grounding goals within a time frame, giving them a target date. A commitment to a deadline helps a team focus their efforts on completion of the goal on or before the due date. This part of the SMART goal criteria is intended to prevent goals from being overtaken by the day-to-day crises that invariably arise in an organization. A time-bound goal is intended to establish a sense of urgency.

Thereafter, we went on to apply this newly learned and discussed principle to our previous problem from the last class of Tower building.

“What target should we have taken for the height of the tower?”

On analysis, we had:

Height achieved: 25

Goal Set: 22

History: 17, 22

Potential: 25+ by general consensus

Should not the goal set be always higher than the potential that we have? Else the goals achieved will always exceed the goals set. The challenge for working may go down and lead to mediocrity all round.

We also discussed about the Pygmalion concept which is the phenomenon which states greater the expectation placed upon people, the better they perform.

The Pygmalion concept is a self-fulfilling prophecy i.e. a positive spiral, suggests that our potential to do something must always be expected to be greater and accordingly we should set our goals high.

Hence, the ideal relation between the goals set, achieved, history and potential (over a period of time) should be as below:

Thus, setting goals correctly could actually help us realize our actual potential and help individuals lead fuller lives and at the same time, help organizations realize achievements that were hitherto seemingly impossible.

Stay tuned for more such amazing concepts…

Towers of Learning

After the bizarreness of Day 1 of the POM lecture, we waited in anticipation (?) for the next one. What would this day bring? Would it be more of the same or was Day 1 just a one-off case.

The lecture was scheduled after lunch and we all settled in class after a hearty meal, ready to doze off. In walked Dr, Mandi to the class and we stood up, not knowing whether to settle back in or are we supposed go and sit on the floor as earlier. But, a wave of the hand and it was clear. Back to the floor it was...

As we settled down on the floor, Dr. Mandi started throwing some things at us from his ‘potli’. They turned out to be cubes, children’s building blocks. Once we caught a few blocks, he emptied his bag for a bunch of the blocks. Next, he threw a question at us: can we build a tower out of the blocks.

“Of course”, we said.

“How tall?”

Different answers started coming up. 25, 30, 32…

He asked us to come up to the dais and build one. Many hands went up.

“But not so easy. There will be an entry fee to come up and build the tower. Put your money your where your mouth is!”

The hands went down. But a few brave souls ventured and there was a bidding process and finally, one person came up to build the tower (paying Rs. 500 to the class CR!). He was asked his target and said 14 blocks. Another discussion went about on this topic.

And the tower building started. The tower went up to 22 blocks and finally collapsed.

Then Dr. Mandi asked whether a pair of people could do it blindfolded, i.e. one person blindfolded and one other guiding him. After thinking about it for some time, we began placing our bets and finally, a pair came upon the dais to build the stack.

Then began the actual class.

This was a case in point of difference between old and new management. The person without the blindfold was a case of old management and the ones with the blindfold was an analogy of how new managements work. The difference can be summarized as below:

Old management(open-eyed person)	New Management(blind-folded persons)
Consists of a single person	Consists multiple people
Wants open eyed, thinking people	Wants blind people at lower level
Leads to greater satisfaction	Leads to greater production
E.g. Craftsman	E.g. Production

Dr. Mandi told us that the pair of people building the tower represented the new way of management wherein the blind folded person represented the lower operational class and the one guiding him represented the upper mangerail task.

Accordingly, the operational person would do only what the manager would tell him to do and would work fearlessly as he had no fear of failure. The manager would not be burdened by the actual act of working but would play the role of implementing the strategic plans of the top management. Consequently, due to the work division, in such a model, the productivity of the process would increase drastically.

Accordingly, he asked now how much do we think that the tower by blind-folded person would go up to. The answers were still pessimistic, upon which he told that on the principles that he had just taught the tower should be more than that done by the open-eyed person, i.e. the tower height should exceed 22 blocks.

And with this in mind, the pair of manager and worker began their job. And what do you know, they did it! They made a tower 25 blocks high with a blind folded person being helped by the open-eyed person.

The learning from this activity as illustrated below that provide a clear-cut distinction between the two schools of management.

Parameter	Old School Of Management	New School Of Management
Work	The entire work is done by just one individual.	Work is shared between two persons. The physical work is done still the one individual but the work/effort in terms of strategy to place the blocks, directions for placing the block etc is transferred to the other person.
Division of Work	One person is loaded with the entire work.	The technical and the functional work are separated.
Skill	If a single person is performing the activity, a high level of skill is required from him.	When two people are performing the job low skill if required effectively from each individual.
Innovation	Innovation can come from just one individual.	Innovation can come from the “performer” as well as the “supervisor”.
Productivity	Productivity is low.	Productivity is high.

Management is at its very basic level, breaking a work down to its elements and handling those elements.

Work -> Job -> Activities -> Tasks -> Elements

 An effective manager is a person who is able to break down the work in this manner and then handle the smaller elements effectively.

Thus, using a simple game of towers using playing blocks, Dr. Mandi explained the concept of different styles of management in a very interactive manner.

More this on the way, I hope…