Over past one year, and across 72 episodes, the Outliers podcast has been quite a conversational journey. Thank you, dear listeners, for being part of this journey.
Starting this week, we are going to publish complete transcripts of these conversations; one by one. Hopefully, by the time we hit the 100 episodes milestone, we will have all the transcripts available, thanks primarily to Kanika Sood, a listener of the Outliers podcast who is helping transcribe the podcasts for FactorDaily.
Ravi Venkatesan, the former chairman of Microsoft India and the author of “Conquering the Chaos: Win in India, Win Everywhere” sat down with us for the 56th episode of Outliers. The edited transcript:
“Don’t get fooled into thinking you have a life long career. At any moment, you need to be prepared to be independent and stand on your own two feet. If you prepare yourself for that, I think you are going to have a much better, sort of ride along the way. So think about yourself as self-employed.”
Pankaj: Welcome to Outliers. Today’s Outlier is a Outlier in many ways. I am sitting down with Ravi Venkatesan who has been a business leader over years. Some of you would remember him as the former chairman of Microsoft India. The famous book he wrote that became a template for many multinational corporations to understand how to do business in India. Welcome to the podcast, Ravi.
Ravi: Hey. Thank you, Pankaj, and appreciate that introduction.
Pankaj: Thank you. Just to kick things off, Ravi, before we get into the topic of jobs that we are going to go deeper, tell me a bit about yourself. Like, throughout your career how do you stay relevant and how do you discover the next thing that you want to do? What are those curves for you? And then we can talk about what others should be doing.
Ravi: I wish there was some sort of master plan or strategy that I could describe. I think somebody famously said that ‘you can connect the dots only in hindsight’. So I don’t think what has played out has been part of some grand design. It has just ended up this way.
I had a perfectly ordinary start. I have studied at IIT Bombay. In 1985 when I graduated, there were no jobs, so I think things are coming around full circle. So like, most of my graduating class, I had only one intention which was to go to America. And so I went to do my graduate work there, got a job and then India in 1991 began opening up and I felt the need to come back and be part of the generation that contributed to building a modern India. I didn’t think I would stay long, I thought I might stay a year or two. It’s been 22 (years). So again, so much for planning. And we had a fantastic time at Cummins Building, Cummins India to what it is today. In 2003, there was this unexpected call from Microsoft of all people. I ignored all advice of friends and family who said ‘don’t do it, it is going to end badly’.
I think luck played a big role, timing is everything as you look back at your own life. I joined Microsoft at a time when the Indian economy was just beginning to its boom – 2004-2011. So I couldn’t have wished for a better time. So I think we had a pretty good time and great innings at Microsoft. In ‘2011 when I left (Microsoft), I was clear about only one thing, I will never again be an employee. So I am done with that phase of my life. But I didn’t know what I wanted to do. So I said, ok let me start by writing a book and many things came my way which turned out to be interesting – Infosys happened, Bank of Baroda came along, you did introduce me as Chairman of a public sector lender but that thing is a fairly unusual thing. I started a fund with some friends – Will Poole and Dave Richards and Srikrishna and we started Unitus Seed Fund which has done well. I started at Social Venture Partners in India which has also done well.
I just do things which seem to be important and interesting to me. So, it has been a fun ride and a rich life. When I look back, it turns out that every seven years forces converge and I ended up doing something radically different. In 2018, I am transitioning to new things, 2011 is when I left Microsoft, 2004 is when I joined Microsoft, 1996-97 is when I came back to India from the US. It’s been exactly seven years cadence but again I don’t think that is attributable to any plan, it’s just coincidence.
Pankaj: It’s great context, Ravi. It kind of sets the scene for us because you know it and I also spent a lot of time talking to people from across sectors. There is lot of paranoia, Ravi – software eating jobs and the whole automation thing. And I am not necessarily talking about the technology industry but you look at auto, you look at banking… all these sectors. Help me understand this deeper for the listeners of this podcast. No matter which sector they are, let’s look at this through the lens of employability, jobs because these are the questions people ask.
Ravi: I think something big is happening. One of the problems when we talk about jobs and employment is as Jayant Sinha said is ‘In India, we don’t talk with facts’. It is very hard to get good data, robust data on jobs and, hopefully, somebody is working on it. But what seems pretty uncontestable is the fact that one million people turn 18 every month and enter the so-called work force age and the amount of net new job creation that’s happening particularly in the formal sectors is negligible compared to this. So, we have rapidly mounting stress. A lot of it is not reflected in the unemployment figures because India is a huge problem with under employment which is people who don’t have jobs but in order to survive they are self-employed. So turns out, 46% of all people in the workforce are self-employed and the vast majority of that, 42% out of that 46% earn less than Rs 5,000 a month. This is a huge issue: unemployment and under-employment.
Now, you can also point anecdotal facts. You know, you drive in an Uber, you take a taxi, you talk to the office boy at work, you talk to the vegetable seller, fruit seller, very very often nowadays they will say, as soon as they find out, ‘Oh! You are associated with a bank or IT industry or whatever’, ‘Boss! Ladke ke liye kuch kardo ya ladki ke liye kuch karo’ (do something for my boy or do something for my girl). They have somehow taken a loan, sent their kid to some lowly rated engineering college or something, thinking they would eventually get a job in the IT industry and those jobs are not there and so these kids are sitting around without any prospects, there is a loan and, what is worse is, they now think ‘I am an engineer and I won’t do this kind of work which is beneath my dignity’ which in the past they might have. So you hear a lot of this anecdotal stuff.
Then you look at what’s happening across industries, you know, HDFC, which is a phenomenal bank, growing well. You know, last year they announced significant layoffs and they said this is because of digitization. L&T – again they are growing, they are doing well. Early last year, they announced layoffs. You look at the IT industry, the big five or six, they are growing at some reasonable 6-7-8% but the net employment in these is actually shrinking somewhere.
So, if you look at all this, it all adds up to a picture where we seem to be at an early stages of an S-curve or where automation is going to create jobless growth, at least for a period of time. Of course, over time they will create new opportunities as well but net employment is clearly an issue. And this is particularly hitting people who are, as they turn older. As you turn 40, you start getting into a Yellow zone and after 50, you are really in a Red zone when it comes to jobs because everybody prefers younger people, fresh with new knowledge, more eager to work maybe or ambitious and certainly paid a lot less. I think this is a big crisis which is building and we haven’t yet seen the full magnitude of it.
Pankaj: So if I am someone who is looking for my first job, looking to start my career and all I am looking around is chaos, I am like ‘I can’t make sense of automation, I can’t make sense of everything that is going around’. What is happening to me and what can I do?
Ravi: No, it doesn’t matter whether you are just starting out or you are 35 or your later stage 50 and thinking about second innings. I think there are few principles which I usually share with people. The first thing is ‘Hey boss! You better take charge of your career and your life because nobody else will’… sort of plagiarising Jack Welch’s old book from 20 years ago. But that’s really truer today than ever before. See for the last 20-25 years, we have had a rising tide that has lifted all boats, you know, I have been a beneficiary of it and all kinds of people have benefitted whether they worked hard or not. If you were reasonably interested in working, there was a job because of this rising tide, that rising tide has been going out for some years. And as Warren Buffet famously said, “It’s only when the tide goes out that you learn who has been swimming naked.” That means you now have to create your own current or your own tide, you can’t count on just broader trends. That’s one thing I would say.
The second thing I would tell people is, don’t think about a job and career. You need to as fast as possible get your head around the fact that you need to be self-employed if not an entrepreneur. Now, entrepreneurship is not for everyone but I think the faster all of us learn to recognise and be prepared to be self-employed, the better off will be. And so think about yourself even if you have a job, ‘I am just doing a gig and the gig might last four years and then I might do a second gig with the same company or same organisation’. Don’t get fooled into thinking you have a life long career. At any moment, you need to be prepared to be independent and stand on your own two feet. If you prepare yourself for that, I think you are going to have a much better sort of ride along the way. So think about yourself as self-employed.
The other thing is how do you search for a job etc.? Now, the metaphor I use is a mouse. Unless you are a cat, you don’t catch a mouse by chasing it down. What you do is put a trap out there with a bit of food, pakora, cheese or whatever and you wait for it to come to you. It’s the same thing with a job. The chances of you getting a good job by pursuing it are not so great. It’s far better to make yourself attractive and allow opportunities and jobs and all these things to come your way. You know what I mean. So, attract opportunity instead of hunting down chasing opportunity.
Pankaj: What makes it attractive?
Ravi: I will come to that. So right now, just putting out three or four principles.
Now how do you become attractive? That is a really good question. I think it is about three things. I have written about it actually. I wrote a New Year’s Eve post on Linkedin which was well received. It was called How to succeed in the new world? But I essentially talked about for instance, a winning attitude. Attitude really makes a difference. What is a winning attitude?
One is you really have drive and ambition to make something of yourself. Even when I met you 10 years a while, probably longer than that, I knew you were not just going to be an Economic Times journalist. You were burning with desire to make a mark and I think that’s a hallmark of a positive attitude. So, willingness to take initiative, take some risk, work really hard to make a success of your life. That’s a positive attitude.
The second one is you got to be an optimist. There is just huge evidence that optimists do better than pessimists. So you need be optimistic particularly in the face of setbacks, failures, disappointments, the ability to carry on and keep at it till you succeed, is important.
The third attribute of a winning attitude is willingness to take ownership and personal accountability. So many people, you know you see them in organisations or you see them just everywhere, they refuse to take ownership for anything. And they will do what is told and that’s it. This is not going to be rewarded in the future. A sense of entitlement is absolutely lethal in this environment. Nobody owes you anything and you are going to realise this pretty quickly. So I think that is important.
I don’t want to go on and on. But the set of positive traits is something you have to work on. And it is not something that you are born with. For instance, I was born slightly pessimistic, you know always saw the glass half empty rather than half full. Then I realised this is not a great way to live and it certainly is not a great leadership quality. So you work on yourself. There is a fantastic book called Learnt Optimism and that was my bible and so I worked on it for several years and today the needle is far more on the optimistic side. So, these are things that don’t just happen, you have to be aware of yourself and work out.
The second thing I think people need to work on is the right skill set. By skill set I don’t mean, for instance, today there are lots of jobs for people who understand big data or machine learning. Those are the hot jobs of today, tomorrow’s hot jobs, you know, who knows what they are and so I don’t mean that you should go out and get the skills you need to land a particular job. What I am talking about is, what are the skills which are likely to be timeless? They are as true today as they will be 30 years from now.
Pankaj: Is there such a thing?
Ravi: Yeah, I think there are three things which are timeless.
The first one is learning ability. HR guys talk about this a lot nowadays. They talk about learning agility. What is it? It says if a person is thrown into a situation that they have never seen or experienced, how quickly can they figure out what it takes to succeed? And that requires a set of skills which is quite different. Now this is actually a quality that you can test for and which you can also cultivate, it is like a muscle, the more you would do certain things, the stronger it becomes. But people who have learning agility tend to be curious, intensely curious about everything. They tend to like to read, they tend to like new challenges, and they don’t like very predictable things, they like ambiguous situations where they have to figure it out. So I think you recognize this in yourself and some other people and that’s the kind of people who are really going to succeed because no matter what you know today, in two or three years it is likely to be obsolete. The ability to forget and re-learn new things along the way.
So if you look at my own history. I am unusual only for one reason not because I have achieved anything particular. I have done many more different things than most people. I am one of the few people who has worked in the private sector, public sector, and the social sector. I have worked in five different industries, lived and worked in three different continents. Each time you take a risk and put yourself outside the comfort zone, learning happens and your confidence grows and this is how this muscle called learning agility develops. So, repeatedly throw yourself into a completely new situation and that’s how the neural networks in your brain form and your ability to then assimilate new things is basking enhanced. I think this is one of those horizontal skills that you can see will never be obsolete.
The second skill which is again going to be timeless is the ability to lead. I don’t care how much automation there is. There is always going to be people around. And the ability to lead them to do amazing things is a very precious quality. So I think somebody who has the ability will never have to worry about finding a job or being valuable. It’s one of the most precious things there is. What limits an organisation’s ability to grow and flourish? At the end of the day, frankly it is the number of leaders that they have.
Pankaj: Not the managers?
Ravi: It’s not managers. And leadership is not the same thing as people in positions of authority. It is the ability to inspire others to follow you to do something extraordinary. So I think, there is a set of things you do. Most people could be a leader. They have the latent potential but very few actually end up expressing it or harnessing it. And the first step that it takes towards becoming a leader is to take ownership for something. So we can get back to that if you want to unpeel it but I’d say, learning ability, leadership qualities and the third thing is the ability to manage yourself.
You know, again I have given quite a few talks on this. And people sometimes get little upset. The biggest obstacle to your success is you. Sooner or later we each become the biggest barrier to our own success and you have to learn to get out of your own way. And that’s what I call managing your own self. I mean if you look at what is when happening around the world, number of amazing people who have crashed and burnt because they did something incredibly stupid with poor judgment ranging from Rajat Gupta at McKinsey to many of the people who have been felled by the ‘me too’ movement including your good friend Mahesh Murthy. People who have otherwise got many skills and talents but they are not able to manage themselves and so they either burn spectacularly or else they never achieve the potential that they otherwise have. So, this is a very crucial quality. And what does it take? It takes high degree of self-awareness. ‘Hey, what are my strengths really? More importantly what are my weaknesses and how do I manage them?’ In my writings I have talked a lot about the metaphor of a giant balloon. Think about a giant hot air balloon which has a huge lift, that is your potential. You could be anything. You could rise very high. But this balloon is held down by thick ropes or chains and those chains are what – these are your weaknesses, these are your fears – your fear of failure, for instance, or it could be the malware in your mind, ‘Oh, I am 48 years old. Who will ever hire me? I am no good.’ You create these stories in our mind which are just self-limiting. These are those ropes. I think, people went up succeeding beyond luck are those who are able to see what’s holding them down and gradually unshackle themselves. So I think this is a hugely important skill, if you work.
So, as I said, in addition to specific competencies, sales or coding or whatever, you need to have these three fundamental building blocks: the ability to learn, unlearn, relearn; the ability to mobilise people; get them to do amazing things; and the third is most of all, the ability to manage yourself. So that you aren’t the bottleneck to your success. I think if you do this, success is more or less a given unless you are seriously unlucky.
Pankaj: From whatever little I understand from this, it looks like what we understood as traits seem to be becoming much far more important than ever before. People tend to confuse it with skills.
Ravi: Skills will come, skills will go, it’s a dynamic situation. But these are almost like character traits, these are attributes. They are foundational and lifelong.
Pankaj: Okay, if it is foundational and lifelong, how do you infuse this? They don’t teach this in schools.
Ravi: They don’t teach this in schools but that’s why you should be listening to your podcasts. There is nothing revolutionary in what I have said. I think everybody understands that the half-life of knowledge has been going down exponentially and, therefore, you better learn to learn. But when you actually interview people, it is shocking the lack of knowledge of what’s happening around, how little they actually read, how little curiosity they display, it’s just really shocking. You know at Bank of Baroda, one of the big things we have done is focus on identifying out of 54,000 employees, who are the handful of leaders who truly have the potential to take this bank into the future. And we started out and tested everybody and we came up with 2,700 people right from Scale 1 to General Managers who had reasonable potential. Then we put them through the leadership development programs. Half way through, now we tested them again. Only 20% of that group truly had leadership potential which included learning agility which means 1% of the total population, 20% of 5% i.e. 1% of a large pool truly has this. And you ask them very very basic questions and they don’t know, they haven’t thought about it. They are not unrepresentative of a broader population of educated professionals out there. This should be terrifying to them because they are just waiting for something bad to happen. So you said, how do you do this? You better recognise this; if you don’t, you are going to be an extinct species before long.
Pankaj: We are talking about individuals’ challenges but very strangely and it is very fascinating that it looks like these things apply to an organisation as well.
Ravi: Same old.
Pankaj: Yes, so let’s look at this whole thing through that lens like if you are a bank or an IT company and all, I mean as an organisation, do these things apply equally?
Ravi: They apply very much. So first of all, what should you do if you are a company today? I think the most important thing you need to realise is that you have to create a culture of learning where everybody is motivated to continuously learn new things. If you can’t do that, you are going to be very quickly stuck with an obsolete work force and then you have problems, you have to lay off, hire other people from the outside, they won’t fit into the inside, you have cultural in assimilation problems… we have seen this play out in many companies which means you can’t just hire bodies. In the hiring process itself, you have to look for these qualities, you have to look for this attribute called Learning Agility, you have to look for leadership potential, you have to look for self-awareness which is the first sign of somebody who knows how to manage themselves. So if you don’t test for these things, you are going to end up with some random group of people and then you have to deal with all kinds of problems.
Number 2: the most important thing you owe your employee is the opportunity to learn and grow. Okay. It is not the compensation. So how do you write from day 1, tell them, ‘Hey listen, take charge of your career, it is not your manager’s job, it is not the company’s job. We are going to create all these avenues for you to learn but it is your job to learn. The monkey is firmly on your back.’ I think that is something employers really need to get good about.
Number 3: huge investments in learning. That’s something we have to do. Without that, I don’t think companies are going to be able to navigate the disruptions that they are having in every industry. You can’t each time just go out and hire smart people, there is a limit to that and the biggest limit is you will end up with a really bad culture of mercenaries. And low trust. So you have to grow your own talent and the best way to do that is hire the right people and then go on investing in getting them to learn new skills.
So, yeah, I think there are deep implications for how you would run an organisation today versus let’s say 5 and 10 years ago. The game has changed, it’s moved on.
Pankaj: The other thing we keep hearing, Ravi: is entrepreneurship the answer to these troubles? Because, let’s say, if I am an employee and you are thinking of becoming an entrepreneur because I will be more in control. So sometimes, the trigger for entrepreneurship is getting a sense of control and from an organisation’s point of view, they say, we will encourage entrepreneurship. Is entrepreneurship overall an answer to these?
Ravi: See, I think there is no silver bullet out there. I think the solution to jobs, employment, and livelihood is a layered one. One important part of the solution is entrepreneurship. Two points I’d make. When we think entrepreneurship, we shouldn’t think just about the Flipkarts or whatever, I think we need to think about mass entrepreneurship which is people solving local problems and seeing that there is an opportunity to build a little local business. Think Padman, for instance. (Editor’s note: Ravi is referring to the character in the Padman movie, which is based on the real-life story of Arunachalam Muruganatham, the man who developed a low cost sanitary napkin.) Great example of somebody who saw a problem in his home, develops a solution that ends up in a wonderful, wonderful way. So, that’s one thing. Just because you started in life as a techie writing code, that doesn’t mean that you have to build a tech company. It can be any business.Recently, I have been spending a lot of time with a guy called Shashi Kumar. He runs a dairy business called AkshayaKalpa which supplies Bangalore with a lot of organic milk. Turns out he was a telecom engineer at Wipro for 20 years but he loves farming and dairy and he is doing an amazing job. So, entrepreneurship is not just startups as we think of it in Bangalore, it is solving problems with a business thing in mind.
I would say is entrepreneurship is not for everyone. So I think it is foolish to assume that everybody is capable of being an entrepreneur. I toy with entrepreneurship.
Pankaj: I wanted to ask you this…
Ravi: Back in 1999, an entrepreneurial bug bit me because I was making diesel engines and everybody from my college etc. were participating in the ‘dotcom’ boom. It was just before the dotcom bust. And I was feeling miserable sitting in Pune saying I am missing out on what’s happening. So I started a company but I didn’t have the courage to quit and go start on my own. So I started Cummins Infotech. And then the dot com bust happened and then we merged it with KPIT Info Systems and it became a great success.
But I realised then I am in intrapreneur, I am a risk taker within a large organisation, I am not really an entrepreneur. In 2011, when I left Microsoft, I toyed with the idea of creating a company that would sell cloud-based solutions to SMEs. So I had a nice team of ex-Microsoft guys and we had our business plan, everything ready, we had our investor and at the last minute I realised ‘Boy! Why am I doing this? Am I really passionate about it?’ And I realised I am not. I was doing this because I was caught up in the frenzy that was happening but I realised my real passion was elsewhere.
So I am just saying, it’s not for everyone and not everybody who even tries to be an entrepreneur is going to succeed. Only 20% will, 80%of startups actually fail. So it is important, it’s a hugely important thing for the country and the planet. But it’s only a piece of the solution.
That’s why I was truly thinking about self-employment. It is a huge part of the solution and that’s what I’d encourage people to think.
Pankaj: You have made a very important point when you were talking about your 2011 idea of doing a startup. I have discussed this before at one of the morning walks with you and you had some very strong arguments against it. Sometimes people get this realization midway like, ‘this is not what I should be doing’. Now how do you do that?
Ravi: How do you do that?
Pankaj: One is to not board the flight, another one is to abort the plane which is in the flight…
Ravi: First of all, I believe, I actually wanted to take a minute to say, we have talked a lot about jobs and things like that. I don’t think we should just focus on jobs. Reason we were born on earth is not to have a job. In fact, the late C.K. Prahalad – he was my mentor – told me once, ‘Ravi, there are only two moments that are important in a person’s life. The first moment is when h/she is born and the second moment is when you figure out why you were born.’ I don’t know if it was originally his or not, but I loved it, I never forgot it. So most of us are in a search whether we recognise it or not to understand why were we born, why were we put on this earth? The job is only a means to that end. Why we are here is actually to figure that mystery out, to make a difference.
Franklin D. Roosevelt – he talks about the joy of accomplishment and the thrill of creative effort. So I believe we should all be trying different things. Some things will work, some things won’t work. We shouldn’t be afraid of trying just because everything we try won’t work. So there is a little itch in your brain saying, ‘I want to become an entrepreneur’. I’d say, go for it, try it. And there is no shame in failing. I think we should redefine failure. I just realised before the investor gave me the cheque that I really wasn’t passionate about but let’s say I’d gone ahead and then flamed out. So what, what’s the big deal out here? You know, the cosmic scheme of these things don’t matter. What matters is that you live a fulfilling life, you figure out the way you are really going to make a difference and you look back at your life and have no regrets about it, by and large. So again, I want to shift away from jobs. Jobs at the end of the day is only a means to the bigger end.
Pankaj: Final question. Before we sign out, a lot of people are thinking what will Ravi do next?
Ravi: Good question. So am I.
Pankaj: And you talked about it. Every time you think of doing your next, what is that one thing that drives that decision making or is there one thing?
Ravi: No, actually, this is an exercise I would ask all your readers to do. Take a sheet of paper and make it into two columns. In one column, think of all the people who have been the biggest influence in your life. You’ll start out and you’ll say, my mother, my father, some teachers, somebody at work, somebody in life, hopefully, your spouse, whatever. You write this down. By the time you are 54 years old, it will be 15-20 names. On the other column, think about the defining experiences in your life and again there will be some 10-15 of them that you can think about. And then, each time look at each one of these and say how did this happen? Did it happen because I chose, I made it happen or did it enter my life, did this person enter my life, did this experience enter my life? I can look at my list and say about 95% of both the experiences as well as the people happened not because of me, they entered my life.
And so here we are having this delusion that we make things happen, it is our decisions, our choices. Nonsense! I think you do your best, you prepare, you work on your learning ability and leave it and then opportunities enter your life. You should only be aware and smart enough to recognise, ‘Oops! There is a beautiful one’. So I look at all the things that happened to me professionally whether it was Cummins, whether it was Microsoft, whether it was the book project, whether it was Mr (Narayana) Murthy asking me to join Infosys, Raghu Rajan asking me to join Bank of Baroda, SVP the fund, every one of them entered my life not something I chose and decided to do. When you are young you believe that everything happens because you made it so. As you look back at your own life, you realise many things happen for reasons way beyond your own decision-making.
So what I think is going to happen now is the right opportunity will enter my life and I hope I am aware and smart enough to recognise it and say ‘that’s the one’ as opposed to things which are not really meant for me.
Pankaj: I think this also connects with what you said about becoming attractive.
Ravi: Correct. You make yourself attractive to others and the opportunities will come your way. That’s all you can and should do actually. In my life whenever I pursued opportunities, I found that the door was locked and then magically some other portal opened and it was a pathway to a beautiful future. So, that’s the advice I would give.
Pankaj: Godspeed Ravi. I mean I can’t wait to learn more about what it is.
Ravi: You don’t have to wait long. I am writing a book about all this. It’s called What the heck do I do with my life. It is aimed exactly at these kind of questions and so hopefully by the end of the year I’ll have somewhat readable book.
Pankaj: Lovely talking to you Ravi. Thank you so much
Ravi: Thank you.