Examine the Mission and Core Values of Tisco. Are They Clear and Appropriate? How Would You Improve Them?

1. Examine the mission and core values of TISCO. Are they clear and appropriate? How would you improve them? (10m)

Basically, TISCO has put in writing clearly defined statement outlining its mission and core values. As TISCO’s mission is dedicated to creating sustainable values for its customers, shareholders, people, and society it shows that TISCO is a quality growth organization with strong customer priority, committed to deliver value financial services with mastery, efficiently and professionalism. Creating sustainable values means that the Bank is also adheres to the cultures of integrity, fairness, and transparency in order to bring sustainable values to their customers, shareholders, people, and society.

TISCO has six core values which describes the sort of company is aspires to be that also shows their professional attitude and essence of their service offer to the customers. TISCO’s core values consist of:

1. Customer Priority: Customers are the primary focus. The Bank derives a professional and practical solution that fulfills the customers' requirements.

2. Integrity: Customers are assured of the unyielding commitment to ethical conduct, which is projected in all aspects of their undertakings.

3. Reliability: The quality of client relationship by infusing excellence and integrity into all dealings. Clients are offered the knowledge base and experience of their integrated resources. The measure of client progress and satisfaction is their base for evaluation.

4. Mastery: Serving the customers by constantly and progressively improving the abilities through a sustained passion for knowledge. Their people are trained to demonstrate exceptional skills and show the ability to lead others.

5. Creativity: Their expertise not only comes from in-depth knowledge, experience and know-how, but also comes from their own creativity.

6. Guidance: They are eager to play a role in guiding and advising customers, in order to help them manage finances.

Generally, both of their mission and core values are clearly and appropriate defined as it shows that they enjoy long term success. They are now is a leading player in wealth and asset management and has won various awards such as SET Award of Honor in the Top Corporate Governance Report Award 2013, Board of the Year 2013 from the Thai Institute of Directors Association as well as Thailand’s ministry of Finance Ratsadakorn-pipat Award for excellent tax and regulation compliance. Indeed, in increasingly competitive global environment, without a clear mission and vision, a business will lack direction and may not survive.

1. Do a SWOT analysis for TISCO. What are the key trends that need to be considered over the next three to five years? (25m)

Strength

TISCO has competent, professional and experienced management team. They are expert in managing their retail banking, corporate banking ,wealth and asset management and corporate affairs and corporate social responsibility. TISCO was the first company to offer stock reports and was among a select number of financial institution to receive the Asset Management License in 1992. Besides having skilled workforce, TISCO got well-diversed sources of income through its two main business; commercial banking and securities. TISCO has a very strong presence both in the region and in the industry as it a part of a huge conglomerate. It’s also known for its sustainable profitability, extensive branch networks and good asset quality which is supported by prudent risk management system. TISCO Group is also able to sustain the long term competitive position given long-term experience in hire purchase business, good relationship with car dealers, effective cost and risk management together with extensive customer database. Moreover, the company has won various awards such as SET Award of Honor in the Top Corporate Governance Report Award 2013,Board of the Year 2013 and Thailand’s Ministry of Finance Ratsadakorn-pipat Award for excellent tax and regulation compliance.

Weakness

TISCO is facing challenges on the intensifying competition in the banking and securities businesses as TISCO (consider themselves as a small player in bank industry) have to compete with the increasing number of local and foreign banks as well as giants bank such as Bangkok Bank,Siam Commercial Bank, Citibank, and HSBC. For retail banking, TISCO has a relatively narrow product ranged compared to competitors and it is as a fairly limited distribution network in the number of its ATMs and branches.

Opportunity

The modernization of business operation and increasing demand for sophisticated financial service provided bank with an opportunity to increase their fee-based income service. Besides, growing economy will also lead to a loan demand expansion which offers good opportunities for banking business expansion. For example, government’s mega project will allow TISCO to undertake loan syndication. Moreover, changes in Thai lifestyle will be the major force behind the immense needs for accommodation and personal consumption. This offer an opportunity to TISCO to broaden their consumer banking operation as well as creating new products.

Threat

The biggest threat for TISCO is to maintain and create stronger foundations for future growth as well as preparing to cope with economic uncertainty. TISCO is also faces issues such as competition between bank and non-bank and competition between foreign bank as foreign bank are also providing the same financial services and will capture and penetrate the market to certain extent as they capitalise on their advantages of lower cost of funds and better services and technology. The bank is also at risk to uncertainties in domestic political and global financial arenas that potentially affect the slowdown in domestic consumption, tax and cost structure. Besides, weak domestic car sales and high competition in automotive hire purchase loans could dampen the demand for loans. High level of household debt and rising cost of living also resulting in worsened asset quality of loan portfolio, particularly retail loan business. Other threats may faced by TISCO are increase in labour costs, price and tax changes and increasing rates of interest.

Key trends that need to be considered over the next three to five years

External business environments such as the economy, domestic and international politics and internal factors, such as strengths, weaknesses, opportunities, threats, critical success factors and priority issues play an important part in developing 3-5 year business plan. There are some key trends should be highlighted in order to achieve strategic planning successfully.

1. Balanced Scorecard technique, Key Performance Indicators and Performance Dashboard sessions should be constantly monitored and implemented across of level of staff. Staff who are always performs may be awarded fair compensation based on merit.
2. Enhance distribution channels and the marketing team as well as continually identify new business opportunities in niche markets in order to maximize customer reach. In addition, the Bank offers services and products totally based on clients’ needs, with an aim to maximize customers’ satisfaction.

1. Emphasize on quality product development to deliver the best solutions for clients, including enhance banking infrastructure and automate working process to support growth in business volume and service channels
2. Build corporate branding and preserve corporate image in order to widely promote TISCO Bank’s product and services as well as business synergy among companies in TISCO Group.
3. Focus on improving information technology, business decision support system and personnel development in order to shift efficiency in business operations and fully utilize the banking platform.

1. Taking into the account the five competitive forces, what do you think lies ahead for the worldwide banking industry? (25m)

In order to analyze the banking industry effectively, The Porter Five Forces model will be used to study the potential threats within the market that will impact to the TISCO. The 5 forces are: 1)Threats from new entrance or potential competitors. 2) Threat of Substitute products 3) Threat of existing rivalry. 4)The power of the customers. 5) The Power of Suppliers. If all of those forces are high then the industry is less favorable to enter. Before entering a industry, one firm should check whether those forces is low, so its favorable for the firm to enter.