2. INTRODUCTION
• Industry : Finance (Banking)
• Time Period : 1999 – 2015 (After MAS - 1999 Liberalization formed)
• Business Model: Combination of B2B and B2C
• Competitors identified : DBS, UOB, and foreign banks
3. PESTEL
Description Opportunity /
Threats
Political 1999 Liberalization Program by MAS Opportunity / Threat
Economic Size denotes strength of Bank - Consolidation of local banks Opportunity / Threat
Socio-Cultural Change in educational level, income level and higher expectation of lifestyle Opportunity
Technological Technology advancement and new delivery channel Threat
Environmental n.a. n.a.
Legal Introduction of Basel Accord Opportunity / Threat
4. PORTER’S FIVE FORCES ANALYSIS
Explanation Threat Level
(High, Medium,
Low)
1st Force – Threat of New
Entrants
• Highly Regulated by Authority
• Economic of scale is crucial
• Limited differentiator in products and services deters entry
LOW
2nd Force – Threat of
Substitutes:
i.e. Singtel, AliPay
• Increasingly adoption of mode in payment for small ticket items
like through Singtel mobile and from non-financial company
MEDIUM
3rd Force – Power of Buyers
i.e. Individual consumers
• Low difference in products and services deters entry
• Low switching costs depending products acquired
HIGH
4th Force – Power of Suppliers
i.e. Mortgage deposit, loans
from other banks
• Low switching cost – depending on interests/payout offered
• Suppliers may decide if they want to work with OCBC; and if
OCBC depends on them, then high threat.
HIGH
5th Force – Competitive Rivalry • Generally the banks (local) are on par in terms of financial
strength and offers.
• Asia exceptional growth rate – encouraged foreign banks to
come into Singapore
HIGH
5. STRATEGIC CAPABILITIES
Strategic Capability Analysis
Bundled Resources + Competences = Strategic Capability
1. Technological
2. Organizational
3. Human Resources
4. Organizational Culture
Facilitate cross functional training for
efficiency and personal growth
Encouraged growth in across
functions within organization to
ensure efficiency and enable
reinforcement when needed
1. Technological
2. Financial
3. Innovation
4. Management and
Leadership
5. Organizational Culture
6. Reputation
Identify consumer’s needs before
they realized they require it
Ability to identify and grow new
market with cutting-edge solution
before anyone else
6. V.R.I.O
Strategic Capability VRIO Criteria Results
Valuable Rare Inimitable Organization Support
Encouraged growth in across
functions within organization
to ensure efficiency and
enable reinforcement when
needed
Y X - - COMPETITIVE
PARITY (CP)
Ability to identify and grow
new market with cutting-edge
solution before anyone else
Y Y Y Y Sustainable
Competitive
Advantage (SCA)
7. S.W.O.T
Explanation
Strengths • Ability to pre-empt market trends and keep up with relevant solutions to support the
market needs.
• Willing to invest into untapped market before getting profit or payback
• Stay constant relevant and willing to listen to their customers to understand what
they want
Weaknesses • Low level of differentiated products and services
Opportunities • Expansion internationally to emerging economic e.g. China and Myanmar
• Merger: financial portfolio also enable cross-selling hence increase coverage and
customer value
Threats • Political policy impact growth: Basel Requirement, 1999 Liberalization Program
8. ISSUES
• How can OCBC developed a products or services that is almost
impossible to imitate?
• How can OCBC gain market share with the increase in competition
from both financial industry and non-financial sectors
