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HSBC a largest banking organization in the world has been started his operation since 1865 as it was founded by Scotsman Thomas southerland.Southerland wanted to facilitate the burgeoning trade between Europe, China by offering financing to new establish business. The new company established a branch in Shanghai, then other in Japan before offering public loans in 1974. In today's world HSBC operating its business in the global market towards emerging economy while it has been providing best financial products & services by qualified stuff & technology for the last couple of years. At present HSBC, consist of personnel financial service, commercials banking, global banking, & markets, private banking HSBC finance corporation, card & retail services, etc. The vision of HSBC to lead the financial sector with the three components of business, such as core values, core purpose, & visionary goals. Core values contents excellent customer service etc.HSBC insurance taxpayer, Pioneering technology, creativity,intrigrity & social responsibility. Core purpose to justify market segment & visionary goals focus to target common enemy, role model international transformation.
As HSBC has been planning international working in emerging economy,. So obviously it depend on some factor which are the constraints of strategic planning Of HSBC.
when a company planning internationally then it has to face some factors which are crucial points to implementing strategy. For Example, HSBC bank which is playing role in the international market on which impacts some factors that are the vital matter of company's strategic decision which is explained bellow for our onwards discussion.
'PESTEL' is the environment factors of strategic implementation of our organization. Pestel ellaborates as political, Economical, Social, Technology & environment.
Political factor is one of the great sector in the organization which exits government stability, taxation policy. Foreign trade resolution, social welfare polices etc. for example government change may effects HSBC business strategy.
Economic factors contains of business cycles, GNP trends, internet rates , money supply inflation , unemployment, disposable income ,on our organization. For example, due increasing of unemployment rate, HSBC is facing deposits crisis in the market.
Social factors demonstrates population demographic income distribution, social mobility life style changes attitudes to work & leisure, Consumerism, levels of education . For instances admission of hugs overseas students in U.K. college passport account has been increased as double in HSBC bank this year.
Technology is effecting more & more in HSBC suppose internet banking, Offshore banking, website facilities, electronic banking have been given unique power to HSBC drive in the global marker.
Environment is the key factor for HSBC which consist of environmental protection laws, waste disposal energy consumption etc.
Legal factor affects the organization eventually for examples monopolies legislation employment law, health & safety, products safety.
The above noted factors are constraints of HSBC bank for implementing strategy on its business. Let us to see what would to drive of HSBC to over come these factors:-
Identifying all the attainable long-term objectives.
Prioritizing the long-term objectives.
Evaluation of the internal resources of the organization, including finances marketing expertise, productive capacity, technology & stuff.
Apprising the external environment of the organization within which its operate including the economy environment. , present & possible future government action & legislation.
The need to establish formal monitoring, review & evaluation procedures.
The need to recognize constant updating & modification in pursuit of chosen direction .
The need to ensure that all activates, primary & support, are co-ordinate effectively.
Whereas strengths& weakness emanate chiefly from inside the saying organization opportunities & threats are usually external factors of HSBC.
Some example of opportunities are a new financial markets opening up in U.K that could be filled from existing resources, the opportunity to take over another company which would improve the organization capabilities of the opportunities to take the management team an expert in some appropriate fields who would improve the organization performance.
For example, hiring new CEO& CFS or managing directors for HSBC who would improve the organization performance.
Threats for HSBC are changing technology, thrusting competition for example of arrival of new companies , new products, new services especially from overseas economic & political uncertainly etc company could face this factor by analyzing, Market analysis competitor analysis & talking drive accordingly.
Porter's diamond model is the tool of strategy which helps organization to identify its threats on the market on learn to take initiative to survive on the market accordingly porter's diamond model is also called five forces analysis.
According to M.E porter, competitive strategy free press, 1980 it has shown bellow.
Bargaining Threats new entrances inauguration
Power of new bank example-Halifaxe.
Suppose HSBC Bargaining power of buyer eg
Depositors talking more advantage from
Who will natwest,braclays,etc.
Compare interest Threat of substitute
Rate on other bank
In strategy analysis , its seem important to be able to figure out what ones rival is going to do , that is to anticipate arrival moves which is called game theory. For driving of strategy is important of game theory for HSBC bank. Is essential in all aspects. Because game theory show the way to company how can it do.
Some example of game theory are -
2) Advertising ways.
Steps must consider to game theory to given below:-
1)Identifying the players .example Braclays bank.
2)Identifying to strategic choices .
3) To specific the role of the game.
Our practical of game theory of saying organization is given bellow.
The Pay offs.
For example of HSBC and Barclayes of both bank are not running an ad campaign result in them sharing the market and marketing sales 5 billions pound.
If one of them runs an advertising campaign and the other doesn't the makes sales of 8 billon pound( 80% 10 billion).
But has to pay advertising costs of 2.5 billion pounds living net sales 5.5 billion pounds.
The game in matrix from given under as discussion .
Advertising War figure in billion
No add Add
The strategic saving deposit & current deposit are facing is what game theorist call prisoner's dilemma. Overall profit would be higher if both the bank (HSBC & Bracleys) did not advertise but both have an individual incentive to go ahead and advertise any way regardless of what the other player does (ad or not ad).
This makes advertising a dominates strategy - a strategy that does better them all others for any strategy chosen by the other players. This gives us the first way of predicting our rivals behavior.
To sum up, it has been viewed to us that strategy is the key part of organization by which an organization could achieve a long term goals but there are some internal & external factors which may interrupt its policy. So , considering the matter we think that HSBC may take some initiative as we discussed this topic elaborately to overcome this change & serving in global emerging economy.
Strategic management is concerned with the formulation & implementation of strategy within organization. But proper strategy discussion making process is considered to some environmental issues such as external & internal issues. For examples HSBC bank is concerned some internal issues I.e. Strength & weakness strength means bank quality & weakness means lack of upgrading salary & incentive employees training, R & D etc. On the other hand external issue demonstrates opportunities & threats. Opportunities imply hiring qualified CEO &CFO, innovation of new business of policy etc alternatively, threats express new contents in the markets I.e. Halifax Anibbas etc.Buying power of supplier I.e. Borrowers who could choose low rate of landing products arriving in the markets. So, environment is the vital factor for HSBC bank for implementing & formulating its strategic decision. Let us analysis the given matter on the basis of HSBC.
The strategic Planning can make the difference between the success & failure of the organization the strategic planning the process helps guide organization in deciding how to productively manage its relationship with competitors, suppliers , customers, & other environment forces, clear understanding of organization SWOT, mission, goals, & objectives also it is necessary to understand the company's.
Environmental including the company markets, competitive forces and regulatory change. These shorts of analysis could be come to the strategic process for long term prospect of caption organization. The matters which relate long term process of strategic planning are.
The Changing Business environment.
Analyzing environmental & industry trends.
Developing an information system.
Assessing the business internally.
Implementing the strategic plan.
As a global bank , HSBC is involved in two types of planning: Strategic & operational .The Strategic planning is long term planning with time horizon 3 to 7 years. It is significant and establish the future directions and major course of action. It is there for a major responsibilities of top management. The operation management is tactical planning .The uniqueness & complexity of strategy planning in the global market creates different in the types of decision and multinational corporation I,e HSBC have such as : what countries to expand to & when, when to enter anew market and how , when to introduce new products and when to close up a plant.(Willium, 1984).
Some environmental effects which may interrupt corporate business planning Of HSBC as the globalization of business with increasing activism of business. Stakeholder has mad strategic planning more complex in multinational corporation(MNC). The factor that contribute to this complexity in a global operation include international strategic alliances, coordination & control of international marketing communication, regional trade blocks, European Union, and choice of global strategy.
Global threats for example (global warming) of corporate business planning as due to global warming the economic condition of some countries would be changed. Also other threats of for example making a leap from the fragmented economic & political system of the industrial past to a global order, recognizing various economic interest into a sound global productive economy managing the complexity of the new global economy , achieving sustainable development and closing the gap between the wealth of the southern & northern hemispheres. The elements of master strategy that will over come obstacles are disseminating advance technology to unify the globe, integrating economic and society by reconciling economic various economic interest. Into a sound global productive economy managing the complexity of the new global environment achieving a sustainable environment , achieving a sustainable development and closing the gap between the wealth of southern & northern hemispheres. The elements of a master strategy that will over come this obstacles are dismantling advance technology to unify the glove integrating economic and society life creating a harmonious economic sociality relationship that will from a symbiotic society environmental interfere, developing decentralize institution that will empower
Individual and fostering collaboration alliances.
Environmental is the vital factor in strategic decision making process for example SWOT & PESTEL analysis show the environmental effects on the organization. However, environmental question concern management and these come from any sources.
There is increasing British & EU legislation concerning planning regulation the disposal of waste of effluent & concern for the environment, to which all organization must confirm organization in sector that has extreme effect on the environment -e.g. oil construction the nuclear industry -are required to take ever increasing a long term account of the effect that it activates in the environment, the increasing number of , and influence of pressure group such as green peace also have an effect on strategic decision process.
To conclude it is clearly observed that environment is the burning question for implementing & formulating strategy in the local global organization, HSBC bank should be conscious towards such environmental its long term global goal in the emerging economy.
Sources: 1) URL:http//www.quickmba.com/strategy/vision
References: 1) Craig, James C & Grant , Robert M (1993) Strategic management,
London:Kogan page .
2) Clarke, Gordon(2007) Business Management London : Emerald
3) Eyre E.C & Pettinger, Richard (1982) Mastering Basic Management
Armstrong, Michael & Stphens, Tina(2006) Management &
Leadership, London:Kogan Page
Task 1 03
Task 2 04
Task 3 05
Task 4 06& 07
Task 5 08
Task 6 09
Executive summary & references 10
NORTH LONDON COLLEGE OF BUSINESS STUDIES.
COURSE TITLE: POST GRADUATE DIPLOMA IN
BUSINESS MGT (PGD)
ASSIGNMENT NO: 0
UNIT TITLE: STRATIGIC BUSINESS MANAGEMENT &PLANNING
STUDENTS NAME: MOHAMMAD ABU SUFIAN
STUDENTS ID NO: SUN 9032/09A
SUBMISSION DATE: 27.04.2010
NORTH LONDON COLLEGE OF BUSINESS STUDIES.
To understand strategic business management & planning process of an organization in the globalized world I am given to discuss the profile of Unilever & Oxfam on the basis of following tasks.