Vikram Pandit- New CEO of Citigroup

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Citgroup, Vikram Pandit

Vikram Pandit, a Nagpur-born NRI was named CEO of the world’s largest bank. Many say that Pandit’s appointment is a rescue mission to improve the results of the bank which reported its first loss in 17 years amid a massive financial crisis. Pandit replaced the charismatic Charles O.”Chuck” Prince III.

Vikram Shankar Pandit, the son of a pharma representative and businessman, came to the United States when he was only 16 for undergraduate studies at Columbia University. After his bachelor’s degree and master’s degree in electrical engineering, he switched to finance and earned a Ph.D.  Mentors cited in a recent profile described him as a relentlessly hardworking student, the kind who relished challenges.

The 50 year old Pandit is the first person of Indian origin to scale such stratospheric heights in the financial world, which has many well-regarded Indian executives. Citigroup has operations in more than 100 countries, with 300,000 employees and $ 2 trillion in assets. Before joining Citigroup, Pandit served as president and chief operating officer at Morgan Stanley from 2000 to 2005. In 2006, he formed Old Lane Capital, a hedge-fund firm, that Citigroup acquired in April this year for $ 600 million.

Pandit faces monumental challenges at Citigroup. The situation was considered so dire that a $ 7.5 billion capital infusion by the Abu Dhabi Investment Authority last month was seen as a part bailout from the nearly $ 17 billion write-off relating to soured mortgages.

Pandit is seen as a cautious, conservative banker. Many experts say the new CEO will need not just punditry but also some wizardry to extricate the bank from the mess.

In a statement following his elevation, Pandit said he would “undertake an objective and dispassionate review of all the businesses, individually and in aggregate, to make sure we are properly positioned for the future.” He also promised to simplify the company’s organizational structure, align businesses and resources with appropriate goals, with economic realities being among the initial priorities. A sure sign that there will be some soul-searching and cleansing.

We in India wish him every success in this challenging assignment.

Indians Most Upbeat About Life

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Indian Economy, retirement

A recent issue of Business Today tells us that Indians are the most upbeat about life in the Asia region. Research from AXA Asia Life shows that 82 % of the “mass affluent” ( the top 25-35 % of the population) in India have neither started planning for, nor taken care of  their retirement needs. AXA Asia is part of the giant AXA Group.

It appears that for Indians the first priority was career, followed by health, family and retirement in  that order.

As many as 85 % of Indians surveyed were satisfied with their lives – the highest for any country in the region. The Philippines was next with 72 % followed by Indonesia at 47 %.

Another insight was that although 76 % of Indians were concerned about the rising costs in childrens’ education only 1 % had invested in education plans.

However, the survey size was not very big. It covered 2400 people aged between 25 and 50 years in 8 markets in Asia.

Voting with Their Feet

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A Step A Day, Attrition, leadership

Nearly a hundred years ago, it is said that Henry Ford was magnanimous when he rolled out his Model T car. “Any customer can have a car painted any colour that he wants so long as it is black. ” he said.

In today’s world, we as consumers have more choice than ever before. Likewise, today’s employees – and in particular top quality talent- have more options than ever before. Booming economies give them more opportunities than before. If the skills they possess are in short supply and they are not truly engaged, talented employees will vote with their feet and walk out.

How do we minimize the impact of employee attrition? I say minimize because it is simply not practical to have no attrition at all. I agree fully with a school of thought which holds that that a certain amount of attrition is indeed desirable in an organization.

For want of any better matrix, attrition has come to be computed in percentage terms. “Company ABC has 18 % attrition “we say or “The industry averages for that job is about 20 %. ” Like any other statistical data, this representation can be misleading. It means one thing for a firm having 50 people to have 20 % attrition. It means quite some thing else for an organization having 25,000 people.

To my mind, what matters more is not how many people have left but who has left. As busy managers we are responsible for the development and performance of all our team members. However, effective managers know just how important it is to get the best out of those few team members who are exceptional. It is their contributions that lifts the performance of their teams.

While we must treat every team member with professional respect, do devise almost tailor-made leadership styles to suit the needs of your star performers. They may require less supervision from you. They may want more independence in carrying out their responsibilities. Work out a leadership style which they respond best to. Having these top performers engaged is more valuable to you, your team and your organization than having a low attrition percentage amongst weaker performers.

The widely read management guru, David Maister says “Great managers give lots of responsibility early, are available to help, set and enforce high standards( on things other than just financial results), demand participation by all team members and set a high personal example.”

Follow his advice and you will not find your team voting with their feet.

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