Mission, vision and competitive advantage of the company
Discuss about the Management System for Corporate Strategies of NAB.
The project aims to focus on the management system of the chosen company NAB. The strategies of the company are discussed in the project that includes the mission, vision and the competitive advantage of the over the competitive market in which it operates. The various strategies that has been criticised are highlighted in the project. Furthermore, the environmental analysis of the NAB is performed with the help of the PESTEL analysis, SWOT analysis, internal and the specific environment analysis. The leadership style and its impact have been discussed in details in order to understand the topic in details.Discussion on how and why are the strategies applied in the company
NAB is the National Australia Bank in Australia that aims to help its potential customers with their money. NAB operates in more than 800 locations in Australia, New Zealand and all over the globe. NAB being one of the largest bank for business in Australia, works with the small, large as well as the medium business in order to support them in growth and development of the business. Moreover, the organisation provides funds to the essential infrastructures of the area such as the schools, construction of roads and hospitals. The main motive of the company is to carry out its responsibilities in an innovative, responsible manner that helps to create customer satisfaction and thereby drawing more customers towards the company (nab.com.au 2016).
The competitive advantage of the companies helps them to sustain in the competitive market by achieving advantage on its products, goods, services and strategies over its competitors. The competitive advantage of the company supports the organisation to attract the potential customers that is important to increase sales and profit of the company.
NAB has been converting the loyalty of its staff in order to gain competitive advantage over its rival companies. In the opinion of Obiozo and Smallwood (2014), commitment and loyalty of the staff and the team within NAB is one of the reason behind the success of the company in the process of sustaining in the market.
Like every organisation, NAB has been using several corporate strategies that supported the growth and the development of the business. The company uses its corporate strategies in order to provide a positive impact on the customers and the environment on which it operates. NAB had used various strategies in order to achieve its organisational goals and objectives. The strategy of the company supported the societies, which are more social and financially strong, delivered efficient programs. The company tried to provide goods and services that made the management of the environmental risk easier for the customers. The strategies even helped the customers to effectively use the new market opportunities in order to grow and develop.
Past strategies used by the company
NAB developed current strategies that helped the company to overcome its loopholes. The stakeholder engagement process of the company is improved to obtain efficient corporate strategies for the organisation. The company has been recently more concerned in strengthening the relationship with its stakeholders that is useful in analysing the environmental, government and the social issues. The corporate strategy of NAB helps the management to set objectives, policies and measuring procedures for the company. The CR management and the reporting into the government structure have been adopted by the organisation to ensure the corporative responsibilities (Gelens, et al. 2014).Discussion on strategies that were criticised
Jensen et al. (2014) mentioned that it is important to consider the appropriate corporate strategies for the organisation that can help the company to fulfil its goals and objectives. However, NAB has applied a number of strategies that has been criticised for failing to achieve its goals. In 2000, the company undertook a strategy in which it disposed of the MNC to the ABN-AMRO at US$2 billion. NAB had failed to understand the complex features present in the mortgage market of US. Thus, the company suffered from a loss of over US$2 billion that has adversely affected the company. The strategy adopted by the company on order to make a small gain has been therefore criticised as a loss making strategy for the NAB.
On the other hand, NAB had incorporated other strategies within the company that has been criticised as the bank has failed to reach its goal of being the leading financial service company in the world. The company had focused on the targets for the contribution of the earnings, while Bourne (2016) had argued that the company needs to concentrate on the back to basic approach of Australia and New Zealand in order become a successful financial service company. According to financial services inquiry (FSI) the bank can ensure survival in the volatile situation only if they are unquestionably strong.
The inappropriate decisions and the inefficient strategies of the company has been a major cause behind the loss in the financial position of NAB. The company witnessed a downfall in its revenue and profitability that restricted the investors from investing into the business due to the poor financial performance (Johnston and Marshall, 2016). On addition to this, the overseas acquisition of NAB had finished in that particular period as the overseas acquisition of the company was more opportunistic in nature rather than being strategic. NAB further sold of the GWB that caused a loss of A$67 million.
Current strategies of the companyPESTEL analysis
The PESTEL analysis is an effective tool used by the managers of NAB in order to analyse the macroeconomic factors of the environment in which the company operates. The PESTEL analysis includes the factors such as the political, economic, social, technological and environmental and the legal factors of NAB.
Political- This factor discusses the degree of government intervention into the business of the company. The business of NAB is greatly affected by the governmental policies, foreign trade policies, tax, labour law, environmental law and the trade restrictions.
Economic- The economic growth of Australia, interest rate, exchange rate, inflation rate and the disposable income of the consumers plays an important role on the profitability of NAB.
Social- The social factors that influence NAB are the population growth in Australia, health and career consciousness, believes and the attitudes of the population.
Technology- The technological factors of NAB affects its management in three different ways. First is the new method in the production of goods and services. Second is the new ways in the distribution of goods and services and third new process in the communication with the target markets.
Environment- It is one of the important factors as it includes the availability of the raw materials in order to continue production. The pollution targets, ethical consideration set by the government are also included.
Legal factors- The legal factors of NAB include the health, safety, equal opportunities, and rights of the consumers, product labelling and safety. It is important for NAB to consider the legal factors properly in order to trade effectively.
The specific environment of NAB is the portion of the business that is directly helpful for the company in achieving the objectives. Lozano, Ceulemans and Seatter (2015), stated that the managers need to analyse the specific environment of the company effectively in order to make correct decision for the business. the specific environment of NAB are the target audience that is the customers, government, economy and the competitors of the company.
The SWOT analysis helps NAB to understand and analyse its internal environment. The SWOT analysis is as follows:
· Healthy financial position
· Good revenue and interest income
· Diversity in products
· Largest bank in Australia in terms of assets
· Reduction in the revenue causing poor growth and development
· No global acclaim
· Expansion in international market
· Acquisition and JVs
· Asset management sector
· Strong competition with the rival companies
· Changes in the regulations of the government
· Financial crisis
From the above SWOT analysis of NAB, it can be inferred that the company can use its strength and opportunities effectively in order to minimise its weakness and threats. The analysing of the strength, weakness, opportunities and the threats helps the company to maximise its efficiency level in obtaining higher growth and development.Core values present in the company
Controversies and its outcomes
In the competitive market, the core present value of NAB is very essential in order to support the vision, culture of the organisation. The effective implementation of the core values can be achieved with the incorporation of the effective leadership style within the organisation.
NAB has the participative or the democratic leadership style within the organisation. This kind of leadership allows the team members and the peers to participate in the decision-making, however, the final and the major decisions are carried out by the team leader. In the opinion of Kogg and Mont (2012), the democratic leadership used by the NAB is effective as it helps to motivate the employees by allowing them to actively take part in the business. Moreover, this kind of leadership supports the employees of the company to accept the changes taking place within an organisation as the employees play a vital role in the decision-making process. The leadership style is also effective in the situation when NAB needs to make a decision in the short period of time.
The core values of NAB helps the organisation to enjoy internal as well as external advantage in the business. One of the values of the company is to stand behind the quality of the goods and services offered by the company. Thus, this value automatically removes the product or service that is unable to reach the satisfaction level. The core value of the company is beneficial as it helps to make the customers and the clients aware of the information regarding the company. This provides a competitive advantage to the company.
An effective leadership style has a positive influence on the culture and the strategies of the organisation. The leaders of the NAB Company help to set a long-term effectiveness of the organisation. The effective leadership helps to understand the role that the norms of the organisation play. The democratic leadership within the organisation is helps to influence the team members in order to meet the organisational goals and objectives of the organisation (Goethals et al. 2014). The leadership pattern in NAB helps to develop the ability to create a clear vision that further helps to understand the organisational culture in details.
The democratic leadership helps to increase the productivity of the employees and in turn increases the organisational productivity, as the employees are encouraged to work efficiently by providing those feedbacks, ideas and suggestion. There is a presence of more content workforce as the employees or the team members of NAB has individual role in the process of decision-making.
From the above project, it can be inferred that the corporate strategies of NAB in Australia is an essential component of the company in order to achieve long-term growth and development. The company needs to include strategies that positively affect the business of the company. The market analysis with the help of the PESTEL analysis and the SWOT analysis is beneficial for NAB as the company is able to determine the external and the internal factors affecting the business and the performance of the company. Moreover, the leadership style used by NAB is the democratic leadership style that supports the growth and development of the organisation. The overall study is useful in obtaining the knowledge on the management of NAB that is needed for sustaining in the competitive market.
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