International Business: VTB Bank's Strategy, Growth, and Challenges

This report provides a comprehensive overview of VTB Bank's international business operations, highlighting its commercial transactions, market segmentation, and global presence. It examines the bank's operating position in countries like Russia, the United Kingdom, Armenia, and France, and explores the reasons for its recent growth, including technological expansion, globalization, and international monetary growth. The report also delves into the advantages and disadvantages of international business for VTB Bank, its competitive strategy, organizational structure, and key control issues. Furthermore, it discusses entry strategies, supply chain management, human resource management, and the major issues and opportunities faced by the bank, such as competition, regulatory pressure, and sustainability. The conclusion emphasizes VTB Bank's strong operating position and the importance of effective strategy implementation, while recommendations focus on enhancing supply chain management, gaining a competitive edge, and resolving existing challenges.

INTERNATIONAL
BUSINESS ACROSS
BORDERS

INTERNATIONAL BUSINESS
• Commercial transactions
taking place between two or
more countries
• Proper market segmentation
• More potential than the
domestic markets
• Timely and accurate

FEATURES OF INTERNATIONAL
BUSINESS
• Proper integration of the
economies
• Proper competition
• Large scale of operations
• Benefits to the operating
countries
• International restrictions

OVERVIEW OF VTB BANK
• Global provider of various kinds of
financial services
• Comprises of 20 financial institutions
• Global in nature
• Facilitating promotion of Russian
organizations
• Majority of shareholders are Russian
government
• Comprises of 60% voting rights

OPERATING POSITION
• Headquarter in Russia
• United Kingdom, Armenia and
France
• VTB Capital has branches in
Singapore and Dubai
• More than 14 million corporate
clients
• Increasing effectively in other
countries

REASONS FOR RECENT GROWTH IN
INTERNATIONAL BUSINESS
• Proper expansion in the
technologies
• Globalization
• International monetary
growth
• Economic Communities

ADVANTAGES OF INTERNATIONAL
BUSINESS
• Diversification
• Increased quality
along with efficiency
• Proper access to inputs
cheaper in nature
• Effectiveness

DISADVANTAGES OF
INTERNATIONAL BUSINESS
• Increased costs
• Organizational
structure complex in
nature
• Delays in making
payments

COMPETITIVE STRATEGY
• Strengths
Leading banks in Russia
40,000 employees
Comprises of retail as well as
investment businesses
Operates in 20 countries
• Weaknesses
Shallow in nature
Global presence is limited
Growth in market is limited

CONTD….
• Opportunities
Clients are served appropriately
globally
Diversification in the business
Strategic in nature
Return of capital is consistent
• Threats
Fluctuating nature of the market
Increasing administrative costs
Threats from global markets in
Russia

ORGANIZATIONAL STRUCTURE
• Chief executive officer
• Supervisory Board
• Board of management
• Administrative department
• Risk management committee
• Strategy committee
• Internal audit committee
• Card centre
• F & A department

CONTROL ISSUES
• Accounting issues
• Financial issues
• Issues in the financial
position
• Fluctuations in the
exchange rate

ENTRY STRATEGIES
• Exporting (Direct and Indirect)
• Licensing (Agreement and
Patent along with trademark)
• Foreign assembly (Local and
subsidiary)
• Franchising (Usage and
Franchisers to franchisee)
• Turnkey operation (Foreign
buyer and staff of operating
facility)

ENTRY STRATEGY OF VTB
BANK
• Multinational corporation
• International Firm

SUPPLY CHAIN MANAGEMENT OF
VTB BANK
• Functional expertise
• Integrated solutions
• Proper principles of
supply chain
management

CONTROL OF OPERATIONS AT VTB
BANK
• Providing proper
acknowledgement of the task
• Analyzing the different kinds
of managerial risks
• Proper transformation process
to analyze the estimate of costs
• Streamlining processes to
minimize the costs

HUMAN RESOURCE MANAGEMENT
AT VTB BANK
• Proper planning is
essential
• Acquiring right kind
of individuals
• Training and re-
skilling

KEY ISSUES FACED BY VTB
BANK
• Competition
• Regulatory pressure
• Not meeting
expectation of
customers

OPPORTUNITIES OF VTB BANK
• Sustainability
• Proper advancement
in technologies
• Capital demand
• Alternative
competition

CONCLUSION
• Operating position is strong in all
the countries
• Managing human resource
management
• Issues can be resolved
• Proper implementation of
strategies
• Proper growth and globalization

RECOMMENDATIONS
• Implementation of supply
chain management
• Gaining competitive advantage
• Controlling issues of VTB
Bank
• Increase the sales
• Resolving issues with help of
functional expertise

REFERENCES
Vashchekina, I. V. (2015). Social priorities in the work of Russian commercial
banks with public organizations. Mediterranean Journal of Social Sciences, 6(6
S4), 430.
Verbeke, A. (2013). International business strategy. Cambridge University Press.
VTB – World without barriers. (2017). Vtb.com.
Wagner III, J. A., & Hollenbeck, J. R. (2014). Organizational behavior: Securing
competitive advantage. Routledge.
Wilton, N. (2016). An introduction to human resource management. Sage.