The bank realized through the foresight of the CEO that the Gulf was on the tipping point of exceptional growth. An external strategy consultancy was called in to assist in identifying a new strategy.
At the time, the bank was a traditional consumer bank relying on branch relationships to build customer loyalty. Corporate banking contributed a small amount to overall revenues. Competition was mostly local.
The Bank was established in the mid 1970s as the first wholly owned private commercial bank in its country. Initially capitalized at USD 3 million, it has grown and prospered over the years to become an important regional bank. It now has capital and reserves of over USD 120 million and a total assets book of USD 1.5 billion. The Bank has been profitable every year since its foundation and has paid dividends annually. Today, it offers a comprehensive range of Corporate, Retail and Investment services through a network of 13 branches, 2 service offices and 33 ATMs.
Phase I Crafting Strategy: Strategy Consultancies Broad Recommendations
The recommendations included:
- Outlining segmented market as upper mass and high wealth
- Assisted in identifying strategic goals
- Set measures against the goals
- Introduced Performance Management Mechanism
- Developed a corporate-wide strategy
The External Challenge
- GDP growth was creating increase in demand for corporate bank products.
- GDP growth was attracting foreign banks, thus increasing the need to improve both product offerings and levels of service in order to remain competitive.
- The Central Bank was considering reducing local banks’ protection of the market.
- The stock market was going through tremendous growth.
- Consumer customers were increasingly demanding superior and more advanced products.