Management Field Project: Doha Bank SME Lending Turnaround Time

This management field project examines the inefficiencies in Doha Bank's SME lending model, particularly focusing on the critical issue of prolonged turnaround times. The project begins with a thorough background analysis, outlining the importance of SMEs in Qatar's economic diversification and the competitive pressures faced by Doha Bank. Through SWOT analysis and problem identification, the study pinpoints delays in the lending process, leading to customer dissatisfaction and potential revenue loss. The theoretical framework explores policy and procedures, employee productivity, and time management as key factors influencing turnaround time. The project proposes a revised lending operational model, including changes to policies and procedures, employee training to enhance productivity, and the implementation of time management strategies. The findings suggest the need for a program lending model, streamlining processes, and leveraging internal resources to improve efficiency and address the identified constraints. Recommendations include revising policies, improving employee productivity, and implementing turnaround time targets to enhance the overall efficiency of the SME lending process.

IMPROVING TURNAROUND TIME OF DOHA
BANK’S SME LEDNING MODEL
2018

IMPROVING TURNAROUND TIME OF DOHA BANK’S SME
LEDNING MODEL
Colombo – Sri Lanka
2018
This is to certify that the Management Field Project on
IMPROVING TURNAROUND TIME OF DOHA BANK’S SME
LEDNING MODEL

TABLE OF CONTENTS
List of Tables.............................................................................................................................7
List of Figures ...........................................................................................................................7
List of Abbreviations.................................................................................................................8
Executive Summary ................................................................................................................10
Chapter 1..................................................................................................................................11
INTRODUCTION...................................................................................................................11
1.1 Background ..................................................................................................................11
1.2 Project............................................................................................................................12
1.3 Significance of the study...............................................................................................12
1.4 Methodology ................................................................................................................13
1.5 Limitation......................................................................................................................14
1.6 Chapter Framework.......................................................................................................14
Chapter 2..................................................................................................................................15
PROBLEM IDENTIFICATION..............................................................................................15
2.1 Introduction...................................................................................................................15
2.2 Organization Profile......................................................................................................15
2.3 Organizational Analysis: SME Section at Doha Bank..................................................18
2.3.1 SWOT Analysis: SME Lending at Doha Bank......................................................18
2.3.1.1 Strengths..............................................................................................................19
2.3.1.2 Weaknesses..........................................................................................................19
2.3.1.3 Opportunities ......................................................................................................20
2.3.1.4 Threats ................................................................................................................21
2.3.1.5 Conclusion of SWOT Analysis...........................................................................22
2.4 Problem Identification...................................................................................................23
2.5 Problem Description......................................................................................................23
2.6 Summary ......................................................................................................................28
Chapter 3..................................................................................................................................29
THEORETICAL FRAMEWORK FOR DIAGNOSIS............................................................29
3.1 Introduction...................................................................................................................29
3.2 Theoretical background to the problem........................................................................29
3.2.1 Policy and Procedures ...........................................................................................32
3.2.2 Employee Productivity ..........................................................................................33
3.2.3 Time Management .................................................................................................34
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3.3 Framework of the study.................................................................................................35
Source: Author....................................................................................................................36
3.4 Description of the Techniques.......................................................................................36
3.4.1. Cause and Effect analysis..........................................................................................36
3.4.2. Time and motion study .........................................................................................36
3.5 Summary.......................................................................................................................37
Chapter 4..................................................................................................................................38
THE PROJECT........................................................................................................................38
4.1 Introduction...................................................................................................................38
4.2 Project Objectives.........................................................................................................38
4.2.1 The Prime Objective...............................................................................................38
4.3 The Project; Project Components..................................................................................39
Source: Author ................................................................................................................39
4.3.1 Component 1: Current situation analysis .............................................................39
4.3.1.1 Cause and effects analysis...................................................................................41
4.3.1.2 Kipling’s Method.................................................................................................42
4.3.2 Project component 2: Policy and Procedures........................................................42
4.3.2.1 Solution and Development: Revise of Policy & Procedures...............................44
Source: Credit department Doha bank ............................................................................47
4.3.3 Project component 3: Employee productivity .......................................................47
4.3.3.1 Solution and Development: Employee Productivity.........................................47
4.3.4 Project component 4 : Time Management..............................................................48
4.3.4.1 Solution and Developments: Time Management ...............................................49
4.4 Resource Allocation......................................................................................................49
4.5 Cost Estimates and Cost Benefits .................................................................................51
4.6 Project output and outcomes.........................................................................................51
4.7 Project plan....................................................................................................................53
4.7 Summary.......................................................................................................................53
Chapter 5..................................................................................................................................55
DISCUSSION OF IDENTIFIED COMPONENTS................................................................55
5.1 Introduction...................................................................................................................55
5.2 Discussion ....................................................................................................................55
5.2.1 Current Situation Analysis......................................................................................56
5.2.2 Policy & Procedures...............................................................................................56
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5.2.3 Employee Productivity...........................................................................................57
5.2.4 Time Management..................................................................................................57
5.3 Recommendations.........................................................................................................58
5.3.2 Periodical update of policy and procedures...............................................................58
5.3.4 Turnaround Time implementation for processes ......................................................59
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List of Tables
Table 2.1: Doha Bank’s Financial Highlights
Table 2.2: Doha Bank’s Ratio Highlights
Table 2.3: SWOT Analysis: SME Lending at Doha Bank
Table 2.4: Problem Identification Diagram
Table 2.5: Average Turnaround Time Delays
Table 2.6: Existing Loans and Customers
Table 2.7: New Projects and Customers
Table 2.8: Income Statements
Table 2.9: Application Processing
Table 2.10: DB Key Performance Areas
Table 2.11: Numbers of Complaints
Table 2.12: SME Complaints Details
Table 2.13: SME complaints and Impacts
Table 4.1: Project Components and Techniques
Table 4.2: Current situation analysis tools
Table 4.3: Kipling’s Method
Table 4.4: 5 Why
Table 4.5: Loan process - workflow Chart
Table 4.6: Policy and Procedure Amendments
Table 4.7: SME program lending model
Table 4.8: Turnaround Time vs Loan Process stages
Table 4.9: Time and motion study Loan process workflow
Table 4.10: Resource allocation of project
Table 4.11: Cost Estimates
Table 4.12: Cost Benefits
Table 4.13: Project output /outcomes
Table 4.14: Project Time Planners
Table 5.1: The 5W +1H
List of Figures
Figure 3.1: Study Framework
Figure 4.1: Ishikawa diagram – Cause and Effects
Figure 4.2: Project Team Structure
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List of Abbreviations
SME Small and Medium Enterprise
GCC Gulf Cooperation Council
ATM Automated Teller Machine
UAE United Arab Emirates
CSR Corporate Social Responsibility
DB Doha Bank
IT Information Technology
RM Relationship Manager
HR Human Resources
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Acknowledgements
I extend my sincere
gratitude to all who have contributed in numerous ways and supported me in my
Management Field Project to make it a reality. My Project Supervisor Dr. A.K.L Jayawadana
for his valuable guidance and support extended throughout project work. Also would like to
show my sincere thanks and gracefulness from bottom of my heart to the Director PIM
Professor Ajantha Dharmasiri for endless assistance. My heartfelt gratitude is also carried
forward to all PIM lectures for the suggestions and directions given to accomplish the goal of
completion of this management field project successfully.
All faculty guides of PIM who have added invaluable knowledge and extended
continuous encouragement and guidance throughout the MBA programme. All management
and administration staff at Postgraduate Institute of Management for providing me the
opportunity to pursue this course of study.
My friends, colleagues from various banks who responded to my queries and assisted
me to complete this project successfully. Last but not least my sincere gratitude goes out to
my family for being my greatest inspiration and strength in my accomplishments and
encouraging me to pursue this MBA programme. The MBA gives me a great sense of
satisfaction and accomplishment of a lifelong ambition.
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Executive Summary
Small and Medium Enterprises attract Banks all over the world to a greater extent in
current era with the aim to increase market share and revenue. Nevertheless, Doha bank
indicates the lowest financial perception into SME portion inside Qatar irrespective of
strategic direction committed by government to diversify its economy with significance
given to developing of Bank’s SME portfolio. Aim of this management field study project is
to reduce/minimise turnaround time of Doha bank’s small and medium lending process
model. In the states of Qatar Doha bank is one of the biggest and largest private sector bank
which is expanded across Gulf and Asian region. Small and Medium unit of Doha bank deals
with all SME loan requests through a centralized operational system covering worldwide
network. The work study itself is preponderantly explorative in nature and serves with a brief
perspective of Doha Bank's SME unit with a distinct aim of establishing an efficient lending
operating model to gain competitive advantage which will lead to revenue maximization.
After investigation conducted of Doha SME banking position, it is proven through
trial and error that the operational environment and bank’s lending structure plays a
nitpicking role in uplifting SME’s financial approachability. Primary study, focused on Doha
bank’s SME unit perception and approach in handling SME lending reveal inefficiencies,
unit’s internal structural weaknesses to be key out concerns depriving SME growth. The
SME operational lending model fails to satisfy the standard turnaround time. As a result bank
encounters numerous of customer delay issues, complaints, losing potential clients to
competitors and inter related income/revenue losses.
Management Field Project study findings expose the Doha bank’s SME lending
model, that is to be revitalized in order to overcome identified constraints as solution. On the
basis of project findings, suggestions are made to introduce a Program Lending Model to
Doha bank’s SME lending. In terms of budget or cost can be overcome by using internal
resources for creating new software adding into the bank’s main system. Recommendations
include the need of revising policy and procedures, improving employee productivity via
training & development and implementing turnaround time to all related SME lending
activities in order overcome the time management issues.
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Chapter 1
INTRODUCTION
1.1 Background
SMEs play a critical role in advancement, sustainable development and innovation
worldwide. In today’s world of globalization, SMEs across the world have to compete
globally. To increase market share and revenue growth SMEs attract greater attention of
Banks worldwide in current era. Despite of State’s committed strategic direction, Qatar’s
financial sector highlights the lowest financing insight into SME segment within the GCC to
diversify its economy with significance of developing the local SMEs. This segment is the
best alternative untapped market which is profitable for Qatari banks, resulted in aggressive
competition and regulatory interventions in Retail space in corporate space eroding banking
sector profitability. The complexities which were identified in Investment banking arena are
encouraging SME banking to promote bank’s bottommost line in a risk disinclined manner.
Doha Bank was the first bank in Qatar which understood and appreciated the
significance of the critical and crucial role played by SMEs in the development of the Qatari
economy. In this view, by launching ‘Tatweer’ Doha Bank became the first bank to launch a
dedicated SME unit in 2008. SME support is required by the infrastructure development
taking place in Qatar in the form of Airports, ports, rail, roads, telecom and other
construction activities. BY encouraging the SME sector Doha Bank was able to set aim of
active participation in Qatar's diversification story. In today’s highly competitive
environment, excellent customer service and speed of delivery plays a vital role in the
succession of any Bank. Our main problem start from here Doha Bank’s is not providing the
required speed of delivery. It’s facing delays in Turnaround Time of SME Lending
processing model. Such delays resulted in losing new and existing highly potential
customers, increasing customer complaints, negative impact on Bank’s image, and loss of
interest/commission income and reduction of lending portfolio, down fall of bank’s
profitability in SME lending.
The overall study aims at realizing Doha Bank’s financial sector challenges and
lending structural laxities, restricting financing interest to this detected profitable market
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sector. The findings expose that Doha bank SME model of lending to be revived to overcome
identified Delays in Turnaround time period. Finally, Recommendations are to be given to
revive the financing structure of the bank, to profitably serve the SMEs at mass for
aggressive perception whilst adequately mitigating credit risk attached to lending. It includes
implementing streamlining and simplifying the credit screening process, internal MIS
capabilities and strategizing the lending approach to effectively capture the significant un-
tapped SME market.
1.2 Project
The management field project undertakes to provide recommendations to reduce or
minimize the turnaround time delays of small and medium lending process of Doha bank.
This project mainly focusing on to the reasons behind the delays in Turnaround Time of
SME Lending processes in other wards issues in bank’s SME lending operational model. The
prime objectives will be to establish suitable SME lending operational model which will
meet the current market requirement of speed of delivery. In addition to introducing a SME
lending operational model, the project will also concentrate on identifying constrains of
Bank’s policy & procedures. Necessary recommendation to be made to amend the bank
policy & procedures in order meet the current market requirements complying within bank’s
compliance framework. Further in order to address the customer complaints issues against
SME lending, employees productivity to be reassessed. A bench mark on expected standard
of productivity will be created and evaluate, monitor continuously. Time Management or
Analyzing the time GAP in SME lending process is also one of key aspect of this project.
This will help in identifying exact steps and its time delays in SME lending process map.
Such information is vital for when creating a suitable SME lending operational model.
1.3 Significance of the study
The importance of this study is reducing turnaround time and increase productivity
without negatively impacting processes. Implementing new process and technology practices
will thereby be increasing productivity and capacity. Due to the Turnaround Time Delays in
SME Lending processes the bank has suffered huge direct and indirect losses in terms of
reputation, customer complaints, losing potential customers, negative lending growth and
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