How Cyrus Mistry is implementing change @Tata Group
Change is necessary because senior leaders want people with similar mindsets so that their thoughts may percolate deep down into the system
There have been some changes on top management levels in the Tata Group—latest being the news of Satish Pradhan’s exit. Whether these are a part of Cyrus Mistry’s attempt to make some changes or a matter of chance, leaders can surely draw some lessons from the way these have been implemented:
The news that Satish Pradhan, Executive Vice President of group HR at Tata Sons will step down in April 2013, is being seen as an indication of some major shuffling at senior levels within the group.
Though there is no official statement on the reason behind Pradhan’s impending exit, still, it is seen in the light of ‘changes’ that Mistry had indicated about in his first letter addressed to the Tata employees. Tata Sons has maintained that Pradhan will continue to work with the group in a consulting/advisory role, and that he has stepped down to pursue academic, environment and social causes (as reported by the Economic Times). Whatever the reason may be, entry or exit at senior level can send employees in a tizzy. With every change at the top management some changes in staff are bound to happen; it is essential to do it the right way to save employees from getting panicky or uncertain about it. Here is how Cyrus Mistry did it right:
1. The first major step was hiring, not firing:
Changes come as a part and parcel when someone new comes in at an influential position. In a way, such changes are necessary because senior leaders want people with similar mindsets so that their thoughts may percolate deep down into the system. A change in senior leadership –as long as it is done positively and with an objective to benefit the organization and its people—isn’t wrong. Mistry might also be willing to make some changes in order to open window for some new ideas to flow in and some innovations to happen. What matters is that he did it right! The first change in staff happened not because someone was shown the door, or demoted, or promoted (but moved to some remote location), but because someone who had worked with the group for a long time was hired with new responsibilities and on a new position. Cyrus Mistry—who succeeded Ratan Tata as the group’s CEO-- appointed Mukund Rajan as the Group Spokesperson and Brand Custodian in February. Rajan was ex-Managing Director of Tata Teleservices (Maharashtra) Ltd.
2. Parting ways amicably:
Even though all sort of speculations are rife about Pradhan’s exit, in a statement Tata Sons has categorically mentioned that he will keep working with the group as a consultant and advisor. Whether Pradhan is leaving on will or as a part of some changes happening in the group, this is a win-win decision. Accepting the logic that Pradhan is stepping down to be able to concentrate on his interest areas, the step of offering him an advisory role will help the organization benefit with his years of experience with the Tata Group and help his successor settle down. Even if Pradhan’s exit was a pre-planned decision, his being a part of the organization will help the organization in keeping employee anxiety at bay besides benefiting from experience and knowledge that such older employees have.
3. Informing people about changes that might happen:
When Cyrus Mistry wrote his first address letter (article hyperlink) to his employees not only did he praised his predecessor Ratan Tata, he comforted his employees by indicating that a few changes may happen but they will not affect the value set and ethics that the organization has been rooting for. Such steps have two pronged benefits: one, they prepare employees for some impending changes; two, they reduce the anxiety among employees by comforting them that the things will not be turned upside-down.