Transactional Analysis and Games People Play

You’ve had a long day a day before. There was an urgent release to be deployed. You give your best shot to debug it. After a lot of grueling hours and wrestling with the issues, you do manage to deploy it successfully and go back home at 2 – 3 AM to catch a few hours of peaceful sleep. You start the next day in an up bit mood, expecting that your immediate superior would say a few good words about you.

It’s almost afternoon and there’s no news from him/her. You become restless but still assume that everything would be working fine and gently give a pat on your own back to appreciate yourself. Suddenly, as you are about to leave for the day, PM/Senior storms into your cubicle, firing you for an issue that surfaced in the release. The heaven you enjoyed throughout the day suddenly turns into hell. You get irritated yet defensive. You try to defend yourself for the issue but the senior is in no mood to listen. “I had told you umpteenth times to follow the processes. Do your documentation properly. But you never listen! Look, what you have done now. Now, stay here and clear the mess you have created”, he barks at you and again, storms out. Poor you could only mumble, “I myself am confused how this can happen. I really dunno what to do” Fortunately, another colleague of yours just comes round the corner, tries to soothe you and says, “Ok. Now that we know we’ve got a problem, let’s concentrate on the solution, instead of putting blame on someone and letting him defend it” He helps you with your task and you manage to make home by 11 PM. You toss and turn in your bed wondering with mixed feelings about whatever happened.

I wish that nobody should go through such an incident but then this, indeed, is a familiar scenario. In this small incident itself, one could see three different personalities, their attitudes and feelings. Even you yourself have changed your moods from tired yet pushing, to a satisfied and happy, to anxious, to scared and then again a mixture of Satisfaction, Anger and anxiety.

Ever wondered why you feel what you feel? What is that that stimulates your mood? Who controls your feelings and reactions? Well, they say, “Mind has its own reasons which the Reason is not aware of!” Many philosophers like Aristotle, Kant contributed in their own ways to find the reasons of the mind, laying up the base for Psychology.

But if there’s one name that pops up in our mind when we say “Psychology”, it’s Sigmund Freud. It was he who first pondered upon the human behavior and the things that influence it, in the early 20th Century. He proposed that Human Personality is essentially made up of three components: Id, Ego and Superego. In brief,

Id: Person’s inherited unconscious psychological impulses; the irrational and Emotional Part of Mind

Ego: The part of the mind that reacts to reality and has the sense of individuality; the rational part of mind.

Superego: This is the advanced part of the mind that acts as a conscience and responds to the social rules; the Moral part of mind.

This also means that human mind is multifaceted. Thus, a person is not one single component but a mixture of them, colliding and crossing each other, imprinting the person’s thoughts, behavior and feelings.

The Freudian thoughts prevailed and are still considered the foundation of psychology. But this branch of science lacked an important thing: A fundamental Unit. There was no such unit available in Psychology, the way we have atoms in Chemistry.

In late 50’s, a psychoanalyst named Dr. Eric Berne thought of an approach quite contrary to the then beliefs. While the methods used by Freud and Co were individualistic i.e. revolving around an individual, Berne stressed on the social intercourse people have as the base for his study. Rather than Freudian method of keeping “I” or “Me” at the center, Berne proposed that it is easier to analyze a behavioral problem simply by witnessing what is said or how something is done by an individual.

He coined the term “Transactional Analysis” – the method of studying the interaction between individuals. In 1958, he penned a paper named “Transactional Analysis: A New and Effective Method of Group Therapy” in which he defined Transactional Analysis as:

“The unit of social intercourse is called a transaction. If two or more people encounter each other... sooner or later one of them will speak, or give some other indication of acknowledging the presence of the others. This is called transactional stimulus. Another person will then say or do something which is in some way related to the stimulus, and that is called the transactional response."

What is so different about Transactional Analysis?

In early 50’s, Berne handled many cases as a practicing psychiatrist at Carmel, California. Treating his patients, he noted down the subtle non – verbal changes the subject goes through during the session. In one such counseling session, Berne treated a 35 year old lawyer. During the session, the lawyer (a male) said "I'm not really a lawyer; I'm just a little boy." But the outside world knew this patient as a successful, hard-charging, attorney. Later, in their sessions, the lawyer would frequently ask Dr. Berne if he was talking "to the lawyer or the little boy." Berne was intrigued by this, as he was seeing a single individual display two "states of being." Berne began referring to these two states as "Adult" and "Child." Later, Berne identified a third state, one that seemed to represent what the patient had observed in his parents when he was small. Berne referred to this as "parent." As Berne then turned to his other patients, he began to observe that these three ego states were present in all of them. As Berne gained confidence in this theory, he went on to introduce these in a 1957 paper - one year before he published his seminal paper introducing Transactional Analysis.

Please note that no person could always be under control of any one of the “Parent”, “Child” or “Adult”. Depending upon the various phases of life and even the day, these three states control the behavior of an individual.

The Characteristics of the three states:

Parent: The parent represents a huge collection of recordings in the brain of external events experienced or perceived in approximately the first five years of life. The external events may include anything that a kid experiences from the people nearer to him. As the majority of the external events experienced by a child are actions of the parent, the ego state was appropriately called Parent. The parent is authoritative, rigid and patronizing.

Physical - angry or impatient body-language and expressions, finger-pointing, patronizing gestures.

Verbal – “always”, “never”, “for once and for all”, judgmental words, critical words.

Child: Contrary to the Parent, the Child represents the recordings in the brain of internal events associated with external events the kid perceives. In other words, the Child represents the feelings and emotions that come along with the external events. Again, these are also built by the age of 5. The Child uses “Really” “That was Great” “It scared me” Here again, it does not necessarily mean that use of “Great” or any such word is an indication that the Child is in control. The Child state means that the emotion (anger, despair) is overpowering Reason.

Physical - emotionally sad expressions, despair, temper tantrums, whining voice, rolling eyes, shrugging shoulders, teasing, delight, laughter, speaking behind hand, raising hand to speak, squirming and giggling.

Verbal - baby talk, I wish, I dunno, I want, I'm gonna, I don't care, oh no, not again, things never go right for me, worst day of my life, bigger, biggest, best, many superlatives, words to impress.

Adult: Adult is when the kid starts to differentiate between what he observed (Parent) and what he felt (Child). 'Adult' is our ability to think and determine action for ourselves, based on received data. The adult is the means by which we keep our Parent and Child under control. If we are to change our Parent or Child we must do so through our adult.

Physical - attentive, interested, straight-forward, tilted head, non-threatening and non-threatened.

Verbal - why, what, how, who, where and when, how much, in what way, comparative expressions, reasoned statements, true, false, probably, possibly, I think, I realise, I see, I believe, in my opinion.

Also, while analyzing the behavior:

Only 7% of meaning is in the words spoken.
38% of meaning is paralinguistic (the way that the words are said, pitch, tone etc.).
55% is in facial expression.

To sum it up:

Parent is our 'Taught" concept of life
Adult is our "Thought" concept of life
Child is our "Felt" concept of life


According to Berne, effective transactions (i.e. successful communications) must be complementary. They must go back from the receiving ego state to the sending ego state. For example, if the stimulus is Parent to Child, the response must be Child to Parent, or the transaction gets 'crossed', and there will be a problem between sender and receiver.


For example, the fevered kid asks for a glass of water, and the nurturing mother brings it. In this case, the “Child” of the small kid directs an inquiry to the “Parent” of his/her mother. “The Parent” of the mother acknowledges this stimulus, and then gives the water to the kid. In this example, the “Child's” request is the stimuli, and the “parent” providing the water is the response. If the response doesn’t go back to the stimulus i.e. if the mother doesn’t listen and bring kid a glass of water, it’ll surely lead to an ineffective communication and a hostile feeling.

Berne’s theory became immensely popular amongst the common readers when he put forward his, otherwise not so interesting, concept in the form of a book “Games People Play”. Essentially, these are real time scenarios that capture the various patterns of human nature.


He defines these games as:

“A game is an ongoing series of complementary ulterior transactions progressing to a well-defined, predictable outcome. Descriptively, it is a recurring set of transactions... with a concealed motivation... or gimmick.”

I would just quote one of these interesting games.

Blemish:
Theme: Fault Finding

Purpose: To keep everyone, including oneself, looking in the other direction rather than the problem.

Blemish is commonly played by the subject with the attitude I’m – better – than – you in order to compensate for a depressive (I'm not-OK) primary position. By constantly pointing the finger at the shortcomings, real or imagined, of others, he/she avoids the spotlight and having to examine her own feelings of inadequacy. This person rarely ever gives straight complements or genuine praise. There always follows the conditional modifier: "That is really quite nice, except…"

Blemish players never feel comfortable around someone until they locate some convenient handle for fault finding. There is often a role switch, with the subject shifting to a Rescuer mode - "I hope you don't mind honest criticism . . . I'm only trying to help you . . . " and may follow it up with, "but that's OK, even I do that myself sometimes . . . let me show you how I deal with it . . . ," attempting to initiate a twisted form of closeness.

Chronic Blemish players are universally annoying to almost anyone without a strong uncompensated inferiority/ masochism streak. Consequently, their circle of friends is often severely limited, and relationships are generally seriously dysfunctional, mutually parasitic, power paradigms.

The “Games People Play” book remained the bestseller on the New York Times’ list for 2 years (really) becoming the first of its kind non – fiction book.

Dr. Thomas Harris, who was a student of Dr. Berne, expanded his mentor’s Parent – Child – Adult framework and applied them to various walks of life like Marriage, Career etc. in a book named “I’m Ok – You’re Ok”. This is another good book describing how the feeling of “I’m not Ok – You’re Ok” and other such combinations lead to various scenarios and which ego states would go hand – in – hand.

Finally, I find all the psychology fundamentals mentioned above are quite practical. Finding out – guessing – the state of the mind of the person you are interacting with would surely help make better communication.


Well, the Mind is really Mind – Boggling…



Regards,

Abhishek

P.S.:

In the past two Gyans I had talked about the way we make our decisions and the factors that influence them. So here’s just a small note on “decisions”

I should have… I would have… Oh…I could have…

Many a times, I see myself and almost all of us saying, “Had it been two years later, I surely would have done it” “If the opportunity would have come a year earlier, I would have grabbed it” and all such ifs and buts. But they say, “Hindsight is always 20/20” That means, if you would have been presented with the same situation and asked to make the choice, you would have surely made the same decision! After some time moves on, you could analyze the situation that prompted you to take that particular decision and hence, that hindsight is always pure, unbiased. So, if the choice you made is, indeed, appropriate to the then situation, why worry about things later?! Moreover, when we are wasting our time worrying, we are missing out on even more opportunities. Well, it’s all easy to say but hard to act upon but I would just like to end this longest Gyan so far with a telling anecdote:

A passenger was traveling in a train. With no place to sit, he was standing and carrying his heavy bag, shifting the weight time and again. The conductor came to him and said,” Sir, you can keep the bag down. The train is capable of carrying both you and your bag!” May be it’s time for you to let the train carry the load!

Blink - Malcolm Gladwell

Have you ever wondered how we take our decisions? I’m sure that given a choice between “Logical, well reasoned” and “Impulsive, on the spur of the moment”, our answer would, most probably, be the first one. As an intelligent being, we usually take into account all the options presented to us, analyze them, imagine the consequences of all the probable choices and choose the option that gives us the most favourable outcome.

Well, things aren’t always that simple.

Let me present you a puzzle. Remember, no mathematical formula could be of any help to you in getting to the solution. The only thing that you’d need is what you have generally seen so far in your life. So here goes:

A man and his son are in a serious car accident. The father is killed, and the son is rushed to the emergency ward. Upon arrival, the attending doctor looks at the child and gasps “This is my son”! How can the Doctor say something like that?

It could be that you might have heard of this puzzle earlier but did you really wonder, at least for the first couple of seconds, that how this is possible? Or did it strike to you, the moment you read the question, that the Doctor could be a female – the mother of the injured son?

Well, the first Gyan of the year 2006 is also the first of the three articles on Psychology – and specifically, on how we take snap judgments, even without making a conscious, logical attempt to do so. Trust me, I’ll try my best not to make the write up as boring as it may sound when you heard of the word “Psychology”.

The punch line of the book “Blink” penned by Malcolm Gladwell itself is quite catchy: “The power of thinking without thinking” Using day – to – day examples from various fields of life like Art, Business, Police etc., the author presents his ideas in simple English without making much fuss about the jargon.

They say, “First Impression is the last impression” and rightly so. It is in the first meeting that we make most of our observations and conclusions about a person or a thing, in other words “judging book by the cover.” * The brain receives large amount of data through the senses. And it is the brain’s job to make some sense out of this chaotic burst of information. To make this task easier, it tries to search for typical patterns – could be called as a “Preconceptions.” And even when you are trying to think logically, the preconceptions residing in your brain quickly ride over your logical thinking and take a decision. Perhaps, you would have observed it while solving the above puzzle. Of course, these quick decisions can’t be absolutely right or absolutely wrong always.

To start with, the author presents a test. There are two categories: “Male or Career” and “Female or Family”. The test taker is asked to relate the words presented to him with these two categories. These random words include something like: John, Home, Capitalist, Lisa, Kitchen, Corporation, Children etc. In the first run, it takes very less time to relate the words with the categories, putting John and Capitalist in the “Male or Career” category and Lisa or Kitchen in the “Female or Family” category. However, when the categories are changed to “Male or Family” and “Female or Career”, it takes a longer time for the test taker because he/she finds it difficult to relate words like Corporation, Capitalist to “Female or Career” category even when they are related to Career. Same holds true for “Male and Family” as it is hard to correlate words like Home, Kitchen etc. with a Male even when these words are related to Family. I guess, it would have answered your curiosity why you found it a bit difficult to imagine a female to be a doctor because most of the times, we have that preconception that the Doctor has to be a male!

On the similar lines, when we meet a new person, we make our first assumptions by his/her attire and the face. Psychologists have come up with approximately 5000 combinations that the 43 odd face muscles can make. Depending upon the patterns, one can thin slice every facial expression and come up with some conclusions about the nature, habits of an individual. When we meet a person, unconsciously the brain observes and compares these expressions with the ones already present. Of course, it is not always possible for the brain to capture minutest movement of a facial muscle and hence, we tend to make a wrong snap judgment.

When a customer enters a car showroom, the salesperson usually tends to guess his financial conditions, his budget and which car can be sold to him, just by looking at him. The author gives an example of a successful salesperson who refrains himself from guessing about the customer. His experience tells him that even a badly clad gauche could be filthy rich and is sufficiently cashed up to buy the most expensive Car. Losing on such a customer due to early guesses and preconceptions would surely affect the sales. The successful salesperson presents cars to every customer with almost the same interest, without bothering much about their looks as they might be deceiving.

Talk of looks and personality, our image of “Boss” (a respected oneJ) is something of a person with imposing personality, masculine voice and charisma, and usually, we imagine him to be taller than average person. In US, approximately 14.5% of the men are 6 feet or taller. Surprisingly, the same percentage rises to 58% in the CEOs of Fortune 500 companies! Also, there are 3.9% men who are 6 ft 2’ or taller. The same percentage is, however, 33% when it comes to the same group of CEOs. Apart from the fact that these CEOs would surely have the necessary leadership and managerial qualities in them, the preconceived image of a Boss would have really helped them, in a way, to reach that position.

There is other side to the coin, as well. The snap judgments can be really useful and life saving at times. In a Fire Outbreak, a fireman felt that the fire is much serious than what it appeared to be. However, he didn’t notice any clear signs of a major fire. But, as soon as he asked all his colleagues to pull out feeling danger, the building collapsed! The probable reason for his snap judgment was that throughout his career, the fireman’s brain had unconsciously picked up symptoms of fire. In this incident, even when the fire didn’t appear to be quite serious, the senses picked up these subtle hints and set the unconscious mind in action. So, even before the fireman could actually figure out the actual fire, his unconscious mind prompted him of a danger and he quickly pulled out.

When you gather a good amount of experience in doing the same activity, you develop instincts/ gut feeling. Even when you can not give a logical explanation why you took a particular decision, the answer that “I just felt it”, “it just dawned on me” are and should be equally acceptable. They are the proofs that there’s a mind which is continuously running even without you noticing it.

Another example of difference between Systematic/Logical Thinking and Thinking in a blink of an eye:

To test their war preparedness and strategy, US Army set up two teams. One with all the strategy, Data, high end communication equipments etc. (Blue Team) and the other team led by a Vietnam Veteran (Red Team) Red Team was asked to defend the coast of Syria. The Blue team laid out a systematic plan to disable all of the Red Team’s communication equipments and to use satellite images to track the Red Team’s progress. The Red team led by the veteran however used the conventional ways to communicate like sending a dispatch on motorcycle or encoding the message in a prayer, instead of using Mobiles or other high tech gadgets. Also, they deployed fake ships to fool the satellites. Taking a preemptive action, they attacked and captured several ships of the Blue Team and left them surprised. Fortunately, this was only a simulation, had it been an actual war, the Blue team with its plans, Operations Net Assessment and other jargon would have faced high casualty within a short time. The reason for Blue Teams’ defeat is in their way of thinking. In a situation like war where snap judgments are much needed, following a procedure to carry out an order would surely take the precious time and delay the action. Also, they failed to take into account the use of conventional ways and to counterattack to make them ineffective. Whereas, for the Red Team, the veteran had developed a kind of “Gut Feeling / Hunch” that helped him in making quick decisions that changed the course of the war.

To quote Iacocca about gut feeling: while launching a new car or a product, you’d do market survey, research and gather almost 95% of the data that would help you to decide when to launch the product. If you decide to wait for another 6 months for the remaining 5% just to be sure of your decision, the market would have changed by that time and whatever product you thought of introducing in the market would be obsolete even before launching. To compensate for that 5%, you have to use your gut feeling or hunch to decide the best timing to launch the product!

Finally to sum it up all, neither the Logical Thinking nor the Unconscious, Blink – of – eye thinking are perfectly reliable. And the answer to how we think lies partly in both of them. Well, when they say “Listen to your heart”, it could very well be the power of thinking without thinking!


Regards,
Abhishek

*: Customers usually judge a product by the packing. There’s a meat producer named Harmel. On the cover of the container, they just put an image of a natural cascade (spring) between “r” and “m”. The customer relates the image of the spring to “Freshness” of the meat, even when the inside thing could be stale! The principle of not changing a successful brand or packaging lies in this customer psychology. The “New Coke” disaster was also one very good lesson to learn about Branding.

The Google Way

In the earlier Gyans on FedEx and JCB, I had said that it would be dream of any entrepreneur to see his company become so popular that it would be used as a routine word for some activity. Well, if it hadn’t been for this company, I wouldn’t have been able to post some of the Gyans (including this one) and all of the images. Yes, you got it… it’s “Google”! What started as a research project in January 1996, Google is a fairy tale – a typical Silicon Valley success story.

The decade of 90’s saw a major leap in computer world with the advent of Windows and Internet. The Silicon Valley – the cradle of the Computer revolution was crowded with new startups owned by young men, hardly in their 20’s. The computer and internet era showed a dream of quick money in huge sums for these mavericks.

The idea to connect the computers all across the globe through the internet opened avenues for hosting websites. These websites were the best way to advertise and reach to the customers in other parts of world. The number of websites soon started increasing in multiples and the need to search for a specific piece of information in this heap was felt. This need was partly fulfilled by search engines like Alta Vista.

At the start of 1996, two Ph. D. students at Stanford, Lawrence “Larry” Page and Sergey Brin, aged 22 and 21 respectively, set out to write their thesis on a Search Engine based on analysis of relations between websites. A year earlier or so, Sergey was assigned to show Larry around the university on a weekend tour. Reportedly, they did not hit off well to begin with, arguing about every topic they discussed. However, they soon found a common interest: retrieving relevant information from large data sets. And that was something that was going to help them with the thesis.

The existing search engines in those days were based on the number of times the keyword to be searched appears on the site. The site on which the particular keyword appears for the maximum number of times would be on top of the search results. But the hypothesis underlying Page and Brin’s thesis was: The website which has the maximum number of links pointing to it should be on top of the search results, clearly indicating that it is an important website. It was named BackRub as the algorithm checked for backlinks for the particular page.

The duo penned their concept in a research paper "The Anatomy of a Large-Scale Hypertextual Web Search Engine" and till date, it’s the tenth most accessed scientific paper at Stanford University!

On 15th September, 1997, www.google.com domain was registered and the company “Google” was formally launched a year later in Menlo Park, California. The story goes that the two founders wanted to name the company as “Googol”. (Googol = 10100) But the Venture Capitalist goofed up with the spelling and wrote off the cheque in the favour of “Google”! Well, Larry and Sergey later got ample opportunities to showcase their love for typical numbers in a different way.

In 1999, Google’s major rival Alta Vista relaunched itself as a portal. The users didn’t perceive this change positively. Google quickly cashed on this opportunity and grew at a much faster rate. In 2003, the company was shifted to a complex of buildings (named Googleplex) in Mountain View. (Incidentally, Googoplex is 10Googol)

One thing I, personally, like about Google is that it does exactly what it is supposed to do. If the user is searching for a particular keyword, then all he needs is a Text Box to enter the keyword and a “Search” Button! As long as the search functionality is working great, the user is least bothered about categories, links and other such things that only clutter the screen. And still today, the founders have made sure that the google.com home page screen is not at all cluttered with unnecessary things. And perhaps, this is the reason why Google succeeded in generating revenues when its other rivals perished in the dot com market.

In 2000, Google began selling advertisements associated with the search keyword to produce enhanced search results for the user. This strategy was important for increasing advertising revenue, which is based upon the number of "hits" users make upon ads. The ads were text-based in order to maintain an uncluttered page design and to maximize page loading speed.

On 4th September, 2001, U.S. Patent 6,285,999 describing Google's ranking mechanism (PageRank) was granted. The patent was officially assigned to Stanford University and lists Lawrence Page as the inventor.

2001 also saw Page stepping down from the top rank, making way for Eric Schmidt to be the CEO of Google. Schmidt started his career in Xerox PARC. Moving on to Sun Microsystems, he headed the development of Java project. Bringing an experienced CEO like Schmidt helped Google bring better management in the organization and the founders could concentrate on the expansion and introduction of new services.

In February 2003, Google acquired Pyra Labs, owner of Blogger, a pioneering and leading weblog hosting Web site. The acquisition secured the company's competitive ability to use information extracted from blog postings to improve the speed and relevance of articles contained in a companion product to the search engine, Google News.

Till 2003, Google was a privately owned company and had posted a profit of $105.6 million on revenues of $961.8 million. Then, it was decided that the company should go public. Morgan Stanley and Credit Suisse First Boston were chosen as the joint underwriters. Google also chose the unconventional way of allocating the initial offering through an auction ("Dutch auction", to be specific), so that anyone would be able to participate in the offering.

Now some numbers:

The long awaited IPO for Google took place on August 19, 2004. 19,605,052 shares were offered at a price of $85 per share. Of that, 14,142,135 (mathematical reference as √2 = 1.4142135...) were floated by Google and 5,462,917 by selling stockholders. The sale raised $1.67 billion, of which approximately $1.2 billion went to Google. The vast majority of Google's 271 million shares remained under Google's control. The IPO gave Google a market capitalization of more than $23 billion. Many of Google's employees became instant paper millionaires. Yahoo!, a competitor of Google, also benefited from the IPO because it owns 2.7 million shares of Google. The company was listed on the NASDAQ stock exchange under the ticker symbol GOOG. On August 18, 2005 (one year after the initial IPO), Google announced that it would sell 14,159,265 (another mathematical reference of pi = 3.14159) more shares of its stock to raise money. The move would double Google's cash stockpile to $7 billion.

Today, Larry Page and Brin themselves are worth $11 Billion each and joined ranks with the youngest self made billionaire like Bill Gates and Pierre Omidyar of eBay. The company has close to 5000 employees and revenues clocking more than $3 Billion.

In 2005, New York Times ran an article, “Relax Bill Gates, it’s Google’s turn as the villain” And many others see Google as the next monopoly after Microsoft in making. To know why, just have a look at the services Google now offers:

1) Google Print: This is considered as a big threat by the Author’s Guild in USA and has sued them for copyright. Google started off with digitizing every single page that is printed so far. Obviously, it will be far easier and cheaper to get any book in the electronic format that, otherwise, would have cost you a good chunk of money from your pocket.

2) Google News: This is considered as a threat by the media as Google provides one stop quick news portal pointing links to the latest happening. AFP has sued Google over this. I remember a link which describes the vision of Google to become the global media company in coming years. Epic (?) is going to capture the whole of world media. The clipping shows New York Times going out of the business because of Google and the concept of Newspaper is shown obsolete by 2010!

3) Froogle: Allows the user to shop online searching websites within a user specified budget.

4) Google Talk: Online chatting messenger using which you can talk over the internet absolutely free!

5) Google Earth: This is creating a lot of brawl these days. Using Google Earth, you can have a look at snaps of almost every point on the earth. This includes not only famous places but also cities of strategic importance.
6) Google Desktop: I love this. This is by far the best search facility to search for even a small keyword that appears in the files stored on your computer’s hard disk, e.g. if you are searching for “is”, the search result will show all the files, documents containing the word “is”! Even when you are searching online, it displays the contents that are already stored on your computer.

7) Orkut: This is making quite a wave amongst the youngsters. Basically, it’s a network of friends and you can search for and add long lost friends. You can publish your personal profile, what you like, your hobbies, snaps and so many other things!

8) Blog: Google acquired Blog to its serviceline (as mentioned earlier) It is derived from Web Log and helps put up your own articles on net.

9) G Mail: The first mailing service to provide 1 GB memory size!

I might have missed out on many things Google offers. But one thing that appears starkly here is that they are not much trying to directly attack Microsoft because Microsoft itself is notorious for eating up its competitors. Google has not, so far, directly entered the market where Microsoft is already the leader*. In fact, all their products so far are made to coexist with Microsoft (e.g. Google Desktop runs only on Windows), nor are they getting into debates of who’s better: Microsoft or Linux. This philosophy is well reflected in what Eric Schmidt said recently “We don't do the same thing as everyone else does. And so if you try to predict our product strategy by simply saying well so and so has this and Google will do the same thing, it's almost always the wrong answer. We look at markets as they exist and we assume they are pretty well served by their existing players. We try to see new problems and new markets using the technology that others use and we build." And this is the essence of their success: Just swim with the shark without messing up.

Well, there is still much more to write about Google and I hope, the book “The Google Story” would hold a lot of not – so – known facts and Google’s plan for the future. I’m waiting for it.

Whatever the Future may have in store for Google, the fact remains that it is, by far, theirs is one of the most successful stories of companies run by the Techno savvy strategists.

Regards,
Abhishek

*: Google comes up with modified logos to suit the occasion like Halloween, Da Vinci’s Birthday etc. They are called Google Doodles.
**: The buzz is that Google is coming up with Google OS. Also, the tide has, in a way, reversed as Microsoft is started competing with Google with its MSN Search and other offerings. There is another search engine coming up named “PreviewSeek” A good one!

Field Marshal Sam Manekshaw - 2

“Soldiering with Dignity” is a memoir written by Lt. Gen. Depinder Singh who was Military Assistant to Field Marshal Sam Manekshaw during the latter’s tenure as Chief of Army Staff (COAS). The persona of Sam Mankshaw himself is so great that his portrayal had to be interesting and worth a read.

After becoming the COAS (and also throughout his earlier career), Sam earnestly worked for the welfare of the soldiers. He worked, mainly, on two broad fronts. First one was to improve the situation, mindset of the officers and the soldiers; in his own words, “to instill Dignity”. He set out to achieve his task through many ways.

Back then, even the senior officers weren’t assured of their job because the rules were based on seniority. This means that there were chances that even a brave and capable officer would retire at the age of 47 – 48. The government was skeptical about paying out pensions for premature retirement and also, would not encourage doing so due to the training costs borne by the government. Sam convinced the government why it is important to revise the pay and pension structure for the soldiers and officers. He would argue even for the dress allowance, separation allowance. And these were completely just because the bureaucrats couldn’t understand the situation in which the soldiers fight for the nation and what they get in turn. Sam also paid attention to the construction of Army quarters and other military localities. He made sure that they are comfortable, equipped with all the essential amenities. This was just to facilitate living of the families of the soldiers when they are too far to take care of their loved ones.

Additionally, he took a keen interest in handling the issues related with postings and leaves for the soldiers. There were many instances where a soldier or an officer would have a request for leave or a particular posting due to personal reasons. Sam paid personal attention to see to it that only genuine requests are granted. Of course, it wasn’t a bed of roses. Some accused him of nepotism and favoritism. An anonymous person wrote a letter against a recent posting of the Director Weapons and Equipment. The reply was classic Sam and I can’t help but quote it here, ‘The Oxford Dictionary defines “Nepotism”, as ‘undue favouritism to relations”. Maj. Gen. X is a caste Hindu and I am equally high born Parsi. Therefore, there is no religious relationship. The General Officer is 50 years old and I am 58. Therefore, although I was a precocious child, best medical opinion would rule out paternity in this case. Unfortunately, I have not much scope for nepotism: it is almost too frustrating. The only competent officer from community is already the professional head of the army.”! Never again was any such complaint received from that quarter!

Talk about dignity and self respect, he asked the soldiers not to call any civilian by “Sir”. Of course, he demanded due respect and politeness but there is only one civilian – the Supreme Commander President of India who should be called “Sir”.

In another such instance, a combined meeting of bureaucrats and army officers was arranged to discuss some issues. When the meeting was about to start, a state secretary named Harish Sarin asked a colonel, “Hey, you there, Open the window” As the officer was about to get up, Sam’s voice boomed as he entered the room in his usual brisk pace “Sit Down” Sam turned to Sarin and said,” Don’t you ever call any of my officers by “you there” or any such thing! He is a colonel and deserves to be called by his rank, if you do not know him by name.” Sarin and all the other bureaucrats must have learnt their lesson.

He was the one who redesigned the Army uniforms and started the custom of putting name tags on them.

And there are so many such incidences clearly showing how Sam really was particular about things that matter to the Self respect and the dignity of the soldiers.

Secondly, he worked on regrouping and reorganizing the Army. New posts were created so that more young men can be attracted to join Army and the vacancy created by premature retirements could be compensated. He asked his fellow officers to campaign in the schools and colleges for the opportunities Army offers to the soldiers and how dignified Army life is. He also encouraged joint courses with JNU and other institutes so that the army officers can be technically sound and could think of making career even after retiring from Army.

Considering the constant threat faced by India from its neighboring countries, he stressed the point to equip and organize the various commands of Army.

In less than 2 years after becoming COAS, Sam was put to test as the issue of refugees from East Pakistan started becoming a thorn in the side for India. Even after this issue was brought to West Pakistan’s notice continually, no concrete action was taken by them. The situation was getting explosive day by day. The Indian government was facing pressure from the public for waging a war on Pakistan. In early 1971, Indira Gandhi arranged a meeting of the senior military officers and the cabinet to explore the possibility of the war and status of our preparation. Sam’s was the only voice against waging a war so soon. He argued that the army is not prepared for an all out offensive and by the time it will, the monsoon would start. So the best possible time would be after October as Army would be well armed and additionally, there wouldn’t be much threat from the Chinese as the winter would block their passes and routes. In spite of all the opposition from other cabinet members, Gandhi considered Sam’s advice and the wheels were set into motion for a planned preparation targeted for October. *

As usual, Sam was keen to know about each and every battalion, where it is posted, why it is required there and what they are supposed to do in case of attack. He carefully planned the details of all the strategic deployments and worked on getting the logistics and supply in place. He kept the intelligence on their toes so that latest information about the enemy is conveyed immediately to the Indian Army. Mukti Bahini – the rebels fighting against the East Pakistan authorities – had backing from India and that, too, was Sam’s suggestion.

It took 2 months for Sam to put his own Army in place. He was also the Chairman of Committee of Chiefs of Staff, comprising CoSes of all the 3 armed forces. And in spite of being the leader amongst the group, he made sure that he shares a good rapport with other CoSes and give them due respect and enough space to come up with their own inline strategy.

India declared a war on Pakistan on 3rd December, 1971 when Pakistan first attacked our airbases. How India thrashed Pakistan and forced it to surrender, making way for a free Bangladesh is a known history. Except a couple of incidents, the war was fought and won according to the plan. As promised by Sam, the war was over in 2 weeks! As a Chief of Staff and a great contributor to this win, he could have personally attended the Surrender ceremony but he asked Maj. Gen. Jagjit Singh Arora **, the then Commander in Chief of the Eastern Command, who himself played a major role, to sign the papers of the surrender as a reward for his painstaking efforts.

Sam was awarded Padma Vibhushan in 1972 and was conferred the rank of Field Marshal in 1973. ***

After a distinguished career spanning 40 years in Army, Sam “relinquished” his post of Chief of Army Staff for Maj. Gen. Bewoor – the then Commander in Chief of Southern Command. ****

He finally settled in a town named Coonoor along with his wife, daughters and grandchildren. Even at age 91, his photos still show his flamboyant and upright personality.

Sam always stood by his fellow men. He would go to any length to reach the people working at the lowermost rank. In a party, Sam was upstairs. He refused to come down to greet a few senior people, excusing himself for his broken leg. But then, he quickly sneaked out of the party, hobbled down the staircase to meet the sentry waiting down. Cracking a joke with him and slapping a pat on his back, he again hobbled upstairs. He could be always found talking to his subordinates, listening to their grievances and concerns. At times, the men were shy or afraid of expressing themselves and would tell him that they have no problem. Sam would promptly put an arm around his shoulder and say,” Sweetheart, if I have so many problems, how come you do not have even a single! Come on…speak up” No wonder, every soldier knew him. And it was one such servant in the Gorkha Regiment who knew him by the name “Sam Bahadur”!

Of course, it was not all kisses always. There were kicks, too. A division deployed in Nagaland was paying more attention to its own well being than to its duty. An infuriated Sam sent a box of bangles to the commanding officer with a note “Ask your men to wear them.” The division got its lesson and things soon became better. Sam was then again prompt to send another note “Send those bangles back, you don’t need them now”. I guess, the lessons are quite clear.

So many incidences portraying the larger – than – life personality and leadership qualities of this great National Hero of our times! It is simply impossible for me to capture all of them in a mere page or two!

And the image that still remains in my eyes is that of Sam striding upright and confident in his starched attractive uniform, inadvertently making others marching along with him look small…

Regards,
Abhishek


*: Apparently, the buzz around that time was that Manekshaw would soon take over the Government. He, in deed, was popular and in a position to carry out a successful coup. But Manekshaw believed in Democracy and never thought of doing so.

**: Maj. Gen. Jagjit Singh Arora made Gen. A. K. Niazi of Pakistan sign the surrender papers. Gen. Arora died recently. If I’m not mistaken, Niazi surrendered his revolver to Arora and it was stolen from the museum. If the theft news is true, it is really shameful for us.

***: Sam pointed out the wrong usage of the word “Honorary” in the earlier draft which was conferred on Field Marshal Cariappa and got it omitted.
****: Field Marshals never retire from Army. They “relinquish” their active post.

Field Marshal Sam Manekshaw - 1

The Human history is filled with wars. Wars – where everything is considered fair – is a game of power, tactics and leadership as much as is a game of weapons. Similar to the big corporations, these wars are considered to be good lessons of Management and Leadership.

These wars have given the world a lot of great warrior leaders, right from Alexander, Julius Caesar, to Napoleon, to Admiral Nelson, to Shivaji Maharaj and the list goes on…They only underscored that fact that what a good General can do with his leadership skills becomes much more important than the weapons, during the war. When things would go out – of – control, these leaders could motivate their men to give their best for the nation.

The post Independence era saw rising of one such great General who rose to become the Army Chief and later on the First Field Marshal of India.* He is S.H.F.J (Sam Hormusji Framji Jamshedji) “Sam” Manekshaw. Sam had played an instrumental role in defeating Pakistan convincingly in 1971’s war, freeing Bangladesh in the process.

Born in Amritsar on 3rd April 1914 to a Parsi couple, Sam was fifth amongst four boys and two girls. He had his schooling in Amritsar and at Nainital's famous Sherwood College. It would have been quite appropriate if Sam would have followed his two brothers to England to pursue higher studies – medicine to be specific. But then, his Doctor father saw him too young to go on his own in a foreign country. **

Sam then decided to join Indian Army. I guess, that was one of the best things that could happen to the Indian Army.

Joining the first batch of 40 cadets at Indian Military Academy (IMA), Dehra Dun on 1st October 1932, Sam passed out of the IMA in December 1934 and was commissioned as a Second Lieutenant in the British Indian Army.

During World War II, he was leading a counter-offensive against the invading Japanese Army in Burma. On a fateful day of 22nd February 1942, as he charged forward with his men, a Japanese soldier suddenly emerged from the bushes and fired at him, wounding him seriously in the stomach. Fortunately, Major General D.T. Cowan spotted Manekshaw holding on to life and was aware of his valour in face of stiff resistance from the Japanese. Fearing the worst, Major General Cowan quickly pinned his own Military Cross ribbon on to Manekshaw saying, "A dead person cannot be awarded a Military Cross."! In spite of 7 bullets piercing through his stomach, Sam survived!

Again, fighting in the then Burma, he got wounded again and was sent back to India.

With the end of the war, he was sent to Indo – China to rehabilitate Japanese PoWs. In 1946, he was sent to Australia to give lectures on Military warfare for about 6 months. ***

Soon, India got independence from the British rule. The subsequent unfortunate partition forced India into her first war against Pakistan. Manekshaw showed great acumen for planning and administration while handling the issues related to partition in 1947, and later put to use his battle skills during the 1947-48 Jammu & Kashmir Operations.

In 1959, Sam was posted as the commandant of the Defense Services Staff College. There, his outspoken frankness got him into trouble with the then defense minister, V K Krishna Menon, and his protégé of the time, the late Lieutenant General B M Kaul. A court of inquiry was ordered against him but he could manage a narrow escape.

The year 1962 saw the most humiliating defeat for the proud Indian Army. India was worst hit in the North East Frontier Agency (Now Arunachal Pradesh). Ironically, Lt. Gen. B.M. Kaul was commanding the 4th Corps in NEFA. The deteriorating situation soon forced the Indian Government to call back Kaul and replace him with Sam. There was a lot of anxiety amongst the soldiers. And Sam was given the tough job to breath life in the lost soldiers.

The day when he took over the charges from Lt. Gen. Kaul, Sam was to address the officer staff. He entered the room with his usual jaunty step, looked as if he were meeting each eye trained on him and said, ‘Gentleman, I have arrived! There will be no more withdrawals in 4 Corps, Thank you;' and walked out. But the charisma that surrounds the man had preceded him and soldier and officer alike knew the 'chosen one' had arrived and henceforth all would be well.

In 1963, he became the Army Commander of the Western Command. Soon after, the then Defense Minister Yashwantrao Chavan asked him which, Sam thinks, is the most strategically critical command in the Indian Army. Given the constant threat from China, a fuming unrest in East Pakistan and increasing insurgency in the North Eastern states, Sam told him that the Eastern Command was the toughest of all the commands. Chavan promptly made him the Commander in Chief of the Eastern Command – the Second top rank in the Army.

Proving the Government’s faith in him, Sam handled the tricky problem of insurgency in Nagaland very well. For this great work, he was honoured with Padma Bhushan in 1968.

The greatest honour soon came his way when he succeeded the then Chief of Army Staff (COAS) Kumarmangalam, to become the 8th COAS of India on 7th June, 1969.

Manekshaw is a formidable combination of prodigious capacity of work, fascinating charisma and charm, irreverence towards Red Tape, a keen eye on detail and above all a shrewd, sympathetic ability to lead and manage. Behind those hefty mustaches and piercing eyes were a caring heart and a witty brain. He stood against his superiors in unjust conditions and loved his subordinates, caring for them always.

Watch this space tomorrow to know more about his tenure as COAS, the contribution he made in winning the 1971 War and the qualities that made him a beloved War hero “Sam Bahadur” and more than that a popular Leader.

Regards,
Abhishek

*: There are only 2 persons who are ranked as Field Marshal for India so far, the other being General Kariappa.

**: Handsome and charismatic Sam always left women around him mesmerized by his charm. When asked “If he would have gone abroad to study Medicine, which doctor he would have preferred to be?”, he promptly replied “Gynecologist”!

***: In one such lecture, he talked proudly about the Indian Army. A Veteran Australian stood up and said,” Colonel, I appreciate what you’ve said about the Indian Army but we Australians are no less, in fact we are very proud of ourselves and our ancestors” Pat came the reply from Sam,” So you should be, you were selected by the finest judges in England!”

Reference: Sam Manekshaw: Soldiering with Dignity by Maj. Gen. Depinder Singh – his Military Assistant.

Gillette

During the Great Depression, Iacocca’s father once told him that even if people have absolutely no job to do or they have no buying power left, they would, in any case, need to eat for survival. And when all the other industries were failing, they opened a successful restaurant. Like hunger, there are some things nature has gifted to human beings that you really can’t help. They just keep growing. Beard is one of these “ever growing” things! (May be that’s why Kishore Kumar named one of his movies “Badhati ka Naam Daadhi”J)

In the modern days, a clean shaved face is considered a symbol of masculinity and sobriety. So, almost every morning, shaving becomes a scheduled task for most of the men around the world. And if there’s one man they would be unknowingly thankful to for making shaving easier and safer, it’s King Gillette.

King Camp Gillette was born on January 5, 1855 in Fond du Lac, Wisconsin. His father George Walcott Gillette was a post master, editor and had tried his luck at many other professions. When King was 4 years old, the whole family moved to Chicago where his father set up a hardware shop. However, in 1871, the Great Fire in Chicago destroyed their business and King, aged 17, was soon working as a salesman to support his family. While traveling all around the country, he happened to meet and work with William Painter who had invented the Crown Cork Bottle Cap. Working in Painter’s “Crown Cork and Seal” company, King came to know about the business of this first disposable item. With a dream to become a successful businessman, Gillette had tried his hand at stuffs like Water Valve and Electric Cable. He had secured the patent for them as well. But things didn’t quite work for him. Moreover, he lost $19000 in a futile attempt to produce carbonated water. Losing this big a sum was a major setback for him. Then, Painter advised a dreamy King to invent something like Bottle Cork that is disposable, something that assures great sales and repeated customers. King questioned him how many things there could be that are disposable except for pins, needles and other such stuff!

Well, the revelation of his life was soon to come on an 1895 morning while shaving. The irritation and may be a few cuts here and there must have made him wonder what if if I could come up with a safety razor that is disposable. The idea occupied his mind for coming few days. He asked for help from some MIT metallurgists but they turned him down thinking that it is impossible to produce a thin blade with sharp edge at a profitable price.

Finally 6 years later, a MIT graduate William Emery Nickerson came up with a blade Gillette had dreamed of. After making some modifications in the design, Gillette patented his product and started “American Safety Razor Company” in September, 1901 along with Nickerson. The company's name was changed in July 1902 to “Gillette Safety Razor Company”. However, actual production started in 1903 because it was very difficult to handle thin steel and sharpen it. The first year of 1903, saw a sales of 51 razor and 168 blades only! Gillette thought that this attempt is also a big failure. But the sales for next year: 90000 razors and 123, 000 blades made him stay in the business. He was also awarded the patent for Razor and Blade in 1904. By 1908, they had established manufacturing facilities in the United States, Canada, England, France and Germany. To make a brand for blades, Gillette started aggressive advertising. In 1910, a popular Baseball player named Wagner appeared in the Gillette advertisement. The tradition still continues…

Like Coca Cola, Gillette too faced problems with the imitators. Looking at the great market blades offered, lots of other companies tried to take away a bit of the pie. Imitations of the patented safety razor emerged and forced Gillette to pursue lengthy battles at court. In many cases, Gillette resolved the dispute by buying up ‘the imitator’!

World War I offered more opportunities for Gillette to grow as US Government equipped all the armed forces with Gillette safety razors, making 3 million razors and 32 million blades in circulation.

The company, thus, grown with productline including not only blades but also shaving creams, After Shave lotions and other shaving related stuff.

Associating Gillette with maleness, the company branded its products aggressively on radios and TVs, making it a global company. Gillette acquired several other companies in the personal care sector and expanded into other categories as well. Duracell, the battery brand, for instance, is part of the Gillette Empire and so is Braun, Oral – B. The Design of the patented Razor

On 1st October, 2005, Proctor and Gamble bought the Gillette Company (trading symbol G) for a staggering $57 Billion, making P & G the biggest personal care and household products company.

Even when Gillette himself was the founder Chairman of a global company like Gillette, he was a staunch anti – capitalist. According to him, Capitalism is the most unjust system in the world. It is the sole reason for poverty, illiteracy, misery and crimes. Money, to him, is the evil root of all. However, he advocated monopoly of big corporations, at the same time.

He was also a utopian socialist. He had published a book “The Human Drift” in 1894 advocating that all industry should be taken over by a single corporation owned by the public, and that everyone in the US should live in a giant city called “Metropolis” powered by the Niagara Falls. This city would have 25 storied buildings and anyone who wishes to stay in this city would have to work without any salary for 5 years! He had offered $1 Million salary for the then US President Teddy Roosevelt to become the president of this “Gillette World”. But Roosevelt, thankfully, turned it down. A later book, “World Corporation” (1910), was a prospectus for a company set up to create this vision. His last book, “The People's Corporation” was written with Upton Sinclair.

Retiring from the active business, Gillette spent next few years traveling around the country with his wife Atlanta. He handed over the company’s controls to his friend John Joyce who didn’t pay much attention to Gillette’s anti – capitalist philosophy and focused on new and improved blades and their branding. He introduced the famous Track – II blades having two blades for a smoother shave. The company invested a lot on the “Sensor” blades and how shaving can be made more comfortable. It took 5 years and $150 Million to invent Sensor blades. All the money was proved worth to invest as 240 Million Sensors sold in the first year itself!

And as fate would have it, the creator of so much wealth, the King of his “Gillette World” – King Gillette died in an almost bankrupt condition in 1932, as the Gillette stocks plummeted drastically during the Great Depression…

I know, by now, you must be wondering about the ups and downs Gillette saw in his life and the games Destiny played with him… And reflectively, your hand would have surely reached your chin rubbing it… And if it’s a bit rough there, it’s time to have a good shave with Gillette… Well, that’s “the Best a man can get”!

Japanese Management – 2

In the earlier Gyan, I had promised to write about the fallacies of Japanese Management, but some time later. But then, there were many queries and feedback asking for more information on this topic. So I’m just giving it a try.

As said earlier, the books published in 1981 named “The Art of Japanese Management” by Athos and Pascale and “Theory Z” penned by William Ouchi became overnight success and the American business pundits were forced to turn their attention to Japan and give due credit to Deming and Juran for the work they did.

But the other faction of Management gurus was no behind in bashing the Japanese Management Techniques. Soon, a flurry of Anti – Japanese Management books started flooding the market.

In 1981 itself, an author named Gibney published a book condemning Theory Z and blaming Ouchi of making false promises. In 1982 another author Bruce Brigs declared Theory Z “idiotic” and “dangerous”. According to him, Japanese Management has nothing to do with the amazing success Japanese companies have achieved and should not be attributed for it. It’s because of the workers who worked day in day out, without complaining against the management that these companies could turn things around.

His book and opinions were soon followed by one more author named Sullivan who criticized those Americans who think that implementing Japanese Management techniques in America would make them successful as well. He pointed out the qualities of Japanese people like obedience, paternal attitude and rigidity in following procedure that made these companies give good results. Implementing the same techniques as they are in a free country like America would not be advisable. The concept of “Life long Employment” preached by Japanese Management only makes the employee uncompetitive as he is assured of a job without taking any responsibility and risk.

In 1984, Sethi, Namiki and Swanson coauthored “The False Promise of the Japanese Miracle”. In this book, they extended the same views Sullivan had stated in his book. The principles of Japanese Management are the result of their culture and work ethics. Things like “Collective Responsibility” can work only in a country like Japan and not in US. Implementing these principles in US, without any thought and customization, would not only be a failure but a disaster. In Japan, the government and the companies share good relations. Government funds the ailing businesses to bring them back on track. In turn, these companies, too, provide necessary funding to the political parties. The upper echelon of these companies is called Zakai. Zakai is very influential and governs major decisions pertaining to policies and industries, to suit themselves, even when they are against the common man’s interest.

In Japan, the women are always suppressed and can work only on non – strategic posts of Secretary or Receptionist, etc, unlike US. The authors reiterated the significant part Japanese culture plays in their business and asked not to copy the principles of Japanese Management blindly.

The debate over Japanese Management can’t be complete without taking note of a Japanese thought leader: Kenechi Ohmae. Born in 1943 in Kyushu and educated in Waseda University, Ohmae doesn’t quite like to be called Japanese. Instead, he prefers “World Citizen”.

After graduating from Tokyo Institute of Technology, he went on to pursue Ph.D. in Nuclear Engineering in MIT. The credentials of Ohmae do not end here. In 1972, he started working at the Tokyo office of McKinsey and later rose to become a partner over a span of 23 years. He co-founded McKinsey's strategic management practice in Japan and Asia-Pacific. He also served as an advisor to Japanese President Nakasone. He had made an unsuccessful attempt to start a political party in Japan. Apart from doing all this, he has penned more than 140 books; amongst them are bestsellers like “Triad Power”, “The Mind of the Strategist”, “The Borderless World”, “Beyond National Borders” and “The End of the Nation State”. No wonder he is hailed by the titles like “The Only Japanese Management Guru” and “Mr. Strategy”

And well, if he wouldn’t have succeeded in becoming a Management Guru, he surely would have made a career as a Flute player. His flute is good enough to captivate a concert! A multi faceted personality, I must say!

In his books, Ohmae criticizes the principles of Japanese Management. He proved the fallacy prevailing about the Japanese Management that every decision is taken from bottoms up, involving all the layers of the organization or that Japanese companies do long term planning.

But at the same time, in his book “Mind of the Strategist”, he explains how Analysis and Synthesis play an important role in decision making at any Japanese company. Generally, more stress is given on finding out the important factors and the relation linking them. The methods are based more on intuition and lateral thinking than on logical thinking and statistics. The decision makers are logical and at the same time, creative.

Although, I haven’t read them, the crux of his other books “Triad Power”, “Borderless World” and “Beyond National Borders” is a portrayal of a combined market comprising of US, Europe and Japan, having a single currency and sharing economical and political power. According to him, any company that aspires to be globally successful must achieve success in these three markets. Today, the rich countries are outsourcing their business to the Third World countries in search of cheap labour. But according to Ohmae, the trend would soon change once the automation would replace the human labour. And hence, he advises not to rely on Third World Countries for labor. He also stresses on Globalization and the role to be played by the government in Globalization. No company, today, can afford to neglect globalization and should continuously improve and invent new techniques to stay competitive.

In spite of all the opposition from these Management Gurus, American companies made trips after trips to Japan to learn their techniques. On the lines of “Deming Prize” in Japan, America introduced “Baldridge” prize for quality. American companies started implementing Total Quality Management. Motorola declared that their profit increased by $3.2 Billion over 1987 – 1992 because of TQM and Six Sigma!

The decades of 80’s and 90’s taught Americans everything that was there to learn from Japanese companies. American economy also was doing exceedingly well. At the same time, Japanese economy was going through a sluggish period. The trend of Japanese companies buying American companies had reversed. Ford bought a 24.5% stake in Mazda that rose to 33% later. GM made a joint venture with Toyota and learnt their management techniques.

Japan had, thus, was left with not much to give to the World of Management. Japan itself was plagued with increasing bureaucracy, inefficiency, prolonged decision making process and ill effects of Life long employment; add to that the undue stress on continuous improvement (Kaizen)

As stated at the end of the earlier Gyan, Japanese companies could not invent and cash on the new upcoming opportunities like Mobile Phones and computer, where the US Companies had already got a big head start. Of course, this does not mean that Kaizen is ineffective. But somewhere it restricted the companies to improve on the existing processes and products only and provided less scope for research and development of new concepts. Japanese companies thus lost major breakthroughs. In view of the globalization, Japanese themselves started pointing fingers at the principles of Japanese Management, e.g. The collective decision making process was criticized by prominent Japanese like Yoharo Kobayashi of Fuji Xerox; Japanese banks adopted “Up or Out” strategy i.e. either you thrive in spite of the competition or you have no place in the organization. In short, Japanese again traced back American steps to “Hire and Fire” policy!

Well, in spite of all the debate, shortcomings, fallacies, criticism about Japanese Management, I can’t help but repeat the way I ended the earlier Gyan: Japanese Management has still given a lot to the World of Management …

The Japanese Management - 1

Japan – the land of the rising Sun. This small bunch of islands had always been under constant threat of volcano, earthquake and subsequent tsunamis; add to that the lack of natural resources and minerals. But post World War II era saw the mesmerizing rise of this country.

Well, a few centuries back, Japan was a closely guarded secret for the West. But as Japan started opening up its avenues for the westerners, the latter came to know about a lot of things that took them by surprise about the potential this small country held. By the turn of the century, the decisive win of Japan over Russia in 1905 clearly sent out signals to the West to take them seriously. As described in earlier Gyans, Japanese companies were making significant industrial progress, following the footsteps of their American counterparts. But with the World War II clouds gathering over Japan, the success of Japanese companies was soon to get eclipsed as they were forced to convert their factories to fulfill the country’s wartime needs. Subsequent destruction of Japan and iron clawed controls of US regime only made sure that the conditions would be as hostile and hopeless as possible for the industries to blossom. Japanese goods had a really bad reputation in the market. So much so that, in his famous song “Mera Joota hai Japani”, Raj Kapoor is shown wearing a torn shoe!

But in spite of all the odds, Japan sprang back to life in such a way that it can only be compared with that of Phoenix. It quickly surpassed the developed countries. Their economy was growing at a rate of 10% during 70’s. Even when the Japanese economy went through a major crisis in the 90’s, its GDP was 80% of that of US, in 1995! Giving US companies doses of their own medicine, Japanese companies made them run for their money. The whole of US industry pundits were divided into two clear sides: One who admired everything about Japan and the other who hated them equally! This hatred was expressed time and again so much so that in a movie “Rising Sun”, the Japanese Managers are shown devilish!

Well, whatever may be the consequences of the Japanese rising and downfall, the small country has contributed a lot to the world of Management.

It all started with a couple of neglected stars: W. Edwards Deming and Joseph M. Juran. I am running short of space and time to write in depth about Deming and Juran here. But, in short, these two can be attributed to think first about the quality. According to Deming, whenever we do an action, there is a “process” involved. If the process is faulty, the end product would obviously be faulty. The Management itself is largely responsible for the defects and should be held by the neck rather than the workers. It was he who introduced the concept of Total Quality Management. In essence, Quality is not a one time activity but a continuous process.

As fate would have it, no one in US listened to their words of wisdom and they were well forgotten. It was General McArthur who invited Deming and Juran to Japan to pull the Japanese industry from the shabby conditions they were in. Throughout the 1950 to 1970, through endless speeches and consulting, Deming – Juran explained the importance of quality to Japanese engineers and entrepreneurs. The efforts were soon to bear fruits.

In 1980, NBC ran a program named “If Japan can, why can’t we?” in view of Japan’s surprising progress. It was only then that America recalled their forgotten heroes. Soon, invitations and felicitations flowed in for Deming – Juran back in their home country. The circle was thus complete.

The year 1981 saw two books becoming bestsellers – William Ouchi’s “Thoery Z” (about which I had briefly talked in an earlier Gyan” ) and “The Art of Japanese Management” by Pascale and Athos. Even though, the subjects of these books were essentially different, they shared a common thread – Praise for Japanese Management. This started a flurry of American Managers making rounds of Toyota factories. On a lighter note, these managers were heard saying, “Let’s go for the Toyota pilgrimage”! The flow had changed its direction from Japan to US to the other way round.

Apart from the great work done by Deming and Juran, there were inherent differences between American way of doing business and that of Japanese. Even though, early Japanese managers made trips to US to learn about their industries, they made sure that they customize the processes learnt to suit the Japanese culture.

The basic difference between a Japanese and a US company is their hiring policy. In US where you are handed a pink slip the moment your performance goes down or the management doesn’t find a place to fit you in the system, in Japan Life time Employment is almost guaranteed, unless you don’t really mess up with your career. The Japanese companies are very careful while recruiting people because for them, it is a life time deal compared to the “Hire and Fire” policy of the US companies. In Japan, a lot of effort goes in training the newly recruited people so that they become good enough in all the major aspects of the business. As Akio Morita of Sony puts it, it’s like building a wall using stones of different shapes. If you want to build a new wall of different size and shape, you don’t need to throw all these stones away. All you need to do is to just rearrange them to suit your needs. Precisely, that’s what the Japanese companies do. For the all-round development of employees, they are frequently shifted from department to department, making sure that the job doesn’t get monotonous that way.

The hierarchy of the Japanese companies is driven by seniority rather than by merit. Even within the ranks of Management, there are grades. Depending upon seniority, the person is put in appropriate grades and ranks. Although the ranks drive the salaries and compensation, thanks to the Job rotation policy, they may not necessarily define the job. Also, as any person, in his early years, is basically a member of the union, he can correlate his experience as a worker once he is promoted to become a manager.

In US, whatever the Boss says, it is taken as the final verdict. In Japan, however, more stress is given on explaining the workers why they are doing what they are doing. A multilayer discussion right from the bottom most people – who are actually going to execute the decision – to the top management happens. This method is called “Ringiseido” As the workers are also involved in the decision making process, they contribute towards the betterment of the process and feel a part of it. Although, this process is time consuming, once the decision is made, the execution is very quick.

Back in US, Toyoda had observed piles after piles of inventory lying and rusting. Learning from that experience, he founded the JIT concept in Japan where the space crunch was always faced. The concept of JIT – Just – in – Time is simple. Whatever parts are required for assembling; only those would be supplied just before starting with the assembly. In Toyota, for example, parts required for the production in next one hour only are stored. Instead of keeping the raw material / subcomponents just lying around – which in turn means locked money – they are moved or ordered from the suppliers as and when needed, reducing wastage of time and money. An interesting note here is: Even Ford implemented JIT in their plants at River Rouge. It became so effective over a period of time that when the miners went on a strike in some other part of the country, the plant at River Rouge stopped its production within next 4 hours!

As can be seen, the success of JIT depends a lot on the suppliers. The manufacturing company needs to have good relationship with the suppliers. Many a times, the manufacturing company itself holds a stake in the supplier company. Such supplier companies are called as “Keiretsu” Managers from the parent company move to the Keiretsu Company in order to maintain bonds with them. Due to such strong bonds with the suppliers, the Japanese companies manage to produce double the cars compared to their American counterparts.

The supplier sends a card along with the material. This card is called as “Kanban” As the stock of materials deplete, the card is sent back to the supplier to indicate that it’s time to replenish the inventory.

As preached by Deming and Juran, quality is maintained at every stage of the process. Even a worker on the shop floor can stop the whole assembly line if he finds some defect. In a company which manufactures a car every minute, this delay would mean millions. But to the Japanese companies, these millions are well spent if they prevent a faulty piece to roll out of the assembly line. This practice is called as “Jidoka”. Every worker tries to improve the quality and the process. This continuous improvement is called as Kaizen and the groups of workers who discuss about the scope of improvement are called as Quality Circles.

A single concept mentioned above is worth writing pages after pages and I have just touched upon them very briefly. I’m sure I’ve missed out on many details like Poka Yoke and other such ideas Japanese Management gifted to the world.

After talking about all the good things, a small note on why it failed at some points.

As mentioned above, the continuous improvement is an integral part of Japanese Management. But while the company is busy improving the existing products only, the development of new concepts and products are neglected. A couple of good examples could be:

1) Japanese companies were trying to improve on the memory storage devices when their competitor Intel moved out of it and got a decisive headstart in Microprocessor manufacturing – a field hardly thought of by Japanese.

2) As Japanese companies continued improving cassette players and related stuff, advent of CDs, MP3 Players and computers took them by surprise.

How Japan became a major power in industry and how US companies retaliated to the Japanese all round attack is all very interesting and enriching. About that some other time some other day, but the fact remains that the Japanese Management did leave its mark on the whole world…

Regards,
Abhishek

The Toyota Way

Discussing Japan, and especially Japanese Management, without taking note of this company is just next to impossible. “Touching the Perfection”, this company is already the second largest car manufacturer in the world and soon heading to replace GM from the No. 1 spot. Surprisingly, what started as a Power and Automatic Loom Works, the company is now known for its quality and engineering in Automobile Industry. Yes, it’s Toyota.

It was Sakichi Toyoda who invented the power loom in 1902 and the automatic loom in 1926. He was the one who established the Toyoda Group of companies. The automatic loom would stop automatically if any of the threads snapped. His invention opened the way for automated loom works where a single operator could handle dozens of looms. Sakichi's invention reduced defects and raised yields, since a loom would not continue producing imperfect fabric and using up thread once a problem occurred. The principle of designing equipment to stop automatically and call attention to problems immediately is crucial to the Toyota Production System.

Even today, the company is still in the Computerized Automatic Looms, electric sewing machines and textile business!

The story of Toyota Motor Corporation began in September 1933 when Toyoda Automatic Loom created a new division especially for the production of automobiles. Kiichiro Toyoda – son of Sakichi Toyoda was heading this division. Soon, the division produced its first Type A Engine in 1934, which was used in the first Model A1 passenger car in May 1935 and the G1 truck in August 1935. Production of the Model AA passenger car started in 1936.

By 1936, Kiichiro had convinced his father that Automobile Business is the next thing they should jump in. So Sakichi sold the Power loom patents to a British company – Platt for £100,000! The sum was then invested in building Toyota Motor Corporation. The company was named Toyota, instead of Toyoda, because it took 8 strokes to write “Toyota” in Japanese and 8 was considered a lucky number! Jai Numerology! J

Till then, Ford and GM together shared 90% of the market and situation was not so encouraging for any startup to enter the automobile market. Kiichiro made a year long trip to Ford Motor Company and studied their methods in depth. Coming back to Japan, he not only implemented them but got rid of some of the inadequacies in the process and tailored them to suit Japanese industry. Kiichiro had observed piles of parts lying around in the factories in US. In Japan, however, he introduced Just – in – Time concept to reduce the inventory.

But soon, Toyota was asked to stop automobile manufacturing and to convert the factories to produce Trucks and other stuff for the Imperial Army. The urgent need to manufacture trucks made Toyota change designs of the trucks e.g. there would be only one head lamp on the hood instead of 2.

Fortunately for Toyota, the war ended shortly before a scheduled allied bombing on the Toyota factories in Aichi.

Soon after the war ended, Toyota moved back to its business. Commercial passenger car production started in 1947 with the model SA. In 1950 a separate sales company Toyota Motor Sales Co. was established (which lasted until July 1982).

The ending of the world war didn’t quite help Toyota to rise back to its feet because Kiichiro was forced to resign from the company by the Japanese government in 1950. The steering came in the hands of Eiji Toyoda, a nephew of Sakichi Toyoda. He had joined the Toyoda Automatic Loom Works family business after graduating from the University of Tokyo in 1936.

The reorganization forced by the government separated the family businesses and resulted in the resignation of Kiichiro and his entire staff. In the first year as Managing Director, Eiji followed the foot steps of Kiichiro to US to study the American automotive industry. After touring the Ford Motor Company operations, Eiji returned to Japan with a desire to redesign the plants. An important process learned during the trip was the Ford Motor Company suggestion system. Eiji instituted the concept and it is considered to be one of the major building blocks of the Toyota Production System of continuous improvement (Kaizen).

There was one other man who played a pivotal role in Toyota’s success. Taiichi Ohno, considered to be the creator of the Toyota Production System and the Father of the Kanban System, joined the Toyoda Automatic Loom Works after graduating from Nagoya Technical High School in 1932. Early in his career, he expanded upon the JIT concepts developed by Kiichiro Toyoda to reduce waste, and started refining the methodologies to produce components and subassemblies in a timely manner to support the final assembly. Taiichi Ohno made a smooth post war transition from loom works production to car and truck parts production. The war resulted in the leveling of all Toyoda Group Works production facilities, but under the management of Eiji Toyoda, the plants were gradually rebuilt.

In 1957, Toyota entered the US Market with Toyopet Crown. In 1958, only 287 Toyopet Crowns were sold in the U.S. Toyota's first experience in the U.S. market was a sharp contrast to the impressive success it had already achieved in Japan. But after this shaky start, Toyota went on to establish itself slowly but surely in the US market.

The US market was the market of big cars – the Gas Guzzlers as they were called. Compared to these cars, the cars produced by Japanese manufacturers were small in size and fuel efficient. I remember reading somewhere that Japanese like to manufacture cars having rectangular shapes like box. Wagon R could be one such example. Compare this with the stylish, sporty cars sold in US and the early failure of Japanese cars can be reasoned. The oil crisis, however, helped Japanese cars – Toyota mainly, to establish themselves firmly in the Japanese market. Small size, high quality, superior engineering and performance and most importantly affordable price tag made the Japanese cars very popular in US. Even, Iacocca’s autobiography has references of Japanese carmakers and how they made Ford, GM run for their money.

In 1968, Toyota introduced Corolla which became and still is a runaway success. Similarly, Camry introduced in 1983 was another perfect product from Toyota.

Together Eiji and Taiichi went on to build Toyota – a world class automobile manufacturer. Giving dose of its own medicine to Ford, Toyota implemented Ford’s best practices but at the same time made sure that they are customized to Japanese Industry.

Eiji remained the managing director of Toyota from 1950 to 1981 and Chairman from 1981 to 1994. Taiichi rose to become the executive Vice President and is considered Father of the Kanban system.

Today, it manufactures vehicles under the brand names Toyota, Hino, Scion and Lexus, and owns a majority stake in Daihatsu, and 8.7% of Fuji Heavy Industries. In 2005, the company has manufactured 7.5 Million cars that is more than 1 car per minute! At the end of fiscal 2005, Toyota had production bases in 26 overseas countries and regions, a vehicle sales network spanning approximately 170 countries and regions, and more than 260,000 employees worldwide on a consolidated basis. As we all know, Toyota also participates in the F -1 racing.

Apart from being a great company, Toyota has given a lot of new concepts about Management and processes. JIT, Kanban, TQM, Six Sigma, SCM and all the other concepts that are now used by manufacturing companies all over the world are essentially gifts from Toyota!

Watch this space tomorrow to know more about these concepts and Japanese Management.

Regards,
Abhishek

P.S.:
There is a book named “Toyota Way” which I am yet to read. The article is written purely by googling about Toyota.

Konosuke Matsushita

When we think of Electronic gadgets if there is any brand that comes to our mind other than Sony, it’s Panasonic. Today’s Gyan is about yet another Japanese company and its founder who are living example of “never – say – die” and “Think Big” attitude. It is a story of Konosuke Matsushita who lacked formal education, wealth, charisma, connections and even a special talent. Yet, early hardships unleashed hidden strengths which opened Matsushita's mind to the collective wisdom of others. His lifelong thirst for learning fueled the passion that led this humble, shy, 5-foot-5-inch humanitarian idealist to pioneer management practices and advance his philosophy that the mission of a manufacturer is to relieve poverty and create wealth, not only for shareholders, but for the society as well.

Konosuke Matsushita was born on November 27, 1894 in a little village named Wasamura south of Osaka. His father was a small landowner and prominent member of the community, and Konosuke, the youngest of eight children, enjoyed a comfortable early childhood. But during the war between Russia and Japan, the family's fortunes turned when his father lost his property due to bad speculation in the commodities market. Soon, they were forced to leave their farm and move to a small house in the city. Sadly, Konosuke lost his 3 brothers in a flue outbreak, too.

Still only nine years old, Konosuke bid goodbye to his mother at the train station, and left on the long, lonely ride to the big city – Osaka in search of a job.

To help support the family, Konosuke worked as an apprentice to a hibachi (charcoal brazier) store in Osaka a few months before he was to graduate from elementary school.

But soon, even the brazier went out of the business and Konosuke started working in a bicycle shop for 5 more years to come. He wanted to quit the job at the bicycle shop to continue with his education, learning in the night school. But his father convinced him to stay at the bicycle shop, saying, "The skills you are learning will ensure your future. Succeed as an entrepreneur, and you can hire people who have an education." His father speculated absolutely correct this time around.

Konosuke’s instincts told him that Electricity is going to be the next big thing in future. Eager to join this field, he left the bicycle shop and joined Osaka Electric Company at the age of 15. Within years, he was promoted to the post of “Inspector” – the highest any technical person could think of achieving in the company!

In his spare time, Konosuke had come up with a new design for electric sockets. His supervisor didn’t show much interest in it. Dissatisfied by the lack of challenge in his job, Konosuke found his own company in 1917. Along with his brother – in – law Toshio Lew * and two other partners and with a capital of 100 Yen, the company started its operation from a small house in Osaka. After 10 months, the profit was 10 Yen only! The workers and partners left the sinking ship. Even, Konosuke himself was losing faith in him. In those hopeless conditions, a wholesaler came up with an order of 1000 electric plates. Depending upon that work, Konosuke would get a yearly order of 30,000 plates each. But the timelines were steep as Konosuke had to complete the order in a month. Moreover, no one from the company knew how to make them. But Konosuke somehow managed to grab the order! (Gee, the story so far sounded more like a typical Hindi Movie except that our Hero was already married at the age of 20!)

The company soon took off by manufacturing Attachment Plugs, Two Way light Socket. It also came up with electric lamp for bicycles that would last for at least 40 – 50 hours. None of the manufacturers entertained Konosuke because they couldn’t believe that it is possible to manufacture such a long lasting battery. Konosuke then directly marketed his product to the customers. The trick worked and thousands of orders started flowing in. The company was now known as “Matsushita Electric Works” with a turnover of 1.2 Million Yen.

The movie has not yet reached interval! Interval ke baad, there are more ups and downs twist in the story.

The 1929 Great Depression hit Matsushita too. Even Konosuke himself was bedridden due to illness. All the managers came around to see him and advised him to lay off half the people to keep the company afloat. Konosuke outrightly refused to do so and in turn asked the managers to halve the production and make people sell the products in the remaining hours. Again, the trick worked. The company soon managed to spring back to its feet. By 1932, there were 1000 people working in 10 different plants. The company also owned 280 patents for different electric products! By 1937, Matsushita Group comprised of 9 companies.

But the happy days were soon to go away as Japan jumped into the World War II. The government forced Matsushita to convert their plants to manufacture weapons and ammunition. After the fall of Japan in 1945, all the factories came under US Control. General McArthur came down hard on the manufacturing industry, resulting Matsushita losing 60 odd companies in a single go! Even, Konosuke himself was asked to step down, any other man who has lost almost everything would have surely given away to the pressure. But not Konosuke! He in turn convinced the US authorities why it is important to keep the plants running. To prove his point, he penned a 5000 page report and managed to get support from the workers union. Finally, Konosuke was allowed to continue with his company but all his personal estate and property was seized. Moreover, he had taken huge loans for his companies. People dubbed him “The Loan King”!

It took more than 5 years for the company to come back on track.

In 1951, Matsushita happened to visit America. He was totally mesmerized with its prosperity and decided to make his company famous not only in US but also in whole of the world. In July 1952, he started dealing for a joint venture with the Dutch electronic giant “Philips” to manufacture electronic parts. Philips asked for $500,000 + 30% stake in the new company and 6% consultancy charges! Konosuke argued that Matsushita was going to run the company is Japan and hence, deserves some Management Fees! Finally, Philips settled for 4.5% Consultancy Fees and Matsushita for 3% Management Fees. Back then, Philips was bigger than Matsushita but this did not deter Konosuke.

Matsushita went on to establish the famous “Panasonic” brand. The group bought the MCA Company in US at the same time when Sony bought Columbia Pictures. With a productline having popular brands in TVs, Tape Recorders, Cameras, the company’s net sales are over $81 Billion today. The Matsushita group of companies has 628 companies employing 334,752 people.

Konosuke retired officially from Matsushita in 1973 but continued as an advisor till his death in 1989.

Konosuke was as much a philanthropist as businessman. To him, entrepreneurship was a means to earn money so that it can be used to serve the employees and the society. Even while doing business, he always made a point to explain the workers why they are doing what they are doing because according to him, if the workers themselves are not aware of what they are doing, they won’t be able to suggest improvement and contribute to their fullest.

A man who didn’t even receive a formal education left lessons for today’s managers to learn. Sheer hard work, self confidence, entrepreneurship and patriotism drove him to become the proud owner of a group of companies. Somehow, I recollect words wrote on Andrew Carnegie’s grave and I find them apt for Konosuke, too. It goes something like “Here lies a man who knew how to make people work who were smarter than him”

Regards,
Abhishek

*: Toshio Lew went on to found another electronic company “Sanyo” with whom BPL had made a JV.

Made In Japan: Akio Morita and Sony

Listening to songs on my iPod, I always wonder how advanced the technology has grown over the years since the days The Early “Portable” Radio
of Gramophone, to Valve tubed Radios, to transistorized Radios and Cassette players. But, if there is one thing that has truly brought music into your pockets and made it portable for the first time – it’s the Walkman. Today’s Gyan is about one such personality and the company he founded that stands tall as an example of innovation, continuous improvement and the virtue I admire the most – the entrepreneurship. Yes, it’s the “Sony”

Born on 26th January, 1921 Akio Morita belonged to a family who were into the business of brewing “Sake” – an alcoholic drink made using rice – for about 400 years. Sake enjoys the popularity of the national drink of Japan and the families brewing Sake were revered for their profession and the legacy continued through generations. Kyuzaemon – Akio’s father was grooming him well to inherit the family business of Sake brewing and to become the next Kyuzaemon. Although, Akio belonged to this traditional Japanese family, his father had a modern vision. His uncle, especially, played a vital role in making Akio’s perspectives broader towards the western culture.
Akio was interested in Physics and Mathematics. He also enjoyed taking apart electronic gadgets and put them back together. Considering his likings, Akio got admitted in the Physics Department of Osaka Imperial University.

Those were the days of World War II. Japan was fighting a losing battle against the allies on several fronts. After graduation in 1944, Akio joined Navy's Wartime Research Committee. This is where he found Masaru Ibuka.

The nuclear attack on Hiroshima and Nagasaki left a paralyzed and humiliated Japan. The country had no choice but to surrender. Every plant, factory and industry was now either destroyed or was under US control.

Akio returned to his family in Nagoya once the war was over. He was now ready to take up the job of a professor in Tokyo Institute of Technology. This was when he read about the research laboratory founded by Ibuka in Tokyo. Reading the article, Akio met Ibuka and together they founded “Tokyo Tsushin Kogyo Kabushiki Kaisha” (Tokyo Telecommunications Engineering Corporation) on May 7, 1946, with approximately 20 employees and initial capital of 190,000 yen. At that time, Ibuka was 38 years old and Morita was 25.

The “headquarters” of Tokyo Tsushin Kogyo K.K. was in a war struck, dilapidated Departmental store. The main gate was kept closed at night. So the employees would go in and out through the fire escape. Many a times, the police had mistakenly arrested the employees thinking they are burglars!

Morita and Ibuka started selling converters for Radios so that people can listen to Short Wave Bands banned earlier by the Japanese Government. Then they tried their hands at making electrically heated mattresses. But the mattresses used to get so hot that nobody could get a good night’s sleep! After this failed attempt, they tried selling electric cooker which was fairly successful.

The company was soon to see success when in 1949 it developed magnetic recording tape and in 1950 sold the first tape recorder in Japan.

Music had always been passion for Akio. In his childhood, his uncle would bring him records of Beethoven, Bach and young Akio would wonder how to improve their sound quality. Years later, his company started manufacturing Tape Recorders. In 1957, it produced a pocket-sized radio. The company tried making Tape Recorders and Radios as small as possible so that they can fit in the shirt’s pocket. The pocket radio was a little bigger in size than the usual shirt pockets. So they even sold shirts having pockets befitting the radio!
This was when Akio decided to change the name of the company from “Tokyo Tsushin Kogyo Kabushiki Kaisha” (hush!) to “Sony”! Akio wanted to make his company a global organization and he knew that US was their primary market. The current name would not go well in that country. So, deriving from Latin “Sonus” – Sound and “Sonny” – American Slang for “Whiz Kids”, Akio renamed the company to “Sony”, in spite of the opposition from his own employees!

While technical part was Ibuka’s forte, Morita would worry about how to sell the products to the customers and would handle the marketing of the company.

Sony was and still is very keen about the quality of their products. But back then, anything that is made in Japan was considered inferior. So the “Made in Japan” tag would always be in small fonts somewhere at the corner. A custom officer once scolded about this fact and since then, the “Made in Japan” and “Sony” would appear prominently.

Akio Morita always thought big. Once, a US company named Bolova placed a huge order of 100,000 transistors to Sony. But there was a condition that Bolova would sell them with their brand name. It was a major breakthrough for Sony but Akio politely turned down the offer saying he wants to make a World Class company! In another incident, another company asked Akio to quote the prices for 5000, 10000 and 50000 transistors. Morita quoted a discounted price as the quantity went up. But when the customer asked for a 100,000 transistors order, Akio quoted it much higher. On being asked why the price was quoted higher when in fact it should have been less, Akio replied that to provide that much amount of transistors, he would need to set up another factory, hire more people. In Japan, there was no tradition of firing people once the job is done. So, even when the order was completed, Akio couldn’t have fired the extra employees. Hence, to take care of all these factors, Akio had quoted a higher price. The incident truly depicted Akio’s caring nature towards his employees and his respect to the Japanese Management.

Morita explains this basic difference between Japanese companies and their American counterparts. In other countries, they hire people who are already good at one or two things and then depending upon the work, they are used. But in Japan, good people are selected, trained and used to carry out the task. It’s like building wall using stones of different shapes. If you wish to create a wall of different shape, you don’t need to throw away the stones; just rearrange them and they would fit together!

In 1960, Sony produced the first transistor television in the world. 1960 was also the year when Sony Corporation of America was established in the United States. It was soon followed by Sony applying for American Depository Receipts (ADRs) in 1961. Sony was the first Japanese company to be listed in NASDAQ. Morita’s vision not only helped Sony build up the much needed capital but also paved way for other Japanese companies to go global.

In 1968, the company entered the music software business in Japan by establishing CBS/Sony Group Inc. jointly with CBS, Inc. of the U.S. Then in 1979, Sony entered the financial business in Japan with the founding of Sony Prudential Life Insurance Co. Ltd., a 50-50 joint venture with The Prudential Life Insurance Co. of America. Furthermore, Sony acquired CBS Records Inc., the records group of CBS in 1988. The following year, Sony acquired Columbia Pictures Entertainment, Inc., enabling the company to become a comprehensive entertainment company that owns both quality software content and a wealth of hardware.
At Sony, much stress was given on inventing products that couldn’t be imagined by the common man. Walkman* was one such example. Even the people from Sony itself questioned Morita and Ibuka why anyone would like to buy an electronic gadget just to listen to music while doing his work, walking, working out. But, both Morita and Ibuka – well in their sixties by now – were firm on their decision. Sony brought in the Walkman and rest all is history.

Today, Sony is a leading manufacturer of audio, video, communications, and information technology products for the consumer and professional markets. Its music, motion picture, television, computer entertainment, and online businesses make Sony one of the most comprehensive entertainment companies in the world. With the annual sales of approximately $67 Billion in the year ending 2005, Sony employs 151,400 people.
Akio Morita resigned from Sony’s chairmanship in 1994 following a cerebral hemorrhage while playing tennis. In 1999, he – a man who always remained young at heart - died at the age of 78, leaving behind a great legacy of “Thinking Big”, Self Confidence and Patriotism.


Regards,
Abhishek

P.S.
There is an autobiography of Akio Morita titled “Made in Japan: Akio Morita and Sony”

*: Launched on July 1st, 1979, Walkman was the brainchild of both Morita and Ibuka. The Walkman was initially launched as 'Soundabout' in the U.S., 'Stowaway' in England, and 'Freestyle' in Australia but it soon got recognized as “Walkman” throughout the world making its way in the Oxford Dictionary in 1986. The court battle for the patent of Walkman is won by one Andreas Pavel who invented the concept and the first walkman a year or so before Sony. The article appeared in 18th December’s Times of India.