The problem ANZ is facing is that the business is neglecting its domestic customer loans, in order to fund their expansion into international markets. Therefore, it is evident that ANZ's main concern is developing strategies that result in an increase in finances that can be directed towards satisfying its domestic customers, without hindering its expansion overseas.
One financial strategy ANZ could implement would be 'two-point arbitrage,' also known as 'geographic arbitrage.' This involves profiting from differences in the price of a currency between different markets. This is a riskless activity involving simultaneously buying a currency in the lower-priced market and re-selling it in a higher-priced market (Mahoney, Trigg, Griffin & Putsay 2001).
This could be done as the impact on overseas economies was more severe than in the local economy during the global financial crisis. Australian companies were protected by the governments' fiscal and monetary stimulus, thus benefiting ANZ. The increase in profits will allow ANZ to fund its domestic customer's growing demands (McMurray, Lai & Wei 2009).
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Since costs were up 11% year-on-year, ANZ may also arrange 'management contracts' within smaller countries (McMurray, Lai & Wei 2009). Management contracts involve a firm in one country agreeing to operate its facilities to a firm in another country for a fee. Therefore, ANZ would not own the branch bearing its brand name in that country, rather operating it under management contracts. This results in less expenditure and also allows managers to focus more on their domestic consumers as well as continuing to provide a good service to its overseas consumers (Fisher, Hugehs, Griffin & Putsay 2006).
ANZ needs to ensure they collect all bad debts still outstanding. This can be done through 'hedging,' where debts are transferred to an outside financial institution for a fee (LowTax 2011). This results in immediate cash inflows. Extra financial capital can also be generated from the Australian Stock exchange (Tutor2u 2011).
Each strategy could benefit ANZ in adequately maintaining its focus on both of its domestic and international markets equally, and maintaining its reputation built on customer service.
Through operation in multiple overseas markets, ANZ will encounter a number of barriers concerning the development of its brand in these new cultural environments. ANZ must be aware that success achieved in one environment will not necessarily be achieved in another, and therefore needs detailed knowledge of the market and its consumers to establish its brand name and loyalty effectively. Successful, well-known brands attract and retain customers which prove easier to increase wealth. However, if smaller, underdeveloped countries are unfamiliar with the ANZ brand, it poses as a barrier for them to effortlessly enter new markets and assume the brand will succeed (Chung, M & Smith, W 2007).
ANZ cannot rely solely on their marketing strategy to guide all of their operations, because when marketing strategies are not well developed and supported with appropriate research, investments in Asia and other countries will not be effective (Fisher, Hugehs, Griffin & Putsay 2006). In order to overcome this barrier, ANZ needs to invest in extensive research and development of strategies to implement in all its overseas markets to ensure integration is successfully executed, and to maintain competitiveness (Chung, M & Smith, W 2007).
Another barrier for ANZ is that in many countries, foreign brands entering their markets pose as a threat and many consumers are reluctant to invest in companies that are taking business away from local companies and as a result reducing profits in the local economy. Again, ANZ must have strategic marketing plans that will create the required positive brand imagine in the minds of consumers as quickly as possible. Research suggests that Asian consumers especially, are significantly less loyal towards brands then Australian consumers, which increases ANZ's needs to provide high-quality services in these types of cultural environments (Chung, M & Smith, W 2007).
In order to overcome these barriers, ANZ not only needs to effectively establish its brand name but also brand sustainability. This requires a consistent, systematic strategic approach, and management support for this is integral to ensure its success (Chung, M & Smith, W 2007).
The centralised management approach refers to top managers who make key organisational decisions with little or no input from subordinates. In contrast, decentralised management approach refers to top managers who consolidate power and decision-making abilities with subordinates (Knowledge Management Systems 2011).
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The management theory that would be best recommended for ANZ would be the decentralised theory. Since ANZ operates in 25 other nations, and therefore encounters vast ranges of cultures, management needs to communicate effectively within its organization. By allowing employees to have an input into decisions helps management make more informed and educated decisions that will reap the greatest benefits (Knowledge Management Systems 2011). This is a much better outcome than managers neglecting subordinates and making decisions based solely on their own perspective of the organization and the people in it.
Within a decentralised organization, Managers can take advantage of division of labour by sharing decision-making powers across the company. Employees are more motivated as they feel acknowledged and a valuable asset to the company. Also as a result, worker productivity increases, because the empowerment allows them resolve problems within their activities efficiently and effectively, without having to seek approval from top management (SpringerLink 2011).
This also results in a more enjoyable work environment, and employees are more caring of the company and therefore are more competitive and innovative as they are want the organization to do well. This is essential for ANZ's effective integration within the Asian market (Knowledge Management Systems 2011).
Therefore, decentralised management is highly recommended for ANZ as it is the best way to achieve a thriving work place environment that is essential for maintaining its competitiveness. Consequently the organisation will uphold its place among the top 50 banks in the world and strive towards becoming a super regional bank.