When
Maharaja Sayajirao Gaikwad III of the princely state of Baroda
established the Bank of Baroda in 1908, he could not have
known that a hundred years down the line the logo he chose
with such care would be changed in the blink of an eye. And
the reason stated: the old logo was not in sync with the market
conditions. The question that one may ask is how can a hundred
year old logo be out of place in an industry that is almost
just as old. When the Bank's top management in 2002 sought
the answer to this question, the answer was an eyeopener
to say the least.
Bank
of Baroda, since its inception, has been one of the most prominent
banks in the Indian banking industry. Restricted to the Baroda
region in the preindependence days, the Bank expanded rapidly
once Baroda was merged with the Indian Union. Its bluecolored
logo depicted an ear of corn and a cogwheel (symbolizing agriculture
and industry), and an upraised hand, which blessed the populace
stating "akshayyam te bhavishyati" ("thou shall
forever be prosperous" with Bank of Baroda) (Exhibit
I). During the phase of nationalization that the Indian banking
industry experienced after the 1960s, the Bank of Baroda remained
one of the premier banks of the country.
When
India liberalized its economy in 1991, the banking sector
was opened to private as well as foreign participation. The
industry witnessed an influx of new players; amongst them
were some of the leaders of our current times, namely, ICICI
bank and HDFC bank. Others were renowned foreign banks. Public
sector banks (PSBs) like Bank of Baroda, which until liberalization
had operated in an environment of "symbiotic existence",
suddenly found themselves in the midst of a cutthroat market
where each player was trying to grab the largest piece of
the consumer pie. The new banks leveraged technology and customercentric
practices to boost their market share while, public sector
banks, burdened by NPAs (nonperforming assets), powerful
employee unions that prevented layoffs, and obsolete technology,
were unable to keep pace with the changes. The governmentowned
banks are estimated to have lost 12% to 15% of their customers
to private players during the late 1990s. But the one unreplicable
advantage that public sector banks continue to have over the
Indian private banks is the large network of branches that
they established during the 1970s and 80s. Try as they might,
banks like ICICI, HDFC, ABN Amro, have found themselves at
a loss in their attempts (not the least of which was the signing
of Amitabh Bachchan as ICICI's brand ambassador) to overcome
this disadvantage. |
