Strategic Management Report: OCBC Bank's PEST and Porter's Analysis

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Strategic management
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Table of Contents
EXECUTIVE SUMMARY.............................................................................................................1
OVERVIEW OF THE BANKING INDUSTRY.............................................................................1
PEST analysis of OCBC Bank of Singapore..........................................................................1
Porter’s Competitive Forces analysis of OCBC bank............................................................3
REFERENCES................................................................................................................................5
BIBLOGRAPHY:............................................................................................................................8
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EXECUTIVE SUMMARY
Strategic management is outlined as a process of formulation and execution of schemes and
strategy. Formulation of strategy refers to measuring the situation in which the management
operates. Strategic management refer to the related idea of strategic formulation and strategic
conceptualization of plan. In this report is on the study of OCBC bank, the largest banking
institution in Singapore (Cheng and Humphreys, 2012). The concentration is given on corporate
objectives, external and internal analysis of the financial institution. The target of OCBC bank is
lowering the cost and addressing through online service offerings is the aim of the bank in this
new era. Some of the financial objective of the company is: Sustainability– With uncertainty, OCBC bank is mainly concerned with basic survival.
To fulfil financial objectives of this financial institution uses the marketing technique
retrenching which means keeping the brand vital and keeping profit levels high. This in
turn helps bank during inflation and deflation and keeping the sustainable growth (Cheng
and Humphreys, 2012).
Rise in market share- In financial institution, to enhance their market shares, marketing
plans start with the general strategic business plan. OCBC bank addresses this through
physical, offline and online service offerings. With this they need to research the target
market then identifying rivalry (Mitchell, Shepherd and Sharfman, 2011).
OVERVIEW OF THE BANKING INDUSTRY
PEST analysis of OCBC Bank of Singapore
According to research, thousands of customers of OCBC bank find this bank most
trustworthy. People keep their money in banks cause of different reasons. They are for interest,
easy carrying of plastic money. OCBC bank offers both personal and business banking services
in Singapore and 3 other countries. This banking company trade with the both inbound and
outbound banking business people (Hill, Jones and Schilling, 2014). Political factors Political relation Bank OCBC of Singapore has never been
participating in governmental activities and has never provided aid for political activities.
Whereas, in conformity with its sight and foreign mission to be acknowledged as a Bank
that is far-famed for being protective. Bank OCBC systematically works for social
upbringing for the society in line with the Institution’s Societal Obligation policy that is
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CSR activities. Governmental policies such as increase or decrease in bank rates can
affect OCBC bank. Economical factors- OCBC bank's perspective on the mindset of the banking industry in
Singapore stay comparatively non-fluctuating. This is done in terms of quality growth,
working capital and earnings. This in turn helps the financial institution in having
adequately powerful opposition to the international economic fluctuations. External
factors such as rise in GDP can affect the working of OCBC bank. Social factors- Corporal societal responsibility (CSR) programs undertaken by OCBC
Bank mainly focus on rising the quality of educational activity in Singapore. These
activities are chiefly carried out by adjacent communities to financial institutional
agencies and other areas. Execution of CSR programs yield economic aid, scholarships,
launching of banking activities and exploding children motivation to learn. These
activities are likewise held in collaboration with different social group having broad and
evidenced track record (Mitchell, Shepherd and Sharfman, 2011).
Technological factors- With upcoming of advancement in data technology, globalization
and fiscal activity consolidation united with rising cases and issues, provide OCBC bank
as a complex business. The Data Technology Guidance committee is accredited to
ascertain and monitor the Bank’s IT strategic program (Cheng and Humphreys, 2012).
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Porter’s Competitive Forces analysis of OCBC bank
The five forces analysis are (1) the intensity of rivalry with OCBC bank's competitors,
(2) the threat of new entrant like Tat Lee Bank , (3) the threat of substitute services, (4) the
bargaining power of buyers, and (5) the bargaining power of suppliers. The intensity of rivalry with OCBC bank's competitors – OCBC bank has a competitive
rivalry with DBC bank. The intensity of rivalry rises because they not compete over
physically located banks, they compete online. Online made Investments are expensive
and risky. This means OCBC bank wholly and soulfully depends on digital banking.
OCBC bank being the dominant financial institution and leading in profits. With this
bank making the online banking and mobile application experiences make it superior to
what customers physical going to bank for transferring of cash and for online purchasing
(Hill, Jones and Schilling, 2014).
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The threat of new entrant like Citi Bank- Citi Bank in Singapore is the dominant new
entrant has a highly scale-able cost structure. And in many ways the banking experience
is superior to that of OCBC bank. Customers can compare interest rates and can choose
the best offers that the bank provides. Citi Bank gives tough competition, but it gets
worse because OCBC bank being one of the most trusted financial institution in
Singapore. The threat of substitute services– With Development of e-passage characteristic as
attempt to ease more economical transactions for customers makes it a threat to OCBC
bank. Adaptation to these new services makes it tough for people to understand. For
example: new passbook printing machines. The bargaining power of buyers- Buyers has the coherent motive to compel the suppliers
if purchases from the company represent an important proportion of their total costs.
Buyers will gain low-level margins such as interest and are price sensitive. This happens
to a lot of banking institution and financial agencies like OCBC bank (Mitchell, Shepherd
and Sharfman, 2011).
The bargaining power of suppliers- There is a outstanding demand for global
information and good banking services in the financial institutions. The only supplier
which might exercise power over OCBC bank would be experienced trained personnel,
which is in great demand in the online banking business all over the world. In relation to
other banks, OCBC bank is not importantly subject to the negotiating power of their
suppliers and experience low levels of indirect effort on their drive from other source
(Cheng and Humphreys, 2012).
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REFERENCES
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