Nobel Peace laureate Dr. Muhammad Yunus (Grameen Bank) delivered a beautiful bold talk this morning to the International Humanistic Management Association. Here is the link to the video, https://youtu.be/WFwK8bzIKW0 … and a summary of my notes.
The global economic machine is broken. Coronavirus has done us a favor. We should create a bank for rural entrepreneurs. Call it emerging, or potential sector instead of an informal sector. Young people should not have to go to cities and face harassment. Rural economy should not be a footnote to the urban economy. These are social businesses. More than 50% of people work in the informal sector. Urban economy consumes rural labor and makes money for themselves. Rural economy should not become a footnote to urban economy. Distance has become unimportant. The business idea has become important. We don’t want to go back to the old economy. We want to go forward and design a new world.
This is a crisis, but also a great opportunity to create global social businesses for coronavirus solutions. Globalization has deepened. e.g. the same virus impacts everyone. The narrow view is about how to make money. There are only a few companies who own a chunk of medicine business. The medicine solution should be for the benefit of the people, not to make a profit.
Rural areas don’t need to wait for urban buyers. We will process our produce here. We are not at the mercy of the urban buyers. We will deal on equal terms. Governments have not done much for the informal sector. Bangladesh has Ministry of Labor at all levels of the government. We will create our own chambers of commerce. Rural social businesses have full rights.
Academics have had a big role in creating this misery. We have contaminated the young minds with wrong ideas about a selfish world. There are social businesses that are not motivated by private interest but by common interest. We have to take care of the future of the world and our children and grandchildren. Social businesses can be in rural areas as well as urban areas.
How to get the economic machine to come out of coma, and put it to good use? We are pouring trillions of dollars into the machine, so the money is there. We should not pour into the fossil fuel industry. We should move into a new world. Scaling up is not a problem because the money is there. Invest in the companies that are solving the problem. Anyone who can help lead to this new world will win Nobel Prizes. Business education should not be only to make money for others. That is the conventional MBA for a soldier (general, gladiators) to make money for corporations. The alternative is the social MBA. Its purpose is to solve social problems of the world in the fastest way. How to inspire people to do that. This is a good time to start a social MBA program.
I finished listening to Mr. Rajat Gupta’s [photo credit: Wikipedia] memoir ‘Mind without Fear’ in just two sessions. It is a compelling story of the Mind and the Times of an exceptionally accomplished person. He had the good luck to be the right person in the right place to become first non (white) American managing director of McKinsey & Co, when the firm was ripe to go global. He was the wrong guy at the wrong time when he entered the financial markets with the wrong guy, and got the wrong overzealous prosecutor thus getting jailed for two years. He draws inspiration from his father who was an Indian Civil Services officer during the British rule but resigned Mahatma Gandhi’s call for freedom and was jailed and beaten mercilessly with permanent damage. He also draws inspiration from the Nobel Laureate Rabindranath Tagore, whose beautiful poetry threads the book and gives it the title of Mind without Fear. He also draws solace from his strong family and the many friends who stood with him and believed his story. He however deeply regrets not taking the stand and testifying in his own trial, as he received overwhelming advice from his lawyers and his loving family that allowing the prosecutor to question him directly will be too risky. At the end of it all, he comes out of the ordeal with his head held high, without much bitterness for those who deserted him including the McKinsey firm who dismissed him summarily and took his name off their alumni list.
I believe Rajat Gupta’s story, as I have done over the years. He is a fellow IIT-Delhi alumnus ten years my senior. I met him at Pan-IIT meets in 2007 and 2009. He looked handsome and seemed very honest and a good listener. I do remember some of the stories of the next few years as the attorney Preet Bharara with political ambitions set his sights on a fellow successful Indian. There was a story in the Indian press about Preet Bharara and Dr Sanjay Gupta, whose moms knew each other from India, about whose son is doing better in the US. I recall a feeling of a certain revulsion at that approach to achieving success by beating down an iconic fellow Indian. Some of my well-meaning friends however felt at that time that greed and power had gotten the better of Rajat Gupta.
Rajat Gupta has done much good work including seting up Indian School of Business and starting the Public Health Foundation of India. He also started the Global Fund against three major diseases. These inspirational stories are laid out in great detail in the book. That alone makes the book worthy of attention. What the book does not tell is that none other than Narayana Murthy, the founder of Infosys, compared Rajat Gupta with the first prime minister of India Jawaharlal Nehru for having started two world class organizations in India. I also salute Rajat Gupta for his great work. May God grant him strength to continue his good work. He wants to work on the American penal system which he observed from the inside and found deeply lacking. He should also write a commentary on the Bhagavad Gita, the book that he read during his incarceration and which helped him come out stronger, with malice towards none and with his head held high!
I did data analytics for a long-term project on family businesses, while at Case Western Reserve University a little over 2 decades ago. Using survey data from hundreds of respondents across dozens of companies over several years, we tried to analyze predictors of success at family firms. The astonishing finding was that the biggest finding was not about usual factors like ‘Succession Planning’ and ‘Clear Strategy’ etc. The biggest amazement was that across almost all dependent variables, the age of the respondent showed the greatest impact. We found what I used to call a bucket curve. For respondents under the age of 30 and below, their perceptions of their company was good. Similarly, for respondents of age 50 and over, their perceptions of their company was good. In the middle age, the respondents’ perceptions were not too good, across all variables. No other independent variables, like gender and education level and years of experience and even whether the respondent-employee was also a member of the owning family, made any difference. The AGE variable ran away with the whole variance, and thus the whole story.
We went to the retired dean of the school of business to express our excitement, amazement as well as trepidation at such a result. This old wise man looked at the results, asked some questions, and said that it all makes sense. The younger employees are glad for what the company has given them. The older people are looking back with pride at what they have achieved. It is the folks in the middle who are nervous and frustrated as they have half their career behind them and want/expect the company to give them more opportunities to do better.
The paper was sent for publication on the strength of this finding. It got published at Family Business Review, the top journal in the field, in 1997. Twelve years later I accidentally discovered that this paper had been included in the authoritative Handbook of Family Business all these years (there are less than 30 papers in that handbook). This paper was significant for just this insight, that age changes perceptions like nothing else. At our age, we are mostly happy as we have accomplished a lot!