6/18/2012

HIGH SPEED, LOW COST, STRATEGIC ORGANIZATION TRANSFORMATION @ BANK MANDIRI

1

6/18/2012

TABLE OF CONTENT • • • • •

BANK MANDIRI PROFILE BANK MANDIRI HISTORY SUCCESS FACTORS SOLUTION SUMMARY E-MANDIRI EASY VIDEO

BANK MANDIRI PROFILE

2

6/18/2012

BANK MANDIRI PROFILE 28.183 employees 1537 branches in Indonesia 8996 ATM

92.874 EDC

5 Overseas Offices Hong Kong

Timor Leste

Shanghai

Singapore

Cayman Island

8 Subsidiaries

BANK MANDIRI REMAINS ON TRACK TO BECOME INDONESIA'S MOST ADMIRED FINANCIAL INSTITUTION

3

6/18/2012

KEY FINANCIAL HIGHLIGHTS

SHARE INFORMATION

4

6/18/2012

AWARDS FOR BANK MANDIRI 2007 The Best Public company in Banking Category

Bank Of The Year 2007 Indonesia

• Best Overall for Corporate Governance in Indonesia • Best for Disclosure and Transparency

2008 The Most Trusted Company Bank Of The Year 2008 Indonesia Corporate Governance Perception Index

Overall Best Managed Company in Indonesia – Large Cap

The Best Bank In Indonesia 2008

• Best Trade Finance Bank • Best Cash & Liquidity Management Bank • Best Financial Supply Chain Bank in Indonesia

2009 The Most Trusted Company Bank Of The Year 2009 Corporate Governance Indonesia Perception Index

Asia’s Best Companies for Corporate Governance

• The Best Local Private Bank in Indonesia • The Best Bank In Indonesia 2009

The Most Trusted Company Most Admired Company in Banking 2010 Corporate Governance Perception Index

Asia’s Best Companies for Corporate Governance

The Strongest Bank Award 2010 in Indonesia

Best Bank in Indonesia

2010

2011 9

The Most Trusted Company Corporate Governance Perception Index

Best Domestic Bank, Best Domestic Debt House, Best Private Bank, Best Domestic Interest Rates,

Asia’s Best Companies for Corporate Governance

Best Private Bank in Indonesia, Best Bank in Indonesia

Best overall managed company in Asia – Banking and Financial

Best Bank in Indonesia

Best Bank in Indonesia

BANK MANDIRI HISTORY

5

6/18/2012

BANK MANDIRI HISTORY 1997

1998-1999 • 2 Oktober 1998

Asia Economy Crisis

Bank Mandiri established • 13 Maret 1999

• Devaluation of Thai Bath • Central Bank liquidates 16 Banks

Central Bank liquidates 38 Banks

2000-2004

2005 Secondary Crisis BMRI

• 14 Juli 2003 BMRI IPO for 20% stake • Increased growth in performance not supported by strong fundamentals.

• 31 Juli 1999 4 state owned Banks (BBD, BDN, Bapindo & Exim) merges into Bank Mandiri

5.3 4.6

Employees demotivated NPL Gross PAT 26.7% Rp. 603 Bn

3.6 2.7 1.2

• Head count reduction from 26.600 to17.620 • Branch reduction from 740 to 546 • Consolidations 9 systems into 1 • Transferred Rp. 103 triliun bad loans to IBRA

16 Mei 2005 Stakeholders appointes new BOD

2000

2001

2002

2003

PAT BMRI in Tn Rp

2004

Share Price Nov 2005 Rp. 1,076

THE 2 OPTIONS AVAILABLE TO THE BOD LARGE LOCAL BANK

REGIONAL CHAMPION BANK

Bank Mandiri chosed to take the difficult road to become a Regional Champion Bank using the Dominant Multispecialist Bank Strategy

6

6/18/2012

TO ACHIEVE THE VISION THE BANK TRANSFORMED FOUR AREAS • Performance based organisation

• Redefining performance mgmt system

• Focus on managing bad loans

• Implementation of higher ethical standard

• Strengthen risk management system at 3 levels: underwriting, monitoring and restructuring & collection

• Implementation of new corporate culture • Leadership and Talent Development 1

2

4

3

Culture Strategic Alliances

Control NPL Business Growth

• DA clear strategy and value preposition for each business segment • Develop and manage alliances across SBU

• An optimum distribution network • Sales and Service culture • Non – organic growth to acquisition

… IN 3 PHASES Shaping the End Game Outperform the Market

Improve and Grow

Consolidate

Back on Track Build the fondation

2005 • Net NPL < 5% Key • Increase Provision for Indicators Loan Coverage

2008 • Business and profitability growth above market • Competitive ROE • Optimum PBV

2010 • Dominate market share in all segmen • Market Cap above USD 10 Bn

7

6/18/2012

Market Capitalization (Bio USD)

FIRST PHASE OF TRANSFORMATION ACHIEVED THE DESIRED OUTCOME

1.14 Asset Size (Bio USD)

184

132

138

88

70

30

65

42

33

39

53

41

10

46

24

23

6

Data as of 25 /05/2010, Source: Infinancial; Dow Jones; Bloomberg

SUCCESS FACTORS SOLUTION

8

6/18/2012

BUSINESS CASE • • • •

To achieve its 2014 vision and maintain its leadership position Bank Mandiri needs to get the highest levels of productivity from all its employees. Highest productivity requires highest levels of engagement. How do we build the highest levels of engagement? According to Gallup engagement is built through: How satisfied are you with Mandiri as a place to work?

Growth

Teamwork Individual Contribution Basic Needs

• Opportunities to learn and grow in past year • Progress discussion in last six months • • • • • • • •

I have a best friend at work Co-workers committed to quality Mission/purpose of company At work, my opinions seem to count Someone at work encourages my development Supervisor/someone at work cares about me as person Recognition last seven days for good work Do what I do best every day

• I have the materials and equipment I need to do my work right • I know what is expected of me at work

BUSINESS CASE •

For any company operating in a growth market, it is easy to add up resources to grow, however it is unsustainable in long term.

•

Mandiri’s transformation has to be sustainable, a “multiplication” strategy or “DOING MORE WITH THE SAME OR LESS”.

•

In the past Mandiri did grapple with strategic transformation using ERP but with disappointing results in terms of costs, time, and the desired behavioral change.

•

So the new SOLUTION has to be different and completed quickly and efficiently as the competition within the banking sector is heating up significantly.

•

Hence, the STRATEGIC TRANSFORMATION needed is “DRIVE PRODUCTIVITY BY ENGAGING EVERY MANDIRIAN, QUICKLY, EFFICIENTLY, EFFECTIVELY & SUSTAINABLY”.

9

6/18/2012

BUSINESS CASE •

Organisational apathy resulting from previous transformation exercises had to be overcome with ease of use and massive organisational empowerment.

•

Mandiri has to spend 5% of payroll cost in for HC Development & Training, but limited operating and capital expense budget. How SF can help optimize Development & Training Budget utilisation?

•

SF uses a cloud model, which means we do not need large investments in IT or IT personnel.

•

In the past Mandiri Line Managers only functioned as a Business Manager but never acted as People Manager.

•

In the past Performance Management System is only a rewarding tool. SF will empower Mandiri Line Managers to act as People Manager.

SUCCESS FACTORS VS. ERP Success Factors

Large Scale ERP

Cost Multiplier

1 x (over 5 years)

3.5 x (over 5 years)

Budget Source

Development & Training

Capital & Operational Expense

FTE Needed

3

~ 15

Implementation 9 months for all HC modules Timeline

Minimum 2 years for administrative HC processes

Scope

All Employees

HR Teams

Infrastructure

Not Required

Significant needs

Rollout frequency

Multiple within short periods

Multiple within long periods

Training

• Number of Trainers: 4 • 1 month TTT for ~ 800 employees • 1.5 months EUT for 25.000 employees

• Number of Trainers: 20 • 1 month TTT for ~ 20 • 2 months EUT for ~ 200 HR Team

User Friendly

Yes

No

10

6/18/2012

INTRODUCTION TO E-MANDIRI EASY • •

e-Mandiri EASy is electronic Mandiri Employee Appreciation System. Empowered by Success Factors, the online system integrates HC processes via internet. BEFORE e-Mandiri EASy

AFTER e-Mandiri EASy

• Decentralised HC processes

• Centralised and integrated HC processes

• Managing execution is not easy and manageable.

• Accessible via internet 24x7, hence easy to manage

• Limitation on Time and venue

• Flexible. All processes can be accessed anywhere and every time.

• Problem managing hardcopy

• All files are in softcopy/e-file

SF NOVELTY •

Integrates seamlessly with our HC Strategy and supports all HC functions excluding payroll. GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

EMPLOYEE PROFILE

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

Mandiri HR Strategy

COMPENSATION MANAGEMENT

SUCCESSION MANAGEMENT

e-MANDIRI EASy (Success Factors)

11

6/18/2012

SF NOVELTY 1. Organisation Development is mapped to CAREER & DEVELOPMENT PLAN GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

EMPLOYEE PROFILE

COMPENSATION MANAGEMENT

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

SUCCESSION MANAGEMENT

Mandiri HR Strategy

e-MANDIRI EASy (Success Factors)

SF NOVELTY 2. Workforce Fulfillment is mapped to EMPLOYEE PROFILE GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

EMPLOYEE PROFILE

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

Mandiri HR Strategy

COMPENSATION MANAGEMENT

SUCCESSION MANAGEMENT

e-MANDIRI EASy (Success Factors)

12

6/18/2012

SF NOVELTY 3.Learning & Development is mapped to 360 DEGREE REVIEW and CAREER & DEVELOPMENT PLAN GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

COMPENSATION MANAGEMENT

EMPLOYEE PROFILE

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

SUCCESSION MANAGEMENT

Mandiri HR Strategy

e-MANDIRI EASy (Success Factors)

SF NOVELTY 4. Employee Relations is mapped to EMPLOYEE PROFILE GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

EMPLOYEE PROFILE

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

Mandiri HR Strategy

COMPENSATION MANAGEMENT

SUCCESSION MANAGEMENT

e-MANDIRI EASy (Success Factors)

13

6/18/2012

SF NOVELTY 5. Performance Management & Rewards is mapped to GOAL MANAGEMENT, PERFORMANCE MANAGEMENT and COMPENSATION MANAGEMENT GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

EMPLOYEE PROFILE

COMPENSATION MANAGEMENT

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

SUCCESSION MANAGEMENT

Mandiri HR Strategy

e-MANDIRI EASy (Success Factors)

SF NOVELTY 6. TALENT & SUCCESSION MANAGEMENT is mapped to SUCCESSION MANAGEMENT GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

EMPLOYEE PROFILE

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

Mandiri HR Strategy

COMPENSATION MANAGEMENT

SUCCESSION MANAGEMENT

e-MANDIRI EASy (Success Factors)

14

6/18/2012

SF NOVELTY CULTURE & LEADERSHIP is mapped to JAM (EKMS) and 360 DEGREE REVIEW GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

COMPENSATION MANAGEMENT

EMPLOYEE PROFILE

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

SUCCESSION MANAGEMENT

Mandiri HR Strategy

e-MANDIRI EASy (Success Factors)

SF NOVELTY Strategy & Tactical HC Practices is mapped to Mandiri EASy Policies, training materials and infrastructure GOAL MANAGEMENT

JAM (EKMS)

PERFORMANCE MANAGEMENT

In progress

LEARNING (ELMS) In progress

EMPLOYEE PROFILE

CAREER & DEVELOPMENT PLAN

360 DEGREE REVIEW

Mandiri HR Strategy

COMPENSATION MANAGEMENT

SUCCESSION MANAGEMENT

e-MANDIRI EASy (Success Factors)

15

6/18/2012

SF IMPLEMENTATION TIMELINE Jan 11

Mar 11

7 modules, 9 months, 3 Mandiri FTE

Phase 1 • Compensation Mgmt • EUT Compensation Management • Total Mandiri FTEs: 2

Apr 11

Jun 11

Phase 2 • Goal Management • TTT Goal Management • Total Mandiri FTEs: 2

GO LIVE Sep 11

Jul 11

Phase 3 • Performance Management • Development Plan • Talent Classifications • Succession Planning • 360 Degree • Total Mandiri FTEs: 4

Oct 11

Dec 11

Training • TTT for all modules • EUT for all modules • Total TTT FTEs: 4

SUMMARY • Our business case has been achieved through Success Factors • Fast Implementation Time • Cost Effective • Efficient o HC Team can manage system severally o Increase HC efficiency by accelerating all HC processes o Reduce HC FTE to manage HC processes • Engage every individual in Mandiri • Significantly increase employee participation in personal development • Develop coaching culture • Enable line managers to value and retain top performing talent • Empower line managers to make people decisions

        

16

6/18/2012

THANK YOU TEAMS!

Belinda Wlossak (SF)

Ben Corser (SF)

Dean Blundell (SF)

Doug Mecimore (Aasonn)

Raymond Kuo (SF)

Sandeep Gudur (SF)

Susan Fisher (SF)

Valerie Mahan (Aasonn)

Vicky Zani (Aasonn)

Andi Wibisono (DDI)

E-MANDIRI EASY VIDEO

17