The HSBC Group is considered to be one of the largest fiscal and banking services organisations in the planetary market. The Group ‘s international web has about 7,500 offices in 87 states and districts in Asia-Pacific Region, Europe, the Americas, the Middle East and Africa and provides a comprehensive scope of fiscal services to over 100 million clients through four client groups and planetary concerns: Personal Financial Services ( including consumer finance ) ; Commercial Banking ; Global Banking and Markets ; and Private Banking. With over 146 old ages of successful history, HSBC is regarded as a fiscal Group of acknowledged position and experience and this is the ground why it has repeatedly been recognized and cited as the top planetary banking trade name by The Banker magazine and the company Brand Finance ( HSBC ) .
HSBC Bank plc Greece ( HSBCG ) was founded in 1981 and is presently one of the most successful key participants in the Grecian fiscal market. Using its valuable international experience and high quality expertness to the particular demands of the Grecian market, HSBCG offers banking services to persons every bit good as to corporate and institutional clients, steering them towards the best available chances.
This assignment aims at supplying a critical strategic analysis of HSBCG – writer ‘s former employer – and showing an rating of the cardinal schemes that the organisation is prosecuting. Furthermore, this assignment aims at placing the actions that HSBCG needs to take in order to turn to the major issues and concerns raised in the present study, based on the broad scope of constructs and thoughts contained in the Strategic Management II faculty.
Section 1: Understanding and Expressing Context
Figure 1: Elementss of HSBCG ‘s strategic context
Menace of New Entrants
Substitute merchandises & A ; services
Customers & A ; clients
Beginning: Writer ‘s creative activity
Strategic context analysis is an effectual method for analysing the environment in which an organisation operates. Environmental scanning chiefly examines the macro environment of an organisation ; nevertheless, context analysis considers the full environment, both the internal and external environment in which the organisation operates. Analysis of the strategic context is fundamentally a procedure of assemblage, analysing, and supplying information for strategic intents. It concerns the monitoring of cardinal macro-environmental forces ( political, economic, socio-cultural technological ) and important micro-environmental factors ( clients, rivals, external spouses, replacement merchandises and services, new entrants ) that affect the organisation ‘s ability to implement its schemes and, therefore, earn net incomes.
Figure 1 presents the elements that constitute HSBCG ‘s strategic context, an analysis of which is traveling to be provided below:
Table 1: Environmental scanning ( PEST Analysis )
Political Forces: Greece is presently in the thick of a harrowing crisis and a deep economic depression. The state finds itself contending to last against bankruptcy over surging shortages ( 14 % of GDP ) , astronomical debt ( 130 % of GDP ) and a fall ining productive sector. The wrath of Grecian people is directed against the opinion system itself as the economic and fiscal crisis has eventually brought to the surface all the perversions and malformations of a political civilization that thrives on transplant and corruptness, thanks to the being of a paternalistic province where kickbacks constitute everyday pattern for the proviso of public services ( Polychroniou, 2010 ) .
Economic Forces: After a long period with high rates of growing, the Grecian economic system is presently in contraction. As a consequence, rough asceticism steps of pay cuts, pension decreases and crisp revenue enhancement hikings were introduced, further dejecting disbursement and taking to terrible occupation losingss, an economic system that is already confronting dual digit unemployment rates ( Polychroniou, 2010 ) .
Social Forces: Greece by now ranks among the most unequal societies in the universe, with around 20 % of its population life below the degree of poorness, and its societal services resemble those of an under-developed instead than those of a developed state. The rough asceticism steps introduced for confronting up the durable structural jobs of the Grecian economic system are already aching workers, pensionaries and the hapless and leveling an already unequal public assistance system.
Technological Forces: Information Technology ( IT ) is a sector where Greece can non claim to hold been a front smuggler. Infrastructure and cognition related to IT were wholly unequal a few old ages ago. The human capital was ever present, but deficiency of an organized IT sector prohibited the employment of such forces within the state. However, one can non pretermit the fact that a tendency of significance has appeared in the last few old ages: Greece is developing its IT sector at a far faster rate than Western Europe, rapidly nearing the most advanced states. Not merely is infrastructure bettering, but usage of IT becomes even more widespread, doing a positive impact on the wider society ( Perez & A ; Koutsoukos, 2001 ) .
Figure 2: Porter ‘s 5 Forces Framework
Menace OF NEW ENTRANTS ( Low )
Entry/exit barriers ( high )
Learning curve ( high )
Capital demands ( high )
Fixed and operating costs ( high )
DEGREE OF RIVALRY
( high )
Market concentration ( high )
Stiff competition ( high )
Number of establishments ( high )
Market adulthood ( high )
POWER ( low )
No important providers in the banking market
Customers ‘ POWER ( high )
Switch overing costs ( low )
Changing client demands
Price sensitiveness ( high )
Menace OF SUBSTITUTES ( high )
Price sensitiveness ( high )
Switch overing costs ( low )
Beginning: Writer ‘s creative activity
SWOT for HSBCG
Figure 3: Swot Analysis
Sound fiscal public presentation
Prudent recognition policy
Exceeding resources and capablenesss
Member of one of the biggest fiscal organisations globally
Exposure to planetary instabilities
Advanced distribution channels
Upgrading of procedures
Amalgamations and acquisitions
Current economic recession
Competition by large Grecian Bankss
Political state of affairs
Beginning: Writer ‘s creative activity
Section 2: Eliciting and Evaluating Strategy
Designation and description of HSBCG Key Strategies
In an environment of utmost uncertainness every bit good as non-linear and unpredictable alteration, scheme development is important for banking establishments, as it enables them to firmly put a clear way by specifying consistent and long-run ends, provides a profound apprehension of the competitory environment and gives an nonsubjective assessment of their resources ( Grant R. M. , 2005 ) . A cardinal organisational scheme demands to put way, concentrate attempt and supply consistence, but at the same clip, it needs to guarantee organizational flexibleness.
Though banking establishments are confronted with instead similar challenges and alterations, their responses vary significantly. This is due to possible fluctuations in their strategic orientation, which derive from divergent organizational constructions of single Bankss and dissimilar features of national markets. The corporate administration and capitalization of Bankss play an of import function in the choice of an appropriate banking scheme. Country specific factors comprise client penchants, the grade of competition and formal legal models, among other things ( Groeneveld & A ; Wagemakers, 2004 ) .
HSBCG cardinal schemes aim at set uping its image as one of the safest and best managed fiscal services organisations in the Grecian market, and at accomplishing a sustainable concern development over the long term. The Bank ‘s sustainable development scheme defines its operational focal point, and sets strategic operational and institutional ends that open new waies for HSBCG to exert its comparative strengths within the specific kineticss of the Grecian economic context.
HSBCG pursues its strategic docket and strives to do the greatest positive impact on the part ‘s challenges by puting accent on the undermentioned distinct but complementary actions:
Leverage and integrating of bing strengths and betterment of failings.
Development of a customer-centric civilization, giving excess attention to the clients.
Development of an invention model for the design and bringing of merchandises and services.
Adoption of prudent investing patterns.
Enhancement of internal and external efficiency by wise usage of engineering.
Improvement of operational efficiency through smarter procedures and controls.
Increased accent on stakeholders ‘ involvement and statutory conformity.
Contribution to wider society by moving responsibly and recognizing environmentally sustainable growing.
Tight control over operating costs and rationalisation of operations.
HSBCG recognizes that the most punctilious scheme program can still derail without the counsel of nucleus values ( Lemanski, 2011 ) ; therefore, the Bank ‘s nucleus values have a cardinal function in its scheme, and the clear communicating of them to clients, stockholders and employees isA considered to be an indispensable portion of HSBCG ‘s scheme program. These values put an accent on:
durable client relationships
responsible and sensitive direction of all concern activities
a shared sense of aspiration that leads to excellence
being planetary in mentality and character
creativeness, invention and customer-centric selling
HSBCG ‘s growing scheme is aligned with the Group ‘s worldwide scheme that focuses on its four client groups: Personal Financial Services ; Commercial Banking ; Corporate, Investment Banking and Markets ; and Private Banking. As a bank with international range, HSBCG besides values diverseness and its scheme is based on the premiss that people of different cultural backgrounds and civilizations can lend to its success.
Execution of cardinal schemes and possible barriers
The ability of an organisation to implement schemes successfully is of paramount importance. This portion of the assignment focuses on the scheme execution procedure of HSBCG, placing possible barriers that have still to be overcome.
Against a background of inauspicious economic conditions, HSBCG manages to react to the challenges it faces and accordingly implement its scheme of sustainable concern development. In successfully put to deathing HSBCG ‘s cardinal schemes, some factors play a decisive function ( Ott, KZatz, & A ; Thomas ) :
HSBCG ‘s organisational construction: Being quite functional and consistent with the Bank ‘s strategic way
Its top direction: measuring the outstanding environmental variables, their relationship to the organisation, and the rightness of the organisation ‘s response to these variables ; determining the sensed relationships among organisation constituents ; planing the organisational construction and commanding the organisation ‘s wages and inducement systems
the Bank ‘s human resources that represent its most of import plus: being extremely skilled and diverse with international experience and cognition, finding HSBCG ‘s ability to run into clients ‘ ever-increasing demands
the prudent usage of advanced information and communicating engineerings
the acceptance of a scheme of uninterrupted organisational acquisition
its organisational civilization deducing from its long history and international background: being influenced by the values, actions and, beliefs of persons at all degrees of the organisation
effectual communicating and function lucidity
Harmonizing to a Harvard Business School professor and a senior organisational chap at McKinsey & A ; Co, possible barriers to successful scheme execution and organisational acquisition could be the undermentioned ( Beer & A ; Eisenstat, 2000 ) :
A top-down senior direction manner: Unless this barrier transforms into a capableness, none of the farther barriers can be turned into capablenesss
Ill-defined scheme and conflicting precedences
An uneffective and inefficient senior squad
hapless perpendicular communicating
hapless coordination across maps, concerns, or boundary lines
unequal down-the-line leading accomplishments and development
Harmonizing to Beer & A ; Eisenstat ( 2000 ) , the first three barriers together undermine an organisation ‘s quality of way ; a deficiency of perpendicular communicating interacts with the other barriers to barricade quality of acquisition ; and the last two barriers cause hapless quality of execution. However these barriers do non presently represent a menace for the Bank ‘s cardinal schemes as it excels in all the said countries. The lone important barrier is the macro-economic instability, uncertainness, and general crisis in the Grecian market that leads to the contraction of the domestic economic system and creates inauspicious long-run effects for the wider banking industry.
To be more effectual in accomplishing its key schemes, HSBCG proctors and evaluates its work in a mensurable manner, taking appropriate actions when necessary based on consequences. The Bank efficaciously monitors its institutional public presentation through the development of consequences models, which include public presentation indexs and quantified marks, in its chief corporate coverage and planning paperss. This consequences framework successfully paths advancement in long term collective development outcomes, every bit good as in specific activities and end products in relation to accomplishing HSBCG ‘s strategic precedences.
Strategic measuring significantly contributes in implementing the Bank ‘s strategic program. At HSBG, measures act as operational definitions of the program every bit good as increase the focal point of the scheme, alining the employees around specific issues. By using the specified steps, HSBCG is able to place the critical focal point points for the organisation, and honor their successful accomplishment. When used to steer the organisation, these steps represent a competitory advantage, as they drive alignment and common intent across the organisational boundaries, concentrating everyone ‘s best attempts at the coveted end ( Ott, KZatz, & A ; Thomas ) .
Areas where nucleus competences are utilised
Distinctive or alone capablenesss that can non be imitated or obtained by others are regarded as determiners of a house ‘s success and growing and are considered to be the cardinal footing for the creative activity of a sustainable competitory advantage. Prahalad and Hamel ( 1990 ) name this the construct of nucleus competences. They describe it as the “ … corporate acquisition in an organisation, particularly how to organize diverse production accomplishments and integrate multiple watercourses of engineering… ” ( Prahalad & A ; Hamel, 1990 ) . There are at least three trials that can be used for placing a nucleus competency. A nucleus competency should:
supply possible entree to a broad assortment of markets
do a important part to the end-product benefits, and
be hard for rivals to copy
Barney ( 1991 ) , emphasizes the stopping point relationship between nucleus competences, sustainable competitory advantage and superior public presentation and suggests that “ a house is said to hold a sustainable competitory advantage when it is implementing a value making scheme non at the same time being implemented by any current or possible rivals and when these other houses are unable to double the benefits of this scheme ” .
A nucleus competency of HSBCG which distinguishes it from its rivals in the Grecian market is its alone international lineage and its planetary entree. The valuable experience and high-caliber expertness, gained by HSBC Group throughout its long history, supply HSBCG with the necessary tools and cognition to react successfully to many alterations in the wide fiscal environment. In add-on, the fact that the Group is non merely at the Centre of fiscal developments around the universe, but it really plays an active portion in determining those developments, generates continual betterments in services and installations, supplying the maximal satisfaction for the demands of each single client. Areas in which HSBCG uses these nucleus competences include Business and Corporate Banking and International Services. With its planetary range and expertness, the Bank offers a scope of comprehensive, cross-border merchandises and services and is best placed to assist any concern maximise local and international chances wherever the concern is located. The Bank has a squad of Global Relationship Managers that connect to its web around the universe and liaise with its concern clients, supplying advice and support to do full usage of HSBC Group systems and merchandises.
Another nucleus competency that distinguishes HSBCG from its challengers in the Grecian market is its committedness to invention and the deployment of advanced engineering. Since its constitution, HSBCG has been a taste-maker in the usage of engineering, ever endeavoring to do its systems more sophisticated, to present the best possible service for its clients. As a member of a planetary Group, HSBCG has a considerable advantage in this regard as it is able to remain abreast of the latest technological developments, wherever they occur, and to utilize them in the most effective manner. The fact that HSBC operates a planetary web linked by cutting-edge engineering enables HSBCG to comprehend new demands and demands quicker than its domestic challengers, developing flexible, alternate services and advanced webs such as the “ Express Banking Service ” . This offers the ultimate in modern-day banking services, supplying clients with fast, easy and unafraid minutess 24 hours a twenty-four hours, seven yearss a hebdomad, wherever they are ( HSBCG ) . Even within the Bank ‘s subdivisions, the specially designed Express Banking countries make minutess more comfy and much easier.
HSBCG has built its schemes based on its nucleus competences and has a clear vision of the function these competences should play within the organisation. HSBCG ‘s nucleus competences represent its competitory strengths relative to other organisations in the industry and supply the cardinal footing for the proviso of added value to its clients. Adopting a scheme of organisational acquisition, that is “ a dynamic procedure of creative activity, acquisition and integrating of cognition aimed at the development of resources and capablenesss that contribute to better organisational public presentation ” ( Lopez, Peon, & A ; Ordas, 2005 ) , HSBCG manages to accomplish and prolong existent advantages against the background of unfavourable economic conditions in the market.
Section 3: Strategic commentary
In 2009, after 13 old ages of dynamic and uninterrupted economic growing, Greece was inescapably affected by the tremendous fiscal crisis that prevailed in both Europe and internationally. Two old ages subsequently, the state is in deep economic recession and crisp economic contraction, fighting to avoid bankruptcy. The magnitude of the state of affairs requires the immediate and effectual confrontation of Greek economic system ‘s structural failings and the betterment of the state ‘s international fight. In accomplishing this end, banking establishments runing in the Grecian market have a important function to play.
HSBCG, as a portion of a planetary Group that over its long life has followed and responded successfully to many turbulencies in the international fiscal environment, knows how to accommodate in order to guarantee its successful operation. To cover with the inauspicious economic conditions and the unstable domestic environment, HSBCG needs to redefine its corporate scheme, puting clear and come-at-able strategic operational and institutional ends.
HSBCG needs to better its corporate reactivity, intending that it should happen ways to be even more antiphonal to its clients ‘ demands and ever-changing demands. In add-on, it should redesign its organisational construction to be more flexible, to outdo promote synergisms between different sections within the Group, and to use the experience and best patterns of all units. Under this enterprise, HSBCG ‘s centralised concern and support units, should prosecute in a more active function and get joint duty with the direction squads in each state the Bank operates. HSBCG should besides seek to heighten its already sufficient hazard direction operations and to better the information provided to stockholders by beef uping the function of the CEO.
By trusting on its strong trade name name, its superior organisation and its top-class forces, every bit good as on the long relationships of trust with its clients, and on the conservative hazard underwriting policy it applies, the Bank will be able to prolong its competitory advantages and successfully implement its strategic ends. This makes certain that when the recovery sets in HSBCG will be in a valuable place to restart its dynamic and outward looking growing ( Bank, 2009 ) .