The report will be based on the analysis of external environment in which an organization operates. The ways by which marketing environment of the organization is able to affect the levels of profitability and revenues is a major part of the report. The company which has been chosen for analysis is Emirates NBD which is a multinational organization that has its operations in UAE. The organization has been able to develop a significant share in the market of its operations. The main aim of the report is thereby to analyse the internal environment of the organization and the competition which it faces in the industry (Abedifar et al. 2015). The corporate social responsibility based activities which are performed by the organization will also be analysed in the report.
Emirates NBD is a large banking organization which operates in the Middle East. The organization has been able to develop the largest position in the market in terms of amount of assets which have been gained by the company in the industry. The organization was established in the year 2007 with the help of merger between two major banking based institutions including National Bank of Dubai and Emirates Bank International. The organization further expanded its operations in many other countries of the world including United Kingdom, Singapore, Saudi Arabia, China, Indonesia and India (Emiratesnbd.com, 2018).
The organization operates with the help of greater than 9000 people who represent 70 nationalities. The major objective which has been set by Emirates NBD is based on the proper development as well as management of the Real Estate and different Real Estate related projects as well. The major activities which are a part of the objectives set by the company include, selling, buying, facility maintenance based activities, repair, renovation, decoration and furnishing. The mission statement of Emirates NBD is based on making the lives of customers simpler with the help of solutions which are helpful in fulfilment of financial aspirations (Emiratesnbd.com, 2018). The major marketing based goal of Emirates NBD is based on providing best levels of services to the consumers. The most objectives of the organization are based on maintaining the leading position in the financial industry.
The marketing based environment of Emirates NBD can be analysed effectively with the help of PESTEL analysis framework. The different trends which exist in the market can be analysed with the help of this framework.
Political factors – The banking and financial industry has been facing huge levels of challenges in the current business situation in the Middle East. The expansion related activities of the organization into new geographical areas is also a major issue which is being faced by the organizations in the financial industry. Emirates NBD has faced major issues based on the rise which has been experienced in costs of domestic deposit based rates in the competitive market. The pressures based on liquidity and funding have been quite evident in the financial market of UAE. This is considered to be a major reason which is able to affect the expansion of the organization in other areas of the world (Al Dari, Jabeen and Papastathopoulos 2018). Rating provided – 3
Economic factors – The development of economic environment of Emirates NBD is based on rates of free trade in the country. The local and the international investors are also provided with encouragement in order to invest in the country. The financial investment based market in UAE is affected by three major factors which include, inflation, interest rates and Gross Domestic Product or GDP. The rates of foreign exchange had been affected by the economic crisis which had occurred in the year 2008. This has played a key role in creating high levels of difficulties within the country (Almarri and Abu-Hijleh 2017). Emirates NBD had also faced losses in its operations at the time of economic crisis. Rating provided – 4
Social factors – The performance levels of Emirates NBD had been affected by the social and cultural factors in the environment. The major forces which need to be considered for the operations of the banking based sector mainly include, language, religion, population, ethnic groups, literacy rates. The social responsibilities had been provided high importance by Emirates NBD. The bank had further consulted with the stakeholders who had shown high involvement and participation in these activities (Al-Tamimi, Lafi and Uddin 2016). Initiatives had also been taken by the local government in order to operate in the environment. Rating provided – 2
Technological factors – Banking industry has been facilitated by the technological advancement that has taken place in the Middle East. The levels of involvement of financial sector with technological advancements are also quite high. Internet has been able to play a key role in proper operations of different financial organizations. Online banking is thereby quite prevalent in the industry and different banking activities have been facilitated. The banks have started providing facilities like mobile banking to the consumers (Banerjee and Majumdar 2018). This has played a major role in providing high levels of convenience to the consumers. Rating provided – 3
Legal factors – The auditing based activities of banks have been affected by different legal authorities. Emirates NBD and its operations have been affected in a huge manner by the legislation frameworks which are formed by the government. The central bank of UAE has also announced liquidity management based rules for different banks which operate in the country. The banks including emirates NBD need to follow the regulations which are developed by the central bank or the government (Bose and Bandyopadhyay 2018). Rating provided – 3
Environmental factors – The environment which is prevalent in UAE is hot and dry in nature which can affect the operations of different organizations. The climate however has quite low effect on the financial industry and operations of different financial organizations as well (Hamdan 2016). Rating provided – 1
Decision rule analysis – Sum of different factors – (3+4+2+3+3+1) = 16
Rating = 24/16 = 1.5
The result of decision rule analysis has been able to depict that the operations of Emirates NBD is highly favourable in the financial industry of Middle East.
The corporate social responsibility based activities which have been performed by Emirates NBD can be analysed with the help of Carroll’s CSR Pyramid which is considered to be a simple framework. The CSR based pyramid of the organization is based on the profitability based levels. The ways by which the organization is able to comply with the regulations and laws is also a part of the pyramid. The philanthropic options are further considered to be the last part of Carroll’s Pyramid. The four major responsibilities which form the CSR pyramid include, economic, legal, ethical and philanthropic (Jan and Marimuthu 2015).
The economic responsibilities were fulfilled by the organization with the help of its products and services. Emirates NBD has been able to develop the topmost position in the banking industry of Middle East. The regulations which have been developed by the government are followed in an efficient manner by the organization. The ethical responsibilities followed by Emirates NBD are based on the sustainable operations in the industry. The organization further aims at improving the living based conditions of the society in which Emirates operates. Ethics are promoted by the organization with the help of effective experience which is provided to the customers (Kumar 2016). The bank has been able to reach more than two million people all over the world with the help of its services. The bank aims at expanding the opportunities and strengthening different communities based on the social commitments. The Exchanger Volunteer program has been organized by Emirates NBD in order to fulfil the philanthropic responsibilities. This program is based on the ways by which the organization aims at serving the community and bringing changes in the lives of people.
The financial industry in which Emirates NBD has its operations is highly competitive in nature. Different services which are offered by the organization included, personal banking, home loans, auto loans and credit cards. The two major competitors of Emirates NBD in the financial industry are First Abu Dhabi Bank and Abu Dhabi Commercial Bank. The lending based environment which has been created in the Middle East is highly competitive in nature. The financial industry is based on different local banks which are able to provide financial services to the customers in Middle East (Naeem and Azam 2017). The mature market in UAE has become more competitive and Emirates NBD can increase its shares in the market with the help of different services.
Emirates NBD has been able to maintain its topmost position in the industry in spite of different issues which have occurred in the financial industry. The analysis of internal environment can be evaluated in order to decide different factors which are able to affect the operations. The SWOT framework can be used in order to analyse the internal factors which are able to affect the levels of profitability and revenues (Nawaz and Haniffa 2017).
Strengths
Weaknesses
Opportunities
Threats
The internal analysis of Emirates NBD has been able to depict that the company has been able to establish itself successfully in the industry. However, the organization has not been successful in developing an international presence of its activities and operations. The major strength of Emirates NBD is based on the position which is held by the organization. The major targets which have been developed by the organization mainly include, the small or medium sized organizations and the large institutions as well (Tabash and Anagreh 2017).
The strengths of the organization can be used effectively in order to increase its shares in the financial industry. The growth based opportunities which are created by the organization can be helpful in reducing the threat based levels. The financial resources need to be used by the organization in an effective manner in order to enhance the levels of profitability of the organization. The huge levels of competitiveness which has been provided by the mature financial market of Middle East can be mitigated with the help of proper financial resources. International expansion is also considered to be a major opportunity based on growth in the financial industry (Tlemsani and Al Suwaidi 2016). This will be helpful for the organization to provide tough competition to the other banks which operate in the industry including, Abu Dhabi Islamic Bank and Bank of Sharjah. The policy based on cost-reduction will also play a key role in formation of business based opportunities in the domestic and the international market. The cost of operations based threats which are faced by Emirates NBD can be reduced in order to mitigate the threats and further increase its share in the market as well. The loan based services can be provided to the consumers at lower rates in order to operate profitably in competitive financial industry.
Emirates NBD has created a position of the largest bank in the financial industry which has been helpful in surmounting the levels challenges which are faced by the organization. The market leadership based position which has been formed by the organization has not been highly affected by the weak economy of Middle East. The organization thereby holds a unique position in the financial industry with the help of different loan based products and services that are offered to the consumers. The profits of the organization have also increased in current business environment due to different infrastructure based projects (Trabelsi and Trad 2017). The investments which are being made by the organization in technology are important factors which have affected the profits of Emirates NBD.
The products which are offered by Emirates NBD have been helpful in the development of topmost position in the banking and financial industry. The products and services which are offered by the organization are perceived to be high quality by the target customers. The associations which have been formed by Emirates NBD with the shareholders have provided value to the operations in an effective manner. The products which are offered to the consumers by the competitors of Emirates NBD are not able to qualify of better quality as compared to those which are provided by the organization (Zanella, Oyelere and Hossain 2015).
Conclusion
The report can be concluded by stating that Emirates NBD has been successful in maintaining its position in the financial industry with the help of proper services. The topmost position of the organization and its financial resources have played a key role in the ways by which Emirates NBD has mitigated the risks which are faced. The internal analysis has been able to provide a clear picture of the aspects of Emirates NBD which will play a key role in the future operations. Positioning analysis of the organization has provided an insight based on the position which is held by the competitors of Emirates NBD as compared to the organization. The external environment has played a major role in affecting the profits and revenues of Emirates NBD. The analysis has been able to depict that the external environment and financial industry has been able to affect the operations of Emirates NBD in a huge manner. The organization can further increase profitability levels with the help of proper increase in research and development and implementation of proper technologies within the organizational operations.
The levels of growth which have been experienced by the financial industry of
UAE are quite high. Emirates NBD has enhanced the business operations in domestic market by providing diverse solutions. The realignment of business activities is a major recommendation which can be provided to Emirates NBD in order to increase its revenues. The strategic approaches can be implemented by Emirates in order to engage the customers in organizational operations. The merger and acquisition based policy has been helpful in developing the revenues in domestic market. The development of online channels can further increase the levels of revenues. The productivity levels of staff of Emirates NBD need to be enhanced in order to increase the levels of profitability in the financial industry. Automation and technology can play a key role in the successful operations of the organization in the financial industry.
References
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Al Dari, T., Jabeen, F. and Papastathopoulos, A., 2018. Examining the role of leadership inspiration, rewards and its relationship with contribution to knowledge sharing: Evidence from the UAE. Journal of Workplace Learning, 30(6), pp.488-512.
Almarri, K. and Abu-Hijleh, B., 2017. Critical Success Factors for Public Private Partnerships in the UAE Construction Industry-A Comparative Analysis between the UAE and the UK. Journal of Engineering, Project & Production Management, 7(1).
Al-Tamimi, H.A.H., Lafi, A.S. and Uddin, M.H., 2016. Bank image in the UAE: Comparing Islamic and conventional banks. In Islamic Finance (pp. 46-65). Palgrave Macmillan, Cham.
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Hamdan, A.M.M., 2016. Market power versus efficient-structure in Islamic banking industry: evidence from selected GCC countries. International Journal of Islamic Marketing and Branding, 1(3), pp.285-295.
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