TRANSFORMATIONAL LEADERSHIP

NedBank: Transformational Leadership in Sustainable Turnaround

GROUP No.

: 5 (five)

GROUP MEMBER

: 1)

Andy Revianto

2)

Jahja

3)

Shely Meifuzi

4)

Edi Suryanto

5)

Wisnu Dasuki

6)

Sammy Santoso

EMBA Batch 3
University of Pelita Harapan & Peking University

1. Based on the description of the state of the company when Boardman became CEO, what
type of leadership do you think was prevalent at that time? Cite specific examples in the
case study to support your contention.
Answer:
The type of leadership that was prevalent before Boardman became the CEO was transactional
leadership. The culture was authoritarian and the complicated matrix structure at that time
made it difficult to pinpoint accountability. The low risk taking culture had a negative impact
on innovation practices, staff was too fearful of making mistakes. These are the symptoms of
transactional leadership where the micro-management team were to ensure that preset standards
were met. The management and the staff avoided changes and worked to keep things the same.
When Boardman was appointed as CEO of Nedcor in 2003, he realized that the corporate
culture and leadership style had to be reviewed and reinvented. The new group was made up of
Nedcor, BoE, Nedcor Investment Bank, and the Cape of Good Hope Bank. He presented the
board of directors a plan of five points and persuaded the parent company, Old Mutual plc, to
inject more capital into the bank.
His 5 points plan was to:
- reconstitute the executive committee
- deliver on BoE merger
- improve customer service and provide shareholders a return on investment
- improve the company's capital position
- consolidate all brands into one brand
But this plan was "actually not a plan, but a plan to make a plan" which then needed to be
developed further into a well-thought-out turnaround plan.
2. What are specific examples of the 4 Is of transformational leadership found in this case
study (as displayed by either Brown or Boardman)?
Answer:
a) Idealized Influence:
Boardman often quoted the book titled Good to Great by Jim Collins. He did it on
purpose repeatedly until his executive team envisioned Nedbank becoming Southern
Africas most highly rated and respected bank by its staff, clients, shareholders, regulators,
and communities.
Further, Boardman personally led strategy, values and brand workshops for the senior
leadership of the bank to brainstorm strategic direction, corporate aspirations, key focus
areas and core values.
While Brown encouraged innovation by setting an example and creating My financial
life, an application that aggregated information on assets, trusts, insurance and any other
financial data.
b) Inspirational Motivation:
Boardman successfully arranged dialogue workshops in which attended by most of his
managers. These opportunities enabled staff to contribute and therefore co-create the
strategy and values of the brand.
Similarly, Brown pondered on the culture of distrust and fear that had contributed to the
lack of an innovative culture within the organization before the start of the turnaround
strategy

c) Intellectual Stimulation:
Boardman encouraged their managers to discuss issues such as What does a successful
South Africa look like in 2030? and How can we make our products align to a green
economy? All staff members were invited to provide input in selecting the fifth value as
this represented buy-in into the shifting of the corporate culture.
As for Brown, he supported continuous innovation in the organization. His actions
encouraged more and more executives at Nedbank to follow his footsteps through leading
by example. Brown was also contemplating on how to maintain the momentum of culture
change. To this end, he was planning a culture known as Lekgotla, a word in the Sesotho
language meaning conference or discussion by the elders in the tribe gathered under a tree
of which was adopted by Nedbank for its management conferences.
d) Individual Consideration:
Boardman introduced the Talk to Tom concept, a vehicle for employees to directly share
with him their concerns and suggestions without fear of being victimized by their
immediate superiors. Summaries of the discussions from the strategy, values, and brand
(SVB) workshops were presented to, and approved by, the Nedbank Group Executive
Committee to develop a group strategy and clear direction for the group brand campaign.
Considering the initiatives level of success, Brown introduced the Talk to Mike blog,
where he personally responded to any staff members questions.
3. What are the implications of this example of Nedbank?
Answer:
The cascading of Nedbanks vision to the 5 stakeholder groups (i.e staff, clients,
shareholders, regulators, and communities) was deliberate. Focus was firstly on staff, as an
inspired, energized and aligned staff force would deliver superior service to customers and
this would affect how shareholders, regulators and communities would view the bank.

Nedbank was the only bank with regulators in its vision as one of its stakeholders. It
complied with Basel III regulations on open and transparent reporting. Learning from the
past, management minimized risk with regards to interest rates, unsecured lending and
foreign currency.

The leading by example taken by Brown in the aspect of applications creation allowed his
team to come up with new product ideas that aggregated information on assets, trusts,
insurance and any other financial data. Such innovation mojo was starting to gain
momentum.

The Lekgotla initiative successfully gathered 300 top managers to discuss the
organizations current culture and how to derive more value for customers from the effort
with culture. Ultimately, Nedbank created a strategy where it had to consider how to
capitalize on being part of the Old Mutual Group. Reflecting the turnaround, the previous
strategy of Back to the Top was changed to Growing to Greatness, reflecting the
growth strategy.

Boardmans initiative to gather his managers to discuss about Nedbanks direction in the
future ultimately aligned the aspiration to the governments National Development Plan,

and the Community Fair Share 2030 project was born, and the outcome was the peoplecentered value.
4. Are the results sustainable?
Answer:
Yes, the results is sustainable. Since the Boardman retired and replaced by Brown, the culture is
continued by Brown. For example, after Brown is appointed as CEO, he introduced the Talk
To Mike blog when he can respond to all staffs question personally. He also encouraged
innovation by setting an example and creating My financial life and pocketPOS
application. And this way leading by example also followed by the executive team at Nedbank
and result many new product ideas produced and theinnovation mojo was starting gain
momentum.
Brown also emphasized Nedbank focus on the importance of culture and values to all
stakeholders and to adapt to volatile and challenging economic environment. Brown also define
that success means balancing of life between work and home, and keep made strategies to
sustain financial growth in order to determined that Nedbank would not experience a repetition
of the low point of 2003 by focus on economic, environment, social and cultural.