Why babus make better public-sector bosses than professors

The transition into high-profile public-sector roles often sparks debate about the effectiveness of leaders from diverse backgrounds. This discussion is particularly relevant when comparing individuals with corporate experience, academic credentials, and those from the Indian Administrative Service (IAS). 

A case in point is the recent controversy surrounding the work culture at the Securities and Exchange Board of India (SEBI) under Madhabi Puri Buch, an MBA from IIM Ahmedabad, who served as the CEO of ICICI Securities and several other companies. 

Madhabi's distinctive work culture

Madhabi Puri Buch's appointment at SEBI has brought to light the impact of corporate leadership styles on public-sector organisations. Known for her strict and demanding approach, her tenure exemplifies the distinctive work culture that professionals from well-established corporations often bring to their roles. This raises an interesting question: How do leaders from private corporations, academicians, and IAS officers compare in managing public-sector responsibilities?

The Reserve Bank of India (RBI) has seen a range of leaders from various backgrounds. The tenure of former Governor,  Urjit Patel, who was an academician, was marked by a challenging period that ultimately led to his resignation before completing his term. Before Mr Patel, Raghuram Rajan, also an academician, faced a tumultuous exit despite completing his term without an extension. These experiences highlight some of the inherent challenges academicians might face in high-stakes public roles, where practical governance and administrative skills are crucial.

Shaktikanta as RBI Governor

In contrast, the appointment of Shaktikanta Das, an IAS officer, as RBI Governor marked a significant shift. Arun Jaitley, the then Finance Minister, emphasised the need for an IAS officer to lead the RBI following Mr Patel’s resignation. Mr Das's tenure has been notably successful, earning him an extension and demonstrating the effectiveness of IAS officers in managing public-sector and statutory organisations. His experience in the IAS equipped him with a unique skill set to navigate the complexities of public governance, showcasing how IAS officers' exposure and experience can contribute to their success in such roles.

The effectiveness of IAS officers in public sector environments can often be attributed to their extensive experience in administration and governance. Their ability to manage large organisations and handle complex bureaucratic challenges often proves advantageous in public sector roles, where practical administrative skills are paramount.

Leadership styles

The diverse work cultures brought by corporate professionals, academicians, and IAS officers reflect their varying approaches to leadership and management. While corporate leaders like Madhabi Puri Buch bring a stringent, results-oriented mindset, academicians may face challenges in adapting to the practical demands of public-sector roles. On the other hand, IAS officers like Shaktikanta Das demonstrate that their background in administration can lead to effective management in public-sector positions. Understanding these differences can provide valuable insights into how various leadership styles impact public-sector organisations.