Change Management @ICICI
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Details
Themes: Change Management
Period : 1996-2002
Organization :ICICI
Pub Date : 2002
Countries : India
Industry : Financial Services
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Case Code : HROB008
Case Length : 10 Pages
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With Kamath's stated objective to make ICICI provide almost every financial service, separating the customer service people from the product development groups was another problem area. In the current scheme of things, an MCG or GCG person acted as a clients' representative inside ICICI. The MCG or GCG person understood the client's need and got the relevant internal skill department to develop a solution. Unlike foreign banks, there were no demarcations between these internal skill groups and client service person. (Demarcation helped in preventing an internal skills person from cannibalizing business being developed by the client service group.) With no such systems in place at ICICI, this distorted the compensation packages between the competing divisions. |
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In addition, in-house training programmes were conducted in Pune and Mumbai. During 1995-96, around 35 officers were nominated for overseas training programmes organized by universities in the US and Europe. ICICI also introduced a two-year Graduates' Management Training Programme (GMTP) for officers in the Junior Management grades. Along with the training to the employees, management also took steps to set right the reward system. To avoid the negative impact of profit center approach, wherein pressure to show profits might affect standards of integrity within an organization, management ensured that rewards were related to group performance and not individual performances. To reward individual star performers, the method of selecting a star performer was made transparent. This made it clear, that there would be closer relationship between performance and reward.
However, it was reported that pressure on accountability triggered off some levels of anxiety within ICICI which resulted in a lot of stress in human relationships. Dismissing reports of upsetting people, Kamath said, 'much of the restructuring plan has come from the bottom.' ICICI also reviewed the compensation structure in place. Two types of remuneration were considered - a contract basis which would attract risk-takers and a tenure-based compensation which would be appealing to employees who wanted security. Kamath accepted that ICICI had been a bit slow on completing the employee feedback process. Soon, a 360-degree appraisal system was put in place, whereby an individual was assessed by his peers, seniors and subordinates. As a result of the above measures, the employee unrest gradually gave way to a much more relaxed atmosphere within the company.