Taking business to the people
 People’s Bank has been chosen as the most favourite banking brand for
the year 2011 by SLIM -AS Neilson most favourite brand competition. This
is an independent selection based on the perceptions and attitudes of
the people based on real life experience and it has nothing to do with
either the internal data released by different banks or on the rating
from Fitch Lanka every year.
What is more interesting is that it was the public sector banks that
have notched up impressively results in this survey with the National
Savings Bank and Bank of Ceylon also registering their presence
meaningfully well above other more ‘posh’ banks that are considered more
commerce and business oriented.
This was also the topic of an article recently written to the
business pages of this newspaper by Management Consultant Rohantha
Athukorala titled ‘Public sector beats the private sector?’
Commercial perspective
Rohantha was analyzing these results more from the commercial
perspective where he states that the public sector could still beat the
private sector despite such strong competitive scenario and the
advertising muscle entrenched in the private sector. This could be true
from his management point of view but in my view the real reason for
this situation is the socio-economic forces that public sector is
naturally exposed to in the day-to-day business in the Sri Lankan
society as against the limited sector that private sector generally and
traditionally indulges in. To prove this point you could visit these
public banks during business hours and see that they are generally more
crowded than the private sector banks. And it could also be observed
that the public banks are comparatively less prompt in their service
when placed against their private sector counterparts where the
atmosphere and the service appear more prompt and business like. But yet
that makes the public banks click ahead of the private banks?
On the other hand if you take the insurance industry you could also
witness that despite a 30-year competition muscled by a tremendous
advertising and commercialized jink by the private sector Sri Lanka
Insurance Ltd. still remains the leader in insurance business.
Thus there is something that certainly clicks in the public sector
that is wanting in the private sector and it would be beneficial from
the national point of view to analyze this specialty associated with
business of the public sector as against the endeavours of the more
business focused private sector.
Public sector
As mentioned, the secret of this success of the public sector lay in
the socio-economic factors of the Sri Lankan populace. Incidentally
these two institutions The People’s Bank and The Sri Lanka Insurance
Corporation were initially set up in the 1960 during the national
rejuvenation initiated by the SLFP government of Sirimavo Bandaranaike
and the credit for instituting those should go to her Finance Minister T
B Ilangaratne, essentially a man of the soil.
These two institutions were designed to address the commercial needs
of the greater Sri Lankan masses who were up to then deprived of banking
and insurance services.
Quite appropriately these two institutions started their work in
earnest in Sinhala and Tamil, languages familiar to the masses of the
emerging nation. Thus these institutions, being more friendly and
communicable to the masses formed the vanguard of banking and insurance
business in Sri Lanka making the private sector weary of their success
even today.
Ironically, it should be mentioned that at the time of the formation
of these institutions, the private sector business magnates entrenched
in their ‘agency house’ business mentality and propped up by the
snobbish post colonial environment ‘pooh - poohed’ the idea of
commencing business ventures in the native languages and predicted that
they would not last the length of their initiatives.
Those predictions eventually got caught in the dynamism of greater
people participation in the public sector and even after 30 years of
economic liberalization these two institutions stand as the leaders in
their respective fields.
Public corporations
Similarly there were a host of other public corporations created by
the SLFP led governments from time to time to address the commercial
needs of the public like the Tyre Corporation, the Steel Corporation,
Flour Milling Corporation etc. Even though some of these ventures may
have faltered and failed, the majority stood the test of time till they
were ‘privatized’ in a questionable orgy where the state sold its
‘family silver’ for a pittance. The point is, just as the People’s Bank
and Sri Lanka insurance these public sector organizations should not be
viewed for their worth in Rupees and cents but for the greater service
they render in the socio-economic sphere of employment generation,
reasonable and reliable service to the public. Even today the average
farmer prefers the fertilizer of the Fertilizer Corporation to that of
the private sector despite their customer- orientation.
Therefore the public sector has a few advantages that the private
sector, with all their scientific business management theories have not
been able to overcome and the main advantage is that in the post
colonial Ceylon the public sector has been more people-oriented in their
outlook.
To start with when you call a private sector institution the
telephone operator or the answering mechanism often responds only in
English and this I find quite incongruous in a country where only 10
percent of the people are conversant in English. The insurance industry
where I am involved, often complains of their inability to penetrate the
life insurance market but they have all their policies only in English.
Therefore in my view the reason why the public sector is ahead in
business is that the public sector has been very much a part of
progressive nation building in the post colonial era whereas the private
sector still finds in increasingly difficult to think ‘out of the box’
from their colonial legacy.
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