Friday, April 07, 2006

SBI : Not Quite Surprisingly SBI

Brand : SBI
Agency : O&M

SBI is the largest bank in India, It has the largest number of ATMs in the country. The Vehicle loans cover Insurance cost also. The home loans cover furniture also. 80% of India's corporate world depends on SBI. Surprisingly SBI

SBI employees are on strike from 3 April 2006 ( after getting their salary). Even after 4 days, the strike is going on, cheques are not cleared ( my salary is still in cheque form). The largest number of ATMs are already dried up. 80% of corporate are worried about their funds. Not so surprising because it is SBI.

SBI was set up in 1806 at that time called the Imperial Bank of India.Later after our independence SBI was formed. The bank still carries the Pre- liberalisation culture which has now come to the full circle.

I am not commenting whether the strike is legal or ethical. Employees have to stand united for their rights. I am talking about the brand SBI. SBI in recent years are facing hot competition from the new generation banks like ICICI, HDFC etc. SBI was able to hold its fort against these new players because of sheer size and reach. With ICICI close to their heels, SBI took a decision for an image make over.

The customers were surprised to see the new campaigns and billboards teaching customers about SBI. O&M did a nice job in subtly changing the image of SBI from a monolith to an agile banker. But this strike have put all those money used for brand building into waste basket. SBI is facing the nightmare of all the employers of the world: strike.
SBI is going to pay a heavy price for this debacle and ultimately it is the employees who is going to get affected in the end. News reports suggest that SBI customers will look for other alternatives ( am sure most of the corporate are pissed off) , the deposits will take a run and the brand equity will be hit hard. ICICI may have already started their work on SBI clients and I am sure not much persuation is needed.
In a pure marketing perspective, this could have been managed better. There was no contingency plan in place. The notice for strike was given much before, had some alternative arrangements be made, this problem could have been solved. But efforts was to focused on strike and not on customers. If a contingency plan had been made, the strike would not have been there. Since SBI have some responsibility towards its customers, contingency plan should have been there in place. But it was not. Even if the strike ends this week , it will take another 15 days to normalize the operation which is going to cost this bank dearly.
I am sorry for the striking employees because they will get a pension only if the bank is in good health.They are making it sure that it is not.