Why systems alone cannot prevent adverse outcomes?
On February 7, I met with Mr. Ratan Tata at Kstart Capital during the Billion Aspirations summit. I am working on a more detailed report on the words of wisdom that emanated from him. However, I wanted to give you a quick update on a very important thing that he touched upon.
I am a huge fan of the American TV show Undercover Boss. It stuck a nerve with me because it emphasized the need for an enduring culture, and sharing of values across an organization.
So, I asked him if he feared the culture and values of Tata companies are not enduring and if there are enough safeguards. His response was simple yet revealing.
He gave me an anecdote from his own experience. He faced a situation where a senior executive embezzled a significant amount of money from one of Tata’s companies. The first thing Tata did was to plug that hole. I think this shows his fortitude and character. He said he then faced an unsavory choice between brushing this matter under the carpet and taking it head-on. With the latter he risked facing a backlash in media. Inspite of that he chose to take it head-on and be transparent. The executive was prosecuted amidst wide public scrutiny as expected.
He continued saying there is always a choice between doing the easy thing and doing the right thing. Mr. Tata chose the latter despite it being a less favourable option. Because, this reinforces the values of the company. He said, about this incident,
the company is clean but the person is not
So, ensuring the culture and values endure is much more than just establishing institutions. In his words,
a person’s DNA always makes a mark on an institution
And, there is no escaping that. So he said he is not fearful about the endurance of his companies’ culture and values because doing the right thing when faced with tough choices will reinforce those very values a company stands for. As long as that is done the culture endures and the organization thrives.
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A version of this article is originally posted here.
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