Page 194 - DMGT520_ORGANIZATION_CHANGE_AND_DEVELOPMENT

Unit 14: Future Trends in Organization Development

Notes
 International teamwork
 Strong capital and financial position

 Conservative, sound risk management
 Disciplined expense control
 Ethical behavior, observing the letter and the spirit of rules and regulations.
Disciplined expense control: We put a lot of emphasis on ethical behavior a lot, before
Mr. Spitzer started American institutions to be likewise, and we have got rave views
about that way of behaving. Sometimes it is quite difficult to determine what the spirit of
Regulation is, and it is not just about India, but where we are able to get to the bottom of
it, we do try and adhere to that and it is very much a group tenet driven, again, from the
top. Binding and brokerage are something new to our bank—it’s relatively new in HSBC.
Our brand is built on reputation, trust, consistency and increasingly, we like to think, on
simple products that deliver value for money.
The growth of the brand has been quite spectacular in terms of how it is being measured
by Interbrand, but there is still a long way to go. Coke has a brand value of about 63
billion; HSBC has brand value of about 10 billion, according to Interbrand, and our market
caps are about 220 billion, so if we could raise our brand equity to the level of Coke, we
would significantly alter the value of shareholders’ money. There is a lot of value to be
had by driving the brand. It is relatively new. We were a federation of banks that held on
to their own names, but we have now become the 33rd most valuable brand in the world
and still climbing. It’s very evident, though, that the brand is being built on the HSBC
hexagon logo, which is displayed in airports around the world.
The next stage is to bring that brand to mean something in terms of consumer experience.
That’s something we are working on very actively, and one of the places in the world
where we are ahead of the field is in India. The Chairman set out to have an objective of a
three-legged stream in terms of revenue and it can be seen that he has pretty much achieved
that with 1/3rd of the revenue coming from the Americas, 1/3rd from Europe and 1/3rd
from Asia. So that’s been a significant change from the position in 2000, even when the
revenues from North America and South America were considerably less, with very much
reliance on Europe and Asia.
Promoting the Brand Globally
This was a strategy that was again top driven, and has been executed to deliver us the
position that we are in today. In terms of managing the group, we have a matrix structure.
We looked to have a common technology platform, but on the subject of technology, the
developments here in India have dramatically changed the technological playing field as
far as banks are concerned. We have very strong focus on our cost discipline; increasingly,
we are stressing the importance of developing human capital. And also – relatively new
for us – we are becoming marketing and sales led organization.

Our Strategy: The matrix – management is led by customer groups with key geographical
and regional axes, and it is bound together by collective management, initially composed
of the international managers around the globe. And they were put into various
acquisitions. But increasingly we have now developed a global talent pool and we are
using that, rather than the international management cadre, to bind in our acquisitions
and to drive growth in our key markets. Our customer groups essentially encompass
personal banking, financial services, consumer finance or private banking on the individual
side, and the corporate investment banking and commercial banking on the wholesale
side.
Contd...

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