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Evaluate the meaning of business strategy along with the background information of the company as well.

Business Strategy

The purpose of this report is to enlighten the reader about the background information of the company Commonwealth bank and its past and future strategies as well. The report evaluates the meaning of business strategy along with the background information of the company as well. It future analyses the current and past strategies of Commonwealth Bank Australia initiated in the market from last 5 years. The critical evaluation of the activities of the company defines the actions taken by the organization that are favourable for the growth or not.  Lastly, the report evaluates the future business strategies that Commonwealth bank should utilize in order to achieve success in the target market. A business strategy refers to a set of decision and actions that are organized in the business process with an aim to help the business succeed in their defined goals developed. The business strategy of an organization is formed by the management that helps them in formulating actions, making decisions, allocating work etc. Commonwealth Bank is an Australian multinational bank that operates its business across UK, New Zealand, the United States and Asia. The Commonwealth Bank is the largest Australian listed organization on Australian Securities Exchange. Further, more details about the report are discussed below:

A business strategy refers to the strategy that helps an organization in reaching specific business objective within time. A strategic plan succeeds because of the business strategy implemented by the organization in the target market. So, it can be said that a business strategy is a working plan of an organization that helps them to achieve its vision, prioritize objectives, compete successfully and optimize the effective financial performance with the business model of the company. An effective business strategy helps the company in gain competitive advantage in the market and sustaining their position as well. Even if a business has well-qualified resource, then also it will not achieve success if it does not have an adequate business strategy (Schlagwein, Thorogood, and Willcocks 2014). Thus, it is very important for companies to make use of an effective business strategy in order to compete and gain their position in the target market. The business strategy formed should value the objectives of the company and align the business model as well. Three basic business strategies present in the environment were proposed by Porter that are cost leadership, differentiation and focus. Under the cost leadership business strategy, the companies focus on reducing the cost of their production. While in differentiation, the companies focus on differentiating the products and services in the market than the competitors. Lastly, the focus strategy emphasizes on a particular niche market and understand the dynamics of that market in order to help the company to focus on one thing and succeed in the target market (Dell'Atti, et. al., 2017).

Commonwealth Bank Australia, commonly known as CBA or CommBank is an Australian multinational bank. The bank provides a variety of financial services to the customers in the market. These services include retail, institutional banking, business and insurance, fund management, broking services, superannuation, and investment. The CommBank is the largest bank present in Southern Hemisphere. The company was founded in the year 1911 by the Australian government and it was fully privatized in the year 1996. Commonwealth Bank is a part of the big four Australian banks along with NAB (National Australian Bank), ANZ and Westpac. The bank was listed on ASX in the year 1991. CBA has headquartered Sydney and has more than 1100 branches and 4300 ATMs in total. The company works with more than 51800 employees worldwide. The bank has been struck with various controversies like data loss of 20 million people, 2008 financial planning scandal etc. (Commbank 2018). The company is working under the leadership of Matt Comyn (CEO and MD). CommBank is Australia’s largest retail bank that offers a wide range of products and services to the customers including credit card, savings account, loans and transaction services (Commbank 2017). The bank has the largest branch and ATM network as well. It also offers various help and services to people who are aiming to move into Australia. The bank provides its internet banking services through NetBank. The NetBank allows the customers to manage their account, transfer funds, and manage to save, saving goals and access assets and liabilities as well. The ban also provides its mobile application to iOS and Android users. CBA has its subsidiaries in Australia that are named as Commulnsure, Colonial First State, Commonwealth Securities and Bankwest. In New Zealand, the subsidiaries are called ASB and in Asia-Pacific, they are called AMTD Group Company Limited (Hong Kong), Colonial National Bank (Fiji) and PT Bank Commonwealth (Indonesia) (Chanthadavong 2014).

Company Background

Before understanding the business strategy of the Commonwealth Bank, it is very important to understand the vision and mission for which the company initiated such strategies in the target market. The vision of the bank is to excel in securing and influencing the financial wellbeing of communities, people and businesses. The company aims to initiate a customer-focused strategy culture and strategies as well. Further, the mission of the Commonwealth Bank is to collaborate, integrate and provide such services to the customers that improve the process of working and satisfies them as well (Bonin 2016). Further, below mentioned are the business strategies used by the company Commonwealth Bank:

The company aims to strategize create long-term values for the customers, shareholders and people. The long-term business strategy of the company aims to fulfil the vision of the organization and excel in the target market as well. The company explains that keeping the interest of customers is their strategic priority. They serve and satisfy the customers so that they can continue to turn at the bank as a choice (John 2018). The company attained total assets of more than $976 billion so that they can provide liquidity and financial stability to the customers. Further, the company also aims to initiate actions so as to provide convenience to the customers and provide various self-service options as well. The company made #1 free financial app to assist the customers with their banking actions. The data shows that there are 30 million logons in a week and 6.2 million active online customers (Weill, and Woerner 2015).

In the year 2017, the company launched a program naming Unlocking Everyday Innovation. This business strategy helped the company to introduce high tech innovation in the business and succeed as well. With the help of this type of strategy, the company faced a dramatic shift in the ways in which business deals in the market. Under this process of innovation, the company analysed various factors affecting innovation and then helped the communities to innovate as well. In this way, the company helped the customers to gain a higher level of satisfaction and succeed in their mission as well. The Commbank helped the businesses to attain a higher level of revenue growth using different aspects of innovation in their business (Commbank 2018). Thus, it can be said that the innovation business strategy helped the company to fulfil their vision and mission as well. The benefits realized to the bank through innovation strategy are market positioning, efficiencies and productivity, competitive advantage, stakeholder engagement and staff engagement as well (Shapiro 2018).

In the past few years, the bank also aimed to undergo various transformations so as to deliver simpler and better bank to the customers. The company believes that their real competitive advantage lays in their strategy to gain leadership in digital banking. With the help of this process, the bank aimed to increase the engagement of customers in the business (Cameron, N 2017). Further, the CEO of the company explained that their aim to simplify the bank included the actions like making the strategic choice, proceeding in future directions, accelerating leadership in Australian and New Zealand's commercial and retail banking business. Under the part of this aim, the company strategized to demerge the wealth management and banking operations in the year 2019. Along with the strategic review of general insurance business Commlnsure (Pash 2018).

Current and Past Business Strategies

The company aims to remove duplication by converting its platform strategy into IT infrastructure strategy. After completing the transformation of core banking infrastructure, CBA aimed to drive platform-based strategy to simplify the current process and eliminate the unrewarded complexities as well. The company created a multi-level platform that they can eliminate other stages and induce all the work in a single one. As the company wants to fulfil the demand of all the customers, resulting in which, they initiated strategies to simplify the process and include all the requirements under one app only (Australian Associated Press 2018).

Thus, it can be said that the above mentioned are the business strategies of the company that were specifically designed to help the organization to complete its goals and objectives. Strategies are one that is specifically designed to fulfil certain objectives of the company. In response to which the organization defined certain goals for which the initiated strategies in the environment (Letts 2017).

Looking at the business strategies implemented by the company Commonwealth Bank it should be noted that the bank worked in an efficient way to attain the objectives in the environment. Throughout the past years, the only objective of the company Commonwealth Bank was to attain success in such a way that they increase the customer engagement in the activities of the company and propose a simpler way for people manage their banking activities. Adding to it, the company also significant initiated business strategies in a way so as to develop the application platform, assist people in organizing activities, delivering services in a better way and focusing on customer satisfaction. These all activities shows that are the company adequately understood the meaning of business strategy and initiated all the functions in a positive way. In response to the business strategy, the CBA also implemented various actions that helped them to succeed in the target market (Farrer 2018). The company organized a Financial Inclusion Action Plan that helped them to strategically attain their objectives in the target market. The program helped in satisfying the interest level of the customers in the market. With the help of this program, CBA increased the economic participation and status in the market, diversity and awareness of cultures and improvement in products and services as well. The company also reinvigorated in sales programs with an aim to increase the satisfaction level of the customers. However, critically reviewing the above-mentioned statements, the fact should be noted that the company lacked in achieving various aspects as well (Commbank 2018).

Privacy of the customers can be seen as one of the major aspects that the company needs to look after in the target market. A recent case has been reviewed that explains that the company has given threat to 20 million application users for privacy breach (Hendy 2018). So, it can be seen that although the programs are becoming efficient the bank is losing its grip on the privacy of the customer. Also, the company is facing the problem of increasing debts in the market that is affecting the ratings of the bank as well. Fitch credit rating agency marked the bank as negative due to which the company faced difficulty in attracting new customers in the market. Thus, it can be seen that although the company is implementing great business strategies still there is a large scope for the bank to succeed in the market. The business strategies can help them to eliminate the earlier issues attracted with the company (Klettner, Clarke, and Boersma 2014).

Looking at the scandalous events, it can be seen that the company Commonwealth Bank is facing severe problems in managing the privacy of customers of the company. One of the current issues also attracted the company in fake banking app scam. So, the company should initiate customer privacy protection business strategies in the environment (Sia, Soh, and Weill 2016). The strategies should provide a confirmation to the customers using the baking application of Commonwealth Bank that they should aim to not leak any price sensitive information of the company. The company should also fix the application along with the internal structure of the company. If there is a fault in the business activities then it can be clearly seen that the management is lacking behind somewhere (Commbank 2018). So, the organization should implement a strategy that keeps the personal information of the client restricted. This is the first and the foremost business strategy that the company is initiated in the market. It can be seen that privacy is one of the most important aspects that a customer requires from the organization and they cannot levy this requirement anyhow. So, if the bank will also take care of the interest of the customers and their privacy then the company will not fail in satisfying the expectation of the customers (Reynolds, and Yetton 2015).

One of the recent news also stated that the company is facing a system failure problem that is increasing the dissatisfaction level of the customers in the market. In the past business strategies of the company, it was known that the company is aiming to set up more smart ATMs around the city but what if these ATMs are no working efficiently in the environment. Setting up the new plant is a waste of use if the earlier plants are not working efficiently and delivering services to the customers. So, before planning to set up a new plant, the company to organize the business strategy to rectify the coding error and other several issues attracted with the systems of the company. System failure can also be looked like one of the major reason due to which the company is a privacy issue with the customers in the current environment (Charles, Schmidheiny, and Watts 2017).

As the company is attaining negative ratings in the current environment so they should also initiate the business strategy that detracts penalties and attract profits in the current environment. Profits for an organization can be attained only if the management is working effectively for the purpose of helping the customers of the company. However, the company is somehow lacking in attaining such objectives in the market. The company is formulating an ERP system that should assist all the internal actions of the company. Although the company is already working with an effective ERP system in the market but somehow the services are not effectively delivered to the customers. So, the company should modernize the ERP system that should effectively organize the activities of the company (Yip, and Bocken 2018). The ERP system should offer various services to the employees of the company. The most important aspect that the company should look after in this case is that the management should ask the IT team to modernize the ERP system in such a way that the system is protected from hackers. With the help of this process, the bank will organize various strategies that will initiate the internal as well as the external process of the company. 

Transparency can be seen as one of the most important aspects for the stakeholders of the company. So, it should be noted that in order to comply with the goals and vision of the Commonwealth Bank, the management is to initiate transparency and ethical activities in the environment. This will increase the stakeholder engagement in the organization help the company to increase their market image as well (Bughin, and Van Zeebroeck 2017).


Thus, in the limelight of the above-mentioned events, the fact should be noted that the above-mentioned report evaluated the actions of the company Commonwealth Bank. Commonwealth Bank is a part of Australian Big Four Banks. The report evaluated that the company performed various good deeds in the environment in the past 5 years. However, they faced failure in various aspects as well. Considering all the activities initiated by the company, their objectives and drawbacks, few recommendations for next years are defined in the report. The company should follow these business strategies in order to attain customer satisfaction in the market that is the primary aim of the company. The above-mentioned report also evaluated a critical review of the activities of the company that helped in analysing the aspects where the company is lacking behind. The report adequately complies with the requirements of the assessment.


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Bonin, JP, 2016, From reputation amidst uncertainty to commitment under stress: More than a decade of foreign-owned banking in transition economies. In Global Banking Crises and Emerging Markets (pp. 22-51). Palgrave Macmillan, London.

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Cameron, N 2017, CBA's Vittoria Shortt: Marketing needs to stay focused on long-term customer truths,

Chanthadavong, A 2014, Commonwealth Bank to roll out simplified platform strategy

Charles Jr, OH, Schmidheiny, S, & Watts, P 2017, Walking the talk: The business case for sustainable development. UK: Routledge.

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Klettner, A, Clarke, T. & Boersma, M 2014, The governance of corporate sustainability: Empirical insights into the development, leadership and implementation of responsible business strategy. Journal of Business Ethics, vol. 122, no. 1, pp.145-165.

Letts, S 2017, Commonwealth Bank's ongoing systemic failures: But wait there's more,>

Pash, C 2018, In one slide, here's Matt Comyn's strategy for the Commonwealth Bank,

Reynolds, P, & Yetton, P 2015, Aligning business and IT strategies in multi-business organizations. Journal of Information Technology, vol. 30, no. 2, pp.101-118.

Schlagwein, D, Thorogood, A, & Willcocks, LP 2014, How Commonwealth Bank of Australia Gained Benefits Using a Standards-Based, Multi-Provider Cloud Model. MIS Quarterly Executive, vol. 13, no. 4.

Shapiro, J 2018, APRA report takes toll on Commonwealth Bank executives past and present,

Sia, SK, Soh, C, & Weill, P 2016 How DBS Bank Pursued a Digital Business Strategy. MIS Quarterly Executive, vol. 15, no. 2.

Weill, P, & Woerner, SL 2015, Optimizing your digital business model. MIT Sloan Management Review, vol. 43, no. 1, pp.123-131.

Yip, AW, & Bocken, NM 2018, Sustainable business model archetypes for the banking industry. Journal of Cleaner Production, vol. 174, pp.150-169.

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