Leading state-owned lender, Bank of Baroda (BoB) has appointed global management consulting firm McKinsey & Company for getting business process & re-engineering (BPR) advisory services. The multi-crore contract for rendering BPR consultancy to BoB was assigned to McKinsey around June 22, 2009. BoB has internally named the BPR exercise as ?Navnirman?.
A consultant at McKinsey in-charge of BoB-BPR project conveyed to FE that a team of McKinsey advisors have already initiated series of discussions with senior BoB executives based at the bank?s Bandra-Kurla headquarters in Mumbai in a bid to lay a 2-year long strategy to rejuvenate and turn around the bank?s working style.
Confirming this latest development, a senior executive of BoB said, ?Till November 2009, McKinsey is likely to focus on diagnosing the prevailing reporting hierarchy and decision making structure among senior executives in our bank?s crucial departments.?
He said, ?Under the ongoing BPR project, over a period of time, we want to elevate the working style of BoB executives at par with the reporting methodology prevailing among senior executives of the multi-national banks.?
BPR mainly focuses on cutting down the turnaround time of key executives in order to accelerate the customer service process. The decision process by executives thus becomes swifter as ?direct reporting? gets momentum since multiple layers of authorities get eliminated or restructured eventually. Due to the optimum use of technology and right skilling of the existing manpower, the entity after undergoing the BPR exercise tends to yield maximum customer satisfaction and improve its profitability.
Incidentally, BoB underwent a cosmic cum rebranding exercise before four years. The bank?s 100-year old logo was replaced by colorful ?Baroda Sun? on June 6, 2005 as part of the revamping strategy and cricketer Rahul David was then appointed as its brand ambassador. The Rs 20-crore makeover was mainly aimed at projecting BoB as a modern and techno-savvy bank, wooing the young generation in its banking fold. The impact of rebranding exercise helped the bank to arrest its plummeting market share. BoB thereafter regained number three position among peer banks in India, moving up two places in terms of key performance indicators.
The latest BPR initiative of BoB is expected to bolster its image in the global markets. BoB, the first Indian bank to penetrate foreign market in the year 1953, is likely to open at least 10 overseas branches in the current financial year. Currently, BoB operates about 74 offices spread across 25 countries. The contribution of overseas business to the bank?s total business was around 23% as on March 31, 2009.
As on March 31, 2009, the total assets of BoB were Rs 22,74,06 crore?a 101% rise over 2006 when it underwent a brand makeover exercise. For fiscal 2008-09, BoB?s net profit and total income were Rs 2,227 crore and Rs 17,849 crore respectively. The bank?s net profit and total income increased by 229% and 131% respectively in the last three years.