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March - 2003 - issue > Leadership
Raj Gupta Meritocracy Wins
si Team
Friday, February 28, 2003
IN 1907, TWO YOUNG German entrepreneurs, chemist Otto Röhm and businessman Otto Haas, established a partnership in Esslingen to manufacture and sell a leather bate, Oropon, to tanners. The Rohm and Haas Company became an almost instant success; in 1909, Haas was able to travel to the United States to establish a branch office in Philadelphia, Pennsylvania. Almost a century later, Rohm & Haas (NYSE:ROH) is today a $6.47 billion company, a growth that was leveraged on acquisitions and a giant merger with Morton International. As the company website claims, most Rohm and Haas products are never seen by consumers; rather, they are used by other industries to produce better-performing, high quality end-products and finished goods.

Raj Gupta joined Rohm and Haas in 1971 as a financial analyst. A graduate from the IIT, Gupta did a master’s in operations research from Cornell and went on to get an MBA in finance from Drexel. After 30 years serving the company in 13 jobs under 17 bosses in three different countries, Gupta became the third non-family CEO and the first from another country, in this German immigrants-founded company which rarely sought people from outside for leadership. The company believes in pure merit, and sets no store by race, color and other discriminative factors, says Gupta. In contrast, Gupta compares, Indian corporates are riddled with family ties and meritocracy finds no place. Gupta argues that with a few exceptions, this approach to leadership is unique to the U.S., which boasts, in his view, the best crop of corporate leaders. In contrast, his home country of India has a rigid caste system that makes it tough for some very qualified people to attain leadership positions. “The meritocracy in the U.S. corporate workforce has led many of the best people to leave their countries and come [to the U.S.],” he says.

As a global company, Rohm and Haas needed a leader who could think on a worldwide scale. Given his international work experience, Gupta says, made him a good suitor for the post. Global companies need internationally minded executives, he says. As a corporation deals with different cultures and different mindsets, it is important to be extremely sensitive to these people needs, underlines the CEO. Gupta feels that his upbringing in a different country and culture has helped him be more aware of these issues in his leadership.

He urges innovation and self-challenging in his team. In a recent report, one of his senior executives captures his message, “An economic downturn is no time to let up on investment in technology. In fact, it’s the time to make certain we invest in people and in the facilities that will shape our future. Enhancing the potential of our current employee teams and new recruits through networking and mentoring opportunities is essential if we are to keep at the cutting edge of scientific developments, discoveries and tools. The very nature of innovation has changed, and we are changing with it. In its most basic form, innovation is about creating and delivering value to customers. We are seeing the definitions and culture surrounding innovation expanding far beyond traditional measures and adapting to them.” The Man from Muzzafarnagar thus leads his company forward.

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