Devil in Pinstripes (21 page)

‘If you want I can draw up the new structure and give it to you. You can refine it with your thoughts and then we can see how it goes.’ Gowri looked at him. He had a look of disbelief on his face.

Slowly he nodded his head and moved away from his laptop. ‘I would love that.’

At that very moment Hari walked in. It was his last week in office in India and he was moving out of the country to his next assignment early next week. He looked at Gowri and a smile appeared on his face. ‘Hey buddy! Congrats man!’

Hari gave a strong handshake and hug to Amit. Gowri had a bewildered look on his face, wondering why this guy was congratulating Amit. He stood up from his chair. What’s going on? He had no clue. Seeing Gowri’s puzzled expressions, Hari figured out that Gowri did not know about it. ‘Haven’t you seen your mail box? Please read and then congratulate this man here.’

‘What for?’ he thought to himself. Anxiety was gripping him by his jugular vein as a voice inside him was saying that something is just not right. He frantically signed in and began searching for the mail. It is usually at such moments when you really want something that very second, that the computer tries all its tricks with you. Gowri’s computer was no different. Three minutes of slow internet connection and two minutes of the computer hanging later, he finally found the mail. ‘There it is,’ he whispered as he opened it. Amit wanted to be in front of him to see his first hand reaction and thanks to Hari, his dream was just about to come true. According to Amit’s over-imaginative brain cells, Gowri’s eyes popped out like Bugs Bunny, and his jaw dropped down on the floor while he went through the mail.

He turned around to face Amit. The look on his face belied his thoughts. ‘Congrats’ through gritted teeth was all that he could manage to say.

‘Thanks Gowri. Do you still want me to come up with the changed organisation structure? I can still do it for old time’s sake.’ This time, the sarcasm didn’t miss Gowri. He didn’t like what he saw and heard. Gowri was looking forward to pinning Amit on the mat, but the guy had escaped from his clutches.

Satisfied to the core of his heart, Amit came out of the room. He picked up his phone and sent two messages. The first one was to Chanda. Chanda saw it and smiled. It said: ‘Love you’. The second was to Aditya: ‘Thanks Aditya for being what you are. I know I should not have doubted you. Apologies. I am human too. Thanks for all that you have done for me.’

With a spring in his step, Amit walked back into his room, closed the door and crashed into his comfortable plush leather chair. Rocking backward and forward, Amit’s mind started reflecting on all that had happened in the last few years at NFS. Life is a big leveller. You win some battles, you lose some. As long as you win more than you lose, you are doing okay.

His thoughts went back to the night at Out of the Blues with Aditya . . . the moment when Aditya told him about the proposed change. He was not very gung-ho about this till Aditya told him it was to be an independent function that did not require him to be reporting to the MD of NFS. That had swung it for him.

‘When I heard the imminent structure change at the global conference, it was a great opportunity for me to fix all issues in one go. You and Gowri had problems, Manish wanted to move on . . . he has done the role for too long. If I had to give you Manish’s job, it was essential for Manish to move on to get the Singapore job. It ends your pain and Gowri gets to run what he built. Everyone, with the exception of Gowri will be happy when they see this.’ Aditya had told him that night.

He was a great manipulator. A people’s guy, who would do anything to ensure that his people remained happy. At least his people thought so. Thought detractors argued that Aditya always did things for his own good, and in the process ended up incidentally helping a set of people.

Amit’s train of thoughts rushed back to the night he had dinner with Aditya. On the way out when he had opened the door of the Honda Accord for Aditya, he heard a familiar voice from inside. At that time he had wondered what Manish was doing inside the car. But he quickly realised that he was a link in the chain – a critical one if everything had to fall in place. Aditya had influenced three moves in order to make life easy for him.

Beep-beep. The beep of the cell phone interrupted his thoughts. It was a message from Aditya. ‘Call me.’ He instantly dialled the number.

‘Aditya, thanks for this. I will not let you down.’

‘If I had any inkling of that sort, you wouldn’t be here my friend.’

‘Thanks Aditya.’

‘Listen Amit, stop being so grateful. There was a vested interest for me in this entire deal. I need you there. As much as you want the job, I necessarily want someone there who can counter Gowri. Who can fight his aggressive persona . . . someone who can push him back. A balance is required in that organisation, or else Gowri will go on a rampage. Who else can do this but you? Given your history I do not think Gowri will screw around with you. He would have walked all over Manish Kakkar despite the change in reporting lines. With you at the helm I don’t think he can do that. It will only help my business.’

Amit smiled. He knew that Aditya always had a rationale for everything. Just when their discussion ended, Manish walked into Amit’s office. The usual bonhomie, the excitement, and the rara followed suit. The only one with a sullen face during the entire episode was Gowri.

Over the next thirty days, Hari and Manish transitioned authority to Gowri and Amit and moved on. The NFS they left behind was a potentially volatile, but hugely viable business. If run properly it could be a cash cow; however, the Amit–Gowri personality issue held in it the potential to derail the company while also holding an opportunity to make it soar to greater heights.

A
ditya’s intent at putting Amit in there as a counter balance for Gowri seemed to be working. Seldom do you get such powerful personalities working in opposition to each other, and yet collectively accountable. And if you do, it would always lead to clashes, difference of opinion and eventually to an overall improvement of the organisation. Some would call it positive turbulence . . . Aditya surely did when he put them together . . . or was it, against each other?

Amit and Gowri spent the first six months in trying to get at each others’ throats. For the first time they were real adversaries with a difference – this time they couldn’t take undue advantage over the other. In round one, Gowri held the edge. He was the one who had things under his control and unfortunately, at least in the beginning, Amit had to use all the tricks he could think of to wrangle things out of Gowri’s stronghold. Not anymore though.

This was a stage where both of them were equals. Gowri ran the sales and business side which he controlled tightly and Amit ran the credit part, which in turn acted as a check on Gowri.

Both of them set about strengthening their own empires. Gowri already had one – an entire empire, of sales guys, branch guys, service personnel . . . in effect, he had the entire branch team eating out of his hands. Amit inherited Manish Kakkar’s team, which was also spread out all over the country in the branches of NFS. This team of credit and collection managers was involved in processing of loan applications, approving the loan applications and even in collecting the money back from customers who defaulted on their loan commitments. This being a role that Amit had never undertaken before, the learning curve was enormous and the power to control was addictive.

Initially, his team was apprehensive. In the past, they were used to listening to the branch managers. Even their performance appraisals were indirectly controlled by the branch managers. For them life began and ended at the branch manager’s doorsteps. Gowri, had all along been seen by all of them as the person to please . . . the person who held the reigns to their career and could determine the pace at which they could gallop from one level to the other.

Amit had to change all this. He had to build a certain amount of trust in his team. To get them to start functioning without being dependent on the business guys was not easy. The team lacked self-confidence and he had to make them believe in themselves and build their own distinct character. The credit and risk team had to have a separate identity as against the branch network.

This change couldn’t wait. He got down to work, the day he took over. Sitting down at his table late at night he typed out a message. It was his first day in the new role.

Dear Team,

We are at a stage where the organisation has in its wisdom made some sweeping changes in the way we do our business. As you are aware, we have decided to bifurcate business into two independent verticals – Sales and Credit & Risk. This has been driven by the need to balance and the necessity to grow quickly with adequate controls – checks and balances. We do not want the aggressive growth plans to pressurise the credit team into approving loans which they should not be approving.

I know in the past many of you have been operating under the instructions of the branch managers and at times have even been rubber stamping whatever the branch managers wanted you to approve. This will not be tolerated anymore.

You need to change the way you work. All of you are now a part of the credit function and to that extent you are different from the sales guys.

I am hereby enclosing the revised organisation structure. Your lines of reporting and governance model is attached hereunder.

With immediate effect, all the loan approving authorities of the branch managers are being withdrawn. Only the credit team in the branches will have the authority to approve these loans. Anyone succumbing to pressure from the branch managers and approving loans under the influence of the sales guys will be dealt with appropriately. You will only approve loans which fall under the prescribed policy.

If anyone has an issue with this, please discuss with me. I expect this to be implemented in true spirit. Any deviation will not be tolerated.

Regards
,

Amit

He copied Gowri on the mail which was sent to the branch managers and to the entire credit team. Gowri, as usual, seriously objected to the manner in which the mail was written. Like one of those irritating kids in school, he immediately rushed to Aditya, his new boss, whining and complaining about Amit. But Aditya asked him to lay off. Being the proactive guy that he was, Amit had run the mail past Aditya and taken his sign-off before he released it.

This mail did two things for the team. Firstly, it established complete clarity on the reporting structure. And secondly, by taking the authority out of the branch manager’s hands, and putting it solely with the credit guys, it elevated the status of the credit folks in the organisation. Now the branch managers were at the mercy of the credit folks. Earlier it used to be the reverse.

Credit in any organisation is supposed to be made up of guys who are not capable of being in sales. Such was the perception of the credit department in NFS in those days. There were many other organisations in India where credit guys had moved on to become more dynamic and aggressive, but in NFS it was boring . . . boring because it consisted of people who had no energy, no drive and who preferred to live in the shadow of sales. Amit tried to change all that. His experience in sales helped.

First month in office, he roughed it out on the field. He travelled to every corner of the country. He met the sales and credit guys in one forum, in which he discussed sales-related issues and also what sales needed to do to ensure that the credit team is able to do their job better. No one in NFS had done anything like that before. It always was about what credit should be doing to make the job of sales better and easier. He brought in a fresh perspective.

At NFS, conferences and sexy off-sites were reserved for the business guys. The people in the credit and collections departments were invited on a need basis. Amit turned this system on its head. He organised off-site get-togethers and parties for the credit and collections teams and invited a few guys from sales to be a part of it. He charged up the entire team towards a cause. Manish Kakkar did not have the luxury of an independent team. He always lived in the shadow of Gowri. Amit did not need to. He had a mandate from Aditya and he went about executing his mandate.

Amit also infused fresh talent from outside. It suited him because they didn’t come with any history in NFS and were from the beginning, more aligned to him than to the branch managers, Sangeeta or Gowri. It was easier to mould them to his vision than anyone from within the organisation.

He went about meticulously creating an organisation which was conscious about quality, integrity and controls even if it meant conflicting with Gowri’s aggression. The credit team, over a period of time, started to look up to him and began to believe in his words and leadership.

Rajesh Krishnamoorthy was one such talent that Amit discovered. The latter was with GE as a branch credit manager in one of their branches in Delhi. After a lot of persuasion, Amit managed to convince Rajesh to shift from there to NFS. Rajesh too had heard a lot about Amit and that was one of the reasons why he joined NFS. Otherwise, from his perspective the brand pull of GE was much stronger and more attractive. Wanting to be a part of a revolution, he took a leap of faith and joined Amit’s bandwagon. Amit was out to change the organisation and Rajesh was keen to participate in the process.

Rajesh joined as the regional credit manager for Chennai. With twelve huge branches in the city, the business of NFS was very well established in Chennai. As in any other city, the branches in Chennai too were run by individual branch managers who reported to Jagmohan Awasthi, better known as ‘Jugs’. He was the regional sales manager for the Chennai region. At Gowri’s behest, Chennai was carved out as a separate region . . . only to elevate Jugs to the position of a vice president. In the process, Jugs became the only city head who was of the cadre of a vice president in the organisation. His closeness to Gowri was known to everyone. Even Sangeeta, to whom he reported, had little control on him.

Jugs was a cow-boyish clone of Gowri and believed in pushing the credit folks to the extreme to approve loans irrespective of the merits of the case. Normally, most sales guys do that, but as you reach the level of a vice president, one is expected to exercise some restraint and balance. However, Jugs belonged to an entirely different species. He did not know what restraint meant. He would go after the credit guys asking them to approve every case, every application and often fire from Gowri’s shoulders.

Rajesh was the new guy in the picture and early on he was pitted against the aggression of Jugs. Being an amenable and practical person, he would argue every loan case logically and if questioned, would come out with a rationale on why the loan applicant was declined. Rajesh’s logic was often sound and couldn’t be questioned under normal circumstances. This led to some friction with Jugs, as Jugs could no longer have his way . . . and soon, it started impacting business.

The Chennai sales numbers started dwindling. Jugs, a man who had never been behind on his monthly targets ever in his career, started feeling the heat. Gowri began asking embarrassing questions to Jugs for which he couldn’t provide any retort. Conveniently, he started putting the blame solely and squarely on Rajesh. For Gowri, it was difficult to absorb the fact that a credit guy was impacting the business numbers in Chennai and as a consequence, the Jugs–Rajesh war got escalated to Gowri and Amit. When it reached their levels, they had to take stands. Each one protected his own guy. Amit backed Rajesh to the hilt; after all, he had hired him in the system.

When Gowri couldn’t influence Amit to do something about Rajesh, he was pissed and asked Sangeeta to do a review of all the loan applications which had been declined in Chennai and figure out if any of them could have been approved, if at all. Sangeeta flew into Chennai for a couple of days, picked up all the rejected applications and sat down with the credit team to review them. The due diligence with which they had executed their work (thanks to Amit) was so thorough that she just couldn’t pick out anything to complain for. Despite not wanting to, she had to go back to Gowri with a report that the loans which had been declined deserved to be declined and that they needed to change the way they sourced their applications for loans.

‘Our DSAs in Chennai are not sourcing the right kind of loan applications. They need to be trained to source quality customers,’ said she in her report to Gowri. She also made it slightly caustic because she didn’t like Jugs’ closeness to Gowri. In this case she saw an opportunity to get back.

DSAs – Direct Sales Agencies are the backbone of the loans business for any bank in India. They contact the customers, get the applications filled, and mediate between the customer and the bank. The bank pays them a commission based on the value of the loans that they source.

This, over the years, has led to the mushrooming of many fly-by-night operators who masquerade as DSAs and pump in fraudulent loan applications into the banking system. These customers then avail of loans and after paying a few monthly instalments disappear, never to be traced again. Banks are then forced to write off these loans and incur a loss. To get over this menace, banks manage all direct sales agencies and oversee the executives working in the DSAs very very carefully. They even lay down a list of do’s and don’ts for the DSAs and conduct regular audits to see if the DSAs are following the processes outlined by the bank.

They also hire fraud prevention agencies which in fact put in fraudulent applications into the DSAs to see how the channel reacts to it. (They are referred to as ‘seeding of applications’ in banking parlance.) This helps the bank identify weaknesses in their control process. If a seeded application makes it to the approval stage and does not get identified as a fraud and declined before that, it indicates a weakness in the bank’s approving process. The bank would then work on fixing the gaps. This process is useful in exposing agencies which indulged in unfair practices to get these applications through. If any executives are found to be indulging in frauds, they are normally dismissed immediately and blacklisted. Banks do not accept any further applications from such executives and even applications from this executive which are in various stages of processing are declined immediately.

The logic for this is very simple. All applications received from a fraudster sales executive, are very likely to be fraudulent and hence banks do not risk their money by giving out loans to applicants who have come through executives who have been identified as frauds.

NFS, given its nature of business, also had a very interesting manner of evaluating a customer’s credit worthiness. Every customer who wanted a loan would be called to the branch and met by credit officers. They would meet him, check his documents (bank statements, documents which support his source of income like pay slips, income tax returns, etc.) to ensure that they are not fraudulent, interview him, draw up a detailed income and expense statement for the customer and on the basis of that, if they conclude that the customer would be able to pay the instalment for the loan, they would approve the loan and give him the money. Else, they would decline it. They would also refer the customer to a credit bureau to check his performance on loans with other lenders to ensure that he was not a defaulter with them. A rather manual way of doing it, but in a country like India there is no other alternative.