National Australia Bank: Operating Philosophy And SWOT Analysis Essay.

Discuss about the National Australia Bank for Operating Philosophy and SWOT Analysis.

Market review or the market analysis can be described as the study of the dynamics and the attractiveness of a market that exists within a specific industry. A market review is an analysis of the industry and it also acts a global environmental analysis. The SWOT analysis is an efficient tool which helps in the domestic as well international market analysis. Opportunity identification can be described as an emerging area or field in the entrepreneurial education. This study is based on the operating philosophy and SWOT analysis of the National Australia Bank.

National Australia Bank (NAB) is one of the largest banking company in Australia due to its customer base, earnings, capitalisation and market. The 3 main services that are offered by the National Australia Bank are banking, loans and insurance.

NAB is one of the premier banking institutes in Australia and is serving the customers with their money for around 160 years. The company presently has around 30,000 employees that are serving 9 million customers in over 900 locations in Australia and also in New Zealand and other parts of the world. NAB is the largest business bank and it works along with the large, medium and small businesses. NAB from the starting position has provided support to several Australian companies and also assisted in every stage of the business lifecycle. NAB funds the vital Australian infrastructure that is found in the communities. This has resulted in a more innovative, inclusive and responsible financial entity. The company has a single objective and that is to be responsible with the money of the of Australian and the New Zealand people along with providing the best in the line customer support (Nab.com.au, 2018a). The NAB provides financial service business and operates in the countries like New Zealand and Australia. The business is located in countries like the US, UK and Asia. The brands of NAB provides the best quality services and the products with the minimal charges and fees. NAB also has a franchise in New Zealand which operates under the Bank of New Zealand (BNZ). The business goal of NAB is to create more services and products which matters the economy, communities and people. Show passion for the customers and also to show respect for the people (Nab.com.au, 2018b).

The main principles upon which the business of NAB is based are as follows:

• The customers of NAB are the advocates.
• The employees are engaged
• The shareholders can receive the attractive returns.

Setting Objectives

The principles can be elaborated under the following 4 major themes which are as follows:

• Great customer experience is delivered.
• Increasing and engaging into the priority customer segments.
• Reshaping the business so that it can perform appropriately.
• NAB must be known for its people, talent and leadership (National Australia Bank, 2018).

The key values that the NAB wants to impart to the employees, staffs and the clients are as follows:

• Independent, diverse, and skilled board so that the business can be operated properly.
• Coordinated, accountable and strong management for the purpose of managing the employee and a large number of the customers and clients.
• Robust policy frameworks and risk management.
• Compliance with respect to the external policy frameworks so that the employees and the staffs can work accordingly.
• Comprehensive and timely communication with the stakeholders and the clients.
• Long-term and genuine commitment towards the sustainability (National Australia Bank, 2018).

The business of NAB is incorporate other areas of business like the agribusiness, healthcare, real estate, education, government, financial planning, corporate and institutional, and other small industries like accountancy, legal sector, franchising, management rights, charitable and religious organizations, financial planning, insurance broking, insolvency (Nab.com.au, 2018c). The majority of the clients are in the banking sector and it has a conglomeration of 9 million clients. This is not an accident because catering to the needs of the people of Australia and New Zealand, the number of the customer or the clients are more in the banking sector (Nab.com.au, 2018a).

 NAB is a financial institution which emphasizes more on the banking services. Considering its range of services provided, the industry is currently expanding with respect to the loans NAB provides to the other industries. NAB belongs to an industry which has the expertise of working for around 160 years and is one of the best and the largest banking institutes in Australia (Nab.com.au, 2018a). Widening the exposure to this industry can have a widening effect on the huge number of the customers and the clients it serves. Widening the exposure will incorporate customers from other countries and will help the other business entities to interact with NAB.

The market size of NAB is more focused on the customer of the New Zealand and Australia. The banking core operation is dedicated to the customers of these countries. NAB also has it banking operations located in other countries like US, UK, and Asia. Considering the size of the business of NAB, the clients that are attracted especially belong to all the corporate, medium and small business. NAB currently has its business operation associated with the wide range of industries like agricultural, healthcare and other industries like real estate, education, government, financial planning, corporate and institutional (Nab.com.au, 2018e).

The services that are being provided to the clients are of different types- accounts: transaction accounts, deposit and savings accounts and specialised accounts; loans are provided to the clients; business cards; payments and merchants: merchant support centre, EFTPOS terminals, e-commerce, recurring and billing payments, making payments; online banking; international and foreign exchange: international payment and trade methods, financial methods, risk management, trade finance; insurance and superannuation; industry-specific banking (Nab.com.au, 2018d). The clients are asking for the most connectivity and more options to online features for the customer feasibility. The customers also want loans in smaller amounts which will have nothing to hide (News.nab.com.au, 2018a).

Operating Philosophy

 NAB is losing clients via the bad financial advice to the customers which is costing NAB million in terms of compensation to the customers. The NAB has confirmed that the bank has paid millions of dollars to the customers as a compensation for giving false financial advice. Media reports reveal that around 700 customers have been compensated so far that have received bad or wrong financial advice. Since the year 2009, NAB has lost around 10 to 15 million dollars for compensating its customers. This is one of the reason due to which NAB is losing customers (ABC News, 2018).

The top three clients are the banking customers, small business entities and the insurance buyers.

The list of the services provided to the banking customers are: banking services: credit cards, transaction accounts, savings accounts, internet banking, NAB visa debit cards, NAB term deposits, ways to pay; loans: home loans, personal loans; insurance: contents and home insurance, landlord insurance, car insurance, travel insurance, life insurance, trailer and caravan insurance, home loam insurance, personal loan insurance, credit card insurance, injury insurance; superannuation: super through NAB, super strategies, pension, financial advice, self-managed super fund; investments: online investing, property, self-managed super funds, investment lending, cash management; travel and international: travel money, NAB traveller card, foreign currency cash, travel proof credit card, foreign exchange rates, receive money from overseas, transfer money overseas, moving money from one bank to another, NAB foreign currency account; life moments: buying the first home, travelling overseas, retirement planning, buying second home, sorting of the finances after divorce, paying the mortgage, home renovation,  managing injury and illness, losing the loved ones, investing in a property, debt management, buying car, saving and budgeting,  dealing with the unemployment (Nab.com.au, 2018f).

The services provided to the small business are: starting a business; choosing the business finance; tax, planning and cash flow; expanding the business locally and globally; marketing and online (Nab.com.au, 2018g). The list of the services provided to the insurance buyers are as follows: contents and home insurance, landlord insurance, car insurance, travel insurance, life insurance, trailer and caravan insurance, home loan insurance, personal loan insurance, credit card insurance, injury insurance (Nab.com.au, 2018h).

The services provided to the clients can be offered in a better way through the better financial advice. The timely delivery of the loans to the small business entities and also through the development of products which will be more customer oriented and has a greater scope of usability.

Identification of the Opportunities

NAB has specializations in providing the services and products that are tailor-made for the customers and the clients. The technologies that are employed by NAB are morning podcast, NAB adds the google pay and Samsung pay, and including the virtual assistant in the official app (News.nab.com.au, 2018b). The skills of NAB includes the various product and the services offered and the skilled employees that are working in NAB.

Strength- high level of customer satisfaction, highly skilled workforce, good amount of returns on the capital expenditure, automation of the activities, marketing strategies, best performance in the new markets, strong brand portfolio, strong distribution network (Nab.com.au, 2018i).

Weakness- financial planning, inventory days is high in comparison to the competitors, marketing of the products is not up to the mark, organizational structure is only compatible with the present model and not include the branch expansion, not successful in integrating with the work culture, NAB is not able to tackle the challenges (Nab.com.au, 2018i).

Opportunities- new trends in the behaviour of the customers, government green drive, the flow of cash in a stable way, a new customer coming from the online channel, new technology, new environmental policies.

Threats- changing customer behaviour, liability laws, the supply of the innovative products are not done, rising pay structure, rising cost of the raw materials, currency fluctuations in different countries (Nab.com.au, 2018i).

The increase in the market volatility arising due to the factors like the Brexit and the policies taken up by the U.S governments has led to the several risks in the banking industry. The economic conditions have led to the market fluctuations and the several banks have already faced loss. Thus, it is necessary to include a robust and dynamic market analysis in order to enter into a new country (Time, 2018; Musaddique, 2018).

Conclusion

From the above discussion, it can be concluded that the huge number of the banking entities work for the customer and provide them with the banking services. For this study, NAB is selected which works for the customer of the New Zealand and Australia. This has led to the framing of products and services especially based on the feasibility of the New Zealand and Australian customers.

Reference

ABC News. (2018). Bad financial advice costs NAB millions in compensation. ABC News. Retrieved 28 April 2018, from https://www.abc.net.au/news/2015-02-21/nab-pays-millions-in-compensation-over-bad-financial-advice/6172650

Musaddique, S. (2018). This is how Brexit has impacted the business world in 2017. The Independent. Retrieved 1 May 2018, from https://www.independent.co.uk/news/business/news/brexit-economy-sterling-currency-investment-cost-impact-business-financial-banks-insurance-retail-a7695486.html

Nab.com.au. (2018a). About us. Nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/about-us

Nab.com.au. (2018b). Our business at a glance. Nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/about-us/our-business-at-a-glance

Nab.com.au. (2018c). Industry specific banking. Nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/business/industry

Nab.com.au. (2018d). Business. Nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/business

Nab.com.au. (2018e). Personal. Nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/?rwd

Nab.com.au. (2018f). Personal. Nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/personal

Nab.com.au. (2018g). Small Business tips. Nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/business/small-business

Nab.com.au. (2018h). Insurance. Nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/personal/insurance

Nab.com.au. (2018i). SWOT analysis. nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/business/small...a.../how-to-use-our-swot-analysis-template

National Autralia Bank. (2018). nab.com.au. Retrieved 28 April 2018, from https://www.nab.com.au/content/dam/nabrwd/About-Us/.../2017-annual-review.pdf

News.nab.com.au. (2018a). Customers | NAB News. News.nab.com.au. Retrieved 28 April 2018, from https://news.nab.com.au/category/customers/

News.nab.com.au. (2018b). Technology | NAB News. News.nab.com.au. Retrieved 28 April 2018, from https://news.nab.com.au/tag/technology/

Time. (2018). Why Brexit Really Is a Big Deal for the U.S. Economy. Time. Retrieved 1 May 2018, from https://time.com/4383202/brexit-america-fallout-economy-fed/