Human Resource
Acknowledgement In the preparation and finish this report, we acknowledge the encouragement and assistance given by a number of people and institution. We are most grateful to IFIC’s Human Resource Management Department to provide us necessary information about their organization. We would like to express my gratitude to our honorable course instructor Mrs. Ware Newaz for providing us detailed feedback and advice on this report. She always gave us her guidance and suggestions in making this report as flawless as possible. Executive Summary Understanding practical implications and applications is the next step in the learning process after studying the theoretical concepts of a particular topic. This project topic on the GAP Analysis of a business organization is a part of the next step. In writing this report we came to know about different facets of analyzing a GAP Analysis. Human resource management is an issue of premier precedence in every reputed and winning organization of present time, as it acquires a critical relationship with the best possible functioning of an organization. In our country, only a handful of organizations have proper training management and most of them are multinational organizations. Among the few organizations, IFIC Bank is alleged to have one of the most outstanding and modern methods for maintaining their human resource management. So we chose IFIC Bank as the organization on which we wanted to prepare our report. We tried to know about the current position, performance level along with strength, weakness, opportunities and threats of IFIC Bank. After that we tried to make out the
GAP Analysis for IFIC Bank. Then evaluated and discussed the findings along with the established actions for training of IFIC Bank to show the similarities and contrast between theories and practices. CHAPTER ONE Introduction Origin of the report Eastern University is quality education provider in Bangladesh. This report on IFIC Bank has been prepared as a fulfillment of partial requirement of the course “Human Resource Management” (HRM 527)”. Our course instructor Dr. Ware Newaz, Department of Masters of Business Administration, Eastern University, has instructed us to prepare a report on Human Resource Management. This report has been assigned to submit it on 4th September, 2010. Objective of the report Though our area of concentration is Human Resource Management we have an extra interest on the HR related issues of banking. Our broad objective was to prepare the report successfully. Other objectives of this report are as follows: •
To find the position of IFIC Bank in the banking industry.
• To make out the SWOT Analysis of IFIC Bank •
To analyze the Bank’s performance.
•
To acquire the knowledge about process of GAP Analysis of an organization.
Scope of the report There is a certain boundary to cover this report. To achieve the objective of the report, through knowledge about the organizational functions and its management, it is not possible to cover each and every activity performed in the organization. The report has covered only the general overview of the organization. Moreover the company itself and financial institutions have got some confidential information which is not possible to
disclose publicly, so those data and information had to be ignored for this report. Related discussions have been presented with a proper sequence here. The information used in this report is the most updated one. But some sensitive issues could not be added for lack of proper certified and classified information. Methodology of the Report This report has been written based on primary and secondary sources of data. The data were mainly collected through observation and from learning through practical experience. The data source included primary and secondary, are explained bellowSource of Data To gather information we have used both primary and secondary sources. These two methods are discussed below-
Primary data
Secondar y data
Research Design
The raw dataGathering from own observation
Information from indirect source
Interview Discussion with HR executives and officials Use- Telephone & internet.
Annual Report, 2006,2007. Consultation of related publications Various Bank Statements File and various documents Internet sources
The study combines two distinct parts. These two parts have different characteristics. The organization part is exploratory in nature. It seeks to find the essential character of the assigned organization in order to develop an insight. The project part is descriptive in nature. This part is conclusive and analytical. Limitations of the Report We found some difficulties of preparing the report. Some of them are written bellow:
Relevant papers and documents are not available.
Data insufficiency
Confidential information was not accurately obtained.
Shortage of written material
Time constraint
Technical constraints
Lack of correct and valid information flow
Failure to contact with some managers because of misuse of time
Some analysis on the obtained data is based upon our sole interpretation
CHAPTER TWO
Organization
Introduction Bangladesh is a developing country. Most of the industries of this country are recently established and growing. Banking is one of them. The country’s development is mainly depends upon the economic sector. It is the back bone of any nation. Banking industry is playing a great role in our economy. This sector mainly deals with money which is a major instrument of economy. This sector is moving towards the most customer oriented services and offers with the help of new innovative technologies.
Organization Profile
International Finance Investment and Commerce Bank Limited (IFIC Bank) is a banking company incorporated in the People’s Republic of Bangladesh with limited liability. It was set up at the instance of the Government of Bangladesh and sponsors in the private sector with the objective of working as a finance company within the country and setting up joint venture banks/financial institutions abroad. The Government held 49% shares and the rest 51% were held by the sponsors and general public.In1983 when the Govt. allowed banks in the private sector; IFIC was converted in to a full- fledged commercial Bank. The Govt. of the People’s Republic of Bangladesh now holds 35% of the share capital of the bank. Leading industrialists of country having vast experience in the field of trade and commerce own 34% of the share capital and the rest is held by the general public.
Mission of IFIC Bank To provide service to their clients with help of a skilled and dedicated workforce whose creative talents, innovative actions and competitive edge make their position unique providing quality service. They are committed to the welfare and economic prosperity of the people and the community. They drive from the inspiration and drive for onward progress to prosperity.
Vision To be the leader among banks in Bangladesh and make their indelible mark as an active partner in regional banking operating beyond the national boundary.
Local Branches The bank covers by its activities all the important tracing and commercial centers of the country. As on October 14, 2009 it has 78 branches within Bangladesh.
Branch Distribution of IFIC Bank Ltd in Different Districts Bangladesh
All the important branches are equipped with computers in addition to the modern facilities, logistics and professionally competent workforce. Business Lines IFIC splits its business into four’s distinct groups:
ď‚› Personal financial services: IFIC provides more than 2 million customers world-wide with a full range of personal financial services accounts, mortgage loans, car financing, insurance, credit cards, loans, pensions and investments.
Commercial Banking: IFIC provides financial services to small, medium-sized and middle-market enterprises. The group has almost 100 thousand of such customers, including sole proprietors, partnership, clubs and associations, incorporated businesses and publicly quoted companies.
Global banking and markets: This customer group provides tailored financial services to corporate and institutional clients. IFIC setup joint venture .For which IFIC Bank’s business lines comprise Global Banking, Global Markets, Global Asset Management, Global Research and Principal Investments. This division was previously known as Corporate, Investment Banking and Markets.
Private Banking: IFIC Private Bank is the marketing name for the private banking business conducted by the principal private banking business conducted by the principal private banking subsidiaries of the International Finance Investment and Commerce Bank Limited worldwide. IFIC provide services to each individuals and their families through 78 locations in some Bangladesh. As of December 2007, profits after tax were 1131 million.
Asset Management Remittance Services
Products and services: Collection Services
ATM Services
Products and Services
Employee Benefits
Cash management services
Payment and Clearings Locker Services
Management Structure Managing Director (MD) ďƒ˛
Deputy Managing Director (DMD) Senior Executive Vice President (SEVP) Executive Vice President (EVP) Second Vice President(SVP) First Vice President (FVP) Vice President (VP) Senior Assistant Vice President (SAVP) First Assistant Vice President (FAVP) Assistant Vice President (AVP) Senior Staff Officer(SSO) Senior Officer (SO) Officer Grade- i Probationary Officer (P.O) Officer Grade- ii Cash/ Computer Officer(CO)
CHAPTER THREE
Analysis
SWOT Analysis: SWOT analysis is a simple framework for generating strategic alternatives from a situation analysis. It is applicable to either the corporate level or the business unit level and frequently appears in marketing plans. SWOT (sometimes referred to as TOWS). SWOT analysis is useful when a very limited amount of time is available to address a complex strategic situation. It is a scan of the internal and external environment is an important part of the strategic planning process. Environmental factors internal to the firm usually can be classified as strengths (S) or weaknesses (W), and those external to the firm can be classified as opportunities (O) or threats (T). Such an analysis of the strategic environment is referred to as a SWOT analysis. It's usually used during the beginning stages of a business in strategic and market planning. It can also be used when making decisions and when letting employees know about any changes in a company. A SWOT analysis can be used in your personal life when trying to decide a career path and can assist you in making a niche in your market Strengths, Weaknesses, Opportunities and Threats (SWOT).
Eliments of SWOT Analysis
ďƒź Strengths Relative to market needs and competitors’ characteristics, a manager must begin to think in terms of what the firm can do well and where it may have deficiencies. Strengths and
weaknesses exist internally within a firm, or in key relationships between the firm and its customers. SWOT analysis must be customer focused to gain maximum benefit; strength is really meaningful only when it is useful in satisfying the needs of a customer. At this point, the strength becomes a capability. When writing down strengths, it is imperative that they be considered from both the view of the firm as well as from the customers that are dealt with. These strengths should be realistic and not modest. A firm's strengths are its resources and capabilities that can be used as a basis for developing a competitive advantage. Examples of such strengths include: •
patents
•
strong brand names
•
good reputation among customers
•
cost advantages from proprietary know-how
•
exclusive access to high grade natural resources
•
favorable access to distribution networks
•
Advanced technology
Weaknesses A SWOT may also uncover a firm’s potential weaknesses. Although some weaknesses may be harmless, those that relate to specific customer needs should be minimized if at all possible. Weaknesses should also be considered from an internal and external viewpoint. It is important that listing of a firm’s weaknesses is truthful so that they may be overcome as quickly as possible. Delaying the discovery of weaknesses that already exist within a company will only further hurt the firm. A well-developed listing of weaknesses should be able to answer a few questions. What can be improved? What is done poorly? What should be avoided? The absence of certain strengths may be viewed as a weakness. For example, each of the following may be considered weaknesses: •
lack of patent protection
•
a weak brand name
•
poor reputation among customers
•
high cost structure
•
lack of access to the best natural resources
•
lack of access to key distribution channels
In some cases, a weakness may be the flip side of a strength. Take the case in which a firm has a large amount of manufacturing capacity. While this capacity may be considered a strength that competitors do not share, it also may be a considered a weakness if the large investment in manufacturing capacity prevents the firm from reacting quickly to changes in the strategic environment. Opportunities The external environmental analysis may reveal certain new opportunities for profit and growth. Some examples of such opportunities include: •
an unfulfilled customer need
•
arrival of new technologies
•
loosening of regulations
•
removal of international trade barriers
Threats Managers who are caught up in developing strengths and capabilities may ignore the external environment. A mistake of this magnitude could lead to an efficient organization that is no longer effective when changes in the external environment prohibit the firm’s ability to deliver value to its targeted customer segments. These changes can occur in the rate of overall market growth and in the competitive, economic, political/legal,
technological, or socio-cultural environments. Changes in the external environmental also may present threats to the firm. Some examples of such threats include: •
emergence of substitute products
•
new regulations
•
increased trade barriers
•
Insufficient Attractive Product
Importance of SWOT Analysis The SWOT analysis provides information that is helpful in matching the firm's resources and capabilities to the competitive environment in which it operates. As such, it is instrumental in strategy formulation and selection. The following diagram shows how a SWOT analysis fits into an environmental scan.Itis a tool for companies to assess the industry and to develop strategies to remain competitive. This is a simple way to focus aspects of the company and business sector and to organize the findings to evaluate the current status of the business, future prospects and the economic climate. A SWOT analysis promotes critical and specific thinking to enhance strategic plans and objectives. The role of the internal portion of SWOT is to determine where resources are available or lacking so that strengths and weaknesses can be identified. From this, the marketing manager can then develop marketing strategies that match these strengths with opportunities and thereby create new capabilities, which will then be part of subsequent SWOT analysis. At the same time, the manager can develop strategies to overcome the firm’s weaknesses, or find ways to minimize the negative effects of these weaknesses.
Limitations of SWOT Analysis While useful for reducing a large quantity of situational factors into a more manageable profile, the SWOT framework has a tendency to oversimplify the situation by classifying
the organization’s environmental factors into categories in which they may not always fit. The classification of some factors as strengths or weaknesses, or as opportunities or threats is somewhat arbitrary. For example, a particular company culture can be either strength or a weakness. A technological change can be a either a threat or an opportunity. Perhaps what is more important than the superficial classification of these factors is the firm's awareness of them and its development of a strategic plan to use them to its advantage.
Organizationonal Chart for
SWOT ANALYSIS OF IFIC BANK
ďƒź Strengths of IFIC
•
Strong Corporate Identity
IFIC is the leading provider of financial services locally as well as internationally with its strong corporate image and identity it can make better position in the minds of customers. This image has helped IFIC to grab the personal banking sector of Bangladesh very rapidly. •
Distinct operating procedure
IFIC is known worldwide for its distinct operating procedure. The company’s managing for value strategy better satisfy customers needs and also keeps the firm profitable. •
Distinct schedule
Everyone in IFIC from the appraiser to the top management has to work to the same schedule toward a different aspect of the same goal, interfacing simultaneously at all level over quite a long period of time. •
Advanced Quality
IFIC Bank Ltd. provides its customers excellent and consistent quality in every service. It is of priority that customer is very satisfied. •
Strong employee bonding and belongingness
IFIC employees are one of the major assets of the company. The employees of IFIC have a strong sense of commitment towards organization and proud feelings and a sense of belonging towards their organization. The strong culture of IFIC is the main reason behind this strength.
•
Efficient Performance
IFIC provides hassle free customer service to its client base comparing to the other financial institutions of Bangladesh. The main motto of IFIC is “Personalized approach” to the needs of customers. •
Young Enthusiastic workforce
The selection and recruitment of IFIC emphasizes on having the skilled graduates and postgraduates who have little or no previous work experience. The logic behind is that IFIC wants to avoid the problem of “garbage in and garbage out”= Moreover the young and fresh workforce stimulates the whole working environment of IFIC. • Empowered Workforce The human resource of IFIC is well thought and perfectly managed. As from the very first, the top management believed in empowered employees, where they refused to put their finger in every part of the pie. This empowered environment makes IFIC a better place for the employees. The employees are not suffocated with authority but are able to grow as the organization matures. •
Equalization:
At IFIC, workshops are conducted periodically. At the workshops, all people can participate equally. The new members are also allowed to challenge top managers openly and free to present their personal opinion. •
Free exchange of communication:
At IFIC the main objective of workshops is to remove authority from an artificial spot at the top and place it where the most knowledgeable people are, the people closest to the operations. They are providing free exchange of ideas is reinforced by a policy of” constructive confrontation”. Each employee is expected to challenge ideas openly and aggressively, but never attack an individual’s motives for presenting an idea.
•
“One-to-one” meeting
IFIC believe in one to one meeting and this “one-to-one” meeting held between a supervisor and subordinate. In the meeting, the problems in dealing with customers are put forward first and every one digging it to solve them. •
Modern Technology
IFIC Bank Ltd utilizes of the art technology to ensure consistent quality and operation.
Weaknesses of IFIC ⇒ Narrow operating span IFIC follows the traditional banking operation. Some of the branches of IFIC are still not online. That is why customers sometimes fined problem to pay their due. ⇒ Delay of sanction of loan: For sanctioning a loan, IFIC takes a lot of time. For this reasons customers get irritated and lost their interest to take the loan from IFIC. The main reason of this delay is CIB report. IFIC takes more time then any others to prepare CIB. ⇒ Low remuneration package The remuneration package for the entry-level officers is considerably low. Since other foreign and local banks offer a more lucrative salary package, it will be difficult for IFIC to attract MBA’s in future with its current salary package. ⇒ Lack of diversification IFIC is not at all diversified in its offerings. They seem to offer very limited products to its customers. This deprives the bank from getting a number of benefits. They are also unable to exploit the opportunity of diversification that they already have.
⇒ Few staff meetings It has been observed that there are very few staff meetings and departmental meetings at the branch level. This is not a good management practice. ⇒ Lack of credit cards facilities IFIC don’t have much ATM booths from where customers can withdraw money whenever it is urgent.
Opportunities of IFIC •
Distinct operating procedures
IFIC is noted for its distinct operating procedures. Repayment capacity as assessed by IFIC of individual client helps to decide how much can borrow. As the whole lending process is based on a client’s repayment capacity, the recovery rate of IFIC is close to 100%. This provides IFIC financial stability and gears up IFIC to be in business for the long run. •
Countrywide network
IFIC has the opportunity to expand its operations all over the Bangladesh. This will help them to obtain a strong position in the banking industry. Eventually, expansion will not only increase IFIC’s profitability but also will secure its existence in the long run. •
Diversification
IFIC can pursue a diversified strategy in expanding its current line of business. The management can consider options of starting merchant banking or diversify into leasing and insurance business. As IFIC is one of the leading providers of all financial services in Bangladesh, it can also offer these services.
•
Product line proliferation
There are several opportunities for IFIC to expand its product line. In this competitive environment the bank must expand its product line to enhance its Sustainable Competitive Advantage (SCA). As a part of its product line proliferation, IFIC has the opportunity to introduce credit card, international card, and many other products. •
Progress of E-Banking
Emergence of E-Banking will open more scope for Mercantile Bank Limited to reach the clients not only in Bangladesh but also in the global banking arena. The bank has already entered the world of E-banking and providing full electronic banking facilities to its customer.
Threats of IFIC •
Upcoming Banks
The upcoming private local and multinational banks posses a serious threat to the existing banking networks of IFIC. It is expected that in the next few years more commercial banks will emerge. If that happens the intensity of competition will rise further and banks will have to develop strategies to compete against and win the battle of banks. •
Employees striking
In Bangladesh many 3rd generation banks are coming. As a result employees of the organization want to switch their job because of more facilities. That if why it IFIC do not provide more facility like increment, medical allowance, travel allowance then there is a possibility of employee striking.
•
Insufficient Attractive Product
Many banks are entering the market with new and lucrative products. Actually, the market for banking industry is now a buyer-dominated market. Unless IFIC Bank comes up with attractive financial products in the market; it will have to face steep competition in the days to come. Ratio Analysis Ratios
Formula
Result 2007 2006 2.53:1 1.16:1
1. Current Ratio
= Current Asset
2. Quick Ratio
Current Liability =Current Asset - Stock Current
2.45:1
0.28:1
3. Net Profit Margin
Liability =Net Profit * 100
23%
19%
4. Earning Per share
Turn Over = Profit After Tax
143.87
37.84
5. Return on Capital Employed
No. of Shares =Net profit * 100
37%
16%
6. Asset Turnover
Capital Employed = Sales Turn Over
70 times
119
7. Debtor turnover (In days)
Asset Employed = Debtor * 100
68 Days
times 76 Days
Sales Turn Over EXPLANATION 1.
Current Ratio
The Current Ratio of year 2007 is higher then 2006. Due to Current Asset is more than Current Liabilities. The Bank has ability to pay easily. This mean that is year 2007 bank has the ability to repay the current liabilities. 2. Quick Ratio The current ratio 2007 is higher than 2006.So; Bank has ability to pay the loan easily.
3. Earning Per Share The earning per share of 2007 is higher because net profit of 2007 is greater than 2006. 4. Net Profit Margin The net profit margin of the year 2007 is better than 2006 because interest and other cost is less than other year. 5. Return of Capital Employed (ROCE) The return on capital employed of the year 2007 is better than other year because capital utilization is less but profit is higher. So, the year 2007 is best to the other year.
6. Asset Turnover The asset turnover of the 2007 is better than 2006 because assets utilization is less but turnover is higher .So, the 2007 is best to the other year. 8. Debtor Days The debtor days of the year 2007 is better than 2006 because collection period than 2006.
better
Gap analysis Gap analysis is a formal study of what a business is doing currently and where it wants to go in the future. It is a process that involves the identification of gaps between the current state and the future or desired state is the beginning point for implementation of a school improvement process. It consists of defining the present state, the desired or target state and hence the gap between them. In the later stages of problem solving the aim is to look at ways to bridge the gap defined and this may often be accomplished by backward-chaining logical sequences of actions or intermediate states from the desired state to the present state. The gap analysis process can be used to ensure that the improvement process does not jump from identification of problem areas to proposed solutions without understanding the conditions that created the current state. Gap analysis alone however is not adequate for all problem situations as goals may evolve and emerge during the course of problem solving, "what ought to be" can be a highly variable target. Also, some problems have many alternative solutions, in which case backwardchaining search strategies will have little practical use. GAP Analysis can be conducted, in different perspectives, as follows: Organization (e.g., human resources) Business direction Business processes Information technology
Function of GAP Analysis To make the move towards the future desired state, a company must develop and implement quantifiable and measurable success factors that reflect the difference between success and failure of the organization. If accomplished, a solid critical success factor should establish a competitive advantage over the competition in the marketplace. An organization simply tries to find out the answer of two questions - where are they are now? and where do they want to be? The difference between the two is the GAP - this is how an organization going to get there.
In this diagram the lower line is indicating where the organization will be if they do nothing and the upper line is showing that where the organization want to be in future.
Significance of GAP Analysis Gap analysis looks to improve inefficient business processes by optimizing allocation of all resources and inputs. Many companies are performing below their potential because they either misuse resources or lack the correct investment in technology or capital. Gap analysis highlights these inefficiencies and offers recommendations for improvement.
Benefits of GAP Analysis GAP Analysis helps to provide the company with insight into areas which could be improved. Gap analysis naturally flows from benchmarking and other assessments. Once the general expectation of performance in the industry is understood, it is possible to compare that expectation with the company's current level of performance. Correct gap analysis should increase an organization's production and performance, resulting in higher quality products at a lower total cost. Gap analysis also measures the amount of time, money and resources needed to fulfill an organization's potential and reach the desired state. Requirements of GAP Analysis The most fundamental requirement of gap analysis is consistent, proactive and effective management throughout the planning, implementation and transformation stages of gap analysis. The planning stage and the extensive research required during this stage is the foundation of successful gap analysis. The research needs to focus on both the internal operations of the organization as well as the external business environment. This research provides the necessary knowledge about the current state of internal operations as well as information about aspects, such as market trends, consumer demands and competition, through the process of benchmarking. Benchmarking is a useful business tool used to compare companies similar in nature that provides information and guidelines to what is a realistic desired state.
Types of GAP Analysis The two most popular types of gap analysis are product gap and market usage gap. Product gap analysis concentrates on internal improvements and growth limitations due to certain product or service characteristics. Market usage gap analysis focuses on the
possibilities of growth by evaluating and comparing the current market size to the potential market size.
Practice of GAP Analysis 
Skills Gap
Analyzing the performance of the organization may reveal a gap in employee skills. When the organization uses benchmarking to compare its performance to that of a similar organization, it can identify best practices for increasing employee performance. Closing the gap requires developing a plan to bring employees' skill levels up to or higher than those in the organization used for comparison.  Customer Service Gap Survey research is one way to identify a gap between the organization and its competitors. For example, the organization can survey its various stakeholders, including employees, suppliers, investors and customers, to evaluate the level of customer service it provides. When the organization compares its rate of customer satisfaction with that of similar competitors, it can create a plan for closing the gap between its present level of service and a higher target level. The plan must include specific ways in which employees will individually and collectively increase the rate of customer satisfaction.
 Climate Another key aspect of the organization that can reveal an important gap is its organizational climate. Through assessment of managers and employees, as well as people outside the organization, the organization can identify the quality of the work environment. A study might include items such as employee empowerment, employee perception of management, competitiveness of compensation and benefits, and general working conditions. If gaps are found between the organization's climate with other
similar organizations, then management and employees can work together to develop ways to improve the working environment. Satisfied employees produce better results, and turnover decreases when the organizational environment improves.
 Leadership The organization may study in depth how successful its managers are at leading employees toward achievement of short-term and long-term objectives. Finding out what employees and managers think assists in identifying any gaps between what people believe is possible and what outcomes are achieved. Comparing evaluations of managerial effectiveness over time also suggests managerial approaches that worked better in the past, and these practices might be considered again. Comparing the organization's level of managerial effectiveness with a standard or another organization may reveal specific management issues that require immediate attention Limitations of GAP Analysis
Government Government entities often control what businesses can and cannot explore. Laws that every business should work to carve out a niche market for its products. Businesses are independent and require business-specific gap analysis. Still, competitors will always loom on the horizon and may have already tapped some new growth potential. Gap analysis does not always account for the actions of competitors. Managers should continually analyze what markets competitors are moving into as well as perform gap analyses on their own company's performance.
Technology Technological advances may be known within an organization already and performing a gap analysis may serve to only highlight obvious needs. The gap analysis merely points out what technological advances might be desired by customers but it does not define how these advances may take place.
Seasonality Using specific numbers, or benchmarking, performance of products using quantifiable data is an excellent way to perform a gap analysis, but numbers can sometimes be deceiving. It is important to use a series of numbers or average numbers when performing a gap analysis. The gap may be unusually large if the growth potential of a business is judged against a predictable slow season
Features of GAP Analysis:
Opportunity + Strength = Leverage Opportunity + Weakness = Constraint Threat + Strength = Vulnerability Threat + Weakness = Problem
1. Opportunity + Strength = Leverage When an organization has both the opportunities to reach a top position and have the strength to gain it is called the leverage position for that organization. If a bank is renowned for its divergent operating procedures then it provides the bank various opportunities to maintain its financial steadiness for the long run. The Bank can introduce more innovative and modem customer services to better survive in the competition. It can use the prospect to offer micro credit business for individual and small business. The bank can diversify its portfolio by introducing new sector. Many branches can be opened to reach the Bank's services in remote locations. Besides, if a Bank recruit’s experienced, efficient and knowledgeable workforce as it offers attractive compensation package and good working environment that will ultimately enhance the strength of the organization .The Bank can provide quality service to the clients compared to its other contemporary competitors to gain a better position. If a bank runs its business in a situation with the opportunities and strength mentioned above then we can say the bank is in a leverage position.
2. Opportunity +Weakness =Constrain When an organization have both the opportunity to be best and also have some weakness then the situation the position is called constrain. A bank’s wide networking systems help them to obtain a strong position in the banking industry. The Banks can provide more facilities on on-line banking which will enable the banks to automate all of its operations. At present, several banking functions are performed by computers. The Bank can be a member of SWIFT (Society for Worldwide Inter Bank Financial Telecommunication) Alliance Access which enables the Bank to exchange critical financial messages swiftly and cost effectively. More over Banks can
pursue a diversified strategy in expanding its current line business which helps them as a one of the leading provider of all financial services in Bangladesh. On the other side some banks may have to face some weakness too. Many banks follow the traditional banking operations. Some of their branches are still not online. This is one of the common weaknesses of some banks. Some banks take a lot of time for sanctioning a loan. The remuneration package for the entry-level officer in some banks is considerably low than other foreign & local banks. Some Banks are not all diversified in its offerings. They seem to offer very limited product to its customers. Availability of ATM booth is one of the greatest weaknesses of a bank. If a bank operates its business in a situation with the opportunities and weakness mentioned above then we can say the bank is in a constrain position where banks need to take necessary steps to remove weakness and building up more strength.
3. Threat + Strength= Vulnerability If an organization have the strength to reach an advanced position but may have to face some threat also is called the vulnerability position. Though having the strength banks may have to face some threats. The upcoming private local & multinational banks posses a serious threat to the banking network for a new or running bank. In Bangladesh May third generation bank are coming. As a result employees of the organization want to switch their job because of more facilities. Moreover other multinational banks with various attractive means of providing commercial banking services can take the Bank's lucrative clients away. On the other side a bank’s most important strength is to provide quality service to the clients compared to its other contemporary competitors. Moreover, experienced bankers and corporate personnel can form the management of the Bank, which formulates business strategies. A bank can motivate young and fresh work force as the human resource is the greatest strength of every type of organization. Banks can enhance their strength from the adaptability and dynamism it possesses. Banks can also adapt to excellent standard in terms of banking services.
If a bank operates its business in a situation with the threats and strength mentioned above then we can say the bank is in a vulnerability situation where a bank need to utilize their opportunities to overcome the existing and upcoming threats.
4. Threat + weakness = problem When a bank is in danger situation where it has some weakness and it has to face some threats from competitors also, then the situation is called problem. The upcoming private local & multinational banks posses a serious threat to the existing banking network of a bank. It is expected that in the next few years more commercial bank will emerge. If that happens the intensity of competition will rise further & banks will have to develop strategies to compete against and win the battle of bank In Bangladesh May third generation bank are coming. As a result employees of the organization want to switch their job because of more facilities. Today the world is advancing E-Technology very rapidly. So, it is may be difficult to cope up with the competitors due to poor technological infrastructure of our country. Many banks are entering the market with new and lucrative products. Actually, the market for banking industry is now a buyer-dominated market. Unless Mercantile Bank Limited can come up with attractive financial products in the market; it will have to face steep competition in the days to come. If a bank operates its business in a circumstance with the threats and weakness mentioned above then we can say the bank is in problem and necessary situation should be taken as soon as possible. Current Position of IFIC Bank After observing SWOT analysis of IFIC Bank we find that it is in a leverage position .In the point of strength the IFIC bank are has a strong position in market. In over all situation of banking sector in Bangladesh are growing smoothly that is why maximum number of bank are developing. In a word it can be said to develop a particular bank Bangladesh
have a good infrastructure for banking sector. Here we have studied about IFIC bank and they are bring out a very good outcome not only for the country’s positive bank industry but also for the own capability, good initiative and many other effective decision. In the banking industry IFIC have a strong corporate identity, distinct operating, distinct schedule. All of strength is effective for the IFIC bank. IFIC bank draws from the adaptability and dynamism it possesses. It has quickly adapted to excellent standard in terms of banking services. It has also modified state of the art technology to connect with the world better communication to integrate facilities. This is one of the greatest strength for them. Besides, all the levels of the management of IFIC Bank are exclusively directed to maintain a culture for the improvement of the quality of the service and development of a corporate brand image in the market through organization wide team approach and open communication system. At IFIC, workshops are conducted periodically where all people can equally participate. The new members are also allowed to challenge top managers openly and free to present their personal opinion. Moreover IFIC bank has earned customer loyalty as organizational loyalty which builds up their strength in an effective way.
If we think about the weakness of IFIC bank, it is really low because when it will be compare with other function of SWOT then it must be acceptable. In business sometimes low range of weakness are acceptable and seem to be very normal. Low remuneration package, narrow operating span, lack of diversification and delay of sanction loan can be eliminated by proper utilization of opportunities and by taking necessary steps. There is lot of opportunities for IFIC bank. IFIC bank have the country wide network more ever IFIC can make strongest network which must be stronger then now. They have the opportunity to diversify there strategy and business schedule. IFIC bank contain the most effective things for opportunity that is they have a distinct operating procedure. In the view of IFIC bank they have also some threats such as upcoming new bank. Though it is a threat but it may create the urge to be more efficient and effective by providing quality service. That is why this type of threat can not change the goal of Business. IFIC Bank can use the government support that will facilitate the long-term vision of IFIC Bank.
Moreover there is a great opportunity to take new dimension of banking such as micro credit business for individual and small business, Islamic banking, and specialized banking. There are many sectors where this can give special constitutional rights. IFIC can pursue a diversified strategy in expanding its current line of business. The management can consider options of starting merchant banking or diversify into leasing and insurance business. As IFIC is one of the leading providers of all financial services in Bangladesh, it can also offer these services. Furthermore there are several opportunities for IFIC to enlarge its product line. As a part of its product line proliferation, IFIC has the opportunity to introduce credit card, international card, and many other products.
So, by evaluating the current situation including strength and opportunities of IFIC Bank, we can positively say that this bank is in a leverage position.
GAP Analysis of IFIC Bank After analyzing the SWOT Analysis of IFIC Bank we came to a conclusion that IFIC Bank is in a leverage situation as both their opportunities and strength are high and they have some minor weaknesses that can be overcome easily and minimize the GAP if the bank makes the proper use of the opportunities. IFIC Bank is one of the leading providers of financial services and it has its strong corporate image & identity it can make better
position in the minds of customer. In this competitive environment the bank must expand its product line to enhance its sustainable competitive advantage. The Bank should be diversified by introducing more innovative and modem customer services to better survive in the competition. Furthermore ,government of Bangladesh has provide its full support to the banking sector for a sound financial status of the country, as it has become one of the vital sources of employment in the country now. Such government concern will assist the long-term goal of IFIC Bank to be the leader in banking industry. Banking and information technology might give the IFIC bank leverage to its competitors. IFIC Bank also has the opportunity to introduce credit card, international card & many others products. Cheque clearing and Loan sanctioning procedures should be clear and the time should be minimized. The bank may start separate ATMs at all branches. Operations of the bank should be more prompt and computerized for immediate service delivery. Proper utilization of the resources should be ensured. Moreover the operating span of the bank should be wider to be competitive in today’s market .Use of E-Banking will open more scope for IFIC Bank to reach the clients more easily and quickly. The bank has already using E-banking and providing full electronic banking conveniences to its customer. To have a cutting edge, IFIC Bank can build up and introduce innovative corporate finance and capital market products, suiting the varied needs of corporate clients and investors and the demand of the day to position itself as a force to reckon within this specialized line of business. Besides, FIC Bank constructs their strength by providing quality service to the clients compared to its other contemporary competitors. Employees of IFIC Bank can be one of the major assets of the organization. The employees have a strong since of commitment towards organization. The strong culture of IFIC Bank is the main reason behind this strength. Experienced bankers and corporate personnel have formed the management of the Bank, which formulates business strategies. So, they have the advantage of efficient workforce which can be utilized to meet up the organizational goal if proper training will be provided to them. IFIC Bank can also offer micro credit business for individual and small business. The bank can diversify its portfolio by introducing new sector. Many branches can be opened to reach the Bank's services in remote locations
Overall in our study it can be said that the Bank have a lot of opportunities and strength. IFIC bank’s strengths are not only the as usual strength but, it shows distinct capacity of bank. IFIC banks have great chance to expand there banking activities to all over the country, as they have nation wide banking network and activities. So if they can utilize these opportunities properly then they can overcome the weakness and build up their strength against the threats. By its superior quality of services IFIC Bank can minimize the GAP and earn customer loyalty as organizational loyalty achieved a goodwill among the clients that helps it to retain valuable clients.
CHAPTER FOUR
Concluding Part
Conclusion Today's business is very competitive and complex. To survive in the market the organization needs competent people and has to take some effective policy. Banking sector being a service sector of Bangladesh continues to contribution to a great deal in the economy of Bangladesh. From the close practical inspection of customer dealing procedures during the whole practical preparation in IFIC Bank’s Shantinagar Branch I have reached in firm and concrete conclusion in a very confidant way. I believe that my realization will be in harmony with of the banking thinkers. It is quit evident that to build up an efficient and effective banking system to the highest desired level computerized transaction is must IFIC Bank’s Dhanmondi Branch computer for the daily transaction but the speed of computer is not so high. Beside, every bank has to survive amidst of a large number of banks including local and foreign banks. That’s why to keep pace with expected profit margin of the past to that of the future every bank should try heart and soul to please customers in a smart and trustily way and during my preparation time I talk with some client and they said they are happy with the service but to provide better and faster service more people needed. Because I saw a huge number of transactions occur daily in Dhanmondi Branch. But quite regretful to mention that some of our banks face decreasing profit trend due to switch over of their present customers to the foreign Banks with higher customer service facilities. So, timely decision for introducing sophisticated and modern banking instruments should as early as possible. By taking effective and
defeating measures regarding employees and instruments which will help the IFIC bank to reach the summit of success with profit and productivity.
CHAPTER FIVE Appendix
Bibliography
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Kotler, Philip, “Marketing Management”, 13th Edition,
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IFIC Bank, Annual Report 2006, 2007
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Dessler,“Human Resource Management”,13th Edition
Internet Sources:
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www.ificbank.com.
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Wikipedia
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