Passion to Win: How Winning Companies Develop and Sustain Competitive Edge

South Asian Journal of Management, Jan-Mar 2006 by Agrawal, Anand, Pai, V S

Passion to Win: How Winning Companies Develop and Sustain Competitive Edge By Abad Ahmad and O P Chopra Excel Books Private Limited, New Delhi, 2004; Pages: 322; Price: Rs. 250; ISBN: 81-7446-389-5.

This book is the product of the efforts of two Delhi University Professors, Abad Ahmad and O P Chopra. Observing the dramatic changes in the list of companies, which could retain their position amongst the list of top 100 companies during the 1990s (1990-2003) in India, the authors were prompted to investigate and determine how some companies sustained their levels of excellence over time.

Using Delphi technique, in consultation with opinion leaders, managers and business leaders, combined with ethnographic type of research, nineteen companies were identified. These companies have apparently demonstrated sustainability in performance growth in the presence of tough competition from MNCs, cheap Chinese goods and domestic / global regulatory frameworks. These were Satyam Computer Services, Wipro, Infosys, Ranbaxy, Dr. Reddy's Laboratories (DRL), Hero Honda, Eicher Motors, Hindustan Lever Limited (HLL), BPL India, Titan, Larsen & Toubro (L&T), Sunadram Fasteners, Motorola, Glaxo-Srm'thkline Beecham, Tata Sons, Reliance, Hindustan Electro-Graphite (HEG), ICICI and Bharat Electronics Limited (BEL).

Four basic parameters to assess the sustainabihty were evaluated for the period 1990-2003: Change in sales turnover, change in profits, change in reserves and surplus, and change in market capitalization. The performance review was done both quantitatively and qualitatively. The result of this study led to development of a framework called '5-I Framework" consisting of five clusters containing key elements that distinguish organizations with sustainable competitiveness.

The authors have listed certain common elements demonstrated by organizations with sustained high performance and competitive edge, and have termed them as 'Purposeful Values driven Enterprises (PVE)'. These elements include Inspiring Leadership, Innovative Strategy, Identity, Implementation Skills and Process Driven Execution, and Internal and External Win-Win Relationships. Though not easy to comprehend fully, Ahmed and Chopra would like us to believe that these characteristics of a winning company are passed on from one generation to another providing a coevolving continuity. The factors, characteristics and processes that distinguish PVEs are explained in detail in the book.

Inspiring Leadership is described as one element that brings about change and challenges the status quo. Nine major characteristics are indicated for inspiring leadership that provides sustainable competitive advantage to the organization. Proactive and Positive Mindset is one listed, which includes enormous self-confidence, the ability to master technology, create good will, and mobilize talent.

Passion and Ambition is another trait mentioned that alludes to the winning companies' ability to think big and behave like a large organization, and that makes a difference. Instances of ambitious growth, like the successful launch of the first Indian motorcycle giving 80 km/litre by Hero Honda in 1985, are described. Another characteristic referred to is Competency Building &L Winning Paradigm.

Clear Mission and Vision is the next trait in line. Ranbaxy's vision to be a research-based international company, Glaxo SmithKline's focus on nutrition, in the view of the authors, are all well articulated and shared organizational purposes in easily understood words. The remaining traits explained are Institution Building and Continued Outstanding Leadership, Openness, Learning and Change, Thorough Knowledge, Attention to Details and Holistic View, People Centric Approach, Empowerment / Team Work, and lastly Simplicity, Values and Character.

Six distinctive orientations related to the second element, Innovative Strategy of outstanding organizations, were found and depicted. Successful companies studied adopted a comprehensive institutionalized system of strategic planning to scan environmental changes, involving large cross-section of people. Hero Honda conducting extensive countrywide research before launching the motorcycle in 1985 was sited as a good case in point.

The ability of successful organizations to sort out the key drivers for growth and profitability was an important dimension of innovative strategy. Such companies move up the value curve by accessing higher level of technology and new or improved products through knowledge inputs based on R&D. This is evident from the planning at Larsen &. Toubro (L&T). It planned to move into 'asset light' businesses requiring lesser capital. These are knowledge driven businesses like embedded software and e-engineering solutions. Joint ventures with foreign companies in these technology areas enabled L&.T to get into the high-end construction like stadiums, airports, etc. and large turnkey projects.

Realization has dawned on the firms studied that innovation may not lie in products alone but across the value chain, like, in distribution. This is evident in Titan using 'World of Titan1 exclusive stores along with stores like Time Zone", which are multi brand top outlets that also display competitive brands. These companies generally followed conservative financial policies to generate and accumulate resources internally for taking new initiatives.