Lean - and the Power of ‘Why?’

Precocious kids ask it. Scientists ask it. Philosophers ask it. Inventors ask it.

‘Why’?

It is the question that lies at the core of the principles of Lean. And it is a question that I have adopted as my personal mantra as I bring ‘curiosity’ in every aspect of business and life! It pushes me to ask “Why?” in anything that I see, anything that I experience - “Why do some transactions or processes perform so well? Why do others not?” “Why is this clients’ method of operating failing?” “Why is this client experiencing losses?” Over and over and over – “Why?”

And Lean and Six Sigma have always had the answers. Every day in our lives, in our business, in our operations and in customer interactions, there are opportunities to bring Lean thinking to drive improvement and value. The examples are all around us – a hiring process that takes too long, a customer service process that does not resolve a problem the first time round, delays and unnecessary money-wasting hold-ups. The Power of Lean thinking lies in the fact that it addresses all these questions – delivering utmost value from a customer’s perspective while consuming fewest resources. Powerful Lean principles such as ‘reducing lead time’, ‘reducing waste’ ‘driving continuous improvement’ ‘improved quality’ impact customer satisfaction and customer results positively – no matter what the situation is… always bringing in positive business outcomes such as increase in market share, reduction of costs, increase in profits - driving competitive advantage…each time, every time.

In fact Lean is a culture – the way we work, the way we do things, the way we deal with problems. Lean is all about creating an integrated system – a process – where it’s no longer about having efficiencies in individual silos…it’s about how all silos work together efficiently to bring in unprecedented value, end to end – bring in agility and flexibility.

But nothing works or makes sense unless it begins from the customer’s point of view. This is all-important and sacrosanct when one begins the process of attacking any area of improvement or opportunity. Never forget this. It is the way a leader has to think, it is the only way to successfully run a business. You have to know what your customer wants, ask all the ‘whys’ and then constantly look for causes that, when attacked and addressed, will drive improvement.

Our world is changing, our clients’ business needs are changing, processes are changing – and there are trends that are impacting not only the way our clients are thinking about the industries they are in and the customers they serve, but also how they run their businesses.  As companies continue to operate in a volatile, uncertain and lower-growth world, they are forced to completely transform their businesses by making them more nimble, with cost structures that are lower and much more variable. They are looking at adopting digital technologies, implementing new business models, creating new organizational structures, and making their processes more intelligent. And above all – they are looking for partners who can help them navigate their transformation journeys. Partners who truly understand their domain, their industry, their specific processes, the inter-linkages, the risks and the leverage points in the business. In other words, someone who aligns activities to business outcomes and speaks their language…helps them improve and grow in this ever-changing world…and this is exactly what ‘Lean’ thinking helps us do!

We launched Lean Digital last year - this is our unique approach that reimagines our clients' middle and back offices to generate growth, cost efficiency, and business agility. The feedback we are beginning to receive is that Lean Digital is a game changer that builds on our strength of using Lean principles to drive disruptive improvements. At Genpact, this launch has been the culmination of many months of building our digital smart enterprise process frameworks and getting a number of our key project and improvement leaders trained on specific Lean Digital capabilities. We now have a digital certification program for Black Belts and Master Black Belts that we are also taking to clients. For example, at one of the largest global banks, our Lean and digital experts are designing automated solutions leveraging new technologies for underwriting, customer service, and fraud detection, all critical areas for the bank and its customers. We are getting great initial feedback on the way the teams are reimagining the solutions and how other banking processes will run in the future. These are industry disruptive!

What is the richest reward for me at the end of the day? When a customer says - “We need you to help us reimagine our business, dramatically change outcomes – disrupt everything,  redesign our process and show dramatic improvements; no one knows better than you, work with us and I will pay for it” - there is no greater testimony to success than that. Lean defines us, it’s in our DNA and culture. It is a way of thinking for all our employees; it is a way of running a business. It is constantly looking for root causes that, when attacked, will drive improvement.

And it continues to make us ask ‘Why?’ – At its core it’s asking questions and listening

As long as we continue to question, and push and reach and aspire and work harder and do better – so long will we continue to reap the benefits of Lean. And as I have often said – there is no better and more important quality and behavior that I think is needed in today’s world than ‘CURIOSITY’!

I will continue to be intensely ‘curious’, and I hope that you continue to be that way too.

Good luck – and keep questioning the universe!

Do you look for this trait while hiring?

Zig Zigler once very aptly said… “You don’t build a business, you build people and then people build the business”. It quite succinctly puts into perspective just how important people are to an organization and therefore just how important it is to hire the right people. I truly believe that it provides a disproportionate amount of support to the growth and DNA-building of organizations !!

At Genpact, we have always pushed for depth in domain. In addition to building a culture of learning where enhancing one’s skills – at every level – is actively encouraged, we also drive this in our recruitment by going for people who ‘really know their stuff’. 

But ‘really knowing your stuff’ comes packaged in a multitude of ways.

It’s not just about years of experience or how impressive a resume looks. There are a number of unique and dynamic traits that one needs to be on the lookout for, and know how to recognize, when one is going after new talent. This is what keeps a company agile and nimble to stay contemporary and navigate the changing landscape.

Award-winning author Maite Baron captures this shift in mindset in his book ‘The Rise of the New Entrepreneur’, where he describes the ‘SUPER+Generation’ as people “who are driven to succeed”. They are “energetic and passionate about making a difference, which frequently comes through in their innately entrepreneurial approach to life”. He is talking about people with drive and that ‘extra something’. Baron goes on to say that these are people “who don’t wait for things to happen, but who make them happen, which tends to make them more successful. They aren’t frightened to stand out and be different, which means they are independent thinkers, often with an unconventional outlook and approach”. Finally, he says that they “believe in making things happen through a collaborative approach, which is why they are relational, global thinkers who are able to see beyond “me” and “you” to “us”.

These are exactly the kind of people organizations should be looking to hire.  And often we find them in the most unexpected of places. We find them in resumes and profiles that don’t necessarily adhere to protocol… or check the traditional boxes on years of experience and skill set. 

Some of the best startups around the world are run by people with a fraction of the work experience we would typically look for in senior folks. Or else they come from very different backgrounds than the areas they are now excelling in. 

At Genpact, we really don’t need to look beyond our own corridors for proof that this thinking works. We have tons of examples of successful people taking on jobs where they didn’t have prior experience or enough years behind them and yet they have been terrific success stories. I can guarantee it that if we were weighed down by a person’s age or working background or a very narrow and specific skill set we would never have found these talented leaders.

So here’s what I truly believe about hiring – when you are interviewing, don’t focus merely on years put in or a pretty resume. Look also for someone with ‘boundless energy’! I know my leadership team at Genpact is fully aligned to this way of thinking – and is actively involved in passing it down, up, sideways, throughout the organization. Change has to happen in all directions and at all levels – in order to build up a juggernaut of people who are really going to make a difference.

When Need Meets Opportunity!

What is need? In some essential way, we are all needy. We are all ‘people who need people’ and people who need help of some kind or the other.  Sometimes, it is very easy to spot need. It is there, staring you in the face – which makes it easy to be able to extend a helping hand. But sometimes, need exists in a far more subtle manner – and is that much more difficult to recognize.

The story goes that the great mathematician Ramanujan struggled for years to get his work noticed outside of his small hometown. Then one day he wrote to the renowned British mathematician G.H Hardy, who immediately recognized his genius, paid for his tuition, put him on a boat to Trinity, Cambridge – and the rest is history. Ramanujan was not starving or sick or obviously suffering. But he had a gift, a passion, a genius that needed to be recognized and helped – and thankfully it was. Because what Ramanujan then went on to do was to contribute immensely to the mathematical world – and to young, hungry minds.

So one form of helping is direct - one-on-one help, that has a huge and positive impact on the individual. The other is what I call ‘leveraged’ help, which changes underlying conditions and structures, and creates a self-sustaining momentum once it is unleashed.
What am I therefore getting at? That there are obvious needs versus deep, underlying, structural, not-so-obvious needs - and therefore direct help versus leveraged help.

And this is where Corporate Social Responsibility (CSR) plays such a vital role. What is CSR and what does it mean for us? To put it very simply, it is a way in which we can recognize social needs– and do our part to help. Sometimes these causes are easier to see and therefore easier to address - like the eradication of extreme hunger and poverty or fighting diseases. But sometimes they are for more fundamental and underlying and not necessarily acknowledged as needy - like promoting higher education, pushing for gender equality, or empowering women.

The reality is that these are areas that are in desperate need of help and development - and the need varies depending on a bunch of factors, like geography, industry, culture and so on.  For example, India has the largest population of young people in the world. If this potential talent is armed with the requisite skills, we will be able to create a massive army of knowledge workers and skilled manpower. This, in turn, would augment our economic growth and usher in an era of unprecedented prosperity. At Genpact, we believe we can play an important role in accelerating this process. So we think our role is in the not-so-obvious structural areas, and in leveraged help that has a multiplier impact.

Take our tie-up with Ashoka University – we have created the ‘Genpact Centre for Women’s Leadership (GCWL), which is a unique, first-of-its-kind industry-academia partnership in the area of Corporate Social Responsibility. By creating a cadre of educated, empowered women we achieve two objectives – unleash the multiplier effect and benefit a whole new generation of women; and address the issue of gender imbalance in the workforce. Women need to be encouraged, supported, trained and helped in every way possible to be better at their jobs and better equipped to lead. And as you perhaps know – women’s leadership is a topic very close to my heart, and one I believe in and drive very strongly!! It makes businesses better and has a long term positive structural social impact!

Similarly, we have joined hands with the NASSCOM Foundation and IT-ITeS Sector Skills Council NASSCOM to launch ‘Reach Higher’ – a vocational skill-building program that aims to push the Government of India’s aspiration to train 500 million people by 2022. In my view this is a huge dream and a truly inspirational one. The program will equip aspirants with skills in specialized areas –all fully sponsored and at no cost to the aspirants. This is going to help create jobs and opportunities and effectively address the growing skills gap that is adding to the massive problem of unemployment in India. There are several such initiatives across the 25 countries that we are present in.

This, then, is our vision: to recognize underlying social needs, address them in a meaningful manner, and create a strong and positive social impact. This will, I am convinced, help create a better world for all of us to live in – and be proud of.

Curiosity: At the Core of Life!

In today’s world, if you’re not curious, you’re dead. If you’re not open to new ideas and aren’t able to change as rapidly as the world around you is changing, you will quickly become obsolete. And what is the one thing that enables one to adapt and apply… again and again.. to match the pace of change around us? Hunger to learn, driven by curiosity. And so, I would say that curiosity to learn through life is at the core of life itself!!

 

For the last couple of years, we’ve been going to the top 20 B-schools in the world to hire about 20 people into what we called the ‘Sales Development Program’.  They then undergo the right kind of training to emerge as sales leaders for the organization. It’s an investment that’s paid off well and we hope to increase the number soon.

 

In all my interactions with this group and in reviews with the teams that hire them, the one thing that stands out is the hunger to learn in each of them. They are hungry, very passionate, very motivated to learn and eager to contribute. I’m no authority on the subject but to me that isn’t intuitive to some of the traits that often this generation of Millennials is accused of – narcissistic, privileged, arrogant and so on.

 

As I mentioned in a NY Times article on the same topic, this is true for people we hire (or seek to hire) across different roles and regions. We place a lot of importance on energy, passion to learn rather than ‘do you know this specific aspect of the business.’ Because if one is energetic and eager to learn – picking up specific skills is never a challenge. We look for people who have an open mind and are curious. Because if you are curious you ask questions. If you ask questions, you will get a set of answers. And if you are reasonably clever, you will process those answers and come up with a relevant solution.

 

In my experience, if you demonstrate a hunger to learn, a capability to learn and a desire to learn – you are going to be successful. And often, I think that is better than someone saying that I know that thing really well. Because the reality is that, what they know is going to be worthless a year later as it will all change. Then the real question is that are they going to learn the new thing, grab the new opportunity and make it work for them. Does one have the self-confidence to accept the fact that what they knew is no longer important and that they are ignorant about the new thing. And it is okay to be ignorant for a short while till one learns the new thing!

 

It doesn’t really matter whether we are recruiting in US, India or Japan. The fact that we are looking for qualities of energy, passion and curiosity has to be brought out in the interview process. We bring the cultural nuance at the forefront of the recruiting process. And typically people with these set of qualities usually stand out in all cultures and it’s easy to recognize them.  

 

And I have had conversations with some of these people within one month of their joining. What they tell me is that the reason why they joined us is that they were looking for the kind of organization that feeds their hunger, that doesn’t curb curiosity, and that stretches and supports them to take on big challenges which you don’t find it easily. So then it’s a good match!

 

In a global world, do cultural differences really matter?

Most of you will disagree with what I’m about to say… but hear me out !!

I think we have to be careful about making the assumption that cultural nuances are so important that they negate business logic and rationality and a systematic way of doing things. So I would actually argue that this cultural conversation … in the geographic sense of culture and nationality vs. organizational culture… has become a bit too much.

If you walk into any one of our offices across the various regions globally , meet our people who are local people in the US, India, Japan, UK or Guatemala to name a few – you will realize that they all talk the same language , behave the same way in a range of situations , deal with clients the same way ….. Fundamentally have the same core VALUES !! . So you would probably scratch your head and say where are the cultural nuances?

Reality is that corporations and culture of corporations which are strong and well-ingrained cut across geographic cultural differences. Similarly, if the business value proposition and the solutions that we offer are strong and unique, they will cut across the cultural nuances. This is normally different from what we would expect to hear or believe or are taught via cross cultural models.

Having said that, there are certain cultural nuances that we need to keep in mind when conducting business in certain countries. For instance, we measure client satisfaction through the Net Promoter Score (NPS) methodology which is basically asking clients to rate our performance, the value we drive etc. on a scale of 1 to 10 where a score of 9 - 10 means you’re a promoter, 8 means you like me but are not ready to promote me yet, and a score of 6 or less means you are a detractor.

Talking about a specific instance in Germany – we saw a score of 6 (a detractor) and asked our client why she didn’t like our service. So the client's response was– “No! We love you guys and its great service! And that’s why I gave a score of 6!!” So we don’t easily get a score of more than 6 in Germany. Same story in Japan.

So I would say that while certain cultural nuances are important, but saying that a strong business value proposition doesn’t work across cultures is not correct. So we have to be careful that we don’t get overtaken by an excuse that something doesn’t work in a culture.

In the new world , with the combination of technology, social media , the hyper connected world , media , telecommunications and global travel – we cannot expect cultures to remain so distinct or in silos. There is significant inter-mingling particularly in the business world for sure and the language of business transformation and change is the same language.

Gender Diversity – Not just a tick in the box!!

If someone was to draw up a list of the top 5 priorities that companies are expected to focus on… I guarantee you that somewhere in the middle, right after ‘meet financial commitments’ and possibly before ‘data privacy & compliance’, we would see the words ‘gender diversity’.

It’s one of those things that organizations are supposed to solve for. We train for unconscious bias, strive for inclusive leadership, run sponsorship programs, set up diversity councils, track promotion and recruitment targets (while treading the thin line between ‘tracking’ and ‘quotas’!!) and finally write blogs on this topic J As cynical as my tone may sound right now, I do believe all of that is important.

But there is something else… that’s even more important than being focused on gender diversity. And that’s understanding why it is important to be focused on gender diversity. Sure it’s the correct and fair thing to do and plays a big role in being an equal opportunity employer. But as the CEO of the company, those are not the only drivers I consider when crafting company priorities.

Fact of the matter is that having women in leadership positions makes better business sense. Data proves that that gender diversity improves financial and talent performance.

Research from The Catalyst and NCWIT shows that companies with the most women board directors outperformed those with the least on return on sales by 16% and return on invested capital by 26%. Companies with the highest representation of women in their senior management teams had a 35% higher return to shareholders. On talent performance parameters, women outperformed men on 12 of 16 measures of outstanding leadership competencies as rated by managers, peers and direct reports. Also, a better diversity climate is related to lower attrition rates for both women and men.

At Genpact, our data shows that business verticals with more than 10% women in leadership roles grew significantly faster than those with the least women. On talent retention parameters, businesses verticals with a higher percentage of women in leadership roles did a better job of retaining other women compared to businesses with a fewer number of women.

And for these reasons as well as other reasons including the fact that clients are interested in how diverse we are, diversity is connected positively with innovation and an increase in women has been linked to a group’s effectiveness in solving difficult problems, we drive gender diversity even harder as a business-critical mission vs. a “nice-to-do”.

Our recruitment teams have aggressive goals of ensuring balanced representation of women in the talent funnel, our leadership development programs target at least 40% representation from women and our promotion data shows that we promoted twice the number of women vs men as a % of their populations/overall last year… obviously driven by pure merit but tracked to see how we’re doing. And finally, our operating teams drive our robust family-friendly policies like flexi-timings, work from home, day care facility, security measures and stork parking to make life easier for women which helps them focus on what’s important.

The results of these efforts are encouraging but far from where we want to be – 16% of our leadership (VP+) are women while representation is at 38% for the VP and below … while these numbers are on the higher side in certain geographies, globally we still have a long way to go. But it’s a fantastic indicator that we’re on the right path to creating a more powerful team that helps us meet our business goals.

And really – at the end of the day that’s what it’s all about. Not that there are any public naysayers out there… but this should be an eye opener for the closet skeptics who think driving gender diversity is a just a tick in the box.

What is the definition of 'Global Experience' today?

I recently learnt at a Centre for Talent Innovation (CTI) dinner that, 70% of senior leadership in the world used to have what can be termed as “global experience” in Fortune 500 companies about 5 years back. That number is only 20% today! Clearly… this is contrary to what one would expect. With growing globalization, opportunities and an ever-increasing demand for niche skills, the number should only go up!

So are leaders today really lacking global experience? That depends on what is the operational definition of global experience, which traditionally has been about traveling extensively or living abroad for work. That has now changed . The world has gone through periods of financial crisis - cost reduction and optimization have become important themes across organizations. Bringing in expatriate workers with niche skills is expensive and international travel has reduced significantly. At the same time, technological advancements and virtual presence have come up in a big way – knowledge can be shared virtually, team meetings can be held across geographies and time zones and the internet of everything will be a reality soon.

Take Genpact for example. As a global organization that designs, transforms and runs intelligent business operations for some of the largest Fortune Global 500 companies, we extensively use technology to stay connected and generate impact for our clients. We are virtual, yet very close to our clients… we are listed in New York, yet have offices and delivery centers around the world… our leadership is distributed, yet there is a standard way in which we serve our clients. Everything is possible and effective in the virtual world! We manage a lot of our cross country meetings virtually, we use double robotic automation to showcase our operational floors in India and China to customers sitting in the US and Europe, we are experimenting with how we can use Google Glass to improve field operations and use advanced speech recognition to improve client experience… much of this wasn’t possible 5 years back.

And therefore, we need to rethink the way we are measuring global exposure for our leadership and employees and really question traditional concepts of what constitutes as global experience.

US job report: stable is the new growth - unless talent mismatch is fixed

Amongst the many reactions to the recent Jobs Report, including President Obama’s warning that unemployment will continue to go up and down and that we need to create more jobs faster… I spoke to the WSJ over the weekend about what I think is the answer to creating more jobs – right-skilling.

Fact is you could have pretty significant unemployment rates but does that mean you find the people you want with the skills you want? The answer is no. There is huge demand for niche skills like regulatory, risk, new technology… and so on, and until we address the skills gap, we will see limited job growth. So while we’ve added 200,000-plus jobs for six consecutive months which is a consistent, steady clip and I prefer this any day over sinusoidal ups and downs – clearly it’s not enough.

The good news is companies have begun investing heavily in right-skilling existing and potential talent to combat such issues and are seeing pockets of success. We just now need to do it on a much larger scale, targeting the right skill sets.

Maniacal Client Focus… It’s measurable!!

There is not a single enterprise in the world that doesn’t have client centricity at the core of how it defines itself. What differentiates some from others is to what extent they take that client centricity.

The most extreme form is what we at Genpact call… a maniacal focus on clients!! By that I mean doing whatever it takes to truly delight clients… not getting bound by contractual obligations or service level agreements… but taking decisions that deliver value to the client even though the decision may hurt you as an enterprise.

Here’s an example. A few years back we started an initiative called ‘Destroy Your Revenue’ where we told about 200 people in the company who served a strategic client, that let's say your revenue is a million dollars a year. If they could come up with ideas that actually reduced the bill for the client (by eliminating work, finding ways to do it differently) then their revenue and the company’s revenue would go down, and that’s fine because we would have added value to the client. The initiative was a success and we got tons of ideas that contributed to actually destroying our revenue. Here’s what happened next… the client fell in love with us… gave us more business… and we grew faster than ever before!

Most importantly, being maniacal means going above and beyond customer satisfaction (which is basic hygiene) to turning clients into passionate loyalists for life. because as we all know companies that ignore loyalty tread thin ice when it comes to financial success!! Given the link between loyalty and increased market share… higher revenue… lower costs, it’s critical to invest time and resources into developing loyalty programs. Building loyalty is critical at any point, but it takes on added meaning in today’s volatile world. Customers are more fickle these days… their expectations are greater. An effective loyalty strategy is not merely about keeping customers at all costs… it’s about developing loyalty among the most valuable customers. Therefore, it’s important to constantly relook at and realign the strategy guiding loyalty programs… and align it to the organization’s marketing strategy … because attraction and retention of clients go hand in hand.

The way to do this is have a dedicated customer loyalty and retention function and then use the data from that program to form the basis of the strategy guiding it. And then define the customer lifecycle and align to it their loyalty and retention efforts. It’s not about revenue creation…it’s about creating value that leads to revenue creation!! Companies need to focus on building value for clients that turns them into true evangelists and advocates – research shows that loyal customers spend more, become brand advocates and are much less likely to succumb to the overtures of competitors – that beats any marketing strategy hollow!!

At Genpact, we invest heavily in measuring, monitoring and building client delight and loyalty, at a granular level. So twice a year, we ask about 5,000 people in our client organizations whether or not they would promote us to others. We don’t just ask ‘are you satisfied with what we do for you’ but ‘will you promote me and what we do to other organizations?’ This is the Net Promoter Score methodology which is based on the theory that ‘willingness to recommend’ is a strong indicator of loyalty and growth…because when clients recommend you, they’re putting their reputations on the line. And they’ll take that risk only if they’re intensely loyal and believe in your value.

We drive the NPS methodology and its learning across the entire organization in a very structured and granular manner and we’ve been doing this for several years now. In fact, NPS is the most important metric that business performance is measured on – it’s embedded in all our processes, depicted visually across the floors, forms the criteria for rewards and recognition and is ingrained in every employee. As a result, we are at a historic high of 64% NPS which puts us at 1.8x of the market average. A recent Satmetrix study showed that average B2B & B2C NPS across mid- senior- CXO levels has been in the range of 23-24%.

In fact we’re now taking the NPS methodology over to the employee side of things to measure engagement (vs. satisfaction) and use that as the benchmark of how employees measure us… how we prioritize employee investment… and it makes sense doesn’t it…Clients and employees actually exist in a virtuous circle, where one drives the other. Investing in employees and empowering them can lead to increased employee engagement and productivity, which results in superior service delivery. This in turn translates into higher client satisfaction and loyalty and thus improved sales levels and better business results. Re-investing some of the profits into employee development continues to fuel growth and brings us back full circle!!

The Trouble with Being Efficient ONLY!!

The problem with most companies is that they think only about efficiency. Don’t get me wrong, efficiency is great – you take cost out, get things done faster and are more productive – but it gets people only so far … it cannot get the juices flowing the adrenaline pumped up and the passion to come through …. It just cannot ! . There are stories after stories of companies that have driven productivity and then have hit a wall.

The real multiplier value comes when you drive effectiveness. So let me give you an example. Let’s take a standard hiring process of any organization. The real process that one should think about is not the hiring process but the end-to-end process that straddles the whole organization from the time you define who you want to hire for a job to ultimately the person joining and delivering and producing results. Think about what people spend time on in that end to end process. The hiring team is measured on their metrics: how quickly can they hire the right person. The training team is measured on their process: how quickly can they train. In reality, the right metric is end-to-end: How do you get the right person on the job that delivers effectively as fast as possible?

It’s quite likely that it is better to spend double the time on hiring because that allows you to spend one-third of the time on training and the probability of an effective person is higher and total end to end time shorter …. that’s effectiveness !!

But that’s not the way organizations are structured. Enterprises are structured as functions in silos. Processes on the other hand that delivers outcomes straddle from one function to another. There’s leakage of output in this straddle. There’s sub-optimization at the overall process level because each person who owns a function is trying to optimize their piece. It’s very difficult for organizations to get together and say we will optimize the overall process to produce the best outcome. And, by the way, the best outcome is not the total cost that I spend in hiring a person. It’s “I’ve hired a person who was effective on day two and produced fabulous sales on day five. And that, by the way, generated a hundred million dollars of sales “versus the cost benefit that I’d have got if I had done this cheaper and more efficiently maybe a hundred thousand dollars benefit.

Organizations in every case tend to focus on efficiency as functions and therefore sub-optimize the overall outcome that the process could deliver.

If you go and ask a company at the CEO or CFO level and say, “so how good are your processes ? " I’ll tell you the three answers they’ll give you:

1) " They are good or bad” - They won’t say how good or bad.

2) " I think I can improve my processes by x percent a year”

3) " I don’t know”

If you were to measure a number of these processes across large corporations and compare processes that are run really well in some companies vs. being run badly in other companies – the difference could be five to ten times better. For instance, there are companies that close their books in two days and those that take forty-five days. There are companies that pay bills to their suppliers in twenty-four hours and other companies that struggle to do that in ninety days. Some have a 5 % defect rate in goods shipped against orders while others have a 0.5 % defect rate. There has to be a way by which you can take the learning from the twenty-four-hour-payment company and transport it to the ninety-day-payment company and the value that you get there is not the efficiency value and the cost value, but the working capital of a billion dollars being released or the ability to capture 2 % extra discount on all your purchases from suppliers …. Effectiveness or outcomes!!

You can actually go to the granular level with granular metrics for any process in the world and define what "best in class" is. Some of us at Genpact have been on this journey to build this "Science of Process” for the last 15 years. We spent the first ten years collating data from running a number of these processes across companies and industries – we pulled all that together and said, so this particular process, how does this company run it versus that versus third versus fourth.

The interesting thing is sometimes the processes are pretty much the same or should be the same across completely unconnected industries. Why should a pharma company reconcile accounts or close their books dramatically differently than an automotive company? The reality is they actually do. So it’s not saying how I do this entire process better. It’s actually saying how do I do this little step better and the second step better, and the third step better, and for each of them there is a best in class. For each of them there is a connection to if I drive this improvement in this little process then here is the better outcome it produces!

How does one even begin to embark on this journey? It has to be in your DNA, a DNA of Lean, Six Sigma, and process granularity. Every process that we run for our clients, we measure at an extremely granular level. We collect all that data and create benchmarks. When we drive improvements, we know what drove that improvement and how much improvement was driven. We’ve done that for fifteen years. The missing link here was how to build it back into a framework. That’s the "Smart Enterprise Process” SEP framework that we started building about five years back.

We now have built it for twenty-six different processes across the world. And the fascinating thing is when we do a diagnosis of a company’s processes and go back telling them exactly which little step to improve which will result in outcome improvement – it shocks the wits out of them!! In fact, they are completely flabbergasted because they have always believed that they run their process really well. They’ve also believed that the improvements they typically can drive are five percent, ten percent versus five times, ten times which is what we’re able to deliver. Of course you have to measure outcome improvement Vs just efficiency.

That is the whole basis on which we have built “The Science of Process " and the more people learn it, which is learnable like any other science, the more people apply it. The more people use it and deploy it, the more value that they can generate for themselves, for their organization and for enterprises.

And by the way it’s not just about Technology!!

Culture doesn't eat strategy just for breakfast but for breakfast, lunch and dinner!

The phrase coined by Peter Drucker and later publicized by Ford’s Mark Fields had the right intention… but wasn’t quite on the mark. Strategy is important – and 80% of the books on management in any typical bookstore endorse that view. It’s important to know where you’re going, why you’re going there and how you’re going to get there. It’s important to know where your competitors are, where the market’s going and to figure out how you’re going to win in that space. However, the differentiation between companies is often not in the strategic path they took but in fact in the culture they drove in order to be successful with those strategic paths. And it can lend itself both ways – in using those strategic chosen paths to drive change because their culture allows them to be flexible and change … or not change at all because culturally they’re not wired to do so !! And that means that strategic chosen path never delivers results.

And therefore, I would say that while strategy is important, it’s even more important to have a culture that allows you to evaluate strategy openly. And call out a mistake when it’s a mistake and then change direction. If you are going down the wrong path, it’s okay if you have a culture that allows you to change direction. But if you have a culture that doesn’t allow you to do that, you’re doomed. Which is why I would argue that culture doesn’t just eat strategy for breakfast… it’s much bigger than that and therefore eats strategy for breakfast, lunch and dinner!!

If you ever want to pick the one thing that actually differentiates organizations, people, teams… it’s actually culture. Culture is about how you deal with situations, how you behave with each other, how you solve problems together, how you solve a client problem, how you approach opportunities, how you make trade-offs and how you take risks. Every one of those is deeply entrenched in a company’s culture.

Here’s the other thing about strategy versus culture. Strategy can be copied. The problem with copying strategy of course is that you lose the first-mover advantage. You kind of could become a ‘me too’. But it still can be copied. Culture cannot be copied. So if your differentiation is culture, first of all it’s a differentiation that’s built on your history, your legacy, who you are and how you got there. You know all of that and then you teach people all of that. And that proliferates that culture.

In our industry, for example, everyone uses Lean Six Sigma. Everyone talks about process, everyone talks about technology. So that’s not the differentiation. The differentiation is what’s the culture that you created that actually uses it. How does it permeate? How is it rewarded? How is it punished? Copying that is very difficult. It’s deep inside the DNA. It takes years to build and proliferate. And therefore, if your differentiation is built on culture, it’s a long-lasting differentiation. It’s a differentiation that’s not easy to copy and as long as it’s a culture that’s a winning culture, you will continue to win.

The Art & Science of Building a Career

Over the years I’ve come up with my own theory of how to build a career.

I think about building careers along three dimensions… let’s call them X , Y and Z.

The X dimension is the type of skills that different roles require. So finance skills vs. technology skills vs. marketing skills etc.

The Y dimension is the type of cultural environment in which those skills are used and exploited. It could be which geographic regional culture like American vs. European or it could be the type of business… like family-oriented entrepreneurial group vs. multinational environment or it could be hierarchical vs consensus driven culture etc etc

The Z dimension is the industry domain that that role belongs to …. Consumer financial services vs insurance vs healthcare vs retail etc

Every role can be defined along these three dimensions and as you go through your career you must do three or four things. One you need to make sure you really become an expert at one dimension at least – and do that early in your career. I’m a big believer that as you go through a career, you’ll always be known for one or two things that define you …. almost a safety net. So if everything else is lost, you can go back to your core.

The second rule is to change one dimension every time you move from one role to another. But don’t change two dimensions if you can avoid it and please don’t change three dimensions because that’s a disaster!!

The third is that over a period of three or four moves, change all dimensions. So if you look at role number one to role number four, you should have changed all three. And then you’re in a different culture, in a different industry, in a different domain!!

This way, you can almost chart your career as multiple potential options. So when I was working in highly change-oriented organizations like Unilever, Citibank, and then GE, every time I was asked to move jobs within the organization, it took me pretty much ten minutes to say yes or no because all I needed to do was fit it into this model. So I changed six roles in three years with Citibank. I changed four roles in six years with Pond’s and Unilever and I changed five roles in five years with GE and GE Capital in the early part of my career at GE …. I said yes in 100 % of those situations but that’s a different story I will tackle another day !!

But like most successful ‘mantras’, this one has to be a blend of art and science. The dimensions and rules are the science part of building a career… but you need equal parts of ‘art’ to build a successful career and this comes from investing in longevity, relationships and passion.

The generation that is getting into the workforce today is more impatient, more exposed, and they probably are more knowledgeable. They want everything in life… their gratification has to be instant!! When we hire people and look at resumes, we don’t care what a great job someone is doing today or yesterday, if the resume shows six jobs in ten years, they have zero chance of even being called for an interview. Zero chance! We just don’t call them because no amount of telling me why they did what they did is going to convince me that they’re going to last.

Equity gets created only when time is spent. Knowledge gets created only with time… when you combine intellect with experience. So one of the biggest things that I would tell people coming out of universities into the workforce and joining the workforce today is do not underestimate time, and do not underestimate relationships and both require equity. If someone were to ask me the one joy that I’ve got over twenty-five years of a career, I would say it’s seeing people who have worked with me, who have worked for me, and are now in probably bigger jobs than even they dreamt of . And I can look at them and say part of the reason they are who they are is because of the fact that, "we worked together. "

And the last thing I’d say is to be extremely passionate about what you do. Like Steve Jobs said do what you’re passionate about and be passionate about what you do, otherwise don’t do it. When the two match, there is no difference between work and play. I work twenty-four hours though I might not be in office… because I love what I do. I’m really passionate about what I do. And I think if people actually gravitate to doing things, whatever it is, that combine those two, then I think the chances of being hugely successful is so much better.

BPO is not a 4 letter word!

When one thinks of Business Process Outsourcing (or BPM as Genpact has called it for 5 + years now ) the tendency is to think of call centers, commoditized low value work, boring – repetitive tasks, night shifts and so on.


That picture isn’t too far from reality – but it’s a picture that was reality circa 1995 when this industry first started. Some of us who started the industry had the vision to take this picture and elevate it to a different level altogether, improving it dramatically to deliver real, measurable impact.

Cut to 15 years later – today this is a radically different industry that delivers services across a range of processes from the mundane to very complex and high value-add services. A pretty significant chunk – almost 40% – of what we do requires high skills, deep knowledge and sometimes at least 10+ years of experience to deliver high-end services like closing books of organizations, filing 10ks for US corporations, analyzing and detecting credit card & insurance fraud, warranty management and managing spares for aircrafts … there are hundreds of diverse examples.

The career paths of people in this industry tell this story …. of an upward swing in skills and certifications. People who started out making collection calls get CA or CPA certified during their tenure and switch career paths to start delivering high end financial work for global organizations. It’s fascinating to see how one individual can explore multiple career paths across industries, domains , functions and geographies… all within the same organization !!

One hears from the skeptics how there is little room for innovation in this industry. But let’s talk about what innovation really is – it’s not just designing the next Apple product, right? Most people limit innovation to product innovation. While that’s probably one of the more visible forms of innovation, it’s the not-so-visible innovation in processes or services or business models that truly lives up to its name. Ours is an extremely innovative industry when it comes to people management. Our talent retention and development practices are the most sophisticated compared to any industry anywhere in the world… for a simple reason… we are forced to do it! The war for talent is crazy… we hire 15,000 people in a year… we train 40,000 people… and we also lose 15,000 people !! In such a situation you are forced to innovate people practices that attract, retain and engage the best talent in the world. If you make a list of the best HR leaders in China or Philippines or India or South Africa or Latin America , I guarantee you they will come from this industry. The same goes for the best Lean Six Sigma or long-term client facing relationship builders, or finance people who understand finance across verticals and geographies – the diverse nature of our industry hones our talent to produce world-class leaders.

The trick however is that you have to last in this industry and build a career in order to really derive its true value.

Like, Love, Own

The Facebook ‘Like’ button modernized the way we endorse brands and now a Minneapolis-based 'social shopping' company is seeking to add icons like “want”, “love” “own” etc. to FB, taking PDA (public display of affection) of the marketing kind to a whole new level !!

Is this propagating laziness amongst consumers… who knows (and we'll probably hear enough debate on this in the coming weeks) but for the time being I wanted to share a comparatively more laborious exercise that we did at the company I work in … to tell the world what we 'like' about it... in words.

With FB clearly emerging as one of the more efficient ways to tap into the talent pool out there (we aggressively use it to recruit), we asked employees to post in less than 200 characters what they “like” about us on our official FB page...as a way to tell potential recruits what they can expect when they join us.

It worked quite well with interesting "value propositions" coming out from various employee groups. The big things that jumped out at us from the 200 posts with 1900 likes and several emails (for the social-media shy) we got were…Plenty of learning & growth opportunities; Great work culture with flexible timings, safe & secure environment, friendly & approachable leadership; Employee centric company with friendly policies, respect for and values employees, has faith in them; Unyielding integrity with a strong hold on values.

I couldn’t agree more!! But I do have a few of my own personal “likes” …Undying passion for everything we do, action-oriented-execution-driven-never-say-die attitude; risk-taking abilities, and finally our completely boundary-less approach to work. These are the things that drive and energize me every single day.

So in less than 48 hours we had pulsed our global organization of over 55,000 employees across 20 countries to be able to make meaningful conclusions with actions... that's the power of the world we live in today!

What makes an organization intelligent?

A question that I have constantly thought about is what makes individuals intelligent , humans intelligent …. “Understanding intelligence” is a quest that has driven humankind for centuries. But what about Organizational and Enterprise Intelligence ?

What makes an organization ‘intelligent’?

Organizations do two things; they run and they make decisions. It doesn’t matter what industry they’re in or what their size is… running and making decisions are fundamental to every enterprise.

The economic turbulence and resulting uncertainty in today’s environment has forced them to re-evaluate the way they do both.

They are now looking for ways to drive innovative solutions to capture opportunities when they occur, while not adding cost. They need to be smarter in today’s slow-growth phase in developed economies, while ensuring they capture the high-growth emerging markets for future success.
This combination of forces at play in this volatile environment is really forcing organizations to become smarter, find ways to grow revenue and capture new market share, while ensuring they don’t increase capacity themselves and instead build an ecosystem of partnerships.

So how does a high-performing organization differentiate itself? They build the ability to anticipate needs, have the dexterity to adapt to change and the spirit to innovate. They are effective in diverse markets and are alert to evolving stakeholder requirements. They are intelligent.

So what makes an organization intelligent? In working with a bunch of high-performing, successful organizations that have adapted themselves to today’s environment, here are 4 attributes that are common to all.

They are Globally Effective. They are able to address different markets and run equally well anywhere in the world. And they deliver better outcomes for themselves and for their customers !!

They are Connected. They pick up needs faster and use all the tools and technology available to build insights faster. They connect the dots across the enterprise and ecosystem faster and build cost effective relationships faster.

They are Innovative. They find novel ways to address both opportunity and uncertainty for competitive advantage using all the knowledge gathered through being connected.
And finally, they are Adaptive. They respond to change with agility. In fact, they thrive on change... they want change!! Because they know they outcompete with others when change is needed.

And therefore, organizations that are intelligent and are able to leverage their ecosystem of partners are the ones who dramatically improve the way they run and take smarter decisions !!

Birds of a feather... MUST NOT flock together!

Modeled on and in partnership with the famous TED conference, the INK conference brings a very eclectic group of people associated with varied walks of life like art & culture, non-profits, education etc and provides them with a terrific platform to tell their stories. Last month I had the opportunity to attend and present at the INK conference in Jaipur and meet with a fascinating bunch of people across three days… I was amazed at the richness of their stories… the amazing work they’ve done… and the ability they had to tell their stories in such an interesting manner.

One of the stories that stayed with me was of Aisha Chaudhary, a 15-year-old girl who was diagnosed with an incurable immune deficiency disorder at the age of six months, following which she underwent bone marrow transplant. In her incredibly simple and touching way, Aisha took us through her early days when she was wheelchair ridden and destined to inhale oxygen with the help of a tube clipped to her nose. Her story drew thunderous applause and a standing ovation as she told us about the 5 lessons she has learnt during this phase; 'Believe in miracles', 'Live in the moment', 'Opportunity in difficulties', 'Dare to dream' and 'Pets are the best medicines'!!

In 5 minutes one could learn much more from a brave young girl than what many would go through an entire lifetime and probably miss altogether! That really got me thinking how most of us tend to stick to and interact with people who are similar to us… do the same kind of work… and even think the same way.. limiting the potential of expanding one’s mind.

But when you walk into an event like this, not only are you faced with a bunch of issues that you probably never thought about but you also get to know people who have dealt with these issues in a very different and inspiring way. What excites and motivates them is very different from what motivates most of us. So it really makes you stop and think and walk out side your comfort zone. It makes you forget your regular problems and the standard approach one tends to take to deal with those problems.

What’s interesting is that one doesn’t attend such events with the objective of doing a business deal… but rather to pick up experiences and ways of thinking that one can bring into one’s own situations. That’s the real benefit.

During the conference, I also got the opportunity to talk about the birth, growth and evolution of Gurgaon and the human stories behind its growth that has changed millions of lives. It's a story of hope for the future for a country like India, provided we can replicate all the good things that have happened and find solutions for the problems that still exist. The only way it can happen is if the partnership between citizens, their employers and the local government further strengthens and takes it forward.

But being an optimist, I am convinced it will happen - we will find incredible ways to drive inclusive growth!!

Of Horses, Cats and...Tiger !!

I recently did a 3 part interview with Phil Fersht from Horses for Sources. Came out quite well...read and react!

A big cat for a big job: meet Tiger (Part I)

One company has done more than most (some argue any) to change the very face of Business Process Outsourcing over the last few years.

Its origins can be found in a world-class finance and accounting captive that commercialized its operations with an army of enthusiastic process geeks, schooled in the arts of LEAN and Six Sigma… and at competitive prices. “Isn’t that the GE company” asked one CFO of me, when I ran him through a potential list of F&A BPO providers candidates, “Get them in, I want to hear what they have to say”.

Indeed, the rise to prominence of Genpact has been nothing short of remarkable, as the firm has reemerged in 2011 hungrier and more acquisitive than ever. Having survived a tough recession for the BPO industry, successfully fending off larger competitors baying for its blood, Genpact has recently taken a new direction: appointing NV “Tiger” Tyagarajan to take the helm from the irrepressible Pramod Bhasin, who preached process so poetically with us last year.

Anyone close to the business has always talked about the “Pramod-Tiger” double-act for several years, with Tiger initially being the US face of the firm, and Pramod coordinating activities from India. More recently, Tiger returned to his native India, not only to reconnect with his first love, cricket, but also to take on the role of COO and ready himself to succeed Pramod, who had inexhaustibly led this firm, since its 1997 inception, to surpass $1 billion in revenue.
Tiger is now settling back into New York – a short train ride from his son’s university in Georgetown, Washington D.C., where he is now in the process of adding his personal leadership style to the Genpact machine. So the $2 billion questions today are: what will Tiger do differently? How will Genpact fare with its leadership team Stateside? How will Genpact continue to evolve its business to move beyond its mainstay finance and accounting service line?

Well, you needn’t wait any longer, as Tiger recently spent some time bringing us up to speed:

Phil Fersht (HfS Research): Good morning Tiger. Before we delve into the current business issues, let’s talk a little bit about your earlier career and about you as an individual.
NV “Tiger” Tyagarajan (Genpact): I did my undergrad in mechanical engineering at the Indian Institute of Technology in Bombay. And while I loved the problem-solving, logic-driven approach that engineering teaches you – and I use that in many situations today – I realized I didn’t want to spend my time with machines. I want to spend my time with people.
So I did my masters at the Indian Institute of Management in India, and specialized in marketing and finance. And I loved those two years. I thought I had found my sweet spot, being able to use logic and numbers and finance while at the same time, driving change through groups of people to get to a decision or a certain point.
My first job was selling, believe it or not, cosmetics for the Indian subsidiary of U.S.-based Chesebrough-Ponds. By my seventh year with the company – which by then had been acquired by Unilever – I had sales management responsibility for the country’s largest region, which accounted for 40 percent of the company’s sales.
That was great management training, and gave me the chance to learn the ropes in managing sales teams, and in understanding consumer and business behavior. But I was getting a little tired of a single product market environment, so I decided to switch to financial services and joined Citibank’s then new retail mortgage lending business. I held six different jobs in three years at Citi. And without going into all the ugly details, I was quickly termed the “cleanup guy”, the person designated to clean up a problem, and one of the ways I did that was by attracting and building up a team of A players. But my fundamental view was that if you really want to succeed, you’ve got to surround yourself with the A players, and I’ve carried that view forward in my career.
By that time, 1994, GE Capital announced it was going to set up a financial services company in India. I read Jack Welch’s two books and fell in love with GE. I knew it was a place where I could spend my entire career, going from credit cards to aircraft engines to healthcare to NBC, without ever leaving the company. I could also at some point in time actually see myself leveraging my engineering background and feeling good about it. So I joined GE Capital – and was probably the third or fourth employee in India – as risk head of its consumer lending business.
I moved to the U.S. in 2002 as the Global Head of Operations and Six Sigma for GE’s commercial lending businesses. Then I joined Gecis, which is now Genpact, and here I am.

Phil: Tiger, we all know what an amazing job Pramod did to get Genpact to where it is today. Can we expect anything radically different under your leadership?
Tiger: With the dynamics and pace of change in our industry, all providers have to be nimble and able to change rapidly, and Genpact did that under Pramod. There will continue to be dramatic changes, but that’s par for the course for us.
A few specific changes I am focused on are:
- Significantly growing our investments in domain-led sales and account management folks who have the knowledge and expertise to bring a high degree of sector-specific thought leadership into conversations with clients in vertical industries including banking, capital markets, CPG, pharma, retail, manufacturing, insurance and healthcare
- Shifting the center of gravity of the company’s leadership so that 50 percent are located on the ground in client markets. This of course includes my running Genpact from NY

I think the next 10 years will be about the science of processes and the insights gleaned from data analytics. So we’ll build on our unique, 10+ years of deep analytical capabilities across a broad range of industries to help our clients make increasingly smarter decisions

Phil: And is your leadership style very different, or very similar, to Pramod’s?
Tiger: As we both grew up in GE, there are aspects of our leadership styles that are very similar…bias for speed and action, the passion we openly wear on our sleeves, a deep disdain for bureaucracy, etc. But there are also differences in our styles. I get my energy, ideas and passion from conversations with clients, people in the industry, my team and our broad employee base, so I spend a lot of my time on the road in the markets with them. That is core to my style, probably because of all the time I spent in sales – 22 years! I also believe that this is the best way to drive innovation. And with my years spent as a risk leader, I’m a huge believer in the 80-20 rule…in this case, pick a few things you say “yes” to, and say “no” to a whole lot of things, and then drive the “yeses” hard, and with consistency and investments.

Click here to read the full three part interview trilogy, where we talk more about Tiger’s plans for Genpact and his vision for the future of technology and BPO…

Not just nurturing...rooting for gender diversity!!

A couple of weeks back a young and upcoming leader at the mid management level in my organization did something that most people would probably hesitate doing – she wrote to the CEO, myself and a group of senior leaders in the company about a personal experience very close to her heart.

Her note referred to International Women’s Day and started off talking about all the media hype around the event, which tends to focus on the position of women today, workplace issues etc. …. with an underlying tone of the need for being treated equal. Probably like most of the others marked on the mail, I assumed this was either a congratulatory note to to applaud our gender diversity efforts or she was suggesting new ways to beef it up further.

But the note wasn’t about that. It was about sharing a very personal experience she had going back eight years and what it meant for her!! She referred to the time she was called for an interview with Genpact and how she was convinced she'd be rejected at the first level – why? Because of her 8 month baby bump! To her amazement her experience was very different… and I quote: “To my surprise, my impending motherhood did not deter the hiring team from taking me on… they were focused on the capability that I would bring to the organization! I have come to realize that in our organization, opportunities are assigned always based on capability." She then went on to describe how our flexible culture and meritocracy driven environment has played a significant role in her staying on with the company and how many people probably take this culture for granted.

Her note, while flattering to the culture we have fostered and built, also made a very important point – the fact that many women assume that pregnancy and motherhood comes in the way of building a career -- ironic since she was actually starting the journey of a long fruitful career during her pregnancy.

The question in my mind has always been how do you create and sustain an environment where you can tap the best talent available, drive a strong performance culture, allow people to dream and attain their full potential over time and yet be able to allow them to go through life’s many milestones. We're obviously doing something that's working that must be replicated sustained and encouraged everywhere in the world.

All of us in our leadership roles in organizations strive for business performance that’s admired by our stakeholders, customers, investors, employees etc. We drive hard to find a motivated workforce... but in the end it’s the fact that we can actually create an environment that makes one write what she wrote, allow her to fulfill her ambition while going through other pulls and pressures of life...is what makes everything else pale into insignificance in comparison. WWish we could all create more environments across the world like this!!!