Succession planning not a strong point for most companies: R. Gopalakrishnan2 min read . Updated: 27 Jan 2017, 02:03 AM IST
R Gopalakrishnan talks about why firms need to do a lot more to adapt to the fast-changing external environment, and how innovation has become imperative over the years
Mumbai: Succession planning is not a strong point for most firms, whether Indian or foreign, said R. Gopalakrishnan, executive-in-residence, SP Jain Institute of Management and Research, and a former Tata Sons Ltd director.
In an interview, he also talked about why firms need to do a lot more to adapt to the fast-changing external environment, and how innovation has become imperative over the years. Edited excerpts:
Are companies resistant to change and not willing to let go of the past?
I think there is much more that has to be done. You see, it is very difficult to know what in the past to give up. You can’t give up the past completely and being discriminating of what about the past you will give up and what you will keep is not easy. There is a period of transition going on not only in India but also globally.
What do you mean by period of transition?
When I began my career, nobody thought of India as being an innovative country. It has now moved to saying some interesting things are coming from India. What I am hoping is that in 25 years, people will say that this can only come from India. So, it’s a period of transition.
How has decision-making changed over the years as innovation became important for organisations to survive?
I have been around for 50 years. If I go back in time to 30-40 years ago, innovation was a nice thing to do, a desirable thing to do. People always aimed and aspired for innovation. Now it has become an imperative or an essential. That’s a big change.
For example, human beings have always wanted to be healthy. But today young people want to be healthy and that reflects in the gym culture. Or in the feel-good spa culture, which was a luxury. Innovation has moved from a nice thing to do to an essential thing to do.
Another thing that has changed over the years is the pace. Earlier, the pace at which we innovated was like riding a cycle in a nice wooded countryside. Now it’s like a frantic race you have to win. It’s very different when you stand outside and watch it. Both these reflect change in imperatives.
How do you rate Indian firm s on succession planning?
Generally speaking, succession planning is not a strong suit for most firms, Indian or foreign. It’s not an easy subject. It can sometimes go wrong and sometimes it will come right. Nobody gets it wrong all the time. Nobody gets it right all the time whether it is Tata or Hindustan Unilever or whoever.
So if you take a company like Nestlé , they had a lot of good candidates but they decided to get an outside person to head the organization. So they have got the chief executive from a pharmaceutical company, which is very unusual for Nestlé. If you go back 10 years to Unilever, they went out and got someone from Procter and Gamble and then later again from Nestlé.
So I think each firm, even if it has a good process, defines a new imperative and then tries and follows that imperative.