CEO visions for a new banking model will fail if more pressure is put on employees. State Bank of India is taking a different approach, as Brian Caplen discovers.

Bankers talk endlessly about customer service and how it is the all-important ingredient in the new retail business model (which is a tacit admission that it wasn’t always in the old one). They talk about new organisational structures and new relationship management systems. They talk about using data to better identify customer needs and to target products more effectively.

But hardly anyone talks about how delivering better customer service is impossible unless the rank-and-file employees who deliver it are feeling good about their jobs.

The reality is that in many banks workers have more reasons to feel negative than positive. Banks have been through one restructuring after another.  They have been closing down branches, going digital and making lots of staff redundant in the process.

Senior management may be fired up about the glorious digital future but if employees feel uncertain about their jobs they will hardly feel engaged. Yet these are the people expected to deliver the new vision. Is this realistic?

With this in mind, it was a breath of fresh air when State Bank of India chairman Rajnish Kumar started his tenure by asking staff to make sure they had a good work-life balance. They should only work eight hours a day, he said, and work should be fun.

His argument is that focusing only on the desired business result is not the right approach. It is better to focus on the input – well-trained employees with a good work-life balance using the best technology to connect with customers. Only if the input is right will the output follow.

The temptation for bottom line-driven CEOs is to downsize staff too drastically and to put them under pressure in call centres and branches. This may be good for a quarter or two but the long-term bet is on Mr Kumar’s approach.

Brian Caplen is the editor of The Banker. Follow him on Twitter @BrianCaplen

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