We recently interacted with Mr Nanda Kumar, CEO SunTec Business Solutions to understand his perspective about the latest development in the technology sector. Here are few excerpts of the interview:-
You embarked on this tech-enabled end-to-end value management almost three decades back and much has happened in the outside world. Staying put on the growth path during these disruptive times is a case-study. We would like our audience to know your story on this continued passion for delivering value.
Value management is in fact rooted in our organisational DNA. It is also captured in our vision statement, which is to enable every value exchange in the digitally driven world. While the outside world has seen many disruptions over the last thirty years, fundamentally, businesses are able to survive and thrive only if they are consistently delivering value to their customers. This applies as much to SunTec as it does to our clients.
30 years ago, we were fortunate to start our journey alongside the dawn of the Internet age with telecom clients. Early on, we realised that if we were to succeed in a rapidly changing world, we needed to shift from a product-centric approach or strategy to a customer-centric one. Also, fundamentally, this evolution had to happen from a disjointed system to one where pricing had to be based on reliability of delivery and transparency.
When we applied this shift while working with our telecom clients, we were able to generate more value for their customers with every single additional phone call they made, by analyzing their monthly bills using our technology space.
Once we saw the customer-centric approach work for our telecom clients, the logical next step was to apply this approach to other industries and help them create more value for their end-customers. We ventured into banking and financial services in 2000 with a whole new approach to pricing by making it customer-centric. Our idea was to help our clients maximise value for themselves and their customers by offering attractively priced and hyper-personalised products and solutions on one end, and plugging any potential revenue leakage on the other.
Customer centricity has therefore been the guiding light for most of our journey and even today, we are singularly focused on helping our clients create more value for their customers as well as for themselves by becoming more customer-centric than ever. We firmly believe that a customer-centric business is much better suited to sail through disruptions and continue to deliver meaningful value to its customers.
You have shaped the wave of customer-centric software platforms and solutions for pricing and billing, particularly in transaction-intensive verticals. Having pioneered the concept of relationship-based pricing, please share your thoughts and outlook on this critical aspect, which is key to balanced pricing dynamics.
Pricing and billing together determine just how successful a business will be in creating value for itself and for its customers. Pricing is also the final determinant of value exchange. If the price is set too high as compared to the perceived value of a product, there will be fewer or no customers. On the other hand, if the price is set low, the business will have lower profits. Another important factor is the context of the consumption. For instance, the value of a bottle of water will increase exponentially for a person in a desert as compared to those who have an abundance of water around them. So human emotions also play a role.
Getting the billing systems right is in fact critical, because even a tiny discrepancy at the backend can lead to revenue leakage and drain the profitability. For example, if a bank with 10 million customers is losing on average just ₹0.25 of say half of its customers per month, it is still losing ₹1.25 million per month or ₹ 15 million every year, which is a drain on its profitability.
Plugging this leakage often necessitates taking advantage of modern technology to craft and offer the right product at the right price to the customer. Also, banks are increasingly realising that in today’s hypercompetitive environment, when technology is a great equaliser, they need to start adding external partners to their systems in order to offer more value to the customer. We’re seeing this transition with some of our banking customers, who have built an ecosystem play with a variety of external businesses as partners.
Now, as soon as banks start building an ecosystem play, pricing and billing becomes even more important. For example, if your bank is offering you a concierge service or a travel service as a value addition, they have to not only price it correctly, but also do so after factoring in your own behavior. How many times do you travel every month or every year? Are you a preferred customer of your bank? What is your credit rating? Such behavioral factors are today playing a greater role than ever in helping banks create and deliver more value for their customers without sacrificing their profitability.
How do your products and solutions enable organizations to adopt a customer first strategy and exponentially increase revenue and customer base?
Our solutions are designed for complete customer experience orchestration. From a customer point of view, they want to know why they should be charged, whether they are being charged transparently, how they can save money, how they can get customized offers and so on.
We have a solution designed for deals and offers management and yet another solution designed for product rationalization, which helps prevent the customer churn and minimizes the cost of servicing legacy products that are perhaps offering lower value to the customers.
In essence, our products and solutions help banks design and manage a customer-centric product portfolio, price their products attractively in order to maximise value for everyone, and finally optimise their partner ecosystem and their billing process. They allow banks to go beyond their market offerings and tap into the industry’s broader ecosystem to serve, satisfy, and grow their customer base.
With COVID 19 the Digital Transformation journey of most of the banks seems to have gathered momentum, what are the customer-facing trends that may emerge over the next 6-8 quarters?
Banks are today busy reinventing their business and revenue models on account of the widespread disruption caused by the pandemic. One of the most striking trends that we’re seeing is greater collaboration, even among competing players inside the banking ecosystem, as banks look to shore up competitive differentiation and attract the newer, digital-proficient generation. For example, Google will soon start offering “Plex”, mobile-first digital bank accounts through its Google Pay app to its US customers. For Plex, Google has partnered with 11 banks and credit unions, including Citi.
Banks are therefore not just partnering with fintechs but with Big Tech companies too. In turn, customers will soon see the entry of non-traditional players in banking, like Google, Facebook and Amazon. Big Tech is today able to offer precisely what a bank used to offer in the past because they already have a large database of users and all of their users need financial products and services.
Platformification of banking is another important trend from a customer perspective, which would offer them access to more credit and flexible payment options with ecommerce players, or help protect their financial wellness in adverse economic conditions.
Finally, as banks look to reduce costs, automate, and simplify their business in order to gain more efficiencies, the role of bank branches will likely change post pandemic. One possibility is their transformation into ‘experience centers’, where a bank’s customers can get to know and understand various products and services better.
As a trendsetter, what are your Top 3 emerging trends in the Fintech space, which shall further revolutionize the banking and financial services industry
The fintech space is uniquely positioned to complement larger banks by serving the digitally native Generation Z, which is also the youngest working population today. Younger people naturally gravitate towards fintech players on account of convenient and hassle-free banking experience that traditional banks are still not able to offer.
Particularly in India, digital and mobile-first neo-banks will continue to gain more ground in 2021 as they are both cost-effective and faster than conventional banks, on account of better technology capabilities and more agile structures.
With banks keenly looking for new partners, the fintech companies with mature products and technologies will make for natural targets – both for collaborations and technology licensing deals and, in some cases, even acquisitions.
You are a firm believer that organizations need to master the art of building the competency for every employee. How do you start the process of having a self-motivated individual who is inclined towards continuous learning?
We are indeed fortunate to have many of our industry’s brightest individuals as part of SunTec. Thanks to our people, we’ve built an organization that prides itself as a leader in the relationship-based pricing and billing space globally.
It’s little wonder then when we had to go into a sudden lockdown on account of the pandemic in March 2020, our people all over the world ably rose up to take the challenge of meeting all our customer and employee commitments. We didn’t lose a day, not even an hour, in adapting to the new circumstances, which was indeed unprecedented.
From our side, we have worked hard to create a learning culture at SunTec that directly links the process of competency building with professional and career goals and aspirations of our employees. We have also taken care to provide full organizational support in the form of systems, tools and processes that support their learning goals. Finally, we also ensure that people always have a chance to apply their newly acquired skills and competencies in real life.
Known for building a strong team, a people’s man yourself, what would be your advice to the new generation of entrepreneurs who are actively participating in this disruption journey?
As an entrepreneur, your first job is to only hire people who complement your skills and competencies. Far too many first-generation entrepreneurs make the mistake of believing that only they have to solve all of their business problems. On the contrary, hiring someone who is better equipped to handle a specific function – sales, marketing, engineering or finance – and then letting that new hire solve their function’s problems is the first step towards building a great team.
Also, all young businesses undergo a major transition checkpoint when the team size crosses a certain threshold, and the founding team is no longer able to remember the names of all employees. Once the organization crosses this checkpoint, entrepreneurs must pay closer attention to effective propagation of their original organizational culture and value system among the new employees. This will ensure that the entire organization is pulling together in the same direction.