Tuesday, June 03, 2014

It's actually "Competence v/s Loyalty"

Recently there has been quite a bit of debate on the issue of Smriti Irani becoming the HRD minister of India and it was amusing to see that people are concerned about the fact that she has barely completed her schooling.

Too much focus on her qualification is preventing a more crucial discussion that of whether competence should be preferred over loyalty by leaders. 

There is universal agreement on the fact that qualification and wisdom/intelligence are two separate issues and that they surely are not positively correlated. In simple terms a holder of multiple degrees could be equally dumb/incompetent as an illiterate person and ma
often illiterate people can be very wise and intelligent too. So one does not mind Smriti being tried as a minister even if her educational qualification does not match up to the task. Her sincerity needs to be watched before brushing her off in the seat of the HRD minister.

Lets shift focus to the central theme of this post - A more important question to ask is - Would Mrs. Sushma Swaraj have become a minister had she lost election in the same way as Smriti Irani and Arun Jaitley did. Here then lies the irony of the situation. Lets ask ourselves, What is more important in making a choice of team members - loyalty or competence. 

Lets start with a couple of examples - a very successful midsize software company the founder-CEO of which stays in the USA and manages business development leaves the operations and administration of his entire company in the hands of a rather mediocre Engineer who has been working with him since last 20 years and started as just an administration executive because he was unable to get a better job after his graduation. Over the years - the CEO found him to be a man he could trust with company information and also his stability was not under doubt unlike many other more competent people.

Another - a very influential and large newspaper  from one region starts its edition in another region pitching itself against the regional leader in the industry. But whom does it give the administrative control of the entire operations - to a rather old hand who has little understanding of either marketing or journalism - but the owner director of the company has full trust in his allegiance to himself. While the management appoints rather competent people in the editorial and marketing teams - they all report to the management through this rather mediocre COO.

I am sure you also know many such leaders/organisations where we wonder - why a rather mediocre and sometimes outright incompetent person holds a key responsibility. The only explanation is unflinching loyalty to the leader.

Back to the Modi Sarkar, There is validity in the argument that there are probably more competent people in BJP itself for the specific post of the HRD minister (which is true of  few others ministers as well notably Ram Vilas Paswan, Uma Bharti, Harsimrat Kaur Badal, Dr. Harshwardhan etc). And some people may feel surprised that a leader, who everyone hopes will change the face of India by hopefully delivering prosperity for all Indians, must depend on less competent people as his team to deliver. Yet, there is another side to the coin as it invariably always is the case.

Look around yourself. Most leaders (and not necessarily - political leaders alone) need a core team that is loyal to the leader sometimes to an extent that defies logic. These team members hold key responsibilities that may be far beyond their competence. The leader can easily afford better, more efficient people. And yet, people who are invariably loyal to the leader are preferred - whatever be their competence. The leader at times of crisis depends on them. They are ready to sacrifice themselves for his cause. Of course they get rewarded when the going gets good. Mr. Amit Shah or Anandi Ben Patel and now Smriti Irani are good examples of such followers of Modi (though mr. shah should in all fairness be considered highly competent for the jobs Modi gave him). 

However - A leader can not do without competent people - how else would he/she deliver. The problem with a competent team often is that they become competitive as well. Individual intelligence does not let them easily accept collective wisdom. Each individual has strong opinions as well as strong conviction on one's own opinion and they would not balk down from openly disagreeing with the leader creating difficult situations for the leader. They sometimes are lured by the outsiders and they often switch sides because of either better growth prospects or by the promise of more authority/autonomy or because of that most dreaded reason, their leader facing tough times,even decline.

My experience, admittedly limited though, says there is a pattern. A good competent team led by an able motivating leader creates success - aim for the sky - Either differences between core team occurs or the they face tough times. Either ways the team gradually scatters away as individuals move away and differences become strong. The leader starts according premium to loyalty - competence is short changed - the team is into a downward spiral thereon.

The above sounds like the congress over the last few decades. Some might even like to say that AAP is a microcosm of the same pattern. Infosys, post Narayanmurthi and Nandan Nilkeni is showing some early signs of the same pattern. 

Mind you, I am not suggesting that this eventually will lead into degeneration or failure of the leader - on the contrary there are many examples of leaders who have remained successful despite their single minded preference to the loyal over the competent. The two examples of a software company and of the newspaper are cases. another great example is our own Birla group.
Of course for a leader to be consistently at the top - he/she needs a competent team as well as their unflinching loyalty for the leader. Such a leader is invincible. To some extent, Modi has been an example of this. ICICI's ex-chief Kamath is another such example who built a formidable team of cutting edge professionals who stuck with them till the very last of his days at the ICICI. 

But in the recent history, the only example of a leader who created a team of strong individual leaders and let them independently lead the group to great heights, has been J R D Tata. Under his leadership the Tata Group produced some of the all time best leaders (Sumant Molgaonkar, Nani Palkhiwala, ironically a modi too - Russi Modi) all of whom were absolutely competent and strong individuals in their own right - sometimes to the extent that they would differ in opinions with their leader too. 

There is no question that Modi has thrived on the loyalty of his team and there is no doubt that this cabinet is a stamp of approval for his loyalists. Posterity will judge whether Modi's  cabinet was a team of competent people too. If Modi finally turns out to be the leader that he has been painted into - the team better turns out to be competent. Only time will tell what type will Modi turn out to be. What do you think?