Discuss about the Strategic Planning for Analysis of Westpac Corporation.
The occurrence of economic extremes has negatively impacted the performance of most businesses. The banking sector is one of the major areas that have promoted entrepreneurial activities in the most parts of the globe. For instance, the initiative of offering cheap loans to encourage investors in Australia created a new generation of individuals who were motivated to acquire economic independence. However, despite the sector being the backbone of economic developments in a country, the industry faces a broad range of challenges. For instance, the industry faces fierce competition from other banks and financial institution, then, sometimes, the State formulation of unfavourable regulations regarding the interest rates the institutions are required to charge its customers (Grant, et al. 2011).
In overcoming some of the challenges, Westpac Banking Corporation has established various strategies that have relatively given it a competitive edge over the rivals. For instance, the company has aligned its business objectives with customer segments by having customer facing divisions (Grundy, 2006, p.213-239). These segments include consumer banks, which handles sales and consumer customers. The second division is Business Bank, which handles small to medium enterprises, agri-business, and commercial clients. The third category is BT Financial Group Australia section deals in the business of wealth and insurance. The fourth division is Westpac New Zealand which offers a range of financial services to institutions, business and consumer customers in New Zealand. Then, finally, the Westpac Institutional Bank provides some financial services to government, institutions, corporate and commercial customers connecting Australia and New Zealand. This diversification of business portfolios is instrumental in propelling the company towards success.
The complexity in the banking industry imperatively requires companies to establish a clear strategy for them for growth. It is the method Westpac has regularly applied to achieve the status it has now. Contrary to which inefficiencies in the operations will enter the company and a culture of laxity may enter the organization (Nongo, et al. 2012). Ineffective operational strategies symbolize inadequate employees focus and the company will eventually lose direction. Consequently, the organization will lose the competitive edge. Further, understanding the vision, mission, core values and objectives acts as a roadmap for directing the organization towards the right course. In addition, the analysis of the internal and external environment is essential for coming up with a strategy that will help improve the performance of a corporation and guide it towards prosperity (Rothaermel, 2008, p. 201-225).
Therefore, the paper has explored the strategic planning for Westpac Banking Corporation. The discussion has analyzed the company’s vision, mission and values statements and their appropriateness to the achievement of the primary objectives. In addition, the paper has covered the goals of the bank and its appropriateness. Furthermore, the internal and external environments have been addressed to find out the company’s strength and weaknesses to aid in the development of operational strategies that best suits the business (Thompson, et al. 2014).
Westpac Corporation and the Industry
As earlier noted the bank is among the top four financial institutions in Australia. The thirteen million customers apparently show how pretty well the bank is performing. The extended stay in the industry gives it a good reputation and image and also enhances the build of trust by customers. The justification of the postulation is based on the current performance of the company. If it could be an exploitative company, the number of customer base could be small. Also, the company could not have grown to this level. It is therefore quite clear that Westpac Corporation is a well-established organization, with a strategic focus and gives priority to customers interests (Kitchen, & Burgmann, 2015, p.212-216).
In Australia, the banking industry is competitive. The competitiveness emanates from the fact that Australia has so many banking and financial institutions. In the event a bank fails to offer best services to its clients, the risk of losing a significant number of the customers to the competitors is so high that may negatively impact on its performance (Hemmatfar, et al. 2010). Besides competition, the industry is faced by economic extremes. The economy of Australia varies with seasonal changes. Since banks performance depends on the steadiness of the economy. Notably, a reduction in the entrepreneurial actions automatically affects the banks. Therefore, the establishment of effective strategies and substantial support by the employees at the implementation guarantees the success of a banking institution or any other company.
Vision, Mission and Core Values of Westpac Banking Corporation
The vision statement for Westpac Banking Corporation is to emerge as the world’s great financial services provider, helping customers, communities and people to prosper and grow. The mission statement is to be a leading provider of financial services in the Australian and New Zealand Markets. This mission and vision statement is appropriate for the organization in that it enables the company to compete in the banking industry favourably.
The system has embedded the company core values in the culture to support the customers. These values encourage teamwork, which ensures working together to deliver the best to the customers and delighting customers where they seek to put a keen eye and moderations so that they can understand their expectations. Another value is courage, where the Westpac team will be bold enough to handle change, not fearing the new way of conducting activities (Ireland, et al. 2008). Finally, they have a value to seek business, team and personal achievement. These values are well suited for Westpac Banking Corporation since they give consideration to all aspects of the organization that is necessary for the growth and again align with the vision and mission of the organization. The compatibilities of the values with organization objectives create efficiency and maintain workers focus on meeting the company’s key aims.
Objectives of Westpac Banking Corporation
Objectives give direction and show the focus and the right way to follow. The objectives should be reviewed every year to ensure that the organization copes with the changing business environment. It helps to balance the risks and returns thus promoting growth. Westpac Banking Corporation has various objectives in line with performance. It looks forward to being the most performing bank in Australia. Also, it is determined to: achieve a management balance between returns, growth, and productivity, to maintain high capital levels to gather for stakeholder’s requirements, to improve funding types to fund diversity for customers and to maintain asset portfolio. These performance objectives aim at improving the performance and sustainability of the business (Hill, 2008, p. 423-440).
Further, the Corporation has objectives in line with the service leadership. These objectives are to: provide the best customer experience regarding products and services offered by the organization, to work on the context-based experiences of the client, to acquire new customers. These objectives are to ensure that the organization gets a good number of clients and that get to be the best experience in the organization. The organization also has targets to consider digital transformation (Daneshvar, et al. 2010). It involves the use of technology to: simplify the operation regarding the services and process, to create a newly digitized bank and to work on the efficiency opportunities from using modern technology. This objective ensures that the company maximizes the latest technology and every chance that comes from it.
Westpac Banking Corporation has goals that target the growth of the corporation. The objectives pursue the growth opportunities and focus on the growth of small and medium enterprises in the region of operation. It will ensure that the organization growth is taken into consideration. Lastly, the organization has objectives that focus on customer service and workforce revolution (Chen, et al. 2006). These targets are to focus on customer service, to strengthen the skills of the workforce that serve the customers, to help workforce to be innovative in serving customers.
These objectives are suited for the Westpac Banking Corporation since they are well aligned with its visions. These objectives also are in alignment with the mission of the organization which is to be a leading provider of financial services in the Australian and New Zealand Markets. In addition, the objectives are also well aligned with the core values making them appropriate for the corporation.
Environmental Analysis of the Westpac Banking Corporation
SWOT analysis is an appropriate tool for the analysis of the Corporation external environment. The tool is essential in evaluating the business situation. By a smart look into Westpac Banking Corporation using the approach, one can identify the weakness and threats to its operation (Fleisher, 2003, p.59). It presents a clear opportunity to do what is necessary to the business in handling operational challenges to improve the service. Therefore, it is important for any Westpac Banking Corporation to analyze the business environment to realize an efficient way for success in the industry (Belch, 2014, p.31-34).
To start with the strengths, it looks into factors that favour Westpac Banking Corporation over other competitors (Rugman, et al. 2008). Regarding this aspect, Westpac Banking Corporation is comparatively better than the closer rivals in the industry. The company applies unique input resources that enables it survive the stiff competition from banks like Commonwealth Banks, National Australian Bank, and more. Among the companies, strengths include: provision of flexible banking services, a large pool of employees, a socially responsible bank, and leading regarding ATM’S in the entire Australia. On the other side, Westpac Banking Corporation also faces various types of weakness. On the edge of the weaknesses, the company faces stiff competition in from rivals in retail banking. Also, it still has a smaller number of branches with the country. These shortcomings have reduced the pace of the company’s growth.
The company has some opportunities that come by. Opportunities are much related to external factors that favour the performance of the business enterprise. It involves knowing the lucrative opportunities that can be sported. Some of the opportunities the company enjoys include the acquisition of a license to open branches to other businesses, high technological focus and innovation, and ability in setting up operations in developing economies (Sonia, 2012, p. 410-420). Lastly but not least, the threats facing the company includes worsening Australian economy, unfavourable regulatory changes by the state.
Westpac Banking Corporation Strategy and its Importance
The strategy of Westpac Banking Corporation is in alignment with the vision by seeking to provide more returns to the shareholders, creating a healthy relationship with the customers, creating a healthy working environment and to be leading and exemplary in the region. In the strategic plan, Westpac Banking Corporation should focus to offer some financial products and services to the core market which is New Zealand, Australia, and the surrounding areas (Bigler, 2013, p. 95-115). The growing number of customers should be given attention to ensure their satisfaction regarding range of service and products and their satisfaction. This will greatly help Westpac Banking Corporation to build a healthy and stronger customer relationship thus success.
To achieve a range of products, the Westpac Banking Corporation should provide varieties financial services thus providing a greater variety that will attract and satisfy increasing number of customers. The diversification will help the company reach and meet the needs of individual customers. This strategy should seek to get a big number of clients and ensure that each customer can have more than one product. Consequently, this plan will enhance business continuity hence more profit to the corporation.
Challenges are expected on the way when building the business to a high level. It is because as the firm grows, the environment becomes more complex becoming hard to handle. In this case, the strategy should seek to straighten the financial position and improve the business efficiency. The management should ensure that services offered are of high quality and satisfies the customer’s needs and at the reduced costs (Armstrong, 2006, p. 256-260). Further, the strategic plan should cover and anticipate change and emerging issues. It is crucial to expect cultural and demographic change and the effects they will have to the customers and the workplace. Therefore economic solutions should be created to the possible environmental challenges. This plan will sustain the vision of Westpac Banking Corporation in the case of the changing business environment.
Finally, a strategic plan is strongly critical to Westpac Banking Corporation because it is the way to achieve the vision of the organization. A well-executed strategy will assure more revenue to customers of Westpac Banking Corporation. It will also help deliver quality services and products to the customers. The best way to achieve execution of this strategic plan is to embed it in business culture, values and business processes. The revenue will result from the determination of the employees towards achieving a common purpose. The growth objective usually surfaces in the form of profit and command of the large market (Macky, 2000, p. 123-130).
To sum up, Westpac Banking Corporation can thrive well than it performs today if the proposed strategic plans are incorporated into the existing ones. After an analysis of the appropriateness of the organization’s vision, mission, core values of the organization, the right course to take becomes clear. Appropriate objectives will give direction and help the organization to move towards its set goals. In addition to this, an analysis of the external and internal business environment will help Westpac Banking Corporation to find opportunities and realize its strengths, point out weaknesses, and the potential threats to the organization. After understanding all this, Westpac Banking Corporation will take the right strategy which is appropriate to the organization. It will consequently help Westpac Banking Corporation to grow and overcome most of the challenges in the industry.
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