(Source: Vietcombank card center)
From the above analysis, we see that Vietcombank is currently the leading bank in card operation in Vietnam market, but most of activities of Vietcombank have the trend to decree. Only the operation of issuance of international card still remains stably so Vietcombank has to encounter with the risk to lose the position and sharemarket.
Therefore, if there is no good development strategy, Vietcombank will have risk to decree.
4.4. SWOT matrix
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
2006 2007 2008 2009
Sharemarket of international card payment Sharemarket of card use sales
Sharemarket of domestic card issuance Sharemarket of issuance of international card
SWOT MATRIX Strong point (S)
S1. Prestige in trademark of Vietcombank
S2. Experience in business operation
S3. Exclusive in Amex card trademark
S4. Be the bank with the biggest card acceptance unit net in Vietnam
S5. Advanced technology foundation
S6. The system capable to accept the most several of international card types
S7. The bank leads the online payment with the international and domestic card
S8. The first bank is successful in connecting with 3 biggest card transfer organizations (Smartlink, Banknetvn and VNBC)
S9. The bank has the leading sharemarket in issuance and payment of card
S10. The bank has the most card product in the market
Weak point (W)
W1. Cost policy for units which accept is not flexible
W2. Procedures of card issuance is not short
W3. Marketing operation of VCB is not active and flexible
W4. Number of human resource for card operation is not equal to the development speed of the card service
W5. Management of operation of ATM machines is not good
W6. The process of shortcoming handling, claim of the customer is not short, wasting time
W7. The personal customer information system of the bank is inadequate
Opportunity (O)
O1. Crowded and young population and improved educated people
O2. Stabilization in politics – society of Vietnam
O3. Continuous
development with high speed of Vietnam economy
Combine S - O O1,3,4 + S1,2,9,8
Develop more product diversifying
O2,3,4,6 + S4,8,10
Remain the leading position in the market in issuance and payment of card
O1,2,3,5 +S1,2,4,9,6
Combine W - O O4,5,6 + W4,5,6,7
Improve service quality and attach with customer with bank products
O4,5,6 + W2
Simplify procedures in card issuance
O4,5,6 +W1,3
international economy integration
O5. Legal documents in financial, bank field have been completed more and more.
O6. Information technology has been developed quickly .
Expand cooperation with international card organization to issue more new card types.
Work as agent for several international card organizations O 4,6 +S5,10
Strengthen modern technology investment to meet more and more demand of customer and increase competition capability with other banks.
O1,2,4,6 + S5,9,4
Open Pos net of payment for domestic card, focusing on uncompetitive payment fields (health, education, bridge, etc).
Expanding online payment service..
Compete in cost policy and improve marketing operation O1,4,6 + W4,7
Attract, train and educate development of human resource to meet development of the bank.
Standardize the filing system and update information of customer.
Strategy (T)
T1. Proportion of population using card is low.
T2. Inflation rate is high T3. Increase in competition pressure in bank field:
T4. Collection of ATM transaction fee meets obstacles.
.
T5. Criminal in
international credit card has trend to increase
T6. Technology link is the same
T7. Habit of using card is popular
T8. Loyalty of customer is
Combine S – T S1,3,4 + T3,9
Remain the exclusive position in card issuance and Amex card payment
S1,2 + T1,5,8
Continue to develop EMV standard chip card to ensure the safety and confidentiality of card products
T1,7,9 + S1,2,5,6,8
Remain the issuance
sharemarket, using and payment of card
T3,9 + S1,2,4
Focus in units which accept card with high sale, not dead units
Combine W – T T3,7,8 + W1,2,3,4,6
Innovate management work in order to make the best of management process to reduce operation cost
T2,3,8 + W2,4,5,6
Keep more than 4 million customers who use Connect 24 products of Vietcombank with the sale of more than 100,000 billion dongs/year. This is the noble property source of Vietcombank.
T9.Power of supplier is great
Develop value added service attached with card products in order to improve competition of card products.
SUMMARY
S – T Combination creates
FOCUS STRATEGY
Combination between S-O and S-T creates
DIFFERENTIATION STRATEGY Combination between W-O and S-O creates
DEVELOPMENT STRATEGY
W-T Combination creates
COST-LEADERSHIP STRATEGY
After combining SWOT Matrix, we suggest 4 strategies as follows:
Focus strategy (Strategy 1): Renovate managerial works in order to optimize the management process. Use all available resources with the aim of maintaining above 4 million clients who used card products of Vietcombank, holding the share-leading position of revenue on card issuance, revenue on card usage and revenue on card payment. Hold the exclusive position for Amex card.
Differentiation strategy (Strategy 2): Strengthen to invest in modern technology in order to satisfy higher and higher needs. Develop VAS, increase utilities, improve the quality of customer services with products of the bank.
Continue to develop EMV in order to ensure the safety and enhance the security for card products.
Development strategy (Strategy 3) : Diversify products in order to satisfy all clients. Expand and strengthen cooperation, act as agents for international card organizations with the aim of issuing more types of new cards. Widen POS network. Attract, train and cultivate human resources to meet the development demand of the bank. Standardize archive system and update customers’ details.
Cost-leadership strategy (Strategy 4): Cut down expenses
Select strategies according to weight method:
QSPM MATRIX
MAIN FACTORS Classify
Replaceable strategies
Basis of attractive points Differentiation
strategy
Cost-leadership strategy
SA TAS SA TAS
Internal factors
1. Prestigious on the market 4 4 16 4 16 Advantage
2. Modern technology basis 3 4 12 3 9 Advantage
3. Effective distribution channel system 3 4 12 3 9 Advantage
4. Rich products and services 3 4 12 3 9 Advantage
5. Always take the lead on card share 4 4 16 3 12 Advantage
6. Low Charter capital 2 2 4 2 4 Disadvantage
7. Low marketing efficiency 2 2 4 3 6 Disadvantage
8. Lack of human resources 2 2 4 1 2 Disadvantage
9. Low quality of banking products and services 2 2 4 1 2 Disadvantage
External factors
1. Political – social stability 4 3 12 3 12 Advantage
2. Ceaseless growth and high speed of the economy 4 3 12 3 12 Advantage 3. Globalization and international economic integration 3 3 9 3 9 Advantage 4. Legal documents in the field of finance, banking are
more and more perfect 3 3 9 3 9 Advantage
5. Population scale and structure is favorable for banking
services development 3 3 9 3 9 Advantage
6. IT develop very fast 3 3 9 3 9 Advantage
7. Perform international commitments in the field of
banking 3 3 9 2 6 Disadvantage
8. Competition between banks and financial institutions
is more and more severe 2 3 6 3 6 Disadvantage
9. Cash habit is still popular 2 3 6 3 6 Disadvantage
Total attractive points 165 147
MAIN FACTORS Classify
Replaceable strategies Basis of attractive
points Development
strategy Focus strategy
SA TAS SA TAS
Internal factors
1. Prestigious on the market 4 3 12 4 16 Advantage
2. Modern technology basis 3 3 9 4 12 Advantage
3. Effective distribution channel system 3 3 9 3 9 Advantage
4. Rich products and services 3 3 9 3 9 Advantage
5. Always take the lead on card share 4 3 12 4 16 Advantage
6. Low Charter capital 2 2 4 2 4 Disadvantage
7. Low marketing efficiency 2 2 4 2 4 Disadvantage
8. Lack of human resources 2 3 6 2 4 Disadvantage
9. Low quality of banking products and services 2 2 4 2 4 Disadvantage
External factors
1. Political – social stability 4 4 16 4 16 Advantage
2. Ceaseless growth and high speed of the economy 4 4 16 4 16 Advantage
3. Globalization and international economic integration 3 4 12 4 12 Advantage
4. Legal documents in the field of finance, banking are Advantage
5. Population scale and structure is favorable for banking
services development 3 3 9 3 9 Advantage
6. IT develop very fast 3 3 9 4 12 Advantage
7. Perform international commitments in the field of
banking 3 2 6 3 9 Advantage
8. Competition between banks and financial institutions
is more and more severe 2 2 4 2 4 Disadvantage
9. Cash habit is still popular 2 4 8 2 4 Disadvantage
Total attractive points 158 169
4.5. Select card business strategies of Vietcombank under QSPM Matrix:
Through the above table of QSPM Matrix, we find that the focus strategy (strategy 1) gets 169 points; the differentiation strategy (strategy 2) gets 165 points; the development strategy (strategy 3) gets 158 points; the cost-leadership strategy (strategy 4) gets 147 points. Due to human resource limit, the business can’t concurrently pursue many different strategies. In the viewpoint of our group, Vietcombank should select the most appropriate strategies in accordance with its condition in order to earn the highest economic efficiency. Based on achieved points from QSPM Matrix, our group suggests that Vietcombank should select 03 of 04 mentioned strategies; strategies are arranged under the following order of preference:
Focus strategy (Strategy 1): Renovate managerial works in order to optimize the management process. Use all available resources with the aim of maintaining above 4 million clients who used card products of Vietcombank, holding the share-leading position of revenue on card issuance, revenue on card usage and revenue on card payment. Hold the exclusive position for Amex card.
Differentiation strategy (Strategy 2): Strengthen to invest in modern technology in order to satisfy higher and higher needs. Develop VAS, increase utilities, improve the quality of customer services with products of the bank.
Continue to develop EMV in order to ensure the safety and enhance the security for card products.
Development strategy (Strategy 3) : Diversify products in order to satisfy all clients. Expand and strengthen cooperation, act as agents for international card organizations with the aim of issuing more types of new cards. Widen POS network. Attract, train and cultivate human resources to meet the development demand of the bank. Standardize archive system and update customers’ details.
Selecting 03 above strategies creates conditions for VCB to develop towards
“Sustainable, safe and effective”, our group thinks that this is the strategy in conformity with the strengths and weaknesses of Vietcombank and in conformity with the trend of the current age.