AM Naik: The man who built tomorrow

The book written by Priya Kumar and Jayaram N. Menon has successfully shed light on some of the characteristics of such a celebrated, illustrious and versatile personality, that AM Naik is. This book will not only provide deep insights for today’s leaders but also for young, aspiring managers, in shaping their careers!

Naik, a Padma Vibhushan awardee, has led the company from a turnover of ₹5,000 crore in 1999 to ₹1,83,000 crore in 2023. During the same period, the company’s market capitalisation climbed from ₹4,000 crore to around ₹374,000 crore. Ninety-two percent of L&T that we see today did not exist in its current form and size before Naik became CEO in 1999.

From his apprenticeship his ‘grit’ had branded him as a ‘go getter’, which charted his journey up the organisation. His ability to feel the pulse of the workers and unions is legendary. He demonstrated the ability to balance between being ‘determined’ and ‘fair’ and ‘cracking the whip’ when necessary.

At the same time, building long-term relationships with the workers on the construction sites and shop floors on a personal level became his trademark, a rare quality.

Very rarely do you see a young rising manager being chosen to handle a complex political situation and that too with political leadership of people like Balasaheb Thackeray and more so to do it successfully and protect the interest of the organization! His ability to negotiate and influence internal and external stakeholders is seen as unique!

By the late 1980s, L&T had emerged as one of the most respected engineering companies in India’s corporate sector, but at the same time the company was also becoming vulnerable to hostile takeovers.

Corporate raiders and big business houses jumped at the chance to take control of L&T. Naik along with the team played a key role in preventing such a takeover, preserving L&T and its independence by launching a vigorous campaign to influence the bureaucracy in New Delhi and successfully averting the crisis.

A former boss of Naik’s says he is a ‘running’ thoroughbred horse. Watching him work can sometimes exhaust the viewer! Another colleague of his said: “He has so many good qualities that it is easy to pick the ones that suit you best. You can be a part of him, but never the whole.”

Bigger idea of ​​India

Naik’s passion for the country preceded his love for the company; he never saw L&T as a company but as a larger idea of ​​India! Great leaders have a ‘purpose’ that goes far beyond their personal success! The timeliness of his decision making and the courage that went into such decisions have become legendary today; there is nothing grey, there is always a clear decision, black or white!

L&T’s recent acquisition of Mindtree and its merger with L&T Infotech in 2022, which now creates a USD 5.6 billion information technology giant and one of the top six technology services players in the country, has also left a legacy.

Naik’s vision of the importance of technology companies was already visible in 1999, when he took charge as CEO. He was personally interested in scaling up the IT sector by developing a new and powerful system of ‘barter’.

When he approached large international companies to deliver infrastructure projects which he offered, he would beg, cajole and use the brand name L&T, where L&T would offer to deliver software services through its L&T Infotech team. In this way, he steadily secured software contracts for L&T Infotech.

One of his colleagues said that within minutes of the meeting with the chairman of Kuwait National Petroleum Corporation (KNPC), Naik had a feeling that L&T would not get the turnkey contract.

He immediately changed tack and started talking about the IT business; he began with “Let me tell you frankly,” Naik told the KNPC Chairman, “Your IT systems, as they are, look outdated. Let me send my IT team and help you modernize.” Such was his passion for cross-selling to promote L&T and other group companies!

Naik’s visible passion and deep commitment leave a lasting impression. Facts and figures about L&T become fluorescent in Naik’s narration. Even if he has had ten meetings in a day and another meeting is coming up, he will explain it with even more passion the eleventh time, says L&T Chairman and Managing Director SN Subrahmanyan!

The size and scale at which L&T operates today is the result of a change in mindset within the organization. When the rest of the company was talking about projects worth around ₹10 crore, Naik shook them up with a target of ₹100 crore; today the targets are much more than ₹1,000 crore.

Naik was an early advocate of actively promoting the internationalization of L&T’s business by benchmarking against the best in the world. To operate in markets like the Middle East required a complete change of mindset

Naik’s networking ability is phenomenal, says Subrahmanyan. It may seem like he’s met everyone on Earth, and everyone on Earth seems to have met him. His ability to create such an extensive database of contacts is driven by two basic characteristics.

He is genuinely interested in people and is insatiably curious. With a smile, Naik starts with standard questions like ‘who are you’, ‘what do you do?’ Then he wants to know everything about the person, his family, where he went to school and what his goals and interests are.

His question sometimes crosses conventional boundaries and becomes personal, but no one minds. Such information that he gathers, he will use to paint character portraits of people in his mind and he will never forget such details.

Building deep connections

He reads people like a person reads a newspaper; a few minutes is all he needs to judge a person, figure out his characteristics, learn his strengths and weaknesses. He sees more in the person, than the person in himself!

Often, it only takes one meeting and a handshake for Naik to sow the seeds of a warm friendship. He leaves such an impression on those he meets that he is rarely forgotten. And most importantly, he builds connections when there are no problems to solve and no gains to be made!

As they say, the most important role of a leader is to have a successor ready before he hangs up his boots! We all know that even legendary leaders like Narayana Murthy of Infosys, AG Lafley of Procter and Gamble, Michael Dell of Dell computers or Howard Shultz of Starbucks, all had to come back from retirement because their succession planning was flawed.

Naik got it right the first time. The leadership transition at L&T in 2023 to his successor Subrahmanyan was one of the most structured transition processes resulting in the smoothest business successions in Indian industry.

Naik’s ability to create a ‘shared vision’ within the team is unmatched. One of his senior colleagues explains, “We know our worth, we are gold medalists – the best, we are constantly getting offers and invitations to be poached, but why do you think people like us have stayed with the company for 40 years? Because Naik has an invisible glue that makes employees stick with the company even though they have different views!”

Subrahmanyan describes the yardstick Naik used to assess talent; this will be valuable to aspiring managers and leaders. He looks for leadership, the ability to present yourself well, articulate well, and speak sensibly.

He focuses on people with a certain vision and direction. You have to be sure of yourself and stand your ground, because he will see if he can push you easily! He will ask you questions about the market, the competition, about people and will assess your networking ability.

You have to be good with numbers because he can suddenly ask questions about market share and profit after tax! Once you get it right, Naik likes it and his feelings are visible!

Naik was one of the first to redefine the role of the Human Resources department and emphasize it as a driver of organizational capabilities. L&T’s ‘Seven Step Leadership Program’ and the L&T Leadership Development Academy (LDA) in Lonavala were set up to train and develop the next generation of strong leaders.

Naik always believed that it was an important responsibility of every citizen to give back to the society. He walked the talk and his contribution in setting up hospitals, technical training centres and schools on a large scale was exceptional.

Naik is a true nation builder in essence and is one of those rare people who have a ‘bold’ vision and also have the social skills to create a shared vision so that his vision can be successfully executed. A life that truly inspires young managers!

(The reviewer is Distinguished Professor, Great Lakes Institute of Management, Chennai)

View the book here