A Makeover for HDFC Bank

The ever-smiling face of 56-year-old HDFC Bank Managing Director and CEO Sashidhar Jagdishan belies the grim determination of the man. Having stepped into the big shoes of his predecessor, the iconic Aditya Puri, Jagdishan was aware of the burden of expectations he had to shoulder. But as if that wasn’t enough, the new CEO of the bank, India’s largest in the private sector with Rs 17.46 lakh crore in total assets, walked right into the middle of a series of problems — serious tech glitches, disruption in banking services, and a hard rap on the knuckles from the Reserve Bank of India. There were two things the former HDFC Bank CFO could do: either rue his luck and get bogged down by the weight of the problems, or convert the crisis into an opportunity to make deep changes and improvements at the bank. Jagdishan chose to do the latter, and what is now unfolding is a case study in corporate strategy and transformation. The fact that he was CFO helped. As former State Bank of India chairman Arundhati Bhattacharya, herself a former CFO, had once said, “a CFO knows the blood report of the bank”. Having been groomed for the top job by Puri — and been Change Agent at the bank before his predecessor hung up his boots — Jagdishan not only knew the blood report, but also the pain points he had to address. Facing the crisis head-on, Jagdishan chose first to acknowledge the problems and then carve out a detailed strategy for change.

As Anand Adhikari writes in our fascinating cover story in this issue, HDFC Bank is now in the process of undergoing a deep-rooted makeover which seeks to eventually convert this banking behemoth into a digital-driven, nimble-footed fintech giant. The changes Jagdishan and his top team are driving cover the length and breadth of the bank — from retail lending to corporate and wholesale banking — where the power of digital is being sought to be leveraged to ensure customer satisfaction while keeping costs low. The bank has set its bar high and is benchmarking itself against the likes of digital giants Amazon and Google. Sample some bits of the strategy: it is building two ‘factories’ — the enterprise factory and the digital factory — which will enable the bank to build new architecture and new designs on the cloud to compete on equal footing with the fintech players which threaten to disrupt the banking space. Alongside, it is also partnering with fintechs like Paytm to grow in new areas and jointly tap the small merchants’ segment for payment solutions and lending. Having witnessed the magnitude of the problems, the markets are, however, waiting for tangible results. As Jagdishan plans to roll out the ‘neo bank’ in the next three years, competitors, investors and customers will be keenly examining every detail of this big-bang makeover.