Strategic Management Report: HSBC Holdings Plc Analysis

This report provides a strategic analysis of HSBC Holdings Plc, a British multinational investment bank, focusing on its performance, competitive strengths, and market position. It explores internal strengths such as a strong brand image, financial stability, and skilled workforce, and suggests leveraging these strengths to capture market opportunities, such as emerging markets and diversified product portfolios. The report discusses the value chain and recommends improvements in online banking services to enhance customer experience. Strategic planning tools like the Ansoff matrix and Porter's generic model are applied to formulate strategies for market penetration, product development, and differentiation. An action plan with budget allocation and monitoring practices is proposed to ensure effective implementation. Furthermore, the author reflects on the learning outcomes of the module, highlighting the development of understanding in strategic planning, market analysis, and application of strategic tools, emphasizing its relevance for future career development in business management. The report concludes that strategic management is crucial for sustainable growth and achieving long-term goals.

Strategic Management

Table of Contents
Introduction......................................................................................................................................3
Part A...............................................................................................................................................3
Part A (2)..........................................................................................................................................4
Part C...............................................................................................................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

Introduction
Strategic management is related with strategically and systematically managing business
activities so that the goals and objectives of company can be achieved by dealing with changing
business environment in an efficient manner. Strategic management helps an organisation in
formulating strategies so that competitive advantage can be gained which can help in increasing
its profitability. In the present report HSBC Holdings Plc is taken which is a British
multinational investment bank that offer various banking and financial services to its customers.
In this report the performance of company, its competitive strengths, market position etc. will be
discussed along with formulation of strategic plan so that company can gain a competitive
advantage. Further reflection on online learning activities will be discussed which can help in
career development of the person.
Part A
HSBC is a British multinational investment bank and financial services holding company
and is the 6th largest bank in the world with about 3,900 offices in 65 countries providing various
banking and investment related services. Various internal strengths of HSBC improves its
competitive strength in market like it has a strong brand image in market along with a good
financial position. Also it employs highly skilled workforce which help in bringing innovations
in the products and services of company so that their diverse needs can be effectively fulfilled.
The company also provides diverse portfolio and is present in diverse markets which reduces the
risk of financial issues in HSBC (Ansoff and Ansoff, 2018). In order to strategically grow in
market it is important that HSBC focus on its strengths so that available market opportunities can
be captured which can help in increasing its competitiveness like capturing emerging markets so
that its market share can increase, diversifying its portfolio of product so that changing demands
of customers can be effectively fulfilled etc. The company can focus on providing effective
internet banking services so that customer satisfaction can be increased along with improving
customer experience. It can also increase the portfolio of its products so that a range of demands
of different customers can be effectively met which can help in increasing its customer base in
market (Barbosa, Castañeda-Ayarza and Ferreira, 2020).
HSBC has 7.5% market share of gross lending in UK market. It is also the largest bank in
UK with total assets of US$2.715 trillion in 2020. With the help of improving its online banking

services the company can further increase its competitiveness in market along with improving
the ability of company in meeting diverse requirements of its customers. It will also help the
company in increasing the customer base of company so that its lending ability can increase
Value chain is related with all the activities which are performed by a business so that
desired products and services can be provided to their customers. It is important that HSBC
identifies all the steps in its value chain which can help it in identifying the areas where
improvements can be made so that it can gain a competitive edge in market and provide high
quality products or services to their customers (Barros, Hernangómez and Martin-Cruz, 2016).
This can help in improving the supply chain management of company so that high customer
experience can be created. In order to effectively provide desired products or services to its
customers, HSBC can improve its online banking services so that fast services can be made
available to its customers throughout the year 24/7 days which will improve customer experience
and can also help them in accessing to bank services as per their convenience.
Part A (2)
In order to gain a competitive advantage in market it is important that HSBC strategically
implement its plan by using appropriate tools and techniques. HSBC can improve its online
services with the help of a strategic plan so that its competitiveness can increase. Strategic plan
must be formulated in HSBC so that efficient implementation of plan can be done:
Mission: To provide products, services and financial solutions to customers at highest
quality which can help in delivering high quality to customers so that high loyalty of customers
can be gained.
Vision: To become world's great specialist banking groups by committing to their core
principles and philosophies so that their goals and objectives can be achieved (Bell and Hitt,
2018).
Strategic Objectives:
 To improve the online services of company so that customer satisfaction can be increased
by 20% by the end of next two years.
 To increase the customer base of company by 15% in 1 year.

Strategies that can be used:
1) Ansoff matrix:
In order to efficiently grow in the market HSBC can make use of Ansoff growth matrix so as to
determine the way in which it can grow in market: Market penetration: In this strategy existing products or services of the company are
offered in the existing market by decreasing the prices, increasing promotion, acquisition
of rival etc. This can help the company in increasing its market share and reaching to a
large number of customers so that its sales can increase. It is the least risky growth
strategy which can help HSBC in increasing its market share and its growth in market. By
providing loans at low rates, HSBC can reach to a large number of customers in the
market (Ferreira, Fernandes and Ratten, 2016). Market development: In this strategy existing products or services are offered in new
markets so that more number of customers can be reached in different markets. This help
the company in gaining economies of scale by reaching in diverse markets along with
increasing the globalisation of company so that a global brand image can be created in
market. HSBC can enter into emerging markets so as to increase its market reach which
can help it in increasing its profitability. Product development: In this strategy a company offer new products or services in
existing market which help the company in reaching to a new customer base in market so
that it can grow strategically. This can be done by company through research and
development, joint development with other company under its own brand etc. HSBC can
use this strategy by improving its products like making improvement in online banking
services so that differentiated services can be provided to their customers which can help
in improving customer satisfaction (Hill, 2017).
 Differentiation: Under this strategy a company offer new products or services in new
market. It is the most risky strategy as it involves both product and market development
and also include lot of investment required to enter in new market and develop new
products. This can help the company in gaining a competitive advantage in market by
addressing the needs of customers in new market by offering them innovative products.
HSBC can use this strategy by expanding in emerging market and offering a diverse
portfolio of services along with online banking services.

HSBC can thus make use of any of the above strategies so that it can increase its
customer base and increase its market reach by providing highly competitive products or services
to their customers (Hitt and Duane Ireland, 2017). HSBC can make use of product differentiation
by improving its online banking services so that its customers can be satisfied through efficient
services which can help also help in increasing customer base of HSBC.
2) Porter' generic model:
In order to gain a competitive advantage in market use of Porter's Generic model can be
done which can help the company in deciding the approach which it can use in approaching its
target market. Following are the strategies which can help HSBC in reaching to its target market: Cost leadership: In this strategy the company produces its products or services at lowest
cost which help it in offering the products or services at lowest price in market so that
customers can be attracted n an efficient manner. This strategy can be used by HSBC by
offering loans at the lowest interest rate which can help it in attracting more number of
customers in comparison to its competitors so high profitability can be achieved by
company (Holloway, 2018). Cost focus: In this strategy company tries to gain a cost advantage in a selected niche
market so that it can become a cost leader in that particular market. This strategy helps a
company in becoming competitive in a particular market so that high profits can be
gained in the market. Differentiation leadership: In this strategy a company target the needs of large market so
that a competitive advantage can be achieved in market by offering highly differentiated
products or services to the customers. With the help of this strategy the changing needs
and wants of customers can be fulfilled by offering them with innovative products or
services so that company can become highly competitive in market (Mavi Gheibdoust
and Mavi 2019).
 Differentiation focus: In this strategy the company tries to focus on the needs of a small
segment of customers so that it can become highly effective in meeting the needs of the
target market segment. This strategy give opportunity to company to offer highly
differentiated products as compared to their competitors in market.
HSBC can use differentiation leadership strategy in its market by improving its online
banking services so that the needs and wants of customers can be met in an effective manner.

This can also improve the way in which customers conduct their banking activities thereby
making the process easy and fast so that high customer experience can be created.
Action Plan:
Budget allocation: In order to effectively implement the strategy chosen by the company
it is important that appropriate budget is allocated to all the activities that will be required
throughout the process (Pozdnyakova and Saveleva, 2017). This will help in improving the
effectiveness of desired results that are to be achieved. In order to implement the strategy of
improving online banking services in HSBC following budget plan can be efficiently used by
company:
Particulars Amount (£)
Marketing 1900
Human resources 9000
Technological advancements 200000
Raw materials 40000
Controlling and monitoring: It is important that effective controlling and monitoring
practices are implemented during the implementation process of strategy so that desired goals
can be achieved. Use of benchmarking or KPI tools can be done so that comparison of actual and
estimated results can be done and efficient improvements can be made during implementation of
strategy.
Part C
While learning about this module I have developed an understanding related with
effective implementation of strategic plan in an organisation and the ways in which strategic
choices are made by a company to achieve its desired goals and objectives. I have also developed
knowledge regarding how business environment is to be analysed so that its competitive position
in market can be determined which is important so that the ways in which market position can be
found. It is important to identify the strengths of a company in market so that these can be used
in acquiring the opportunities available for expansion in market so that its profitability can be
increased. Further, I also developed an understanding regarding application of various tool and
techniques so that effective strategies for company expansion can be found that can help in
strategically expanding in market. This module will thus help in my career development as I can

practically apply my knowledge while working in a business firm in future so that I can suggest
strategic ways to company so that it can grow and expand in market. Also this module has helped
me in becoming highly capable of applying theories and strategies practically so that companies
can apply them and gain a competitive advantage in market.
Conclusion
From the above report it can be said that in order to efficiently grow in market and
remain sustainable so that long term goals can b achieved, strategic management plays an
important role in an organisation. In order to strategically grow it is important that competitive
strengths, position and improvement areas are identified so that a strategic plan can be developed
which can help an organisation in expanding in market.

References
Books and Journals
Ansoff, H.I., Kipley, D., Lewis, A.O., Helm-Stevens, R. and Ansoff, R., 2018. Implanting
strategic management. Springer.
Barbosa, M., Castañeda-Ayarza, J.A. and Ferreira, D.H.L., 2020. Sustainable strategic
management (GES): Sustainability in small business. Journal of Cleaner Production,
p.120880.
Barros, I., Hernangómez, J. and Martin-Cruz, N., 2016. A theoretical model of strategic
management of family firms. A dynamic capabilities approach. Journal of Family
Business Strategy, 7(3), pp.149-159.
Bell, R.G., Filatotchev, I., Krause, R. and Hitt, M., 2018. From the guest editors: Opportunities
and challenges for advancing strategic management education.
Ferreira, J.J.M., Fernandes, C.I. and Ratten, V., 2016. A co-citation bibliometric analysis of
strategic management research. Scientometrics, 109(1), pp.1-32.
Hill, T., 2017. Manufacturing strategy: the strategic management of the manufacturing function.
Macmillan International Higher Education.
Hitt, M. and Duane Ireland, R., 2017. The intersection of entrepreneurship and strategic
management research. The Blackwell handbook of entrepreneurship, pp.45-63.
Holloway, S., 2018. Changing planes: A strategic management perspective on an industry in
transition. Routledge.
Mavi, R.K., Gheibdoust, H., Khanfar, A.A. and Mavi, N.K., 2019. Ranking factors influencing
strategic management of university business incubators with ANP. Management
Decision.
Pozdnyakova, U.A., Popkova, E.G., Kuzlaeva, I.M., Lisova, O.M. and Saveleva, N.A., 2017.
Strategic management of clustering policy during provision of sustainable development.
In Integration and Clustering for Sustainable Economic Growth(pp. 413-421). Springer,
Cham.