IIT Success Stories – Ankit Mishra


‘I’m A Product Of McKinsey’
Rajat Gupta

Mr. Ankit is a B. Tech.
from IIT, Delhi and a Faculty in Maths

Rajat Kumar Gupta is the  managing director of the $1.3 billiion McKinsey & Company worldwide. He joined the firm’s New York office in 1973, assumed leadership of its Scandinavian offices in 1981, and joined the Chicago office in 1987. He assumed the role of office manager there in 1989, was elected managing director of the firm in 1994 and re-elected twice, once in 1997 and again in 2000.

Since joining the firm, Gupta has directed a number of projects aimed at helping companies develop new product/market strategies and reorganize for improved effectiveness and operations capabilities. He has a broad range of consulting experience with a variety of industries, including telecommunications, energy, and consumer goods.

Gupta is Chairman of the Board of the Indian School of Business and recently was nominated co-chairman of the United Nations Association of the USA. He is associated with many other professional and business affiliations, including: Private Sector Representative to the Board of the Global Fund for Aids, Malaria, and Tuberculosis; Chairman of the Board of Associates of the Harvard Business School; and Dean’s Advisory Council, Massachusetts Institute of Technology Sloan School of Management.

Gupta holds a bachelor of technology degree in mechanical engineering from the Indian Institute of Technology and an M.B.A. from
Harvard Business School.

He obviously is a shining example of how talent and hard work can bring up an orphaned boy from a poor family who couldn’t continue studies without scholarship, to IIT and then Harvard Business School and then to the position of Managing Director at the very prestigious McKinsey and Company.From Rajat Gupta’s pronouncements it is very pronouncements it is very clear that race and national origin didn’t hinder him at all since Harvard and McKinsey are all pure meritocracies and seem to care only about talent and hard work.

WHAT TOOK RAJAT TO THE TOP

Several partners, consultants, and directors at McKinsey—as well as McKinsey’s clients and alumni—were interviewed to identify the specific factors for Rajat Gupta’s rise to the top:
·    Intelligence: Was a brilliant student at IIT-D and Harvard
·    Vision: Has always seen the big picture very quickly
·    Integrity: No doubts about his dedication to his clients
·    Track Record: Did exceptional work in Scandinavia and in Chicago
·    Experience: Experience in India, Europe, and the US will be handy
·    Loyalty: Has worked with McKinsey for 20 years
·    Patience: Low-key approach is refreshing
·    Hard Work: Willing to work at a problem until the job’s done
·    Team Play: Spends time building teams and working by consensus
·    Creative: Uses unusual methods to arrive at solutions
·    Open: Always available to offer advice
·    Maturity: Is one of the youngest in most settings
·    Humility: Has a down-to-earth approach and did not lobby for the job
GLOBAL PERSPECTIVE: As McKinsey gears up for the challenge, who better than the India-born Gupta, who won his spurs in Europe and the US? Gupta’s first test came in 1981 when he was sent to Scandinavia to manage McKinsey’s operations there. Gupta was one of the youngest partners to have been entrusted with such a responsibility. “I was 32, and still a principal. It was very unusual for a principal to be office manager,” he admits. At the Scandinavian office, Gupta turned around McKinsey’s prospects.

LEADERSHIP: Gupta showed early signs of being a general rather than a foot soldier. Soon after he graduated from IIT-D—where he was general secretary—Gupta was called for a job interview at ITC. On the panel was R.C. Sarin, who now heads Carrier Aircon. Twenty years later, Sarin bumped into Gupta at a seminar in Delhi and instantly remembered the young man he had once interviewed. For, when asked the attributes of a leader, Gupta had given a memorable reply: “One who can motivate his colleagues and get things done without making his teammates feel that it was the leader who had actually got the work done.” Summing up Gupta’s leadership style, a colleague in the Chicago office, director Chip Chandler says: “Very quiet. Leads from behind. Builds consensus.”

INTEGRITY: Advocated by Marvin Bower—the guiding spirit of the company founded by James O. McKinsey in 1926—McKinsey consultants are expected to function by the Firm Code. The five tenets: to put client interests ahead of Firm interests; to serve the client in a superior manner; to adhere to high ethical standards in everything the Firm does; to preserve the confidence of clients; to be ready to differ with client managers and tell them the truth even if it hurts. Not surprisingly, Gupta has treated the code as sacred and has won a squeaky-clean image in the process.

PEOPLE-ORIENTED: Gupta always finds time for people and their problems; he personally knows all the 148 senior McKinsey partners around the globe, and most of the 400 partners. Says Varun Bery, a former McKinseyite, who is now with the investment bank CS First Boston: “He has a very down-to-earth style. He is approachable by colleagues at all levels.” In December 1993, Gupta flew down from Chicago to spend three days with the young McKinsey recruits in India. Says Ashok Alexander, partner, McKinsey India: “He found the time to have dinner with a group of associates whom he will possibly never see again in his life.” Adds Shashi Khanna, director, MAP Consultants, Delhi, a friend from his IIT-D days: “He values relationships.”

LOYALTY:At a time when loyalty is at a premium, Gupta has spent his entire working life with one organisation. Especially as McKinsey is a rich hunting ground for CEOs: IBM’s Louis Gerstner, Westinghouse Electric’s Michael H. Jordan, American Express’s Harvey Golub, Tele-Communications’ John Mallone, and Levi Strauss’ Robert Haas have all been McKinsey consultants. Gupta, however, has never looked askance at any McKinsey command, always putting the Firm’s interests before his own. He refused the offer to try out Copenhagen for two weeks when the Scandinavian move was mooted. And while moving back to Chicago, he only asked a McKinsey associate to buy him a suitable house to move into—without even seeing  it.
PERSONAL VALUES: Despite cut-throat competition, Gupta is admired in the McKinsey world for his humility and unassuming airs. Says Sanson: “He cares for other people’s successes like his own, and does the right things for his clients. And more than everything, he is very humble.” Adds Richard Cavanagh, executive dean, Kennedy School of Government, who worked on-and-off at McKinsey for 17 years: “I’m a real fan of Rajat. He has astounding maturity for someone so young.”

That is important, as McKinsey’s partnership environment is a flat organisation, where the managing director of the firm isn’t a typical CEO. Even the election—not selection—is more like the cardinals in Rome electing the Pope. There is no electioneering and you cannot declare yourself a candidate. All the directors around the world vote on the top few candidates every three years. This year, the 148 directors narrowed it down to two candidates, Gupta and Don Waite, head of the New York office. The vote was by secret ballot, processed by Price Waterhouse.

Does Gupta’s appointment mean that Indians are finally ready to storm the bastion of White Anglo-Saxon Male CEOs? Not likely. Says Shyam Lal, an IIT-D and University of Chicago McKinseyite: “It is less a breaking through of the glass ceiling, and more a reflection of the fact that it was time for a young man with a global background to step forward.” Adds Atul Kanagat, 38, a principal at McKinsey’s Chicago office: “It will not have that kind of effect. Few companies would model themselves along our lines. At the same time, Rajat’s been one of our most successful partners, and so, it’s quite a natural progression for him.”

McKinsey follows a brutal up-or-out policy: if you don’t make it to the next level within a reasonable number of years, you are expected to leave. Associates, the new recruits, usually take about six years to become principals; about one in six makes it. It takes another six years to become a director, and only one in 10 associates becomes one. As a result of this policy and the constant headhunting, McKinsey has about 3,500 well-connected alumni the world over.

Ironically, getting to the driving seat may prove to be a lesser challenge for Gupta than steering the McKinsey juggernaut in the future. One criticism is that the Firm has grown too fast to deliver value for money. McKinsey has also been accused of being too bloated to serve its clients well. Gupta admits he needs to fix this: “We’ll simplify our structure a little bit. We may have become—because of our size and growth—a little complex in our governance structure.”

In the meantime, smaller firms— A.T. Kearney, Bains & Co.—are chipping at McKinsey’s business. While they don’t have the Firm’s reach, they are expanding. For instance, A.T. Kearney CEO Fred Steingraber is initiating a blitz in India this month.
Another sore point with carpers is McKinsey’s fees, which are the highest in the business. Gupta agrees, but says: “We are expensive because of what it takes to attract outstanding talent.” Talent doesn’t come cheap: associates earn up to $250,000 a year until it’s time for a promotion. And according to David Lord, editor of Consultants News, Gupta should make “between $2 million and $4 million a year” when he takes over.

In the history of the Firm, two managing directors are credited with playing a crucial role: Ron Daniel and Marvin Bower. If Tom Peters is correct, Rajat Gupta may be the third CEO whose tenure could be a watershed in the history of the Firm.

Rajat Gupta Addresses U.N.
“Mr. Secreary General, Members of the General Assembly, it is a great honor to address you today.
I have spent much of my life ina dialogue between, government and civil society. I speak to you today as a true–believe in the ideal that when we three work together in public–private partnerships our world works better.
But mistrust and misunderstanding prohibit us from working together more often. And when that happens, we all lose – business loses opportunity, government loses credibility, but society loses most of all.”

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