Analysis of Marketing System: Commonwealth Bank's Royal Commission

This report provides a detailed analysis of the Commonwealth Bank (CBA) marketing system, focusing on the findings of the Royal Banking Commission regarding fraudulent activities. The report examines three major areas of misconduct: home lending through mortgage brokers, fees for no service, and Commonwealth financial planning. It explores how these issues relate to marketing strategies and utilizes Colman's boat to illustrate the complex nature of these problems. The analysis identifies the "wicked problems" faced by CBA and suggests recommendations for improvement, including enhancing communication with customers and improving service quality. Peer feedback and references are also included to support the analysis.

Running head: MARKETING SYSTEM ANALYSIS
MARKETING SYSTEM ANALYSIS
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction......................................................................................................................................2
Royal Banking Commission............................................................................................................2
Commonwealth Bank role in Royal Banking Commission.............................................................2
Role in Marketing Systems..............................................................................................................4
Recommendation.............................................................................................................................6
Peer feedback...................................................................................................................................7
References........................................................................................................................................9

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Introduction
The report will be based on a detailed review of the findings that have been gained by the
Royal Banking Commission based on the fraudulent activities performed by the banking or
different financial institutions. I will mainly discuss the impact of different fraudulent activities
with respect to marketing strategies that have not proved to be effective for the organizations.
Recommendations will be provided based on the ways by which the situation could have been
avoided by the organization and the alternative strategies that can be implemented as well. The
organization that has been selected for analysis in the report is Commonwealth Bank.
Royal Banking Commission
The Royal Banking Commission had been established in the year 2017 as a result of the
immense levels of pressure provided by public and the whistle blowers with respect to the
investigation needs to be conducted based on actions that are implemented by financial
organizations. The bribery based activities that have been performed by the banking and
financial institutions had also been a major reason behind the formation of The Royal Banking
Commission. The witnesses of various fraudulent activities had come forward with information
and this had led to the investigations that had been conducted by The Royal Banking
Commission (Royalcommission.gov.au 2020).
Commonwealth Bank role in Royal Banking Commission
The Commonwealth Bank of Australia or CBA is a global bank of Australian origin that
has its operations in New Zealand, the United Kingdom, the United States and different Asian
countries as well. The organization offers a wide variety of the financial services that include
institutional and business banking, retail banking, superannuation, management of funds, broking

3MARKETING SYSTEM ANALYSIS
and investment services and insurance (Commbank.com.au 2020). The Commonwealth Bank has
gained the position of the biggest Australian listed organization on Australian Securities
Exchange within the year 2015. Commonwealth Bank was established in the year 1911 by
Australian government and was further privatized in the year 1996 (Commbank.com.au 2020).
The Commonwealth Bank had faced major issues based on the operations that had been
performed by the organization in the last few years. The three major activities that had been
considered to be fraudulent by different institutions include home lending through the mortgage
brokers, fees for no service and Commonwealth financial planning (Commbank.com.au 2020).
Home lending through mortgages - The Royal Banking Commission had offered
recommendations related to the threats that are provided by the home lending through mortgages
by a major banking organization like The Commonwealth Bank of Australia. The Commission
had also threatened that competition can be harmed in a huge manner due to home lending based
activities that are performed by the bank. (Afr.com 2020)
Fees for no service - The Commonwealth Bank of Australia had also faced issues due to
the report provided by Royal Banking Commission based on fees that are charged by the bank
for no particular service. The service fees that had been paid by a majority of the customers were
actually not based on the services that are provided by the bank (Abc.net.au 2020).
Commonwealth financial planning - The Royal Banking Commission had also provided
a report based on financial planning based services that are provided by the Commonwealth
Bank. The Australian Securities and Investments Commission or ASIC had banned the financial
planning business of Commonwealth Bank. The financial planning had also been banned as the

4MARKETING SYSTEM ANALYSIS
bank had not solved the issues that were previously faced due to fees that were charged for no
services provided to customers (Smh.com.au 2020).
Role in Marketing Systems
The three major fraudulent activities including home lending through mortgages, fees for
no services and Commonwealth Bank Financial planning can be considered to be a part of the
concept of “wicked problem”. Wicked problems cannot be defined easily as the concept is
considered to be quite complex in nature and is based on different factors that are involved and
the causes that result in the development of unwanted scenarios (Duffy, Northey and van Esch
2017). The wicked problems can be part of different operating levels of the organizations and
can have a negative influence on the organizations as well. The social aspects related to wicked
problems have not been addressed in different researches and the social upheaval is considered to
be a major failure that is faced by the national industry (Chiang 2017).
The wicked problems that have been reported by Royal Banking Commission based on
operations of Commonwealth Bank of Australia are also wicked problems that have influenced
the consumers. The major intention of Commonwealth Bank of Australia behind the activities
performed by the organization is based on gaining profits. The decisions implemented by
Commonwealth Bank of Australia have led different fraudulent activities performed by the
organization (Domegan et al. 2019).
The situation faced by Commonwealth Bank of Australia can be explained with the
implementation of Colman’s boat. The Causal diagram will be able to relate the micro and the
macro levels with respect to the fraudulent activities that are performed by Commonwealth Bank

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of Australia. The upper part of the diagram explains the macro level and lower part is able to
provide details related to micro factors (Duffy, Northey and van Esch 2017).
Figure 1
– Coalman’s Boat
Source – (Duffy, Northey and van Esch 2017)
Next diagram will be able to explain wicked problems related to the policies of
Commonwealth Bank and the ways by which the consumers will be harmed due to the
investigation completed by Royal Banking Commission.

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Figure 2 – Coalman’s Boat
Source – (Duffy, Northey and van Esch 2017)
The diagram is able to depict that the Commonwealth Bank of Australia is providing
services like home lending and Commonwealth financial planning that has been able to play a
major role in enhancing the issues faced by the organization. The culture that has been formed
within Commonwealth Bank is also based on the vulnerable position that the organization has
formed in the banking industry. The consumers were also paying fees for the services that have
not been provided to them. The report of Royal Banking Commission has also stated that the
fraudulent activities have a major negative impact on the ways by which the organization has
maintained its position in the market (Haase, Becker and Pick 2018).
Recommendation
The map of Coalman’s boat has been used for the purpose of identifying a wicked
problem and it is also considered to be crucial for the marketing experts so find different

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complications that have a negative impact on the customer satisfaction levels. Coalman’s boat
can also be used for the purpose of developing solutions to the issues or wicked problems that
are being faced by the firm. The marketing team of CBA will need to identify the issues and they
have to implement the counter measures that can help in solving the issues as well.
Home lending through mortgages - The management of CBA will also implement the
Coalman’s Boat method in order to improve the position that has been gained by the
organization in the financial industry.
Fees for no service - The major problem that is being faced by CBA is mainly related to
the fees that have to be paid by the consumers without any services that are provided to them.
The organization thereby needs to improve communication with the consumers in order to ensure
that the image of the CBA can be improved and the organization can also gain trust of the
consumers.
Commonwealth financial planning - The predictions can also be made by the marketing
team of CBA based on enhancements in the services that can be offered to the consumers.
Financial planning can be done by CBA effectively if the organization is able to gain the trust of
customers.
Peer feedback
I had initially planned to implement the theory of the marketing systems for the purpose
of analyzing the situation and the issues that have been faced by the Commonwealth Bank of
Australia. The embedded exchange theory can also be implemented for the purpose of
understanding the major problems that have been faced by the organization with respect to the
levels of fraudulent activities that were performed. However, the peer reviews that I had received

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based on the implementation of this theory were quite poor and this had led to the changes that I
have made in the decision of using the Coalman’s Boat. The Coalman’s Boat has proved to be
the best way of analyzing the wicked problems that are faced by an organization like the
Commonwealth Bank of Australia.

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References
Abc.net.au 2020. CBA to stop charging 'fees for no service' for most customers. [online] ABC
News. Available at: https://www.abc.net.au/news/2019-02-04/asic-orders-commonwealth-bank-
to-stop-charging-financial-fees/10776870 [Accessed 19 Feb. 2020].
Afr.com 2020. Banking royal commission: Mortgage brokers fuming at loss of trailing
commissions. [online] Australian Financial Review. Available at:
https://www.afr.com/companies/financial-services/banking-royal-commission-mortgage-brokers-
fuming-at-loss-of-trailing-commissions-20190203-h1at24 [Accessed 19 Feb. 2020].
Chiang, W.Y., 2017. Discovering customer value for marketing systems: an empirical case
study. International Journal of Production Research, 55(17), pp.5157-5167.
Commbank.com.au 2020. About us - CommBank. [online] Commbank.com.au. Available at:
https://www.commbank.com.au/about-us.html?ei=CB-footer_about-commbank [Accessed 19
Feb. 2020].
Domegan, C., McHugh, P., Flaherty, T. and Duane, S., 2019. A dynamic stakeholders’
framework in a marketing systems setting. Journal of Macromarketing, 39(2), pp.136-150.
Duffy, S.M., Northey, G. and van Esch, P., 2017. Iceland: how social mechanisms drove the
financial collapse and why it’sa wicked problem. Journal of Social Marketing.
Haase, M., Becker, I. and Pick, D., 2018. Alternative economies as marketing systems? The role
of value creation and the criticism of economic growth. Journal of Macromarketing, 38(1),
pp.57-72.
Layton, R.A., 2011. Towards a theory of marketing systems. European journal of marketing.

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Royalcommission.gov.au 2020. [online] Available at:
https://financialservices.royalcommission.gov.au/Pages/default.aspx [Accessed 19 Feb. 2020].
Smh.com.au 2020. ASIC goes nuclear on CBA ahead of royal commission report. [online] The
Sydney Morning Herald. Available at:
https://www.smh.com.au/business/banking-and-finance/asic-goes-nuclear-on-cba-ahead-of-
royal-commission-report-20190204-p50vj7.html [Accessed 19 Feb. 2020].