Leadership

The TCS Story – Q&A with Vice-Chairman S. Ramadorai

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I’ve known S. Ramadorai, vice-chairman of Tata Consultancy Services, for 20 years and greatly admire his leadership and success. Ram, as he is popularly known, played an integral role in the international development of TCS. He places high value on relationships, and part of his leadership style is to be very involved in listening to customers. He personally came all the way to Tucson, Ariz., in 1991 to meet our executives to build the relationship with our company. Back then, TCS was a US$10 million company; the company generated consolidated revenues of US$8.2 billion for the year ended March 31, 2011. Yet his values have not changed. The culture of TCS that Ram created is built to last.

Ram describes the TCS culture and history in his book, “The TCS Story … and Beyond” (Penguin Books, 2011) and chronicles his time as a young engineer in 1972 and as CEO from 1962 – 2009. The book is packed with interesting inside stories about the development of the IT and software business in India along with unique leadership insights from one of India’s most respected business leaders.

SandHill.com: In your book, you share a lot of insights about how your mindset as a CEO developed. You specifically referred to three aspects: risk taking, building relationships and having extraordinary patience in dealing with challenges. Which of these do think is most important?

S. RamadoraiS. Ramadorai: In my opinion, all the three attributes are extremely important. The risk taking comes with two aspects. First, the age profile of the CEO; the younger one is, the more opportunities there will be for risk taking. Second, risk taking comes with the ability to accept failure and also own up to responsibility for failures. This is often overlooked because people are used to passing the buck.

Patience is important as one comes across all kinds of people in professional life. One must be able to understand and tolerate multiple viewpoints, multiple opinions and sometimes even challenge others. An idea that may seem to be irrelevant may become the best idea at some point in time.

SandHill.com: What do you think most contributed to your own success as a leader?

S. Ramadorai: Team-building and also demonstrating by doing … lead from the front. It involves taking responsibility for all the actions and being very clear and transparent with people. It also involves connecting with multiple layers of the organization face to face or through technology.

SandHill.com: What do you think most contributed to the success of TCS as a leader?

S. Ramadorai: TCS invested proactively in technology as well as in skilling and training people. Investing in empowering people with the right technology framework for control of data in real time is most important. Proactiveness and willingness to take on risks are necessary to build an enterprise.

SandHill.com: You wrote that your book telling the TCS story is meant to be an inspiration. And I certainly agree that it is. Please tell us about a company that inspired you as a model when you were growing up or in your university years.

S. Ramadorai: The Tata Group has always inspired me. But apart from that, organizations like IBM, Hewlett-Packard and some of the other technology companies definitely had an impact on me. I was also very impressed with GE as a process-oriented organization in addition to some of the other professional bodies like IEEE. These were all very important institutions that inspired me during my university years.

SandHill.com: In the book you describe a time when “It was apparent to me that TCS could no longer function as a startup where everyone knew everyone else and people handled multiple functions.” What is your advice regarding how a startup founder/CEO can recognize when to make that transition?

S. Ramadorai: I think there is nothing like “when to make a transition.” The day the CEO is not able to connect with people to the extent he/she did yesterday is an issue. The CEO should have put together a structure so that a connection with people is not lost. Proactive connection with people, either through technology, directly through an empowered set of people whom you trust, is extremely important.

SandHill.com: You wrote about a time when you felt your core team was too grounded in operations so you brought on board a Harvard Business School professor as your strategic planning advisor so that you would have insight from the outside. Please tell us about a few of the small but important “outside” insights he brought.

S. Ramadorai: Professor Ghemawat made us realize the importance of the customer interface, how to externalize our offerings from a customer’s point of view rather than assuming that our offerings will always meet the customer’s requirement. That was a very important insight.

The second insight he brought us was the concept of strategic thinking, where he encouraged us to build domain competencies beyond technology competences.

The third was the element of the brand that had to be built based on the core competency in terms of delivery excellence and the brand promise we wanted to abide by. In fact “Experience Certainty,” our tagline, emerged out of this very strategic dialogue.

SandHill.com: What was the most difficult aspect of changing from a centrally controlled organization to a decentralized organization?

S. Ramadorai: I think changing from a centralized to a decentralized organization was an absolute must. It had to be managed through group sessions, building a very strong team of people who believed in that approach, coaching them, mentoring them, and by creating a digitized environment with an empowered set of people who would not be scared of making mistakes.

SandHill.com: How did you manage the change in switching to a decentralized organization? Did you encounter change resistance?

S. Ramadorai: By sheer belief, hard work, communication and repeating the same messages on a continuous basis to reinforce the message in the minds of the team. It is also important to make yourself accessible to people, so that they feel most comfortable while sharing the real problems with you rather than what the boss wants to hear.

During any period of change a leader always encounters resistance; but being a young organization where the average age group was 23-25 years, it was easy to meet people and convince them. Engaging with the people at the ground level or at the grass roots level across different parts of the organization on a continuous basis is the only way to empower the younger generation.

SandHill.com: You wrote that green tech will be the driving force for future innovation. Do you think it will be a dominant driver in most organizations, or just those on the cutting edge of creating the next big thing? Do you believe this will be pervasive in 10 – 15 years, or will it take longer?

S. Ramadorai: It will be absolutely pervasive where economic and ecological well-being of any institution is going to be the way of life. Silently, organizations are putting together ecological parameters, i.e., usage of land, water, waste, air and carbon very clearly. Compliance frameworks in addition to the economic compliance would be a way of life and I do not think it will take more than the next decade or so.

SandHill.com: Is there a non-TCS person whom you admire, who influenced you other than the people you mention in your book?

S. Ramadorai: To start with, my father influenced me quite a bit. He helped strengthen my fundamentals in basic mathematics. Other names that come to my mind are Mr. Palkhiwala, Mr. JRD Tata and Mr. RNT. Even Mr. Kohli has inspired me a great deal.

SandHill.com: What is something you’ve wanted to do that you haven’t yet done?

S. Ramadorai: I have always wanted to learn to play the mridangam [ancient drum used in classical South India music] and play more golf.

SandHill.com: Is there anything that surprises you about today’s business environment?

S. Ramadorai: The one thing that surprises or worries me the most is the short-term focus with no long-term R&D or investment, which leads to breakthrough and disruptive innovation. All organizations must look at disrupting themselves for the future before someone else disrupts them.

Royalties earned from “The TCS Story … and Beyond” will go to TCS Maitree’s skill initiatives for the physically challenged.

M.R. Rangaswami is co-founder and CEO of Sand Hill Group and the publisher of SandHill.com.

Comments

By Raja Nagendra Kumar

It is very nice see TCS grow .. however can it sustain in next 10 years on the age old (2 decade) bodies model

Mr S Ramadorai, do you see the need for Services 2.0 (i.e transformed version of current Services 1.0 model), which can possible address many of the challenges which IT services going through now.. Specially revenues can’t scale without destruction of clients business by providers asking for continuously bodies and time approach and clients asking for unrealistic hourly rates and time lines to meet their budgets

i.e we need to give due respect for Innovation and excellence at business level so that many problems can be addressed with ease.. The way $ flow.. society culture evolves..

Few of the enables I see in Services 2.0 for innovation are
1. Reducing the Number of resources as opposed to lowering of hourly rate
2. Not charging customers on bugs and regressions
3. Not charging customers on Manual and Automated QA efforts
4. Fixed resources guarantee throughout the contract period
5. Agile for every two weeks etc.. in place of T&M or fixed
6. No to fire fighting
7. Innovation income to providers (doing things faster)
9. Accountability Excellence reflected in last mile (release time)
10. Easy ways to find and replace resources
11. Use Consultants and Specialists as opposed to just limiting to static knowledge employees
12. Process which can show 4 times more productivity in the form of 1/2 the time, at 1/2 the resources
13. Cost of Technical Debt created by providers is addressed at free of cost to customers

I know clients are not directly asking.. but it is told in many forms such as Indian IT is a cheap labor, hence clients does not expect great work, Outsourcing is really not cost effective at the end, we saying it is very hard to grow the organization with high skilled resources etc..inspite of the best brains of India.. or clients feeling that mostly fresher’s are used to deliver

May be if this comment attracts you attention, I would like to present our detailed observations on what is privately known to everyone but untold in public IT Services model.. Would be happy to connect to TCS, if open to drive Services 2.0 at leadership level

Regards,
Raja Nagendra Kumar,
C.T.O
http://www.tejasoft.com
Factor 4 Benefits : Halve the Efforts, Double the Results

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