Portfolio Management For Commonwealth Bank – Activities, Reflections, And Learnings

Part A Activities

The portfolio is presented for managing the capstone subject and gain knowledge about how the business organisation Commonwealth Bank can manage to become successful within the business environment. There are various activities that have been conducted for the organisation to ensure successful business functioning along with gaining competitive advantage in business as well. There will be various marketing concepts considering the marketing approaches undertaken by the company along with the ways of creating value and managing change within the organisation are also considered as important aspects of the research topic (Dinnie 2015). The topic will further evaluate the necessary aspects of employability, digital as well as leadership skills that are necessary for managing business properly and at the same time, there will be critical reflection based on the various activities and while working as a team on a concerned project.

Company overview

The Commonwealth Bank is one of the major financial services provider in Australia and it is considered as a major multinational bank in Australia with business across Asia, New Zealand and all over the United Kingdom and United States as well. It has its headquarters in Sydney, Australia and has revenue of more than 2600 crorers AUD and nearly 52000 employees are currently working for the company (Commbank.com.au 2018). The company has established its position within the competitive marketplace and managed business well and good with the management of subsidiaries including the Commonwealth Securities, Bank West, etc. Commonwealth Bank is known for its great quality financial services and this has gained the attention of customers to seek services from the company and they have been quite satisfied as well with the kinds of services provided by the organisation (Kaufmann 2014).

Marketing concepts

Four P’s of marketing

Product

Being one f the best retail banking sector in Australia, the company has managed to satisfy the customers with its extensive financial services such as loans, credit and debit cards along with savings account and transactions management. It also has the largest ATRM network that allows people to withdraw money or check for any other banking related information with much ease and effectiveness (Lovelock and Patterson 2015). The retail banking services include bank accounts management, loans, insurance, financial planning, superannuation while the premium business services provided to the clients are asset finance, international and online banking activities along with creation of investment opportunities and management of business risks as well. The company also conducts wealth management through a funds management platform, which improves the management of master funds and provides financial advices to clients, which can further assist in providing an insight of the product strategy in the marketing mix of Commonwealth bank in Australia (Singh and Agarwal 2013).

Price

The company follows an aggressive pricing strategy to keep the cost of services under control and at the same time, influence the purchasing behaviours of clients. The home loans markets are captured by controlling the net interest margin, which can also assist in delivering discounts for the financials services provided to clients. The company has become specialised in $300,000 home loans and $1,000,000 loans and it has been possible with the adoption of barbell pricing technique (Yoganathan, Jebarajakirthy and Thaichon 2015). The company has managed to provide 5.3% EAR on the loans, which clearly indicates that the company has been focusing on the other loans and deciding to offer those to the clients at additional discounts too.  

Place

Part B – Self Reflection

Commonwealth bank delivers its services in Australia as well as in New Zealand. UK, US and in other places as well. The company manages its distribution strategy properly to cover various locations and make it convenient for the customers to avail the services. It has a worldwide presence and thus it can easily make the customers influenced to make purchases consistently. There are branches of Commonwealth bank in London, New York City, Hong Kong, Mumbai, Tokyo and in China as well (Khan 2014). The company initiated the Sate funds management by opening its branches in these places and ensure that the clients can easily purchase the services.

Promotions

To manage market segmentation, the company has used social media platforms and even managed advertisements of televisions, newspapers and internet websites to facilitate the awareness among people regarding the financial services delivered. The company being partnered with The Cricket Show, has sponsored the Australian cricket team as to promote brand and differentiated its services from other company products and services (Londhe 2014). The involvement of social media platforms like Facebook, Twitter, etc. further helped in creating more awareness among the clients.

SWOT analysis framework

Strengths · Strong brand image and sustainable position within the marketplace · Multiple subsidiaries and banks falling under the bank and few of those include brands such as ASB Bank, Bank West, Commonwealth Securities and Insurance Limited (E. Dobbs 2014). · It is one of the Big Four banks in Australia because of its higher revenue generation, nearly 52000 employees and increased profit level

Weaknesses · Few controversies emerged related to fraud activities which blamed the bank and it was done by Unhappy Banking website · There have been loan issues, due to which, the covering up of expenses was a major complexity as well · The financial strength seemed to be not much good as expected

Opportunities · The implementation of upgraded and advanced technologies improved the core banking operations and eased the delivery of quality based banking services and even helped in global outreach · The global expansion created more customers and allowed the company to make an entry into market segments with convenience · One Common bank initiative further improved the relationship between business and its customers to sustain growth and development within the competitive business environment.

Threats · There could be threats of competitors in business and the profit level has been affected due to the shareholders’ thinking about global economy · The foreign exchange rates while expanding business globally can also affect the business (Porter and Heppelmann 2014) · In case the counter party cannot meet the obligation, the bank might be subjected to certain risks associated with the financial services’ delivery. · Major competitors are National Australian bank, ANZ bank and Westpac.

Porter’s five forces framework

Threats of new entrants

There could be similar kinds of services available at lower prices by other banks in Australia, but being a major bank in Australia, this kind of threat is relatively low because of the bank’s wide range of service available. The innovation of services can persuade the customers while investments on research and development can maintain organisational standards to meet the clients’ needs and expectations (Rothaermel 2015)

Threats of substitute products

The threat of substitute products can be high in case the value proposition is offered, which is different from the services offered by Commonwealth bank. The company needs to remains service oriented rather than being product focused for understanding the client’s needs and enhance the switching costs of customers too. Setting proper prices can also make them switch from the other company products to the product offered by Common wealth bank (Pirzada and Khan 2013).

Bargaining power of suppliers

The suppliers within the banking sector often use their bargaining power to gain better prices offered by the bank and in case it is not done, then they can switch on to some other bank to supply the raw materials. The threat of bargaining power of suppliers, which is quite low, can also affect the overall profit level. Commonwealth bank has developed effective supply chains, which has implemented new product designs and fulfilled the needs of suppliers (Fallows and Steven 2013).

Figure: Porter’s five forces framework (Fallows and Steven 20139)

Bargaining power of buyers

The threat caused due to the purchasing power of buyers is quite high and have put pressure on the bank. The bank has streamlined the sales and processes of production and provided discounts on the services, which has lead to formation of a large customer base along with higher bargaining power (Cameron and Green 2015).

Threats of competitive rivalry

The competition level is high and it has been caused due to the presence of Australian bank, Westpac and ANZ bank. The designing of services innovatively and setting the right prices, have already made the company sustainable and more preferred by customers within the competitive marketplace.

Change management

The changes are possible by shifting focus on the core competencies of the organisation. The major competence include the ability to solve issues and problems that are not properly structured and may be complex within the business environment. It can not only enhance the social contribution of the organisation, but will also result in innovation and creativity in the form of enhanced services delivery for keeping the quality consistent to meet the clients;’ requirements (Doppelt 2017). The competence of knowing could enable Commonwealth bank to use various theories and models and manage the human resources and company assets properly while the doing competence should allow the company to apply expertise and knowledge practically for dealing with issues in real world situations. The competence field of being could also assist in focusing on the personal values, beliefs and reflect each outcomes based on the mission, vision and change procedures associated with the organization (Wallace, de Chernatony and Buil 2013).  

Management competencies

Figure: Management competencies (Adeniji, Osibanjo and Abiodun 2013)

The management competencies of knowing, doing and being managed by Commonwealth bank have assisted in resolving the issues while bridging the gaps during the practical implementation. The interdependence between these management competencies c has also facilitated critical thinking, which might be useful while working in a group, furthermore allow us to know about the market research, communication procedures, subject relevant knowledge and statistical methods too. The being competence can transform the entire concept of business management and gain in-depth knowledge on the theoretical aspects required to make a proper business plan in the future (Adeniji, Osibanjo and Abiodun 2013). The doing competence is based on the workshop materials and here the feelings and expressions are represented to encourage innovation, creativity and critical thinking efficiently.

Employability and digital skills

The management of employability is concerned with how Commonwealth bank can enhance its global business expansion and create more opportunities for people to get employed within the company. The digital skills of people will improve and the digitalised recruitment procedures could also help them to get selected within the banking institution much easily. The advanced digital architecture has connected the digital skills with the employability, furthermore created more scopes and opportunities for the company to provide employment and reduce the level of poverty. The digital skills are responsible for managing proper communication between employee within the workplace and share or exchange ideas and knowledge while create digital literacy all over the community (Commbank.com.au 2018). The people would be able to connect internet and find out relevant information and at the same time, gain some good opportunities to excel in their educational and professional career too in the future.

Figure: Digital skills and competence (Kaufmann 2014)

Leadership and communication

Leadership is an important aspect of business and it promotes better business functioning along with management of human resources through encouragement and motivation too. Proper leadership skills managed through adoption of transformational leadership style can manage changes within the organisation and at the same time, allow the employees to share their ideas and opinions before making an important business decision (Kaufmann 2014). Leaders are responsible for guiding the organisational employees into the right direction with a shared vision and mission statement; furthermore keep them motivated by providing rewards based on their performances and even arranging training sessions to sharpen their skills and knowledge.

Strategic knowledge development

The development of strategic knowledge should focus on improved operational effectiveness, foster innovation and allows Commonwealth Bank to attain competitive advantage in business. The resource based theory has been useful for making the company accomplish the business goals and achieve competitive advantage while applying these to the market based assets has further helped in transforming the organisational capability. The dynamic capabilities of the bank are responsible for managing changes at Commonwealth bank, which has also helped in reconfiguring the resources and improve the existing resource base to produce significant value and ensure client satisfaction through services’; delivery (Singh and Agarwal 2013). The strategic knowledge development has also been possible with the use of business models and technological disruption models, which are relevant to the strategic intent and influenced the formation of strategies too like incremental evolution, radical substitution and directed transformation strategies. All these strategies implemented have eased down the business operations managed by Commonwealth bank and ensured cannibalisation of existing business processes and transformed it to a new one to generate higher business revenue and competitive advantage in business (Yoganathan, Jebarajakirthy and Thaichon 2015).

Reflection of each activity

As a marketer, I think strategic approach is crucial before starting any activity. This is in terms of systematizing the tasks according to the priorities. Therefore, before commencing the activities, I constructed plans regarding progressing with the activity tasks.

I think clarity in the marketing concepts is important in terms of starting own business. For this, I conducted search engine optimization, which took me directly to the marketing concepts. My first activity consisted of the four P’s of marketing. I learnt that these P’s stands for product, place, price and promotion, which enhance the unique selling proposition for brands like Commonwealth Bank. My learning has been enhanced regarding the applicability of the four P’s in terms of ensuring proper placement of companies like Commonwealth Bank in the market.

The second activity, which I conducted was creation of value. Through keyword search, I came to know that value can be created through understanding the specific needs, demands and requirements of the customers. Within this process, I have learnt that understanding the value proposition helps brands like Commonwealth Bank in enjoying competitive advantage over the contemporary brands. I have also learnt that market segmentation improves the focus of Commonwealth bank on enhancing the productivity. Apart from this, I have also found that devoting the growth capital towards innovation of the products and services is an efficient means for attracting more customers.

The third activity, which I conducted was SWOT analysis. I did this through the means of a tabular framework, which reflected the strengths, weakness, opportunities and threats of Commonwealth Bank. For doing this activity, I conducted keyword search, which enhanced my knowledge about the bank providing quality financial services. I learn that technological advancement has proved beneficial in reducing illegal money laundering scandals and issues. Along with this, technology mitigates the geographical limitations in terms of delivering quality financial services to the customers. I have also learnt that technology acts assistance in terms of expanding the scope and arena of the financial services into the emerging markets of Asia and other developing countries.  

I think conducting the activity on Porter’s Five Forces enhanced my knowledge about the approach of Commonwealth Bank towards maintaining pace with the contemporary brands. Here, I can make the mention of the article, On the contingent value of dynamic capabilities for competitive advantage: the nonlinear moderating effect of environmental dynamism. Reviewing the article has enhanced my awareness about the dynamic capabilities, which brands like Commonwealth Bank needs for enjoying competitive advantage (Schilke 2014).

I can make the mention of change management, which enhanced my awareness towards the approaches of the personnel regarding altering the workplace scenario. Through keyword search, I came to know that change management needs technological consideration, which helps Commonwealth Bank in maintaining the organizational structure. Researching on change management, I realized that it is done through the means of redefining the use of resources, business process, and budget allocation among others.

After producing the reflections of certain activities, I think strategic approach would prove beneficial for me in terms of improving my decision-making process.

Self-reflection based on working in a team

I personally feel that working in a team proves fruitful in reducing the knowledge gaps. I can make the mention of Tuckman’s theory of team development, which was followed prior to the initiation of the activities (Tjosvold and Tjosvold 2015). This enhanced my understanding regarding the means and techniques through which a strong and flexible team is created. I was appointed as a leader of one of the groups, which provided me with the opportunity to make practical application of the learnt skills into the allocated responsibilities. Positive response from the team interactive session members reflected the effectiveness of my leadership skills. I conducted planning in terms of dealing with the allotted duties and responsibilities. As a result, I conducted strategies for controlling the performance of the team members.

Within the strategies, I focused on organizing open forums and discussions. This is in terms of gaining an insight into the issues, which the team members were facing in carrying out the activities. I felt that proved beneficial in terms of clarifying the doubts about executing the tasks in an efficient and effective manner. This session acted as a feedback for me in terms of assessing the effectiveness, appropriateness and feasibility of my leadership skills. I personally assisted in executing the activities, which encouraged and motivated them for exposing better performance. I felt that inculcating self-organizational skills within the employees proved beneficial for the team members in terms of recapitulating on the exposed performance. I instructed the team members to prepare action plans for doing the activities. These action plans helped them in gaining an insight into the activities, which needs to be dealt on a priority basis.

I conducted my evaluation as a leader. For this, I undertook the personality tests, which made me acquainted with my strengths, weakness, opportunities and threats. I used the scores of the personality tests to bring changes within my personality. For this, I developed realistic, achievable and short term goals, which improved my focus on the duties and responsibilities. Failure to fulfil a goal became my stepping stones to success as I carried out project mapping for gaining awareness about the prospective sources, which could lead to my personal as well as professional development. I can relate the Trait theory into these aspects (Schippers, Westand Dawson 2015). Consciousness towards journey mapping would make me aware of the avenues, which I can avail for attaining personal development.

Conclusion

This assessment emerges successful in consolidating and exploring the acquired, knowledge, skills and expertise. Developing a portfolio through the reflection on execution of activities proves beneficial in terms of seeking ways for attaining personal development. Clarification of the marketing concepts upgrades my knowledge about prospering in the field of marketing. Self –reflection on working as a team acts as a criticism in terms of recapitulating on the effectiveness of the exposed performance. Moreover, the reflection seemed effective in terms of seeking effective ways for attaining better placement in future.

References

Adeniji, A.A., Osibanjo, A.O. and Abiodun, A.J., 2013. Organisational change and human resource management interventions: an investigation of the nigerian banking industry. Serbian Journal of Management, 8(2), pp.2-16.

Bouncken, R., Brem, A. and Kraus, S., 2016. Multi-cultural teams as sources for creativity and innovation: The role of cultural diversity on team performance. International Journal of Innovation Management, 20(01), p.1650012.

Burrows, A.C. and Harkness, S.S., 2016. Experiencing action evaluation’s cyclic process: partnering conflict, reflection, and action. Educational Action Research, 24(4), pp.460-478.

Cameron, E. and Green, M., 2015. Making sense of change management: A complete guide to the models, tools and techniques of organizational change. Kogan Page Publishers.

Commbank.com.au. (2018). Personal banking including accounts, credit cards and home loans – CommBank. [online] Available at: https://www.commbank.com.au/ [Accessed 30 Sep. 2018].

Dinnie, K., 2015. Nation branding: Concepts, issues, practice. Routledge.

Doppelt, B., 2017. Leading change toward sustainability: A change-management guide for business, government and civil society. Routledge.

1. Dobbs, M., 2014. Guidelines for applying Porter’s five forces framework: a set of industry analysis templates. Competitiveness Review, 24(1), pp.32-45.

Fallows, S. and Steven, C., 2013. Integrating key skills in higher education: employability, transferable skills and learning for life. Routledge.

Jackson, D., Sibson, R. and Riebe, L., 2014. Undergraduate perceptions of the development of team-working skills. Education+ Training, 56(1), pp.7-20.

Kaufmann, H.R. ed., 2014. Handbook of Research on Consumerism in Business and Marketing: Concepts and Practices: Concepts and Practices. IGI Global.

Khan, M.T., 2014. The concept of’marketing mix’and its elements (a conceptual review paper). International journal of information, business and management, 6(2), p.95.

Londhe, B.R., 2014. Marketing mix for next generation marketing. Procedia Economics and Finance, 11, pp.335-340.

Lovelock, C. and Patterson, P., 2015. Services marketing. Pearson Australia.

Mintz, J., 2016. Bion and Schön: Psychoanalytic perspectives on reflection in action. British Journal of Educational Studies, 64(3), pp.277-293.

Pirzada, K. and Khan, F., 2013. Measuring relationship between digital skills and employability.

Porter, M.E. and Heppelmann, J.E., 2014. How smart, connected products are transforming competition. Harvard business review, 92(11), pp.64-88.

Prokhorov, A.O. and Chernov, A.V., 2015. Self-reflection control of mental states during academic activity. Mediterranean Journal of Social Sciences, 6(3 S2), p.277.

Rothaermel, F.T., 2015. Strategic management. McGraw-Hill Education.

Schilke, O., 2014. On the contingent value of dynamic capabilities for competitive advantage: The nonlinear moderating effect of environmental dynamism. Strategic management journal, 35(2), pp.179-203.

Schippers, M.C., West, M.A. and Dawson, J.F., 2015. Team reflexivity and innovation: The moderating role of team context. Journal of Management, 41(3), pp.769-788.

Schön, D.A., 2017. The reflective practitioner: How professionals think in action. Routledge.

Singh, R. and Agarwal, S., 2013. Does CSR orientation reflect stakeholder relationship marketing orientation? An empirical examination of Indian banks. Marketing Intelligence & Planning, 31(4), pp.405-420.

Tjosvold, D. and Tjosvold, M., 2015. Reflection: Learning to be a Better Team. In Building the Team Organization (pp. 192-202). Palgrave Macmillan, London.

Wallace, E., de Chernatony, L. and Buil, I., 2013. Building bank brands: How leadership behavior influences employee commitment. Journal of Business Research, 66(2), pp.165-171.

Yoganathan, D., Jebarajakirthy, C. and Thaichon, P., 2015. The influence of relationship marketing orientation on brand equity in banks. Journal of Retailing and Consumer Services, 26, pp.14-22.