Quản trị chiến lược tại ngân hàng cổ phần thương mại SHB – thực tế và giải pháp

LUẬN VĂN THẠC SĨ – MBA Quản trị Chiến lược Ngân hàng cổ phần Thương mại SHB – Thực tế giải pháp THESIS MBA STRATEGIC MANAGEMENT IN SAI GON-HA NOI COMMERCIAL JOINT STOCK BANK – REALITY AND SOLUTION” FOREWORD Rationale Viet Nam has been integrating comprehensively into regional and internatiional market in all fields of economy in general and in financial and banking aspects in particular Intergation both creates opportunities and poses challenges for Vietnamese enterprises In this trend, being one of key financial agents of economy, banks are well aware the importance of systematic management works Therefore, strategic management is one of the most important tasks of all banks However, strategic management is a difficult, complicated task in which a small mistake can lead to bankruptcy no matter how internal strength of banks Sai Gon – Ha Noi Bank (SHB) is a newly founded bank that has turned rural share into urban one and is in the way of building brand mark, finding strategy to dominate the market in term of modern banking Its basic conditions of capital, banking technology, manpower, management experience are still in low profile These conditions are posing difficulty for strategic management and requiring strategic measures for Sai Gon – Ha Noi bank Basing on such reality, Group No.8 has decided to research on: “ Aims of the study - Study theory of strategic management of commercial bank - Analyze reality of strategic management in Sai Gon – Ha Noi commercial joint stock Bank - Propose solutions and measures in order to improve strategic management in Sai Gon – Ha Noi commercial joint stock bank Objectives and scope of the study - Objectives of the study: To study real issues in strategic management in Sai Gon – Ha Noi commercial joint stock Bank - Scope of the study: + Place: In Sai Gon – Ha Noi commercial joint stock Bank + Time: From 2006 to 2008 and in early months of 2009 Methods of the study Methods of specific and real problem solution: Statitics method, Analysis, Comparision, systemation, combination of theory and practice Structure of the study: The study consists of chapters: Chapter 1: Basic theory about strategic management of commercial bank Chapter 2: Reality of strategic management in Sai Gon – Ha Noi commercial joint stock Bank Chapter 3: Solutions to improve strategic management in Sai Gon – Ha Noi commercial joint stock Bank CONTENT CHAPTER .9 BASIC ISSUES ON STRATEGIC MANAGEMENT OF COMMERCIAL BANK 1.1 Commercial bank and necesarity of stategic management in commercial bank .9 1.1.1 Generalization of commercial bank .9 1.1.1.1 Definition of commercial bank 1.1.1.2 Activities charateristics of commercial bank .10 1.1.2 Necessity of strategic management of commercial bank 11 1.1.2.1 Definition of commercial bank stategic management 11 1.2 Basic contents of strategic management 15 1.2.1 Defining missions and strategic business objectives 15 1.2.1.1 Defining business missions 15 1.2.1.2 Building business strategic objectives 17 1.2.2 Analysis of outside business environment 19 1.2.2.1 Analysis of marcro environment 19 1.2.2.2 Analysis of micro environment 19 1.2.2.3 Determination of opportunity and challenge 20 1.2.3.International environmental analysis 20 1.2.3.1 Financial resource analysis 20 1.2.3.2 Marketing-PR capacity analysis 21 1.2.3.3 Analysing resources .21 1.2.3.4 Analaysing organization skill .22 1.2.3.5 Materials 22 1.2.3.6 Defining strenths and weaknesses 22 1.2.4 Establishing business strategy 23 1.2.4.1 Suggesting assignment 23 1.2.4.2 Strategic analysis 24 1.2.4.3 Choosing strategy 24 1.2.5 Implementing business strategy 25 1.2.5.1 Establishing annual target 25 1.2.5.2 Building polices 26 1.2.5.3 Construction of operation programs 27 1.2.5.4 Resource distribution 27 1.2.5.5 Deployment of policy execution 28 1.2.6 Examination and adjustment of business policy 28 1.2.6.1 Purpose of policy examination amd evaluation 29 1.2.6.2 Procedure of policy examination 30 1.3 Experience in policy management in some domestic and international trading banks 31 1.3.1 Experience in policy management in some domestic and international trading banks 1.3.1.1 Experience in policy management in some domesticl trading banks 37 1.3.1.2 Experience in strategic administration in foreign bank .40 1.3.2 Experience lesson about strategy administration 42 CHAPTER 43 CURRENT SISTUATION OF STRATEGIC MANAGEMENT ……………………… 43 AT SAIGON – HANOI COMMERCIAL JOINT STOCK BANK ………………………….43 2.1 Overview about Saigon – Hanoi Commercial Joint Stock Bank ……………… …….43 2.1.1 Establishment and Development of the bank …………………………………… 43 2.1.2 Organizational structure of Saigon-Hanoi Commercial Joint Stock Bank 44 2.1.3 Main activities of Saigon-Hanoi Commercial Joint Stock Bank 45 2.1.3.1 Operation and Management …………………………………………………….45 2.1.3.2 Risk management activities…………………………………………… 45 2.1.3.3 Capital Mobilization activities………………………………………………… 45 2.1.3.4 Credit activities 47 2.1.3.5 Other business activities………………………………………………… …….48 2.1.3.6 Other activities 49 2.1.4 Financial situation of Saigon – Hanoi Commercial Joint Stock Banks during 2006-2008…… 49 2.1.4.1 Charter capital 49 2.1.4.2 Business results……………………………… ……………………….50 2.2 Current situation of Strategic Management at Saigon – Hanoi Commercial Joint Stock Bank 50 2.2.1 Define the business mission and strategies……………………………………… 50 2.2.1.1 Content of business mission of SHB ……………………………………………50 2.2.1.2 Evaluation on bussiness mission and strategies of SHB 51 2.2.2 Evaluation on the environment analysis at SHB………………………….…………53 2.2.2.1 Environment analysis ….………….………………………… ……………… 53 2.2.2.2 Evaluation on environment analysis of SHB…………………………………….71 2.2.3 Evaluating existing status of strategic plan in SHB……….… ……….…….72 2.2.4 Evaluation on the strategy deployment at SHB………………………………………72 2.2.4.1 Evaluation on existing business policies…………………………………… … 72 2.2.4.2 Evaluation on setting annual objectives………………………………………….73 2.2.4.3 Evaluations on action plans………………………………………… ………….74 2.2.4.4 Evaluation on resources allocation during implementation………………………74 2.2.5 Evaluation on the checking and adjustment of strategy at SHB………….………….75 2.2.5.1 Content and criteria for strategy evaluation at SHB…………………………… 75 2.2.5.2 Evaluation on the checking and adjustment of strategy at SHB…………………76 2.3 Evaluation on the current situation of strategic management at SHB …………………… 77 2.3.1 Achievements 77 2.3.2 Shortcomings and reasons 77 2.3.2.1 Shortcomings 77 2.3.2.2 Reasons for shortcomings .79 CHAPTER 82 THE SOLUTION FOR IMPROVING STRATEGIC MANAGEMENT IN THE SAI GON – HANOI JOINT STOCK COMMERCIAL BANK 82 3.1 The strategic management direction in Sai Gon – Hanoi Joint Stock Commercial Bank in the integration era 82 3.1.1 The strategic management direction in banking industry .82 3.1.2 The developing strategic direction of SHB in the next time 83 3.2 The solution in improving the strategic management in SHB 85 3.2.1.Preparing the prerequisite conditions in performing sucessful strategic management 85 3.2.2 Primary solution group .86 3.2.2.1 Solutions for strategic planning 86 3.2.2.2 Solutions for strategy implementation 94 3.2.2.3 Overall solution for the checking work and strategic adjustment 97 3.2.3 Solution supporting group 100 3.2.3.1 Improve the financial strength 100 3.2.3.2 Improving human resources’ quality 100 3.2.3.3 Innovating technology and improve the quality of information and communication system in bank 104 3.2.3.4 Building banking culture 104 3.2.3.5 Consolidating the organization 105 3.3 Suggestions 105 3.3.1.Suggestions to the State Bank 105 3.3.1.1 Complete all the managing mechanism for banking operation 105 3.3.1.2 State bank enhances its role as the force planning the developing targets for banking industry 106 3.3.1.3 The State Bank upholds its role in encouraging, controlling, contributing to complete the administration system and operate the administration system 106 CONCLUSION 109 REFERENCE LIST 110 CHAPTER BASIC ISSUES ON STRATEGIC MANAGEMENT OF COMMERCIAL BANK 1.1 Commercial bank and neccessarity of strategic management in commercial bank 1.1.1 Generalization of commercial bank 1.1.1.1 Definition of commercial bank There are many definitions about bank One of these is the definition in Commercial Bank management by Peter S Rose: Bank is one type of financial organization providing lists of various financial service – particularly credit, saving and payment sevice – and implementing much more financial functions in comparision with other business organizations in economy In Vietnam, definition of bank is specified in Law of Credit banker in 1997 which was supplemented and admended in 2004 as follows: “Bank is one type of credit organizations that performs banking functions and other relevant business activities According to characteristics, aims of activities, banks include: Commercial bank, development bank, Investment bank, Co-operation bank, and other types of bank ” In these above types of banks, Commercial bank are overwhelming in fields of capital scale, market share, and quantity Pursuant to Decree No.49/2000/ ND-CP on 12th September 2000 issued by Government about organization and activity of commercial bank, Commercial bank is type of bank that perform all banking and other business activities, Commercial bank is bank that performs banking functioons and other business activities for sake of benefit, in order to implement State’s economic targets In which, banking activities are: money business activities and banking sevices with regular content of recieving money and using that amount of money for loan and payment services Activities of commercial bank include aspects: debt operation (capital mobolization), loan operation (loaning, investment, business services) and agent operation (payment, agent, consultant, information, document and precious objects keeping, etc.) These operations has closed relations, supports each other for muatual development in order to create reputation for a bank 1.1.1.2 Activities charateristics of commercial bank Being a financial agent, commercial bank is an enterprise because it has its own capital, trading activities, expenditure and activities for benifitcal purpose Commercial bank, however, is an enterprises with its own natures as follows: Fisrt, activities of commercial bank are activities in doing business in money, bullion, securities, etc and supplying banking services according to laws • Business activities of commercial bank are based on the basis of “borrowing” for “lending” through its own credit operations or in other word, the nature of commercial bank activities is to purchase “right of monay use” for selling “right of money use” to others • Commercial bank does not doing business in money by its own capital , but by money of depositors through its role as a credit agent for investors and hoarders • In order to buy “right of money use” in specific period, commercial bank must pay specific amount of money for the capital owner (interest rate of fund rasing) and when it sells right of money use, it also receives an amount of money which is called (interest rate of loan) Therefore, in activities of a commercial bank, interest rate is the price of loan use right Similar to other kinds of business, capital mobilization and loan have an important role, deciding success or failure of banks in particular and of an economy in general Second, products of commercial bank are immaterial and invisible Service supply is relatively dependent on customers Products of commercial bank will be generated when customers diliver following documents to bank: Letter of account opening, thier authorization from trading and credit contract in or der to fullfil any financial duty Thus passive and independent characters of bank are significant Third, relations between bank and customers (depositors and loaners) is in the basis of mutual trust and benefit “To business in banking is to business of happiness ” In the relations between bank and customers, borrowing and lending activities are the transference of “rights of money use” in which bank just purchases or sells “using value of money”, so when commitment of usage ends in terms of time, money will return without changing in value and difference (if available) according to commitment is interest rate Moreover, price of purchasing or selling – interest rate of deposit and loan- of money use right is very little in comparision with value of loan, so that compensation for risk if happens is little, too Therefore, confidence in banking activities is significant and in the first prioirty Regarding confidence, we refer to faithfulness and honesty that mean determination of loand paying of borrower as well as capacity of them in thier carrier activities Fourth, activities of commercial bank is risky ans sensitive to market, therefore, commercial bank is subject to strict supervision and management of State through State banking system at provincal level Commercial banks need to perform measures to ensure operating activities such as: to maintain specific capital for paying, to have capacity in order to cope with market changes, to choose trustful customers, to balance capital, to supervise operation, to diversify property for minimize risks; to use time economical market or market of debt instrument selecting and cross-exhange of interest rate in order to minimize risks of interest rate and exchange rate, etc 1.1.2 Necessity of strategic management of commercial bank 1.1.2.1 Definition of commercial bank stategic management a Definition of commercial bank strategy There are many different definitions of business strategy in gernaral and bank business strategy in particular In general, bank business strategy can be difined as follows: “Business strategy of a bank is a comprehensive and long-term activities program so as to create long lap of a bank, a committment to implement basic and comprehensive targets of a bank and the allocation of important resources so as to achieve these target in activities environment in the future.” * Term “Stategy” contains the following content: First, strategy is a kind of long-term directive plan in different levels or in general or in grass root level or in functional activity level Second, strategy is not an unchanged long-term plan but a flexible and adjustable one depending on conditions of business environment Thus, analysis and forcast of the business environment is an important basis to plan strategy Furthermore, resources factors should also be paid carefully attention to give out goo strategies that are suitable with business environment and adjustable Third, business strategies are not amorphous direction but they are aimed at specific targets which reflect general results of business progress that a bank may achive in the future * Role of business strategy in activities of commercial bank First: Defining long-term direction of activities for bank Second: Providing manager of banks a framework for intellectual guidance and activities in short term and long term (prequisite for implementation of basic functions in each level of management) Third: Providing solid foundation for making decisions and plans in business b Definition of commercial bank strategic management Ensuring the directive position of strategy for business activities of a bank effectively and flexibly is an important task pf bank managers Tasks of bank managers include organization and supervision of strategy management It can be said that contents of strategic management has clarified relations between bank and business environment It is the process of finding answers for such questions: Where is the bank in the market? Where should the bank be in the future? What are targets, images of the bank in the future? How will bank managers allocate resources to achieve these targets? How to recognize and ensure rgar bank should achieve desired position and image in the future? In general, definition of strategic management can be specified as follows: “Business strategic management is the process of analyzing present environment, predicting business future environment, defining missions, targets and strategic program;implementing, supervising, evaluating strategic programs and target in reality” Strategic management is not only a science but also an art of organizing, implementing and evaluating decisions relevant to function activities of bank on the basis of combination of these activities (marketing, manpower, supply of banking service, finance, budget, development research, etc.) so as to allow banks to effectively fullfil their business targets χ Model of strategic management Diagram 1.1: Model of strategic management procedures Developi ng domestic Streng th & weakn essyếu business environ ment Defining mission, environment of bank Revie wing target Developi ng outside Plannin g strategy business evironm entenvir onment PT Mtr KD bên Implem enting bussine ss Check & adjust strateg yy Opport unity/C hallenge Implement ation Construc tion Check and adjustment 1.1.2.2.Necessity of strategic management What are the role of strategy and strategic management to success of a bank? It is the question for all banks In order to understand role of strategic management, it is necessary to understand strengths and weaknesses of strategic management in implementation process α Strengths First, to assist executive managers and employee in banks to recognize aims and direction of their business activities Therefore, strategic management will encourage both managers and employees to achieve better achievements to improve benefits of banks Second, strategic management is the basis to define future image of bank It means that the forcast of bank position in comparision with other competitive banks Third, strategic management helps banks actively find out and obtain potential opportunities as well as avoid risks to enhance benefit chances and minimize risks in changing business environment Fourth, process of strategic management motivates innovation: if strategic managers want to achieve high efficency in management, they must adjust or change old methods of management by the more suitable ones b Weaknesses In addition, strategic management also has some weaknesses 10 SHB should differentiate the differences among regulation and policy in order to aware the necessity in building business policy In order to build sufficient and assembling policy system, it is neccessary for SHB to carry out some solutions as following: Firstly: Investing in suitable time, materials and human resources for building the business policy system for the bank in each business period and attach with the stratgic target Secondly, establishing the Board of making policies including the core managers from all the departemnts in the Head Offices, ALCO Council, Branch directors to give out the overall business policies, this Board can exist under the subcommittee directly under the Developing strategic board The policy building not only há the participation of superior staff but employee also can give their own opinion to upgrading the reality and optimal character of the business policy Thirdly, the business policy has to be buils in the multi levels: including head office level, branch level, department level The Head office give out the general policy, branches give out the suitable policy with the business environment condition in the operationg region basing on the general policy of the head office and small levels So, the business policies will be in deep and alive to each employee to carry out This is especially meaningful for the policies relating closely to the business environment characteristics like customer policy, policies on supplying product and services and so on Suggesting the procedure from draft to the time issuing the policy, this step is carried in the following way: Table 3.1: Suggesting the procedure in policy building 84 Draft board Drafting business policy All staff Amend, supplement and completing draft Contribute ideas for draft Complete policy Submit Policy Board for approval Managem ent Board Issuing policy b Building annual target on time and correctly Firstly, the annual target needs to be defined on time and considered as the goal in each financial year It is necessary to issue the strict treatment regulations for the violation in the limited time and content in order to improve the awareness as well as responsibilities in building targets Secondly, It is necessary to establish a system of all the register sample for annual plan in logic and scientific way for the quantity target for operation revenue, total asset, and financial indicator, at the same time, require the units who have specifications for these indicator Thirdly, targets have to ensure the requirements about the truth in the case that unit makes plan as only for coping with general policy Fourthly, it is necessary to have clear reward – penalty regime for carrying out the target and plan to increase the responsibilities in building the annual targets in units and department c Building the overall and systematic action program SHB’s current action programs are directed to the capital mobilization, the other aspects like credit, international payment, Banking card services, guarantee, financial consulting are nearly left open In order to recover the above unbalance, SHB needs to: Firstly, building the action program system in all bank’s operation aspects 85 Secondly, building the action program in tree shape Firstly, building the overall program, and then give out the specific and detailed action program Prevent the action plan is given overlap done to save resources and increase efficiency 3.2.2.3 Overall solution for the checking work and strategic adjustment a Completing the strategic content Building the specific strategic checking content outside the overall content, this content is drafted and submitted for approval in docmuments by the Strategic Board b Standardizing checking standard Similar to the strategic checking content, the standard system should be issued in documents to be as the basis to check all the activities with the strategic targets in bank; For the quantity target, the checking standard is the quantity value which is located with that target For the quality target: builing survey for staff and customer to evaluate the quality target as the correctivity of the strategic strategy, policies and the efficiencies in the action program, banking service quality and competitive advantages and so on c Timely, exact and objective improvement in measure and result comparision In order to have the timely and exact performance, SHB should to ensure the enough information for sufficien and standard measure: the information system has to be sufficient, complete and exact and credit Information has to be meaningful in strategy, it is necessary to be able to show the trends; Timely and should generate enough; type of information must be simple and suitable to each subject, especially for questions test strategies for clients and staff In order to satisfy all above standards, SHB needs to carry out all the following methods: Firstly, establishing the regulations on report which regulate report type, report standard, limit time and the performance provision, Secondly, establishing the secret control group and consider it as the supporter for Strategic Board to collect administrtion information which are all credit and timely This secrect control group can play the role as the customers to be served, questioned and checked Many banks has applied efficiently the secret control model This will ensure the continuous procedure in labor regulation, the customer serving behavior, 86 professional knowledge, supervising attitudes and the customer’s satisfactory level when they have transaction with the bank and so on Thirdly: It is necessary to build the survey in order to define strengths, restrictions in the quality management system, ensure the objective, complete and exact characteristic in checking result and comparision Checking the overall stratey in testing strategic system so after publicing all the information in the strategic management procedure including: announcing the historical vision, strategic target, name chasing targets, policies, action programs and so on, it is neccesary to evaluate all the current strategic management system via survey for staff in various level basing on the position and resposibility The thesis would like to suggest the following ten survey questions: Table 3.4: Questionnare about the efficiencies of the current strategic management system How can the SHB’ s current strategic management help you in work? Whether the SHB’s current strategic management system supplies the action directed information? According to your opinion? It fails or succeeds in which scope? Do you consider that SHB’s current administration attaches with the expenses and profit, in what section, does expense rise too high? Do you feel satisfied when working in the current strategic management system in SHB or not? That system has paid attention to the overall system in your demand or not? If have or not? At what point? Is the SHB’s current strategic management flexible? Or lack of flexibility in what point? Or how should change to ensure the flexibility in the system? What information you have to supply for the strategic management system? According to your opinion? What is the importance of these information for the strategic management system? Is SHB’s current strategic management system carried out in the normal way? Which period are you in? Have you done your job good? If yes/no? Why? Is the strategic management system update timely? Any shortcoming? Are the security and credit of the modern strategic management information information ensureed? Is there any innovation? How are they? 10 Your other ideas about strategic management system in SHB This questionaire system is more specific in each procedure in administration procedure and the people who are asked to receive the best answer 87 d Solution to complete the analysing work in reason and error adjustment After measuring the achived results with the checking standards, when having the errors, it is necessary to find the reasons The perfect solutions for analysing error reasons can be: Firstly, the error analysing has to be performed in each section (dispersion) to ensure the specific details Requiring each section in the strategic management system to analysing the error in the achived result with the initial plan In this step, units have to apply all the techniques in analysing environment to find out the error reason, it is necessary to answer all the following questions: The planned targets are suitable with the current environmental conditions or not? Is there any difference in changes in the environmental condition or not? Are the organizational structure, system, resources suitable to archive the target or not? Are checking target suitable or not? Secondly, the analysing dispersion result in each section have to be collected in to system The developing and strategic board has to collect and evaluate the analysing results from departments and then collect error result This will ensure the overall and objective character in the analysing result Thirdly, the strategic board needs to organize all the adjustment timely and define the error reasons in order avoid the loss in update information because the business environment in SHB, in country, region and the world changes continuously 3.2.3 Solution supporting group Beside the above primary solution, the following supports are indispensable in completing the SHB’s strategic management system: 3.2.3.1 Improve the financial strength Strengthening finance and the financial capacity’s improvement is considered as the important task of SHB at this moment In order to archive the target in finance and the security percentage on minimum capital 15 – 20%, the overdue debt percentage is -2 % total accounting outstanding, at first, SHB needs to concentrate to solve the following financial problems: 88 Firstly, solving fast and finising at a given moment all the bed debts and clear the asste summary table SHB’s bad debt at the time December 31, 2008 is about 2% lower than the banking industry’s average bad debt (about 7% account outstanding) In the next time, the rise in overdue debts can not be indispensable, because the credit staff’s knowledge is low so there are also some lack in lending control In order to solve these problems, SHB needs: - Restructuring the overdue debt structure, real bad debt under 2% total account outstanding and investment - Establishing the Companies on managing debts and other asset directly under the bank in order to improve the efficiencies in control and supervising the credit, at the same time, having the useful methods to solve at the given moment the backlog debts - Building the progress’s control system for the due bad debt, training on the procedure in withdrawing the mortage asset It is neccessary to have standards in evaluating the real value of asset and supervising asset during all the mortage time and guarantee - Improving the credit quality, controlling before, in or after borrowing capital in the close way - Pushing the progress in establishing the provident fund to make good the risks in bad debts and ensure the capital security in bank Secondly, SHB needs to save and protect waste to minimize unnecessary expense, improve the efficiencies in capital in the difficult moment Thirdly, managing product items, diversifying all the investment portfolio in order to improve the profit percentage, minimize the risks in banking operation in the direction to increase the profit percentage from services and safe investment, reduce the profit percentage from credit activities Fourthly, increasing charter capital because charter capital is important internal force to carry out plans on mordernizing bank and developing system and so on The ways to increase the charter capital can be: 89 - Issuing more primary stock or converible debt instrument like bonds for the current shareholders, the issuing price can be equal or greater than the value; selling shares for strategic partners with higher price than value The difference will be givin in the surplus fund in order to increase the charter capital in the suitable time - Building the strategy in increasing capital from distributing the profit among banks as an important, long and solid solution, - Specially taking care of making fund for risk management This is an important way to help SHB saving capital in business, timely solving debts in problems, creating the stable foundation for bank in money business Fifthly, upholding the intenal control and investigation to find problems in finance soon and have timely solutions 3.2.3.2 Improving human resources’ quality The development of human resources to match the business requirements in the process of integration is now a serious problem SHB need strategies to develop human resources in the near future to have a streamlined staff, may be eligible to meet business requirements in the context of strong competition and many potential risks as today To this, SHB can be performed: Firstly, building and carrying out the training program and re-training staff, planning and consolidating all staff in SHB system in the light and efficient direction - At first, it is neccessary to train managing staff via advanced and professional training program so that they are qualified enough in managing in a modern bank - Checking employee in all banking system, classifying due to professional skill to appoint the mission in order to be suitable with their ability - Using suitable expense in order to carry out the training plan, training staff and improve professional skills in foreign language, law, marketing; arts in business, businesss communication All these skills help banking staff can improve their professional skills and thoughts in working 90 Secondly, creating conditions for officers to visit and study in advanced countries in the region and the world to learn from experience to help administrators building business strategies in accordance with actual conditions in backward country without the international NH grasp the modern technologies in the world to make "take the short cut" Thirdly, having a strategy to attract talent: Building a policy priority especially for the excellent professional staff, experts have experience in strategic management, to promote initiatives, improvements in the business Fourthly, building mechanism for recruiting banking managers who are professionally trained abroad or international banking governance, which promote the transfer of experience and know-how in banking in the world into the SHB Fifthly, resolutely handling appropriately with negative staff, making the wrong principles and provisions of SHB Requiring a strict regulation of the newly recruited staff have faith, just talented 3.2.3.3 Innovating technology and improve the quality of information and communication system in bank This is a forcable solution to carry out because of the weaknesses in the information technology system can not be lengthened any more if the bank wants to exist and develop in long term Improving the information and communication system is also a supplememnt method for the strategic management process, it is meaningful for all the steps in this process, it is meaningful for all the step in this procedure From this moment, superior administrator can receive feedbacks from staff, customers, shareholders, managing authorities, or even from the competitors and vice verse; so beside the strategic control standards, they can have correct information about strategic management in order to have suitable adjustment SHB should combine between direct approach including conference, meeting, direct populization or formal speech and so on with the indirect information via email, SMS, video and other communication means 91 3.2.3.4 Building banking culture Basing on the available culture, administrators have to have specific plans for investing in building SHB’s deep cuture Human being and culture is the most competitive factor, building banking culture is one of interesting job but it also takes time, strengths and materials In order to achive this goal, SHB needs to carry out: The first: building SHB’s culture, clearly stating the general principles of behavior for all members of SHB Selection of traditional day to enhance solidarity, to create working atmosphere warm, friendly, supporting and developing the festival of family birthdays in bank and so on The second, standardizing uniform transactions nationwide, should not change form uniform continuity over the years The third, standardization of identification including brand design table counters, greeting telephone exchange, in logo wall clocks, table listing rates, benches waiting for customers so uniformly across the system system The four, applying the principles of thorough communication with clients issued, these principles need to be propagated widely, and often even for those employees not directly NH customer transactions and special Special recruitment for new employees 3.2.3.5 Consolidating the organization SHB should consolodate the organizational structure in the light and efficient ways in order to ensure that the system can operate safely To achive this goal, SHB’s administrators need: The first, checking all the organizational structure in bank, and then having suitable adjustment, regulating all the functions and tasks of each professional department The second, regulating the maximum transaction offices directly under the branch level I in order to ensure the system security, rapidly recover the condition that one brance manage two much transactions as moment 92 3.3 Suggestions 3.3.1.Suggestions to the State Bank 3.3.1.1 Complete all the managing mechanism for banking operation The first, the State Bank should consider soon to erease, amend regulations, documents, procedures which have safeguard regime and discrimination among domestic banks (especially state-owned commercial bank and the joint stock commercial bank) This action’s purpose is to increase the competitive advantages of overall banking industry facing with the foreign bank’s competition This action should be taken at the same time with the Ministry of Finance, because some banking operation will receive the control from laws issued by this Ministry like tax law, annnoucing information when becoming the public company and so on The second, the State Bank can institutionalize the application of standards and international practice in the banking industry (CAMELS, BASEL) in administration reality and operation of all banks in Vietnam 3.3.1.2 State bank enhances its role as the force planning the developing targets for banking industry The suggestion relating to strategic development needs to be carried out in the short term, mid-term and long-term The State Bank is the main responsible authority in planning and implementing the banking industry’s strategies The first, the State Bank must quickly develop strategies on banking sector development in the near future towards safe, modern and international integration Banking sector strategy is the basis for the commercial banks to build shared development strategies of their own The target strategic industries should be more specific to avoid general targets The second, the State Bank should coordinate with the commercial banks to build a clear action plan to continue strengthening and fostering the group should be done to create conditions for the commercial bank group in building financial management capacity of the eligible dissolution or merger This contributes to stability and strengthening the competitiveness of the whole banking system 93 3.3.1.3 The State Bank upholds its role in encouraging, controlling, contributing to complete the administration system and operate the administration system The problems in administration and operation of administration system in the banking system are implemented by commercial banks However, the State Bank also plays important roles in creating conditions, and encouraging the implementation The thesis would like to suggest some suggestions as following: Firstly, the State Bank should issue regulations on the administration system in banking system and force commercial banks to apply all the international accounting standards Auditing all the accounting profession due to international standard will help in evaluating independently and exactly banking activities At the same time, this also helps commercial banks comparing the financial indicator of their own with foreign banks in more standardized ways Secondly, the State Bank should upgrade the information technology and communication system in order to support receiving and anlysing financial report, statistics so that banks can control efficiently from remote It is necessary to pay attention to upgrade information technology for Credit Information Center (CIC) for updating, because this system is very important for the State Bank in searching information At the same time, the State Bank also gives standards to the State Bank’s information system and has sanction for violations in information and report regime Thirdly, the State Bank has to innovate and upgrading the investigation efficiencies for the commercial bank’s operation The risk level in the Commercial bank’s operation increases together with the domestic or international competitiveness in banking sector To achive this goal, the State Bank needs: • Standardizing the investigator and staff group, improving the professional skills and ethnic • The investigation activities have to be implemented strictly due to the investigating procedure for the high efficiencies Discovering timely the bad signals via remote control by anlaysing changes in the bank’s managing procedure Conclusion of Chapter 3: These are solutions, suggestion in order to completing the strategic management in SHB For the solution system: Solutions need to be imolemented assembly by SHM In all 94 the mentioned solution, the solution in human resource development is considered the top important one and SHB should carry out at first and parallell with others solutions 95 CONCLUSION Strategic management plays important roles for any business and more important for commercial banks for their own characteristics However, commercial bank’s strategic management is so plentiful, diversified and sensitve, complicated and much more difficult for a young bank like SHB However, the target of this writting has completed succesful the planned goals and tasks Firstly, the writing has anlysed and explained as well as systematizing the primary problems about commercial bank’s strategic management Secondly, basing on the theoretical foundation about commercial bank’s strategic management, the writing has gone deeply, analysing financial data, other operation criteria and the current situation in the steps in strategic management procedure, from this point, evaluating the overall current situation in SHB’s strategic management Thirdly, the writing has given out the system of solutions and suggestion arising from the current situation in completing the SHB’s strategic management For the limited ability and time, the research topic is too wide, our group has tried best, not excluding some shortcomings So, we would like to receive the contribution from lecturers, classmates, banking managers for our further understanding In the researching process, Group would like to send great thanks to the care and contributions from teachers in Subject Group and managers in class as well classmates who all help us to finsih this thesis Respectfully thanks! 96 REFERENCE LIST Ho Dieu (2002), Banking Management, the Statistics Publisher Nguyen Du (2001), Banking Management, the Statistics Publisher Le The Gioi – Nguyen Thanh Liem – Tran Huu Hai (2007), Strategic Management, the Statistics Publisher PhD Nguyen Thanh Hoi (1999), Human resources management - the Statistics Publisher PhD Vu Trong Khai (Editor), Lam Ngoc Diep (1996), Company organization and administration, the Statistics Publisher Nguyen Van Tien (1999) Risk managment in banking business, the Statistics Publisher The State Bank (1999-2006), legal documents 1999 -2008 Ly Bang and Vien Ha Huy (Chinese author) (2004), Managing Quintessence – Labour and Social Publisher Nguyen Thu Huong (2001), The thesis for economic master – finance subject – Monetary circulation and credit “Solutions for improving the financial administration quality in Vietnam Bank for Industry and Commercial, Banking Academy” 10 Nguyen Thu Dung (2007), the thesis for Business Administration master “The application of CAMELS model in financial analysis in the non stated owned joint stock commercial banks in Vietnam”, Hanoi National University 11 Peter S Rose and M.University (2001), Commercial Bank Management 12 J.David Hunger & Thomas L.Wheelen (2001), Essentials of Strategic management 13 Sai Gon Joint Stock Commercial Bank – Hanoi, the Audit reports in 2006-2008 14 Sai Gon Joint Stock Commercial Bank – Hanoi, the summary administration report on business results in 2006-2008 15 Asia Joint Stock Commercial Bank, Sacombank, VIP bank, Techcombank, the Audit reports in 2007, 2008 17 Statistics Annual Publication – summary – 2008, the Statistics Publisher 18 Websites of the State Bank, Bank Association and Commercial banks 97 98 [...]... development of community Vision 2010 32 Techcombank is making endless efforts to be ranked as the top bank of Viet Nam in trust, quality and effectiveness d- Sai Gon – Hanoi Joint Stock Bank (SHB) With existing foundation and strength, SHB identifies its strategy to strive to the top, modern retail bank in Vietnam and a strong financial corporation by 2015 Target customers • Small and medium enterprises:... strategy Unlike other young banks (including SHB) those select inexpensive, low-quality Core Banking system, Lien Viet Bank developed a systematic technological investment strategy aiming at the objective of becoming the No 1 bank in Vietnam in term of modernization LienViet Bank bought Core Banking Flexcube from the world’s top financial service IT solution supplier – I-Flex Solutions If anyone read LienViet... commercial banks It is theoretical foundation for Vietnamese commercial banks in general and SHB in particular to make flexible application in strategy administration depending on their actual condition To make good application of above issues for strategy administration, this thesis shall study operation status in SHB, good points and weakness as well as reasons in following chapter 36 ... development rate, LienViet Bank is expected to achieve considerable progresses compared with medium-grade joint stock company and rise with seiner banks in joint stock bank sector including ACB, Sai Gon – Thuong Tin Bank in the near feature Extract from mission, vision announcement of some joint-stock bank: a-Maritime Joint-stock Bank (MSB): Strategic Vision: Maritime Bank strives to be the leading commercial... a long-standing bank with depth of construction and development history- Vietnam commercial bank; and the another is a newly-built bank with quite sufficient and methodical system of policy management – Lien Viet Trading Joint-Stock Bank 29 a Experiences in strategic management in Vietnam Commercial Bank The Bank always considered as leading one in banking industry in Vietnam is Vietnam commercial bank... Defining obstacle of policy adjusment Executing policy adjusment Reevaluati ng policy adjustment 1.3 Experience in policy management in some domestic and international trading banks For a young bank like SHB, experiences in policy management in some domestic and international trading banks are valuable lessons to apply flexibly to specific sondition in context of common environment of present and futural