How IDFC First Bank can teach Galgotias a timeless lesson

In the recent past, two homegrown brands were confronted by unfavourable circumstances. The university was exposed at the marquee AI summit on charges of plagiarism. The bank is suffering a loss in reputation due to some rogue employees. However, the similarities end right there. 

Galgotias University chose the easy way out, the 'scapegoat' route to redemption. The employee, Neha Singh, was positioned as the villain designate, thus seeming to absolve the policymakers of any wrongdoing. Naturally, the reputation of the institute took a deserving beating, as the fallacy in the argument was brutally exposed. Surely, a Professor, acting as the spokesperson, was acting at the behest of the higher forces. 

IDFC First Bank, however, chose to confront the matter in Abhishek Sharma's mode, recognising the challenges and addressing them wholeheartedly. The 590 crore sum in question was instantly repatriated to the Haryana Government coffers, in full satisfaction. A clear public communication was made to not just regulators but customers as well, taking total ownership of the lapse. No attempt to blame any insignificant others or pass the buck to any colossal conspiracy.

Modern-day corporate crisis issues can be broadly classified under a few obvious headers. Each category has a prominent use case or two, setting the tone for future action points.

Firstly, the 'catastrophic accident' led to loss of lives, whether customer or community. The Air India AI 171 crash in Ahmedabad tested the mettle of the Tatas, whose time-tested integrity stood out in flying colours. All compensations were duly made, even surpassed, while the convenient temptation to blame the pilot was duly resisted. The Wow Momo fire in the Kolkata godown was perhaps handled less thoughtfully, with the commitment to compensation overshadowing the admission of procedural lapses in safety measures. 

Second is the 'backfiring company policy' leading to disenchantment and loss of business. When OpenAI started accepting advertisements in ChatGPT, there was a mammoth backlash, with neutrality being severely questioned. Sam Altman was quick to apologise, perhaps clearly calculated but definitely human in projection, with no attempt to either justify or blame others. A similar pattern often occurs during product recalls in the technology and automotive domains, wherein candor is the finest policy.

Thirdly, and increasingly common, is the 'Rogue Employee' calamity, as genuinely in the case of IDFC First Bank and dubiously in the matter of Galgotias University. As businesses expand rapidly and recruitment protocols need to get accelerated, a section of the workforce may well get compromised. In terms of ethics as well as deliveries, often a combination of both. This is where the resilience and integrity of the corporation gets tested minutely, evoking the involvement of corporate pedigree and old-fashioned managerial courage. 

Galgotias could well have owned up as an institution, citing their centres of excellence as an actionable alibi. This would have enhanced their credibility in a human and technical context, in an era of miniature public memory. The Robodog being rapidly forgiven as an act of gleeful excess, as opposed to deliberate deceit. On a larger national agenda of beating the Chinese at their own game, the duplication of replication. This would have actually earned them extra 'jalebi' points. 

IDFC First Bank, on the other hand, chose a mature and thoughtful route map to address a large challenge. This combined global best practices in crisis management with a thoughtful appreciation of Indian emotions. Where honesty, delivered without drama or excess, remains the best strategy for a progressive way forward. Quite obviously, the highly professional management cadre, interested in building a world class business, acted appropriately. 

As AI becomes a standard operating ally for businesses, the instances of tech-enabled fraud may well increase. As fast-forward economic ambitions of the emerging demographics evolve further, the temptations for perilous shortcuts will surely accelerate. In this multifaceted war zone, the intrinsic mettle of corporations will be sorely tested each time a crisis appears. 

All will be well advised to apply the IDFC First Bank model on a foundation of scalable integrity. Where responsibility to the community at large is demonstrated in ample abundance, much beyond the call of business. First, last, and always, this must be the abiding mantra.