Objective of the Study

The objective of the study is to identify the strategies Private Commercial Banks in
Bangladesh use to market their products. At the same time the paper focuses to gain an
understanding on issues that are important for developing marketing strategies for financial
services. We have analyzed the relative position, pricing strategies, promotional activities
etc. of the selected Private Commercial Banks operating in Dhaka city to identify their
position in the market and the competitive situation as well.

STRATEGIC MANAGEMENT

Introduction
Strategic planning is a management tool, period. As with any management tool, it is used for
one purpose only: to help an organization do a better job - to focus its energy, to ensure that
members of the organization are working toward the same goals, to assess and adjust the
organization's direction in response to a changing environment. In short, strategic planning is
a disciplined effort to produce fundamental decisions and actions that shape and guide what
an organization is, what it does, and why it does it, with a focus on the future. (Adapted from
Bryson's Strategic Planning in Public and Nonprofit Organizations).
A word by word dissection of this definition provides the key elements that underlie the
meaning and success of a strategic planning process: The process is strategic because it
involves preparing the best way to respond to the circumstances of the organization's
environment, whether or not its circumstances are known in advance; nonprofits often must
respond to dynamic and even hostile environments. Being strategic, then, means being
clearr bout the organization's objectives, being aware of the organization's resources, and
incorporating both into being consciously responsive to a dynamic environment.
The process is about planning because it involves intentionally setting goals (i.e., choosing a
desired future) and developing an approach to achieving those goals. The process is
disciplined in that it calls for a certain order and pattern to keep it focused and productive.
The process raises a sequence of questions that helps planners examine experience, test
assumptions, gather and incorporate information about the present, and anticipate the
environment in which the organization will be working in the future.
Finally, the process is about fundamental decisions and actions because choices must be
made in order to answer the sequence of questions mentioned above. The plan is ultimately
no more, and no less, than a set of decisions about what to do, why to do it, and how to do it.
Because it is impossible to do everything that needs to be done in this world, strategic
planning implies that some organizational decisions and actions are more important than
others - and that much of the strategy lies in making the tough decisions about what is most
important to achieving organizational success.
The strategic planning can be complex, challenging, and even messy, but it is always
defined by the basic ideas outlined above - and you can always return to these basics for
insight into your own strategic planning process.

STRATEGIC MANAGEMENT

Company Profile
AB Bank Limited, the first private sector bank was incorporated in Bangladesh on 31st
December 1981 as Arab Bangladesh Bank Limited and started its operation with effect from
April 12, 1982.
AB Bank is known as one of leading bank of the country since its commencement 27 years
ago. It continues to remain updated with the latest products and services, considering
consumer and client perspectives. AB Bank has thus been able to keep their consumers
and clients trust while upholding their reliability, across time.
During the last 27 years, AB Bank Limited has opened 77 Branches in different Business
Centers of the country, one foreign Branch in Mumbai, India and also established a wholly
owned Subsidiary Finance Company in Hong Kong in the name of AB International Finance
Limited. To facilitate cross border trade and payment related services, the Bank has
correspondent relationship with over 220 international banks of repute across 58 countries of
the World.
In spite of adverse market conditions, AB Bank Limited which turned 27 this year, concluded
the 2008 financial year with good results. The Banks consolidated profit after taxes
amounted to Taka 230 cr which is 21% higher than that of 2007. The asset base of AB grew
by 32% from 2007 to stand at over Tk 8,400 cr as at the end of 2008.
The Bank showed strong growth in loans and deposits. Deposit of the Bank increased by Tk.
1518 cr i.e., 28.45% while the diversified Loan Portfolio grew by over 30% during the year
and recorded a Tk 1579 cr increase. Foreign Trade Business handled was Tk 9,898 cr
indicating a growth of over 40% in 2008.
The Bank maintained its sound credit rating in 2008 to that of the previous year. The Credit
Rating Agency of Bangladesh Limited (CRAB) awarded the Bank an A1 rating in the long
term and ST-2 rating in the short Term.
AB Bank believes in modernization. The bank took a conscious decision to rejuvenate its
past identity an identity that the bank carried as Arab Bangladesh Bank Limited for twenty
five long years. As a result of this decision, the bank chose to rename itself as AB Bank
Limited and the Bangladesh Bank put its affirmative stamp on November 14, 2007.
The Bank decided to change its traditional color and logo to bring about a fresh approach in
the financial world; an approach, which like its new logo is based on bonding, and trust. The
3

STRATEGIC MANAGEMENT

bank has developed its logo considering the contemporary time. The new logo represents
our cultural SHEETAL PATI as it reflects the bonding with its clientele and fulfilling their
every need. Thus the new spirit of AB is Bonding. The Logo of the bank is primarily red,
as red represents velocity of speed and purity. Our new logo innovates, bonding of affiliates
that generate changes considering its customer demand. AB Bank launched the new Logo
on its 25th Anniversary year.
AB Bank commits to nation to take a lead in the Banking sector through not only its strong
financial position, but also through innovation of products and services. It also ensures
creating higher value for its respected customers and shareholders. The bank has focused
to bring services at the doorstep of its customers, and to bring millions into banking channels
those who are outside the mainstream banking arena. Innovative products and services
were introduced in the field of Small and Medium Enterprise (SME) credit, Womens
Entrepreneur, Consumer Loans, Debit and Credit Cards (Local & International), ATMs,
Internet and SMS Banking, Remittance Services, Treasury Products and Services,
Structured Finance for Corporate, strengthening and expanding its Islamic Banking activities,
Investment Banking, specialized products and services for NRBs, Priority Banking, and
Customer Care. The Bank has successfully completed its automation project in mid 2008. It
envisages enabling customers to get banking services within the comfort of their homes and
offices.
AB Bank has continuously invests into its biggest asset, the human resource to drive forward
with its mission to be the best performing bank in the country. The bank has introduced
Dress Code for its employees. Male employees wear designed ties and females wear
Sharee or Salwar Kamiz, all the dresses are consisted with the unique AB Bank logo.
AB is recognized as the peoples choice, catering to the satisfaction of its cliental. Their
satisfaction is ABs success.

STRATEGIC MANAGEMENT

Corporate Information
Company name & logo

Legal Form: A public limited company incorporated on 31st December, 1981 under the
Companies Act, 1913 and listed in the Dhaka Stock Exchange Ltd and Chittagong Stock
Exchange Ltd.

Commencement of Business
27th February 1982

Registered Office
BCIC Bhaban, 30-31, Dilkusha C/A
Dhaka 1000, Bangladesh.
Tel: +88-02-9560312
Fax: +88-02-9564122, 23
SWIFT: ABBLBDDH
E-mail: info@abbank.com.bd
Web: www.abbank.com.bd

STRATEGIC MANAGEMENT

Strategic Planning Process

The Main Components of the Strategic Planning Process

STRATEGIC MANAGEMENT

Mission & Vision

Mission
A company's mission is its reason for being. The mission often is expressed in the form of a
mission statement, which conveys a sense of purpose to employees and projects a company
image to customers. In the strategy formulation process, the mission statement sets the
mood of where the company should go.
Objectives
Objectives are concrete goals that the organization seeks to reach, for example, an earnings
growth target. The objectives should be challenging but achievable. They also should be
measurable so that the company can monitor its progress and make corrections as needed.

Vision & Mission of AB Bank Limited

Vision Statement
"To be the trendsetter for innovative banking with excellence & perfection"

Mission Statement
"To be the best performing bank in the country"

STRATEGIC MANAGEMENT

Organ gram of AB Bank Limited.

Organ gram of AB Bank Limited.

Strategic Managers for All Levels

Strategic Managers for All Levels of AB Bank Limited are shown below:

Corporate
Level

Business
Level

Functional
level

FIG: Strategic Managers for All Levels

SWOT
SWOT

analysis is a strategic planning method used to evaluate

the Strengths, Weaknesses, Opportunities,

and Threats

involved

in

a projector
projector in a business venture. It involves specifying the objective of
the business venture or project and identifying the internal and external
factors that are favorable and unfavorable to achieve that objective. The
technique is credited to Albert Humphrey,
Humphrey, who led a convention at
Stanford University in the 1960s and 1970s using data from Fortune
500 companies.

A SWOT analysis must first start with defining a desired end state or
objective. A SWOT analysis may be incorporated into the strategic
planning model. Strategic Planning, including SWOT and SCAN

analysis,
analysis, has been the subject of much research.
Strengths: attributes of the person or company that is helpful to

achieving the objective(s).

Weaknesses: attributes of the person or company that is harmful to

achieving the objective(s).

Opportunities: external conditions that is helpful to achieving the
objective(s).

Threats: external conditions which could do damage to the objective(s).

Identification of SWOTs is essential because subsequent steps in the
process of planning for achievement of the selected objective may be
derived from the SWOTs.

SWOT (Strength, Weakness, Opportunities, Threats)

W (Weakness)

S (Strength)

Good Reputation
Brand name
Online banking transaction
First generation bank
Bank Ratting (AA3 )
Basel II Compliance

O (Opportunities)

Limited resources for staff

development
Fiscal uncertainty
Limited Debit & credit Card
Facility

Limited banking product

Customer Support is not up to the mark

T (Threats)

Better Customer service will be

benefited the company.
Syndication loan.
Take short time to complete Loan
procedure.
Know Your Customer (KYC)
Compliance.
Faster Remittance Payment.
Providing deferent types of loan.
Properly Online Support.
Provide Debit and Credit Card
Support.

Bangladesh bank Compliance

Inability to compete for
qualified skilled people
Electricity problem over the
country.
Political unstable

SWOT analysis of AB Bank Limited

BCG Matrix
The BCG matrix model is a portfolio planning model developed by Bruce
Henderson of the Boston Consulting Group in the early 1970's.
The BCG matrix or also called BCG model relates to marketing. The BCG
model is a well-known portfolio management tool used in product life
cycle theory. BCG matrix is often used to prioritize which products within
company product mix get more funding and attention.
The BCG model is based on classification of products (and implicitly also
company business units) into four categories based on combinations of
market growth and market share relative to the largest competitor.

Relative Market Share

Low

Start

Question Mark

Low

Market Growth rate

High

High

Cash Cow

DOG

Stars
Stars generate large sums of cash because of their strong relative market
share, but also consume large amounts of cash because of their high
growth rate. So the cash being spent and brought in approximately nets
out. If a star can maintain its large market share it will become a cash cow
when the market growth rate declines.

Question Marks
Question marks are products that grow rapidly and as a result consume
large amounts of cash, but because they have low market shares they
dont generate much cash. The resultBCG
is Matrix
large net cash consumption. A
question mark has the potential to gain market share and become a star,
and eventually a cash cow when the market growth slows. If it doesnt
become a market leader it will become a dog when market growth
declines. Question marks need to be analyzed carefully to determine if
they are worth the investment required to grow market share.
Dogs
Dogs have a low market share and a low growth rate and neither
generates nor consumes a large amount of cash. However, dogs are cash
traps because of the money tied up in a business that has little potential.
Such businesses are candidates for divestiture.
Cash Cows
As leaders in a mature market, cash cows exhibit a return on assets that is
greater than the market growth rate so they generate more cash than
they consume. These units should be milked extracting the profits and
investing as little as possible. They provide the cash required to turn
question marks into market leaders.

Profit (Taka in milion)

7000
5802

6000
5000

4298

4000

Profit TK in milion

3325

3000
2000
1000

360

755
211

0
2004

2005

2006

2007

2008

2009

Fig: Yearly Profit Graph

Year
2004
2005
2006
2007
2008
2009

Profit TK in milion
360
755
211
3325
4298
5802

In the above information we were analysis the company position of the

market. Every year the profit margin of the company is growing rapidly.
This type of growing shows the BCG matrix analysis is star.

Profit (Taka in milion)

7000
6000

5802

5000
4298

4000

Profit TK in milion

3325

3000
2000
1000
360
0
2004

755
2005

211
2006

2007

2008

2009

Stars,
Stars, the last years businesses represent the organizations best
long run opportunities for growth and profitability. Divisions with a
high relative market share and a high industry growth rate should
receive substantial investment to maintain or strengthen their
dominant positions. Forward, backward and horizontal integration;
market penetration; market development; product development;
and joint ventures are appropriate strategies for these divisions to
consider.
consider.

Corporate-Level Strategies
Corporate level strategy covers the strategic scope of the organization as
a whole. For most organizations the corporate level strategy is the only
strategic plan required.
Often corporate level strategy is simply referred to as corporate strategy,
or in unified companies the corporate business strategy.
The process that produces it is called corporate strategic planning, or
sometimes simply corporate planning.
In a few situations however, it may be justified to speak of corporate level
strategy to distinguish it from other kinds of planning.
In AB Bank Limited follows the corporate level strategy like,

Priority Banking
SME Banking
Remittance zone
Business Banking
Corporate loan, syndicate loan, etc.

Business-Level Strategies
Business-level strategies are similar to corporate-strategies in that they
focus on overall performance. As distinct from corporate-level strategy,
however, they focus on just one instead of a range of businesses. The
corporate level strategy of a multi division operation is like a strategy for
managing an investment portfolio.
AB Bank Limited usually individual enterprise-like entities oriented toward
a particular industry, product or service type, and or market. Businesslevel strategies are thus primarily concerned with:
1. Managing unit activities so they conform to organizational corporate
level strategies, sometimes including cooperation with other business
units to achieve strategic synergy.
2.

Developing

distinctive

capabilities,

resources

and

competitive

advantage in each unit.

3. Identifying product or service-market opportunities and developing
strategies for succeeding in each.
4. Monitoring the business industry environment so that strategies
conform to the needs of the markets at the current stage of development.

Functional-Level Strategies
Functional-level strategies are concerned with managing the functional
areas of the organization, such as product or service development and
design, marketing and sales, finance, human resources, production,
research and development, etc., so that each function upholds contributes
to individual business unit strategies and the overall corporate-level
strategy.
Functional strategies are primarily concerned with:

Efficiently deploying specialists within the functional area.

Integrating activities within the functional area
Making sure that functional strategies link effectively and efficiently
with business strategies and the overall corporate-level strategy.

Conclusion
Strategies for an organization may be classified by the level of the
organization responsible for the strategy. Corporate-level strategies
concern top management and address strategic issues of facing the
organization as a corporate whole.
Business-level strategies deal with major business units or divisions of the
corporate portfolio. Business-level strategies are generally developed by
upper and middle-level business unit managers, in negotiation on key
targets with the top corporate managers, and are intended to help the
organization achieve its corporate level strategy.
Functional or business process strategies address issues usually faced by
lower-level managers and deal with strategies for the major organizational
functions such as marketing, finance, production, and research, which are
considered important to achieving the business strategies and enabling
the corporate-level strategy.

Reference
http://abbank.com.bd/abbl-at-a-glance.html
http://abbank.com.bd/background-of-abbl.html
AB Bank Limited, Audit Report of 2010
http://abbank.com.bd/vision-mission.html