TABLE OF CONTENTS TABLE OF CONTENTS i INTRODUCTION 1 DISCUSSION 2 Should ANZ bank abandon the physical branch model and transition all its services online 2 INTRODUCTION This report provides a detaile. TABLE OF CONTENTSTABLE OF CONTENTSiINTRODUCTION1DISCUSSION2Should ANZ bank abandon the physical branch model and transition all its services online INTRODUCTIONThis report provides a detailed analysis of whether ANZ bank should abandon the physical branch model and transition all its baking services to an online model. To evaluate the question, factors such as the PEST analysis, SWOT analysis, and Porters five forces were conducted to assess the best decision for ANZ. After extensive research, it is concluded that ANZ should not fully transition into an online model but also maintain a physical branch for banking activities. I. PEST ANALYSIS AND MODELP1. Political stability in the existing markets – ANZ Banking Group operates in several countries, so policies must be developed following the industryspecific requirements of Regional Banks.2. Regulatory Practices – ANZ Banking Group must manage various regulations in various markets. In recent years, Australia and other emerging economies have changed market entry rules and how companies in Regional Banks can operate in the local market. (Barber, 2022)3. Taxation policies – ANZ Banking Group has benefited from lower taxation policies throughout the Western Hemisphere over the last two decades. It has resulted in increased profits and spending on research and development (Dondoni, 2020). 4. Armed Conflict – There are no imminent threats to Australia from business disruption caused by military policies, terrorist threats, or other political instability.E1. Inflation rate – Reserve Bank of Australia (RBA) on October 4 officially raised the introductory interest rate by 0.25%, touching the threshold of 2.6%, leading to Australias inflation rate in the second quarter of 2022 at 6.1. % is forecast to peak at 7.8% by the end of the fourth quarter (Sharp, 2022).2. The efficiency of Australian financial markets ANZ Banking Group can obtain vibrant financial markets and easy liquidity in Australias equity market to expand worldwide.3. Exchange rate – Australias volatile AUD exchange rate can impact ANZ Banking Groups investment plans and lead to some currency issues.4. Downward pressure on consumer spending Even though household disposable income increased by 5% between 2010 and 2020, thanks to temporary government income support, growing societal inequality will harm consumer sentiment and, thus, consumer spending (Sharp, 2022).S1. Media outlets – ANZ Banking Group can leverage the trend of both traditional media and social media to market better and position its products.2. Gender roles Because the average wage disparity between men and women in Australia was 14% in 2019, ANZ Banking Group can test various concepts to cater to and support these evolving gender roles in Australian society (Foster, 2022).3. Power structure Income inequality has risen sharply in most advanced economies worldwide since the 1970s and has been blamed for Australias persistent power structure.4. Migration 53% of white Australians have a negative attitude toward immigrants, making it difficult for ANZ Banking Group to gather international leaders and managers to manage operations (Cobbett, 2022).T1. Lowering production costs ANZ Banking Group must restructure its supply chain to increase flexibility to meet customers needs and cost structures in the financial sector.2. Technological innovation – The digital transformation of the supply chain began in 2010, but COVID19 has accelerated it, requiring ANZ to provide greater access to information to supply chain partners and broader players in the financial industry (Wallaker, 2022).3. Mobile development and dissemination To stay ahead of the competition, ANZ Banking Group must meet and manage financial expectations and innovate.4. The first mover in introducing innovations – ANZ was the first bank in Australia to launch an app that allows small businesses to manage their cash flow by securely processing sameday settlement of credit and debit card payments using an iPhone or iPad.
TABLE OF CONTENTS TABLE OF CONTENTS i INTRODUCTION DISCUSSION Should ANZ bank abandon the physical branch model and transition all its services online i INTRODUCTION This report provides a detailed analysis of whether ANZ bank should abandon the physical branch model and transition all its baking services to an online model To evaluate the question, factors such as the PEST analysis, SWOT analysis, and Porter's five forces were conducted to assess the best decision for ANZ After extensive research, it is concluded that ANZ should not fully transition into an online model but also maintain a physical branch for banking activities P I PEST ANALYSIS AND MODEL Political stability in the existing markets – ANZ Banking Group operates in several countries, so policies must be developed following the industry-specific requirements of Regional Banks Regulatory Practices – ANZ Banking Group must manage various regulations in various markets In recent years, Australia and other emerging economies have changed market entry rules and how companies in Regional Banks can operate in the local market (Barber, 2022) Taxation policies – ANZ Banking Group has benefited from lower taxation policies throughout the Western Hemisphere over the last two decades It has resulted in increased profits and spending on research and development (Dondoni, 2020) Armed Conflict – There are no imminent threats to Australia from business disruption caused by military policies, terrorist threats, or other political instability E Inflation rate – Reserve Bank of Australia (RBA) on October officially raised the introductory interest rate by 0.25%, touching the threshold of 2.6%, leading to Australia's inflation rate in the second quarter of 2022 at 6.1 % is forecast to peak at 7.8% by the end of the fourth quarter (Sharp, 2022) The efficiency of Australian financial markets - ANZ Banking Group can obtain vibrant financial markets and easy liquidity in Australia's equity market to expand worldwide Exchange rate – Australia's volatile AUD exchange rate can impact ANZ Banking Group's investment plans and lead to some currency issues Downward pressure on consumer spending - Even though household disposable income increased by 5% between 2010 and 2020, thanks to temporary government income support, growing societal inequality will harm consumer sentiment and, thus, consumer spending (Sharp, 2022) S Media outlets – ANZ Banking Group can leverage the trend of both traditional media and social media to market better and position its products Gender roles - Because the average wage disparity between men and women in Australia was 14% in 2019, ANZ Banking Group can test various concepts to cater to and support these evolving gender roles in Australian society (Foster, 2022) Power structure - Income inequality has risen sharply in most advanced economies worldwide since the 1970s and has been blamed for Australia's persistent power structure Migration - 53% of white Australians have a negative attitude toward immigrants, making it difficult for ANZ Banking Group to gather international leaders and managers to manage operations (Cobbett, 2022) T Lowering production costs -ANZ Banking Group must restructure its supply chain to increase flexibility to meet customers' needs and cost structures in the financial sector Technological innovation – The digital transformation of the supply chain began in 2010, but COVID-19 has accelerated it, requiring ANZ to provide greater access to information to supply chain partners and broader players in the financial industry (Wallaker, 2022) Mobile development and dissemination - To stay ahead of the competition, ANZ Banking Group must meet and manage financial expectations and innovate The first mover in introducing innovations – ANZ was the first bank in Australia to launch an app that allows small businesses to manage their cash flow by securely processing same-day settlement of credit and debit card payments using an iPhone or iPad S II SWOT ANALYSIS AND MODEL High margins – While Australia's so-called Big Four banks have been experiencing shrinking profit margins due to record-low interest rates, ANZ is still racking in higher profit margins than competitors (Mallin, 2022) Wide-ranging presence – ANZ Banking Group has an extensive dealer and associate network, which assists in providing efficient services to customers and managing competitive challenges in the Regional Banks industry Social acceptance – ANZ also has a dominant digital marketing strategy on various social media platforms, which helps build a close relationship with customers Diverse available services – ANZ has a diverse product portfolio that reduces the risks associated with ANZ bank operations and is suitable for online launch W Declining market share – Due to the company's slower revenue growth, ANZ Banking Group must carefully analyze the various trends within the Financial sector and determine what it needs to to drive future growth Inadequate investments in customer-oriented services – This may result in competitors gaining an advantage shortly Slow decision–making process, resulting in a more extended transition to an online model Reluctant to transition – Although ANZ's 'Career Extension' options allow older workers to keep working, they are hesitant to switch to an online model after following traditional banking methods O Significant technological investment – Technological advancement forces ANZ to adapt and improve its efficiency and effectiveness in conducting business Opportunities in the Online Space – As customers adopt more online services, ANZ Banking Group can provide new offerings to customers in the Regional Financial industry Increase customer base – Moving to an online model will lead to capturing more customers (Mark et al 2013) Financial market expansion – The ability to expand the financial market to remote locations via online databases T Skilled staff shortage – The company may face trained human resource challenges soon due to high employee turnover and an increasing reliance on innovative solutions Competitors' product development – Due to technological advancements, there is fierce competition among the top four banks in online banking (Mallin, 2022) High risk of data breaches – High level of cyber threats, potentially resulting in the loss of personal customer data Legal issues – Increased rate of illegal monetary activities as a result of widespread coverage Rivalry III PORTER'S FIVE FORCES ANZ faces stiff competition from a plethora of rivals Profitability in the banking industry is low as firms compete with aggressive targeting and pricing strategies (Said & Doll, 2021) Buyer power Buyers' bargaining power against ANZ grows as their customer base becomes more concentrated Customers' loyalty is low as a result of the competitive environment Customers expect high-quality goods and services for a low price Solution Building loyalty by incorporating innovation and providing an exceptional customer experience can increase switching costs ANZ should produce new niche markets to provide customers with customized products and services Substitutes Product and service differentiation is relatively low among banking organizations Other banks' substitute products and services are widely available Customers cannot obtain the same utility from a substitute product in terms of functionality and quality that they from ANZ's product Solution ANZ should clearly state how its offered goods and services are superior to the alternatives They should also improve the quality, maximize the value for money, and establish a strong differentiation basis to discourage customers from using a substitute product Entrants The regulatory framework challenges new firms seeking to enter the financial market Entry into the industry necessitates a large initial capital investment and significant resource investment Existing market players are fiercely competitive Solution To access the target market, ANZ should establish long-term contractual relationships with distributors Focusing on customer relationship management can foster brand loyalty Supplier power Switching from one supplier to another is inexpensive for buyers There is no threat of forwarding supplier integration Suppliers are not geographically concentrated, and their concentration is lower than that of buyers Solution ANZ can strengthen its position against suppliers by reducing its reliance on a single or a few suppliers The bank should investigate alternative production methods if the product demand is high enough and the firm has the necessary competencies and expertise 10 11 12 IV RECOMMENDATION According to the findings of the given analyses, ANZ Bank should not abandon the physical branch model and proceed with all of its services online Through the PEST analysis, the high inflation rate and fluctuations in the exchange rate between AUD and USD will stymie digital transformations Despite ANZ's extensive dealer network, the SWOT analysis highlights that the workers' reluctance to transition to an online model could lead to an employment shortage The critical point of Porter's five forces was maximizing value for money and establishing a solid differentiation basis to foster brand loyalty 13 REFERENCES Barber, W 2022, The Evolving Australian Labour Market | Speeches, viewed October, 2022, Cobbett, B 2022, Migration, Australia, 2019-20 financial year, viewed October, 2022, Dondoni, A 2020, "Selected Research Topics of the Dondoni Group over the Last Two Decades (2000–2020)", Synlett, vol 31, no 14, pp 1361-1371 Foster, L 2022, Australia's gender pay gap still 14%, with men earning $240 more a week than women, viewed October, 2022, Mallin, I 2022, Does ANZ really have the best profit margins of the big four bank shares?, viewed October, 2022, Mark, T, Lemon, K, Vandenbosch, M, Bulla, J & Maruotti, A 2013, "Capturing the Evolution of Customer–Firm Relationships: How Customers Become More (or Less) Valuable Over Time", Journal of Retailing, vol 89, no 3, pp 231-245 Said, K & Doll, Y 2021, "Strategies to Improve Financial Profitability in the Banking Industry", International Journal of Applied Management and Technology, vol 20, no Sharp, S 2022, Financial Stability Review – October 2022, viewed October, 2022, Wallaker, G 2022, Digital Transformation of the Supply Chain: Now and Next, viewed October, 2022, 14 ... whether ANZ bank should abandon the physical branch model and transition all its baking services to an online model To evaluate the question, factors such as the PEST analysis, SWOT analysis, and. .. should not abandon the physical branch model and proceed with all of its services online Through the PEST analysis, the high inflation rate and fluctuations in the exchange rate between AUD and USD... and quality that they from ANZ'' s product Solution ANZ should clearly state how its offered goods and services are superior to the alternatives They should also improve the quality, maximize the