Permata Bank's Ridha Wirakusumah on Leading People

Read the transcript below.

RIDHA WIRAKUSUMAH: As I look into this bank, I realize this bank that I'm going in, which is Bank Permata—45% owned by Standard Chartered Bank, 45% by Jardine—used to be the sixth largest bank in the nation. Now, it's, what, you know, 10, 11th in terms of size. In 2016, they posted over half a billion dollar loss, which is the largest losses in the history of Indonesian banking.

The interesting part about it is, as you dig deeper those losses [were] caused by people. The losses that actually really resulted from a wrong decision on credit lending was not caused by system or wrong credit criteria or some data analytics going haywire. It is actually a decision done by people. Yes, I have, you know, extremely strong background as an electrical engineer, you know, in math, and quantitatively, I'm a lot more comfortable.

But as I look through, you don't get the people equations correct, you can forget about any numbers you can think about. And that's the reason why I actually take a lot of pain and a lot of focus on getting the people equations correctly.

Now, Bank Permata used to be and still is an extremely strong bank when it comes to IT platform. It is one of the only banks in Indonesia that actually tied to an unbelievable ecosystem, which is Astra International, one of the most respected business groups in Indonesia. What I did was, you know, I learned what the strengths of these banks are. I learned what the cause of the problems were. And then I started from there.

When I first came to the bank—we have an auto finance volume in a month, which was about, you know, 200 billion rupiah, which was primarily sourced from our partner Astra International. That volume that they are doing in the Astra International—because they have over 60% of market share in motorcycle and about 40-odd percent in auto—they are dealing with huge volumes. Yet, we only take a small portion of it. A lot of volumes actually go to other banks.

We then begin to quickly and systematically map out where are our shortcomings. And we fix each one of them, you know, step-by-step, one-by-one from processes, from product features, from pricing, from the partnership agreement, from IT deliverables, from cross-sell opportunities. Last October, we are at 1.2 trillion a month. And that's a far cry from 200-over billion, you know, by a factor of six times, which is encouraging.

The thing that I'm encouraging from a people angle in this whole process was, yes, I actually put a spotlight on the problems. But through the journey of fixes, in the beginning I ask a lot of questions; towards, you know, later part, my questions become less and less. And that's when I begin realizing that my role is diminishing, to my enjoyment, because they can ask the questions themselves without me asking the questions. And the result speaks by itself.

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