building a new business model for vietnam bank

7/28/2019 Building a New Business Model for Vietnam Bank

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Building a New Business Model for Consumer &Small Medium Enterprise Division at Vietnam Bank

created by Amal Rifadly 1

ORGANIZATIONAL STRUCTURE BUSINESS DIVISION at BANK

When the banking companies will flourish , began focusing his attention on the

management of various product lines in various financial industry and decentralizedecision-making authority .

When the financial industry began to make acquisitions and develop new products

and different markets , the need to establish a new organizational structure that

consists of several divisions .

Micro Finance Division ( Consumer Finance ) Small and Medium Enterprises Division ( Working Capital Financing )

Each division can be operated independently under the direction of the head ofthe division that is responsible directly to the CEO , in a divisional organizational

structure , division head will develop a strategy for each division are:

The Micro Finance ( Consumer Finance ) The Financing of Small and Medium Enterprises ( Working Capital Financing )

In the face of competition between the different sections so that the strategies

will be different from the other parts .

At the divisional organization , each section would be a good place to train young

managers ( Junior ) , and is also a good place to develop your intuition and

enhance entrepreneurship initiatives in a number of centers of financial companies

( Bank / Corporate Finance ) .

As an illustration of divisional organizational structure to be built and developed as

follows :


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Advantages of divisional organizational structure functions built, among others: Coordination across functions becomes easier and faster Having flexibility in the structure of bank specialization in each division can be maintained Open more career opportunities Potential competition in the organization CEO routine expenses reduced so

as to have time for strategic decisions

In implementing the strategy of a model of the main tasks that should be done inthe implementation process are:

SUMMARY ROLE OF POSITION

HEAD DIVISION has the duty and responsibility of the entire system andoperational divisions running and leading a special section within the division aremanaged, and the coordination between the divisions for the purpose of businessmodels built passage and provide reports to the CEO job.

MAIN TASKS DIVISION HEAD

Build a model of retail financing business (consumer finance) and small andmedium enterprises (micro financing)

Coordinate marketing activities of financial services products, in order toachieve the target.

Formulate segmentation, targeting and positioning for financial servicesproducts in accordance with a predetermined strategy.


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Creating an extensive marketing network for financial services productsaccording to market conditions in each region.

Perform analysis and evaluation of credit marketing programs. Formulate promotional activities. Coordinate the activities of a feasibility study to assess new business

opportunities as well as business conduct customer satisfaction research.

Orientation on achievement and increase profits Addressing the financing risk to credit risk

Benchmarking activities in financial services products in order to improvethe performance of divis.

Identify government regulation that hamper business and business issues, inorder to set priorities for marketing strategy

Formulate Quality Objectives and Quality Procedures Unit Unit which is atranslation of the Quality Policy and Quality Objectives establishedcompany.

Division prepare activity reports correctly and on time.BUSINESS PLAN

Consistent serving and empowering low-income segments of society as well assmall to medium sized small business .

Develop a business that focuses on MASS MARKET service and empowerment,strategic steps that will be done is to create a plan and build consumer financebusiness units that are consumer and consumer financing for small andmedium businesses.

The business plan is focused on two core components , namely the empowermentof women and integrated financial program for a better future.

Initiatives in line with the Bank's financial inclusion Vietnam , the focus is todevelop the business division that is specifically designed to meet the bankingneeds of low-income segments of society as well as small and mediumenterprises , including for pre-prosperous productive society to gain access tobanking services, I designed a business model innovation tailored to the needsof the community.


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The segment not only need access to finance , but also training and mentoring toincrease capacity so that customers can grow their business in a sustainablemanner.

COMPATIBLE PRODUCT PORTFOLIO SEGMENT

Classification grouping customers based on the portfolio to be managedcollectively.

Optimize the profit obtained from all customers by offering a differentvalue proposition to different segments.

For obtaining identifying market profit opportunities in the future. MARKET SEGMENTATION (The process of dividing the market are more

homogeneous grouped and characteristics that will create a different valuein each customer group).

MARKET SEGMENTATION PROCESS

DISTRIBUTION MODEL

Application of marketing distribution mix of products and services on the Bank /finance companies ( Triangle Marketing ).

PRODUCT

Attributes that accompany the system, procedures and services that pay attentionto matters relating to the size, shape, and quality.

PRICE

Prices in products and services , in the form of counter performance in the form of


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interest rates , both for deposits and loan products , as well as fees for bankingservices.

PROMOTION

Promotional activities on products and services through advertising in massmedia , or television , the overall concept of promotional activities includeInterest Rate , Product Sales Promotion , Public Relations , Sales Trainning ,

Marketing Research & Development .

PLACE

Distribution channels Bank products and services , such as branch offices , whichdirectly provide products and services offered .

PEOPLE

Her personal approach dominant element of the ranks of the front office , backoffice up to the managerial level.

PROCESS

Systems and procedures covering the terms and conditions imposed by the Bank'sproducts and services .

Systems and procedures reflect an assessment of the service sooner or later , theuse of appropriate technology and excellent creativity required for a process thatis fast yet safe .

OPERATIONAL MODEL

The series of value chain activities for the company's operations in the bankingindustry that are specific to each activity the product gains some value .

Activities that provide value -added products products from total value added ofall common activity that categorizes the value -added of the primary organizationthat built the business includes the sale rate . Sales and marketing operations ,administrative infrastructure management , human resource management andmanagement technologist .

Costs and value drivers are identified for each value activity is divided into 2 types,namely :

1. PRIMARY ACTIVITYInbound logistics, activities associated with material handling before use.

Operations, activity of which is related to the processing of inputs intooutputs.

Outbound logistics, activities undertaken to deliver the product into thehands of consumers.


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Marketing and sales, activities associated with directing consumers to beinterested in buying the product .

Service, activities that maintain or increase the value of the product.

2. SUPPORT ACTIVITYProcurement, relating to the acquisition of inputs / resources .

Human Resources Management, HR settings ranging from recruitment ,compensation, and termination .

Technological Development, development tools, software , hardware ,procedures , products in the transformation of inputs into outputs.

Infrastructure, consisting of departemen-departemen/fungsi-fungsi(accounting , finance , planning and so on) that serve the needs of theorganization and bind the parts into a whole.

Retail business functions (Consumer finance consumer goods and smallmedium enterprises) which is focused on Research and Development,Product Design, Service, Production Process, Marketing & Sales of productsby providing loans to eligible consumers, Distribution Customer Service.

HUMAN RESOURCES

Human Resources Training Unit , which is responsible for the developmentand implementation of human resource development programs , includingManagement Development , Information Technology Development , DealerDevelopment , Human Resources Development .

Technological Development Infrastructure, Management InformationSystems, Accounting, Operations, Financial, Human Resources Department.

Electronic banking services Diversion, Delegated Authority and Service

Strategy 'from the Central Office to the branch office network .

Structure formation , Credit Service Center and Branch Service Center, sothat lending is more efficient and improve service and business analysis inthe branch office .

Infrastructure that was developed based on four main concepts thatstructure of reporting lines, forms a flat structure, a hierarchicalorganizational structure, and the structure of the Strategic Business Unit .

Internal Control, Internal Audit constructed, Compliance, Risk ManagementUnit Intranet for all branches .


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Risk Management as part of the risk management infrastructure.

Various committees namely Risk Mitigation , Corporate Governance , RiskManagement , Audit , Credit , Products , Assets and Liabilities.

Restucturing and Settlement, an independent committee with a specialunit handling problem loans.

Instutional Banking Group and Asset - Liability Management, As asupporter of the Bank's activities and treasury activities .

FINANCIAL MODEL

I attach sample financial model analysis in building products financing :

FINANCIAL MODEL

Summary

Year 1 Year 2 Year 3 Year 4 Year 5

PRODUCTIVITYSales Person 15 15 15 15 15

Total Customer Acquired 2.376 2.880 2.880 2.880 2.880Avg Customer Acquired / Mth 198 240 240 240 240

Total Disbursement 7.128 8.640 8.640 8.640 8.640

Avg Disbursement / Mth 594 720 720 720 720

BALANCE SHEETNumber of Customer 1.579 2.469 3.098 3.681 4.225

Outstanding Balance 4.936 7.302 7.882 8.127 8.259

PROFIT & LOSSMargin Income 1.752 4.622 5.595 5.875 6.000

FTP (360) (948) (1.148) (1.206) (1.231)

Net Margin Income 1.393 3.674 4.447 4.670 4.769

Fee Income 238 288 288 288 288

Total Income 1.630 3.962 4.735 4.958 5.057

Manpower Cost 1.541 1.541 1.541 1.541 1.541

Operational Cost 78 78 78 78 78

Total Cost 1.619 1.619 1.619 1.619 1.619

Profit Before Tax (82) 2.198 2.581 2.852 3.052

Profit After Tax (57) 1.539 1.806 1.997 2.136

NPL 1% 2% 3% 3% 4%

START MAKING PROFIT Yes 7 BULAN

BREAK EVEN POINT Yes 12 BULAN

BRANCH

building a new business model for vietnam bank

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