He Gave Up the Chance to Be the CEO of Citibank

Ajay Banga left Citibank to head the much smaller Mastercard; increasing its value by 12x over 10 years. Read his unique takes on success, work-life balance, innovation and living through 9/11 in New York.

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Source: Youtube

Ajay Banga is a Sikh from India. It is the fifth most popular religion in the world. But due to the trademark turban and facial hair that male believers wore, he could easily be forgiven for looking like he came from the caves of Afghanistan, Wall Street suit notwithstanding.

Banga was still several rungs down the hierarchy from Citibank CEO Sandy Weill when 9/11 happened. He was living in New York and walking to work everyday.

Weill called him into the office and told him to take the company jet instead of commercial flights for the next few months to avoid immigration issues. It was a privilege Banga wasn’t entitled to yet at his rank.

Concerned for his safety, Weill also told Banga to stop walking to and fro work and use his car instead.

Nonetheless, Banga decided to continue his daily commute by foot. Occasionally, his boss would come to his house in the morning and walk with him.

“That’s pretty cool. That’s leadership,” Banga recounted in The Top Talk at the Stanford Graduate School of Business (GSB).

Banga stayed in Citibank for 13 years until 2009. He was, by then, CEO of Citibank Asia Pacific, overseeing two thirds of the company’s staff. His bosses were publicly preparing him to take over the top job.

But he left instead, to become the CEO of Mastercard — which had only about 5,100 employees at that time, compared to the nearly 300,000 at Citibank.

He looked to the future and decided that banks were going to shrink as a result of regulations. Rather than be hampered by increasing government scrutiny, Mastercard appealed to him as a brand new place to pursue innovation and growth in the age of Fintech and big data.

He also felt it was impossible to change culture in a company of hundreds of thousands within a five-year horizon. Mastercard’s far smaller size, in contrast, would allow him to connect directly with his staff and make a difference.

Five years after he took over, Mastercard’s share price tripled. A decade on, it is up nearly 12x.

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Mastercard share price since Ajay Banga became CEO. Source: TradingView

Over the course of his illustrious career at Nestlé, Pepsico, Citibank and now Mastercard, there are a few qualities Banga holds dear.

The bosses he served under taught him humility and perseverance.

He recounted how his old boss at Nestle and also Sandy Weill at Citibank were incredible people persons. They dealt with folks from all walks of life and positions with the same intensity of interest and purpose.

To him, humility was a key part of success.

“I think you can be successful without the humility, but you won’t enjoy it as much.”

His boss at Nestlé made a particularly strong impression on him. He told him never to take no for an answer in business.

“There is always a way to get to the right solution. If you apply your mind, don’t take the hurdles that come in your way as the reason why you’d move around them or give up…” Banga recalled.

He also taught Banga that one person can make a difference.

“(Even if) you are one person, you can make a difference; if you have the energy and the passion, and if you know how to communicate well.”

Communication was key to influencing changes, Banga said. He also felt that it was an underrated yet “the most important attribute as you grow”.

Banga thought that work-life balance is very hard to define based on hours spent working. It is very much a personal decision.

For him, first and foremost a person needs to enjoy his work. In his own words, it is “really, really critical”.

“Work-life balance starts with enjoying what you do, really well.”

“If you don’t enjoy what you are doing, it’s time to do something different.” And that, he said, pretty much summed up his career moves over the years.

Beyond that, Banga felt it is important to find time for yourself and the people important to you — and to make it quality time instead of fiddling with your phone or other distractions.

“…when you are with somebody, spend the time with the person…”

Being focused on the person shows them they matter to you. And that was pretty much how he maintained his balance and family life.

Banga’s approach to innovation was also highly disciplined and unusual.

He created a group called Mastercard Labs across four countries, and kept them separated from the rest of the company.

They also had their own budget which only he had control over. Not even his CFO was allowed to question or change it.

But for that money, he didn’t ask for a budget or financial forecast from the group. He believed it was pointless.

“…you can produce a spreadsheet and it has 24 sub spreadsheets, you change the number on the 23rd one in roll 7 column 14. And your entry on the first page becomes 35% instead of 3.5%. I’ll never find it… It’s a waste of my time.”

Instead, he gave them a simple mission to produce two commercially viable products in two years. Otherwise, he’d fire all of them, and start over.

According to Banga, it worked. The lab produced four products for incubation, of which three showed great promise, and were being ran by female technologists.

As an ethnic minority in most of the countries he’s worked in, Banga was used to being stared at.

In the post-9/11 days, he often received verbal abuse as he walked in the streets.

But he decided to face it head on instead of taking up Weill’s offer to commute via his private car. He believed that the overwhelming majority were on his side and sensitive to the feelings of minorities.

He also believed that, “If you have that strength, you can get through a lot of stuff.”

That attitude towards human compassion and diversity was something he practiced in his corporate career.

Diversity to him was a boost.

“… I focus on it with a great deal of energy, to surround myself with people who are different from me.”

But he doesn’t believe in the notion of ‘diversity hires’. He said he would quit immediately if ever he was told that he was one.

“Diversity is about having people around you who don’t think like you, walk like you or talk like you.”

He felt that if you were truly open minded, your company would naturally be made up of diverse employees.

Author’s note: The above was largely extracted from a 50 minutes talk he gave at Stanford GSB in 2014. Dated as it may be, he is perhaps the most underrated CEO I’ve came across. His talk was full of unique insights and definitely worth watching.

I’ll leave you with one last quote, that seems to sum up the man and what he’s about.

“…by the actions we take…we can do well, and do good at the same time.”

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I write about business, technology and society... Investor | Entrepreneur | Thinker 🔗 http://www.linkedin.com/in/lancengym/

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