The 10th IILM Distinguished Global Thinker Award

The 10th IILM Distinguished Global Thinker Award

The 10th IILM Distinguished Global Thinker Award was conferred on Prof. Ashish Nanda, an eminent academician and Director, Indian Institute of Management, Ahmedabad. The Award was presented to Prof. Nanda by Mrs. Malvika Rai, Chairperson, IILM.

Prof. Ashish Nanda has a PhD in Business Economics (Harvard), AM in Economics (Harvard), PGDM in Management (IIM Ahmedabad), and B.Tech in Electrical Engineering (IIT Delhi). Prior to his doctoral studies, he worked for five years with the Tata group of companies as Tata Administrative Services officer. A recipient of the Henry B. Arthur Fellowship, the Harvard University Center for Ethics in Professions Fellowship, President of India Gold Medal (twice), and the IIM Director’s Gold Medal, he has published several case studies and Harvard Business Review articles. He taught at the Harvard Business School and Harvard Law School for 20 years and has advised numerous professional services companies.

While accepting the award, Prof. Nanda, expressed his gratitude with generosity of spirit and warmth and thanked IILM for conferring this award.

Welcoming Prof. Nanda, Professor Rakesh Chaudhry, Senior Director IILM, shared that IILM launched the Global Thinker Award in 2006, to celebrate and honor those distinguished individuals who have contributed substantially to the global stream of consciousness, ideas, and knowledge, and have made a significant difference in the national and global community.

In the lecture delivered on ‘Profession of Management’, Prof. Nanda, spoke about management as a profession and explained the meaning of the word profession which means Profess, i.e. “making a claim or commitment to a superordinated goal.” He brought up whether like any other profession- legal, medical and military, the management profession too needs to take a vow to serve their clients’ interests and always keep the clients interest above their own. He emphasized that the necessity to vow is paramount as input and output of the services rendered by the professionals are not verifiable or measurable by their clients.

He wondered if the management can be called as a profession. In his opinion, if management is to be a profession, it needs to have its own association, cognitive base, licensing and code of ethics, which puts the moral obligation on the profession and to achieve super-ordinate goal, social status, respect, pride, attorney for the nature of work done towards their clients. Thus, it becomes imperative for the management professional to take a vow to achieve super ordinate goal that would serve the best interest of his client.

As per Prof. Ashish Nanda, “I am extremely honored by the generosity of the spirit. I just feel that I have had a very fortunate life and opportunities have opened up at various points and it’s been a wonderful journey so far and I hope that it continues to be productive and good journey. I am going to talk on the subject of ‘Profession of Management’. People have often used the term Professional Managers and the term is used very often to distinguish managers from promoters or owners of family business. That’s the way people call it, they say professionalization of firms / professional managers. In casual usage, it is supposed to be people who are in management positions, who are not entrepreneurs or not in family owned business. But if you go to a student in the field of Sociology, he would say that word profession means ‘Sociology of Professions’, so the question here is – Is management truly a profession? Should it be a profession? I am going to say a few words on that. Profession has two kinds – true professions and free professions. True professions are the kinds where actually there is an organization, there are some goals, you take a vow, and these are military organized religion. Free professions are where actually you do take a vow; you also have commitment to something super ordinate goal but you can be in multiple organizations, for example, super ordinate goal a military person commits to is national well-being.

What a professional does is he provides service to those he is serving and the service is very valuable and this service arises out of capabilities these people have developed after years of training and development. So there is a great deal of knowledge that goes into delivery of service. Think of a Heart Surgeon for example, when a heart surgeon is operating, he has worked for years on a body of knowledge and training and the service he is providing to you at that time is extremely valuable. These are the two characteristics that together determine who are professionals. One of the challenges is that the work the professional is doing, it is very difficult for the client to judge the input and the quality of output because both are non-measurable. It is not possible for client to actually make sure that the professional’s interests are aligned with the client’s interests.

What Professionals do is they take a vow to become professionals. In many countries, you do not become a lawyer by just passing LLB, you actually have to join the Bar Council to become a lawyer and part of joining the bar council is to sign a vow so there is something that you profess when you become a lawyer or a doctor or any other profession. Vow has the same characteristics. The vow is I promise to fulfill my client’s interests ahead of my own interests. If your client believes in your vow, then they will trust you to do the best for them. Now, who makes sure that you are actually following your vow, your own fellow practitioners do it.

Another very interesting characteristic of professionals is most professionals have associations for example, bar association, medical association. The reason those associations exist is they promise to society we will make sure that people who join our professions they take the vow and we will monitor ourselves carefully, in return for that promise society gives two very powerful rights – right of self-certification – accountants decide who will become an accountant, lawyers decide who will become a lawyer. Second right they get is one of self-discipline. They themselves decide who has broken the vow and will be punished. So what happens in the profession is Professionals make a promise, society trust them, they have an association which make sure that you hold true to promise and if associations work well, we will give you the autonomy / freedom.

For management to be a profession (many of us say management is a profession), it requires managers to take a vow to do things in the best interest of their clients. This is a challenge – managers will say who is my client, I have stakeholders – customers, employees, owners; theory of multiple stakeholders is applied here. Agency theorists will say that managers exist because owners tell them to run the enterprise on their behalf’s so their clients are the owners. So managers have to take a vow that they will act in the long term interest of the owners. If management is a profession what do managers commit to, what is the super ordinate goal? I think what managers can commit to is efficiency, if we have that spirit in managers then perhaps we can say that managers are professionals. There has to be an association of managers that can evaluate how the managers are doing, whether the resources are being effectively used.

Are we anywhere close to that in Management? Overall my answer is No. For management to claim that we are professionals this is what is required, not just saying that we have MBA degree, we become professionals. If they try to maximize personal returns, it reduces the possibility of becoming professionals. What helps managers being treated as professionals when they are investing for long term returns, building the assets for organization? Second thing that will make a big difference is more and more human capital in intangible assets becomes a part of the equation. So, where do I see this leading, I think technical education in skills of management has made MBA degree very attractive. There will be some institutions which emphasis to their students on their responsibility, try to have them build a sense of commitment to the super ordinate goal. Over a period of time, people coming out these institutions will be able to deliver better results and out of this category the profession of management will emerge.”

Dr. Smitha Girija, Director, IILM, thanked Prof. Nanda and the distinguished guests. The award ceremony closed with the singing of National Anthem.

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