Rajat Gupta was formerly a managing director of McKinsey & Company, a director of Goldman Sachs, Proctor & Gamble, and AMR. He was also a well-known philanthropist but was found guilty of engaging in insider trading. The case explores how Gupta rose in his career and how he faced his legal problems.
Paul M. Healy; Eugene Soltes
Harvard Business Review (117004-PDF-ENG)
December 19, 2016
Case questions answered:
- What qualities do you think clearly delineate Rajat Gupta as an outstanding leader throughout his career?
- Is there any evidence in the case of the future integrity problems that Gupta would face?
- What are the errors that Gupta might have made later in his career after stepping down as Managing Director of McKinsey?
- What is the nature of the case against Gupta? Why do you think he has not accepted his guilt?
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Rajat Gupta Case Answers
Rajat Gupta Case Study
Rajat Gupta, former managing director of McKinsey & Company, a director of Goldman Sachs, Proctor & Gamble, and AMR, and a well-known philanthropist, was convicted of engaging in insider trading.
The case explores Gupta’s amazing rise and the later legal problems he faced in a country that gave him a career and a fortune. The case explores how a prominent and successful executive can engage in misconduct. In addition, the case explores the nature of illicit insider trading and how an icon can have his career destroyed overnight.
Gupta has an amazing personality, and in some ways, his life’s journey borders on the unreal – losing his parents while still in school, being selected to the prestigious Indian Institute of Technology, Delhi, being accepted to Harvard Business School on a full scholarship, landing a job with McKinsey and going on to become the organizations first non-American Managing Director. Consultant, businessman, philanthropist, and firm family man Rajat Gupta is an icon, or should we say, was?
1. What qualities do you think clearly delineate Gupta as an outstanding leader throughout his career?
Rajat Gupta comes across as an outstanding individual right from a very young age. He seems to thrive under adversity. He lost his father at a young age and his mother soon after. He still managed his school very well and made it to the prestigious IIT-Delhi with a rank of 0015.
One has to be an Indian to understand the significance of this achievement. An interesting event not mentioned in the case is when Rajat Gupta was asked to leave his school as he had a severe skin ailment (eczema). He dropped a year and returned to continue his schooling only when cured.
An important characteristic for any leader to have is fortitude, persistence, and an ability to keep going when the chips are down. We see all these traits in Rajat Gupta, coupled with an unparalleled intellect.
He made it to IIT – Delhi and then seems to have cruised through Harvard Business School, even while being the youngest in his class and just one of three Indians in his class. At IIT-D, Delhi, he even made time to woo and later marry the only girl in his batch.
Gupta is described by his class fellows as a nice guy who wants to help others. This seems to manifest itself in later years, as he was actively involved in major philanthropic activities throughout the world, rubbing shoulders with the likes of Bill Gates, Bill Clinton, and even Kofi Annan.
McKinsey was indeed a hard place to work and followed an up-or-out policy. An employee either got promoted or was advised to leave the firm. Rajat Gupta thrived in this hyper-competitive environment. He seems to have done extremely well whenever he throws a challenge.
Some of the leadership traits that distinguish Rajat Gupta are…
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