What business are you in?

A question every Mortgage professional should ask

Today, we are going to have conversation on a topic that is basic to every business yet powerful that will change the way you look at your business. There is something for everyone in this conversion that we are going to have. Please enjoy while you hear to this conversation and bring a difference in your life.

For long, I have been thinking about this question “what business are you in? in the context of housing finance companies. I am sure when you hear this question, it may sound like a hackneyed phrase. Already your mind would be working to make a comment. This can also bring a smile on your face taking back to your first few days spent in the management school trying to learn business models or discussing on case studies on the similar lines.

In the last five years of my consulting experience with small & large businesses and even in my own business, this is one question I have been repeating in most important workshops taking the leaders through the basics.

One big learning from all these experiences has been to get every leader respond to this question, whenever you want to do soul searching. The response to the question actually defines how you look at your business which in turn defines your products and services, the way you would like to access your customer segments, the value proposition that you want to offer your customers. Actually, the entire set of questions around the business gets framed. This clarity not only helps you as owner or manager but also assist you in sharing the ethos of the business with your teams.

Let me take a live business case that can bring out the importance of the question raised here. I am always fascinated with the example of how railways define their business. We always associate the business of Railways as transportation of people. Well, that is not the way they define for themselves. The railways state that there are in the business of “environmentally sustainable integrated transportation solutions”. Let me repeat to get the crux of the statement, it states “environmentally sustainable integrated transportation solutions”. It is so interesting to note that they talk about transportation solution. Moment, they have stated it as transportation solution it goes beyond, passenger traffic that they are normally associated with. A simple set of five words helps them to go beyond passenger traffic, or any specific type of goods or mode of transportation which could be rail, air, sea or by road and within each of the customer segments it is about solution. I am sure this enable everyone in the organization to live, breathe the purpose of the organization. This also ensures the longevity of the business as they unravel the possibilities to serve the customer needs.


Let me leave with one more example that I love to state. This is about our Indian grown brand, Café Coffee Day or CCD as it is popularly known. They define their business as “lot of things can happen over a cup of coffee”. It so beautiful and they go further to explain which goes like this “Conversations are what make our cafes worth remembering, our customers tell us. If only we had a way to track the thousands of great ideas that have come about at CCDs, that would've been cool, right? So let us discuss. Are they selling coffee or an environment where ideas trigger over cup of coffee? It is so beautifully put that CCD would do all the things around coffee and yet maintain a focus on coffee that would trigger millions of ideas. I must confess that in my initial days of business, CCDs use to be my preferred choice to have conversations with my clients and colleagues.

Let me bring this context to a housing finance company. When you ask this question to a mortgage professional, the most obvious answer would be we are in the in business of providing homes” or more clarified version of it would be “we provide home loans”. Is it really true? The first response obviously is not right. All of us would agree that housing finance companies do not provide homes, probably that may be stated by a developer at a functional level. The second response “we provide home loans” looks obvious but it is so narrow that it looks like selling any other commodity like rice or wheat or pulses. To me, it gives a raw feeling and I see similar despondency setting-in amongst the professionals while delivering the product. You may ask why? The reason is that it becomes just a sales number for a sales manager or one more appraisal for a credit professional, a land revenue number of the customer property for technical or legal person and a file number for an operation professional.

Let me move forward and introduce the magic word “SOLUTION” and we get the statement as “we are in the business of providing home loan solutions”. See the impact of introducing just one word, setting a change in the thought process. Now, I am sure a sales professional will not say what he has in his empty sales bag but would try to find what are the customer wants and needs. This would help in providing a solution with a combined benefits that the customer wants rather than a product with features that appeals to only the company. Similarly, for the credit it becomes an interesting proposition for crafting a credit solution or for technical and legal it will become a process of nurturing and shaping the product in the best interest of the customer and for operations it is like a flower that needs to be taken care till it blossoms and remains there to give regular fruits till the end of the loan period.

Let us move away from this syndrome of delivering commodities as it neither gives pleasure to self or to the customer and most importantly revenue from the business. I strongly urge each one of you to ask this question, “What business are you are in?” as you read to this article. In mortgage industry, I invite every person to position himself or herself as a professional providing mortgage solutions. Welcome to the new world.

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