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VRS forces SBI to go for rightsizing

Rajalakshmi Menon

MUMBAI, Feb. 25

STATE Bank of India (SBI) has started cutting down its departments and is also merging some of them to cope with the strain that the organisation is now facing on account of the mass exodus due to its VRS scheme.

The department ``rightsizing'' is happening at all levels including the corporate office and the zonal offices. ``This exercise has initially commenced in Mumbai and will be slowly extended to other centres. We expect to complete the process in the next couple of months,'' said senior SBI officials.

SBI has 14 local head offices (LHOs) with an estimated 150 departments. Around 30 per cent of these departments are expected to be cut down or merged with others.

``The size of most departments is expected to be reduced, some to the extent of 70 per cent,'' said another official.

The SBI Chairman, Mr Janki Ballabh, said, ``About 20-25 per cent of our available staff in the administrative offices will be redeployed in areas facing shortfalls.''

The bank is planning some promotions but will not go in for any recruitment.

SBI had received applications from 33,000 employees but has stated its intent to accept only 23,000 applications, that is 10 per cent of its staff strength.

Some nationalised banks such as Bank of Baroda, Bank of India, Allahabad Bank and Indian Bank had resorted to delayering as a measure to counter a weakened organizational set-up and to effect faster decision making.

Senior officials in SBI have said the bank will not go in for such a delayering as it had recently concluded the process of restructuring as per the McKinsey recommendations.

Top SBI officials have indicated that their first priority was to ensure that customer service was not affected on account of the VRS and to this end the bank was not averse to rationalisation of some of its branches.