Commerzbank System - Coursework Example

Introduction Strategic analysis refers to the process of taking into account current and future eventsthat take place in an organization. The analysis helps the management of an organization to anticipate the events that will happen in the organization, evaluate those events that will occur and assist in tackling problems that may happen in the future. The importance of the analysis is that it enables the top management to set up goals, make quality decisions and set up strategies that are crucial for the growth and development of an organization (Grant 2005). Commerzbank It is financial institution that offers banking services and other different products to their customers. It was established by individual and merchant bankers in Hamburg in the year 1870 after consolidating with Berliner Bank. It is the second largest bank in Germany after the Deutche bank whose headquarters are in Frankfurt. The bank has several branches situated in Europe, London, Luxembourg, Poland, Spain and Switzerland. The main banking services offered by the bank are commercial banking services, retail banking and mortgaging (Binder 2006). Commerzbank Internal Strategic Analysis The management of the bank uses a financial information system known as the info broker. This system is used to ensure that strategic and content demands of the bank are met within the specified period of time. Its objective has been to ensure that current financial information, customers' data and banks internal information are consolidated into one single application in order to enhance proper delivery of services to the customers (Binder 2006). Business systems Business systems refers to the systems that are found in business organizations composed of large number of businesses, tradesmen in the same field of operation that combine resources, enhance sharing of information and also provide services that are beneficial to the organization. System Application Program (SAP) software is business software that consists of enterprise resource planning and related applications that enables the users to run the operations in the organization in an efficient manner. It also enables the bank to solve their core banking processes. System Application Program (SAP) software consists of tools and automated processes that assist the management of a company to manage the front office activities in the banking environment away from the transactional banking services, customer management systems, cost control, financial accounting and profitability and to undertake risk analysis of the bank (Laurentis 2005). The management of the Commerzbank implemented the System Application Program (SAP) software to centralize and optimize the business processes of the banks solutions portfolio. It also restructured systems such as the loan transaction business unit and the loan factory unit that can process over 1.2 million loans while using the System Application Program (SAP) solution portfolio. The other systems that were restructured were the enterprise -wide standardized and integrated processes. The features within the System Application Program (SAP) solution system enables the bank to have improved efficiency and enables performance of the bank to be carried out through using a high degree of workflow automation that has a shorter processing period (Laurentis, 2005). The banks factory loan system enables it to provide an integrated information technology system in business areas that are based on standard solutions to account for a high level of integrated workflow automation for the company. System Application Program (SAP) software also helps the company to serve many company's clients at reduced costs. Major Banks in the world are using the software because it leads to higher levels of productivity, agility and improves the way banks conduct their activities. The use of the balance sheet and risk systems has contributed to the success of the bank in matters such as; increased release of quality data, improved risk selection and provision of transparency in areas that involve the borrowing of resources from one person to another. The use of SAP software has enabled the company to reduce the cost of processing and serving the customers in a more convenient manner (Binder 2006). COBaCash is an operating system that is used to optimize the supply of cash to different branches in the world as well as cash machines that integrate forecasts and ordering systems. The machine ensures the right amount of cash is made available for use and at the right time. Integrated forecasting tool is used to determine the cash requirements that may be required by the customers in the future. The linked optimization tool is used to reduce the cost incurred as a result of running the affairs of the bank (Laurentis, 2005). Commerzbank has also implemented a system known as Commerzbank Worldwide Inquiries System (COWIN) that is intended to automate the process of making inquiries and reducing the cost of operating the activities within the organization. The major function is to provide rapid responses to inquiries from the other employees and customers through using facilities such as; telephones, internet, fax, post and swift messaging method (Binder 2006). Organizational Structure Organizational structure refers to the framework of rules and regulations that govern how an organization is run, coordinated and ensures that there is proper flow of information in the different levels of management. A well structured organization helps an organization to delegate different responsibilities and duties amongst employees within the organizations departmental units. The skills, size and products are internal factors that determine how successful an organization can be in carrying out its roles (Meel 2000, p.182). The Commerzbank bank is composed of the following departmental units; board of managing directors, supervisory board, corporate division, services department and their subsidiaries, cooperate ban assurance, domestic and foreign branch network unit. The System Application Program (SAP) software is used by the management of the organization in managing the persons employed within it in order to increase the rate of productivity. During the year 2000, the bank acquired equity stake in seven micro finance banks in areas such as Albania, Bulgaria, Bosnia-Herzegovina, Romania, Kosovo and Serbia. These Procredit banks where Commerzbank is a shareholder, have similar organizational structures that are composed of public and private partnerships together with commercialization that aids in enhancing growth and development in the financial sector. Commerzbank Procredit banks also have a basic business policy orientation that is shared equally amongst the sub-banks, expatriates assist the banks employee in promoting institutional building that have no subsidies and the enhanced use of advanced technology that ensures that banks activities are run in the right and proper manner ( Laurentis 2005). Organization Processes An organization process refers to the things that make a person to be organized and remain in an organization despite the challenges that they may face within the work place. Commerzbank has implemented Human resource System Application Program (SAP) software process and replaced the information technology facility that is aimed at handling tasks that involve; processing the payroll of the employees, managing functions as organizational, recruitment and time management of the bank that enables the management and other supporting staff to carry out their tasks in the appropriate manner (McLean 2006). Organization Culture Organization culture refers to the values, beliefs, customs and practices that are equally shared by the members of an organization and later on passed on to the next generation of employees who may be employed to run the operations of the organization in the future. The management of Commerzbank involves its employees in shaping and structuring the banks operations through conducting continuous and comprehensive surveys so as to assist in improving the performance of the bank. The importance of the employee survey process is to enable the management is able to identify the key factors that enhance employee commitment to their work and also foster the success of the company (Cameron & Quinn 2005). There are two kinds of employee survey programs that are undertaken within the company. They include short and full survey. Short survey is a process that is undertaken on an annual basis whereby the top officials of the company evaluate the trend of the employee's commitment to their activities and determine the opportunities that they should be taken in order to improve on the performance of the banks activities. The full survey is carried out after a period of three years where the management focuses on factors such as; work life, compensation and work environment of the employees in order to improve on their performance and to provide an environment in which the employees can effectively carry out their activities in the right manner (O'Sullivan 2000). The banks strategic capabilities, strategies adopted and current position in the industry: Commerzbank strategic capabilities The bank has been in a position to have a greater competitive advantage due to focusing on crucial factors such as the customers, markets and products in the domestic retail and small market enterprises franchises. It has also recorded a strong risk management capability, conservative risk culture, and favorable trends in handling its assets which have proved to reduce the chances of being exposed to risks, cost of risk and coverage levels that would affect the performance of the organization (Padoan, Brenton & Boyd 2003). The work team has been committed in setting up strategies that are important so as to strengthen and protect the banks financial and strategic capabilities and to improve on its profitability and capital levels. The liquidity levels and position are equally strong thus; the operations of the company have been conducted in an effective and efficient manner during the trading period. Operating systems of the company have led to the increased earnings of the bank and they have largely contributed to higher amounts of profits. The good capital base and business lines have enabled the management of the company to forecast on how the activities of the company will be carried out in the future (Padoan, Brenton & Boyd 2003). Strategies adopted by the bank The management of the bank has adopted a flexible exchange rate rgime. It is aimed at ensuring that the company adapts to the financial crisis being experienced in the world and other challenges that may hinder the good performance of a company. A flexible exchange rate is a rate that keeps on changing and whose trading is determined by the forex market. This rate determines the external value of a currency by evaluating the demand and supply of products and services in the market. The bank has also adopted a variable rate agreement for assets and liabilities that is aimed at ensuring that the rate of interest rate is curbed so that it may not affect the performance of the company in the future (Walldorf & Frankfurt 2008). It has also adopted a credit risk policy which uses the standardized credit risk approach aimed at calculating the way capital requirements of the bank are carried out, the way it values financial securities and indicates the way capital requirements are carried out within the organization. Credit risk is covered by factors such as provisions of impairment for loss and provisions for risks that are recognized on a quarterly basis through using a customer's rating basis format. The other strategy that has been adopted involves provision of innovative and customer oriented services for their customers through strengthening the product development activity thus consolidating the market position and company's image and brand in order to improve on the performance of the bank (Teledata 2005). The major objectives that the company aims at achieving in the future involve; consolidating its banks position into a European integrated financial institution, to have a stronger position in the selected investment banking products and to enhance the realization of broader and more intensive cooperation of the top officials. Another strategy that the management of the organization intends to undertake in the future involves developing a market leader in electronic commerce in the banking sector that can ensure that activities of the organization are carried out in an efficient manner. The management of Commerzerbank aims at ensuring it develops international banking services that are beyond the European border and the allocation of equity capital that can be used to reflect on the growth potential of the business areas (Teledata 2005). Current positioning of the Commerzbank in the banking industry The banks current positioning in the industry is that it has improved performance over the last financial year. The use of advanced technologies has enabled it to ensure it provide the right services to the customers at the right time. It also has adequate capital levels and equity that can enable it face the financial crisis facing countries such as the credit crunch. The management's implementation of different kinds of information technology systems has enabled them to serve their clients in a cost effective manner (Walldorf & Frankfurt 2008). It has positioned itself in providing investment banking services that are proved to generate profits for the organization. The management of the bank has resulted in merging with other corporate businesses in order to increase the level of operation in the banking sector. Commerzbank has constantly had close ties with its clients and this has led to improved performance of the bank .It has also lend finances to other different corporations in order to generate revenue in form interest from loans that can sustain operations of the company and to meet the needs of the small and medium enterprises (Meel 2000, p.182). Conclusion Organizations should set up proper strategies aimed at ensuring enough finances are availed for running the affairs of the organization in an effective manner. It has been noted that if strategic analysis is not carried out effectively, it may lead to organizations missing out on opportunities and may risk being left behind in terms of its growth and development. The managers of an organization should understand the market, costs and capabilities that would ensure that development strategies are implemented in an appropriate manner. It is also important for the banks officials to conduct a Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis to determine its competitive edge over its competitors. Organizations should implement systems that are appropriate in order to maximize as much revenue as possible and reduce costs that may hinder the growth and development of an organization. Commerzbank has proposed the following changes in its systems, proceses, culture, resource base, activity system and product offering. The management of the bank stated that it would use the System Application Program (SAP) software to manage all the operations of the organization so as to serve all its customers in an efficient way. It also intends to use licensed software that is aimed at reducing the development costs and deployment times that hinder an organization from achieving its goals and objectives within the specified period of time. HiPath is a system whose applications are centralized and reduce costs incurred when running operations of the organization .For instance where the HiPath is used then each employee accesses a voice message system that does not require them to use technology, which will eventually reduce the cost of running the activities as well as increasing the rate of efficiency within the organization. The management of the company intends to provide maintain a good culture through providing an environment in which the employee can carry out their activities in order to inspire and motivate them to perform their activities in the right way. The key values that have been enforced in order to ensure that the culture of the company is maintained includes; market orientation,intergrity,good performance, mutual respect as well as promotion of team work within the organization. The proposed changes that the bank intends to implement in the future that relates to its resource base is that its intends to use an Alpha server and storage works data warehouse whose functions are to store and retrieve data that may enhance proper decision making so as to meet the needs of the users within the specified period of time. Data mining technologies are being implemented so that internal corporate needs of the organization are met. The management of the organization has stated that it will implement new investment products such as hedge funds that will increase revenue to the company thus enhance the growth and development within the country. The banks business and information technology processes have improved over the last years due to the provision of nGenius solution, application of security policy and quality assurance policy. The importance's of the applications involves the identification any certified and uncertified applications since the uncertified applications may interfere with the services of the certified applications. NGenius solution has enables the managers to focus on key business activities that can improve on the performance of the organization. For instance alarms are set to handle key revenue generating applications whose slowdowns are checked so that they do not affect the performance of the organization. References Binder, G 2006, 101 of the world's tallest buildings, Images Publishing, United States of America. Cameron, K S & Quinn R E 2005, Diagnosing and changing organizational culture: based on The competing values framework, Edition: revised, John Wiley and Sons, United States Of America. Grant, R M 2005, Contemporary strategy analysis: concepts, techniques, applications Edition: 5 revised, Blackwell Publishing, United States of America. Laurentis, G D 2005, Strategy and organization of corporate banking edition, Springer, United States of America. Meel, J 2000, The European office: office design and national context, 010 Publishers, Germany. . McLean, G N 2006, Organization development: principles, processes, performance Edition: Berrett-Koehler Publishers, United States of America. Network Engineer Commerzbank, 2008, Commerzbank on Net scout Systems, Net Scout's NGenius Solution .Website retrieved on March 17, 2009. Read More