International Journal of Management and Social Sciences Research (IJMSSR)
Volume 2, No. 5, May 2013
Effective Strategy for Organisational Development: With
Reference to Kautilya’s Arthashastra
Sathya Narayanan SR, Faculty in Business Administration, Sri Malolan College of Arts and Science, Madurantakam
ABSTRACT
This paper explores the Arthashastra of Kautilya, an
ancient Indian literature (4th Century B.C.); and it’s
perspectives on organizational management today. There
is a need to look and re-look at the ancient literatures and
provide intelligent interpretation and re-interpretation to
apply effectively in the context of modern management.
The methodology used for this purpose is called
hermeneutics; which is a study, understanding and
interpretation of ancient text. It is one of the qualitative
research methodology used in social science. The
foundations of management in organization are revealed
from the Arthashastra, which can provide guidance to
present managers and leaders of organizations especially
on the strategic applications in business process. Without
a Strategy, an organization is like a ship without a rudder,
going around in circles. It’s like a tramp it has no destiny
to reach.
Keywords:
Kautilya, Arthashastra, Strategy, Modern Management,
Organisational Development
INTRODUCTION
Kautilya the minister, scholar and strategist, belongs to 3rd
century BC has authored a magnificent treaty which is
known as Arthashastra. It is commanded even by modern
scholars as magnum opus of multiple disciplines such as
economics, administration, management, strategic affairs,
sociology and moral sciences? It is rich treasure of
knowledge and wisdom. However most of the current
research in these areas has been general in nature and not
in depth, as there is still a great tendency to research more
on the western management philosophy and its application
in ancient context. We was dominated by the theories and
concepts of modern management from west. The
dominance is due to the colonization and the widespread
use of English knowledge. However, a careful analysis of
many of the western management theories and concepts
reveals that it has been in practice in Asian countries
especially in India for centuries. These practices were not
in the context of organizational management but in the
context of state or political governance form the
perspectives of author, management is culture specific.
The Indian civilization, with recorded history of more than
i-Xplore International Research Journal Consortium
ISSN: 2319-4421 79
5000 years is one of the oldest civilization in the world
and the contribution of India and Indians to this world
enormous in various fields of knowledge, several Indian
classic literatures such as the Valmiki Ramayana, The
Mahabaratha, Bagavad Gita and last but not the least our
Kautilya’s Arthashastra etc., offers several management
lessons which can be useful even in the modern context
many of these literatures are more than 5000 years ago and
were written in the language of Sanskrit. In this paper the
Arthashastra by Kautilya, Chanakya or vishnugupta is
explored in context of contemporary of organizational
Management.
STRATEGY
Without a Strategy, an organization is like a ship without a
rudder, going around in circles. Its like a tramp it has no
destiny to reach. Strategic management can be defined as
the art and science of formatting implementing and
evaluating cross functional decisions that enables on
organizations to achieve its objectives strategic
management focuses on the integrating management in
this text is used synonymously with the term strategic
management. Its main purpose is to exploit and create new
and different opportunities for tomorrow
THE BROAD PURPOSE OF THIS PAPER
Research works in analyzing ancient such as Kautilya’s
Arthashastra in the context of modern management
practices is indeed limited because it has lot of lessons to
offer to organizational management especially in strategy.
Yet there are many managers and administrators from both
India and Abroad are not aware of the lessons of
Kautilya’s Arthashastra and its contribution towards
organizational management as the result, one of the
purpose of this [paper is to create awareness to the
management readers of the existence of Kautilya’s
Arthashastra and its management lessons as it provides
intelligent interpretation and re- interpretation to apply
effectively in the context of modern management.
METHODOLOGY
This paper is based on a qualitative research methodology
called hermeneutics. Hermeneutics is related to the name
of the Greek god Hermes in his role as the interpreter of
www.irjcjournals.org
International Journal of Management and Social Sciences Research (IJMSSR)
Volume 2, No. 5, May 2013
the messages of the gods. In the current context,
hermeneutics can be described as the interpretation and
understanding of ancient literatures and religious texts. It
is also used in contemporary philosophy to denote the
study of theories and methods of the interpretation of all
texts and systems of meaning. The concept of “text” is
here extended beyond written documents to any number of
objects subject to interpretation, such as experiences. A
hermeneutic is defined as a specific system or method for
interpretation, or a specific theory of interpretation. The
scope of hermeneutics also includes the investigation and
interpretation not only of ancient texts, but of human
behavior generally, including language and patterns of
speech, social institutions, and ritual behaviors.
Hermeneutics is widely applied in many field of social
science
Kautilya wrote his Arthashastra in Sanskrit language.
Sanskrit is one of the oldest languages in world and it has
also influenced many other languages in Arthashastra was
written for the purpose of managing a kingdom or a
country. Only five of Kautilya’s sutras or aphorisms of
management of kingdom are interpreted in the context of
management of organizations in this paper. The sutra or
aphorism system of teaching with any body of language is
unique system developed and used for many thousands of
years. The sutra needs to be commented upon, and
interpreted for correct understanding and use. For example
in explaining the Arthashastra in the context of
management, the term rajya (state) is interpreted to the
organization, the raja or king is the leader or the chief
executive officer (CEO), amatya or mantri (ministers) are
the managers of various departments such as finance,
marketing, human resources and operations
KAUTILYA’S ARTHASHASTRA AND
STRATEGY
Requirement of information
Kautilya in the Arthashastra says it is very important for a
person to be well informed, but the important question is,
why is this information required?
Coming to know what is known, definite strengthening of
what has become known, removal of doubt in case of two
possible alternative, finding out the rest in matter that it is
partly known – this can be achieved with the help of
ministers (1.15.20-21)
According to Kautilya there are four types of Information:
a) Some information we get which may already familiar
to us
b) On other cases we may get a half – bake resources,
which would require another information source to
understand clearly.
i-Xplore International Research Journal Consortium
ISSN: 2319-4421 80
c) Some times we may get controversial news, first news
which we received may be positive but next time we may
get a negative one.
d) Some times the information reached to our end may be
overloaded, or may contain Gossips, rumors and personal
view points etc.,
PRINCIPLES OF MANAGEMENT
All management theories and concepts are based on
certain principles. These essentials are the foundations
with which we evaluate if the manager has been efficient,
the organization productive, and the objectives achieved.
Kautilya, has given the most refined view of management
in a single verse, as a short as five pointers in verse 42 of
chapter 15, of book one of Arthashastra.
Starting undertakings of Assignments/ Projects
Excellence of men and Material
Find suitable place and time
Provision against risk
Accomplishment of commitment
Keep an Open Minded
The mind is like a parachute - if works only when it is
open, some of the best business ideas come from listening
to others.
Kautilya emphasizes the importance of this point for
various leaders.
“He should despise none (but) should listen to the opinion
of every one. A wise man should make use o the sensible
words of even a child” (1.15.22)
The followings are the keys for effective listening
Gather information from the top and the grass root
levels.
Never react immediately
Make use of the ideas
Managing Multiple Projects
Management guru, Peter F Drucker, in his book on the
profession of Management. Is compassionate while
describing the role of manager. He says “The role of
today’s manager is very difficult is any given situation. He
has to handle projects and assignments, He is always
under pressure”
Kautilya also advises on managing Projects and make
more profits for the compare
“And (they) should bring about the commencement of
what is not done, thjs carrying out what is commenced, the
www.irjcjournals.org
International Journal of Management and Social Sciences Research (IJMSSR)
Volume 2, No. 5, May 2013
improvement of what being carried out and the excellence
of (the execution of) orders, in the case of works”
He provide guidelines that an administrator should carry
out
Commencement of what is not done
Carrying out what has been commenced
Improvement of what is being carried out
Excellence in execution of orders
Constant Training
It is a very simple principle of the Time Management.
Utilize your evening and Night hours to learn new things,
instead of spending hem on most unproductive things like
partying , or other activities which are really meaningless.
This is where Kautilya advices us:
“During the remaining parts of the day and the night, he
should learn new things and
familiarize himself with those already learnt, and listen
repeatedly to things not learnt”
Even in organizations, other than the peak busy business
hours other times shall be used meaningfully and
effectively. This shall also be applied from Bottom toi top
levels of Management
Right Timing
There is a time for everything and everything has a time,
Kautilya makes us understand this golden age – old rule
by using a metaphor.
“The time of catching (elephant) is in summer”
This rule shall be understood by all business organizations
, many of the business are
seasonal and are dependent on various factors. It is very
essential to each organization to
understand such cycles. Then the game (Business) is easy
to play Kautilya in his
Arthashastra provides the following tips for the same.
a) Enter into the game
b) Learn from seniors
c) Plan every movement ( Time Management)
Corporate Social Responsibility (CSR)
The concept of Corporate Social Responsibility (CSR) is
well known throughout the business world today. It not
only speaks of contributions made towards the benefit of
the less privileged, but also calls for making oneself
accountable to society. May thinks that CSR is a new
concept, however in our country, kings have been
i-Xplore International Research Journal Consortium
ISSN: 2319-4421 81
practicing CSR for thousand of years Even Kautilya’s
Arthashastra speaks about this
“And those who are without relations have to be
necessarily maintained”(1.12.1)
Also Kautilya’s Arthashastra provides some tips for the
Effective CSR they are,
Take Responsibility
Contribute to Society
Encourage People
Get Stable
Everyone aims for the growth of their organization,
Expecting more projects, orders and increased turnover
and employing more people – are always the top priorities
for business heads.
Kautilya also advices:
“The policy, following which he were to see the
achievement nor the decline of his own undertakings,
constitutes stable condition” (7.1.28)
And Kautilya says that there are four types of stability
which an organisation should procure they are
Financial Stability
People Stability
Learning Stability
Vision Stability
Working in new regions
The need for expansion and growth is universal. Like
humans, even corporations want to grow, companies want
to introduce new products, explore new markets, and grow
in their turnover, but when a company wants to expand
into new territory, it has to send people into the regions
first.
“He should provide one making a new settlement with
grains, cattle, maoney and other things” (5.2.4)
Research of scope for expansion
Assign the expert team for field visit
Plan the moves in phases
Commencement of operation
Time Management
We are in the world of fast now, with a dire need for
effective time- management. But one can always learn
from Kautilya’s centuries old Arthashastra. According to
him being mindful of what we have to do is the biggest tip
for managing the world.
www.irjcjournals.org
International Journal of Management and Social Sciences Research (IJMSSR)
Volume 2, No. 5, May 2013
Kautilya had said:
“Thus, he (administrator) should be cognizant of the
number of animals”(2.29.15)
Here the cognizant means being aware of responsibilities,
and being in control of them. Hence in this line Kautilya
says that, at any given point of time, the head or the
administrator should know the exact timing required for
the accomplishment of the commitment
Also he laid down some guidelines for the effective time
management concept
Understand the determined goal
Note everything (Assignments)
Prioritize the commitments
Check the list regularly
Ensuring Growth
Being an expert in the field of Administration, Kautilya
could communicate exactly what a leader or an
administrator is expected to do to ensure the growth of his
kingdom.
“There is no country without people, and no kingdom
without a country” (13.4.5)
Here the person stands for customers and clients, Country
for Market and finally Kingdom is for The Company. So
Kautilya strongly advocates that giving more importance
towards the Customers and clients, Market and The
Company will ensure the growth and stability of a
business organization.
i-Xplore International Research Journal Consortium
ISSN: 2319-4421 82
These are all the strategies provided in the Kautilya’s
Arthashastra in order to get a better position and for the
sustainable growth to a business concern.
CONCLUSION
Kautilya’s Arthashastra is one of the ancient Indian
literature which had provided some insights to
management, although the context it was written was for
kings to govern the state. There are many Strategic
management concepts from Kautilya’s Arthashastra,
which are still applicable in today’s organizational
development. A deeper study of the book will open many
new areas of management concepts, which is yet to be
known and practiced in the modern management.
REFERENCES
[1] Harold Koontz and Heinz Weihrich (1990) Essentials
of Management, New York; McGraw – Hill
publishing Company.
[2] George R. Terry (1960), Principles of Management
(Illinious: Richard D Irwin, Inc.)
[3] Law Narender Nath (1913), Studies in Ancient Hindu
Polity, Indian Reprint Publishing Company, Calcutta.
[4] Kangle R.P (1965), Kautilya Arthashastra, Part III,
Motilal Banarsidass, New Delhi
[5] Foyal, Henri (1908), Discourse on “General
principles of Administration
[6] Shamasastry M. Kautilya Arthashastra, Chowkamba
Publishers, Varanasi.
[7] Subramaniyan.VK, Maxims of Chanakya, Abhinav
Publications, New Delhi.
www.irjcjournals.org