Murray Dalziel, group managing director of the global consulting firm, The Hay Group, appears all at ease as he poses for photographs under the blazing Mumbai sun. The co-author of the well-acclaimed book, Competency-Based Human Resource Management, was in India to discuss globalisation challenges with Indian companies. Dalziel, spoke to Govindkrishna Seshan on the growing interest in leadership issues around the world and the opportunity for Indian leaders. Excerpts:
Are business leaders born or are they made?
I have a very clear view on this. Some people have more leadership characteristics than others. But the characteristics that really make a difference can be developed. So I am inclined to say that leadership can be developed. Even if I am born with all the natural attributes, certain characteristics are best when developed.
You have to look at leadership at different levels. Obviously, individual development has to be undertaken, but leaders must know to work in teams. In the best companies, leaders also focus on coaching teams.
A lot of companies are spending time and money at an organisational level to manage, assess and pick up talent. These are normally initiated by the chief executive officer.
Many companies accept that succession planning has to be an ongoing process. But does that happen?
There has been a big change in the last 20 years, particularly in Europe and the US. I think that senior managers are much more intensely involved in leadership development.
For instance, just look at the frequency of articles on leadership in Harvard Business Review. We found that there were very few articles on leadership in the 1970s, a little more in the 1980s. It doubles in the 1990s and clearly peaks from 2000 onwards. It's clear that leadership is what the senior management wants to read.
What is the changing role of leadership in the knowledge economy?
Knowledge workers probably need more guidance. As organisations become flatter, you need the framework and the vision. In those firms that are very dependent on knowledge workers, the levels are a lot more flatter. Hence, it's a lot more important to take people along with you and help them understand where they and the company are heading.
Most Indian leaders look westwards for leadership models. Is it the same globally, or does leadership need to be localised?
I think local conditions are very important and you need to understand them very well. Culture has a strategic importance. And Indian CEOs are different from their counterparts in the US or Europe.
They are much more entrepreneurial than CEOs from the West. They are faster and are extremely visionary, with a good business acumen. The bad news for Indian CEOs is they are less adept at bringing people along with them and they don't have the ability to reach out to people in the lower rungs of an organisation and getting their commitment or understanding them.
As things get more complex in a globalised environment, there is a lot more complexity with professional boards and professional leaders. When you have multiple cultures, then getting people together becomes much more important. That's the challenge for Indian CEOs.
Having said that, India has a great opportunity. It can become the supplier of leaders to the world, if you consider the demographics of India. There is a shortage of leaders. There is an economic crisis because of the demographics.
If you look at the US and Japan, they are running out of leaders. In the US, 75 million people will retire within the next 10 years. And 5.5 million of these are in the leadership or managerial ranks. From a demographic point India is at an advantage.
The government and the private sector must ensure that leadership receives due importance and make investments that enable India to rise to the opportunity.
In a high attrition scenario, how can companies pick leaders and ensure that they keep the flock together? Many companies are creating parallel leadership to retain employees. Is that wise?
I think it depends on how you develop your first-level supervisors. That's because first-level supervisors are the make or break points of attrition. Selecting the right people is crucial. People mostly leave due to bad bosses. Creating parallel leadership positions is just stupid. I think that would be a very bad practice.
Do you feel that MNCs can become truly multinational only if they have a global representation on their board?
For nearly 10 years now, every large multinational company has been trying to have global representation on their board. Novartis is a Swiss company. On its board there are Swiss, German and US nationals. Even the board of GE is a similar case. Boards that keep a policy of having only their nationals on the board are not truly global.
I don't like localisation as a policy. Not because I think that dominant leaders in a global company should be expatriates, but a truly global company has global leaders. In the case of Novartis, the head of its operations in Greece is Swiss and its UK head is of Indian origin. You have to move beyond thinking of just the local talent. In an high attrition scenario, you keep losing your best.
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