Historical/ Social Factors Influencing Indian Society The caste system: evolved from a composition of interdependent occupational groups

to a stratified, hierarchical, socio-economic class system Legacy of British Colonization The British colonization left a legacy of administrative bureaucracy and cleavage between leading and non leading groups Post-Independence Socialism The development goals behind the socialist ideology led to the protectionist economic situation that dominated until 1991 - beginning of challenge to values of Karma and Caste system due to social change and education Post-1991Economy and Society Rapid change, Competition & achievements further challenged traditional shared values (Karma & Caste) Philosophical/ personal, shared values: Factors Influencing Indian Society Karma predestination Humans are unchangeable and shaped by past life activities Impassive and impersonal outlook of pain, suffering and poverty Preordination of one's life events No mastery over nature and destiny What is unfinished in this life can be continued in the next Emphasis on heritage and tradition Lack of urgency, preference for tried-and-true Current time cycle is not worthy, predominance of evil Dharma social duty Admiration of ascetic contemplators over doers Motivation through duty to one's life roles and family Traditional Influences at the Workplace Fatalism at work (nothing can be improved) Lower persistence and ambition Scepticism towards innovation, the future Lack of sense of urgency and planning time Ambivalent attitude towards material success Conformity, dependence, seeking approval over initiative, creativity, independence

Traditional Indian Management in Comparison Management Practice Employee Requirements Leadership Style Western Management Task requirements and abilities Traditional Indian Management Family relation and caste memberships of employees have to be considered Organizational leaders display a high level of personal involvement With their subordinates. Leaders provide nurturance contingent upon the subordinate's task accomplishment Work is viewed as a means to an end i.e. for the sake of satisfying family needs. Little demand for changing work tasks, only the compensation is relevant Nepotism and caste considerations affect selection and Compensation. Training less emphasized

Participative management style where input is solicited / Relationships remain impersonal

Motivational Aspects and Rewards

Work an end itself / Intrinsic rewards

Human resource management practices

Objective selection criteria Downsizing, performance pay

Changing Environment After 1991 Opening up of the Indian Economy > Before 1991 protected economy and import of certain goods was restricted > After 1991 competition increased tremendously after the liberalisation. Competitors from all over the world enter the Indian market Competition from Low Wage Countries > Low range products are floating into the market > Low price, low quality Environmentalism and the Growing Importance of Stakeholders > As the economic status of the people in India increases, aspects such as environmental issues are increasingly addressed

Reaction from Local Firms to the Changing Environment Innovation and Customer Focus > Trend: solve a customer problem holistically rather than just selling a product Education of the Customer > As a result of increasing competition and increasing supplies customers are increasingly educated and demanding Sourcing > Insourcing > Centralisation Healthy competition seems to be one of the main reasons that pushed local competitions to increasing professionalism The external factors strongly influence the speed the relevant companies have been transforming Challenges for Local Indian Firms With growing competition from professionally managed businesses, local firms and especially family businesses are left with no other option but to turn to professionals In order to survive local firms have master the challenges > Separate professional matters from family interests > Focus on core businesses > Become accountable for shareholders Each firm has its own transformation but the importance is the end result > Professional controlled company > Integration into the global economy > Compete successfully with other companies Indian firms would not be where they are today, if they had not transformed into professional organizations Areas of Change Globalisation of Competition and Markets Mobility of Professionals and Internationalization of Salaries Professionalisation of Human Resources Systems Urbanism and Centralization

Evolution of Indian Management Management Practice Employee Requirements Leadership Style Traditional Indian Management Family relation and caste memberships of employees have to be considered Organizational leaders display a high level of personal involvement With their subordinates. Leaders provide nurturance contingent upon the subordinate's task accomplishment Work is viewed as a means to an end i.e. for the sake of satisfying family needs. Little demand for changing work tasks, only the compensation is relevant Nepotism and caste considerations affect selection and Compensation. Training less emphasized Contemporary Indian Management Relevant educational background and experience matching task requirement Increasingly participative management style where subordinates' Opinions and input are solicited. Personal relationship between management and employees reduced Elements such as job rotation, enrichment, autonomy, team work and competitive salaries are increasingly considered to motivate employees Objective selection criteria. Training programs and performance Related compensation applied.

Motivational Aspects and Rewards

Human resource management practices