Westpac Banking Corporation Analysis

This assignment requires an in-depth analysis of the Westpac Banking Corporation. It necessitates examining the bank's internal environment (strengths and weaknesses) and external environment (opportunities and threats) using SWOT analysis. Additionally, a PESTEL analysis is needed to evaluate the political, economic, social, technological, environmental, and legal factors influencing Westpac. The assignment relies on various provided sources, including academic journals, news articles, and official Westpac documents.

Management Strategic
Management

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Executive summary
Strategic management is all about the strategies that the managers of every organization carry to
achieve better performance. Each and every organization in the competitive world is looking to
form the strategies that help the company to grow in the global market. Expansion of the
company in the global market gives rise to the competition. Then, the company has to form the
strategies to face the competition. The report will talk about the strategic management of the
Westpac Banking Corporation. It includes the strategies formed by the company in the past few
years considering the changes in the current environment. The company is bringing changes in
the current strategy as the change in the environment. To bring the changes the company makes
use of the PESTLE framework and SWOT analysis as this is the best way to analyze the factors
that can impact the strategies of the company. Moreover, the report includes the Westpac core
values and the leadership styles that lead to the organization culture.

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Contents
Executive summary.........................................................................................................................1
Introduction......................................................................................................................................3
Overview of company......................................................................................................................4
Strategy and vision......................................................................................................................4
Criticism of business practice..........................................................................................................5
Environmental analysis....................................................................................................................7
PESTLE analysis.........................................................................................................................7
Political factors........................................................................................................................7
Economic factors.....................................................................................................................8
Social factors...........................................................................................................................8
Technological..........................................................................................................................8
Environmental factors..............................................................................................................9
Legal factors............................................................................................................................9
SWOT analysis................................................................................................................................9
Core values of company................................................................................................................10
Westpac's organizational leadership shadow.................................................................................11
Conclusion.....................................................................................................................................13
References......................................................................................................................................14

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Introduction
Strategic management involves setting objectives, analyzing the internal organization and
competitive environment within an organization. The organization that has been selected for the
strategic management is Westpac Banking Corporation. The company is commonly known as
Westpac in Australia as the corporation who works as Australian bank and financial services
provider and company is having the headquarters in Westpac Place, Sydney (Westpac Banking
Corporation, 2018).
The report reflects the strategies that help the company in achieving the growth and
development. Moreover, it includes the criticisms of the business practices that are pursued by
the company over the years. The environmental analysis of the organization is discussed in a
report as the external factors might create the impact on the decision related to the strategies.

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Overview of company
Westpac is Australia’s first and oldest bank that came into existence in the year 1817 as the bank
of New South Wales under a charter of incorporation provided by Governor Lachlan Macquarie.
In the year 1982, the name of the bank changed to the Westpac banking corporation. The
company has 5 customer facing divisions that are serving around 13 million customers. The
operating strategy aligns the business with the customer segments. The company retains a unique
portfolio of brands which include Westpac, St. George, Bank of Melbourne, BankSA and RAMS
(Westpac Banking Corporation, 2018).
Strategy and vision
Mission- The mission of the company is to meet the customer needs and leads to the customer
satisfaction which helps in achieving the vision of company (Westpac Banking Corporation,
2018).
Vision- Westpac vision is to be one of the world’s great service companies that provide the help
to the communities, customers and the people to grow and prosper (Westpac Banking
Corporation, 2018).
Past strategy
The strategy of the company was to provide superior returns to shareholders, to form enduring
and strong relationship with the customers, to be a leader in the community and to make a place
where the best people like to work. The company strategy helped the company in achieving the
vision of the company.

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The company is focused on core markets of the Australia and New Zealand where the company
provides a comprehensive range of financial products and services that help the company in
fulfilling the needs of the customers. The implementation of strategy seeks to grow a number of
customers in the selected segments. The company is trying to maintain the flexibility in their
strategies to meet the expectations of the customers (Westpac Banking Corporation, 2018).
Current strategy
To meet the challenges in the present market the company brings the changes in the strategies.
Westpac believes in keeping the strategy on the priority and according to the current market the
company refresh and review the strategies each and every year. The company tries to manage
these strategies in a balanced way with an appropriate mix of return, growth, productivity, and
risk. Currently, the company is focusing on improving the financial position that creating an
impact on the company. The better financial position will help the company in achieving the
growth and development (Westpac Banking Corporation, 2018).
Criticism of business practice
The business practice of Westpac banking corporation is to provide the financial services brands
and businesses to the customers and the communities so that they will be able to grow and
prosper. Different people in the country are having different needs and this is the reason due to
which the company is serving the 5 divisions to its customers.
The range of stakeholders is important for the company as this is the only way left with the
company that helps the company in understanding the current issues along with the emerging
trends (Carriline, 2008). Westpac is having the range of channels and mechanisms that help the
company in collecting and monitoring this feedback across our business. There are some of the

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stakeholders who contribute to the development of the policy by sharing their feedbacks and
issues. The criticism is reflected in the negative feedback of the shareholders towards the
business practice.
Customers- Westpac track and analysis the feedback shared by the customers through calls,
online surveys, and e-mails. The feedback of this shareholder is every important for Westpac as
the company is working for the benefit of their customers. Customers shared the issues faced by
them in the year 2012 related to the business practice of the company. The customers found the
faults in the security and the reliability of the service due to lack of the technology advancement.
Westpac practice is not able to fulfill the expectations of some customers in the context of the
customer service (Westpac Group, 2012).
Employees- The employees of the company shared their feedbacks through suggestion boxes,
staff perspectives survey, meetings and campaigns. Employees found downfall in the business
practice due to the lack of the leadership practice which leads retention of the employees. To
make the business practice successful the managers or leaders of the company have to take
correct steps keeping the employees together.
Investment community- Westpac take the feedback from the investment community through a
formal survey, questions, briefings, or can take the feedback at the time of the Annual General
Meetings. In the year 2012, investors found the faults in the management of the impact of the
financial crisis. Lack of management of financial crises creates an impact on the amount invested
by the investors. Investors expect good returns which are not possible to get if there is lack of
management (Westpac Group, 2012).

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Industry expert- Westpac Company found the criticism from their stakeholders and industry
experts. As per the news article was written by a political reporter, ASIC (Australian Securities
and Investments Commission) banned an employee of Westpac from offering the financial
services for 4 years because he entered false data or information related to the client’s health in
Westpac life insurance applications. National Australian bank (NBA) has banned employee for
giving any expert advice in the industry. The company faced the critics from ASIC and NBA
who are known as the industry experts of financial and investment management (Patel, 2016).
Environmental analysis
PESTLE analysis
PESTLE analysis is the strategic tool that helps the Westpac Company in analyzing the factors
that can influence the decisions of the company.
(Source: Fern Fort University, 2017)

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Political factors
The political factors can impact the Westpac profitability in the certain market or country. The
company is operating and expanding the business in many countries. Westpac needs to perform
the analysis to achieve the success in the countries having a diversified political environment.
 Westpac needs to analysis the trade regulations and tariffs that are associated with banks
globally.
 Pricing regulations might affect the revenue or profitability of Westpac. Hence, the
company needs to analyze the pricing regulatory mechanism for banks in the country
where the company is looking to expand the business.
 There is variation in the legislation such as taxation, wage legislation, work week
regulations, employee’s benefits regulations and many others from country to country
(Fern Fort University, 2017).
Economic factors
Improved business activities can affect the decisions of the bank. The rise in the business activity
leads to the non-mining business environment. This results in increased demand for housing
loans and new investment in-dwelling. Westpac can find the growth or hike in the investment
and deposits by the people. The controlled inflation rate, lowered GDP, and moderate
employment growth might force the central bank of Australia to maintain the cash rate at 2.5%.
This leads to changes in the decision related to the strategy of banks (Mba Skool.com, 2017).
Social factors
The social factors include the preference and demand of the customers for the money might vary
considering the situation of the country. The increase in the employment-population creates the

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impact on the customer’s deposit. In Australia, the labor market is soft and in 2015 at the
starting, there was a decline in employed population then the people made use of savings for
survival which reduced the profitability of Westpac. The rise in the employee's population
increased the number of customer saving accounts and amount in their accounts which results in
the increase in the revenue of Westpac (Fern Fort University, 2017).
Technological
To maintain the confidentiality of customer’s data is important for banks. Westpac acquires
around 11% in Quintessence Labs which is an expert in technology security. The use of
technology is increasing in banks and with the use of technology, the Westpac is able to provide
the digitalized services to their customers. This strategy helps the bank in winning the trust of
customers and result in high revenue (Mba Skool.com, 2017).
Environmental factors
Westpac has adopted an inclusive approach where the company engages with all the stakeholders
include customers, employees and other groups to create a sustainable economy. The bank
launched the green bond after partnering with World Bank to safeguard the environment. It
borrowed $8 billion for the environmental service sectors for cleanness. The aim of the bank is to
maintain the carbon neutrality, recycling and reducing power and paper usage.
Legal factors
Westpac is dealing with the class action suit for charging high penalties to the household
customers for the late credit card payments, increasing credit card limits and making a business
deal with inadequate funds in the account. These activities affect the goodwill of the company
not only in the home country but also in international countries where the company is operating

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its business. This results in the decrease in customer trust and revenue (Fern Fort University,
2017).
SWOT analysis
Strengths
 One of the leading companies in terms of a number of branches and ATMs in Australia.
 The bank is second largest lending banking in Australia.
 Westpac has been defined as world’s most socially responsible banks (Westpac Banking
Corporation, 2018).
Weaknesses
 The strategies of the company are not strong to face the high competition in retail
banking from other top ranks banks.
Opportunities
 The company is having the license to open its operations in new markets globally.
 The company is having an opportunity to develop new banking products with the help of
high technology and innovation (SWOT & PESTLE.com, 2017).
Threats
 Regulatory and credit limit changes are one of leading threats for Westpac.
 Worsening economy of New Zealand and Australia is a threat to the company as it will
affect the bank.

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Core values of company
Supporting our customer-focused strategy is a tough set of company-wide values which are well
surrounded by Westpac culture. The core values of the company include: -
 Delighting customers- By deeply understanding customer’s needs and expectations.
 One team- Valuing each other and working together to provide best possible outcomes to
customers and organizations (Westpac Banking Corporation, 2018).
 Integrity- Each and every employee in the organization is accountable for their actions,
work, honesty and doing the right thing.
 Courage- Company is having the courage to deal with change because the company think
boldly and finding innovative methods of performing work.
 Achievement- Pursuing team, personal and business excellence.
Westpac's organizational leadership shadow
The leadership shadow model was created by CEW in association with the Male Champions of
Change group. Westpac Leadership shows the action taken by the CEO of the company to drive
the gender equity across the organization which reflects the culture of the company.

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(Source: Smith-Gander, D., 2017)
The image shows the leadership shadow of the Westpac Banking Corporation. The CEO of the
company believes wants to focus on inclusive leadership development. The company knows the
role of investing in management capabilities to support diversity and has identified that there is
need of better leadership skills to support and maintain to sustain improved gender diversity. A
variety of programs strengthens the link between leadership skills (Smith-Gander, 2017).
According to the CEW member, “Gender inclusive leaders are generally just the best leader’s
full stop. None of those great leaders say ‘I’ am going to lose as a result of this desire to increase
the numbers of senior women leaders.”

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Conclusion
The report shows the strategic management of the Westpac Banking Corporation. It can be
concluded from the report that the strategies formed by the company are for the betterment of the
customers and the community. The strategy also helps the company in achieving the vision and
mission of the company. Moreover, stakeholders and other people show the criticism of the
business practice of the company. The environmental analysis is discussed that can create an
impact on the working of the company. The company should try to work on the strategies related
to the retail market as it is a weakness of the company. Westpac organization leadership shadow
that reflects the organization culture is discussed.

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References
Carriline, A. 2008. Strategy and Performance Management. [Online] Available at
http://info.westpac.com.au/annualreport2008/default.aspx?PID=273 [Accessed 11th January
2018].
Fern Fort University, 2017. Westpac Banking Corporation PESTEL & Environment Analysis.
[Online]. Available at http://fernfortuniversity.com/term-papers/pestel/nyse4/4215-westpac-
banking-corporation.php [Accessed 11th January 2018].
Mba Skool.com, 2017. Westpac Banking Group SWOT Analysis, USP & Competitors. [Online].
Available at https://www.mbaskool.com/brandguide/banking-and-financial-services/1985-
westpac-banking-group.html [Accessed 11th January 2018].
Patel, U., 2016. Westpac, NAB to face grilling as bank inquiry focuses on banned financial
advisers. ABC News, 5th October. [News] Available at
http://www.abc.net.au/news/2016-10-06/banking-hearing-to-focus-on-banned-financial-
advisers/7906908 [Accessed 11th January 2018].
Smith-Gander, D., 2017. Westpac. [pdf] Available at
https://cew.org.au/wp-content/uploads/2016/07/CEW_CaseStudy_Westpac_WebFinal.pdf
[Accessed 11th January 2018].
SWOT & PESTLE.com, 2017. Westpac SWOT & PESTLE. [Online]. Available at
https://www.swotandpestle.com/westpac/ [Accessed 11th January 2018].

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Westpac Banking Corporation, 2018. About us. [website]. Available at
https://www.westpac.com.au/about-westpac/westpac-group/company-overview/about-us/
[Accessed 11th January 2018].
Westpac Banking Corporation, 2018. Our businesses. [website]. Available at
https://www.westpac.com.au/about-westpac/westpac-group/company-overview/our-businesses/
[Accessed 11th January 2018].
Westpac Banking Corporation, 2018. Our history. [website]. Available at
https://www.westpac.com.au/about-westpac/westpac-group/company-overview/our-history/
[Accessed 11th January 2018].
Westpac Banking Corporation, 2018. Our strategic priorities. [website]. Available at
https://www.westpac.com.au/about-westpac/westpac-group/company-overview/our-strategic-
priorities/ [Accessed 11th January 2018].
Westpac Banking Corporation, 2018. Our strategy and vision. [website]. Available at
https://www.westpac.com.au/about-westpac/westpac-group/company-overview/our-strategy-
vision [Accessed 11th January 2018].
Westpac Group, 2012. Westpac Group Annual Review And Sustainability Report 2012. [pdf]
Available at
https://www.westpac.com.au/docs/pdf/aw/ic/2012_Annual_Review_and_Sustainability_Report.p
df [Accessed 11th January 2018].