Interview with Azim Premji
Knowledge@Wharton has an interesting interview with Azim Premji. Some excerpts:
“Aron: What demands do these new businesses make on your senior management? And what are you going to do to make sure that they are ready to meet those challenges?
Premji: Our managers need to have a strong integration of managerial skills and technical understanding. One cannot substitute for the other. That is not an easy combination to get, especially if you want to sustain growth. Technical people tend to be more "techie" and management people are more "managerial." To have strongly integrated managers who have a deep understanding of technology is a rare and difficult combination to build. You have to invest a lot in selecting and training these people.
Aron: You made an interesting observation about the difficulty of having technical folks do managerial work, and how it makes growth a challenge. This brings me to a question that is often asked about Indian companies. Today, Microsoft's revenues are more than 20 times Wipro's revenues. In your mind, do you see Wipro growing to the size of Microsoft or IBM?
Premji: It would be reasonable to assume that Indian services exports in IT and in BPO will grow cumulatively for the next five years at about 35%. They are now growing between 23% and 25% a year. I do not see any reason why leading companies like ours cannot grow faster than the growth of exports from India. After that, it is a matter of interpolation and desire. Do you keep scaling the organization? Do you use high-leverage models? Do you use productivity tools so that your headcount doesn't increase as fast as your revenues do? That is what we are trying to achieve, and it is not an easy challenge. How do you build maybe 8% productivity growth a year in your business model? To do that, you have to grow 8% a year in terms of revenues with the same headcount, or to grow 16% in revenues a year but with just an 8% increase in headcount.
Knowledge@Wharton: What leadership qualities do you look for in executives you hire at Wipro?
Premji: We have defined seven or eight leadership qualities. We have defined those because we needed some consistency in terms of what we measure against when we recruit; what we measure against when we promote; and what we want our training to be oriented towards in terms of the skills and competencies we want to build into people. Pratik, could you add more about the leadership qualities?
Pratik Kumar: We look for people who can work effectively in an unstructured environment, who have great adaptability and who can be reasonably comfortable in situations that are not crystal clear and where there is a level of ambiguity. We also recruit people who have a lot of self-initiative because these are qualities that will lead them to succeed in our kind of environment.
In addition, we have a clearly crafted list of leadership qualities with which we measure our own managerial talent and I will touch on those very quickly. One is customer orientation, because we believe that for an organization to be successful, this is a particularly important rule. Strategic thinking is becoming more and more important; we need people who can balance short-term and long-term goals, and who are ready to sprint and run a marathon at the same time.
Self-confidence is another quality that I think is becoming increasingly important. Many people have spent their whole lifetime working in environments which have been predominantly Indian. When they have to deal with people from different cultures and with different styles, it is important to see how well they are able to hold their own. Self-confidence also means your ability to take good news as well as bad news. How well are you able to do that? That is another important element. Other important leadership qualities we look for are commitment to excellence, willingness to groom other leaders in the organization, and the ability to work in teams. All these qualities are interwoven in everything we do in the organization.”
IMHO: Premji talks on a broad range of topics, from Wipro’s differentiation to the effect of & reason behind their recent restructuring. To me, two things stood out—one, his focus on correct recruitment & growing leaders from within, and improving productivity AND innovation. I have talked about how productivity will become a critical factor earlier. It is no longer an either-or situation between innovation and productivity; organizations need to manage to do well on both counts to thrive. Teamwork is another key challenge facing the Indian IT companies. More about this later.
Premji: Our managers need to have a strong integration of managerial skills and technical understanding. One cannot substitute for the other. That is not an easy combination to get, especially if you want to sustain growth. Technical people tend to be more "techie" and management people are more "managerial." To have strongly integrated managers who have a deep understanding of technology is a rare and difficult combination to build. You have to invest a lot in selecting and training these people.
Aron: You made an interesting observation about the difficulty of having technical folks do managerial work, and how it makes growth a challenge. This brings me to a question that is often asked about Indian companies. Today, Microsoft's revenues are more than 20 times Wipro's revenues. In your mind, do you see Wipro growing to the size of Microsoft or IBM?
Premji: It would be reasonable to assume that Indian services exports in IT and in BPO will grow cumulatively for the next five years at about 35%. They are now growing between 23% and 25% a year. I do not see any reason why leading companies like ours cannot grow faster than the growth of exports from India. After that, it is a matter of interpolation and desire. Do you keep scaling the organization? Do you use high-leverage models? Do you use productivity tools so that your headcount doesn't increase as fast as your revenues do? That is what we are trying to achieve, and it is not an easy challenge. How do you build maybe 8% productivity growth a year in your business model? To do that, you have to grow 8% a year in terms of revenues with the same headcount, or to grow 16% in revenues a year but with just an 8% increase in headcount.
Knowledge@Wharton: What leadership qualities do you look for in executives you hire at Wipro?
Premji: We have defined seven or eight leadership qualities. We have defined those because we needed some consistency in terms of what we measure against when we recruit; what we measure against when we promote; and what we want our training to be oriented towards in terms of the skills and competencies we want to build into people. Pratik, could you add more about the leadership qualities?
Pratik Kumar: We look for people who can work effectively in an unstructured environment, who have great adaptability and who can be reasonably comfortable in situations that are not crystal clear and where there is a level of ambiguity. We also recruit people who have a lot of self-initiative because these are qualities that will lead them to succeed in our kind of environment.
In addition, we have a clearly crafted list of leadership qualities with which we measure our own managerial talent and I will touch on those very quickly. One is customer orientation, because we believe that for an organization to be successful, this is a particularly important rule. Strategic thinking is becoming more and more important; we need people who can balance short-term and long-term goals, and who are ready to sprint and run a marathon at the same time.
Self-confidence is another quality that I think is becoming increasingly important. Many people have spent their whole lifetime working in environments which have been predominantly Indian. When they have to deal with people from different cultures and with different styles, it is important to see how well they are able to hold their own. Self-confidence also means your ability to take good news as well as bad news. How well are you able to do that? That is another important element. Other important leadership qualities we look for are commitment to excellence, willingness to groom other leaders in the organization, and the ability to work in teams. All these qualities are interwoven in everything we do in the organization.”
IMHO: Premji talks on a broad range of topics, from Wipro’s differentiation to the effect of & reason behind their recent restructuring. To me, two things stood out—one, his focus on correct recruitment & growing leaders from within, and improving productivity AND innovation. I have talked about how productivity will become a critical factor earlier. It is no longer an either-or situation between innovation and productivity; organizations need to manage to do well on both counts to thrive. Teamwork is another key challenge facing the Indian IT companies. More about this later.
posted by Anurag at Tuesday, April 18, 2006
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