Strategic Management

“YES BANK” Case Analysis

10/01/2014

Prepared by:
Harsh Vyas – 212011
Kali Prasad Pandey – 212013
Kavita Kharayat – 212016
Kunal Nagpal – 212017
Manish Sisodia – 212018
 YES BANK, one of the new generation private
sector banks, was set up in India after reforms
were introduced in the banking sector in the
1990s. Yes Bank entered the market in late
2004 when the banking space in India was already
overcrowded with a number of public sector banks,
private sector banks, and co-operative banks.
Foreign multinational banks, which were growth-constrained, were
also waiting eagerly for the sector to open up further in 2009 to make
a major foray into this emerging market. However, despite being a late
entrant, Yes Bank drew the attention of its competitors and analysts by
the speed at which it grew and by increasing its operations throughout
the country.

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 Banking reforms started in early 1990’s.

 The reforms in the financial sector were based upon the recommendations of
the Narsimhan committee.

 India was dominated by the public sector banks which nearly had 83 % of the
banking business.

 Reforms like deregulation of interest rates, better disclosure norms, debt

recovery tribunals, and new private sector banks were set up.

 The second phase reforms took place in 2009 which included reducing NPA
to 3%, extending credit facilities to rural areas, reducing higher rates of interest
and giving more importance to priority lending sectors etc.

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 Yes bank was promoted by Rana kapoor
and Ashok Kapur.

 The bank went public in June 2005.

 YES BANK is the only Greenfield license

awarded by the RBI in the last 15 years.

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Vision: To be recognized as the ‘Best Quality Bank of the World in India’ by
2015 and to evolve as the Professionals’ Bank of India

Mission: To establish a high quality, customer centric, service driven, private

Indian Bank catering to the ‘Future Businesses of India’. The Version 2.0
launched in April 2010 aims to achieve the following by March 2015:

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 Means: Trust, Growth, Technology,
Human Capital, Transparency and
Responsible Banking.

Ends: Objective of becoming the Best

Quality Bank of the World in India.

The foundation of this strategy lies in the name "YES", which underlines the twin
ethos of service and trust and the promise to deliver a truly delightful and
unprecedented Banking experience to all customers.

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Political factor:
 RBI’s 1991 monetary policy and control systems

 To enlist the confidence of global investors and International market players

 Number of legislative changes to enable competitive banking systems

Economical factor
 Economic Fluctuation -Delay in Indian Vision of 2020

 Every year RBI declares its 6 monthly policies

 If FDI limits are relaxed then more FDI are brought in India through Banking

channels

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Socio Economic factor
 Tradition maharaja Pratha

 Change in Lifestyle

 Literacy Rate

 Population

Technological Factor
 Foreign banking sectors entered in Indian market witb asserting the

technological based approach

 ATM Machines

 Credit Card Policies

 IT services and Mobile Banking

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Strength

 Efficient Human capital

 Top management very experienced.
 High class technology
 Client Knowledge database
 Advanced risk management systems
 Pioneer in usage of internet services
 Ability to raise funds easily because of foreign shareholding
Opportunities

 Building new client relationships

 Expanding the advisory and Customized services offered to clients,
investors, and banks
 Other competitor like ICICI bank has Primarily targets upper middle class
and upper class of the society. Expanding business to the middle and lower
income groups
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Once they identify a particular area, then they set up a specialized business
unit to create a viable business for the bank.

Porters Generic Strategies

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The success of yes bank can be attributed to its “Differentiating Strategy.”

 The bank differentiated itself from other players in the industry through
its on three basic parameters.

• Knowledge banking approach

• Emphasis on technology
• Human resource

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 A unique method of acquiring customers and retaining them.

 The knowledge banking approach was its main pillar of differentiation and
using it provided specialized service to various sunrise industries through
domain expert.

 Yes bank decided to follow an innovative approach to break into the heavily
cluttered Indian commercial banking system.

 The bank provides specialized service to the emerging sectors of the

economy through better understanding of its clients business and industry.

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 The bank focused on providing the customer with specialized banking
service depending upon their requirement.

 The bank identified some sectors of economy which had growth prospect:-

• Food and Agribusiness
• Life Sciences
• Telecom
• IT
• Media and Entertainment
• Infrastructure

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“We have made a calibrated decision to invest in the best IT systems and
practices in order to make its technology platform a strategic business tool
for building a competitive advantages”
Srikrishan H ( Executive director)

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 Yes bank was founded with the aim of providing the world
class customer service to the customer using latest technology in the
industry.

 The bank consider technology as a strategic tool to differentiate itself

from other banks.
• Corporate internet banking

• ATMs

• Mobile banking

• Phone banking

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 The bank entered into the strategic partnership with Gartner inc. to
formulate and implement the bank IT policy.

 Price Water House Coopers to facilitate the confirmation of policies

and process with ISO and six sigma norms.

 It believed in outsourcing those activities that are not part of its core
competencies.

 It entered into a total outsourcing deal with Wipro Infotech in Dec

2004.

 Achieving a high level of efficiency through the automation of

operations.

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 Maintaining centralized database and centralized processing for speedy
retrieval of data.

 Connectivity with customers and external agencies to provide a consistent

experience at various “touch-points”.

 Using the best systems for seamless integration of front, middle, and back
offices.

 Adopting the best inspection and security system to provide a better comfort
zone for customers of bank systems.

 Using real-time environment for good disastrous recovery process and

back-up systems.

 Wireless advances.

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Yes Bank ---Employees are strategic asset for long term competitive asset.

Main objective

 To emerge as one of the best employers in the country & as most preferred
recruiter in the banking sector.

 Higher pay for Retention of talented employees.

 Performance management process.

 Synergy at work.

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 Yes entrepreneur in action  Take break from regular work to focus
on project of his/her interest to achieve individual goal.

 Yes-Professional Entrepreneurship Program (YPEP)

• Talent management initiative.
• Talented middle & upper management for strategic initiative.

 Yes-retail Entrepreneurship programme (YR EP)

• To beat cutting edge skills of latest development to meet future needs.

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 Yes Mentor : Assigning a senior and dynamic employee as a mentor to
new employee

 Yes school of banking : To create a center of excellence for providing

training in banking & other financial services in the banking .

 Yes University and school Relations: Recruitment of meritorious

students from university campuses. Offering internship to the students.

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 Value Chain for a Differentiation Strategy of Yes Bank
Firm Infrastructure – Money Monitor, Mobile payments, Two-factor
authentication, Mobile Banking , RFID, speech enabled IVR

Human Resources: Higher pay, Performance Management Process,

MA
Synergy at work, Yes entrepreneur in action, YPEP, YREP, Yes Mentor

RG
Yes School of Banking, Yes University and School Relations

IN
Technology: Outsourcing ATMs, Mobile Banking, Phone Banking,
Partnership for IT Policy, SIX Sigma Norms, Automation of Operations

Inbound Operations Outbound Marketing

Logistics Faster turn Logistics & Sales
Customer around time. •high quality customer Knowledge Service
Database service. Banking Knowledge
Dedicated trade Banking
Technology desk for • Customized. Less
handling trade Products advertising Sophisticated
High Skilled transactions focus .

IN
& delighted

RG
Human • asset quality through customer

MA
capital Specialized disciplined credit risk service.
advisory team management. and
for catering to address inefficiencies
SME in the Indian financial
sector.
Yes Bank has positioned itself as a bank which gives higher standard of
services through product innovation for the diverse need of individual &
corporate clients. So they want to highlight following points in their
positioning segment :

 Customer centric
 Service oriented
 Product innovation
 Using TOWS matrix to generate alternative strategies
Strength

 Efficient Human capital

 Top management very experienced.
 High class technology
 Client Knowledge database
 Advanced risk management systems
 Pioneer in usage of internet services
 Ability to raise funds easily because of foreign shareholding
Opportunities

 Building new client relationships

 Expanding the advisory and Customized services offered to clients,
investors, and banks
 Other competitor like ICICI bank has Primarily targets upper middle class
and upper class of the society. Expanding business to the middle and lower
income groups
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 Grown at a tremendous pace.

http://jainmatrix.com/2012/09/14/yes-bank/

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 The Bank differentiated itself from other players through
 Unique “knowledge banking‘ approach”

 Emphasis of high end technology to provide innovative solutions

 Highly qualified human resources.

 Rather than expanding very quickly, the bank focused on the

niche segments of the customers

 The bank catered to a niche segment which helped it to avoid

price competition
 Overall, it aimed at establishing itself as knowledge based and

technology driven bank that would cater to the needs of

emerging Indian economy

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 Yes, the Business strategy implied by Yes Bank was a runaway
success.

 Unrelenting efforts to provide world class service coupled with

steadfast maintenance of operational standards were the prime
reasons for bank’s phenomenal growth.

 The growth was even impressive considering it came at a time

when the banking sector was on the verge of consolidation phase

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 December 2006 the bank rated as third best private bank
in India by business world

 Ranked second best private bank in financial express -

Ernst & young survey of India’s best for the year 2006.

 YES BANK has recently become the first Indian

Bank to become a signatory to the United Nations
Global Compact

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 http://www.yesbank.in/
 http://en.wikipedia.org/wiki/Yes_Bank
 http://articles.economictimes.indiatimes.com/2013-10-
23/news/43326592_1_credit-growth-rajat-monga-profit-growth
 http://jainmatrix.com/2012/09/14/yes-bank/

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Thank you

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