Friendship as the Foundation of a Firm: A Hypothesis of Enterprise Genesis and Growth

Friendship driven entrepreneurial activity certainly requires meritorious capabilities but does not necessarily require working together in the same corporate format. Professionals who have done well in their careers can support their friends in different domains and fields to establish and grow their distinctive businesses. Friends who have investible resources could become business mentors and angel investors and let their friends become businessmen in their own domains. On a different but an increasingly relevant plane, fellow professionals in business and organizations could reject the temptation of misplaced personal loyalty to leaders and instead exercise a transition to genuine friendship by building sustainable value for the organizations.

India is widely recognized today for the great talent that graduates from its educational institutions and gains professional experience in the industry and business. Synergizing these skills through friendship, at any stage of life, would enable the great Indian talent discover its true potential with risks of novel enterprise insulated by the strengths of friendship. Friendship, spontaneous and ethereal in nature, would trigger challenging but enduring projects that they would all enjoy doing. Over time these would grow into meaningful and innovative enterprises that will leave behind something of value, with an institutional stamp of friendship for the future, creating value for the society and the nation.

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Exit Cross-functional: Enter Cross-industry

Organizational structure is both the boon and bane of corporate development. Without organizational structure, management would be chaotic and even impossible. With organization structure, management is constrained, and even thwarted by silos. Organization experts have tried to configure several models of organizational structure - functional, product, geographic, project, matrix, congruence, strategic business to name a few - to make organizational structures support efficient and effective realization of corporate goals. As companies diversify and globalize on multiple product-market dimensions, structural and process challenges of organization design become more intense.

Whatever be the nature of business and the type of the organization however, departmental configurations perpetuate themselves into structural silos. Functions, domains, businesses or any other part of value chain of any organization turn into structural silos. As leaders of functions, domains and businesses compete to grow in an organization, silos become even more obdurate and ossified. Organization experts have tried to configure solutions by advocating cross-functional management as a process approach to break silos. In today's fast changing technology space and competitive world, however, it is no longer sufficient to have solutions that attempt to merely overcome self-inflicted organizational problems.

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Successful CEO Succession: Model of Continuity with Change

India's Tata Group has demonstrated, independent of Western management thought and practice, for several decades that Indian entrepreneurs and professionals of the Group can create a world-class conglomerate. Tata leadership model had inspired national economic endeavours with an unflinching social purpose. Ratan Tata's growth model based on change with continuity is an eminently commendable model for effective succession management. It had under the overarching umbrella of Tata vision with values the following: reinforcing core with divesting non-core, leadership consolidation with professionalization, business growth with ownership security, globalization with acquisitions, and innovation with competitiveness.

It is a moot point whether the successor to Ratan Tata would follow, or would need to follow, the business strategy established by him in a rapidly changing global environment. Whether the successor would need to discover new core businesses such as clean and alternate energy generation, aerospace and satellite businesses, infrastructure building and management, healthcare and life sciences, and in doing so would need to adopt different strategic planks is a matter for the future. What can be certainly predicted is that the Tata Group would continue to aim at conglomerate leadership with social trust, and the successor to Ratan Tata would achieve success by following the proven succession model of "change with continuity".

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