People are the most critical asset in a consulting firm, so you need to put your best person in charge of your people
I believe that men and women come from two different perspectives, and when they both work together, they bring great value
Richard Rekhy, CEO, KPMG India, in conversation with Rajlakshmi Saikia, on his dream to make KPMG the most-envied firm by becoming the clients’ and employees’ first choice
In 2012, KPMG India introduced a unique process of democratic succession planning to ensure that the right CEO from a people and business stand point takes the deserving seat. With this change there is a vote per partner, with no veto power even with the top management ensuring that the appointed CEO of every 4-year term is the best choice of a large majority of at least 75 per cent. Every CEO appointed at KPMG India will have to go through this process. A proposed CEO can either be self-nominated from among the pool of partners or be nominated by a selection panel. The proposed CEO will be expected to fulfill the prerequisites to become a KPMG CEO: someone who inspires trust and has the ability to significantly improve the firm’s performance. Richard Rekhy, the first CEO of KPMG India to be appointed through this process, shares his plans to introduce a culture of ‘Collaborate to Win’ in the firm.
What is your plan for the next 4 years as CEO of KPMG in India?
For me it is very clear – in these 4 years I want to leave behind a legacy. As a leader I want to make a lasting difference - to the business and to the lives of people who work at KPMG. My focus is to drive a collaborative approach to work and that is also my personal goal this year, because I believe in leading by example. While the traditional approach to consulting business is to work in silos, at KPMG we are trying to change that mindset. This collaborative approach also has direct business benefits. We are even encouraging collaboration in revenue flow – this year we have a two-pen approach to Partner evaluation where significant weightage is attributed to the Partner’s collaborative approach.
Social media strategy is also something that I am truly very keen on driving. It is important from all angles: business development, knowledge sharing and employee feedback. From an employee perspective, it will allow us to share our thoughts with them on a platform that they are comfortable with. Today, if we as an organisation are not listening to our people, then we are bound to be in trouble.
A firm such as yours is traditionally more careful on what is discussed outside. Is that changing because of social media?
We are basically an accounting and consulting firm. In India, a major part of our revenue comes from the consulting business and audit is about 22 per cent. We are governed very strictly by our regulations, but whether it is audit, tax or consulting, we cannot overlook client confidentiality, which is sacrosanct. So, we have very strict rules on social media where we tell employees that they cannot speak about clients on social platforms or talk about colleagues in a derogatory manner. We have a very clear policy on what is allowed and what is not on social media. For example, a KPMG employee will not post “I am going to London to do due diligence of XYZ company” on their Facebook page. That is confidential information, so there are such dos and don’ts on the use of social media. But people are encouraged to talk about general situations which are not specifically client-related.
We try our best to keep employees informed of all the dos and don’ts –so they are not caught by surprise. And a lot of this is communicated right at the time when an employee joins the firm. Our plan this year is to focus on devising a new social media strategy and communicate the same across the board. We have also started using apps in our marketing plan – for example, some of our thought leadership and budget publications are being promoted using these apps.
In a people-driven industry, the personal style of leadership is a very important factor for people to align to a common goal – there may be people who do not align to the company’s goal as they move up the hierarchy. How do you manage that?
That is very tough to manage. People join organizations’, but they leave their managers and that’s the truth. If an employee is to live and die with one manager, then it becomes very difficult if that manager becomes autocratic. And you get all sorts of people. We now ensure bad behaviour will not be tolerated irrespective of how good a performer one is. We have asked people to go if they had demonstrated behaviour that was not aligned with our values, even if they were high performers. And we are also rewarding people for demonstrating our values. In fact, we are celebrating 20 years of KPMG in India and we have planned to reward all those who demonstrated values of the organisation over the years.
I have kept something I once heard very close to heart. When I met the CEO of a large consulting firm in New York some time ago, he said something that just stayed with me – “Pick your highest performing business partner and make that person the Head of HR”. People are the most critical asset in a consulting firm, so you need to put your best person in charge of your people. It made absolute sense.
I personally believe that if we care for people the result will be high performance. So, when I became the CEO, I took the opportunity to ask one of our best performing partners – Shalini Pillay - to take on the reins of managing HR and ensure that we give our people the best. I chose her because I wanted someone who was a high performer as well as passionate about people . In fact, I’ve had such a keen interest in people that I had offered myself for this role to my earlier CEO, so that I could make a difference and transform KPMG India to be on of the best places to work. I believe it’s the most critical role, because you would be responsible for the most expensive asset in the business – our people.
In the transformation journey towards creating a culture of ‘Collaborate to Win’, there will be people who are not aligned to what you are trying to do. The transformation may demand that you take few people off the bus. What is your plan to deal with such scenarios?
I believe, all my life I have been a very good judge of people and it only takes me 2 or 3 interactions to know where an individual comes from. I have this uncanny knack of understanding people. I am very honest with them. I never show them something I cannot deliver. I ensure that I tell all new recruits that while this is a great opportunity, it does come with its own challenges. We are honest with people and I have told everyone that the doors of KPMG are big enough for anyone to walk through. So, there will be no compromise on values in the journey.
At Andersen, besides my business role, I was also given the role of overseeing HR in the company and Andersen was not the friendliest place to work in. I personally worked to make it into a people friendly organisation, to a point when our attrition rate fell to almost zero. I had some very difficult conversations with people when we had to ask them to move out, because it is in the interest of the individual and the organisation. There is no personal vendetta. It is not about likes or dislikes, it is about you not standing for the values that the organisation stands for. So, yes, Shalini (our present Head of HR) will also go through these same challenges, but this is in the best interest of the business and so must be done.
While there may be a healthy gender ratio at the entry level in your business, is the same also true as you move up the ladder? What is your diversity strategy?
You are right. At the entry level, our gender ratio is 40 per cent and as you go up, it is a miserable number. There was one time when we had only one women partner in the business. But yes, that has changed and now we have many more partners who are women. The challenge is that the kind of life a consultant leads becomes difficult for women, especially in India where women are expected to work and look after the house as well. So, it is always a challenge for a woman to balance the two. However, the Indian ecosystem offers enough support and many women today realize that and manage to find the right balance. Personally I believe we need to focus on gender inclusion, otherwise we will not be able to keep this great talent that is there in women. I believe that men and women come from two different perspectives, and when they both work together, they bring great value. It makes business sense for us to have a healthy gender ratio. It’s on my priority ‘to-do’ list.