Kautilya: The worlds first management guru and strategist

Dr. Sharda Nandram Amsterdam, Sept 2010: Averaging a growth rate of 6% a year since 1991, India has become one of the hottest growth stories of the world. Blessed with an educated, entrepreneurial work force, and a population with a median age of 25 years, which drives growth as well as forms a large consumer base, India is touted as the next economic superpower, along with China. However these achievements are the result of following a Western model of development. To maintain a lasting competitive advantage and differentiate itself from China, India needs to go back to its core, its authentic roots so that its strategy will not be imitated by others. India needs to go back to its spiritual leaders, philosophers, scientists and visionary leaders to re-examine their teachings and their applications to the modern day, knotty problems of growth and development. Netherlands, on the other hand, a small country of 16 million people and 20 million bicycles, has 48% of its workforce in part-time employment. Though Netherlands is one of the top 10 countries on the scale of global competitiveness, like all the European countries, it is grappling with how to increase wellbeing amidst excess. The teachings of Kautilya, also known as Chanakya and Vishnugupta, have significance for both these countries, India as well as Netherlands, though both are at different points of a growth curve. Kautilyas work was encapsulated in the book Kautilyas Arthashastra; the way of financial management and economic governance published by the Priyadarshini Academy in 2009. It is now available in Dutch as a joint effort of Praan Solutions, Multilibris and Priyadarshini Academy. Kautilyas management teachings Kautilya lived from 350-275 BC. A great political strategist, economist, educator and an expert in diplomacy, his teachings needs to be rediscovered even in India. He had a holistic approach for societal problems, education, economics, governance, business and financial management and was the man behind the rise of Chandragupta, the first Mauryan Emperor. With his successful Mandala strategy, Kautilya slowly chipped away at the edges of Nandas kingdom, instead of attacking it directly. Nanda was the corrupt yet powerful king of Magadha. Kautilya was able to withstand the challenge of the Greek invaders by building alliances with the small kingdoms. With his time management approach, Kautilya defined a daily routine for the King. He allowed the King ten and half hours as his own time, the rest he needed to spend on his duties towards his subjects. The Mandala strategy, building alliances and time management are all tools that can be useful in governance and management. Furthermore, Kautilyas view on leadership departs from a holistic view. Though he did not talk about management in the terms of holism, it was built on deeper human values that increase the connection between citizens and their leaders. According to Kautilya, the leader should study four branches of knowledge: philosophy, scriptures, economics and politics because these are the basics for training in spiritual welfare (dharma) and material wealth (artha). In his monumental

work Arthashastra he talked about combining both because one was unsustainable without the other. Therefore one can say that the essence of the Arthashastra is a framework for building wealth, welfare and wellbeing. In the daily routine that he prescribed for the King he allocated time for meditation. In essence Kautilyas leadership principle focused on finding a balance between the inner self and the outer world, the balance many managers are lacking today. Managers, these days, are seeking tools to find this balance. The Western mindset is predominantly macrocosmic; these managers are interested in understanding their mind, behavior, attitudes, surroundings and society at large. A Western approach to mindfulness therefore focuses on understanding and optimizing the minds functions to help individuals achieve success and happiness. The East traditionally holds a more microcosmic worldview, which translates to an interest in mans inner relationship to himself and to his spiritual core. Kautilya was able to integrate the macrocosmic with the microcosmic making his perspective holistic. Furthermore his focus in leadership was on understanding the outer self and aligning it with the inner consciousness. Another element of his teachings is the value based approach that the leader should take. This concept nowadays can be found in the discussions of corporate social responsibility. Kautilya stressed the importance of learning and acquiring the right skill to be an effective leader. Self purification and inner cleansing were necessary for the right perspective. He warned against excess and inactivity. He mentioned values which a leader should possess; truthfulness, reliability, promptness, freedom from vices (lust, anger, greed and vanity), long term vision and respect for the advice of elders. The essence of leadership lies in the ethical foundations. I believe all these concepts make Kautilya the worlds first management guru. Kautilyas teachings on governance The concept of good governance gets a lot of attention in Western society especially in current times. The Arthashastra is a manual for practicing politicians. Kautilya prescribed specific, tested administrative procedures. An important part of that was coercive authority (danda, which literally means a stick) when officers do not meet their task or if citizens not obey the rules and regulations. He conceived danda to be the surest and the most universal means of ensuring public security as well as the stability of the social order. He contemplated the universal application of danda irrespective of the offenders rank and status. He was aware of financial fraud committed by the government officials. Government officials could enrich themselves either by cheating the government or by exploiting the public. He prescribed punishment for both types of fraud. If Kautilya were to be alive today, he would penalize all the players of the 2008 financial crisis, the financial institutions, governments and CEOs of corporations, who failed to follow the ethical rules of governance. Profit was a must in his scheme of running public enterprises. An official who did not generate adequate profits in crown undertakings was punished. Kautilyas theory of the recruitment and selection of officials involved tests to judge officials before appointing them. According to him the civil servants needed to be watched and guided so that they did not misuse their position. The candidate who applied for a position was tempted by different means through secret agents. Kautilya developed the wealth tests, the virtue test, the pleasure test and the fear test. Those who passed all four tests were appointed as ministers. The

Arthashastra explains in detail the principle of righteousness in management, politics and stated it to be the essence of being a King.

Kautilyas teachings on education Kautilyas Arthashastra stressed the importance of education. He stated that teaching wrong things was a great crime. Learning results in righteousness and wealth. In his opinion, training and learning destroyed unrighteousness, poverty and hatred. Along with the varied sciences, the student was urged towards discipline and self-control. Thus it was a combination of intellectual skills and yogic discipline. Not everyone was capable of the type of discipline he valued as important for education. Therefore he stated that the lessons of discipline could be imparted to those who had the desire to learn, capacity to listen attentively, power to grasp what was taught, retain it in memory, discriminate between the important and the unimportant, draw inferences, deliberate and imbibe the truth. Kautilya stated that sciences should be studied and their precepts strictly observed only under the authority of specialist teachers. Students stayed at residential schools called Gurukuls. Animals were regarded as a part of the same cosmos as humans, therefore there was veterinary medicine. The average citizen and villager were expected to defend their own hearth and home, therefore there was military training. Trading with other countries was profitable. Therefore there was commercial education. Statistics was one of the main subjects. Data was collected in agriculture but also for marking animals for categorizing. Besides the intellectual learning the Arthashastra stressed moral education and character building as essential for education. Relevance of Kautilya to the Dutch society Currently leadership and trust-building are the main issues in the Dutch political arena. The last election in June this year did not result in a clear cut decision. The former government fell because of a rift between the Labour and the Christian Democrats over the deployment of Dutch troops in Afghanistan. Even after three months there is no new government because of the difficulty in forming a coalition between the liberal and the labor party. The number of seats together is not enough and they need to find other parties to join in. Several options have been tried out so far but without success. In need Kautilya formed strategic alliances with the enemy. The politicians should learn about forming alliances to realize what is good for its citizens. Kautilyas teachings would suggest clear leadership with service to the citizens and discipline of the leaders towards efficiency and wealth management. His Mandala strategy would be helpful in first approaching the edges of the programs of the political parties involved. This should be followed by discussing and negotiating the core of the political programs. Starting with the main differences tends to only enlarge these differences. Starting with the less important issues or the similarities will have a positive impact on the process of forming a government.

About the author Sharda S. Nandram, a Dutch resident, was born in Surinam, and is the third generation living abroad, from Indian origin. She has two masters degrees to her credit. One in Work and Organizational Psychology at the University of Amsterdam and the other in General Economics at the University of Amsterdam, The Netherlands. She completed her PhD in Social Sciences at the Vrije University of Amsterdam. Sharda Nandram has worked for universities and research centers conducting applied and academic research for nonprofit and profit organizations. Sharda Nandram is Professor Entrepreneurship at the University of Applied Sciences HAN and Associate Professor at Nyenrode Business Universiteit within the Center for Entrepreneurship. She has her own consultancy Praan Solutions. Sharda has published several articles, chapters and books on these topics and she has presented her work at international and national conferences. Besides her professional responsibilities she is Co-chairwomen of GOPIO (Global Organization of Person of Indian Origin), Member of the steering Committee of the European Society of Spirituality and Economics based in Belgium, Trustee of the Foundation for Critical Choices for India (FCCI), a Think Tank of Indian Diaspora in the Netherlands. Sharda is married and has two children. She has been living in the Netherlands for 25 years. Contact:

sharda@praansol.com 0031-641403325 Priyadarshniacademy@gmail.com 2222049315 (Mumbai)