A Glimpse Into Factual Success Mantras Of Business

 

 

 

 

On May 21, 2024 a resolution was passed during an Extraordinary General Meeting where the shareholders approved the voluntary liquidation and dissolution of a Company. For me it was a moment of heavy disappointment, several emotions ran through my mind and I went into a stage of deep reflection. I felt thus as I was the one who was key in the company’s revival in 2002, after taking on the job as General Manager of the distressed company in mid-2000, and subsequently moved out of the company in Dec 2004. And now, I was reading about the company that I had once revived is no longer existing. I had chosen to leave the company in Dec 2004 as my family chose to migrate to Canada and settle in Calgary. At that stage, it was considered as one of the top performing organisations in the country, with a stellar reputation, solid order book, and a very promising share price. Within a couple of years of my departure news started trickling that the company had started to falter, and it went through a series of change of leaderships, control was later taken over by the banks, and ultimately, the company bit the dust and the afore-stated resolution was passed during the EGM. It is very sad to see an organisation, once revived to be so healthy and prosperous, now going extinct.

 

In this article I will strive to state, more like a case study, of the vital events that happened that could have been major contributors to the sinusoidal life cycle of this company, where it hit a low in 1999/2000, saw a sharp upswing, breaking through the zero X-axis in 2002, hitting an all-time high in profitability in 2004/ 2005, and the gradual decline thereafter to ultimately declare insolvency in 2024. In the country of its existence, declaration of insolvency of a public listed company is considered as a very sensitive event. It’s not a pure commercial decision like the invocation of an equivalent of Chapter 11 of the USA Code that allows time to the company to reorganise its finances and continue to do business should it choose to. In the case I refer to, the Board took the resolution to drive the final nail in the coffin of the company. The company is now officially non-existent, and now the website does not show up. The funds of the investors are lost, and am certain, that the family that was behind the set-up of the company must also be bearing the social brunt of this closure. Lets back up to early 2000, when I was working in Dubai as the regional head of projects, and was responsible for execution of major construction projects in the Middle East, all in the Oil and Gas sector. It seems that I had developed a strong reputation in the region, as being a person who could lead projects out of the pits and put them back on track, and also develop stronger teams with systems and processes to support its profitability.

 

I was quite unaware of this, as I was just doing my job. One fine day I was approached by a known contact, who said that a top position was open in the neighbouring country, and I should look at the option. Cutting to the chase, I was soon sitting across the Group Executive Director who laid out the details and how I could come in as the General Manager and lead the publicly traded company. The term “General Manager” derives various connotations in the reader’s mind, and to clarify, in that country the GM was the top boss who was the CEO equivalent in other countries. I was told that the Group is financially sound, and they want to make a change to replace the existing GM of this Strategic Business Unit which was the largest unit of the group. The SBU had recently gone public thus formed as an independent company, a couple of years prior to 2000. The incumbent GM was not of the competency to take it forward. The owners had good growth plans in mind and wanted me to take over the reins, with full independence and authority. I had been very candid about these two elements as I did not want to be “driven” but wanted to be a “driver” of the organisation.

 

The gentleman (Group ED) was very convincing in nature, and he was clever enough to show me the grand opportunity, but underplayed the mess the company was in. I stepped on board in mid-2000 and was extremely well received, the owners, two brothers who were citizens of the country, and the Group ED, an expatriate, made me feel very welcome. I should clarify that I was advised that there would be a transition period when the incumbent GM would gradually transfer the functions to me, but I had insisted that this would not be acceptable to me. The transition would have to be immediate, and the incumbent would not have any role to play after I would step in. It maybe stemmed from the fear in their minds if I would be able to lead the company. My predecessor was the one who had initiated this business stream for the owners a decade and some years ago, and now the stage had come that they realised the need for “professionals” to manage it. When the countries in Middle East started seeing the wealth of oil coming into their economies, development of projects and infrastructure, including housing, witnessed a major boom in demand. The local citizens saw good business opportunities and as they themselves lacked the knowledge of developing projects, they detailed their “trusted” expatriate employees to become entrepreneurs under their sponsorships and employment, and titled them as General Manager.

 

Many of such expatriates employees did very well in setting up profitable businesses but only a few of them had the bandwidth to develop organisations that could grow from minor/ small enterprises to medium and eventually into mega enterprises. The organization that hired me also saw the same limitation within their incumbent General Manager. Hence the Group Executive Director set out to look for a replacement. In addition there were some other issues primarily related to the gentleman’s professional and commercial ethics. (To be continued) (The author is an Adjunct Faculty at Indian Institute of Management-Nagpur in the area of Production & Operations Management. He has been appointed as Professor of Practice following his extensive experience of working around the globe, holding top management positions in Fortune 500 MNCs. He can be reached at rajeevagg@gmail.com) n