Cedar Podcasts

New-age technology and the rise of fintechs have fundamentally shifted power into the hands of your customers. The traditional model of exclusive, high-touch relationship management is being replaced by a demand-driven era defined by self-directed investing and transparent, transaction-based fees. To stay competitive, you must pivot from serving only ultra-high-net-worth individuals to capturing the convenience-driven mass-affluent and millennial segments who prioritize speed and simplicity.

Your success now depends on striking a "hybrid" balance: offering automated, low-cost robo-advisory platforms for routine transactions while maintaining access to human experts for complex scenarios. By leveraging AI and Big Data, you can provide flawless execution, personalized research, and proactive cross-selling. The holy grail is a fully digitized value chain that empowers customers with digital onboarding, real-time portfolio health checks, and peer-to-peer investment options. If you fail to embrace this shift toward transparency and self-service, you risk losing relevance in an industry where loyalty is no longer earned through relationships alone, but through superior digital engagement and lower transaction costs.

Sanjiv Anand, Chairman, Cedar Management Consulting International

This year is your critical breakout moment to embrace AI and full digital transformation. With global net income rising, you must transition to AI-driven customer acquisition, credit, and instant delivery to remain competitive. You should clearly define your target audience and tap into the "gold mine" of underserved SME banking through improved credit assessment models.

To succeed, you must simplify product offerings and balance digital efficiency with strong relationship management to avoid becoming a generic commodity. You should strive for a "100% digital" goal aiming for account openings in under four minutes supported by AI-powered cross-sell engines that can reduce acquisition costs by 50%. Finally, building a performance-oriented culture with clear accountability is essential, as even a digital bank requires a motivated, tech-savvy workforce to execute a successful strategy.

In this episode, Chetan Parekh from Cedar Consulting emphasizes that transaction banking has become a top priority for corporate banks. As low interest rates shift revenue from interest to fee income, banks are targeting a $1 trillion global opportunity. To improve profitability, banks must lower their cost-to-income ratios by choosing to be market disruptors rather than being disrupted. Parikh suggests two paths for innovation: building agile platforms release-by-release with fintechs, or partnering with large tech companies to prioritize existing platforms.

Key innovation priorities include replacing traditional systems with B2B APIs and developing dedicated SME platforms. These platforms should feature straight-through onboarding via digital signatures and API integration with official registries. Furthermore, creating an "SME ecosystem" allows for diverse use cases like working capital finance and invoice discounting. Ultimately, Parikh advises banks to adopt an agile approach with fintech partners to deliver unique user experiences and dashboards, which will effectively boost revenues while significantly reducing operational costs.  

A successful loyalty program can significantly boost customer lifetime value and long-term profitability, but without meticulous planning, it risks becoming a "white elephant" that drains margins. The foundation of a viable program rests on four pillars: financial clarity, strategic targeting, robust processes, and organizational infrastructure. Retailers must define clear financial goals—including break-even points and redemption costs—rather than treating loyalty as a purely marketing expense.

Equally important is identifying the right audience and sustaining their interest. Programs often fail due to competitive offers, unattainable goals, or a "redeem and out" mindset; therefore, value must be tangible and consistent. Operationally, success requires seamless back-end processes and a dedicated internal team spanning marketing, finance, and IT. Systems must handle real-time data flow for point-of-sale recognition and partner reconciliations. Ultimately, while loyalty programs foster higher retention and price insensitivity, these rewards are only reaped if the program is structured to reward the right customers through a well-executed, automated, and financially sound framework.

Sanjiv Anand, Chairman, Cedar Management Consulting International

In a world obsessed with rapid digital transformation, many banks have lost sight of their core purpose. While innovation is essential, the "scorching pace" of change—such as updating apps multiple times a month—risks overwhelming users who can only absorb so much at once. The author argues that juggling hundreds of tech projects simultaneously makes meaningful success unlikely and distracts from a bank's primary role as a secure financial steward.

Furthermore, banks are increasingly acting like fintech startups, taking on high-risk product development without rigorously measuring return on investment (ROI). In the rush to be innovative, basic financial metrics like revenue increase and cost reduction are often ignored. As leadership plans future budgets, the article urges an honest "stock-take" of recent investments. Leaders should evaluate which initiatives customers actually value, shut down failing projects, and apply common sense to their digital strategies to ensure they are racing toward a meaningful goal rather than just moving fast.

Indirect procurement covers non-resale goods and services such as IT, facilities, and professional services and remains a largely under-exploited source of value. Its share of spending varies by sector, but typically represents a 2–4% revenue opportunity that can be redirected to growth. Value leakage persists due to four challenges: lack of leadership focus, limited strategic procurement skills, low digitization, and weak cross-functional collaboration. As a result, procurement operates tactically, with fragmented spend, higher risk, manual processes, and increased costs, negatively impacting profitability and cash flow.

To unlock value, organizations must elevate indirect procurement as a strategic function aligned with enterprise goals. This requires a strong CPO mandate, advanced procurement capabilities such as spend transparency, strategic sourcing, compliance and risk management, supplier performance governance, and zero-based budgeting. End-to-end digitization using flexible, AI-enabled platforms can automate processes, improve insights, and enhance user experience. Finally, closer collaboration with internal stakeholders and external partners ensures sustained value creation, risk mitigation, and procurement-enabled business performance.

The article explores how organizations can effectively manage change by first understanding its nature and impact. Change typically occurs at three levels: unit-level, business-unit-level, and enterprise-level. Unit-level changes are short-term, focused, and quicker to implement, such as sales or customer-focus initiatives. Business-unit changes span functions like operations or finance, take longer, and require more effort to address specific pain points. Enterprise-level changes, such as ERP implementations, are infrequent but high-impact, affecting the entire organization and demanding significant investment and management attention.

As change scope increases, complexity and resistance also grow, making enterprise-level changes especially risky if poorly executed. Based on extensive consulting experience, four key principles help maximize change success: clearly communicating benefits to reduce resistance; increasing participation to drive ownership, especially among skeptics; celebrating successes to build momentum and institutionalize improvements; and driving change from the top, as leadership commitment is critical for adoption.

Ultimately, successful change depends on clearly comprehending both its purpose and its impact across the organization.

A digital core banking system is essential for banks to innovate faster and respond to evolving customer expectations for personalized, efficient, and digital-first services. While many banks have launched modern apps and websites, true digital transformation cannot be achieved at the channel level alone. It requires digitization across the entire bank, anchored by a modern digital core.

A future-ready core banking platform should follow key principles: a “hollow core” that functions primarily as a system of record with minimal customization; a componentized, modular architecture that allows selective deployment and upgrades; microservices that are independently deployable, cloud-native APIs enabling agility with minimal disruption; cloud readiness to improve scalability, security, availability, and cost efficiency; and open banking APIs to connect banks with fintech ecosystems.

Together, these principles reduce reliance on legacy systems, support faster innovation, and enable banks to compete in an ecosystem where many customer interactions and transactions will increasingly occur through fintech and third-party platforms rather than traditional bank-owned channels.

Sanjiv Anand, Chairman, Cedar Management Consulting International

Companies seek performance-oriented cultures, but unlocking human capital depends on how individual performance is measured. Traditional KPIs often failed to deliver results, leading organizations to adapt the Balanced Scorecard originally designed for enterprise performance for individual performance management. When applied correctly, it can motivate employees; when done poorly, it can demoralize and drive attrition.

Effective use follows a few key principles. Performance measures should be limited to five or six, as individuals cannot meaningfully focus on more. Each measure should carry sufficient weight ideally at least 15% to ensure it is taken seriously. Measures must largely be within the individual’s direct control; holding junior employees accountable for outcomes like company profitability is ineffective. As seniority increases, performance becomes more strategic, so financial measures should carry greater weight at higher levels. Finally, targets must be balanced: a mix of challenging, realistic, and achievable goals prevents demotivation.

Applying these principles increases the likelihood of building a truly performance driven organization.

Sanjiv Anand, Chairman, Cedar Management Consulting International

Board compensation and performance have come under increasing scrutiny, especially where pay appears disconnected from company outcomes. A core principle is that directors must actively participate to be paid; over-boarded directors who miss meetings undermine governance. Boards are collectively responsible for strategic oversight, risk management, shareholder value protection, setting company values, and holding executives accountable for results. The Chairman plays a critical leadership role by enabling effective board functioning, ensuring timely information, facilitating non-executive participation, evaluating board performance, and maintaining shareholder communication.

Effective boards focus on long-term strategy, succession planning, competition, industry trends, risk management, and performance monitoring. Good governance practices include clear separation of Chairman and CEO roles, limits on board memberships, appropriate board size, and strong independent director representation.

Board compensation should be competitive, aligned to expertise, and partially performance-linked, without incentivizing short-term manipulation. Best practice combines cash retainers, meeting fees, committee fees, and meaningful stock ownership through restricted shares rather than stock options. Aligning director rewards with long-term company performance ensures accountability, fairness, and sustained value creation.