Wednesday 13 June 2012

Change, whose job is it? Part 1

Ever since I joined Industry 21 years ago, I was often taught by my mentors & coaches, there is nothing constant but change. Be adaptable, flexible, willing to learn etc., etc. if you wish to succeed in the corporate world. As a young professional I obediently listened to them and remembered the gospel of my seniors. You can see, I still remember it.
A few years back I used to work for a respected FMCG company with revenue of $250 mn. We had a new CEO join us from Hindustan Unilever Limited (which was $ 2b in revenue then), which had and continues to have a reputation of developing great leaders.  The FMCG company I worked for had a deep rooted work ethic, was in existence for more than 50 years, its culture was laid back, its market share was not challenged for many years, was steadily growing and was very profitable. The new CEO had a mandate from his global leadership to shake up the work ethic, drive aggressive growth and improve market share.
The CEO in his initial days went across the country, met various executives & leaders, heard their views about issues in the business and got a grasp of what were the challenges in the company. After his India tours, he called the Management Committee (MC), the highest leadership body in India for a meeting to discuss what he learnt. Interestingly the MC echoed the same issues/concerns that he had heard from the field. The CEO got excited and said to himself “I guess I understand what I need to change here”.  Next 2 years were years of rapid change, the CEO made big bold decisions, he led from the front, the company refurbished its brands, launched new products/brands, re-launched its old boring brands with new packaging, formulations etc., many heads rolled in various parts of the country, change was finally happening…..
2 years of pain-staking effort, the CEO appeared to be on a tread-mill and almost omnipresent in very meeting / forum.  All these efforts, more than 50% of the people in the company were < 2 years old, salaries grew, people were paid much better,  some product launches succeed, a few failed, company grew marginally in market share, revenue & profits but the employee morale dropped significantly. End result – the COE was fired !!
A couple of years later, I joined HUL and happened to meet this ex-CEO in an external event. We got chatting. He was still reeling under the scars of his past. We were reflecting on what went wrong – people needed the change, his MC needed the change, the global leadership needed the change, the desired change was brought in – why did it not work, why did employee morale drop, why did sales/margin not grow as expected etc.? It was a million dollar question in his mind.
I want to pause my story here and pose this question to the readers - What do you think appears to have gone wrong?

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