Mind Without Fear

by Rajat Gupta

  I pressed ahead with the next critical piece: the search for a dean. I had hoped that Dipak Jain from Kellogg would take on the role, and initially he agreed to a co-deanship, but then Don Jacobs was taken ill, and Dipak stepped into his shoes at Kellogg, eventually being tapped to succeed Don. He felt terrible letting us down, but it was not an opportunity he could pass up. I was happy for him, but disappointed for ISB. Sumantra Ghoshal had offered to take on the role of dean, working with Dipak, if he could divide his time between ISB and London. His name would give us the credibility we were seeking, even if his part-time status wasn’t ideal. However, just months before our planned opening, he too withdrew, saying he felt his skills were unsuited to being an administrator. Nothing we said would convince him.

  There simply wasn’t time to find another reputable academic ready to make the move. With that off the table, there was clearly one man who knew ISB better than anyone: my McKinsey partner Pramath Sinha, who’d been acting as CEO. Pramath had a PhD from the University of Pennsylvania and was at heart an academic. I sat down one day with him and his wife. “Look, Pramath, I think at this stage you have to do it.”

  Pramath looked surprised, but understood that he was the only logical choice. “You’ll have to convince my wife, though,” he told us. In the end, she agreed, and I persuaded Pramath to take a one-year leave of absence from the firm, just until we could find a replacement. He would be well supported by deputy deans Savita Mahajan and Ajit Rangnekar, and I breathed a sigh of relief. At least we would not be opening without a dean.

  We might, however, be opening without a roof. Construction was moving with typical Indian slowness, hampered by heavy monsoon rains. We had broken ground at the end of 1999, and our opening had been moved from its initial date of summer 2000 to June 2001. Still, it was an ambitious timeline; when I visited toward the end of 2000, I was alarmed by how far behind schedule we were. Would we be forced to compromise on the vision of a world-class facility in order not to miss our deadline? I sent a strongly worded letter to the head of the architectural firm, and the board decided to push back the opening one more month, to July 1. Then it was just a race against time, but the team pulled out all the stops.

  This was just the first of many twists and turns in the ISB story. At every step, we were told it couldn’t be done, and we surprised our critics with creative and counterintuitive solutions. People said it could never be done in India, but we found ways to bypass the bureaucracy and stay independent. They said we couldn’t run a business school primarily with visiting faculty, but we made it work, attracting the cream of the world’s business talent to teach our students. They said it would be impossible for us to attain university status, but we proved we could be successful without it. They said our fees were too high and we could never compete with the government-funded IIMs, but we came up with an innovative system of student loans to make it work. They said our executive education program, critical to the school’s cash flow, would fail after 9/11, but we launched it successfully and it soon became the biggest in the country. They said our one-year MBA program would be viewed as second-rate, but in the spring of 2001 we received more than 1100 applications and admitted our first 128 students.

  On July 1, we opened our doors. Thanks to the enormous efforts of a veritable army of workers and volunteers, we were ready—or at least ready enough. There was still scaffolding in the atrium where we held the ceremony, which had to be artfully disguised. But the campus was stunning, with its striking pink stone buildings, its clean modern lines with subtle nods to the area’s Mughal architectural heritage, and its vivid green lawns. Inside, the facilities and technology were state of the art.

  Once the school was open, our principles continued to be tested. Our admission system was “needs-blind,” meaning no one had to disclose their ability to pay on their application. We would accept people on their merit and then provide them with scholarships and loans if needed. We worked with the banks to set up student loans that would accept our diploma certificates as collateral, removing that burden from students’ parents. We refused to allow interference in the admissions process from any of our board members or donors seeking special dispensation for their friends and family members.

  This was important to me. I’d been on the boards of many educational institutions over the years and had often been asked to intercede on behalf of a friend or family member’s son or daughter seeking admission. Similarly, I’d often been asked to help with job applications. I’d thought long and hard about how to approach such moments. I believed in meritocracy and didn’t want anyone to get ahead simply based on their connections. However, I also didn’t like to deny people my support. One such case that I’ll never forget involved my younger brother’s son. After graduating Princeton, where he’d been accepted without any help from me, he wanted to work in the Teach for America program. I happened to know the founder, and my brother asked me to write to her in support of his son’s application. I did so.

  A week later, I got a call from my nephew, who was irate!

  “Uncle, I want you to retract the email. I don’t want an unfair leg up.”

  His father clearly had not consulted him before making the request.

  “I appreciate how you feel,” I told him. “But read the letter first.”

  I’d thought carefully about how to write it, acknowledging my bias as his uncle, listing the qualities I thought he would bring to the program and expressing my respect for and trust in the admissions process, regardless of the outcome. After reading the letter, he felt differently and decided to let it stand. The same thinking informed the rules we created around the ISB admissions process. Friends and relatives could write letters of recommendation, but, regardless, their family members would go through the same process as everyone else and be considered on their own merits.

  I personally followed this protocol when another of my nephews applied to ISB and was rejected. Both he and his mother were heartbroken and implored me to intercede. I’d been a mentor to the boy, helping him choose a career path, so, understandably, he was very hurt when I refused to use my influence on his behalf. I felt bad for him. I felt responsible for him and his brother. Plus, I knew what rejection felt like. I remembered how it had felt when McKinsey turned me down and how grateful I had been when Walter Salmon stepped in and got me a second chance. But I couldn’t compromise ISB’s commitment to meritocracy. I called and explained to him why this was important to me and why I couldn’t break the rule even for someone I loved. I was disappointed for him, but secretly I was proud of the school. In rejecting a founder’s family member, our system had passed a significant test and not succumbed to nepotism. He later forgave his uncle when I helped him apply to the prestigious Kellogg school at Northwestern University, and he went on to become a successful entrepreneur.

  On June 23, 2002, I was proud to step up to the lectern and deliver the convocation speech for our very first graduating class. Looking out over the sea of faces, I saw India’s future. I wished we had more diversity of international students, and more women, but we were off to a great start. Almost all of that first graduating class had job placements with great companies, at home or abroad. Pramath and I, along with a few others, had worked every weekend for months on this—calling companies, persuading them to come and interview our graduates. It was all worth it for that moment.

  As the school became established and continued to grow, there was always a tension between the board’s desire to scale fast and the faculty’s preference for a smaller cohort and a slower pace of growth. With so many results-oriented businessmen involved, the board won out, and ISB grew from 128 students in the first batch to 560 within five years. At its ten-year anniversary, it boasted more than five thousand alumni, and today that number has passed ten thousand. ISB graduates more than eleven hundred students every year. A second campus has been established in the northern city of Mohali—largely funded through the generosity of four friends, Sunil Mittal, Sunil Munjal, M
ickey Punj, and Analjit Singh—and the school continues to thrive.

  In 2008, only seven years after we had opened our doors, to everyone’s surprise, ISB made the prestigious Financial Times ranking of the top 20 business schools in the world. I was honored, but not sure we deserved it—yet. Had our brand gotten ahead of our reality? We had not yet attracted the foreign students we wanted, nor established a large permanent faculty. I told everyone we needed to work hard to catch up with our brand. But I was proud of the achievement. I knew that the quality of our students, their placement record with blue chip companies, and the quality of the curriculum were all deserving of the honor. ISB would remain on the list for many years to come and still features today.

  Another more personal moment of satisfaction came in 2006, when I invited the Indian business titan Ratan Tata to be our fifth convocation speaker. Tata had been an early supporter but had withdrawn from the board. The reason he gave, at the time, was that he felt our priorities were wrong: we should not have been spending so much money on a fancy campus when India was such a poor country. However, when Tata gave his convocation speech, he graciously acknowledged that he had been wrong about the campus. Looking around at the beautiful, state-of-the-art facilities, he said he now understood why we’d insisted on doing it this way.

  There were many moments in the journey when I wondered if we’d bitten off too much, but we were determined to follow through on our vision. ISB is one of my proudest achievements, and one of the aspects of it that means the most to me is that it doesn’t bear my name or any other person’s name. Before ISB, most philanthropic endeavors in India were old-fashioned, funded by and named after wealthy or influential individuals. ISB was different. It’s not “my” school or any of its funders’; it’s India’s school, built by a group of dedicated people who love their country and want to contribute to its future. This was my intention from the beginning—that India’s business leaders and the Indian diaspora would feel a collective ownership of their business school and support it with their time, their money, and their recruitment efforts. ISB demonstrated to the Indian private sector that it could play a catalytic role in shaping society.

  It demonstrated something to me as well: how much human beings with disparate interests and backgrounds can achieve when they unite for an unselfish purpose. ISB would become a template for many institutions I and others would build in the years to come: unique, multi-stakeholder coalitions, marrying the public and private sector, often bringing unlikely partners to the same table, held together by a common vision.

  With my parents and sisters at our Delhi home

  Posing for a picture aged three

  With my siblings including my younger brother

  At the inauguration of the student activity center at IIT

  “Posh Puja” ceremony in the Kashmiri tradition at our wedding

  With Anita during my early days as managing director at a McKinsey conference in South Africa

  Marvin Bower dressed as Santa at my Scandinavian farewell party

  All my McKinsey partners from Scandinavia with Marvin Bower

  Vacationing with my four girls in Colorado when I learned of my election to managing director of McKinsey in March 1994

  At the ISB board meeting with the founding board members

  Meeting Premier Zhu Rongji of China

  With President Bush at the Oval Office being recognized for my work in global health

  Playing Scrabble with President Clinton on our travels in India

  Fireside chat with Bill Gates at the first Pan IIT conference

  In discussion with Secretary General of the United Nations Kofi Anan regarding management reforms at the UN

  At the launch of the Public Health Foundation of India with Prime Minister Manmohan Singh and Professor Amartya Sen, Kapil Sibal, education minister, and Anbumani Ramadoss, health and family welfare minister

  In discussion with Speaker Nancy Pelosi at our home in Westport

  Speaking at the UN General Assembly session for heads of state which is held every five years

  With Prime Minister Manmohan Singh after his speech to McKinsey partners

  With my German partners on McKinsey’s board who brought along an elephant to my retirement party

  Extended family get-together for Thanksgiving

  With Deepali at her graduation from Brown in the middle of my trial

  The graduation I had to miss. Aditi with Sonu and Anita at Harvard Business School

  My IIT friends at our annual get-together

  Meera and Nisa spending time with me the day before I went to prison

  Most of my immediate family visiting me in prison

  Meera and Nisa visiting me at what they thought was a private camp

  With my brother, who visited frequently

  With Pramath Sinha, who also visited me frequently from India

  My walking outfit in winter with two neck warmers, two hats and my MP3 player

  Walking in deep snow with my bunk-mate

  The bridge foursome that played every day

  My first steps of freedom outside the prison after serving my sentence

  My four girls celebrating Megha’s birthday after my release

  With Lekha, born after my release, enjoying a walk on the beach

  Dancing with Riya, my youngest granddaughter, at Aditi’s wedding

  12

  Transition

  Man’s abiding happiness is not in getting anything but in giving himself up to what is greater than himself, to ideas which are larger than his individual life, the idea of his country, of humanity, of God.

  —Rabindranath Tagore, Sadhana

  Fall 2003

  “Take a new job,” Anita suggested. “Maybe it’s time for a change. Become a CEO or do something completely different.”

  I was fifty-four years old. Staring out of my front window at the elephant tracks still visible on my once-pristine lawn, I was reminded every day that my time as managing director had come to an end and I needed to decide what was next. I was ready to move on—the job had been physically and emotionally demanding, and I’d given it my all. Retirement was the last thing on my mind, as my wife well knew, but I think she hoped I might at least slow down a little.

  I thought seriously about her suggestion. Was it time for a change? I didn’t feel ready to leave McKinsey. For some reason, the idea that I would spend my entire career in one institution appealed to me. The new managing director, Ian Davis, was a friend, but I was careful not to get in his way or offer advice unless asked. I’d been in his shoes once, and I knew how important it is for a new leader to establish his own independent leadership style and authority. I decided to try to carve out a different kind of role for myself within the firm: something no former managing director had ever done. I’d remove myself from governance responsibilities and focus my attention on bringing in new clients. As a managing director emeritus, I’d be available to represent the firm on the global stage as needed, and I’d also expand my philanthropic activities, with McKinsey’s blessing, and have a greater impact on the global problems I cared about.

  I tapped my vast network and continued to introduce major clients to the firm. Interestingly, I think the freedom of my new position made me even more effective. I could focus on building relationships, without the urgency to close the deal. Sometimes the secret to client development is simply patience. A case in point was Lee Scott, CEO of Walmart. The retail giant was flying high in the early years of the new millennium and made it clear it had no use for consultants. McKinsey had been trying to develop them as a client for some time, but to no avail. I met Lee when he joined the board of Tsinghua University School of Economics and Management, and we shared a long, slow car-ride to dinner in Beijing’s terrible traffic. At the end of our wide-ranging and fascinating conversation, I proposed to Lee that I visit him in Bentonville, the Arkansas headquarters of Walmart, so that we could continue.

  “Okay, you can come,” he said, �
��but don’t expect any work from us. We don’t use consultants.”

  Undeterred, I made the trip and we met for an hour. At the end, I asked him if our conversation had been of value to him, and he acknowledged that it had. “So we should do it again,” I said, and three months later I returned. This went on for three years, with nothing to show for the time and travel other than a growing trust with Lee. And then finally, one day, he called me with an assignment. That was the beginning of the firm’s extensive work with Walmart.

  Most companies, especially large, complex ones, are going to need help sooner or later. But they’ll call a consultant when they are ready, not when you’re ready. The key is to be the first person they think of when they decide to make that call. I achieved this by focusing on providing value in my relationships—contributing to their thinking without any immediate expectation of return.