Sumantra Ghoshal

Sumantra Ghoshal (born September 26, 1948 in Kolkata , India , † March 3, 2004 in Hampstead , United Kingdom ) was an Indian economist , co-founder and founding dean of the Indian School of Business in Hyderabad and holder of the Robert P. Bauman Chair for Strategic Leadership at the London Business School .

Life

Ghoshal graduated in physics from the University of Delhi , moved to the Indian oil industry, where he rose in management until he went to the USA in 1981, supported by the Fulbright program . He was completing two doctoral theses at the same time and received his first doctorate from the Sloan School of Management at the Massachusetts Institute of Technology and a second shortly thereafter from Harvard Business School , where he also met his future co-author, Christopher A. Bartlett . In 1985 he moved to INSEAD in France , where he quickly received a full professorship , which he held until 1994. He then took on a professorship at the London Business School , where he taught until his death. Outside of university, Sumantra Ghoshal worked as a consultant for industrial companies worldwide. He died in 2004 of complications from a cerebral aneurysm at the Royal Free Hospital in Hampstead, UK.

Activities / services

Sumantra Ghoshal dealt primarily with the strategy of internationally active companies . In his opinion, large corporations are possibly the most important social and economic institutions of the modern age , as this is where progress takes place.

“This is a belief that business and, by implication, both entrepreneurs and managers, are the key engines of both economic and social progress. It is business that creates and distributes most of an economy's wealth, that innovates, trades and raises the living standards of people. So business is and must be a force of good [...] ”

“It is the belief that the business world - and consequently investors and management - have become the engines of economic and social progress. It is the business world that generates and distributes most of a country's wealth, that invents, acts, and increases people's standard of living. Therefore, the business world must be a force for good [...] "

- Sumantra Ghoshal : Quoted in his obituary in Business World, March 15, 2004

In Managing Across Borders: The Transnational Solution , which Ghoshal wrote with Christopher Bartlett, the two examine the structures of internationally operating companies. They find that - despite the relatively similar starting position - different companies have successfully made the switch from national to international companies, while other, similarly well-positioned competitors were unable to do so. They divide the successful companies into three categories, multinational , global and international . Across industries they represent it within the groups common skills (capabilities) determines that its expression in the organizational structure found. The main features are summarized in the following table:

	Multinational company	Global company	International company
Essential competence	Responsiveness	Efficiency	Knowledge transfer
Structures	Loose Federated National Enterprises; National companies handle the entire operational business and parts of the strategic tasks	Firmly centralized companies, national companies, have primarily distribution tasks; Strategy and most of the operational decisions at headquarters	Located between multinational and global companies, certain strategic departments are central, others are decentralized
Examples	Unilever , ITT	Exxon , Toyota	IBM , Ericsson

Simultaneously with the observation of these structures, Ghoshal and Bartlett also recognize that these structures no longer meet the requirements of the market. Customers demand the diverse products of multinational companies at prices that can only be supplied by global companies. The business environment of internationally active companies is changing ever faster. In this environment they develop a fourth form of company that no longer only has to master one key skill, but all three at the same time. They call this form the transnational enterprise as the ideal type to which the other forms must develop if they want to remain globally competitive.

Instead of a center or small federal centers, the solution provides a network that combines the advantages of both structures. Individual functions can be concentrated in the home country and others (e.g. production ) relocated to other countries. In the long term, the home country will also lose importance and continue to exist as an equal market alongside the others. The designation is derived from this (transnational = beyond the national market).

In his posthumously published writings, Ghoshal takes a critical approach to modern management. According to his presentation, the task of management as vicarious agent of the investors is wrong. It is not the investors who take a risk when they invest in a company, but the employees who invest their skills and knowledge in a company. If investors are not satisfied with the company, they can easily pull their money out of the company, while employees, on the other hand, cannot move their center of life to other countries within hours. From this point of view, they appear to be the actual risk carriers. Ghoshal sees it as problematic that managers are often not aware of this role or shy away from the consequences of the responsibility arising from the role. For social reasons, Ghoshal believes that it is high time managers became aware of this role. Furthermore, the huge organizations run by these managers need to reinvent themselves in order to continue to drive progress in the future.

At the core of his ideas is a change in values from money to the human ability to create value . Here Ghoshal considered this human capital (human capital) not only as the sum of the skills and knowledge of individuals, but also includes the so-called. Social capital (social capital) one that arises from the relationships within the company, as well as the so-called emotional capital ( emotional capital) , which consists of the motivations and emotions that dominate human pursuit. In his opinion, it is no longer sufficient to regard employees as a factor of production . Rather, they should be treated like investors in their skills and talents.

Like Henry Mintzberg , Ghoshal sees responsibility for development in the modern MBA course . However, he died before publication, his thoughts on the subject will remain unfinished.

"By propagating ideologically inspired amoral theories, business schools have actively freed their students from any sense of moral responsibility."

"By spreading ideologically inspired, amoral theories, business schools have actively freed their students from any sense of moral responsibility."

- Sumantra Ghoshal

Works

• With Christopher A. Bartlett: Managing Across Borders: The Transnational Solution . 2nd edition 2002, Harvard Business School Press, 1989, ISBN 1-57851-707-9 .
• With Nitin Nohria: The Differential Network: Organizing the Multinational Corporation for Value Creation . Jossey-Bass, 1997, ISBN 0-7879-0331-0 .
• With Christopher A. Bartlett: The Individualized Corporation . Collins, 1999, ISBN 0-88730-831-7 .
• Managing Radical Change - What Indian companies must do to become World-class . Viking, 2000, ISBN 0-670-89677-2 .

Web links

• Literature by and about Sumantra Ghoshal in the catalog of the German National Library

Individual evidence

1. ↑ London Business School: Short biography ( memento of the original from December 25, 2005 in the Internet Archive ) Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice. 
2. ^ The Guardian : Obituary , March 8, 2004
3. ↑ Calcuttaweb.com: NRI Profile ( Memento of the original dated November 1, 2006 in the Internet Archive ) Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice. , May 2004 
4. ^ C. Bartlett & S. Ghoshal: Managing across Borders: The Transnational Solution . Quoted in: Susan Segal-Horn: International Strategy: Competing Across Borders . Open University, ISBN 0-7492-9274-1 .