Jamshed J. Irani's stewardship of Tata Steel is the stuff legend is made of. To state his complex feats in simple terms, Dr Irani led the beleaguered behemoth from darkness into light. Here, in an interview with Christabelle Noronha, he elucidates his idea of leadership and the characteristics that those aspiring for that elusive quality need to cultivate.
Can one train to be a leader or is it an inborn trait?
I don't think leadership is an inborn trait; it's not a genes thing. Rather, the environment plays a vital role. Professionals should not have everything heaped on their plate right from the early days. They should have opportunities to think and plan and then develop the acumen to use these opportunities to their advantage.
I don't believe there's any such thing as 'luck' in business; it all depends on the plan one has. But it is not just enough to have a plan. The environment should be such that people are encouraged and prepared to grab the chances that come their way.
But you must understand that everyone cannot be a leader in every sphere. You have corporate leaders, military leaders, political leaders and so on. Indira Gandhi was a good example of a political leader. She grew up in an environment of politics and when an opportunity came her way, she grabbed it. All her life's training was available to her. So, to be a leader you need two attributes: the environment and training. Equally important is recognition of the fact that this is an opportunity and one has to grab it.
Can organisations create an environment where leaders are nurtured?
Of course they can. With due modesty, Tata Steel is an ideal example. The company has produced and provided leaders to several industries within the Tata Group as well as outside it. I can name at least 25 ex-Tata Steel people who have gone on to become chief executive officers elsewhere. Our chairman [Ratan Tata] was with Tata Steel and some managing directors of government steel plants were once with Tata Steel. The company did not suffer because of their leaving; it simply developed more leaders.
The leadership development environment depends on the person at the top, since it is he or she who can provide the right opportunities and challenges. When people feel insecure they tend to keep everything to themselves. Then there is no delegation and all authority is centralised. That's when there is a problem. If there is free-flowing delegation, the environment becomes conducive to developing leaders.
Do you believe that good leaders are those who vibe well with their followers?
One cannot be a good leader if one doesn't have followers. A leader on his or her own can do nothing; there always has to be two-way communication. My idea of leadership centres on what a chief executive officer ought to do to create endless opportunities for two-way communication. If all communication is unidirectional then you stop people from thinking on their own; you stymie them, you kill initiative. Family enterprises often fall prey to this sort of problem (they wait for the patriarch to make a decision). We need to encourage people to think independently. There should be a system whereby even people at lower levels in an organisation can take decisions.
The mark of good leadership is how well the organisation or institution survives when the leader withdraws. When an organisation or institution is totally dependent on one person then that is not good leadership. It may be good for the ego, but bad for the organisation.
Good leaders must make sure that they will not be missed. In any process of change management, the leader must lead from the front and take ownership of the process. This responsibility cannot be delegated. Leaders must create a sense of urgency, not panic; they must embrace change even when it doesn't seem necessary.
Is leadership only about people at the top?
No. In the recent tsunami, fishermen found themselves in a situation where there was no leadership. So they took up the challenge and went out of their way to rescue people. Everyone can, in their own sphere, be a leader. Leadership operates at all levels and it emerges in different situations.
I'll give you an example. In 1992-93 the mafia was rampant in Jamshedpur. The police were not doing anything though they had a force of 3,000; there was extortion, killing and looting. I kept telling Laloo Prasad Yadav [then chief minister of Bihar], "Please give us a good police administrator." At a gathering of over 5,000 people, I finally told him that we wanted nothing from him except law and order. He was suitably embarrassed and said that he would send his best police officer. That officer was Ajoy Kumar. He came and within three weeks there was a difference. In three months he had cleaned up Jamshedpur; and that's a benefit we still enjoy. I asked the same police people what prompted the change and they said Ajoy Kumar gave them self-respect. Leaders cannot put themselves in ivory towers; they have to have mass support.
What about issues such as emotional intelligence?
Emotional intelligence is becoming increasingly important today because people are getting more knowledgeable and they want a leader who can empathise with them. Ajoy was a good example. He would go out and help people down the line. There must be an emotional bond with people.
Earlier, it was also important that leaders have charisma, but these days charisma alone is not enough. Laloo is charismatic; Manmohan Singh and P Chidambaram are less so. But the latter are leaders because of their appreciation of the situation and their ability to do what is required. To go back to the importance of being ready with a plan and striking when the opportunity arises, Manmohan Singh was ready with an economic plan and, when the opportunity to liberalise came along, he made the most of it.
So what are the chief attributes a modern leader should have?
They must be able to empathise and communicate with their followers. You have to be on the ball or you will be found out. Another critical attribute is credibility. Today, because geographical limitations are blurred thanks to the advances in telecommunications, the role of a leader has changed, while becoming much more important.
S. Ramadorai [the chief executive officer of Tata Consultancy Services] is a different leader from me. I depend on eye-to-eye contact but the kind of technology he has to deal with throws up challenges of a different nature.
The JJI credo on leadership
Develop a personal vision
Tell the truth about current reality
Do the tough things no one else wants to do
Restructure the top team, if necessary
Build a powerful guiding coalition (management and the board)
Guide the creation of a shared vision
Take responsibility for being a change agent
Create endless opportunities for two-way communication
Craft opportunities for innovation among the rank and file
Realign human resource systems; overcome obstacles
Model the desired managerial behaviour
Above all, maintain credibility
Preserve the core values of the Tatas (and my own)