In a rush to outsource everything, some companies can overdo it, says Devender Maggo, Manager of Corporate Operations at ICICI Bank Frankfurt., a subsidiary of ICICI bank Ltd, an Indian company with operating in 19 countries including India, North America, the UK and Continental Europe, the Middle-East, South Africa, South Asia and Hong Kong. In this Profit through Process podcast, Maggo discusses how ICICI distributes processes between Germany and India, and gives advice to others on what constitutes outsourcing success.

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Podcast Transcript:

Six Sigma IQ: First of all, could you outline what your current role at ICICI Bank entails?

D Maggo: I started the back office operations for the Frankfurt branch way back in December 2007 and we started with the retail operations, which included online banking. It was part of our strategy to just move in and start with the retail channel. I was sent there from India to set up the back office operations and, after successfully implementing that, we started into asset AINA where we have some good clients with that on the asset side. I was responsible for setting up the business for the asset side.

Six Sigma IQ: What have been the key drivers for you in designing the German operations of ICICI Bank and the business process?

D Maggo: I think the key there was for me to have a best-of-class know-how along with the existing set up that we have in our parent company. Germany being a stable market, a non- English speaking market, we wanted the local expertise and aligned the same with our Indian parent company. So we were looking for out-of-the-box thinking, because, as it was a new location for us, we wanted someone to just think anew, and not just implement things.

Six Sigma IQ: What challenges have you faced in realising your goals with regard to synergies, efficiencies and transparency?

D Maggo: The biggest thing, if I can just say is the cultural shock. We have been in diversified business lines present in many countries. The biggest thing or the success factor is how you align the two different cultures when you are working in India or any Asian country. We have most of the employees who are European, rather Germans, and aligning them with our Indian counterparts or the counterparts in UK, that was the most critical. And I think once we successfully did that, it was no challenge for us but just to ensure that it’s a smooth and a clean experience for everyone.

Six Sigma IQ: How do you use Business Process design to ensure local regulatory frameworks and compliance demands are served?

D Maggo: First of all, I think the compliance and the regulatory side here is very, very transparent. The best part was that when we started wherever we felt that we need any assistance or help, the regulators were always open to us for handling of our queries and everything. But once we understood, we tried implementing everything in the system so that, first of all, there is no manual thing. There is indication of all the systems so that there are no loopholes left unattended. Secondly, a good approach that we have followed is that before any regulators come in, or anything, we are keeping a self check on everything, whatever we
are doing, just to ensure that what we have understood and what is required by the regulators are the same and there are no gaps or loopholes left unattended.

Six Sigma IQ: If you were to pinpoint your three biggest achievements using your methodologies to drive benefit delivery across the business for competitive advantage and to ensure value at an operations and strategic level, what would they be?

D Maggo: In the last three years, we are quite young in this German market, if you see us compared to some other banks. But we have done significantly good, especially once we moved to more test awards for two years, and the awards were approved so that first of all we have delivered on the customer expectation side with whatever processes, know-how, knowledge, implementation of processes - whatever we have done. The customer part is taken great care of. Second, we strongly believe that with our processes in place, we are nearly or achieving the Six Sigma. Third, Europe is a very unforgiving market as far as customer service is concerned. We are just ensuring that in spite of keeping low cost operations, we have to achieve the best of results. And we have a good mix of a European counterparts as well as Indian counterpart, wherein the front end of our customer handling services is attended by Germans and the back office operations are handled in India.

Six Sigma IQ: What key learning points can you offer from your experience?

D Maggo: That’s a very tricky question. There are a few examples, which are available in the market, from where you can study, and you can actually implement what should not go wrong in your business processes. I think one of the best things that we all are aware of is that when we are doing any sort of outsourcing, or whenever we are sending any processes to India, we need to understand how much we can send it or how much things can be done in India vis-á-vis what should not be done there. Because that is the most critical question.

In a run to outsource everything, probably people just send things which are not required, and I think a couple of banks had that experience in the past wherein outsourcing was done for everything and later they realised that it’s not working. You have to just keep your feet on the ground. You just can’t do anything and everything. You just have to be a little aware about what you’re doing, consciously taking calls thereon.

Six Sigma IQ: Some good tips there. Finally, I understand that you’re going to be speaking at our Business Process Excellence in Financial Services Conference in Frankfurt, we’re delighted to have you on our speaker agenda. Why would you say that this type of event is important right now, and what do you personally hope to gain from taking part?

D Maggo: First let’s talk about the giving side. I think that not many Asian companies or Indian banks or Asian banks are there in the European market. One of the reasons I want to be there is to share the experiences that we had in the past. This probably might be a guiding star for many other banks and organisations that might come in, because whatever we read in books, and when you are giving your first time experience are two different things. But its the sharing of our experiences and what we have done to achieve wherever we are. So clearly I think it will be a good opportunity to meet the other responsible people in the business line, and to understand from where they come and what the different ideas are that they come up with. And probably I think there is a big possibility of mixing up the best of two words: that is, the European process orientation approach and a low-cost approach driven in Asian countries, which together can make a good platform for any of the business processes.

Please note that the views expressed in this interview are those of the speaker and not of ICICI Bank.

We do all we can to ensure accuracy within the translation to word of audio interviews but that errors may still understandably occur in some cases. If you believe that a serious inaccuracy has been made within the text, please contact +44 (0) 207 368 9425 or email helen.winsor@iqpc.co.uk.