CEO-Connect forum of Department of Management Studies IIT Madras, recently had the privilege of hosting Mr. R. Srinivasan from ITC Ltd. Mr. Srinivasan is an Electronics & Communication engineer from IIT Kharagpur('74) and has held several responsibilities in several businesses of ITC (including Tobacco) across India, in a career spanning over 34 years. He is currently a member of the Corporate Management Committee (CMC) and looks after 5 of ITC's 13 businesses with 5 of the CEOs reporting to him----Paper & Paperboards, Packaging, Stationery, Matches, and Agarbattis. He is also on the Governing Body of the Indian Institute of Packaging and a member of the CII National Committee besides being a non-executive Director of Asia Tobacco Ltd and Wimco Ltd. He is a member of Bestprax Club, Qimpro Foundation.
Mr. Srinivasan started the session by enlisting the things audience wanted to hear which ranged from leadership issues, supply chain management, role of ITC in rural transformation, difficulties of diversification, surrogate advertisement to competing with HUL and P&G. He assured that he would try to cover as much as possible in the session. Mr. Srinivasan started with the shareholder’s perspective who buys the stock and then wants to be happy forever. Companies like ITC act as trustees who need to multiply the shareholders money so as to ensure returns better then that provided by the banks. The results of such as organization is monitored by many stakeholders like employees, customers, suppliers & business partners, government, society and environment. This is where differences arise between companies like ITC and organizations like Ramakrishna Mission. ITC cannot afford to lose money of its shareholders but they have to fulfil a societal purpose also. Striking the balance is the key here.
Talking about processes, Mr. Srinivasan said nobody becomes basketball player overnight. People select roles very carefully according to their strengths, weaknesses and capabilities. Then processes are put in place to deal, track and make sure that things get delivered. Strategy, Structure, System and Quality Assurance system play important role in processes. Strategy should be continuously evolving unlike Indian Hockey team which failed to reciprocate to the changing nature of the game by sticking to the old strategy. Structure helps in having some restraint and discipline but it should not become a limiting consideration. System is required to deal with individuals and keep them aligned to the organizational needs. Team may have individual stars but if they are not aligned to the team’s requirement, it can be a disaster. Quality assurance is much more just quality of products. It extends all other processes having input and output.
Taking up the topic of leadership, Mr. Srinivasan stressed over the fact that people very often wrongly think that leadership is all about Managing Directors and CEOs. We need leadership at all level to ensure unity, alignment and control. Leadership has many similarities with parental duties which include increasing the number of subroutines so as to make them manageable. He gave examples of how parents teach their kids and these learning can be applied in corporations. Then Mr. Srinivasan went on to explain the life cycle theory of leadership.
Talking about ITC, Mr. Srinivasan stressed on triple bottom line policy of ITC which includes fulfilling the economic purpose, not messing up with the environment (ITC is a zero carbon organization) and fulfilling the social purpose (through e-Chaupal). ITC started with Cigarettes and then moved into printing; later on following a government regulation where no company could control more than 50% market share, ITC started diversifying into other sectors. Company now have 13 businesses. Through e-Chaupal initiative ITC is trying to improve the rural condition if not solving the problem completely. Every year population equivalent to that of Australia is added to our country’s population which presents a huge opportunity for the marketers. Mr. Srinivasan said brand presence of ITC lacks the charisma of TATA and Reliance; that is because ITC sells brands (bingo, wills etc.), not the company.
In the end professor T.T. Narendran thanked the distinguished guest and presented a memento as a token of appreciation from the Department of Management Studies.