Listen to the podcast to learn about
02:30 - Culture is the Identity of a Startup
07:00 - When to ‘Document’ Culture
16:00 - Building for Scale is Different From Managing Scale
21:30 - Dealing With a Downturn & Taking Big Chances
27:00 - Founder Belief & Good Governance
34:00 - Diversity & Harnessing Dissent
41:20 - Touching Life of Every Entrepreneur in India
Read the complete transcript below
Amit Somani 00:50
Welcome to the Prime Venture Partners Podcast. Today, I am delighted to have with me T. N. Hari, who is the co-founder of the Artha School of Entrepreneurship, a new venture that he’s starting out. I’ve known Hari for many years as the Head of HR at BigBasket, then as one of the partners at Fundamental and just a writer at large. He’s prolific, he’s written six books. I was just doing this math before this show. I have read three of those six, so three more to go, but I’ll get there. Welcome to the show Hari.
T. N. Hari 01:23
Thank you so much for having me Amit.
Amit Somani 01:27
Great. Hari, we could have a very rich and a wide ranging conversation, but the zeitgeist for the time is around culture, around hiring, around managing during a downturn. In fact, you’ve written a book with one of my partners here, Sanjay Swamy on Sailing through a Storm, which was probably written in the COVID era, but is equally relevant now as facing some economic headwinds. Maybe you can talk a little bit about what do you think is culture and how does one define it, how does one go about building it?
T. N. Hari 02:00
Right, I think culture is an extremely important element of a business Amit. I think Peter Drucker had talked about culture having strategy for breakfast. I think that’s not exaggerating it one bit. I think culture in startups really is a little more important than culture in larger and more mature companies for the simple reason that the culture creators in a startup are still very active, which is the founders plus some of the early stage employees are still active. They would defend the culture almost in a cultish way. The other reason why culture is important in a startup, extremely important is because it gives the startup an identity. A startup typically does not have an external identity, does not yet have a brand, does not yet have a reputation. An internal identity that can rally everyone together is a very important element of the business as well. The last reason, of course, is that culture in a startup, unlike in a larger company, is formed after everyone in the startup goes through a lot of ups and downs, trials, tribulations, difficulties, near-death moments. Under these circumstances, the culture takes shape. Therefore, people guard it almost in a cultish way. Whereas in a much larger company, the founders are no longer around and culture has gotten embedded into the artifacts, policies, espoused values and all of that.
I think culture is all about really, if you ask me, the kind of behaviors that founders and a few senior employees, leaders in the company demonstrate and live every day. It is the kind of behavior that is recognized and rewarded. It is the kind of behaviors that are discouraged and almost penalized. Ultimately, it’s the kind of things that founders and leadership teams track what are the kind of metrics they track, what do they really care about, what don’t they care about, what questions do they ask, what kind of answers do they expect? Are they okay with all kinds of answers? Can they tolerate dissent, can they harness dissent? A lot of these founder behaviors, I think which are lived every day and which manifest itself in multiple ways, including rewarding and recognizing and penalizing people and their behaviors, I think that really is culture. Artifacts don’t define culture, the kind of office set up, the dress codes, the espoused values, like, “We are a customer-centric company,” those don’t really constitute culture at all.
Amit Somani 04:20
Let me challenge you a little bit on that. Let’s say I’m a founder of a young company, 10-20 employees, just getting started, early product market fit. I’m like, “Hey, why should I care about consciously defining culture or not? We are who we are and we operate as we operate,” number one. Number two, let’s have a slightly more mature, “Founder,” and I get that I need to define culture. How would I do a quick dipstick and for lack of a better word, a quantitative assessment on where am I now or where is our firm now? Do we need to, one, articulate what it is and what we stand for and all the things you said, how do we make decisions and how we hire and fire people? Both those questions, why should I care, and two, how do I quantify where am I now?
T. N. Hari 05:05
Right, I think irrespective of whether you care or not, you bring a certain set of culture elements into the startup because culture really for an early stage startup, I think equals founders. Founders bring their personalities to the workplace. They have to bring their personalities, irrespective whether they care or not. Those personalities over a period of time begin to define what is culture. Organizational personality becomes equal to founder personality, at least in the early stage. I think as the company hires more people, I think some of their cultural elements and beliefs begin to rub in and culture begins to become a bit like a melting pot. I think frankly culture really equals founders. Irrespective, whether you care or not, culture comes into the company in the form of your personality. Coming together should be written … It doesn’t really matter whether you write elements of your culture or not. I think it is what you do and behave every day.
People don’t care about what you talk about. For example, if you say, “We are extremely customer centric company,” but don’t demonstrate any element of customer centricity in decision making, the kind of trade-offs that you make and trade-offs are a very essential part of managing the business. If the trade-offs are against the customer, then people really know that customers don’t really matter as much as stated. I think ultimately whether you document your key elements of your culture or not doesn’t really matter a great deal. The only reason for documenting elements of your culture, if you really wish to, is because it very crisply communicates to the rank and file. As you begin to become a larger company, you can’t always have founders, let the behaviors drive cultures because people don’t get to see those behaviors. Then, they need to be embedded in the form of some documents. As the startup grows, it becomes embedded into some kind of policies as well. Policies after a point of time begin to reflect culture. In the beginning, they may not, but as the startup grows, it gets embedded into policies. Policies, for instance, begin to reflect culture. Irrespective whether you define it or not, call it out or not, you are going to bring culture into your startup.
Amit Somani 07:20
Like I said, how would you assess where are we now? Would you recommend doing something like a 360? Would you recommend something like … Often, I have told people that the culture is what the 50th employee or the 500th employee in the company says the culture is, not what you claim or what your mission, vision, whatever statement claims. How do you figure out where are we at now and where do you go from here?
T. N. Hari 07:45
Yeah, good question. Let me just simplify this a little bit by taking an analogy from a parallel world. For example, all of us are individuals. We have our own personalities. We all can take tests. For example, there’s a test called the MBTI test. There is Thomas-Kilmann Instrument Assessment for the way you manage conflict. By taking those tests, you are able to figure out what kind of a person you are, what’s your preferred style of dealing with conflict. Thomas-Kilmann Instrument, the instrument identify five predominant styles. Typically, people fall into one or more of these styles. Some people of course become mature over a period of time and can switch, but typically people fall into one dominant style. That same is true for MBTI as well. Individuals have personalities, organizations have personalities. Organization’s personality is what I would call culture. You can have an instrument.
At the Artha School of Entrepreneurship, we have come up with a simple instrument, which is just a set of 40 questions. These 40 questions are just simply paired statements that participants or those who take this survey need to pick. By getting people in the startup, it could be founders plus let’s say 40-50 employees to participate in this survey, we’ll be able to figure out what the culture of the startup is. Just as MBTI, for example, identifies 16 dominant personalities and the Thomas-Kilmann Instrument identifies five dominant styles of managing conflict, this Artha scale for culture assessment instrument identifies four dominant styles when it comes to culture. That’s the way you can really look at culture. Just as MBTI and the Thomas-Kilmann don’t necessarily result in you changing. It creates self-awareness as to who you are as an individual, what are your styles, what are your strengths, what is it that you should continue to do, and what is it that you should let others do, how can you raise your hand in the right time, how can you pick people with complementary skills? That’s about self-awareness.
The same thing about culture also. When you do a cultural assessment, it creates some degree of self-awareness for an organization, so that just as an individual understands a few things and is able to lead her life better, organizations too can understand a few things about themselves and can lead their lives better and can grow in a more sustainable way, be more self-aware, not aspire to be what they are not.
Amit Somani 10:00
Understood. I want to double click on one of the words you said, “Self-awareness.” As founders go through the journey of zero to one, one to 10, etc., and not just on business metrics, but their own personal growth, I often find that self-awareness is a key defining factor between the good founders and the great founders. If I’m a founder listening to this podcast, how do I basically, both do a dipstick on my own self-awareness and how do I kind of get better? How do I walk on that journey beyond the instruments? Of course, you could do MBTI or some of these other things, but on a day-to-day basis, are there some tips and tricks that you have for people to try?
T. N. Hari 10:35
Amit, I think self-awareness is extremely important trait, probably one of the most important traits for success for leaders, not just for founders, but leaders in general. Broadly, you can classify self-awareness into two broad areas, internal self-awareness and external self-awareness. Internal self-awareness means are you able to reflect, ponder, understand who you are as an individual, where you’re coming from, what are your beliefs truly, what do you like, what don’t you like, what are you good at, what are you not good at? Some people don’t even have this internal self-awareness because they’ve never really looked inwards very thoughtfully and very carefully. I think internal self-awareness is very critical. External self-awareness is also important. When you’re beginning to work with people, one can argue, “What do I really care about, what others think of me?” Internal self-awareness as long as I understand myself and as long as I understand who I am deeply, why should external self-awareness matter? External self-awareness really matters because you’re working with people at the end of the day in an organization. Their assessment of you, therefore becomes important. You just cannot afford to ignore them. External self-awareness is what do others think of you.
For example, you might think you are extremely cool when it comes to strategic thinking, but others may not think so. If others don’t think so and you think you are that then that leads to a lot of tensions at the workplace. It’s very important to be externally self-aware as well. I think there are several instruments by which you can get externally self-aware, to some extent internally self-aware. Externally self-awareness is very easy to figure out because you can just administer a questionnaire to a bunch of people, who you work with and they can provide you feedback. That helps you develop external self-awareness, but internal self-awareness is a sign of a highly refined individual, somebody who has really pondered, reflected, looked inwards and understood what her motivations are, what her strengths are and all of that.
Amit Somani 12:35
Absolutely. I think of external self-awareness, I always say that something as simple as a questionnaire, like you point out, like a 360 degree review is extremely low cost and extremely highly effective. That’s the gap between perception and reality. By the way, it need not even be a gap, it could be that there’s a strength you have that you don’t recognize. Everybody’s like, “Oh my God, you’re amazing at strategic thinking,” or whatever. You’re like, “Oh really? That’s just play for me.” That can help you manage better. I definitely encourage people to think of … The internal one is a very good angle as well. Is there any tool for that or is it just self-reflection and journaling and working with a coach maybe?
T. N. Hari 13:10
Yeah, I think self-reflection and looking inwards, spending time talking to two or three people that you can completely trust through that journey of internal introspection.
Amit Somani 13:23
Great. Let’s move on from the macro company to the founders, self-awareness, internal, external to hiring and building an organization. Particular, let’s focus on both the senior leadership that you would have to bring on to a company to scale it. Can you talk about some kind of pitfalls and some do’s and don’ts as you’re trying to bring senior people into the company for founders that are looking to scale up?
T. N. Hari 15:50
Right, so I think when you bring senior leaders, I think you should look for a bunch of things and you should certainly ensure that they don’t demonstrate a few other things. I think, for example, someone who asks for a job description is just not fit to be in a startup. That’s for me a big red flag, for instance, somebody who’s looking for a job description, asking a lot of detailed questions on exactly what my responsibilities are. That’s a red flag. The other most important thing that I would want people to be careful about is that when you interview people to manage for scale, you would be looking at people who’ve already worked in larger companies. Sometimes, there is a mistaken belief or notion that people who manage scale can also build for scale. The two are very different, and it’s important to recognize that because managing in a scale environment is pretty much easy because you have a lot of support, you don’t have to do everything yourself, you have a large team, who will do all the grunt work for you, solve a lot of problems before they bring it up to you.
You might have lost all your ability to be hands-on and solve some fundamental issues in your respective functions, but I think that’s not a good thing in a startup because when you come into a startup, it’s possible that you have to roll up your sleeves and do all the things right from the very beginning. You will be responsible for building for scale. Building for scale is something that many people would not have learned because they have just gone into a scaled environment and managed. I think building for scale, you need to look for a lot of first principles thinking. You need to look for an ability to solve problems by asking very elementary questions and the child like curiosity to understand something. I think some of these are very important.
I think when you interview people for senior roles, you should ensure that you figure out whether somebody is going to fit your work culture or not, will they be able to respect the kind of work that you’ve done so far and the people who brought your startup to where it is today? Will they be able to gel with them or will they think that these guys are too execution and they themselves are extremely strategic. Therefore, very different. Will they be able to respect, and will they be able to earn respect? I think that’s very important because I’ve seen so many lateral hires brought in, but fail and fail because they have lost their ability to be hands-on, as a result of which all their teams, who have been hands-on so far will lose respect for them. I think they should still be able to be hands-on and also bring certain additional perspectives, which the existing employees don’t have. They should be able to really bring some strategic big picture perspectives along with an ability to work through the details. I think that combination is very important. If you can’t get that combinational leader, you are done for. You just can’t have a person, who is very hands-on, but has a large number of years of experience or somebody, who’s got a large number of years of experience, but has lost the ability to be hands-on. I think both are very critical.
Amit Somani 17:00
In a lighter vein, do you have any favorite interview questions to cess this out, either the growth mindset and openness and childlike curiosity and so forth or vice versa, right?
T. N. Hari 17:15
Yes, so I think interview questions can be of multiple types, and interviews can also be of multiple types. The most popular and powerful way of interviewing, I think most smart interviewers are able to do that, which is what I would call a behavioral event interview, BEI kind of a style, which is if you’re trying to figure out whether somebody is good at execution or not, ask this person some real life example, where this person executed very well.
Ask this person to go into some details and tell us what you think distinguishes a person who executes really well from somebody who does not execute well? Give me some examples, where it was an extremely complex problem, a lot of inter-linkages and you were responsible for all of that, how did you ensure that you executed that well? I think you can just probe into specifics that this individual has actually done in real life around that. If you’re looking for clarity of thought, test for clarity of thought. Clarity of thought can be tested in many ways. For example, one thing I always start with is if somebody studied engineering or physics or history, I would probe a little bit to find out whether this person was even interested in the subjects that they studied in their life. Do they still remember, at least how a differential gear works, if they were a mechanical engineer or for instance, a very elementary Newton’s third law, for example, try to apply it and say, how does this happen? Do they understand that or in history, have they taken some interest to figure out some patterns or have they been able to connect some dots.
I’m not expecting them to be masters in their fields because many years apart, but at least have they done and taken anything in life a bit seriously? That’s one thing, which tells me that this person is a little sound or not. Then, we move on. I would ask a question, like for example, how would you think … We talk about let’s say mobility platform like Uber and I talk about how do you think their surge price algorithm would work? You may not know, I may not know how it works, but yes can we just talk through how probably this might work, what are the factors. Then, look at how this person thinks about this problem. I might ask this person a question in analytics, a very simple question. I don’t want to go into details and to figure out whether this person is able to ask the right kind of questions and think about even an analytics problem.
I think there are a bunch of questions that you can think of and when you interview, for example, head of marketing, what you should look for is slightly different. You could have five questions that in your mind can distinguish a great marketing person from an average marketing head or a great analytics head from an average analytic head, which brings me to the point that you as an interviewer, who’s interviewing for multiple functions should have a reasonably good understanding of these functions, not in depth, but you should at least know what goes into making great people in these functions. How will you evaluate those? Evaluating those, finding out those five questions is not really difficult if you spend some time on it.
Amit Somani 20:20
Absolutely. I completely agree with the behavioral style of interviewing. I almost never go through the resume or whatever. Generally, have an open-ended brainstorm on various topics and that tells you a lot about the candidate and so forth. I think that’s great. We talked a little bit about hiring and senior leaders and so forth. Let’s talk about the not so fun side of this, org building, which is firing or unfortunately laying off people or whatever. How do you think about that given the current zeitgeist of the time on how do you do this thoughtfully, effectively, deliberately? It’s never going to be easy, but maybe any thoughts and lessons learned and tips that you might want to share with our listeners?
T. N. Hari 21:05
Yeah, so let me just talk to you a little bit in an ideal situation, how should this be done, and then we’ll come down to the real world. I think dealing with a downturn, dealing with layoffs starts much before the downturn hits, which is that hiring needs to be done very thoughtfully. If you hire very thoughtfully, then you need not be reckless in firing. If you hire recklessly, you will have to fire recklessly. I think building an organization should be a little more thoughtful, and you should be figuring out whether you are doing something, which is unsustainable in the long term. If you’re doing something that’s unsustainable in the long term, then probably some situation will arise, where you need to take some drastic measures. When I say, let’s say something very unsustainable in the long term, let me explain what this means. For example, if you are a startup that has raised a $400 million round, you are cash rich and because you are cash rich, you go on a hiring spree, trying to deliver what you promised to investors. When you go on a hiring spree, you’re also burning let’s say capital to be able to create a market. Market creation should be sustainable, but let’s say you’re burning a lot of capital to create markets. Both of these are unsustainable.
Probably, you could be lucky because the downturn may not hit. By the time a downturn may hit, you are already sorted, it’s possible. It’s just that if you’re unlucky when the downturn hits, you’re dead. I think you need to be a little more thoughtful when you hire, and I think that’s probably you might tell me, “It’s easier said than done,” when a company is staring at a massive opportunity and is well funded, why should they not take their chances? I would say, “Yes, why should they not take the chances,” because if burning capital to create an awesome, amazing, huge market is a real possibility, you would want to take your chance at it. I think that’s very much a possibility, but then you have to also be prepared to deal with a situation, where the money tap is off, and you need to let people go.
Let’s say you’re in that situation, I think there are ways in which you can let people go gracefully. I think it’s a very difficult call because you might have hired them without too much thought. You must have hired in large numbers, and now you need to go back and tell them. You need to do it very thoughtfully. I’ll leave it at that at this point, and we can further go into it if you want to.
Amit Somani 23:20
Yeah, I’d love to dig into that a little bit, like what would thoughtfulness mean? I love the notion that hire recklessly, and then fire recklessly unfortunately, but let’s say that you did what you did, but you’re in a situation, where you’re running out of capital or you need to let go of people. Now, what are some thoughtful ways even during this time or things that you should do? Obviously, clear communication and open, transparent communication is the one that comes to mind, but maybe you have more thoughts around this?
T. N. Hari 23:50
Yes, so I think a couple of things. One is, of course, the startup is under immense pressure from the board to be able to cut costs very rapidly. I would say you should negotiate and discuss with your board in terms of what is the right thing to do long term because if you just fire people recklessly, then you are damaging your reputation and your ability to hire in the future. This is not something that you really want to do, unless absolutely essential.
I think you need to have a mature conversation with the board, push back with the board and look at other ways of cutting costs. If ultimately it comes to laying off people, then I think the way you should do it is you should be very transparent and honest about it. There’s no point saying that, “We are laying off people based on our performance cycle results, and we are laying off people, who have not been performing.” That’s so dishonest. I think it’s not just dishonest. It’s being very, very cheap with your employees. It completely damages your brand. I think it’s important to be very honest and let people know that, “This is our situation and the fact that if we don’t lay off 10% of the people, then this entire company can go down under. We are laying off this 10%, so the 90% can be safe,” because it’s very important to secure the loyalties of the 90%, who are going to stay back and ensure that they are not continuously scared whether they are going to be victims of the next round of layoffs.
I think you need to be very crisp in terms of how many people you want to lay off, what are the numbers, which function, how many? Do that exercise very confidentially and declare that. Be very transparent about the fact that you’re doing this for cutting costs and for preserving the company, so that it can live to fight another day. The 90% of the people who stay back should also get the confidence that there are going to be no more rounds and you’ve already done this very thoughtfully. You’ve not done it with half-baked information and the next round of layoffs will come one month down the road. I think because if you don’t secure the loyalties of the remaining 90% and that should happen after the round of layoff is completed, you need to call a town hall, talk to these 90%. Tell them that, “We’ve gone through this, we are done and dusted and our journey continues. We’ll hunker down. We’ll manage our costs, and we’ll build our business very prudently, but we are in business.”
Amit Somani 26:05
Absolutely. Yeah, lots of interesting thoughts there and completely agree with all of that. Switching gears a little bit and we’ll come back to the notion of org and culture building, one of the other things that’s coming out, sort of some of the ugly skeletons in the closet as it were, is this whole thing around governance. In the heyday, everybody is … I love your quote about hiring recklessly and firing recklessly. Perhaps, we as investors, are also to blame, like investing recklessly and maybe over capitalizing companies and so forth, but maybe not managing thoughtfully either and particularly … Maybe talk to us about some best practices around corporate governance, around ensuring beyond just hiring an org and culture, from both points of view because you’ve been on the entrepreneurial side at BigBasket and other ventures, and then you, of course, have been an investor for many years now. Maybe talk to us about some best practices around governance, around board and board management and so forth.
T. N. Hari 27:15
I think very honestly if you ask me, Amit, the foundation of great governance is founder beliefs and founder belief that governance is important. It’s an important element of running the business. I think if deep down, they believe that governance is important, then I think even though there may be a few missteps along the way because they may be a bit ignorant on the plumbing involved, they will be able to recover, things will never go completely awry. If the founders are not deeply committed to ethics and governance and if they feel that, “We can cut short in governance for short periods of time because you know what, it’s just one wrong decision, one unethical decision, we will not take any more of these, we need to take it now.” I think if you start breaking the laws once in a while, then I think there is no getting back. I think there’s a deep belief. Like I said, we always talk about processes, they work only if they are followed every time. If they are breached once in a while, then they are never followed. They need to be followed every time, even if for example if they become cumbersome, if a process is cumbersome, you can change the process. As long as the process is defined, you need to follow that.
I think the same thing holds true for governance as well. You need to stick to governance even in tough times, when you’re tempted to take one or two of those wrong decisions because when you take those one or two wrong decisions and you can get away, there’s a temptation to do them again and again. My strong belief is that the founder’s belief in governance being very important is the most important thing. If that belief is there, everything else falls into place. That belief is not there, you can put whatever mechanisms you want, you can have independent directors on the board, you can have an audit committee, you can have a compensation committee. You can have all kinds of board committees, but I think they will never be able to be very effective. You’ve seen Enron, you’ve seen Satyam, they had amazing board members, independent directors, but none of them could see through because the intent of good governance was just not there on the part of the founders. I think founder commitment to governance is essential, and I think the role the board plays also is important because what happens is that in some critical situations, if they wish to deviate from what is considered good governance, the board must say, “No, we’re not going to do this.”
But if the board is also very focused on business outcomes, business results and growth numbers and they are tempted to allow the founders to do some things, hoping that they don’t have to do them again, then I think it’s a disaster. I think the board should also play that role of ensuring that the first time around, they don’t commit that mistake. Right from the beginning, they are pushing for all the checks and balances. You can’t be hiring relatives into key positions. There’s so many ways in which you can construct all these mechanisms. Those mechanisms should also be in place besides founder commitment to governments.
Amit Somani 30:05
Right, so let me ask a question on behalf of my VC friends, but it might also be true for senior people wanting to join a company. How do I cess out the founders, either in the investing process or if I’m looking to join as a CXO or a CBO or whatever, CHRO, then are these founders committed to a good ethical high level of governance? Of course, you’ll do ref checks and all that, but are there ways to figure that out in a slightly more systematized manner?
T. N. Hari 30:35
Very difficult in my opinion, especially early stage investing, this is difficult because you can’t even do those ref checks. I think by the late stage investors come, I think the founders and the startups have a reputation or lack of reputation. That is very clearly visible in the market. People know about it. People talk about it to some extent. I think by the time growth stage investors come in, it’s a bit easier, ref checks work because there are data points. Those data points are known to employees, who exited, who’ve talked about this.
I think that is pretty clear I feel, but early stage investing, when you’re putting in your first check, second check or third check, at a very early stage, I think it’s not very easy. Having said that I trust my intuition and gut on this, which is when you talk to the founders, when you have a very informal conversation to spend two three hours in different settings by listening to them, by seeing what their beliefs are, by having a very insightful conversation, I think you will be able to suss out some beliefs of theirs, how important … You can figure out whether loyalty is important for them, for example. Are they the kind of people who will hire and fire? What kind of values do they articulate when you talk to them? I think that insightful conversation to me is the only way to get some idea of the founder’s beliefs and their approach to governance, ethics.
Amit Somani 32:00
Yeah, absolutely. I’ve also found just trying to figure a little bit about self-awareness and to use your term, “External self-awareness,” what do they think where are they and where is their company and what do others, the ones closest to them keep asking the same question to three or four people who are close to it. Often, if you see good, big gaps over there that can be an indicator that there might be some challenges over there. No, absolutely.
T. N. Hari 32:30
The other way also is that this is just a surrogate for me. I think you need ambition to build a business, you need ambition to eradicate malaria, you need ambition to do anything good, but at the same time, ambition if it gets a wrong kind of ambition I would say, ambition gone awry can also destroy. I think the way to spot good ambition versus bad ambition is good ambition is always about the organization, it’s about others, whereas bad ambition is about me, me, myself, how do I get myself out in the market, how do I get known, how can I build my personal brand? All of it is about me, myself. There is nobody else in the team. I think when it’s more democratic, when it’s all about the company, when it’s about fighting hard to get to the metrics that I think is positive ambitions. My own belief is that those with a positive ambition typically are more committed to ethics and governance. Those with that other kind of ambition I think are people, who will cross the line.
Amit Somani 33:30
Yeah, I don’t know if this is your quote or I’ve heard this said often, we before me is a very good indicator of distinguishing this. Switching gears, as we come towards the tail end of the podcast here, your most recent book, which I’ve still not read, Diversity Beyond Tokenism, Why Being Politically Correct Doesn’t Help Anyone. Can you talk a little bit about that? What is it about, and then we’ll take it from there.
T. N. Hari 34:00
Yes, so this book is not just about gender diversity, but gender diversity is something that we’ve taken head on and tried to deal with all aspects of gender diversity. We’ve also talked about other elements of diversity, which is, for instance, the ability to harness dissent is also an element of diversity. Many companies, even startups, sometimes find it very difficult to harness dissent, which means founders like to hear answers that they want to listen to. Over a period of time, people begin to tell them what they want to hear. Therefore, everybody around them is echoing what they want to hear, which is a very bad thing for a startup to become a good company. I think the ability to harness dissent is a very important trait and we’ve talked about that is an important element of diversity, where you bring in people with different backgrounds, different kinds of thinking, and then are able to harness their strength. We’ve even addressed questions like, for example, we look at culture fit often when we hire. Does culture fit for example go against the grain of diversity because diversity means you want people from different backgrounds, whereas culture fit means people who are suitable for your culture. Therefore, by definition, don’t meet the criteria of diversity. Is there a dichotomy there? We’ve talked about some of these dichotomies.
We’ve gotten to the root cause of gender diversity. For example, people talk about getting more women, and everybody is fighting for it, saying, “Let’s get more women,” but then you also need to understand things like why aren’t women not there currently in the workforce? As you go into more senior levels, why do they begin to drop off? What are some of the socioeconomic factors? Can you address some of those socioeconomic factors? Are some of them in your own control and some of them are in the control of society, for example. You may be able to do nothing about them, but then without seeing gender diversity in the context of a much larger socioeconomic situation, you will never be able to implement it the right way. Then, you will begin to only say the politically correct things. We’ve talked about that.
We’ve also talked about what can you do potentially to get, for example, more women into the senior management roles. We’ve also killed some holy cows. For example, one of the reasons given for gender diversity is that women and men are different and they bring different perspectives to the table. We, for example, took the story of James Damore from Google. He had put out an internal memo, which stated that men and women are very different. Men can write great code. Women are not genetically wired to write great code. All of Google’s efforts to make women write code by putting in special hours after office is all a failure. It won’t work at all.
Sundar Pichai was on vacation. He cut short his vacation, came back, and he fired this employee, but the counter to what he was saying and what he was saying was not correct because no research shows that men and women are actually different. All the research points to the fact that men and women are identical when it comes to most talents. There is no evidence to show that they’re different. Now, the counter to that is if there is no evidence to show that they are different, then what is the need to bring women into the workforce, using that justification. Our point there was that you don’t need any justification to bring women into the workforce. They are just 50% of the population, just as you don’t need any justification to send girls to college or school and use the justification that they will change the discourse on education. They just are entitled to education, just as much as men are. The same thing about women as well. You don’t need all of these fake justifications.
We’ve also talked about how McKinsey report after report, how they have used evidence in a very one-sided, half-baked manner to reach wrong conclusions. Those wrong conclusions are very populist conclusions. They will be applauded, but those are not the correct conclusions. In all the reports, they end up confusing correlation with causation, so you can’t confuse correlation and causation, where you look at a set of companies and figure out that 20 companies, which have employed women have got better financial metrics than 20 companies, which have not employed as many women. That’s confusing correlation with causation. That needs to be understood. We’ve talked about that in some detail as well.
We’ve talked about the MeToo movement. We talked about, for example, how debates sometimes get unnecessarily converted into a man-woman debate, a gender debate, whereas the debate need not be about gender at all. There’s so many stories, we’ve talked about them. I think that’s broadly the book.
Amit Somani 38:45
I would be remiss in not asking you for any other book recommendations than your own or any interesting blogs or other things you follow for what you read on a regular basis, if there’s one or two that you’d like to state here on the podcast that’d be great.
T. N. Hari 38:55
Yes, I think I liked Satya Nadella’s book, Hit Refresh, I may not be able to recall it off-hand. For example, I’ve learned a lot about leadership, not from management books, but by books about some individuals, inspiring individuals. The life of Shackleton, for example, the life of Abraham Lincoln, the books written by very famous authors on these two individuals, for example, teach you a lot more about leadership than any management book can teach you about. I like this book Loonshots as well. Loonshots was by Safi Bahcall. Although the book is about 350 pages, almost 320 pages, it could have been written in 100 pages probably because the essence of the book is 100 pages, but I still like the book. Yeah, those are some names.
Amit Somani 39:50
Wonderful, no, these are some amazing … Other than Satya Nadella’s book, I haven’t read any of these. I’m sure I will put that on my reading list, and I’m sure other listeners will. Hari, as we wrap up, can you talk to us about your new role at the Artha School of Entrepreneurship, and what are you guys trying to do over there?
T. N. Hari 40:05
Amit, eight of us have come together to start this Artha School of Entrepreneurship. Our mission is to really impact the journeys, scale journeys of thousands of entrepreneurs and help their journeys become a little more smooth and in the process, contribute to the socio-economic prosperity of the country. The vision is really to be the world’s best school of entrepreneurship, and we have set this up as a Section 8 Company, which is a not-for-profit. We are a not-for-profit organization. We are not here to make money. All of us are at a stage in our life, where we really want to give back because we benefited immensely by being a part of this ecosystem. Both emotionally, financially, we have loved the ecosystem that we’ve been part of, and learned a lot. We really want to be giving back.
For us, our legacy would be if we can talk about a 100 companies that participated in our programs and their scale journeys became a little more smooth and entrepreneurs can give us some credit. We really want to touch the lives of every entrepreneur in India, be they in Patna, Bhubaneswar, Madurai, Coimbatore, Jaipur, small towns … These are buzzing with activity, entrepreneurial activity. I would always say India’s entrepreneurial ecosystem is somewhat can be figured out by looking at the films or cricket, for example. Cricket, the first 50 years of independence, Bombay, Hyderabad and Bangalore or Karnataka won the Ranji Trophy 80% of the time, but after that you’re finding all of these states like Haryana, Rajasthan, Uttar Pradesh, Bihar winning the Ranji Trophy. IPL is full of players, who don’t speak English, who come from tier III, four IV towns of India. The same is true of entrepreneurship.
I think entrepreneurship in India is here to stay. It’s not just the number of unicorns and soonicorns, but the fact that our tier III towns are buzzing with entrepreneurial activity. The confidence that these new age entrepreneurs have in solving India’s wicked problems for the 400 million consumers, which gives me confidence that this ecosystem is here to stay. Therefore, we need to play a part in making this more vibrant, supporting this to the extent possible. Someday, we also wish to do a post-graduate diploma in entrepreneurship and create some kind of a school like ISB. That’s our dream as well.
Amit Somani 42:20
Fantastic, a very noble and very thoughtful vision and a mission. I’m sure you’re going to do great. I’ve seen a little bit of behind the scenes of what you guys are up to at Artha. I strongly encourage everyone that is interested to check them out. Thank you so much Hari for being on the Prime Venture Podcast. Really, was delight to have you.
T. N. Hari 42:40
Thank you Amit. I think it’s always a privilege being on this amazing Prime Venture’s Podcast.
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