Former Editor and MD of Harvard Business Review and Chief Marketing & Knowledge Officer, Booz & Company, Thomas Stewart offered answer for these waxing questions. Addressing a seminar titled 'The Leader's Agenda' in Mumbai on November 13, 2008, Stewart said, "Speed, changing customer expectations, uncertainty, and extreme competition is what leaders need to focus."
Tom started with the global scenario saying "Power" is moving from West to East and earlier the demography of East, which was once considered as liability is paying dividends now. He also stressed on the fact that decoupling of national economy is myth.
He mentioned the economic meltdown has important strategic implications and gave five points to focus on:
- Focus for the future
- Get Prepared
- Define the future Industry structure
- Decide your position and competitions
- Take intelligent risks
His view is that instead of going back to core business one should go back to Core Strengths.
From here moved on to the part 1 of this 'Five Challenges for the next Five Years':
1. SPEED: It challenges our ideas about decision making and it's is every where
a. Product Innovation
b. Customers
c. Communications
d. Capital
e. Speed to scale
The pace of business is faster than it ever was, and shows no sign of slowing down. For those who can keep up, that means more opportunity then ever.
2. Fuzzy Boundaries: One organization actually doesn't know where it's involvement with the product begins and ends. In any given product 40% to 90% of the components are outsourced.
These days, businesses are complex webs of outsourcing partners, joint venture partners and others who won't necessarily pull in the same direction.
3. King customer: Customers are getting more and more knowledgeable and its direct impact is on profit margins.
Customer takes away profit if organizations don't develop capabilities driven strategy.
4. Extreme Competition: Here 3 stages of Globalization come into picture.
a. Globalization markets – selling everywhere (Theodore Levitt, HBR,1983)
b. Globalization sources – buying or building where it is most advantageous (Thomas Friedman, The World is Flat, 2005)
c. Globalizing the intellect of the company –going where the best brains are (NOW)
5. Uncertainty: Leaders tool kits are well equipped with ways to control process, allocate resources and calculate risk. But these techniques aren't enough.
Part 2 of Tom's address was focused on 'The Wealth of Knowledge' which outlined Strategy and Management in the Knowledge Economy.
The pillars of the knowledge economy are:
1. Knowledge is what we buy and sell
2. Knowledge assets separate winners from losers
3. Knowledge defines our work and describes what we do
4. The returns to knowledge should exceed the returns to any other investment.
In the final part 3 of the address, Tom spoke about 'The Test of a Leader'. He outlined five steps.
1. The Initiation: Everyone watches the first moves a new leader makes. And new leaders almost invariably make major mistakes – even at senior levels. And hence leader has to prove his credential again and again
2. The Battle: Sooner or later, a leader has to fight – and in most cases to choose whether to fight this battle or wait for another one. It is always a high stakes test. Victory usually ads to power. They have to take "Decision of Political courage or Political Suicide"
3. The Defeat: Every leader fails. Great leaders accept defeat or failure gracefully and find a way back.
4. The Rebirth: Every leader faces the career equivalent of the seven years itch – the moment when he must ask, 'Where do we go next? If were applying for my job today, would I hire me?". How leaders come out of failure and last for decades
5. The Truth: The ultimate test of a leader is the test of the mirror. It is not just the test of authenticity, though that's partly it. It is a test of truth. Do others tell you the truth? And do you have the courage to listen truth.
Later, in an exclusive chat for MBAUniverse.com, Thomas Stewart said Indian Software Giants will not be impacted by higher brain costs because they where not World Class because of cost advantage alone. There advantage was coupled with Quality. Quality always matters, he said.
For other industries he had a view that Economies of Scale will be very important and merger and acquisition will be the order of day. But again cultural integration will be paramount. In the growth phase cultural integration generally get overlooked but in the melt down period it can make all the difference.
Muhamed Muneer, CEO of Customer Lab and author also spoke on the Challenges for Leaders in India – Execution Excellence.
He summarized his findings on the key challenges for leaders in India based on his survey as follows:
Communicating Strategy 73%
Executing Strategy 69%
Recruiting& Retaining Talent 66%
Managing Intelligence 65%
Strategic Alignment 60%
Creating Long Term Value 57%
Keeping Customer Loyalty 54%
Cost Leadership 54%
Going Global 44%
Known as a pioneer in the area of Knowledge Management and Leadership development, Thomas Stewart was also the Editorial Director of Business 2.0 and a member of the Board of Editors of Fortune. In a series of Fortune articles, he pioneered the field of intellectual capital, which led to his groundbreaking book, Intellectual Capital: The New Wealth of Organizations, The Wealth of Knowledge: Intellectual Capital and the Twenty-first Century Organization. Mr Stewart is also a Fellow of the World Economic Forum.
The seminar was organized by knowledge management company Innovative Media. India's leading management portal MBAUniverse.com was the Official Management Portal of this seminar.
