Indian subcontinent since time immemorial has been the abode of spiritual bliss. It has shown the light of wisdom and harmonious peaceful coexistence to the rest of the world. But as the time passed by, with the influence of materialistic western lifestyle, Indian society is now characterized by degradation in values and moral standards. In a recent survey by Transparency International, India tops the list in the Payment of Bribe Index and is also adjudged as one of the most corrupt countries in the world. Business is a part and parcel of the society and is also no exception.

Traditionally, businesses have placed the highest priority on making money – concern for employees and human values has typically received less attention. This is evident from the Norwegian term for business administration: "Økonomi og ledelse" which puts "economics" before "leadership". In a Financial Times (June 7-8, 2003) interview, even the grand old man of conservative economics- Milton Friedman – concedes "The use of quantity of money as a target has not been a success". Inline with this, a 2003 survey by the Argument Group, found that three out of four Norwegian executives reject that a corporation's sole responsibility is to give the owners the biggest possible profit.

Money, therefore, is not the only goal of business – in fact it is not the major goal. Money is needed for everything in the world, but it is not enough for living a really good life. Man needs a purpose beyond money. A 2004 survey by Roffey Park & Management Today of 750 managers and board members found that close to 70% of them were searching for a deeper meaning in their job.

In contrast to money driven businesses, value based organizations practice leadership and management through shared productive and ethical human values. Within this broad framework, self-managing individuals can be left to experience and display high levels of meaning, enthusiasm, initiative, creativity, integrity, happiness and self-organization – for the benefit of themselves and their corporation. Such organizations realize and live according to the principle that their associates are their greatest assets. The basic concept of putting man first is beautifully expressed in the German philosopher Immanuel Kant's Third Categorical Imperative: "Act so that you treat humanity, whether in your own person or in that of another, always as an end and never just as a means. "

Of course, value based management also includes making money. It is not a question of either man or money. It is a quest for both happiness and profit. Research shows that value based or visionary companies perform on a markedly higher level – they earn much more money – than merely profit-based companies. In the above backdrop, the present article is prepared with the following objectives:-

*  To throw light on what is value based management.*  To provide ideas on why to use value based management.*  To give details on practices and procedure on value based management.*  To throw lights on value based management in Indian context and attempts to highlight the VBM in three different sections.

Section-I deals with the concept and historical perspective, Section-II highlights the dynamics or implementation process and the Section-III reflects VBM in action and the conclusion.

SECTION-I

Value Based Management has been defined in different ways:

Value based management is the management approach that ensures corporations are running on values (normally maximizing shareholders value).  Value based management includes all the three of the following:

*  Creating values (ways to actually increase or generate maximum future value, strategy).*  Managing for values (governance, change management, organizational culture, communication, leadership); and *  Measuring values (valuation).

Value based management aims to provide consistency of the corporate mission (business policy), the corporate strategy, corporate governance, corporate culture, corporate communication, organization structure, decision processes and systems, performance management processes and  reward processes and systems.

Value based management can be simply stated as management system in which entire organization is focused, measured, compensated for creating value for stakeholders (i.e., customers, shareholders, employees, vendors). Value-Based Management (VBM) is a customer-focused system built upon shared principles and core values, which is designed to instill an ownership culture within an organization.

The value based management is managing and giving values to all stakeholders. They are as follows-

ORGANISATION*  Encouraging a working climate with innovation & free exchange of ideas.*  Demonstrating personal integrity & humanity.

SHAREHOLDERS *  Protecting and safeguarding their investment.*  Ensuring them a fair return

EMPLOYEES*  Understanding & acceptance of the needs and rights.*  Providing adequate wages, good working condition, job security, effective machinery for speedy redressal of grievances.*  Suitable opportunities for promotion and self development.*  Creating a sense of belongingness & team spirit through their close link with management.

CUSTOMERS*  Products with proven quality at fair price.*  Fulfilling its commitments impartially and courteously with sound business principles.

GOVERNMENT*  Confirm national interest as mentioned in government policy.

COMMUNITYSocial responsibility-*  Effective use of natural resources*  Assistance in community affairs.*  Assistance during natural hazards.

VALUE BASED MANAGEMENT: A HISTORICAL PERSPECTIVE

The history and development of Value Based Management (VBM) and the growth of internal and external corporate complexity over time are highly interrelated. This is only logical if one realizes that VBM is basically a philosophy enabling and supporting maximum value creation organization.

Before the industrial revolution, companies were relatively small and their internally complexity was low. Also the external environment of companies was relatively stable and clear. Value creation was relatively straightforward, simple and obvious. There was no need for VBM.

IMPLCIT VBM (1800-1890)

The earliest forms of implicit "VBM" dated back to the end of the 18th century, when, by mechanizing and by the Industrial Revolution, it was possible to achieve economies of scale through investing in machines and hiring workers. The dislocation of facilities made direct supervision harder and insight into the efficiency and productivity of the production process became more important. During the19th century, these methods gradually improved, using improved transportation and communication mechanisms available. These systems were aimed at promoting and evaluating the efficiency and productivity of decentralized production processes and not on measuring and managing value creation as such.

EXPLICIT VBM (1890-2000)

At the end of the19th century, Alfred Marshall sees profit as the residual income accruing to a firm's owner, a return to the investment of his own capital and to the pains he suffers in exercising his "business power" in planning, supervision and control. Frederick Taylor (1911) and Harrington Emerson develop Scientific Management (using detailed physical manufacturing standards, enabling a simple translation to financial standards).

Corporations become more complex with a diversified product assortment and activities. Allocation of assets over the various activities and as a result, better information on these activities becomes more important. Management Accounting introduces Return on Investment (ROI), at first, only at top management level for allocating resources and judging performance.  

In 1938, Grant makes some references to using the time value of money for deciding among investment options. In 1954, Dean publishes an article in the HBR about use of Discounted Cash Flow (DCF) practically for valuing investment proposals and other decisions. Later, also

methods are introduced such as residual income, responsibility accounting and transfer pricing.

Professional Investing – In 1964, Sharpe introduces the Capital Asset Pricing Model (CAPM) and in 1973 Black and Scholes introduce their formula for calculating the value of financing options.

In 1964, Peter Drucker writes "Managing for Results" and in 1986, Alfred Rappaport writes his ground breaking book "Creating Shareholders Value". In 1994, Jim Taggart uses the term "Value Based Management" in his book "The Value Imperative: Managing for Superior Shareholders Returns". From now on, thinking in Shareholders value term is firmly rooted in business and corporate strategy. 

SECTION-II

IMPLEMENTATION PROCESS

As a company implements Value based management, it will need to accomplish three steps: gain senior team commitment, customize the VBM framework, and finally, makes VBM a way of life in the organization.

GAINING TOP MANAGEMENT COMMITMENT

VBM is similar to all other initiatives in one respect. Senior management needs to support VBM with their words and ultimately with their actions. It is up to the senior team to create a sense of urgency around the initiative and clearly communicate a vision of the impact that VBM will have on the organization. In short, they must make the reasons for VBM simple, clear and compelling. Anything less than the full commitment of the senior team will ultimately cause the initiative to fail and simply become, another "Program of the month", that does not achieve the intended results. The organization will spend a lot of time, money and energy without receiving adequate returns from the VBM investment.

DEVELOPING A CUSTOMISED VBM FRAMEWORK

Implementing VBM requires an organization to redesign its management practices. The key management practices are performance measurement, compensation design, planning/budgeting and training and communication programs.

*  Performance Measurement

The first step in customizing a VBM framework is to abandon accounting based metrics and define a value-based measure, such as economic profit, as the key performance metric of the company. The overarching goal is to improve economic profit over the long-term. When a firm takes the long –term view, it is imperative to act in an ethical and socially responsible manner. Anything less may improve short term prospects but will not lead to long-term success.

Less is more when defining the measure. While the measure needs to be grounded in financial theory, keep the complexities to a minimum. Remember, if improving economic profit is the goal of the organization, then people need to understand how it is calculated and ultimately how they can make decisions that improve economic profit.

*  Compensation Design

If the incentive plan is not adequately tied to value creation, a disconnect will occur between the creation of shareholder value and the manager's compensation. This disconnect may cause the actions of the managers to not be in the best interests of the shareholders. Some key characteristics of value-based incentive plans compared to traditional plans are uncapped bonuses, targets based on market expectations, and the use of a bonus bank. A plan with these characteristics encourages participants to think like, act like, and be paid like owners. 

*  Integrating Performance Measures into planning framework

The new performance measure needs to be at the heart of key management processes, such as budgeting, planning, and capital allocation. A good exercise during the budgeting and planning process is to have business units calculate what level of bonus will be paid out if projected performance is met. This is an excellent way to move from a "manager" mindset to an "owner" mindset. When organizations do not consistently make decisions using the new performance measure, a mixed message is sent to the organization about the organization's overarching goal. This mixed message will lead to confusion about what the key objective of the organization is. 

*  Initial Training and Communication Plans

The organization needs to develop a plan and the necessary material to communicate the importance of managing for value and the basic concepts of VBM. People in the organization need to understand the basics of economic profit before they can be able to apply the concepts to daily decisions. An organization needs to develop a new reporting package that is easily understood by finance and non-finance employees alike. The results need to be communicated visually, timely, and accurately.

The initial training provides the opportunity for employees to understand new concepts and begin to develop ideas around how they can make decisions that are more in line with value creation. Communication of results will provide the necessary feedback to the organization about how their actions are impacting shareholder value. Lack of feedback on how actions are impacting value will disrupt the learning process, signal a lack of importance around the initiative, and ultimately cause the initiative to lose momentum.

MAKING VBM A WAY OF LIFE

Companies must integrate VBM into their culture. VBM cannot be thought of as just an initiative but rather as a way of life. VBM needs to become a part of the drinking water, so to speak, meaning we have to turn our efforts to ensuring that everyone in the organization understands his or her role in creating value in the organization. This begins at the top of the organization and needs to be cascaded down the entire organization so each individual understands the big question, "How does our company create value?"—and the even more relevant question, "How does my role and the daily decisions that I make impact value?" To reach this level, the organization will need to devote a significant amount of resources to provide the necessary learning, tools and feedback required so all individuals can understand their role in value creation. If you can lead your company to a place where everyone in the organization can answer the above questions, you are well on your way towards developing a culture focused on value creation.

Value-Based Management is an ethical framework for succeeding in business. As such, VBM balances moral values with material values.

Value-Based Management's three notions of value are:

*  A foundation of shared ethical values—starting with the belief in the intrinsic value of each person (each employee, customer and supplier). *  Success in the marketplace based on delivering maximum value (higher quality at lower prices) to the customer. *  Rewards based on the value people contribute to the company, as individuals and as a team, as workers and as owners.

The ethical and material aspects of value can be realized in a business by: 

*  Creating structures of corporate governance and management based on shared   moral values, as expressed in a written set ofa. company core values (ethical principles which define the culture and clarify the social purposes of the organization); and b. a code of ethics (a set of habits to be encouraged to guide individual behavior toward strengthening the company's culture and interpersonal harmony). 

*  Ideally these core values and code of ethics are agreed upon by consensus by every person in the company, and are subject to periodic review and improvement (as with Herman Miller Inc.'s "renewal process"). These serve as the "compass" for guiding corporate objectives, policies, and other decisions; they also provide a basis for judging people's behavior.

*  Maximizing value for the customer (those being served), by increasing quality and/or decreasing price. (This relationship can be expressed as V=Q/P.) Within a VBM culture, everyone in the company recognizes as a primary core value "service to the customer;" not only because as a person, each customer deserves to be treated with dignity, but because ultimately it is the customer who "signs" every employee's paycheck. V=Q/P thus becomes the simple formula for any business to follow to succeed in the competitive marketplace.

VBM is designed to "institutionalize" shared responsibility, shared risks and shared rewards within the company's ongoing structures and processes.

BENEFITS OF VBM 

*  Benefits of VBM for ManagementBy moving from an autocratic to a more participatory, value-based mode, a company's leadership can spread around some of management's typical operational "headaches." 

*  Benefits of VBM for employeesA workplace that operates according to the principles of Value-Based Management empowers employees as workers and as owners. VBM creates a corporate culture where work can be more satisfying and economically rewarding. 

*  Benefits of VBM for Labor UnionsVBM involves the transformation of labor unions, offering labor representatives new and more important roles than they have played within the adversarial wage system culture. Unions can help deliver a higher degree of economic justice and far greater rights for their members than the "crumbs" now bargained for within the framework of traditional labor-management bargaining.

*  Benefits of VBM for the Company as a Whole Experience within a growing number of companies indicates that the more that people's self interests are unified within a management system reflecting the principles of Value-Based

Management, the greater customer and employee satisfaction will be. From this can flow increased cost savings, increased sales, and increased profits.

A BRIEF SURVEY OF LITERATURE

In the extensive literature survey it was found that the foreign research scholars have contributed much on "VBM" than the Indian research scholars. The value systems were quite different for the different authors, different companies and different countries. The following articles are covered under the literature study:

The Care of VBM systems (2003) by Harley E. Ryan, Louisiance State University aimed at finding whether a firm significantly improves adjusted residual income after adopting value based management. He found that VBM improves economic performance; it highlights inefficiencies and need for improvement in compensation contacts. VBM is more effective for high growth firm than for low growth firms. VBM encourages efficient use of the invested capital. Firms with high net working capital improve economic performance after they adopted VBM. Effective corporate governance includes use of monitoring and incentive mechanism to encourage the creation of shareholders value. VBM attempts to accomplish the goal by providing manager with the set of decision making tools that identify alternatives.

*  Word Whitt, Dept. of Industrial Engineering and Operation Research, Columbia University, New York, in his article "The Impact of Increased Employee Retention on Performance in Contact Center for Customer" found that VBM as regards to employees is very important and contact center performance has often hampered by low employee job satisfaction as evidenced by high turnover of employees and giving them some value.

*  Department of Energy, Office of Project and Fixed Asset Management in Life Cycle Asset Management (1997) viewed that "VBM is not just a good idea…. It's the law," whereas Frederick Taylor (1911) opines "In the past, man was first and in future, the system will be the first."

*  Tad Leahy in 'Making their Mark'(Business Finance) views "VBM, like any new technological initiative you put in place at your company,  is like a loaded gun, so you need to be careful about how you put that gun in people's hands," Newer companies have an easier time with value-based management than older ones that have outdated, hard-to-remove legacies

*  In "Transformational Leadership: Peer Mentoring as a Value- Based Learning Process"-Mary Ann Mavrinac sees values as the foundation for organizational life. The connection between individual wants and needs and public values are at the heart of transformational leadership. The Leader who can achieve congruence between individual and organizational needs in a change initiative is very likely to be successful.

SECTION III

VBM IN INDIAN CONTEXT

Gita Piramal selected the top legendary business houses in India on the basis of following VBM criteria. 

*  Not rags to riches, not because of their personal triumphs but for the impact their work and effort have on thousands of ordinary lives. *  For producing products and services which are globally competitive. 

*  Modern mind.  Traders think of today's profit, an industrialist looks at tomorrow's balance sheet but a legend thinks of the next generation. *  Who go out of their way to encourage other entrepreneurs to start new businesses? *  Pioneering spirit: don't take the easy road to prosperity but hack roads through jungles, build factories in villages, transform barren tracts of land into profitable assets, change mind-sets, pioneer industry or services.*  Commitment to education. *  Patriotic entrepreneurship/economic nationalism. During the earlier Raj they fought for    the rights of Indian entrepreneurs to exist and vociferously criticized economic    racism. Today they register Indian patents in USA etc.

TABLE SHOWING THE VALUE SYSTEM IN INDIAN COMPANIES

NAME OF THE COMPANY

FOUNDER PARAMETERS

TATA GROUP J. R. D Tata Tata ethos-ideals and traditions Sound and straightforward business principles. Commitment towards the interests of the shareholders. Health and welfare of the employees. Generous towards people.

RELIANCE GROUP Dhirubhai Ambani

Huge production and best quality of output with cheapest price. Think big, think fast, think ahead. Introduced the equity cult to thousands of ordinary Indians.

AMUL Verghese Kurien Professionalisation of farming. innovative process Use of qualitative equipment. Constructive social change in rural areas. Empowering the rural masses. Information and infrastructure.

BIRLA GROUP G D Birla Commitment to untested values. Humanity and tolerance for the weaknesses of others. Taking risks.

ZEE TV Subhash Chandra

Fully committed to current concepts such as shareholder value, and value-based management (including out-sourcing, employee stock options etc.)

Quality products at competitive prices. Challenged government vision of what people want from electronic entertainment.

BOMBAY SPINNING MILL

Cawasji Nanabhoy Davar

Factory system with factory labor. Led the way for other entrepreneurs to enter industry.

MITTAL STEEL L N Mittal Unique mix of cultures in the management team: takes best from each country. Open discussions -Asks everyone to tell top management what problems are and what

should be the solutions. Then instills discipline that what has been decided must be done perfectly.

INFOSYS N R Narayana Murthy

Ethical business practices and transparency

WORLD TEL Satyen (Sam) Gangaram

Pitroda

Access to telephone   lines for ordinary people

HINDUSTAN LEVER.

Prakash Tandon Professional  management

Source: The Millennium Special; the Past the Present & the Future-Gita Piramal, rediff on net

Today, value based management is very important and the aspects are ethics and transparency, innovativeness, quality and depth of management, financial performance, quality of product and services, global competitiveness and people practices & talent management. The bright example is the ranking made for the top 25 companies as shown below:-

*  INFOSYS Technologies has bagged the number one position and for the fourth time it is again in the row, a record of sorts (2001, 2003, 2004, and 2006).

*  The survey also reveals that reliance is rated on second on financial performance but has been pegged at 10th on ethics and transparency. Nevertheless, the fact that reliance did not slide down a lot further despite the Ambani family washing dirty hands in public is a testimony to the mystique of Ambani brand. Reliance is the only company that has featured in the top 10 of every most respected company's survey since 1983.

*  Another fascinating fact found was that, people tend to express respect for the Tata Group as a whole and not for any individual TATA company. I.e. only 'Tata'. It was in second position in infrastructure sector. It has done well in ethics and transparency.

*  SBI the country's biggest bank with nearly 14000 branches was in third position in banking sector due to use of technology and focusing more on medium sized business and advertising campaign.

*  Increasing competition and internal strife have turned AMUL slightly bitter but it remains a force to reckon with due to better quality of products.

CURRE NT

RANK

PRE VIO US

RAN K

COMPANY TOTAL SCORE

INNOVAT IVE-NESS

QUALITY AND DEPTH

OF MANAGEME

NT

FINANCIA L

PERFORM ANCE

ETHICS' AND

TRANSPAR ENCY

QUALITY OF

PRODUCT AND

SERVICES

PEOPLE  PRACTICES

AND TALENT MANAGEMEN

T

GLOBAL COMPETITIVE

-NESS

1 1 INFOSYS TECHNOLOG

Y

18,124.2 2,230.2 2581.0 2778.2 2772.3 2315.7 2623.4 2823.4

2 3 WIPRO 10,218.5 1,052.7 1,435.9 1551.4 1590.3 1235.5 1636.6 1716.13 2 RELIANCE

INDUSTRIES9,118.8 1,276.5 1,317.5 1969.6 1021.4 1007.4 1132.5 1393.9

4 9 ICICI BANK 8,911.2 1,528.3 1,381.8 1211.6 1166.9 1200.5 1229.6 1192.55 13 TATA

CONSULTAN CY SERVICES

8,474.5 822.8 1,232.0 1210.3 1445.7 976.6 1323.3 1463.8

6 5 MARURTI UDYOG

7,690.9 1,012.1 1,069.6 1010.5 1047.2 1357.7 1061.2 1132.5

7 21 ITC 7,154.2 938.5 1,167.3 1120.4 1004.4 943.4 1116.0 864.28 7 HDFC BANK 7,097.9 1,091.9 1,126.3 956.3 1076.4 1000.2 1029.5 817.69 12 TATA MOTORS 6,357.9 647.9 982.8 780.2 1202.3 997.5 848.2 899.010 14 LARSEN &

TOURBRO6,331.8 662.2 924.8 940.0 1027.5 926.4 937.4 913.6

11 23 NOKIA INDIA 6,286.2 1,213.4 700.1 605.6 675.3 1156.2 887.4 1048.012 26 BHARATI

AIRTEL5,969.4 1,064.6 872.3 902.7 690.0 880.1 822.8 737.0

13 17 OIL AND NATURAL GAS CORPORATI

ON

5,952.3 687.1 944.9 996.6 836.6 694.3 799.2 993.2

14 8 JET AIRWAYS 5,860.9 978.2 797.1 532.1 689.0 1086.4 805.6 972.515 18 HERO HONDA

MOTORS5,798.3 863.8 763.0 993.0 697.9 915.1 784.4 781.2

16 15 TATA STEEL 5,751.9 499.2 846.9 765.0 1182.6 736.2 850.0 872.1

17 4 HINDUSTAN LEVER

4,863.1 629.0 780.0 621.3 716..3 707.8 811.1 597.6

18 11 GCMMF(AMU L)

4,659.2 967.7 625.0 450.1 721..9 923.4 527.0 444.1

19 10 RANBAXY LABORATORI

ES

4,433.2 655.9 622.9 692.6 561.7 639.0 630.4 630.7

20 20 BAJAJ AUTO 4,309.2 689.1 629.2 725.7 551.3 675.9 474.9 563.221 24 CITI BANK 4,155.7 746.7 680.4 495.1 412.0 568.3 695.2 558.022 16 STATE BANK

OF INDIA3,939.8 451.7 578.9 699.8 703.7 478.7 494.2 532.8

23 6 DR. REDDY'S LABORATORI

ES

3,527.2 624.1 495.0 630.1 428.2 432.1 445.3 472.3

24 32 NEW DELHI TELEVISION

3,457.7 618.8 489.8 395.9 417.0 592.1 573.3 370.8

25 22 INDIAN OIL CORPORATI

ON

3,431.0 426.0 497.1 574.1 489.7 491.8 480.0 472.3

Source: Business World , 5 June,2006 p.54

RANKS OF SELECTED COMPANIES IN INDIA'S 100 MOST VALUABLE BRANDS

Rank Company Image and perception

Brand awareness

Brand loyalty Brand association

Brand performance

Overall mean

4 INFOSYS 3.897 3.463 3.120 3.183 9.776 23.4388 TATA 3.732 3.630 3.252 3.382 8.998 22.993

14 ICICI 3.705 3.667 3.248 3.238 8.534 22.42141 RELIANCE 3.179 3.793 2.969 2.668 6.723 19.33250 SBI 2.863 3.687 3.064 3.196 6.122 18.93172 LIC 2.660 3.533 3.279 2.633 5.412 17.51897 AMUL 2.142 2.511 2.551 2.554 4.274 14.033

Source: 4p's Business & Marketing July 2006

* Infosys manages to snatch top slot in this ranking criterion. It stands for integrity, trust and excellent HR practices. Infosys is the company that is not just a back office of international companies, but the companies that can be trusted to provide customized solution that have international excellence. It has been rated as one of the most "innovative" companies in the world.

* TATA brand represents a sense of nationalization, reliability, assurance and a true value for money. Today, the brand Tata can be termed as a brand that represents leadership with trust.  The heritage of Tata to return to the society that it earns has evoked trust amongst the consumers, employees, shareholders and the community.

* Reliance today, conveys a titanic empire emerging as a true blue multinational .In spite of the de-merger and the controversy in early 2006, when the two Ambani scions Anil and Mukesh decided to go separate ways, the emergence of Reliance, with definite conviction, does reflect the parallel rise of the nascent Indian private sector from behind the shadow of the public sector enterprises. 

* SBI is today hailed as the big daddy of Indian banks as it touches the lives of people from Kashmir to kanya kumari and building the nation with the enormous welfare activities. The bank has evolved today as a synonym of trust, reliability, and credibility.  From a fuddy- duddy sluggish employee image to the image of being customer friendly, India's largest bank SBI has come a long way providing various products and services. The investors are emotionally connected with the tagline of SBI "We have the power of SBI".

STEEL AUTHORITY OF INDIA LIMITED

SAIL is the largest public sector steel industry with vision "To be a respected world-class corporation and the leader in Indian steel business in quality, productivity, profitability and customer satisfaction" and with Credo that 

*  Building lasting relationship with customer based on trust and mutual benefit*  Uphold highest ethical standards in conduct of their business*  Create and nurture a culture that supports flexibility, learning and is proactive to change*  Chart a challenging career for employees with opportunities for advancement and rewards.*  Value the opportunity and responsibility to make a meaningful difference in people's lives.

TATA GROUP

The TATA Iron and Steel Company were India's first and the largest steel company in the private sector. Today, Tata steel ranks among the worlds top steel company and has emerged one of the lowest producers of steel of world. The values and the work culture were imbibed by the legendary J.R.D Tata who believed that whether in business or life, it was people which matters the most. Tata steel values viz. "respect for the individual" "credibility" and "excellence" are demonstrated in everything it does. TATA has made commitment towards employee relations, environment, corporate governance and community.

AMUL CO-OPERATIVE

The Brand name AMUL from the Sanskrit word "Amoolya" meaning priceless, has really become the symbol of many things; specifically "the taste of India". AMUL was established in 1971 and since then have achieved leadership position in dairy products and now the big daddy in market. This CIO International IT excellence Award has recognized the Cooperative Movement & its Leadership under the "Amul" brand, initiated by Dr. V Kurien, Milkman of India, who's main Motto is to build Indian Society economically & literally strong through innovative cooperative resourceful network, so as to provide quality service & products to the end consumers and good returns to the farmer members.

Amul embarked upon its illustrious journey as a beacon for the Indian cooperative movement in 1946. Since then, it has been undergoing a multidimensional evolution whose overarching objective has been the same throughout: serving the farmer and catering to consumer requirements. A structural landmark in this evolution process was the formation of the GCMMF in 1974. Throughout these last 31 years, we have demonstrated- again and again-that Amul both represents and reconciles diverse expectations and aspirations.

RELIANCE GROUP OF COMPANIES

"Growth through Vision""Growth has no limit at Reliance. I keep revising my vision.Only when you can dream it, you can do it." Dhirubhai H. AmbaniFounder ChairmanReliance Group of Companies

Dhirubhai Ambani founded Reliance as a textile company and led its evolution as a global leader in the materials and energy value chain businesses. He is credited to have brought about the equity cult in India in the late seventies and is regarded as an icon for enterprise in India. He epitomized the spirit 'dare to dream and learn to excel'. In spite of the de-merger and the controversy in early 2006, when the two Ambani scions Anil and Mukesh

decided to go separate ways, the emergence of Reliance, with definite conviction, does reflect the parallel rise of the nascent Indian private sector from behind the shadow of the public sector enterprises

MUKESH AMBANI GROUP

Reliance Industries Limited is the largest private sector business enterprise in India, on all major financial parameters, including sales, profits, net worth and assets.

ANIL AMBANI GROUP

The Reliance – Anil Dhirubhai Ambani Group is among India's top three private sector business houses on all major financial parameters. The interests of the Group range from communications (Reliance Communications) and financial services (Reliance Capital Ltd), to generation, transmission and distribution of power (Reliance Energy), infrastructure and entertainment.

STATE BANK OF INDIA

State Bank of India (SBI), the largest bank of India has been the lifeline of Indian Banking System. With the network of branches throughout the country, it strives to cater the expectations of different stakeholders. With the provision of new and innovative financial product and diversified services, it has attuned itself to the changing needs of time.

INFOSYS

India's face of IT: that is what Infosys has been to the world. It stands for excellent HR practices. The only generic brand after the TATAs to have made a mark, Infosys is the company that is not just a back office of International companies, but the companies that can be trusted to provide customized solution that have international excellence. Infosys works with a vision to be a globally respected corporation that provides best-of-breed business solutions, leveraging technology and delivering by best-in-class people. It has a mission to achieve the objectives in an environment of fairness, honesty and courtesy towards the clients, employees, vendors and society at large.

Values drivers: C-LIFE 

*  Customer Delight: A commitment to surpassing our customer expectations. *  Leadership by Example: A commitment to set standards in business and transactions and be an exemplar for the industry and own teams. *  Integrity and Transparency: A commitment to be ethical, sincere and open in dealings. *  Fairness: A commitment to be objective and transaction-oriented, thereby earning trust and respect. *  Excellence: A commitment to strive relentlessly, to constantly improve the workforce, services and products so as to become the best.

LIFE INSURANCE CORPORATION

LIC offers insurance protection through its insurance services. It utilizes people's money for people's welfare with a mission to ensure quality of life through financial security by providing products and services of aspired attribution with competitive return and by rendering resources for economic development.

FINDINGS

From the table specifying the value based management in various companies, we are able to have a brief knowledge about their strategies framed to satisfy their stakeholders. Software Company Infosys who bagged the first prize in value management this year gives importance to the values of each party for the financial and social enhancement of the company. On the other hand, Tata Company which is largest company in Steel sector has framed various programmes for each party for increasing the efficiency and satisfaction of interested parties. Reliance after its division between two brothers has not reduced the value management. In the same way other companies specified like State Bank of India, Life Insurance Corporation, SAIL have framed their values keeping in consideration the parties' values and organizational values.

But are the companies really rendering the responsibilities in true sense? No. We can prove this by specifying Tata companies' fulfillment of national objectives on the condition that the competitions from other companies and international companies are minimized. Reliance entering into a scam in oil sector specifies that they are failing in standing to their own values. State Bank of India Strike of employees for salary enhancement shows their dissatisfaction on their own bank. Amul declaring an artificial scarcity of product brings an environment of distrust among the customers. By specifying the values in the website and annual report does not mean that the companies are really standing to the values rather they should practice it in an honest and fair way.

SUGGESTIONS

The Indian corporate houses should be conscious to give values to all the stakeholders basically the customers and community classes; and the value based management can be made with the following four principles-

*  Commerce with morality*  Business with responsibility*  Management with humanity*  Administration with principle

CONCLUSION

Value Based Management is introducing a new era where values of company as well as the various parties interested are treated as an asset. Companies, whether private or public, profit making or non-profit-making, banking or trading, have to frame ethical and honest values which satisfy the needs of the vendors such as employees, customers, and other stakeholders. For example: - Infosys Leader Mr. Nagawara Ramarao Narayana Murthy says "I'm a capitalist in mind, a socialist at heart" and is awarded the first position in value management this year. In 21st century the winners in order to stand the global competition always plan to stick to the fundamental values, no matter what the situation. It is rightly said by Shiv Khera, Management Consultant,

"Winners stand firm on values but compromise on petty things.Losers stand firm on petty things but compromise on values".

Again when our value systems are not clear, getting what we want will be a bigger tragedy. The story of Midas says it all. Distorted values leads to tragedy like the king who had a lot of money but still wanted more of money for which he asked god to make every thing gold what he touches and thereafter he touches her daughter who turns gold. This means that we should have some value systems but that value system should be focusing on right things

for right reason. Value Based Management in Indian context has grown not out of the realization of its tangible benefits but out of the compulsions at the marketplace. VBM in order to be meaningful must be a way of life and philosophy because it is the eternal vigilance that pays the price of liberty.

WELCOME TO INDIAN MANAGEMENT !This is a special site developed by the Centre for Organization Research and Development in Management (CORD-M), Hyderabad, India. The members of CORD-M Under the Guidance of Prof. B. R. Virmani have been involved in research on various aspects of Indian management for over two decades and would like to share some of their research findings as well as help various types of organizations in developing and implementing some of management practices and precepts specially meant to address the issues and peculiarities of Indian organizations. Prof. B. R. Virmani is the Chairman of Centre for Organisation Research and Development in Management. (CORD-M) and Formar Dean of Administrative Staff College of India (ASCI), Hyderabad, India.

The management concept in the west developed as a result of evolutionary process, based on the changing values systems of the people - the social, political, and economic environment as well as educational and cultural milieu. However, in India, historically we never evolved our own concepts, keeping the Indian scenario in view. We found it convenient to transfer management technology, trust as scientific technology. As a result of these grafting process of management, we have created more confusion in management thinking.

However, suddenly due to success of the Japanese methods of management, even the western countries have started doubting their own concepts and are trying to emulate the Japanese lessons. This has further confused the Indian managers as well as the management experts, who all along were following as a gospel truth whatever the westerners had developed.

Our Research finding in Indian Management indicate that many of the Management

practices suggested by Foreign specially the Western consultants when implemented in Indian Organizations, get rejected by the environment resulting in contradiction within the Indian context between stated policies and actual practices termed as "Dualism" in Indian Management. Many of these practices remain on paper without proper implementation. Therefore, it becomes imperative to evolve our own concepts of Management, which are in tune with Indian environment and value systems. Based on extensive research we have evolved such concepts and Management practices which are acceptable in Indian context.

Challenges of Indian Management

Management in India is an amalgam of practices borrowed from the West-and more recently from Japan-overlaid with age-old Indian values and norms that the still extant. This book is a seminal attempt to understand the nature of Indian Management and how it can be institutionalized. With an in-depth historical perspective and a thorough analysis of four types of Indian organizations-traditional family-owned private sector; public sector, government departments and multinationals - the author highlight certain common styles, policies and practices that are in consonance with the Indian environment and also provides guidelines for management practices for Indian organizations. The contradiction within the Indian context between stated policy an actual practice has been explored and brought to the fore. Also in this book: " Evolution of management in India from ancient times to the present; " Evolution of management practices in the West and Japan; their strengths and weaknesses as also their relevance in the Indian context. " Overview of Indian Management and the future direction it could take. Lucidly written and replete with detailed case studies based on data collected from over 50 organizations the book provides the path Indian Management needs to take in the context of the changing competitive environment. It will be invaluable for CEOs, managers, public policy administrators as also for consultants, teachers, researchers and students of management. The book is published by Response Books Sage Publications, New Delhi (2007).