India Inc has witnessed a paradigm shift in management competency post Covid 19. It presented a host of unforeseen challenges and left organisations scurrying for cover. The pandemic called for measures that most were unprepared for and had to quickly shift gears to prevail in an unprecedented business environment. Innovation and technology, coupled with resilience paved the way for enterprises to survive and sustain.
As industries adapt to the new normal, a certain sense of optimism has prevailed within the ranks. The 2022 study of management capability of Indian enterprises by All India Management Association (AIMA) and KPMG has produced a higher overall score compared to the previous edition of the study in 2018. This year's overall Management Capability Development Index (MCDI) score stands at 74.5 compared to 71.6 in 2018.
There has been a marked improvement in this year’s MCDI score, which augurs well for organisations considering what the world went through in the past two years due to COVID 19 pandemic. This period was arguably the most challenging for leaders, demanding them to demonstrate the highest level of efficiency and management capabilities. Perseverance was the hallmark for India Inc in these uncertain times and they have done a commendable job of staying afloat and pushing towards growth. However, the MCDI score has varied over the past ten years and as compared to 77.8 in 2011, the current rating has dipped considerably.
The report has brought forward an interesting finding which indicates that women executives have more confidence in their organization's management capabilities than men. In the organizations’ context this augurs well from the perspective that companies are consciously looking to empower the female workforce. Gaining their trust makes the efforts on gender diversity worthwhile. However, this is not an analysis of gender-based efficiency or competency but rather an effort to understand the changing dynamics of management in the past decade.
A look at the last five reports since 2011 indicates that ‘Integrity and Corporate Governance’ is an area that leadership teams across organisations have displayed maximum confidence. This reflects companies’ strong value system and process driven approach, which are instrumental for sustained growth. Another aspect that leaders felt confident was focus on getting results. This underlines the approach of India Inc and is representative of the success that Indian companies have achieved in the past decade or so. With an eye on governance, the result driven approach has been pivotal in making teams understand that results are of paramount importance.
Two areas that business leaders have least confidence are ‘People leadership’ and ‘Organisational capability’. People leadership forms the very core of human capital management and is the functional backbone of every onganisation. It is imperative that leaders and organisations take into account the changing dynamics of employee behaviour and focus on certain critical areas for seamless functioning and sustained growth. In the current context areas such as mental health and wellness, work life balance, growth and transparency are of prime significance. The onus lies on the organisations and leadership teams to create an environment that is conducive to productivity but also lays emphasis on overall wellness and a deep sense of belonging. Initiatives like counselling, specific wellness programmes and training for upskilling and honing new skills could go a long way in building confidence within organisations.
Organisational Capability is one of the key driving forces for an organization to gain competitive advantage. Participants believe that not many organisations demonstrate strong commitment to continuous learning for both individuals and the organisation. These are unprecedented times and leaders must come into terms and find ways to build a robust eco-system that fosters cross functional synergies with effective application of best management practices to achieve organisational goals and objectives.
In an era, which is increasingly driven by technology and innovation, it was surprising to note that the study showed a lack of substantial score upgrades in the areas of application of technology and knowledge as well as innovation and adaptability. This is an area that organisations must step up and fast track the adoption of technology and invest in innovation and learning.
Overall, there has been an improvement in this year’s MCDI score has registered a sizeable growth. Considering the past two years were marred by the pandemic and businesses in many sectors incurred heavy loss, India Inc must take this betterment in management capability as a major boost. The industry managed to navigate through the most turbulent period and from hereon, it can only benefit from the learnings and build a strong roadmap for sustainable growth
(The author is President, All India Management Association & Chairman Cavinkare)