Instructions
Identifying Opportunities for Strategic Information Systems
Select a local company and visit the company’s Web site to find information about that company and to see how the firm is using the Web. On the basis of this information, analyze the business.
Information on all of the following topics can be found in under the Week by Week module s in study online.
Include a description of the organization’s features in the following sections:
1 Important business processes
Describe the organization’s important business processes.
2 Structure
Describe the organization’s structure.
3 Environment
Describe the organization’s environment.
4 Business Strategy
Describe the organization’s business strategy.
5 Strategic information systems
Suggest strategic information systems appropriate for that particular business, including those based on Internet technology.
6 Value chain
Use the value chain to identify the primary and support activities that most directly create value for the company’s customers.
7 Information systems supporting/improving the value chain
List and describe the information systems that would support or improve the activities identified above, thus adding value to the chain.
8 Competitive strategy
Select one or more of the basic competitive strategies to deal with the competitive forces, adapting the strategy to their company.
9 Information systems supporting the competitive strategy
List and describe the information systems that will contribute to their company’s ability to effectively execute the specific competitive strategies identified.
Essay
National Australia Bank
The financial sector contributes to the largest share of national output in Australia. Over 11 percent of National production in Australia came from the financial sector in 2011. The National Australia Bank (NAB) is among the largest Financial Bank in the Republic of Australia. National Australia Bank constitutes a large volume of customers with over 12,700,000 customers and more than 42,000 people.
The essay will analyse the important business processes, structure, the environment, business strategies, and strategic information systems of National Australia Bank. Also, the article will address Value Chain, Information system supporting the value chain, competitive strategies, and information system supporting the competitive strategies of the National Australia Bank.
Important Business Processes
The Bank operates in Australia and New Zealand. The primary objective of NAB involves provision of competitive brands of high quality and services at affordable charges. The bank offers a broad range of the banking products and customer services’ (Fund, 2012). The customers consist of both business and retail sector. The products offered by the bank include Business Banking, Personal Banking, Fixed Income, Currency and Commodities, Treasury, Debt Markets, Specialised Finance, and Asset Servicing (‘National Australia bank’, 2015).
Business Banking products are tailored to suit customers in the field of property, government, agribusiness, health, community, and education. Customers have various channels to access personal banking products which include NAB, NAB Brokers and UBank. UBank is an online division of National Australia Bank.The NAB gets most of its revenue from operation within Australia. In the year 2014, Australia region contributed 74% of the Bank total revenue share. Europe contributed 12%, while New Zealand, U.S.A and Asia contributed 10%, 3%, and 1% respectively (‘National Australia bank’, 2015).
Organisation structure of National Australia Bank
An organisation structure defines the allocation, supervision and coordination of firm’s activities in the achievement of organisation goals and objectives. The Organisation structure of NAB consists of Board of Directors, Executive Leadership Team and Corporate Governance framework (‘National Australia bank’, 2015). A Board of Directors governs the National Australia Bank group. The Chairman of the board of directors is Michael A Chaney. The Group Chief Executive Officer is Andrew Thorburn. Moreover, the board consist of eight Non-Executive Directors.
A committed Executive Leadership Team leads the Bank. The Team comprises of Group Chief Executive, Group Executive and Product and Market, Group Executive Finance and Strategy (‘National Australia bank’, 2015). Also, the team includes Group Executive NAB Wealth, Group Chief Risk Officer, Group Executive Governance and Reputation, Group Executive Business Banking, and Group Executive Personal Banking. Corporate Governance frame work contributes an essential role in ensuring business operations are effectively carried out. The framework guides efficient decision making in all critical areas of the Bank.
Organisation Environment
NAB is among the largest Financial Bank in the Republic of Australia. It constitutes a large volume of customers with over 12,700,000 customers and more than 42,000 people. NAB has a vast network of branches and stores all over Australia and globally. NAB was categorized as 21st biggest bank in the world using Market Capitalisation measurement index. When measured by total assets, it was ranked 41st largest financial institution in the World. The Headquarter of NAB is in Melbourne, Australia and has numerous ATMs globally.
Business Strategy of National Australia Bank
Over the years, NAB has come up with several business strategies. The strategies are vital to the Bank as they guide it in delivering superior returns for their esteemed shareholders. The Bank has invested a lot in ensuring that the customers are satisfied with their products and services. NAB has been the leading financial institution for more than 150 years. The Bank has used the strategy of investing in their strengths. The strategy involves the investment of more resources. The investments aim in serving small and medium businesses. The Bank has continued to deepen its specialization in health, agribusiness, education and government. In individual banking, NAB has been in the forefront in advocating for their customers.
Moreover, the Bank has used the strategy of delivering exceptional customer experience. The Bank focuses in ensuring that it meets its customer needs. NAB understands the essence of listening and responding to their customers’ feedback and queries promptly. The Bank lives to attain its five company goals as one of their business strategies. The goals comprise of Passion for customers, being bold, respecting people, willingness to win and doing the right thing. In attaining these five goals, the Bank gets the chance to cement their competitive position in the industry.
Strategic Information Systems in achieving the Business Strategy
NAB understands the power of information systems in achieving their strategies and achieving better results. The Bank has digitized their business, innovated for simplicity to their customers (‘National Australia bank’, 2015). Through, the information system, the Bank continues to build lifelong relationships with their customers.
With the help of information system, the bank has achieved meeting world-class needs to its esteemed customers. Simplifying the products leads to satisfaction of world-class needs. Also, standardization of their products and services offering has contributed to their positive results.
Information system enables the Bank to keep improving on how they implement change in their business. Also, over the years, NAB continues enjoying high speed and reliability in their transforming processes due to the technology. The Bank is in a position of understanding their performance and how they can improve it without flaws.
The Bank has embraced DIY, do it yourself, digital options to the customers (‘National Australia bank’, 2015). DIY helps the customers to be able to perform most of the bank operations in the comfort of their homes. All these advancement are made possible due to provision and use of the information system in the banking industry. For the National Australia Bank to maintain its dominance in the industry there is the need to use information systems. The information systems provide essential means of transforming how the Bank does business. The end results always lead to improving customer experience and service delivery. Firms operating in efficiency always deliver sustainable and superb returns to its shareholder.
Value Chain of National Australia Bank
Value chain involves a set of actions that an organisation operating in a specific organisation performs to deliver a high-quality product for the market. Value chain ensures that the firm limit risk and add value at each and every stage of product development. According to Samson and Daft, (2011) the manner in which the value chain actions are carried determines the costs and affects profits. In 2014, National Australia Bank achieved annual cost savings of approximately $800m due to value chain addition.
Value chain involves both primary activities and supports activities. Primary activities include such as the marketing and sales of the products, service delivery, operations and logistics. Support activities comprise of human resource management, procurement and infrastructure.
National Australia Bank has replaced ageing infrastructure(‘National Australia bank’, 2015). The move aims at reducing the cost of doing business. Also, the replacement of ageing infrastructure is vital in transforming the manner in which NAB do business. Replacement of ageing infrastructure involves setting data centre, new single general ledger sand upgrade of a procurement system. The replacement of ageing infrastructure is in line with the ever-changing customer taste and preferences.
The value chain is essential in the banking industry where competition among banks is very high. Nemetz (2013) explains that NAB has taken tight control and risk settings in a move to reduce operational risk. Over the years, the bank has a good understanding of the opportunities and risks which are possible in the entire value chain process. National Australia Bank have lowered its current and future risks of its business in terms of operational, reputation and regulatory. Value chain has been key to the Bank in realising opportunities available for innovation. The innovations lead to the higher growth rate of the bank and enhancing productivity due to improved efficiencies. The value chain directly creates value for the bank’s customers and shareholders.
An information system that improves the value chain
The information system in banking system plays a significant role in improving the value chain. NAB has embraced technology to market and sell its products and services globally. Examples of the information system used to better service delivery and customer experience. They include: Mobile apps on all major devices and platform that support mobile banking (‘National Australia bank’, 2015). Improvement of payment process that help for the same day merchant settlement. Another type of information system is Moneytracker and PeopleLikeU that readily provide financial advice to customers.
The bank launched UBank as its Internet banking platform that is essential in value chain addition. Customers can perform many bank transactions without going to the banking hall (Shelly & Campbell, 2012). Human Resources Management has undergone value chain addition where new employees are recruited using modern methods of recruitment. The information system has enabled the bank to perform differential pricing among customers. Also, it has led to creative digital information based solution for their customers.
Competitive Strategy
For the past years, NAB has been keen on ensuring that it maintains its market dominance. Maintenance of market dominance has been possible through coming up with various competitive strategies that include: Acquisition Strategy, Technology upgrades, cost and price leadership, and also differentiation of the products and services, (Morandin & Smith, 2011). The Bank has used acquisition strategy to gain the competitive advantage over its rivals. The reason for using acquisition strategy is an attempt of reducing substantial competition in the market. In 2009, NAB acquired an 80% share of Goldman Sachs JBWere. Also, NAB was in pursuit of acquiring AXA Asia Pacific in 2010 but the deal didn’t go through.
Also, the Bank ought to use the cost and price leadership strategy. Cost and Price leadership strategy ensures that the Bank offers its products and services with the lowest price possible in the market. The bank will have a competitive advantage over the other financial institutions since it operates at low costs and sells its products at lower prices. The strategy is effective as it enables the firm to attract more customers and maintains its market’s dominance.
Information Systems Supporting the Competitive Strategy
Information systems are key for any firm in attaining a competitive advantage in the market. National Australia Bank has been at the forefront of using technology so as to reduce its cost of operations. In October 2008, the Bank set up a branchless bank that launched to trade separately. UBank is the name of the branchless bank. The main aim of establishing UBank was to attract new retail consumers. The branch boasts of a high number of customers since it offers the products at low prices. The low prices of the products and services are made possible due to the existence of low cost of operations. Customers’ satisfaction is met, and this is a key contribution of making UBank as the favourite choice to many customers.
Mobile banking has had a positive impact on reducing the cost of operations thus giving NBA a competitive advantage. Customers have the chance of accessing bank products and services without getting into the bank premises. Through technology, the Bank has embraced business process engineering that has led to the reduction of the operations’ cost with very high margin. Business process engineering is a key driver in reducing the costs. As long as the firm is centred on improving customers experience and service delivery while minimising costs, all its moves will always lead to a competitive advantage.
References
Australia bank. (2015). Retrieved from http://national Australia bank
Fund, I. (2012). Australia. Washington: International Monetary Fund.
Morandin, N., & Smith, J. (2011). Australian Competition and Consumer Legislation Sydney: CCH Australia.
Nemetz, P. (2013). Sustainability and Business. Hoboken: Taylor and Francis.
Samson, D., & Daft, R. (2011). Management. South Melbourne, Vic.: Cengage Learning.
Shelly, G., & Campbell, J. (2012). Discovering the Internet. Boston, Mass: Course Technology/Cengage Learning.
