When Sanjaya Sharma joined Tata in 1980, the only people who could question the chief executive of a group company were its directors, and here too the queries were mostly about financial matters.
“In those days there was just no way someone could question a CEO,” recalls Mr Sharma, the CEO of e-learning organisation Tata Interactive Systems (TIS).
“But today you have eight people from different Tata companies – half of them in their 20s and 30s – sitting in front of you and asking questions about your leadership style, your strengths, the different opportunities available for the company, the scope for improvement in operations, and so on.”
No easy mark this. The JRD QV Award is a much coveted prize, one that has companies investing serious time and effort in pushing the excellence initiative in order to garner pan-Tata recognition as a winner.
TIS is one among dozens of Tata companies that have embarked on the 1,000-point excellence journey and leveraged the inputs of TBEM to improve operations and escalate performance. The methodology assesses core business aspects: leadership, strategic planning, customer focus, measurement, analysis and knowledge management, workforce focus, process management, and business results.
TBEM also serves as an umbrella framework for driving initiatives that range from governance, safety and ethics to corporate sustainability (CS), innovation and climate change.
Tata Review spoke to a few of these nearly-there enterprises – Tata Interactive Systems, Trent, Tata Communications, North Delhi Power (NDPL), Tata Daewoo Commercial Vehicle Company (TDCV), South Korea, and NatSteel Holdings, Singapore – to get a sense of the challenges and highs of the excellence exercise.
Excellence as a way of life
Indeed today, Tata CEOs are using TBEM as the single lever to move several initiatives. In Tata, the business excellence process – and the TBEM initiative – has become embedded in all business operations. Explains Sunil Wadhwa, managing director of power utility NDPL: “The various elements of TBEM form the core of our way of working and have enabled us to transform an ailing utility into a profit-making, consumer-centric organisation that has the distinction of being recognised as the first success story in power reforms [in India].”
NDPL has turned itself around by cutting transmission losses, boosting efficiency, and improving employee engagement to become an award-winning power company. Much of this is due to the business excellence structure the Tata group has crafted. “TBEM is an overarching framework for whatever is best that we want to do at NDPL,” adds Mr Wadhwa. “The assessment process is like a periodic corporate health check, with the external assessors acting as consultant doctors, except that they do not charge a fee.”
NatSteel people have found TBEM to be a tool that helps them see the interconnectedness of various aspects of a business. That the assessment process is held in a positive and development environment creates openness and transparency, and “brings clarity to what is important to us, enables us to re-examine why we are operating in this manner and make improvements”.
The key to improvement
To align its workforce to its vision and values, TDCV has set up a process of annual workshops with key employees. Another focus area is ethical management practices. “This has played a key role in our management system and contributed to promotion of ethical awareness among our employees,” says Mr Choi. Having started down the TBEM path, TDCV is now, in turn, spreading the good word on business excellence to its subsidiary, Tata Daewoo Sales Company.
Adopting the business excellence model helped make Tata Communications – earlier the state-owned Videsh Sanchar Nigam – a part of the Tata family. Daniel Castle, the company’s chief quality officer and vice-president, business excellence, says TBEM is incorporated into the organisation’s orientation so that “everyone who joins Tata Communications gets an understanding of it. It is part of the Tata brand identity”.
At TIS, the business excellence framework has already achieved what chief operating officer Albert Lewis calls critical mass. He explains that TBEM has become a unique vehicle for propagating change and new ideas and concepts, for instance, by encouraging safety consciousness or even green consciousness.
“TBEM has indeed become a part of our life,” says Mr Lewis. “We talk of the business excellence model in our induction sessions, inculcating it in new recruits from the beginning.”
Most of these new recruits are impressed by the model and many are eager to become assessors and interact with other Tata companies. For senior executives, becoming an external assessor is almost a prerequisite for taking up a job. Says Mr Sharma: “It is absolutely integral to our way of thinking. It gives us a common vocabulary.”
Learning from far and near
At TIS, for example, a team member from Tata Steel Europe, along with a Baldrige assessor, held a presentation on safety that was considered brilliant. Says Mr Sharma, “I had not come across the aspects of safety that they explained.”
Even mentoring brings with it a new kind of exposure. A mentor at the assessment of pesticide company Rallis India, Mr Sharma found that best practices can be transposed across industries.
NDPL is another such good learner, picking up a plethora of good practices from companies far removed from its field: ethics management from Tata Steel, CS from Tata Chemicals, project management from Tata Projects, risk management from Tata Motors, call centre processes from Tata Business Support Services, etc.
Apart from benchmarking with Tata Motors, Korean company TDCV has used TBEM to absorb processes on safety, CS and ethics from Tata Steel. NatSteel in Singapore has adopted Tata Chemicals’ leadership system and a highly useful document called the Mother Of All Charts (used to present a complete view of strategic planning output) from Tinplate Company of India.
For all its benefits, the excellence journey is no sinecure. Most companies find it tough to roll out the initiative across diverse business units and subsidiary companies. Mr Castle points out that the problems are more acute for a company such as Tata Communications, which has grown inorganically, acquiring companies not just in India but around the globe. Many of the acquired companies come with their own – and well-entrenched – processes.
Multiple business units add confusion to the mix. For instance, Teleglobe, the Canadian enterprise acquired by Tata Communications, is part of the company’s global voice services group. The company also created a global data and mobility services group to take advantage of its capabilities around servers.
But this resulted in two different narrations while filing the TBEM application. “We are a complex entity in terms of business and certainly more global in nature than most other Tata companies,” explains Mr Castle.
The second challenge was developing a customer-centric culture from ground up. Consumer service facilities were virtually non-existent and consumer records were either incomplete or missing. Consumer-friendly processes and systems were also absent at the time of the takeover. Given the near-insurmountable odds, NDPL today is proud that it scored 500 points in its very first TBEM assessment, ample testimony, Mr Wadhwa says, “to our success in building a unified culture in the organisation”.
Managing growth is another major challenge for the company. In 2009, when its TBEM score was 562, Trent had 32 stores; today there are 57 Westside stores, a figure that will burgeon by 2014 to 100. “We are witnessing exponential growth,” explains Mr Nagabhushan. “Our challenge with business excellence is to manage this growth.”
The not-so-sad tribulations of rapid growth include supply-chain management, vendor development and employee retention. Trent started down the excellence path in 1998, crossed the 450-mark in 2004, 500 in 2007 and breached 550 in 2009. “The pursuit of excellence has helped in achieving business goals,” remarks Mr Nagabhushan. “But of late, with the increase in complexities brought on by the adding of stores, formats and people, there is a tremendous amount of churn.”
The plus point is that TBEM can be synonymous with change management, as it encourages management to adopt new best practices. “The assessments throw up many things, and we realised we had to be more focused on cost. So we became cost-focused, then we became review-focused and now it is improvement-focused.”
At NatSteel the biggest challenge related to the company’s culture: how to shift from a command-and-control setup to one of mutual trust, transparency and process management. According to Mr Kamra, the challenges were two-fold: growing a critical mass of business leaders who understand the TBEM principles and apply them when running their businesses or in their day-to-day work; and building an understanding that these principles are fundamental to running a business, and that it is not just an assessment tool.
The fundamental point, in this context, is that if TBEM is not understood well and practised in its true spirit, it becomes merely a “time-consuming document exercise”, taking away focus and time from making the “real” changes a business needs to implement before it can excel.
Realising that it is crucial to get everyone on board, NatSteel invested much time and effort in developing “a reasonably well-articulated document that serves as a communication tool to all colleagues on what we have in place and what we plan to do”. In fact, communication itself can sometimes pose a challenge when TBEM goes global to countries where English is not the first language. At TDCV, for example, most of the TBEM initiatives and activities are translated into Korean before being disseminated among employees.
During external assessments, questions and answers go through an interpreter, with the risk of miscommunication especially in specialised terminology. Later, the feedback from TBEM has to be translated into Korean so that it can be understood and used by employees for improvement activities.
According to Mr Nagabhushan, Trent has been a consistently profitable lifestyle retailer even during the global recession. “There is hardly any other example in retail of a company paying dividends year after year,” he notes. TDCV has used TBEM to enhance productivity and sharpen its competitive edge, along with sustainability initiatives such as climate change. NatSteel is using the programme as a tool to establish common work systems and nurture a common culture across its businesses. In 2012, it will put in its first joint NatSteel Group application for the JRD QV Awards that will include businesses in Singapore, Australia, China and Vietnam.
NDPL has initiated extensive benchmarking exercises where the company is collaborating with high performing Indian utilities as well as the Global Intelligent Utility Network Coalition, a coalition of international utilities, to exchange, understand and adopt best practices.