Ulaganath Madan-final (1)

ULAGANATH MADAN Ulaganath Madan was born in Madras on 1st January, 1937. His father was at that time Technical Adviser to the South Indian Cocoanut Crushers’ Association and later retired as the Secretary of that body. Ulaganath spent his early years at the Madras Christian Mission School and was an outstanding student up to the time he left for Delhi in the 8 th Standard. A temporary setback in scholastic brilliance ensured. His father sent him to a Public School in the U P Terrai Region for his last two years, Ulaganath stood 2 nd in India for the Senior Cambridge Examination conducted in Dec. 1953. He stood first in Bombay University in 1956 and was awarded the degree B.A. (Hons.) in Economics.

He represented his College, Wilson College in football and

played for the University Cricket XI. He was also Secretary of the College Debate Society. Being the only child of his parents he was dependant on his father’s advice in a choice of career.

Madan (Sr.) was very keen that his son joins a reputed foreign

company and instructed his son to apply to several of them. Ulaganath would have preferred to continue his studies. His flair in debating, his consummate skill behind the rostrum led him to believe that he would succeed very well in the legal profession. Deferring to his father’s wishes, he decided to follow up his applications to the various companies and left for Calcutta, where he could stay with his maternal uncle. Shortly after arriving in Calcutta in July 1958, his attempts proved successful. He was offered a Management Trainee position by a leading conglomerate whose activities varied between the manufacture of and sale of heavy engineering equipment and the management of tea estates, auction house and export of tea. This company also imported and sold to Indian customers a range of machine tools. He was asked to join the area which specialized in the import and sale of machine tools. Within a week Ulaganath was frustrated. He did not have the competence to understand the intricacies of machines.

Case material of Indian Institute of Management Ahmedabad

Contd. 2

2 “Get your head down and get cracking. Ulaganath spoke to his uncle that night.

We do not want moaners around”. The uncle promised to see whether he

could find another company more suited to Ulaganath’s talents. Some days later Ulaganath was told by his uncle, “I met old Charles Brickworth at the Club last night and told him that I had a very promising nephew who was looking for a break in a sales career.

Go and see Charles.

He is the Sales Manager of

Imperial Glory Engineering Works Ltd. He’ll do something for you. Ulaganath met Charles a week later. Charles liked him very much. He told him “If left to me I’d give you the job straightaway. But we have the bloody Head Office to reckon with.

I’ll send your bio-data to Simpson.

He’ll collect some 10 to 15

youngsters like you and ask you some nonsense, then four or five chaps will ask you all sorts of baloney for half an hour and then give you a bloody letter of appointment, I could jolly well give you now”. Ulaganath went through the process of selection and emerged as one of the two lads recruited as Management Trainees.

Ulaganath was asked to report to the

Calcutta Sales Office of the Company and to Simpson.

His terms of appointment

were that he would be a Management Trainee for 3 years at the end of which on successful completion he would be absorbed as a Junior Covenanted Manager. The first year he would receive a salary of Rs 300/- and Rs 375/- in the second year and Rs 480/- for the third year. These salaries were one of the highest offered by any Company for Management Trainees. On being covenanted Ulaganath would receive a monthly salary of Rs 625/- and a car would be provided for his official and private use. Progress in the company depended purely on merit. Imperial Glory manufactured and sold a wide range of consumer and industrial semidurables and were in the process of diversifying into the manufacture and sales of toilet preparations. Shortly after Manager of the new division called up Ulaganath who was on an induction tour of the factory and asked him to see him. Ulaganath, I’m the new General Sales Manager of the Toilet preparations division. You come along with me. I have cleared it with the bloody Head Office. No need to go around these bloody factories and more. Let’s get down to some hard selling”.

Ulaganath spent the next 3 years organizing dealer networks in Calcutta city and made remarkable strides in the introduction and sale of shaving requirements. Solely responsible for the sales of the product range, he had made a successful dent into the entrenched market of the more established manufacturers. His sale of safety razors, shaving cream, shaving soaps Contd. 3 3 had crossed Rs 5 lakhs per annum and was 10% of the Calcutta market. He had earned the reputation of being an ace salesman. Charles in recommending him for his covenant reported that Ulaganath was “the best salesman the company has”. The aura of “Ace Salesman” had been acquired by Ulaganath and was recognized by all concerned in the company. James Cockburn, the new Personnel Manager spoke to Charles in June 1962. “Charles, we are wasting Ulaganath in your set up. Jim is screaming in Madras. He’s got nobody worthwhile selling our electric fans and motors in the South.

The

business is going to the dogs. I think Ulaganath’s the chap for the job.” Charles agreed to release him provided he could promise Ulaganath that at the end of six months he would be made Assistant Sales Manager for the Madras Sales Area. “Sure, Charles, the boy’s a winner. Might make some of the senior boys worried, but we must encourage talent. Go ahead and tell him that subject to satisfactory performance he’s on the way to Middle Management in a year’s time. Fortune smiled on Ulaganath. The only competitor packed up business and went into liquidation. He exploited the old contacts he had in Madras and South India. His father moved in with him and helped him in meeting the senior management of companies that bought the range of products. Ulaganath knew all the dependable stockists throughout the area and before long had put the division on a sound footing. Profits on sales had quadrupled. He was shown the report on performance that preceded his appointment as Assistant Sales Manager in April, 1963 : “Extremely knowledgeable and very capable of directing his division’s activities clearly and intelligently. Highly dependable and self confident and proved beyond doubt that he has capacity to take on greater management responsibilities. Despite the problems and difficulties experienced this year, he performed very well and closely and effectively coordinated the work of

his division and factory and improved, on sales target set for him.

An

outstanding performance”. Ulaganath is intelligent, resourceful, honest and has tremendous drive ……… ……………. has established himself with major customers. Very mature ……….. distinctly above average performance”. Contd. 4 4 His report for 1966 mentioned : “Ulaganath has established himself as a leader ….. He brooks no delay in himself and therefore in others …….. A jolly good chap to work with.

His

juniors are slowly realizing that a rough exterior hides a good heart. He has won the respect and confidence of all customers, with adequate assistance, to show as a competent Sales Manager”. 1966 saw a rapid Indianisation and most Englishmen returned to the parent company. There was a reorganization of the business, some parts of the company were sold off to Indian interests.

Product divisionalisation was discarded and the

company’s activities divided into 6 zones. Zonal offices were set up. The Zonal Sales Office would sell all the Company’s products.

Manufacturing activities within the

zones were brought out of the commands of the product managers in H.O.. Ulaganath was promoted and transferred to Delhi as the Sales Manager. He reported to the General Sales Manager who in turn reported to the Chief Executive. Ansuman Balesar was appointed Production Manager, North.

He had been the

factory engineer of the Calcutta Factory as a young man in his late twenties. He was born and brought up in London and had qualified from the prestigious Imperial College.

He had a cultured accent, fine manners and a way with the Europeans.

Most of his colleagues, Ulaganath in particular, resented him on the ground that he was a favourite with the erstwhile British Managers. There were several problems which cropped up between Ulaganath and Balesar. Their usual conversations which ended up in near fisticuffs followed the pattern:

U

:

What do you think you are? Why are you not producing 16” fans

required by the Public sector customers? You are merrily manufacturing 48” fans that are having dull sales. Are you just producing what you like or are you an instrument that I use to cater to the markets and market demand?” B

:

“Come on, you have only to book orders. I’ve to make them

economically, ensure that my cost center is functioning efficiently. And your customers do not pay on time. Do you know the heavy financing charges we’ve got to bear - some of our customers pay about 6 months after delivery. I am planning my output according to what my Commercial Manager tells me is most economical.” U

:

“Don’t try to confuse me with all your commercial numbo-jumbo. You

do what Contd. 5 5 the market wants.

Business will not wait for all the sophisticated

production planning you do. Why are you not stocking the bought out blades in sufficient quantities?” B

:

Since our suppliers are very prompt we can afford to wait to get

components as and when we require them. I say, why don’t you go to that course the Staff College is organizing. You’ll understand how business is run better, if you do something on those lines. Have a chat with the Head of Personnel Division. In 1966, Ulaganath was sent to a Management Development Programme run by one of the Institutes of Management. The Head of Personnel was told by Ulaganath that the course was excellent and he had gained a lot. Y.K. Sharma, a nephew of the Head Personnel Division had also attended the course.

Meeting his uncle three

months after the course, he said, Your chap Ulaganath had been at the course with me. He’s a jolly and good fellow. Must have a very high entertainment allowance.

He feted us all and how? He had a group with him everyday at the bar from 8.00 P.M. till the bar closed. He made a lot of friends. One of the chaps who attended the course with us saw him in Delhi and Ulaganath has sold Rs 20 Lakhs worth of goods to him.Damn good, salesman, Ulaganath”. Ulaganath’s next report read: “His job is to increase sales, keep customers happy, fight competition and ensure a satisfactory growth rate – he did this admirably during the year … ….. All like him because he is intrinsically good at heart and it is because of his anxiety to get things moving and done, there are these occasional outbursts – similar to where commander in the battle-field would do to his troops behind with the enemy in front”. In 1970, the Company faced with interminable squabbles from manufacturing and sales units, decided that there was need for a reorganization.

Ulaganath was

appointed Sales & Commercial Manager at Bombay. He would report to the Resident Director, West. The factory had a Factory Manager, also reporting to the Resident Director. The position of General Sales Manager and General Production Manager were abolished. Contd. 6

6 Sales of all company products grew rapidly. The Resident Director complained to the Chief Executive : “Ulaganath is a very good salesman, but I have to spend half the day sorting out problems between

him and the Factory Manager. He has no

commercial insight, as a matter of fact, some of his inventory is piling up, decisions and pricing are suspect. Though turnover is increasing the return on capital employed is diminishing. I wonder whether we should revert to having a Commercial Department reporting to the Factory Manager?” The Resident Director writing Ulaganath’s report for 1972 said “As a Sales Manager he has performed above average but his contribution to the Commercial Area has been below the average I’d have expected from him. His organizing and planning skills leave much to be desired. He delegates

responsibility, but is very demanding and pushes his subordinates whenever required.” In 1973, Balesar who was the Factory Manager, Calcutta, was appointed Resident Director, Bombay. Ulaganath was most upset. He rang up the Chief Executive and asked for a meeting with him. He flew to Calcutta and told the Chief Executive : “I find it difficult to understand how you can appoint that whipper scapper Balesar as my Boss. I’m older, have longer years of service. My contribution is fantastic. I’ve increased sales at a rate of 25% per year at least wherever I’ve worked. Balesar interferes with my commercial function. He is only interested in increasing profits, has no feel for what the customer wants.

He’ll ruin the market and spoil the

relations I have built over the years. Please transfer me to Calcutta, I do not want to carry his can when the market collapses”. Ulaganath was transferred to Calcutta in early 1974.

The Resident Director,

Calcutta, reporting on his performance, said: “Has made significant contribution in the selling side of his responsibilities. His personal integrity and loyalty ti the Company is beyond question ….. He is more a hands on

than planner and thinker.

I have had to intervene on

several occasions to derive any meaningful results from our Business Plan. He is not capable of coordinating the sales function and factory production planning. I do not see him growing any further”. Contd. 7

7 Ulaganath seeing this report on him asked to see the Chief Executive. “How can I continue in the Company? He moaned. “I’m neglected.

Everybody criticizes me.

See the amount of sales I’m getting. The chaps who work for me have so much respect for me. They know I stand for no shirking. Everybody works very hard. We keep the factory on their toes. That the Factory Manager and his boys don’t like. Why is everybody so critical of me when I’m giving them all the sales they need to keep us humming?.”

The Chief Executive told Ulaganath : “When you came to see me last year you were upset with my having appointed Balesar to the Board. Baleswar is not making the sales strides you have, but his return on capital employed is increasing more rapidly and is now the highest in the company. If you had continued at Bombay you’d have shared the glory”. Ulaganath went into a tantrum, “So even you are questioning my commercial judgement? Baleswar was lucky. He cashed in on the inflation. Do you think I do not know what is sound commercial judgement? One of my instructors at the course I went to said, that there was no one he’d seen with such deep insight into commercial and environmental matters.

The trouble is that none of you pay

sufficient attention to the customer. He is supreme. He is your God. He can give you the profits you want. Why don’t you recognize that.

And is there anyone in the

company who can deal with them like I do? They eat out of my hand. Understand that”. He blazed out of the office. Three weeks later the Chief Executive received a letter from Ulaganath: “Dear Sir : After a fortnight’s scald and heart searching I’ve come to the sad conclusion that I can no longer serve you in the manner you wish me to. I have decided

to accept

a

job

of Marketing

Director

of a

small

pharmaceutical company in Bangalore. Please accept my resignation effective 15th August. I leave with a very heavy heart. I grew with this Company and participated in its growth. I learn’t my trade here. Yours sincerely Sd/Contd. 8

8 The Chief Executive looked at the letter and rang up the Head of Personnel Division. “Shree Ulagan has put in his papers. Can I have your recommendation on what to do? Okay, I will wait for a week. You are right, have some work with the Resident Directors”.

The Head of Personnel Division gave the following recommendation: 12th July, 1974

Head of Personnel Division To : Chief Executive Ref: Ulagan’s Resignation

I have gone through Ulagan’s record with us and discussed it with the Resident Directors under whom he worked over the last few years. From these I conclude that Ulagan shows a progressive deterioration in effectiveness as the years go by. Throughout he has remained

an excellent salesman, abrasive in his internal

relationships, a hard and difficult task master who was impatient with his subordinates. The expertise he has gained over the years is very valuable to the Company. My own assessment is that he will leave unless we can assure him that he will be the next Resident Director.

From all accounts he is not competent to make it.

His

attitudes are such that any suggestion that he attend a T – Group laboratory will be misunderstood by him. Recommend that his resignation is accepted. Sd/-