Academic, businessman, consultant, CK Prahalad dons many caps. Named among the top ten management thinkers in the world in every survey for over ten years, CK Prahalad is a thought leader whose contrarian beliefs have impacted managers globally. We present here a profile by Kamini Banga of the man who may well be the most influential thinker on business strategy today.
- A stubborn five year old, son of a district judge and a Sanskrit scholar, has to be often punished by his father whom he respects and whose approval means everything to him.
- A young nine year old goes to the Madras Corporation School.
- A fourteen year old sits quietly in a corner listening to his father discuss religion, philosophy, railway law and the scriptures with a steady stream of visitors every day. He is fascinated by the abstract concepts.
- A fresh BSc graduate joins as a supervisor on the production floor of a multinational company and turns out to be the best negotiator with the tough unions of the 1960s.
- In his first year at the Indian Institute of Management, Ahmedabad (IIMA), he tops a class packed with engineers from the Indian Institute of Technology (IIT) to everyone’s surprise.
- He returns to his alma mater to teach business strategy but soon realizes he cannot achieve his life’s ambitions there and leaves, with wife and young children and virtually no money, to pursue a DBA at the Harvard Business School.
- He settles down in the USA and becomes a global thought leader and leading consultant to Fortune 500 corporations, hobnobbing with business, political and blue-blooded czars.
- 25 years later, the evangelist sets his sights on India, selling a concept of a world class India to Indians and to the West.
The influential academic and consultant walks the talk, he invests millions of dollars of his own money to become an entrepreneur. The world watches with bated breath.
c k prahalad: the contrarian
I have begun to believe that CK is a man who defies any label. Just when you begin to believe that a description fits him, he breaks the mould. But then is that so surprising? His father, CR Krishna Rao, the single most important influence in his life, was himself an unusual man for his times. He would have been disappointed had CK decided to pursue music but CK admits that literature would have been all right. At a time when most South Indian families wanted their children to join the IAS or pursue engineering, he was not keen on CK doing either.
A man of great learning, he instilled in his son the joy of constantly challenging personal boundaries. A Sanskrit scholar, he took a year off to write a monograph on what the ‘Brahmatarka’, an ancient philosophical treatise, would have looked like had it ever been found. CK remembers him studying multiple volumes of the classificatory system for library science by Dr Ranganathan and finding inconsistencies which nobody, apart from him and the author, had ever discovered. This was his way of having fun. The immense joy that CK finds in problem solving is inherited from his father.
Abstract concepts and philosophical issues still tug at his heart-strings and CK regrets not doing his PhD in physics. “Whenever you read in the newspaper about a basic discovery being made, of somebody figuring out what happened a billion years ago in the universe, that is more challenging intellectually.” Management does not seem to have filled the void. “In management we never really ask fundamental and philosophical questions. We should but we don’t.”
Apart from his father, CK had two other mentors. A works manager at Union Carbide instilled in him the value of reading besides introducing him to the world of management at nineteen. The managing director of India Pistons, “a very young and a very aggressive man”, helped CK not only acquire a general management perspective but also recognized the time had come when he could no longer teach his protégé and asked him to enroll for a DBA.
CK believes in taking lessons from history and this road to a global thought leader has taught him several things. They have stayed with him and continue to nurture his thinking and his spirit. As Sumantra Ghoshal, Professor London Business School, writes in his article, Crossing The Rubicon, “There are moments in our lives when a desire turns into a volition or a will to do and then there is no turning back. Being thrown out of the train was one such moment in MK Gandhi’s life which set him on the road to freedom.” There have been several such moments in CK’s life and each has played its part in instilling a set of values.
take on challenges: not one to shy away from challenges, CK seeks them out. His life story is dotted with difficult and can’t-be-done-has-never-been-done-before tasks. At the age of twenty something, he became the first quality control manager at Union Carbide, a position until then always held by a foreigner. Senior management’s attitude that Indians were not good enough to handle quality control drove CK to create a record in the market place. During the Chinese aggression, Union Carbide was asked to supply military batteries. However, the parent company would not transfer that technology to India. CK went to the head office in Kolkata to work out the plant configuration from basic designs and helped set up the assembly line to manufacture those batteries in an old factory in Chennai. “If it can be done, it can definitely be done in India” is Prahalad’s motto. He demonstrated the same spirit at IIMA where he was determined to do better than the best.
seek out opportunities: CK’s next job was at India Pistons and on his first day there, the Managing Director, MK Raju, asked him to walk around the plant and tell him what he thought of it. CK’s confident reply was that he could cut down costs by at least 20%. Raju suggested he should not narrow himself to just industrial engineering projects but take a broader perspective of the business. He was appointed executive assistant to Raju with a broad mandate. That was just the right opening for somebody like CK.
He started the company’s first ever management training program recruiting from the IITs and leading engineering colleges. A massive computerization program followed as early as the late 1960s. CK decided to introduce an innovation in the way computers would be used. The machines were slated to computerize payrolls, but that, he argued was a waste as there was not much scope for error and the system was self-correcting. Workers would certainly commit murder if salary computations were incorrect. Where computers were needed, was in planning complex production schedules. The Venkatraman Commission, which was at the time preparing a report on the impact computers would have on the labor force, was impressed by this new thinking. And CK even wrote some parts of the program in Tamil so that semi-skilled factory hands could work on the computers. His argument was simple. “If I can explain to them how it can be done in their language and what impact it will have, they will have no objection.”
use time effectively: as a supervisor at Union Carbide, CK always managed to finish his work in about two hours. The rest of the time he spent teaching himself cost accounting. The young manager organized the workers into groups, each with a team leader whose job was to constantly report to CK about the units produced in a specified time period. If everything was on schedule they would not bother him but any deviation meant informing him immediately so that he could take corrective action. This freed him from routine tasks yet produced quality results. Also, the time spent learning cost accounting came in very useful at IIMA and later on in life.
take pride in who and what you are: his childhood years at the Madras Corporation School have left an indelible mark on CK. When the principal of Loyola College made a disparaging remark about his schooling, he stoutly defended his teachers and schoolmates. Sitting next to a boy whose father owned buffaloes and sold milk taught him more about India than anything else would. “The poor are not so different from us as we are given to believe.” He never fails to remind his children that, “Probably the only difference between you and those
children is a college and luck.” In the US, Gayatri and CK made a conscious effort to keep the spirit of India alive in their children.
“Whenever there was any accomplishment by an Indian, we told them about it. We did not want them to feel like second class citizens because they were Indians in the US.” His children do not believe that India is world class, nor does CK, “But still there is an inherent strength and beauty in India.”
At the same time, CK and his family have consciously imbibed some of the American values that they admire. Taking responsibility for oneself is on top of the list. A healthy respect for other people’s views is another. It is perfectly legitimate in America to disagree and it is almost obligatory to voice strongly held but different points of view. That nobody is above the law draws high praise from CK as he remembers his fascination with the process of Nixon’s impeachment.
Another virtue he believes the Americans have is that they are, by and large, very religious. Most of all CK admires the open, society-wide discussions over serious issues such as stem cell research, the death penalty and the process of gradual consensus building. So over a period of time, CK has retained what he believes is the bulwark of Indian tradition and has adopted what is valuable in the country he has chosen to be his home.
confront your boundaries: CK is constantly upgrading himself by reading or teaching himself new skills. While he still dreams physics, he is glad that he did not pursue it since he would never have made the grade and being second would never do for CK. While acquiring new skills, he is always evaluating his performance. “At IIMA I was not just studying, I was also evaluating what I had done at Union Carbide.” His unbeatable performance at IIMA, he attributes to perspectives he gained at his first job.
win over people: to lead, one must learn to be a follower, believes CK. As a supervisor he had to set the piece rates, always a contentious task in manufacturing. This was especially tough since the workers saw supervisors as part of management and did not expect them to be just.
Before fixing the wages, CK however, worked with them for days on end to arrive at what is possible and therefore what is fair. The rates were tough and the union leaders argued hard but they always agreed in the end. He would spend a lot of time with the workers, talking about their children, their motivations and needs. He still treasures the gold chain that the workers gifted him at his farewell.
help people realize their potential: what makes CK such a great teacher? “My goal is not to teach tools and techniques because those will change but if I can give students a perspective on their role as managers and if that makes a small difference to the way they approach their life, that is good enough for me. I am most passionate about how to get people to realize their own potential and how to get people to think as much about others as they think about themselves.” In his writing, CK focuses on helping people think beyond themselves and on how to accomplish more with less.
At the Madras Management Association, CK set up a computer simulation program, offered on weekends. Anybody could register for the program. At a time when computers were not what they are today, he made the knowledge accessible to a lot of managers who would probably not have received this training elsewhere. However, for CK, helping people does not mean free aid or subsidies
though he has no problem with making credit available to those who need it.
exit the comfort zone as soon as possible: just when he has found a comfort zone you would imagine he would settle down. Not CK. He is constantly testing himself with new challenges in uncharted territories. Academic, management guru, entrepreneur, “Intellectually I think I am quite a contrarian. I talked of global competition in my book, Managing the Multinational, long before it was mainstream. Then I had to make a new investment. I did not want to continue what I had done and feel good. So I put myself in a totally uncomfortable position and then over a period of next six or seven years I wrote a lot of pieces with Gary Hamel. That work culminated in the book Competing For the Future. Now I am looking at two very interesting issues: one is called the Bottom of the Pyramid and the other, Poor as a Source of Innovation. At the same time I am looking at another dimension: what if you start looking away from a firm-centric view of the world to a consumercentric view of the firm. It is almost turning it 180°.”
emotional fulfillment through relationships: CK sets great store by emotional support and nurture provided by the family and attributes a large part of his success to his wife, Gayatri, and his two children who carry the flame for India as passionately as CK does. He believes the family must derive its strength from individual members deciding what is good for the family rather than what is good for the individual. “When Gayatri decided to give up her career, she did it only because she thought it was good for the family. And I would do the same. Now my daughter has decided to give up her job because her husband has found his dream job and they have to move. I was so relieved when she took this decision. Her mother had done the same.”
He inherits his sense of family values from his father. While he describes the relationship between his father and the rest of the household as “detached involvement”, fifty years later he plays a far greater role in his children’s professional and personal lives. Everything is hotly debated and discussed. “If one walked into our house and saw us at the dinner table, they would think these people do not like one another.” But some things continue in the same tradition: aiming for excellence, intellectual pursuits and respect for parents though the children may politely express views that are different.
set the bar: living up to CK’s expectations could not be easy for anyone. He has set the bar for his children and he makes it very clear that their falling short is going to disappoint him. They do not debate any more that the children have to excel in whatever they pursue, the children just expect it as a statement of fact. For CK it is second nature. “I got so used to people around me, starting with my father and those I worked with, expecting high standards and perfection.” When his son announced his decision not to go into management and pursue biochemistry instead, in a sense, CK’s dream of doing his PhD in physics was coming true. He also approved of his daughter taking up economics for her undergraduate studies and later an MBA. There is no denying CK’s drive to raise the bar continuously for himself and for those around him. He sent his children, raised in the US, to Japan and Singapore for work experience. It had to be an ordeal by fire. Baptism would only be complete when they had made a go of it in unfamiliar territory. Comfort zones are for the weak and not the true inheritors.
As a global leader what are his views on leadership?
A leader has to have imagination, the ability to imagine what others cannot see. Passion, if the leader’s vision is intellectually compelling and emotionally empty, it will not work. People must be able to see that you believe in what you are doing. Courage to break new ground knowing that it could fail. Courage to be a non conformist and to pay the price of being a leader— loneliness. Personal excellence, if you are not committed to personal excellence it is very hard to motivate others and sustain that motivation. Humility and respect for humanity, leadership is about helping others, improving other people and seeing the growth potential in them. Learning from others, leaders are those who learn quietly from others, they listen to people with different ideas and choose their own direction.
Who in his view are great leaders?
There are several names in CK’s lexicon of leaders but he names only a few: Mahatma Gandhi, Lal Bahadur Shastri, Nelson Mandela, George Patton, Peter Drucker. According to CK, Gandhi had moral leadership of a phenomenal kind. Peter Drucker is intellectually great and even at 90 comes up with new ideas. Shastri was truly Indian and understood what India was really like. Nobody expected much from him but he ushered in administrative reforms and the agricultural revolution.
All the lessons learnt in the past have served him well and will continue to help him in the future. But what does the future hold? He has been a teacher, a consultant and an entrepreneur, which of the three roles has been the most satisfying and which one will he go back to?
The transition from one role to another has been both easy and difficult, admits CK. Consultancy provided him material for research and the two, consultancy and research, together made his teaching material contemporary and alive with real issues. Consultancy also offered intellectual stimulation, something that CK thrives on.
Starting a company, however, was exciting only in the initial period when there was new learning every day. After that it was not intellectually demanding and only a matter of attention to detail and motivating people. CK saw no new learning for himself and has now engaged a CEO to run the company. He would like to focus all his energies on teaching and consulting.
He must return to his first love: problem solving. Here he is at home rubbing shoulders with business and other leaders.
What are the challenges he sees ahead for himself?
As expected, the challenges he has set for himself are of the unusual kind. He is working on something that will make people think differently about competition and strategy. He feels there is one more book left in him and it will not be about managing people. He is grappling with issues like the assumptions we make about society, the shape of the future and how does one go about creating the desired society of the future. The answers for the questions he seeks for are difficult: how has progress in the past led us to greater poverty, more disenfranchised people and more wars?
He thinks it has something to do with increasing industrialization, greater information access, widening disparities and unequal opportunities. The outcome of all these endeavors, he feels, is uncertain and may lead to frustration but the intellectual challenge they pose is enough to keep him going.
His most outstanding contribution?
Motivating students and being a good teacher. His greatest satisfaction comes from seeing people realize their full potential. CK would like to be remembered as a good husband, a good father and a good teacher who cared.
and finally, a quote to describe him: “Do not go where the path may lead, go instead where there is no path and leave a trail behind.”