The decision that shook the nation overnight has lessons in leadership, risk taking and working towards an actionable vision, says Sonia Singhal.
Modi's surgical lessons on black economy caught the nation by surprise.
The initial reaction was disbelief, followed by trolls.
However, if we think deeper, here are 5 lessons we thought could be meaningful for all of us.
1. A leader’s tenacity of purpose
Here we see the classical example of a leader who has chosen to risk everything for his vision. He has already take the evaders head on through tough moves like GST, Income Declaration etc.
Modi has cared two hoots about the backlash that will follow, both against him and the Bharatiya Janata Party (BJP). The current decision, he knew, could cost the party dear in the upcoming UP elections as well as the General Elections that follow.
He said "In every nation's destiny comes a time when the actions taken have a defining impact on its destiny. We are at one such moment today."
When we talk of organisation transformation and case studies of a Jack Welch transforming GE; here is a man who has risen through the ranks and betted his fortunes on an attempt to transform a nation itself. This man is born to rewrite history.
And he has written a draft version already. We are just fortunate to watch it go live. Chapter by chapter.
2. Devil is in the details
The net addition of Rs 500 and Rs 1, 000 notes in 2014-15 accounted for over 86 per cent of all notes added. This was a serious menace to the economy.
By eliminating high denomination, high value notes we would make life harder for those pursuing tax evasion, financial crime, terrorist finance and corruption
It is not just tonight's announcement that was brilliant.
What's mind bogglingly brilliant is the two-year planning behind this.
- Within days of coming to power, he set up enquiry on Black Money.
- Announced "Jan Dhan Yojna" so that crores of poor and farmers can have their money stashed in bank accounts. 200 million accounts were opened.
- Announced Voluntary Declaration of black money for period of 1 year.
- Vision to retrieve/demonetise thousands of crores of black money from India and abroad.
- Mandating jewellers to demand PAN cards for sale of gold and jewellery.
- Force all banks to invest in Digital Banking and expansion to rural areas.
- Promote digital India, digital currency, and digital transactions.
- Close all "respectable" submission routes by today's surgical announcement.
It is not a child's play to retire two biggest currency notes within hours. It is the planning of 2 years that does not make it look immature. And that's what is brilliant.
3. Change can sometimes catch you unawares
Nobody saw it coming; or was prepared; or had even any idea of its happening.
The 8 pm announcement meant no possibility to make last moment transaction at jewellers' shop. The punters, betting thousands of crores on the US elections results, were caught unawares. The results would have started pouring in past midnight; that when all currency notes would be worthless.
Now when you go to deposit this cash into the bank, I-T department will keep record of deposits over Rs 2 lakh.
Accordingly, the department will impose penalty, which could be between 30 per cent and 120 per cent
So, what they can do with the heaps of cash is:
1. Burn it to warm themselves for the coming winter.
2. Pay taxes, interest and penalties and save as much of the cash heap as possible.
3. Find hundreds and thousands of people to deposit in banks in small sums to save as much cash as possible
4. Law of Karma: The transient nature of 'Fakes'
In our life, we often see fake people ruling the roost.
In each organisation, there exists this smiling devil who has won people’s hearts through his/her sugar coated talks.
The temporary surge in his/her popularity often leads the genuine people to question their belief system. But the Law of Karma does play its role and leads to reversal of fortunes.
It has long been alleged that terrorists and drug cartels from neighbouring countries have been supplying high-value fake currencies into India. When these fake people now go to the bank to exchange Rs 500 or Rs 1,000 notes, they will be asked for identity -- PAN and source of Income.
In a single stroke, all the fake wealth has been reduced to pieces of paper.
What does it teach us? Here's a simple test for all of us.
Ask yourself: Are you leading an authentic life? How true/fake are your actions, relationships, happiness and successes?
Will it sustain itself or crumble with time?
5. Small is Big
The person with two 100 rupee notes is today richer that a person with a thousand 500 rupee notes!
In an organisational setting, one always tends to focus on the 'big' events -- off-site events, conferences, training sessions, large cheques for variable pay etc.
However, the real gems are the small, quiet, hidden, acts we do on a day-to-day basis -- those little e-mail appreciations, the pat on the back, those cake cutting ceremonies, those birthday cards.
They are what really keeps you going during your lean times.
With a single stroke, we have decimated or at least made life quite turbulent for those who have untaxed cash income, those who smuggle fake Pakistan-printed currencies from say, Malda border, political parties who have truck-loads of cash in secure vaults and jihadis who transact primarily in cash.
It is a brilliant move. A strategy that will go down the annals of history as something remarkable, strategies that will be documented in Harvard Business School case studies.
Lead image used for representational purposes only. Image: Olivia Harris/Reuters
The author Sonia Singal is a chartered accountant and CFA. Her start-up --cajobportal.com is one of India's first finance focussed recruitment website, exclusively for CA, CS, CWA and MBA (finance) professionals.