After returning to India, I did a bit of corporate training, just as a hobby, in association with a company that ran training courses for large corporates and banks.
I was invited to conduct a three-day training course on ‘negotiation skills’ for State Bank of India (SBI)’s corporate bankers, partnering a trainer with experience in teaching the subject. My role was to provide a banking context to an existing training module. We were going to hold eight training courses at various branches and training centres of SBI all over India.
The very first session was at SBI’s corporate branch at Ballard Estate in Mumbai. This branch had a loan book of Rs77,000 crore, bigger than the entire loan book of many banks at the time, such as Kotak Mahindra Bank. The participants were senior managers of SBI—two assistant general managers (AGMs), many deputy general managers (DGMs), a few senior DGMs and one general manager (GM)—some 40 people in all.
In the very first session, I put the participants in pairs for a role-play exercise, one acting as a banker and the other as a customer. Each ‘customer’ was given a list of exorbitant demands that he was to place before the banker, such as a reduction in interest rates, no commission on bank transfers, and slashing the commission on letter of credits (LCs). The pairs were given 20 minutes to negotiate the demands and reach an agreement.
When the negotiations ended, each pair presented what had been agreed. To my great surprise, in all but one of the 20 pairs, the ‘banker’ had accepted, in full, whatever demands the ‘customer’ had made.
I asked the participants why the customer had been allowed to ‘win’, so to speak. One ‘banker’ spoke up to explain, and I could see that the others agreed with what he said.
“We have to satisfy the customer. We cannot risk the customer leaving us and going to another bank.”
“Also, the customer might complain,” said someone else.
How would I teach negotiation to a bunch of guys who were ready to give everything away right from the start, I wondered? But it was just the first session of the first run of the training course, and I had to keep mum.
In the afternoon, a lively discussion ensued, centred around what leverage a banker had when negotiating with a customer, other banks and auditors.
One participant proudly announced, “Every big project comes to us first. If we approve, all the other banks line up behind us to lend.”
I asked what would happen if SBI turned down a funding request for a project.
“Nobody else would lend, Sir,” was the confident reply.
“Oh!” I remarked. “That means you have veto power, right?”
None of these senior corporate bankers had quite seen themselves in that light, so they were unsure as to how to react.
I went on to explain, “What I mean is—you people at SBI decide whether or not a new project is viable and worthy of funding. And if you turn it down, the project is dead, because no other bank would give money. Correct?”
Most of the people nodded, though a few were still unsure.
Then I dropped a small bomb.
“If SBI is so powerful, why did all of you agree to the outrageous demands of your ‘customer’ this morning?”
There was a stunned silence while the participants glanced at one another.
I dropped another little bomb.
“If a private or foreign bank, say HDFC or Citi, had your veto power, what do you think it would have done?”
The realisation dawned on some people, and I pushed the point home.
“It would squeeze the customer for the last drop of blood, and hike rates and fees as much as it could – not agree to cuts like you people did. In negotiation, if you have power, you need to use it.”
My partner (trainer) sensed the uneasy atmosphere and quickly announced a tea break, ahead of schedule.
In each of the subsequent sessions—at Chennai, Delhi, and Kolkata—almost exactly the same thing happened. Most of the ‘bankers’ gave in to their ‘customer’, and the confidence in SBI’s veto power was universal.
Thus, within the same select band of corporate bankers, and across all territories in India, I saw two opposite SBIs—a diffident bank, anxious to retain its customer at the cost of income, and a proud bank, conscious of its overwhelming power in the corporate banking world.
This was not inconsistency between different sections of the bank—e.g., customer service at a prime non-resident Indian (NRI) branch and a small branch in a metro—but within a very niche segment of the Bank and in similar groups of people, pan-India.
All these encounters have told me that one thing about SBI is undeniable—inconsistency.
The most successful companies across the world are all known for their consistent quality and performance.
- Toyota cars have the same superior build quality, irrespective of where they are built.
- McDonald’s is present in 120+ countries, operating 37,000+ restaurants with 200,000+ employees yet its fries taste the same wherever in the world you may be.
- Even HSBC, a truly global bank, provides a consistent experience to its customers everywhere.
Clearly, size is no excuse for inconsistency.
Why the inconsistency?
Only a clear-sighted top management, consistent in its thinking through generations of chief executive officers (CEOs) and top managers, can instil the right core values in all its employees, so that the culture, attitude and customer handling are at the same positive levels throughout the organisation.
Has SBI’s top management failed to do this over the years? Is it still carrying the legacy of the old Imperial Bank’s ‘sahib’ mentality?
I leave it to you to ponder over this.
However, if I have overstepped the mark, I apologise.
From the very beginning, I have admitted that I was a ‘blind man’, forming opinions about a behemoth from a few random incidents spanning geographies and over decades.
I am not claiming that I have formed the right opinion of SBI. There must be many aspects of SBI which I have not experienced.
But whether I am right or wrong in my analysis, you will agree that SBI does not provide the superior and consistent level of customer experience that we ‘aam aadmis’ would like to have from our country’s premier bank.
I rest my case.
(Deserting engineering after a year in a factory, Amitabha Banerjee did an MBA in the US and returned to India. Choosing work-to-live over live-to-work, he joined banking and worked for various banks in India and the Middle East. Post-retirement, he returned to his hometown Kolkata and is now spending his golden years travelling the world, playing bridge, befriending Netflix & Prime Video and writing in his wife’s travel blog.)