Where does the buck stop?

A few months after I had joined a marketing company, the Export Director informed me that the company had decided to participate in a month-long trade show in a foreign country. It was proposed that our stall, in which we would display 2 machines, would be manned by a Senior Service Engineer and me. The Senior Service Engineer would look after the installation and operation of the displayed machines, while I would handle all business enquiries.

When I pointed out that I had absolutely no exposure to International Trade, he assured me that our company’s Agent in that country, who was extremely well-versed in International Trade, would guide me in all commercial/legal matters.

The trade show went off very well. Many visitors showed interest in our machines. One customer decided to buy both the displayed machines. Our Agent prepared the contract documents, which were signed on the last day of the trade show by the customer and by me on behalf of my company. The documents contained some clauses that I thought should not be there. When I asked our Agent about these clauses, he confirmed that these were standard clauses in any such contract. Considering the Export Director’s assurance, I signed the documents. The machines were handed over to the customer.

A few days after we returned to India, it turned out that our company could not claim the payment for the two machines because the contract documents were not suitable for machines that had been displayed in a trade show. (The contract documents would have been perfect if the machines had been shipped directly to the customer.) Our Managing Director was totally upset, but he said our first priority should be to recover the payment, adding ominously that a ‘post-mortem’ on the matter could be carried out after we recovered the payment.

We engaged the services of an Export Consultant, who managed to resolve the matter. Our company received the payment three months later. As expected, our MD summoned the Export Director and me to his room the moment he was informed that the payment had been received.

As soon as we were seated, our MD glared at me and asked, “How could you have signed a contract that contained such glaringly wrong clauses?” Before I could say anything, the Export Director said, “Sir, it was not his mistake. He only followed my instructions. Before taking up this assignment, he had reminded me that he had absolutely no exposure to International Trade. I had instructed him to follow our Agent’s guidance in all commercial/legal matters. When I told you this, you had expressed your reservations, but I had assured you that I have complete confidence in our Agent. It is my mistake.”

Our MD was absorbed in silent thought for about 30 seconds, during which I fervently hoped he wouldn’t take any drastic action against the Export Director. I was stunned when he looked at the Export Director and said, “It’s not your mistake. I am to blame. It was wrong on my part to have accepted your assurance.” He turned to me and said, “I am sorry that we sent you on this assignment without training you properly.”

It would have been very easy for the Export Director to blame me for the mishap, but he chose to accept responsibility.

It would have been even easier for our MD to blame the Export Director and/or me for the mishap, but he chose to accept responsibility.

Both the Export Director and our MD had displayed the essential leadership quality of readily accepting the ultimate responsibility for a decision that has gone wrong. In other words, “The buck stops here!”

How many leaders (in business, politics or any other activity) readily accept the ultimate responsibility for decisions that have gone wrong?

How many leaders ‘pass the buck’?

What do we do when our decisions go wrong? Do we readily accept responsibility, or do we ‘pass the buck’?

Train journey with Narendra Modi

A Facebook friend shared “A train journey and two names to remember“, which had appeared in The Hindu on June 1, 2014.

The writer, Ms. Leena Sarma, General Manager of the Centre for Railway Information System, Indian Railways, New Delhi, has written about a train journey in 1990 from Delhi to Ahmedabad, in which she and another female colleague were co-passengers with Shankersinh Vaghela and Narendra Modi, both BJP members at that time.

I strongly suggest you read the entire article, but for those who are short of time, here’s the summary:
Ms. Sarma and her female colleague, then Indian Railway (Traffic) Service probationers, had wait-listed First Class tickets to travel from Delhi to Ahmedabad. The train was heavily booked. The TTE (Travel Ticket Examiner) asked them to sit in a particular coupe, and assured them that he would try to get their tickets confirmed. The two persons who had confirmed tickets for that coupe were both politicians, as could be discerned from their white khadi attire. The TTE assured the two women that, “They’re decent people, regular travellers on this route, nothing to worry.” The politicians readily made space for their co-passengers by almost squeezing themselves to one corner.

After initial introductions, the 4 co-passengers started discussing various topics, particularly in the areas of History and the Polity. Eventually, the discussion veered around to the formation of the Hindu Mahasabha and the Muslim League.

After the food, four vegetarian meals, arrived, the four ate in silence. When the pantry-car manager came to take the payment, the younger man (Narendra Modi) paid for all four meals.

Soon, the TTE came and informed the two women that the train was packed and he couldn’t arrange berths for them. Both men immediately stood up and said: “It’s okay, we’ll manage.” They swiftly spread a cloth on the floor and went to sleep, while the two women with wait-listed tickets occupied the berths.

As the train was nearing Ahmedabad, the politicians asked the two women about their lodging arrangements in the city. Vaghela told them that in case of any problem, the doors of his house were open for them. There was some kind of genuine concern in the voice or the facial contours of the otherwise apparently inscrutable younger one (Narendra Modi), and he told them: “I’m like a nomad, I don’t have a proper home to invite you but you can accept his offer of safe shelter in this new place.” The women thanked the politicians for that invitation and assured them that accommodation was not going to be a problem for them.

I leave it to readers to draw their own conclusions about the politicians involved in this episode.

My observations:

1.The entire episode took place far away from media scrutiny. The manner in which Shankersinh Vaghela and Narendra Modi conducted themselves speaks volumes about their character.

2.Since Ms. Sarma first wrote about this train journey in an Assamese newspaper in 1995, when neither Shankersinh Vaghela nor Narendra Modi was a minister or a famous person, it can be safely assumed that she had nothing to gain by writing an article praising them. As Ms. Sarma herself says, “It was a tribute to two unknown politicians from Gujarat for giving up their comfort ungrudgingly for the sake of two bens (sisters) from Assam.”

Please share your observations on this episode.

Zero tolerance

After getting a degree in Mechanical Engineering, the son of the Proprietor of a medium-scale automotive parts manufacturing company expressed a desire to work in his father’s factory.

The Proprietor asked his son whether he was prepared to join as a GET (Graduate Engineering Trainee). He would be treated like any other GET and be subject to the same rules and regulations as all other GETs. The son agreed.

The Proprietor’s son reported late for work on 7 days during the second month. Since the Factory Manager expressed reluctance to do so, the Proprietor issued a Warning Letter to his son, stating that if he reported late for work on more than 3 days during a month, his services would be terminated with immediate effect!

On the 23rd day of the third month, the Proprietor’s son reported late for work for the 4th time during that month. The Proprietor decided that, as per the terms of the Warning Letter, his son’s services would be terminated with immediate effect. When the Factory Manager requested the Proprietor to give the young man another chance, the Proprietor replied, “He was given his first and last chance along with the Warning Letter. Now he cannot be given another chance. Repeated latecoming is an act of indiscipline, and, as you are aware, we have a policy of zero tolerance to indiscipline. Today, if we relax that policy for my son, we will be sending a wrong signal to the other employees that we are willing to compromise on our zero tolerance to indiscipline. But, if we take proper action against my son’s indiscipline, the other employees will know that we will never tolerate indiscipline from anybody else.”

Indiscipline in any organisation can be prevented, or reduced to a very substantial extent, only if the organisation is known to have ZERO tolerance towards indiscipline, irrespective of the identity of the employee. The same is true of corruption and social ills in any society.

Win – Win (An unbelievable, but true story!)

The union leader promised the workers that he would ensure that they were given a 20% salary increase during the Annual Wage Agreement later that month. “If the management does not agree, we will go on strike,” he declared. The workers cheered!

3 days later, he sent the company’s Chairman a letter demanding 20% salary increase for all employees as part of the Annual Wage Agreement.

2 hours after receiving the letter, the Chairman telephoned the union leader and invited him for a meeting the next afternoon to discuss the Annual Wage Agreement. “I’ll certainly attend the meeting, but there’s nothing to discuss. We will not accept anything less than 20%,” the union leader said.

The next afternoon, the Chairman asked the union leader, “You said you’ll not accept anything less than 20%, but can I offer 35%?” The union leader was too stunned to reply!

The Chairman continued, “Our workers can get 35% higher salary, but only if they help the company generate the additional money to pay them that 35%. I’m offering 10% salary increase, 10% Attendance Incentive, 10% Productivity Incentive, plus a 5% Turnover Incentive. Of course, they will continue to get 8.33% Bonus, Leave Encashment and other existing benefits. Please discuss my offer with the workers and let me know the response. All details are here in this file.” The union leader took the file and left the Chairman’s office.

Two days later, the union leader told the workers that this was the first time in the last 22 years that any management had offered more than the union had demanded. He explained the details of the Chairman’s offer and explained why he was convinced that it was a genuine offer with no hidden surprises. The workers agreed that the union should accept the Chairman’s offer.

The Annual Wage Agreement was signed by the Chairman and the union leader two days later.

The company’s turnover increased by 50% the next year without any increase in the number of workers, all due to near-zero absenteeism and a substantial increase in efficiency and productivity. As agreed, the workers also earned 35% higher salary than the previous year.

Customer is king!

At 6.40 pm, I decided to leave for home. I closed the last file and shut down my PC, switched off the fans and lights, locked the door of the Sales & Service Department, and walked into the corridor.

Raj had locked the door of the Commercial Department just then, and we walked towards the lift.

Just as we reached the lift, we were enveloped in total darkness. When the lights didn’t come on after about half a minute, I remembered that the generator had had a breakdown the previous afternoon and was expected to be repaired only the next day.

Both Raj and I knew it was hazardous to walk down the stairs as some of the offices on the lower floors used the staircase to store the cartons containing their samples. We decided to wait till the electricity supply was restored.

“How was your trip to the Branch? Did you manage to collect all the outstanding payments?” I asked Raj.

“I managed to collect all outstanding payments, except for Victory Industries. Not only did the Proprietor flatly refuse to release the outstanding payment, he used the filthiest possible language against me,” Raj replied.

“What did our Branch Manager have to say about this?” I asked.

Raj replied, “This customer is expected to order 4 new machines a few months from now. The Branch Manager asked me to take it easy, and asked me to report that the Proprietor told me that they will look into this outstanding payment after they complete arranging the finance for the company’s expansion.”

“I think you should report the truth, including the fact that the customer used abusive language,” I said.

Raj thought for a few seconds, and replied, “You are correct. The Branch Manager won’t like it. Worse, our Managing Director will be upset if he learns about this. But I have no choice. I’m on leave for 2 days. I’ll submit my report when I return to work on Monday.”

Since the electricity supply had not yet been restored, we decided to walk down slowly and carefully down the stairs.

Raj returned to work on Monday. At about 11.00 am, the Managing Director called me on the intercom and requested me to meet him immediately. A few seconds after I entered the MD’s room, Raj also entered. As soon as we were seated, the MD said, “Gentlemen, I overheard your entire conversation on Thursday evening. You didn’t know it because it was dark, but I was seated in the Reception. That night, I told our Branch Manager that I know about this incident, and instructed him to tell the Proprietor of Victory Industries that, if he does not apologise unconditionally to Raj in writing within 3 days, our company would file a criminal complaint against him. Here is the customer’s apology letter.”

He handed a letter to Raj, and continued, “I have given them some time to release the payment. I am willing to accept a delay in payment, I am prepared to lose his next order for 4 machines, but I will never tolerate anybody misbehaving with my employees. The customer is king, but we are not his slaves!”

This post, based on a true incident, is a part of Write Over the Weekend, an initiative for Indian Bloggers by BlogAdda.