May 21, 2008

About Ram Charan and his consulting advice

Regular readers would know I am a big Ram Charan fan, so I loved this article about him on the CNN site. Some interesting vignettes:

Charan's weird and wonderful life is an unintended byproduct of dedication, he insists. Dedication to learning and teaching and service, to the whole set of Hindu virtues embodied by one of Charan's favorite phrases, "Purpose before self." "People used to ask me, What is your ambition?" says Charan, who turned 67 this past Christmas. "I say I have none. My dedication is going to take me where I'm going to be."

"A leader who does not produce leaders is not a great leader," he says. "If you agree, I'd like to put that in." (Gomber nods.) Charan is trying to help Emaar construct a document that will help its managers discern in others what he calls "natural talents," or "God's gifts." "Each of us has to be the best calibrator of natural talent of the people who work with us," he says. "What are the three to five most crucial natural-talent items that each person has? It has to be specific" - he taps the whiteboard for emphasis - "and very clear" - tap - "and repeatable" -tap!

He remembers when he was 7 years old in 1947, watching from the roof of his home as flames destroyed the cloth shop belonging to his father and uncle. After the fire the brothers started over with a shoe shop. Charan was in the shop every morning before school to help open and every afternoon after school until closing. He counted the rupees in the till at the end of the day, inspiring a lifelong appreciation for the "blood" of business. ("Any company I go to, the first thing I check is cash. How's your cash? Where's your cash flow? No blood, you got a problem right away.")

Charan never excelled at the academic research that leads to tenure at a top-tier school. He was interested more in cause and effect than statistical correlation. His aims were practical: How can I solve this problem? How can I help this person? This company? He began taking on more and more consulting gigs. Most B-school professors consult on the side; in Charan's case, it was his calling.

What defines his career, even more than the quality of his client roster, is its stability. This is his 37th year working for GE, his 33rd for DuPont. He worked with John Snow for 15 years before Snow left

His method is no method. He is wary of abstraction and belongs to no school of management theory. "Converting highfalutin ideas to the specifics of the company and the leader - that's the trick," he once confided to me in an elevator. "The other part is working backward to define what the need is, and then searching for what helps. Then you bring it to common sense, and common sense is very uncommon."

Charan brings observation, curiosity, and care. He lets his clients decide how to use him. Sometimes all he does is ask the right question. "I remember the first time he came to see me," says Caperton. "We were driving to the airport in Charleston, W.Va., and he said to me, 'Why are you trying to grow this thing so fast?' I was sort of shocked by the question. Three weeks later my financial guy came to me and said, 'We don't have money to meet payroll.' Charan realized we were growing too fast, that's why he asked me that question. That was a much better way to teach me, wasn't it?"

"Charan really pushed me on the whole business-partnership piece," Conaty recalls, meaning no more HR initiatives for HR's sake, "and the function as a result is much more credible and visible in GE today than it was."

"I knew what I wanted to do," says Reed, "but I wasn't 100% sure how to get it done. That's a big distinction if you're in business. A lot of consultants come in to tell you what you should be doing. This was not that. This was a question of how best to get it done."

Reed says, "Ram is a catalyst in the real sense of that word. He facilitates things happening but doesn't take part in them himself. And he is an immense source of energy. When you're trying to get large organizations to do things, energy is extremely important. He forces you to tell him what it is you want to do, and he forces you to really be clear in your own mind what those things are and what steps have to be taken. Often it's getting the wrong guy out of a job. But the point is, he starts out by basically forcing you to think with him and be very clear. Then, okay, you notice that he isn't doing anything, he's just forcing you to do it. Then once you've agreed on everything you want to do, he calls you up every ten minutes and asks why haven't you done it yet."

"I'm a lucky man!" Charan likes to say. "I am allowed to do what I love to do!" While I still don't really understand him, I am beginning to believe him. Surely there are many ways to live fully and be happy on this earth; probably, he has found his own.