PNB HOUSING FINANCE

LIMITED: TOWARD
SUCCESSFUL
TRANSFORMATION

PRESENTED BY: GROUP 9

23P005 Akarsh Jain

23P009 Antas Palash
23P021 Kartik Jain
23P028 Nakashtra Gupta
23P040 Rahul Mishra
23P059 Vasu Gupta
CASE OVERVIEW
Historical Context
• NHB established in 1988; housing finance industry
emerged.
• Banks held 63% market share in FY 2015; had
superior networks.
• HFC challenges: Building trust, brand, innovation;
tech adoption.
• Housing finance sector vital for GDP; high growth
potential.
• HFCs struggled for long-term funds post-2008
crisis.
• PNB Housing Finance Ltd. founded in 1988;
subsidiary of Punjab National Bank.
• Strategic partnership with Destimoney in 2009;
Carlyle Group acquisition in 2015.
• Presence in 38 cities, 17 states; rapid loan
portfolio growth.
• Offers housing loans, fixed deposits; caters to
diverse needs.
• Outdated Processes
• Poor Technology Infrastructure
• High Non- Performing Assest
• Cutlural Resistance to Change
• Infrastructure limitation
• Ineffective Communication
Challenges Faced
• Enhanced Operational Efficiency
• Improved Customer Satisfaction
Metrics
• Positive Cultural Shift
• Financial Growth and Stability
• Increased Market Share
Results Acheived
• Project Kshitiÿ
⚬ Business re-engineering process.
⚬ Implementation of a scalable target
operating model.
⚬ Organizational restructuring and brand
repositioning.
• Leadership Development:
⚬ Appointment of change champions.
⚬ Functional training for role alignment.
• Operational Transformation:
⚬ Introduction of a hub-and-spoke model.
⚬ Centralization of back-end operations
• Technology Upgrade:
⚬ Implementation of robust contemporary
IT infrastructure.
• Performance Management:
⚬ Introduction of a formal performance
management system.
Transformative Initiative
 Marketing and Technology Employee Engagement and
Customer Value Enhancement
Initiatives Performance Management

• Town Hall Meetings

• Multichannel Marketing Strategies • Online Financial Management Facilities
• Skype-based Communication Channels
• Robust IT Infrastructure Implementation • Email Campaigns
• Workshop Conducts
• Online Platforms Enhancement • Social Media Initiatives
• Formal Performance Management Systems
• Mobile Accessibility Improvements • Strengthening Technology Platforms
• Employee Surveys
• Social Media Engagement Strategies • Streamlining Credit Approval Processes
• Reward Programs Implementation
• Customer Relationship Management • Meeting Customer Requirements in Real-
Systems Integration Time

PNBHFL's transformation positions it favorably for

future growth and expansion in the housing finance
sector through improved competitiveness and
operational efficiencies.

Why was there a need for organizational transformation at PNBHFL?
Stagnant
Growth
PNBHFL experienced
stagnant business growth with
a market share of less than
0.4%, necessitating strategic
changes to boost expansion
and competitiveness
QUESTION: 1
Operational
Inefficiancies
The company faced operational
challenges such as misaligned
reporting structures, lack of
specialized functions, and
absence of underwriting
policies, which hampered
efficiency and performance.
Negative
Workplace
Atmosphere
The organization grappled
with a negative workplace
atmosphere, characterized by
disengaged employees and a
lack of motivation, impacting
overall productivity and
morale.
Competitive
High NPAs
Pressure
Intense competition within the
PNBHFL's non-performing
housing finance sector,
assets were nearly 1.5 times the
particularly from nationalized
industry average, signaling
and private banks, compelled
underlying issues with risk
PNBHFL to enhance its
management and loan quality
capabilities, customer trust, and
that needed to be addressed for
brand image to remain
sustainable growth
competitive.
 QUESTION: 2 Driving Forces
1. Strategic Partnership: Destimoney
Enterprise’s collaboration infused
capital and expertise, compelling
Explain the transformation at PNBHFL PNBHFL to enhance
based on Lewin's Force Field Theory? competitiveness.
2. Market Competition: Intense
industry competition pushed
PNBHFL to adapt and innovate to
Lewin’s Force FIeld Theory proposes that an
individual's behavior is influenced by two opposing meet customer demands.
3. Leadership Vision: Clear leadership
forces: driving forces that push for change and
vision under Sanjaya Gupta inspired
restraining forces that resist change. According to this
alignment towards organizational
theory, change occurs when the driving forces exceed the
goals.
restraining forces, leading to a shift in the equilibrium 4. Technological Advancements:
state. It emphasizes the need to identify and address both Adoption of technology for
facilitating and hindering factors to successfully improved customer service and
implement organizational change. operational efficiency drove change.
Restraining
Forces
1.Organizational Culture:
Resistance within existing
culture hindered the
adoption of new practices
and processes.
2.Employee Resistance:
Apprehension among
employees, especially older
staff, about the impact of
change on their roles.
3.Communication Challenges:
Ineffective communication
led to ambiguity and
confusion about
transformation goals.
 QUESTION: 3
What factors contributed to resistance to change?

Legacy Mindset Lack of Trust in Uncertainty and

Job Uncertainty Poor Brand Image
Leadership Ambiguity

Long-time employees were
accustomed to the existing
culture and ways of working
within the organization which
led to discomfort and
resistance among senior
employees
Employees feared losing their
jobs due to the transformation
process. This fear of job
insecurity caused stress and
resistance among employees
who felt threatened by the
changes taking place.
Some employees may have
lacked trust in the leadership
team, particularly if they
perceived the new
management as disconnected
from the workforce or not
genuinely invested in the
employees' well-being.
The poor brand image caused Rumors and unofficial
challenges with hiring and information circulated among
retaining top talent and employees, creating an
skilled employees. They did ambiguous environment. This
not have a performance- uncertainty about the future
driven culture & their other direction of the company
policies were not employee heightened resistance to
friendly. change
 QUESTION: 4
How effectively has PNBHFL overcome resistance to change?

Change Champions Communication Channels Leadership

Identified and appointed resistant New managing director Sanjaya Gupta led
Established robust channels like town hall
employees as leaders to drive the change by observing culture, identifying roadblocks,
meetings, Skype-based platforms, and the
process positively, leveraging their and strategizing change, while actively
MD's Post for open dialogue, feedback, and
perspectives and involvement in the engaging, communicating vision, and
trust-building among employees.
transformation journey. demonstrating commitment..

Employee Engagement Training and Development Cultural Integration

Aligned employee aspirations with Invested in employee upskilling through
organizational goals through competency functional and cross-functional training,
mapping, workshops, performance-driven leadership development programs, bridging
practices, and reward programs to motivate technical and functional gaps for effective
and foster excellence. adaptation to change.
Emphasized value-based culture through
workshops, morning prayers, and initiatives
fostering unity and shared purpose, creating
a positive work environment conducive to
embracing change.
Thank You!