Power: Form, flexibility and force

By Cassandra Mascarenhas

In a knowledge economy, learning becomes a vital ingredient for power and furthering the need for continuous learning, the Chartered Institute of Chartered Accountants’ annual flagship event, the CIMA Business Leaders Summit 2012 conducted the technical sessions, the second half of its two-day agenda.

“Our theme is about power. Power existed even before mankind, an energy that holds the universe to go, makes the world go round. For business leaders, it’s all about power – its form, flexibility and force. We need to draw relevance from nature and the use of power in the hands of mankind. We have seen destruction of humanity, the failure of the able and the triumph of the disabled. It comes down to choice – the choice between saying yes to what is good and no to what is bad. In the end, if power is used constructively, it will do well for mankind,” stated CIMA Regional Director for the Middle East, South Asia and North Africa Bradley Emerson in his opening remarks.

The power of yes

The summit got off to quite an active start with the keynote speaker, International Business Growth Specialist from Singapore Tim Wade deciding to wake up the audience by putting them through a couple of exercises and interacting with some of the members of the audience to drive some salient points from his keynote address home.

Interestingly enough, the audience was then informed that the keynote address itself would be delivered after the break for lunch. Instead President’s Counsel Dr. Harsha Cabral took to the stage to deliver his speech on ‘Power – Use and misuse,’ which defined and delivered on the fine line between the uses and misuses of power.

Fully endorsing what the keynote speaker mentioned about the power of yes, he commenced with a definition of power which he observed overall had very positive connotations. “When you look at the definitions of power, it is all positive and deals with authority, control and governance and talks about having power and strength politically and socially. They all refer to a positive act,” he pointed out.

Cabral went on to say that individual power and group power depends on authority. In the case of an individual, it can be based on things like charisma which is in fact based on the word ‘Christ’.

“A woman’s power is something all men, especially married ones, know about exactly,” he said, to much laughter. “In fact, Hitler was a man who could see a thousand corpses without flinching but his wife could make him cry – that’s what the woman’s power is all about.”

How is power acquired?

Acquisition of power comes by birth, conduct, divine intervention or by sheer luck or faith. “When you say destiny, it’s interesting to note Queen Elizabeth was born into the Royal family and has been queen for 60 long years. On the other hand, Prince Charles although born to the family, has yet to be named king – being born to the family is one thing but it’s fate and destiny that will decide whether you’ll get the position of power or not,” explained the President’s Counsel.

Taking for example the case of Sri Lanka, Cabral stated that the country has a written history of 2,500 years, from the very first king and it’s interesting to pinpoint shift of power from time to time, people to people and place to place. Towards the latter part in recent history from 1505 to 1656, the maritime provinces were controlled by the Portuguese who has a tremendous amount of influence on Sri Lankan names and religion.

For 150 years the Portuguese remained in control, then from the 1600s to the 1700s the Dutch took over until 1796 when the Dutch ceded to the British who took control of the maritime provinces until 1815 when they captured the last king of Kandy and controlled the whole of Ceylon until 1948 when the country gained independence.

“Sri Lanka has a reported history of the power shifts within the country. Even post independence, the country went through many different eras and is now in the Rajapaksa era. With the shifting of power from places and kings, maybe the younger generation will see the kingdom of Hambantota but this too will change. Power always shifts from place to place – it’s not permanent,” said Cabraal.

This also applies in the global context and Cabraal drew upon the examples of the Greek and Roman empires to drive his point home. It is fascinating to know about these power shifts. “If you look at the past and power, the Greek empire and the Roman empire; both had absolute power but where are they now. Greece is broke and Spain is almost broke as is Italy. Power shifts all the time and this is something all should keep in mind.”

State power, again taking Sri Lanka as an example, is most seen in the country’s constitution. In Sri Lanka, these powers have been enshrined in the country’s constitution. The separation of powers are also clearly demarcated – the government and cabinet, legislature and judiciary – but the flow together in one constitution.

What exactly is the power of the corporate?

The corporate statute, articles of association and the particular statutes are clearly set out in the document itself, stated Cabral. “All your actions should be within your powers. Even if a public corporation exceeds the power set out in the statute, it can be liable to a writ of provision etc.”

“The directors of a company have control over the day-to-day activities of the company which the shareholders do not have a say in. The directors alone are responsible for the management of the company except for those matters set aside for the shareholders’ meeting. Shareholders don’t run companies – they appoint a board of directors to run a company,” he explained.

Which powers can be delegated and cannot? Ultimately it is the board that is responsible for exercising the powers of the company with demarcations. The optimum use of power for the corporate sector is set out carefully in the company statute. It is spelt out that the directors must act in good faith and in the best interests of the company and that is one of the most important guidelines given in terms of their power, stressed Cabral.

Furthermore the articles of association set out what their powers are and sets out the standard of care. These sections are clearly placed in the statute so that corporates know what their powers and limitations are.

“You would see that in the recent past we have seen the collapses of certain companies even with 106 sections that attract criminal liability for directors. A board of directors should know what exactly what the boundaries are. Unfortunately, most of these provisions haven’t been tested yet but the best case for this would be the Golden Key scenario where the misuse of power in the corporate power was blatantly flouted,” he said.

The power of attitude

Up next was US Author and Executive Educator Susan Bloch who delivered an address on the power of attitude as it defines so many aspects of our lives. “Attitude – whether implicit or explicit is a powerful driver of behaviour. An attitude often overrides facts and logic and can dominate problem solving and decision-making thus impacting strategic planning and implementation,” she stated.

“Attitudes can be changed or modified –and there is a strong correlation between attitude and effectiveness. The power of attitude can enhance or limit not only our own, but the performance of others, and the organisations in which we work.”

She explained that the central theme is that attitude is a powerful determiner of behaviour, more powerful probably, than most logical, educated leaders are prepared to acknowledge. Attitude remains dominant when people make all sorts of decisions – including about whom they hire and whom they promote. Importantly, she pointed out, attitude is contagious.

“Your attitude might kick off a chain reaction and influence not only the attitude of the people with whom you work, but also impact your personal life – your relationships with your children, spouses, and friends. Our attitude is something we ourselves as individuals and teams need to understand and be aware of. Once we recognise that and become aware of our attitude, we have a choice,” Bloch stressed.

She noted that in the end, everyone will be judged by performance – individual, team and business. “Science of insight can help us acquire an attitude that promotes success. We can train ourselves to change, and reframe an attitude, if we work at it hard enough. Self-awareness sets us free. By consciously choosing an attitude where staff can thrive, every leader can sustain competitive advantage.”

Power of brand

Exploring a topic quite different to the ones tackled by the previous speakers, Nokia India Director – Retail Kannan Gopalakrishnan delivered a presentation on the power of a brand: the concept of brand, strategy vs. execution and brand extensions.

Branding actually started with literal branding, Gopalakrishnan commented. “They would put a hot iron to the cattle – branding started with trying to identifying your cattle from someone else’s. A lot of things that you did to your product became your branding and over a period of time.”

Brand is not just about a logo, he stressed, but it’s about everything you do. It’s not just what you do once, it’s about what you do repeatedly. How you react in good times and in bad reflects in your brand and this is how you build up your brand over a period of time, he stated.

“A lot of companies take their brands for granted and have not changed with the times. Very successful brands eventually get into trouble because they try to protect their businesses and take their brand name for granted. Recently, you find lot more technology brands coming into play when surveying the world’s strongest brands,” Gopalakrishnan observed.

Again, in the earlier days commodities were a bigger player by producing more and distributing widely but today that doesn’t mean you’ll have a bigger company – it depends on whether the consumer wants to product or service or not.

He then took Nike as an example of a consumer-centric brand, while pointing out that there are no brands without consumers and that business comes about when the consumer and brands get together. It is often difficult for brands to be relevant to everybody, he added, except for a few examples like Coca-Cola to the extent where a lot of brands today think that for successful brands to exist, you should be not so appealing to a certain segment as well although this may sounds somewhat elitist. Brands like Apple would come to mind, especially in the earlier stages.

Differentiation should not be done for the the sake of differentiation, Gopalakrishnan wraned. It needs to be relevant to the consumer. Most often when you research with consumers, they talk about what they already know and see and if you’re talking about something that’s already out there in the market, it’s not new. “While I’m not saying consumer research is not important there is only so much you can do with it.”

“Segmentation goes hand in hand with differentiation. Companies like Unilever do that with multiple brands so you’ve got different brands in the same product category taking care of the different segments. You will have different segments reacting and responding to your brand differently and you need to capitalise on that.” He also noted that a lot of sports brands are now moving into fashion and older brands like Adidas are considered to be quite fashionable.

“You very rarely find a successful company that has a strategy document with a premium approach and then goes in a completely different direction. I really think that the difference with successful companies and successful brands is that it’s not about their strategy but their execution. In times of difficulty it becomes very difficult to align the entire organisation to a strategy especially if you are not very familiar with said strategy,” he said.

Finally, every brand wants to extend and grow in order to get more from their brand. Gopalakrishnan used the example of Ponds to show how that could fail, stating that many years ago Ponds launched a toothpaste in India and at that point in time it was a very successful skincare product and its association with skincare was so strong no one wanted to use the toothpaste and it was a huge failure.

For a lot of the successes you hear, there are a lot of failures as well but it’s important to keep trying, he urged.“The anomaly about extensions is that the stronger the brand, the harder it is to extend. It’s important to build a brand and start forming germs of an extension in order to get the most out of that brand.”

Panel discussion

With a couple of minutes left before a break for lunch, a quick interactive panel discussion was held with the three speakers for the morning.

Q: There are many budding leaders here in Sri Lanka – what is the attitude you think they should strive to achieve?

Gopalakrishnan: You are talking about touching $3000 dollars per capita income in Sri Lanka and that’s a sweet spot for consumption. A lot of countries have grown looking at exports and balanced that with their domestic consumption and I believe that Sri Lanka can balance that growth as its exports are strong.

I think going back to brands, it’s a fantastic time for Sri Lankan companies to focus and build up their brands as there is going to be a lot of consumer orientation here and there will be a lot of foreign brands coming in so it’s a great time to build up the local brands. Companies need to grab the consumption in the market and fight whatever competition from the foreign brands.

Cabral: I fully agree that you need a positive attitude. What is lacking in the younger professionals is a positive attitude. Gone are the days that you need to be someone’s son to climb up the ladder so it’s up to you and you need to decide that you are not going to be second to anyone. Qualifications alone won’t take you anywhere – you need that correct attitude. People have so many qualifications nowadays. No one else will market you, you need to market yourself.

Bloch: I’d like to focus on the older people because I think as older people keep thinking they know everything and can’t change. My hope for all of us here is that we realise that we have to carry on learning and changing – this is the most difficult part of our own personal growth. If we don’t do this we will stagnate and be left behind. The older people are the role models for the younger generation after all.

I urge the younger generation to remember that they are privileged to live in a world with huge opportunities so don’t hold yourself back. In the West, a problem is that a lot of students have studied philosophy and history which is not what employers want. The opportunities are there for all you and I urge all of you to make the most of it. Women are lucky to live in a world with a lot of opportunities for them and so make the most of it.

Yes and no

After a quick break for lunch, the keynote speaker of the summit, International Business Growth Specialist from Singapore Tim Wade appeared onstage once again to speak on the power of yes.

There is great power in the word ‘yes,’ he stated. It means we agree, we commit, we accept, we will, we can. Yet many people fail to try to take the action necessary to produce a positive and beneficial result because they believe that they cannot do it. Wade explained that when one convinces himself that he cannot take such action, he is creating three key obstacles to his progress.

“First, we expend resources to defend our position. We may use our resources only to gather such evidence and defend our belief rather than investing them in seeking options to move forward. Second, we de-motivate others. When people propose ideas and solutions and we say no and these people will then either not bother any more, or they will leave to seek a leader more likely to invest in their value and contribution. Third, we destroy our self-esteem,” he listed out.

The ramifications are that people end up cultivating and reinforcing a negative mindset. This obscures the innovation, creativity and risk associated with, and required for, accelerating positive growth. The result of this in business: organisations that are preoccupied with staying where they are, that eventually others overtake them and their market value deteriorates or even vanishes.

He emphasised the importance of noting the power of a positive ‘no,’ where it is used as a worthy defence against distraction, de-motivation or destruction. Positive change is positively linked to positive motivation. Change is simply moving from a current reality to a future result. Positive change defines the future result or even just the process of change as being positive.

“Change requires action. Action is a force, and in this case it is a force applied by a human being. However, adults have an extra inertia that can sometimes require addition external force to overcome, to get them started and to keep them going. Usually leaders use fear or motivation but motivation has more positive consequences. Once there is momentum, less external force is required, but a regular dose of motivation maintains velocity or can increase acceleration,” Wade explained.

However, according to him, the positive force of a human being comes from six other factors that also incorporate aspects of motivation namely saying yes to positive goal accountability, yes to positive work-life balance, yes to positive risk orientation, yes to positive possibility thinking, yes to positive framing of past experience and yes to positive action.

Moving on to the aspect of motivation, he defined the term as the desire or willingness of someone to do something or their reasons for acting or behaving in a particular way - their motive for action. Therefore peoples’ role as motivators of themselves or others is to help them define and align these reasons and to increase their desire and willingness to take action.

“We need motivation and as leaders we need to motivate others and help them motivate themselves. A great deal of my convention and corporate seminar work is from leading organisations who are looking for a professional motivational speaker to impact-fully inspire their audience into committing to taking greater levels of positive action,” Wade said.

Unsurprisingly, he added, this is usually linked to an event which is celebrating a significant success and wanting to continue such performance levels, or to events that are highlighting significant corporate targets, opportunities, uncertainties or changes to their people. In all these situations, the desired outcome is an increase in positive action that contributes to the growth of employee, client, partner and community results.

“We are creatures of habit and habits become habits because they are reinforced. That means we need to reinforce positive behaviour by rewarding it with something that the person values. If the person values attention and they receive lots of attention for doing things wrong, we are inadvertently reinforcing that negative behaviour. Reward even small positive actions toward positive change. Incorporate positive acknowledgement and positive reward when the effort is made.”

Power of entrepreneurship

With the ever-increasing call for entrepreneurship, one of Sri Lanka’s own successful entrepreneurs Laugfs Holdings Chairman W. K. H. Wegapitiya addressed the audience on the power of entrepreneurship and shared with them some insights he has gleaned from his own experiences.

“One is born with every talent, with a brain that can be trained to do anything. Although an average person may generally use only 15 per cent of the brain capacity nature gifts them with. Any normal newborn carries the essential input required to reach the maximum potential as a human being. The different environments a person is exposed to, from childhood plays a major role in defining and producing different individuals at latter stages,” he said.

He noted that people say that the son of a singer may sing alike his father. Is this due to genes or is it from the child’s exposure to music, Wegapitiya questioned. From early childhood, a singer’s child may have a greater exposure to music, singing and continued practice of art, which would stimulate his brain thus resulting in him singing alike or nearly good as the parent. The same can be said about the children of parents engaged in other professions.

A harsh environment and the inescapable challenges one may face in life are factors that compel a person to sustain outside his comfort zone and he would strain his brain to find solutions to the problems he may come face to face with, he explained.

Hunger is one elementary need that the human kind was challenged with and was the driving force behind very human creativity. The urge to satisfy hunger of the growing numbers in early human civilisations led the two legged animal to create and discover means of survival which was not an option to take but a compulsion to attempt.

“Today, it is the challenges and the inadequacies in terms of unfulfilled needs that drive human achievement. Given the harsh experiences one may face in life and the stimulating exposures, one gains the urge and an undying need to work for and achieve what he believes in, no matter how impossible they may seem. A human brain can be trained to do anything – the attitude drives a person,” he stated strongly.

Wegapitiya went on to say that all knowledge, skills and competence are within attainable boundaries of any individual. The intuitive abilities with which a human is able to connect to the nature, the power of believing in ones abilities and cultivating the art of training oneself to acquire any skill, knowledge or competence to face any challenge, is the formula that can spark the creation of a successful entrepreneur.

How can a person awaken his natural instincts and how can a person develop a personality with an undying determination to succeed, he asked. “Everyone is born with the raw material. Producing the best out of oneself is nothing but an art of one can learn from his life. Let that be a lifetime, exercise and make use of the potential, which would otherwise be wasted. Your potential is not decided by what you are, but by what you do.”

Power of sustainability

PFI & Associates Singapore Managing Director Peter Fleming tackled the issue of sustainability and very simply defined the term as being about ‘here today, here tomorrow’.

“Sustainability is often mixed up in business and academics with ethics, governance, CSR, green-ism and other fluffy stuff that run alongside the business and given a much lower priority than most organisations’ over-riding goal: the quarterly results. Certainly any organisation having a position called ‘executive VP in charge of sustainability’ has totally missed the point,” he commented.

Fleming noted that people need to have business sustainability at the top of mindshare at least when making any major decision. Every time something is on a meeting agenda for discussion, someone, ideally the most senior person, better asking if this will impact positively or negatively on the sustainability of the organisation’s mission.

Sustainability is also a priority when a BOD assesses the performance of the CEO. Previously unthinkable bankruptcies have shaken the world and multi-billion dollar companies have fallen almost overnight. Plenty of behavioural lapses by a few people at the top in those cases no doubt, but where were the overseers, he questioned.

It is also important when employees look for a job. Unless a business has been getting a lot of negative publicity, sustainability isn’t high on an employee’s list of important factors to consider.

“Strange isn’t it that when the company’s shares tumble and layoffs begin, these are the very same people who are most shocked and outraged? In the 21st century where change is the only constant and time cycles are collapsing, for business leaders and CFOs there can be no more pressing matter than that of sustainability management,” Fleming said.

Power of execution

The final speaker of the summit, Solbridge International School of Business, Republic of Korea Associate Dean Professor Rao Kowtha spoke on the power of execution in today’s rapidly changing environment and started off by saying there is one word characterises the current age of business and that is speed.

“Even as the world begins its faltering recovery from a deep financial crisis, entrepreneurs and established firms all over continue to introduce innovations at a breakneck speed. Technologies and ideas seem to have an increasingly shorter life cycle with disruptions taking place every few quarters rather than decades,” he said.

Kowtha observed that a more interesting trend is the merging or convergence of distinct industries into a single industry as in the case of infotainment, creating new industries while imperilling others. While all this bodes well for the future, it has also created confusion and despair for many. An example of this is the newspaper industry in the West ever searching for ways of survival in the face of public domain information onslaught.

“Firms which can cope with the demands of rapid innovation, speeding up time to market for products, and speedy execution of plans will emerge as the winners. In a nutshell, businesses need to focus on execution of their ideas and not just on ideas. Yet, that would be an oversimplification. Firms need to understand the underlying factors that are causing the rapid changes, and accordingly act. Else, haste not speed will be the result,” he stated.

Three trends drive business in the high gear today and will continue to do so in the future and these are globalisation, the compression of time and the convergence of technologies.

Kowtha felt that what have not been fully appreciated are the subtler yet far-reaching consequences of globalisation. Globalisation not only opens up markets but also is instrumental is extending the company’s reach and reputation. Globalisation also renders the environment more complex, the firm increasingly captive to several pressures and throws up competition in places where there was none. Importantly, globalisation also has made time a defining factor in competition.

It also means the emergence of global standards which sits well with the convergence of technologies. Firms which have realised these simple truths have leveraged that knowledge to build up brand equity on a global scale, to truly globalise their structures and systems, to extend their reach into the market for ideas, and to build up critical competencies for

“Leaders must show a resolve to realise their vision for the firm against the odds and the naysayers. For this to happen, vision must be accompanied by an action plan, and the leader needs to steadfastly adhere to the overall plan in the face of initial disappointments and setbacks. Good leaders should have their heads in the clouds but their feet are firmly planted on the ground,” he said.

He pointed out that many leaders promulgate grand visions but few do the necessary to follow through with the promise. A bold vision signals risk-taking, sometimes putting investors and industry watchers on the edge. Therefore, the vision must be backed up with resources and capability building.

It is also important to provide strong leadership, Kowtha added as an effective leader knows where and when to depart from traditions and to share power and when power should be used to direct the firm. Decentralisation is a form of power sharing but it need not mean consensus building on every issue.  Key strategic decisions should be reserved by the top leadership, albeit in consultation with important stakeholders. Equally important is the consistency of word and deed. Visions and promises ring hollow if actions are not consistent with those dreams.  Kowtha then emphasised on the importance of collaborating with your most feared competitors and learning from them. It is also necessary to create a culture that is always on the edge, always anticipating a crisis and creating one when there is none, so that everyone stays ahead of the curve. He observed that this paranoia probably will equally well serve any firm anywhere in this age of continuous change, as long as the employees share the vision and trust the leader to do the right thing. High performing firms excel in the acceleration of innovation.  – Pix by Upul Abayasekara