Strategic Shift of Credit Underwriting Functions to Offshore Team

A large financial institution aimed to optimize operational efficiency and reduce costs by transitioning lower complexity credit underwriting work from its team of 450 domestic professionals to a newly established team in India. This strategic initiative was implemented over three years and was part of a broader mission to elevate the roles of experienced underwriters and streamline location strategy.

Challenges & Considerations

– Ensuring seamless knowledge transfer and skill development for the offshore team.

– Maintaining high standards of client service during the transition.

– Building robust communication channels to facilitate cross-border collaboration.

– Managing resistance to change and ensuring stakeholder buy-in.

The primary goal was to develop a model that could:

Transition 30% of lower complexity credit underwriting work to an offshore team.
Improve client response times using a follow-the-sun model.
Develop managerial and mentoring skills among experienced domestic underwriters.
Achieve significant annual savings in compensation and occupancy costs.

Approach & Implementation

Programmatic Transition

The transition was executed programmatically, with work being migrated in waves to manage risks and ensure readiness at each stage. This phased approach allowed for incremental adjustments and minimized disruptions.

Cross-Border Partnerships

Strong cross-border partnerships were cultivated by appointing domestic champions to mentor and guide the offshore team. These champions played a crucial role in knowledge transfer and ensuring alignment with the organization’s standards.

Training and Alignment

The offshore team received extensive in-person training to develop the necessary skills. They were aligned with a corresponding domestic leader and peer group to provide ongoing support and ensure seamless integration.

Continuous Feedback and Development

Continuous feedback and development mechanisms were implemented to help the offshore team enhance their capabilities. Regular performance reviews and developmental feedback facilitated their growth and readiness to take on increasing responsibilities.

Communication Strategy

A robust communication strategy was established to maintain transparency and engagement across all stakeholders. Regular updates, feedback sessions, and open communication channels were critical in addressing concerns and ensuring alignment.

Outcomes

Enhanced Managerial and Mentoring Experience: Domestic underwriters transitioned to reviewer roles, gaining valuable managerial and mentoring experience.
Cost Savings: The strategic shift resulted in millions of dollars in annual compensation and occupancy cost savings.
Improved Client Response Times: The follow-the-sun model enabled faster turnaround on credit decisions, leading to higher client satisfaction.

The strategic transition of lower complexity credit underwriting work to an offshore team in India was successfully executed, achieving significant cost savings, enhancing operational efficiency, and improving client service. This case study demonstrates the effectiveness of strategic workforce management and global collaboration in driving organizational success.