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The Eternal Debate - Traditional Management Vs Professional Management

Wednesday, March 28, 2018

By Dr. Neha Jagtiani, Vice Principal, R.D. & S.H. National College, Bandra West, Mumbai 400050

From time immemorable , there has been a debate as to whether a person , man or woman is rich by birth or by his / her deeds. Our ancient scriptures discussed and analyzed this tussle. If you read our great Indian epic ‘Mahabharat’ , it provides a classic example. Guru Droacharya wanted Arjun to be the best archer in the world.

Our scriptures have always debated whether a person is rich by birth or by his / her deeds or ‘Karma’. One cannot choose which family we are born to rich / poor, higher caste / lower caste, Hindu / Muslim / Christian / Parsi / Jew. What is in our hands is what we make of ourselves.

The mindset of people does not change. Our society expects the politician’s son / daughter to be a politician, corporate’s son /daughter to take over from their father, so on. A person born in an accomplished family automatically inherits status, power, and position. It takes an individual many years, almost a lifetime to prove that his worth. He / she has to struggle very hard to prove that it is merit, talent, capability and hard work that gives an individual his place at the top of the rung of the ladder. It takes an individual extreme grit and determination to change the mindset of people that it is talent, merit and hard work which takes a person to earn his place not just being born into the field or merely inheriting it.

2) To illustrate this struggle, let us examine the case study of Lee Iacocca vs. General Motors. The famous management wizard Lee Iacocca had a very humble beginning. He was the youngest child amongst eight siblings. He was born to very poor Jewish parents who could not afford to educate him. He had formal education only till he was 13, after which he had to drop out. He made his living by doing odd jobs. By the time he was 18, he was working with as an assistant with a petrol pump. An executive at General Motors, America’s largest automobile company, got friendly with him and offered him a job as a junior car salesman. His knowledge of cars was so accurate that within three months of his joining he was able to record the maximum sales in his division. Within six months, he was made the head of the sales division. He had so many new ideas and innovative methods to sell, that within a span of two years, the sales division that he was head of recorded the highest sales in the entire country. From sales head, he was made divisional head, progressed to area head and went on to become country head. Henry Ford, the third recognized his talent and made him the CEO of General Motors. He took General Motors to great heights and made it America’s largest selling automobile.

Henry Ford, the third was due to retire and made his son Henry Ford, the fourth, his successor. Here was this young lad, who inherited the position as Chairman of America’s largest automobile company and thought no end of himself. Lee Iacocca could not get along with him from day one. They fought on every issue, so much so that they started avoiding each other. Lee Iacooca had joined General Motors at the junior most level and knew Ford motors like the back of his hand. At one issue they locked horns.

The day he joined, he called for a meeting. For the first time in American corporate history, he called the workers for a board meeting. America was facing a recession at that time. The top brass would typically ask the workers for a wage cut while themselves maintaining their lifestyle and plush offices.

He told them “I never expect from anyone else what I don’t expect from myself. For being the CEO of the company, I will take home a salary of one dollar. In return, I am only asking for a 33 % wage cut. I will work in this company for 14 hours a day. I return, I expect you to put in 12 hours a day “.

He toiled day and night. Within, three months, Chrysler launched its new car. With his marketing wizardry, he offered irresistible offers to the public. Within 6 months, they managed to sell more than 10000 cars. Within three years, they wrote off 18 million losses and showed the first dollar of profit.

The day they showed the first dollar of profit, Lee Iacocca went home and slept. He felt he had a point to prove which he proved. Chrysler went on to become America’s No.2 automobile Company, second only to General Motors. General Motors was a 100 year old established company whereas Chrysler had been facing bankruptcy and closure till about three years ago.

Similar cases have taken place all over the world and continue to take place. It will take a change in mindset for an individual to prove that it is an individual’s capability and merit and not merely by birth that one can achieve status, position, respect and recognition in society.

Dr. Neha Jagtiani is a double gold – medalist from Mumbai University having secured the highest aggregate marks at Level. She has cleared the All- India NET Examination, being among the only two from Mumbai and among seven from all over India. She has an Honors Degree ‘Masters in Subject Communication. She completed her P.HD in January 2014 for which University Grants Commission, New Delhi had given her a study leave of two years.  She was awarded the PH.D degree from the Governor, Union Minister for Railways   and the Education Minister.

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