Aura of Business

Every other day we hear about the government’s initiatives for upliftment of the rural poor. How much these proposals materialize is a different issue. But hardly do we see individuals coming up with something on their own with the sole intent of helping the rural poor and empowering them financially and socially. It is this excellence in microfinance that has made Muhammad Yunus and the Grameen Bank so popular and relevant in today’s times.

The origin of Grameen Bank can be traced back to 1976 when Professor Muhammad Yunus, Head of the Rural Economics Program at the University  of Chittagong, launched an action research project to examine the possibility of designing a credit delivery system to provide banking services targeted at the rural poor. 

OBJECTIVES 

The Grameen Bank Project (Grameen means "rural" or "village" in Bangla language) came into operation with the following objectives:

· Extend banking facilities to poor men and women

· Eliminate the exploitation of the poor by money lenders

· Create opportunities for self-employment for the vast multitude of unemployed people in rural Bangladesh

· Bring the disadvantaged, mostly the women from the poorest households, within the fold of an organizational format which they can understand and manage by themselves

· Reverse the age-old vicious circle of "low income, low saving & low investment", into virtuous circle of "low income, injection of credit, investment, more income, more savings, more investment, more income"

METHODS EMPLOYED TO ACHIEVED EXCELLENCE

The Grameen Bank's Method of action can be illustrated by the following principles:

Start with the problem rather than the solution: a credit system must be based on a survey of the  social background rather than on a pre-established banking technique.

Adopt a progressive attitude: development is a long-term process which depends on the aspirations and committment of the economic operators.

Make sure that the credit system serves the poor, and not vice-versa: credit officers visit the villages, enabling them to get to know the borrowers.

Establish priorities for action vis-a-vis to the the target population: serve the most poverty-stricken people needing investment resources, who have no access to credit.

At the beginning, restrict credit to income-generating production operations, freely selected by the borrower. Make it possible for the borrower to be able to repay the loan.

Lean on solidarity groups: small informal groups consisting of co-opted members coming from the same background and trusting each other.

Associate savings with credit without it being necessarily a prerequisite. 

Combine close monitoring of borrowers with procedures which are simple and standardised as possible.

Do everything possible to ensure the system's financial balance. 

Invest in human resources: training leaders will provide them with real development ethics based on rigour, creativity, understanding and respect for the rural environment.

All these efforts of Muhammad Yunus through the Grameen Bank have helped in upliftment of lacs of people in Bangladesh. With the success of the Grameen Bank, the concept of microfinance has been adopted by many other countries. So much has been the success of the Grameen Bank that it is being supported by economic institutions the world over like the IMF, World Bank, etc.

Excellence in the thoughts and efforts put in by Muhammad Yunus has been the key in bringing about significant changes in the lives of lacs of people. Excellence can be achieved only when due thought has been given towards the steps necessary for attaining efficiency and effectiveness.

Effectiveness of Transformation

Every organization faces challenges. Often the case is that, at any point of time, one department of the organization may perform extremely well while some other department may not. The real challenge is to carry the organization forward through these hurdles through support and cooperation. This is very well demonstrated by the Valley Crossing Exercise.

 

The Valley Crossing Exercise

 

 

As the photo depicts, there are 3 people who are carrying a bamboo with them. The bamboo represents the organization and the 3 people represent the different departments. The 3 people have to cross a valley safely and reach the other side. The width of the valley is such that at any instant, it will completely have a person hanging on the bamboo and the hanging person will have to be supported by the other two persons.

 

During the exercise, anyone of the three persons can be at the following three risk levels:

Risk free (safe) – Completely on ground

Half Risk – One half on ground and the other half hanging

Full Risk – Completely hanging

LEARNING FROM VALLEY CROSSING EXERCISE:

TRUST :  The single most important factor for their success was the trust factor. Trust was necessary for them because when somebody was in full risky state all of his hope were on the other two and if any of the two failed then he could have fallen into the valley. But he kept on the faith and made it to the other side of the valley . Similarly even in commercial level we need to trust others. We need to trust other people and have faith in their talent and capability.

 

 SHARING OF RESPONSIBILITY :  At all the positions while crossing everyone shared equal responsibility.At no time was any person more responsible for a success/failure than the other one and this defines why they had success in the end. They showed great responsibility while carrying each other. Similarly in our business world we need to share and take responsibility . Unless we take it ourselves nothing would be beneficial for us. Once we start taking it and execute it properly we will see results showing good in our favor as well.

  

FOCUS :  Focus was one thing that they did not lose. Until they had reached their goal they did not even shifted their focus for a single bit. This defines a true quality of an entrepreneur. One should never lose focus till one has reached where he had aspired for.

 

COORDINATION : Nothing would have been possible unless there was coordination at place. If they had lost a single bit of coordination  at any point then the whole idea would have failed. Similarly in our business world we need to coordinate things properly. If not done well the whole thing could go haywire resulting in utter failure of the concept in spite of hard work.This coordination should be there all throughout the hierarchy of the organization .

 

Monks who changed their lives

Three Monks

Prof Mandi - a monk in terms of his teaching pedagogy has yet again arrived with a distinguishing style of teaching.Graphics coupled with good audio enhances the impact of the Educational medium.

Three Monks is a Chinese animated short, released in 1980 and directed by A Da. It is one of the most famous and beloved of Shanghai Animation Film Studio's productions, and has won awards at film festivals throughout the world.
In the movie : -
"one monk fetches water to drink",
"two monks carry water to drink"
"three monks"
The unfinished third sentence reflects the film's central question, which is whether the three main characters will learn to work together so that they can all have water to drink.






The movie highlights the following learnings that we must incorporate in order to achieve the management in an organization. 

1. Designing Team Work.
2. Defining Team Roles.
3. Cohesiveness.
4. Achieving Excellence Efficiency & Effectiveness.

Designing Team Work: -

The movie succinctly portrays the transformation monks carried while designing the work;
In first case monk 1 carries two buckets of water on his shoulders so as to achieve the best possible ergonomics and efficiency.

In case 2 monks design the system using scale to design the best possible way to carry the bucket of water with minimum effort i.e. max efficiency.

In case 3 monks design a system using Pulley (an involvement of innovation) to come up with a solution to divide the work. 

Scientific and objectives measurements and instruments  used to resolve the conflict.

Defining team roles : -

When only one Monk was there he was doing all the work necessary for the monastery but as the monks increased the work increased and they started facing problems. Even though they came with a design to solve the efficiency they could not work effectively.

The problem of effectiveness could only be solved when they designated the roles to each other in the end. The roles were not only specific but also equivalent.

Cohesiveness : -

In the situation of crises Individual sums become bigger than what was there individually .

Excellence Efficiency & Effectiveness : - 
Workplace efficiency, performance and productivity can often be improved by introducing and measuring any change to working practice.
Three Monks did it by making change in the working practice by pulling the water through pulley instead of fetching it each time.

Goals Setting

How Important are Goals for an organization ? Imagine a cricket or a football match or any sport for that matter without a goal or a score to be achieved. We watch it keenly so as to see the goals to be achieved. But are organizations equivalent to sport? Well, the fact is Organization play a bigger sport. Effects of a sports match could be seen only on field for some time after it. But Organization reflects society, we can imagine the catastrophic effects that an organization can cause if they operate without goals. It's important for the existence &  the purpose organization serves to set goals for it.

Now the question is what kind of goals should organizations have ?

How do we know what kind of goals to set? The whole point of setting goals, after all, is to achieve them. It does no good to go to the trouble of calling meetings, hacking through the needs of organization, and burning up precious time, only to end up with goals that aren't acted on or completed. Unfortunately, this scenario describes what far too many managers do with their time.

The best goals are smart goals — well, actually SMART goals is more like it. SMART is a handy acronym for the five characteristics of well-designed goals

• Specific: Goals must be clear and unambiguous; vagaries and platitudes have no place in goal setting. When goals are specific, they tell employees exactly what is expected, when, and how much. Because the goals are specific, one can easily measure One's employees' progress toward their completion.
• Measurable:What good is a goal that one can't measure? If one's goals are not measurable, one never know whether employees are making progress toward their successful completion. Not only that, but it's tough for employees to stay motivated to complete their goals when they have no milestones to indicate their progress.
• Attainable: Goals must be realistic and attainable by average employees. The best goals require employees to stretch a bit to achieve them, but they aren't extreme. That is, the goals are neither out of reach nor below standard performance. Goals that are set too high or too low become meaningless, and employees naturally come to ignore them.
• Relevant: Goals must be an important tool in the grand scheme of reaching one's company's vision and mission. It should be Relevant to the society which it is reflecting and to the employees that it has.
• Time-bound: Goals must have starting points, ending points, and fixed durations. Commitment to deadlines helps employees to focus their efforts on completion of the goal on or before the due date. Goals without deadlines or schedules for completion tend to be overtaken by the day-to-day crises that invariably arise in an organization.
  
  SMART goals make for smart organizations.
  Goals are often unclear, ambiguous, unrealistic, unrelated to the organization's vision, unmeasurable, and demotivating. By developing SMART goals One can avoid these traps while ensuring the progress of one's organization and its employees.
  In experience of Prof. Mandi in NITIE, goals should also be like an Fibonacci spiral which should be increasing arithmetically with feedbacks of past to challenge the future. 

Craftsmanship V/s Modern Management

Organizations –  

How often we come across this news where we read about a Company’s Expansion, Production & Growth.

Year on Year growth, Quarter on Quarter Growth, Better performance Month on Month, bigger market share

What makes it flourishing for so long? Of course constant productivity but how it has become possible for companies to do it constantly for decades and for some of them for centuries?

Well, the answer is, these are not mere companies, these are organizations.

Organization organizes everything that comes in its way of serving its vision.
Company is started by individual or few set of people but is turned into an organization for prolonged growth. The process of turning a company into an organization is what is Modern Management is.

Organization is derived from the Greek word "organon", itself derived from the better-known word ergon which means "organ" – a compartment for a particular task.

An organization does compartmentalization of specific work & that way creates a redundancy.

Now Question is whether multitasking of an employee with in the organization is good or not.

Experiment: -

To find an answer. We carried an exercise with one of senior professors of NITIE (Dr. Mandi), the institute which is known for its productivity led revolution across the nation.

The exercise was of tower building:-

Craftsman

It was carried out by

1. a Single Individual setting a target for himself.

                    & then

2. It was carried out by 3 people:- 

a. A doer who is blind folded.
b. An instructor but who will use only his mouth in the process.
c. A motivator who will be cheering them with the incentives.

Case 1: -

The goal was to build a tower of  at least 20 blocks. He can utilize all his wisdom and hands and every other resource he had.
He was able to build 22 blocks and then the tower fell.

Modern Management with-Blind Folded Doing his task

Case 2: -

The goals set was higher than in the first case, it was set for 23 building blocks. it has to be built by a blindfolded person with someone instructing him.

Result:

A blindfolded person was able to build whooping 26 blocks without being able to see with the help of instructions and motivation.
  An example of MODERN MANAGEMENT and organization practices.

Moment of accomplishment

We came out with following conclusions: -

	Craftsmanship (1 person doing all the work)	Modern Management (set of people)
Scope of work	Ambiguous	Crystal Clear
Skills	Skills Increases	Skills reduces with time(same job every time)
Satisfaction	Remains same or increases	Decreases
Time	remains same always	Increases the first time but keeps on reducing after that
Productivity	Remains Same	Increases time after time

Transformation

Flashback: 2 months back, Date: 3^rd April, 2013.

 It was time when the sun showcases its real colors and powers all across the country. I came here in NITIE, Mumbai for the interview of Post Graduate Diploma in Industrial Management. When I first get down from the Auto-rickshaw the hoarding read as National Institute of Industrial Engineering. Hold on, I said, in mind. I read it as Engineering?? A sudden thought in mind, I am already an engineer, I want to do management, why am I here? Will it be another course in engineering?? All sorts of thought process stopped for a while when I entered the mesmerizing campus, it feels like I was on the lap of mother-nature with:

“Large trees welcoming, stretching their arms with twists and turn,

And a pond by side reflecting the glare of sun,

96 steps to climb with zest of overcoming perspiration,

As the atmosphere all-around promised learning & fun"

Now: Date: 13^th June, 2013.

I joined the college. Things have changed here, it was still the lap of nature, but instead of sun this time tiny droplets (big actually) did the welcome. It was raining cats & dogs in Mumbai. It feels like somebody has painted trees with dark green color. The pond was ready to be burst into lake. The 96 steps looked slippery instead of barren this time.

Date: 18^th June, 2013. Time: 0900 hrs.

It was the class of Principles of Organizational Management, first class of the day, a Prof. with a simple look entered the class, all greeted the prof. he had a glance at class and then sat down on the floor. Yes, with blossoming smile sat on the floor and called everyone to come & sit with him. All quite baffled came and sat down with him. He smiled looking at the faces of each one of us. He said with utter politeness, “please be comfortable to sit on chairs if one is not willing to sit down, I love you if you choose to sit on chair.”

He said, “You are in NITIE, Please ask me questions? All that you ever had in your mind” I went back to that time when the question aroused in my mind 2 months back when I got down from the auto-rickshaw. From the charisma he carried, he looked like a ‘sadhu’ sitting under the tree of board and us as ‘Shishyas’ sitting and looking curiously at him.

He then slightly pulled out toys out of the basket & thrown them amongst the sitting students asking them to have a look at them. The toy looked like a butterfly; one looked like a sponge ball and then another one was a replica of newton’s 2^nd law of motion with 5 balls suspended and transferring the momentum.

Differential Point of view:-

He asked to look at toys and tell him what it is? The answers came as butterfly, ball and suspension. He laughed and said, “I doubt you all are engineer”. He held the butterfly from its tip with a pen and it was not falling down, he held the ball in his hand it had the globe printed upon it then he held the 5 ball suspension model in his hand, he pulled 1^st ball and released it, the 5^th ball got displaced the equal distance as the 1^st ball was pulled, he then pulled 1^st & 2^nd ball together and released them, the 4^th & 5^th ball displaced equal distance as the 1^st & 2^nd ball. He then pulled 1^st 2^nd& 3^rd together and asked what will happen, nobody came out with a concrete answer.
The point he said is to come up with an opinion, irrespective of what will happen one must have an opinion upon it. He said, “I used these 3 toys because you all are engineers and you have knowledge about these things, you should have an opinion upon it.”

Presentation:-

One of the most important things is presentation; although all three looked like normal toys if presented in good manner could lead to the impression it makes.

Creating Value:-

He explained knowledge, value & business should go hand in hand. He explained, “Being an engineer you are expected to have knowledge, to create a value out of it is Innovation and being able to channel it to the right person is business.”

As the 2 hours of the class came to an end I realized as the climate has changed drastically now from the time when I came here last time the perspective at looking at things has evolved too.

Now

Engineering or Management no matter what name we give it – it’s always the learning experience that’s going to matter henceforth.