Professional Documents
Culture Documents
By
September 2011
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CERTIFICATION
I hereby declare that this submission is my own work towards the Commonwealth
published by another person nor material which has been accepted for the award of
any other degree of the University, except where due acknowledgement has been
Student
………………. Date:
Supervisor:
……………………….. Date:
…………………….. Date:
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ABSTRACT
compete successfully in the market place, it has practically no chance of growth and
would remain a tiny firm performing far below its potential. In an increasingly
strategies leads to weak competitive positions and hence performance below the
industry average. The purpose of this study is to examine the competitive strategies
with Ghana Commercial Bank as a case study. Both primary and secondary data were
sourced and used for the analysis of the study. Primary data was collected using
was collected from Annual Reports of GCB for five years from 2005 to 2010, GCB‟s
internal newsletters The Eagle and Commerbank News etc and the Business and
Financial Times. The study revealed that the bank has drawn up several strategic
plans and religiously implemented them since 1990. It also came to the fore that the
bank enjoys competitive advantage in the industry, the most important factor
contributing to the competitive advantage, being the bank‟s extensive branch network.
The study recommended that the bank should improve its IT infrastructure, streamline
its loan application processes, train staff to be more customer-friendly and proactive,
de-congest the banking halls and serve customers faster all in a bid to meet and
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TABLE OF CONTENTS
Content Page
Title Page i
Certification ii
Abstract iii
Table of Contents iv -
vii
List of Tables viii
List of Figures ix
List of Appendices x
List of Abbreviations xi
Acknowledgement xiii
CHAPTER ONE
1.0 Introduction 1
1.1 Background of the Study 3 -4
1.2 Statement of the Problem 4-6
1.3 Objectives of the Study 6-7
1.4 Research Questions 7
1.5 Significance of the Study 7-9
1.6 Scope of the Study 9
1.7 Limitations of the Study 9 - 10
1.8 Organization of the Study 10 – 11
CHAPTER TWO
2.0 The Concept of Strategy 12 - 15
2.1 Levels of Strategy 15 - 16
2.2 The Concept and Evolution of Strategic Planning 16 - 18
2.2.1 Mission, Vision, Goals and Objectives 18 - 19
2.2.2 Mission Statement 19
2.2.3 Vision Statement 19
2.2.4 Goals and Objectives 20
2.2.5 The Relationship between Strategic Planning and Performance 20 - 22
2.2.6 The Impact of Strategic Planning on Performance 22 - 25
2.3 Competition 25 - 26
2.3.1 Competitive Advantage 26 - 27
2.3.2 Sustaining Competitive Advantage 27 - 28
2.3.3 Sources of Competitive Advantage 28
2.4 Porter‟s Generic Competitive Strategies 28 - 29
2.4.1 Cost Leadership 29 - 31
2.4.2 Differentiation 31 - 32
2.4.3 Focus 32 - 33
2.5 Competitor Analysis 33 - 34
2.5.1 Competitor Array 34 - 35
2.5.2 Competitor Profiling 35 - 39
2.5.3 Drivers of Competition among Banks 40 - 41
2.5.4 Effects of Competition on Banks 41 - 42
2.5.5 Effects of Competition on Lending by Banks 42 - 44
2.5.6 Effects of Competition on Profits and Deposits of Banks 44
2.5.7 Branch Network and Competition 45 - 47
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2.5.8 Competition and ICT in the Banking Industry 47 - 49
2.5.9 Competition and Customer Service 49 - 50
2.6 Winning Customer Service Strategies 50
2.6.1 Service Strategy and Competition 50 - 51
2.6.2 Customer-Friendly Systems and Competition 51 - 52
2.6.3 Customer-Friendly People and Competition 52
2.6.4 Theoretical Frameworks 52
2.7.4.1 Competition and Time 52 - 53
2.7.4.2 Competition and Efficiency 53
2.7.4.3 Competition and Lending 53
2.8 The Origin of Banking 54 - 56
CHAPTER THREE
3.0 Methodology 63
3.1 Introduction 63
3.2 Research Design 63
3.3 Population 64
3.4 Sample and Sampling Procedure 64 - 66
3.5 Sources of Data 66
3.5.1 Primary Data 66
3.5.2 Secondary Data 66 - 67
3.6 Data Collection Method 67
3.7 Questionnaire 67 - 68
3.8 Method of Data Analysis 68
CHAPTER FOUR
4.0 Introduction 69
4.1 Demographic Background of Respondents 69 - 70
4.1.1 Gender of Respondents 70 - 71
CHAPTER FIVE
5.0 Introduction 81 - 82
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5.3 Suggested Areas of Further Research 87
References 90-97
Appendices 98 -105
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LIST OF TABLES
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LIST OF FIGURES
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LIST OF APPENDICES
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LIST OF ABBREVIATIONS
AR Activity Ratios
ATM Automated Teller Machine
BBG Barclays Bank Ghana Limited
CEO Chief Executive Officer
EBG Ecobank Ghana Limited
EFTPOS Electronic Funds Transfer at Point of Sale
EZWICH Brand name for Ghana‟s National Payment Platform
GCB Ghana Commercial Bank Limited
GDP Gross Domestic Product
LR Liquidity Ratios
SME Small and Medium Scale Enterprise
SCB Standard Chartered Bank
SG-SSB Societe General- Social Security Bank
SRR Shareholders‟ Return Ratios
FINSAP Financial Sector Adjustment Program
NIB National Investment Bank
PMSU Professional and Managerial Staff Union
PR Profitability Ratios
ROI Return on Investment
WAN Wireless Area Network
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ACKNOWLEDGEMENT
I am grateful to the Almighty God for seeing me through the MBA course, without
Kyeremateng deserves special praise for agreeing to supervise this project and for his
insight. To Mr. Ernest Agyei, your secretarial expertise and invaluable support is
highly appreciated
encouraging staff to upgrade their skills and competences, I thank all the staff who
answered questionnaires used in this and all those I interviewed. Finally, I wish to
thank all the people who in diverse ways assisted me in this project.
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CHAPTER ONE
GENERAL INTRODUCTION
1.0 Introduction
economic and technical characteristics which give rise to competitive forces. A firm
can clearly improve or erode its position within an industry through its choice of
strategy. Competitive strategy, then, not only responds to the environment but also
attempts to shape the environment in its favour (Porter, 1985).The strategist must
therefore seek to position his or her firm to cope best within its industry environment
(17) banks between 1990 to 2009 (Ghana Banking Survey,2009 ), notable among the
new entrants are Ecobank Ghana Limited, Stanbic Bank, UT Bank, Unibank,
Amalgamated Bank, United Bank for Africa and Zenith Bank to mention a few. There
are currently 26 banks operating in Ghana, with the attendant jostling for positions,
market share and profits. Competition is at the core of the success or failure of the
Ghanaian banking industry, and the influx of new banks onto the banking scene
means Ghana Commercial Bank can no longer invest in short term government
securities , fold her arms and expect excellent financial performance at the end of the
year.
talented personnel from one bank to the other.There has been the introduction of
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products have being designed to suit different categories of customers.The Banks
promote their products, although bank products offered by competitors seem alike.
New products and services are easily replicated by rivals. The only difference is the
All the banks are now licensed to carry out universal banking. They offer loans and
overdrafts, export and import financing, corporate finance and facilities for small and
medium scale enterprises (SME‟s). The previous regulatory regime which categorized
thereby increasing the level of competition, as each bank can venture into any area of
Banking industry has however, seen dramatic changes in the last decade (2000-2010).
New companies both local and foreign (particularly from Nigeria and South Africa)
The liberalized economic environment as mentioned earlier has lead to the influx of
banks hence, the need to assess the effectiveness of Ghana Commercial Bank‟s
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competitive strategy. On this premise, the concepts ofcompetitive edge over other
players, its importance and impact on corporate performance are now considered.
strategy is like an airplane weaving through the skies, hurled up and down, slammed
by winds and lost in the thunder heads. If lightning or crushing winds do not destroy
it, it will simply run out of fuel. In similar line of thought, Ross et al (2000) note that
Clearly, these statements emphasize the importance and need for far reaching
the ever changing global competitive business environment. Ansoff (1970) argues that
which are strategically managed than those which are not. This suggests a seeming
(Strickland, 2004).
Though these assertions are largely true, Pitts et al (2003) affirm that exceptional
situations also arise when some companies gain not because they had in place any
strategy but because they just benefited from some sudden conditions in the external
environment. For example, after the September 11, 2001 terrorist attack on the World
Trade Centre, Pentagon and in Pennsylvania all in the United States of America, air
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travel within and across that country dropped drastically in favour of rail and road
transport which were thought to be safer. Rail and road transporter operators
Nonetheless, and still consistent with the need for evolving and constantly reviewing
strategy, it is important to note that having a sound strategy in itself does not
Both strategy and implementation must be good and timely to achieve positive results.
train on a wrong track saying, „„every station it comes to is the wrong station.”
These fundamental principles largely hold true for all industries globally and as
should be expected, the banking industry is also subject to the dynamics of these
global market trends. Against this background, the study looks at the competitive
The economic climate in Ghana over the last decade has been relatively stable for
banking business. This notwithstanding, not all the banks can be said to have
performed at levels that meet industry and stakeholders‟ expectations. Much as the
still strongly believed that the strategies pursued by each bank largely account for its
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competitive advantage in the banking industry of Ghana. Management plays thelead
policies and strategies. Unfortunately, some banks are perceived to have management
structures that overly limit the authority to make long-term strategic decisions to a
few key shareholders who may be limited in some ways. This obviously compromises
the richness and diversity of the banks‟ strategic planning agenda to the detriment of
corporate performance.
The fear of loss of ownership control is also speculated to have inhibited the
expansion of the capital base of some of the private banks. This under-capitalization
has posed challenges for the hiring and retention of the needed numbers and quality of
personnel, upgrading of technology and the financial capacity to insure big and
complex risks.
distressed banks have since the 1980s attempted to restore their profitability and
period immediately after the implementation of FINSAP, chalking 45% of the overall
industry profits in 1993. However, the period after 1993 has witnessed a declining
market share for GCB. The bank‟s market share of deposits was 38% in 1993 but has
gradually declined to 17.8% in 2006, Standard Chartered Bank, however, made gains
moving from 9% of the industry share of deposits in 2003 to 13.1% in 2006. GCB‟s
return on equity of 28.7% also does not compare favourably with those of its major
competitors namely; Barclays Bank, Ecobank, and Standard Chartered Bank which
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posted 52.1%, 43%, and 38.9% respectively in 2006 (Business &Financial Times,
May 21,2007).
Though the bank is utilizing its extensive branch network and modern technology to
better its operations, the bank‟s low cost strategy which is amply demonstrated in its
very attractive base rates are of no use if a greater number of loan applications are not
processed because of the stringent criteria and lengthy procedures. GCB demands that
customers deposit registered titledeeds to secure loan facilities, but land registration is
cumbersome, very expensive and therefore unpopular in most parts of the country
The bank seems to be using mainly low cost leadership and a little bit of
differentiation as its competitive strategy. Most of the bank‟s products are reasonably
priced and the bank‟s charges compare favourably with those of its close competitors
(i.e. Barclays Bank, Ecobank and Standard Chartered Bank). It also appears that
competing on pricing alone may not be in the long-term interest of the bank as it is no
longer translating into a competitive advantage for the bank. The bank has gained a
This study attempts to investigate the above issues and the reasons behind the mixed
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1.3 Objectives of the Study
The main goal of the study is to assess the strategies adopted by banks to gain
ii. To diagnose the reasons for the success or failure of the strategies.
industry.
4. Of the strategies being pursued by GCB, which ones contribute most to the
Financial relations, all over the world have been deeply transformed in the last two
decades, new products, markets and new regulatory regimes have radically altered the
opportunities but also creating new and sometimes very great risks.
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Over the last decade, the liberalization and deregulation of the Ghanaian financial
sector have dramatically changed the financial landscape. Interbank competition has
institutions and financial markets. The survival of every business including banks
depends on its ability to survive the competition and improve its profitability.
Banking institutions occupy a central position in the nation‟s financial market and are
between surplus and deficit spending units, banks increase the quantum of national
By granting of credit, banks create money and thus influence the level of money
supply which is a crucial item in the growth of national income as it determines the
level of economic activity in any nation. Because many banking products are
undifferentiated commodities, banks are constantly looking for ways to set themselves
apart from the competition to help them win and retain customers and to improve the
bottom line.
According to the 2004 Ghana Banking Survey, on average, the services sector,
including the financial and banking sub-sectors has been the fastest growing sector
followed by the agricultural sector. The previous barriers which categorized banks
into commercial, development and investment banks etc., are no longer applicable
with the enactment of the Universal Banking Business Law in 2003. The overall
million in 2003 with total net profits rising from GH¢23.30 million to GH¢81.80
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million for the same period, signaling very high profits within the industry. (Business
It is hoped that this academic exercise would diagnose and make prescriptions that
would result in the GCB‟s competitiveness and profitability. Vital lessons may be
learnt from the findings of this study by other players in Ghana‟s banking
companies adopt the best practices in GCB‟s competitive strategy, enable GCB
improve on its strategic competitive activities and lastly, contribute to the body of
The study explored competitive strategies at the disposal of banks within the banking
industry in Ghana and is limited to GCB but where necessary comparisons were made
to her competitors. The main focus of the study was on Retail Managers, Operations
Managers, Heads of Department, Area and Retail Managers and non –managerial
The cardinal rule of banks which does not allow information on customers, strategies
and other sensitive issues to be discussed hampered efforts at getting some vital
information for the study. The fear of being branded as divulging secrets would also
Although this research work was purely an academic exercise, the bank‟s Planning
and Research Department needed a lot of convincing before agreeing to assist in the
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electronic distribution of questionnaires, thereby wasting the limited time available
most of the respondents could not complete the questionnaires on time. There was
however some consolation in the fact that the bank‟s intranet was put to good use in
Last but not the least, this research work, conducted by a full time Valuation Officer
of GCB was concurrently done with his official duties. Notwithstanding all these
limitations, the research was conducted taking advantage of the available data.
However, the limitations were not drawbacks to the overall success of the study.
The study is detailed in five chapters. Chapter one is the introductory chapter and
gives the background to the study, states the research problem, objectives of the study,
research questions, significance of the study and organization of the study. Chapter
Two reviews the existing literature on the subject, including; articles, books, journals
and publications. Light is shed on current literature relevant to the study and the
researchers in the field of strategic competitive advantage. Chapter Three offers useful
questions. It covers the methodology, specifically, the study type, sampling technique,
sample sizes, tools and procedures used to collect data needed to address the research
problems.
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Chapter Four is dedicated to the analysis and discussion of research findings and
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CHAPTER TWO
LITERATURE REVIEW
The word strategy comes from the Greek word Strategos which refers to military
generalship and combines stratos (the army) and ago (the lead). The history of
strategic planning has its roots in, and is a heritage of the military (David, 2003). The
Webster‟s New World Dictionary alludes to this militarism, defining strategy as the
forces into the most advantageous position prior to actual engagement with the
enemy. Clearly, the key aim of both business and military strategy is to gain
competitive advantage or combat superiority over competitors or foes as the case may
be.
What business strategy is all about is, summed up in two words ‘competitive
the most efficient way and also to mould actions and decisions of managers and
Military strategy books such as “The Art of War” by Sun Tzu (1965) “On War” by
Von Clausewitz (1975) and “The Red Book” by Mao Zedong (1965) have been an
invaluable knowledge base for many of the concepts especially on business tactics,
the dynamic and unpredictable future and principles of guerrilla warfare; these have
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guided and informed the writing of many books on strategic management in general
The word “strategy” has always been associated with and indeed been prominent in
its strengths and distinctive competences in such a way that it gains a competitive
advantage over its rivals in any given environment. Chandler (1962) defined it as “the
determination of the long-term goals and objectives of an enterprise and the adoption
of causes of action and the allocation of resources for carrying out these goals”.
It is the framework which guides those choices that determine the nature and direction
of the firm (Tregoe and Zimmerman, 1980). In the view of (Johnson et al, 2008; and
Johnson and Scholes in their book Exploring Corporate Strategy define strategy as
follows; „„Strategy is the direction and scope of an organization over the long-term
which achieves advantage for the organization through its configuration of resources
objectives, purposes, goals and the major policies and plans for achieving these goals,
stated in such a way as to define what business the company is in or is to be in and the
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According to (Wheelen and Hunger, 2006), a corporation‟s strategy forms a
comprehensive master plan that states how the corporation will achieve it mission and
objectives. The typical business firm usually considers three types of strategy;
management „game plan‟ for; running the business, strengthening the firm‟s
and Strategic Thinking” explained that before coming to a good understanding of the
term “strategic planning” it is best to examine the terms separately. He thus deposes
that strategic means “of or having to do with strategy” and being “of great
significance or import”. This underscores the reason why strategies exist or must exist
at various levels of the organization to give a clear direction (where it is headed) and
destination (what is it to become). For our purposes then, strategic means “of great
Plans of action and planning whether for business or the battlefield always consider
what is to be achieved (the ends, goals or objectives) and how it is to be achieved (the
means; steps, actions or programmes). Simply, plans are a set of intended outcomes
coupled with the actions by which those outcomes are to be achieved. On the other
hand, (Ackoff, 1981; Nickols, 2008) point out that planning involves thinking about
the future, identifying and specifying in advance (now) what has to be done or
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achieved (objectives) and selecting the most suitable means to accomplish these
objectives.
Planning can be formal or informal involving a lot or very little documentation. The
information base could be large; stated in reports, studies, databases and analyses or
depend on a few knowledgeable people. Plans, and thus the planning activities that
produce the desired ends frequently set time frames, milestones, detailed schedules
and allocate resources whether in the form of money, people, equipment etc. (ibid)
attitude toward growth and the management of its various businesses and product
lines. Corporate strategies typically fit within the three main categories of stability,
Business Strategy usually occurs at the business unit or product level, and it
services in the specific industry or market segment served by that business unit.
and business unit objectives and strategies by maximizing resource productivity. This
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(R & D) functional strategies are technological followership (imitation of the products
Strategic planning has been defined differently by various authors. The substantive
issues are however, the same; they focus on making plans and taking actions today for
the future prosperity and competitiveness of a firm in its environment with the
optimal use of available resources. McNamara (2008), identifies some of the major
activities that are common to all strategic planning processes as conducting a strategic
analysis; setting the strategic direction, action planning that is, carefully laying out
how the strategic goals will be accomplished etc. which will be explained later.
Chandler, 1962; Andrews, 1980; Porter,1980; Wyland, 2004 are unanimous in stating
achievable policy objectives for the future growth and development over the long
term, based on its mission, vision and goals and on a realistic assessment of the
human and material resources available to implement the plan. Dubrin (2006) sees it
as encompassing all those activities that lead to the statement of goals and objectives
and the choice of strategies to achieve them. Gluck (1972) adds that it is a unified,
comprehensive and integrated plan designed to ensure that objectives of the enterprise
are achieved.
These comprehensive definitions are concurred by Bryson (1998) who states that it 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 what it does. The process
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defines its medium and long term goals and objectives and approaches by which to
achieve them. It is a look into the future that identifies the mission, vision, goals and
It is the first in order, and safe to say the most critical management process. This is
further stating that the central thrust of strategic planning is undertaking moves to
strengthen the company‟s long term competitive position and financial performance.
This intricate and complex nature is borne out by David (2003) who espouses that
strategic planning takes an organization into uncharted territories and does not
through a journey and offers a framework for addressing questions and solving
problems, aware of the potential pitfalls and being ready to address them and being
successful.
These views are shared by McConkey (1999) who adds that plans are less important
than planning. This just means that though plans are vital as business road maps with
goals, objectives or targets to be met, the idea of planning being a process introduces
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contained. It emphasizes the point that process (planning) may be much more
Success in business or military exploits does not come by fluke but is the product of
both continuous attention to changing external and internal conditions and the
time the firm takes steps to avoid, foil or defend possible attacks from competitors
into its areas of weakness. It is thus both an attack and defense weapon which Hofer
and Schendel (2005) see as the mediating force or „match‟ between the organization
The term strategic planning according to David (2003) originated in the 1950‟s and
gained prominence in the mid-1960s to mid 1970s. Its use has traversed the 1990‟s
A company‟s strategic plan typically lays out its mission, vision and future direction,
therefore, Drucker (1999) emphasizes that strategic plans must be designed to support
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therefore exist between them in order for any organization to have a coordinated and
A firm‟s mission according to Pitts (2003) describes the organization in terms of the
business it is in, the customers it serves and the skills it intends to develop to fulfill its
vision. Daft (1991) agrees it is the firm‟s reason for existence and Ritson (2008)
affirms its linkage with vision. A mission statement is the overriding and distinctive
purpose of a company (Johnson, 2002; Pitts, 2003). GCB‟s mission provides for
innovative and competitive financial services through highly skilled and motivated
staff.
Vision describes the firm‟s aspirations of what it really wants to be. Pitts (2003) notes
that vision statements are designed to capture the imagination of the public and as
well galvanize the efforts of employees at all levels such that its emotional appeal
challenges them to commit their full energies and minds to believe it is the best.
The conceptual distinction between mission and vision is that a mission statement
describes the present scope of an organization‟s business and purpose (what we do,
why we exist and where we are now). The vision on the other hand portrays a
company‟s future business scope; where we are going or want to be (Thompson et al,
2004).
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2.2.4 Goals and Objectives
Goals are the broad, long-term accomplishments that an organization wants to attain,
achieve or where it wants to be. They provide the overall context for what the vision
tries to achieve (Nickels et al 2000). They are powerful tools that break the vision
statement into specific tasks and actions to attain desired results across the
They must be measurable and time specific as against having vague objectives like
„maximize profit‟, „reduce costs‟, „become more efficient‟or „increase sales‟. These
specify neither how much (figures) nor when (time) an objective is to be achieved.
They thus do not challenge employees to work hard to meet performance targets.
It may appear that making profit which is the obvious intention of any commercial
(CEO‟s) in America however, showed that they did not place „strong and consistent
profit‟ as their top priority, in fact it was ranked fifth (Hitt et. al 2003). Instead they
regarded a strong and well thought-out strategy as the most important factor to make a
firm promising in the future. Indeed, Thomas J. Watson Jr. formerly IBM chairman is
expendable and that success at best is an impermanent achievement which can always
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For example, Levi Strauss, a once successful company with a global brand and good
financial performance suffered setbacks in the 1990s and began its first lay-offs in
1997 as a result of mistakes and ineffective strategy. This was exploited by Gap and
Tommy Hilfiger its closest rivals. Xerox, a name synonymous with photocopying in
the 1970s and 80s also lost out to its competitors for lack of focus and foresight
(Business Week, May 2001). The foregoing points to the transient nature of success
company.
profitability and financial strength, a company‟s pursuit of strategic vision, long term
lenders will not continue to sink in any more money. However, it is as important to
yardsticks; one relating to financial performance and the other relating to strategic
performance. The former looks at performance indicators like sales revenue and
profitability whereas the latter includes output growth, technical progress, efficiency,
shareholder value added, economic value added and human resource capital etc.
and market position is crucial and unless it‟s performance in the market place reflects
improving competitive strength and market penetration, its progress is not considered
inspiring and its ability to continue posting good financial performance is in doubt. A
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firm‟s financial performance measures are „lagging indicators‟ that reflects the result
of the past decisions and organizational activities. Its „lead indicators‟ are future
Strategic planning is a management function that focuses on the growth and future
sustained well being of an organization. Ansoff (2003) affirms that the interest in
strategy grew out of the realization that a firm needed a well defined scope and
growth direction not just extrapolations of past performances which were being used
to project into the future. Hart and Banbury (1994), made an observation of firms‟
Since the 1950‟s and particularly the early 1970‟s, rapid changes and, or
perspective (Rosenberg et al, 1985; Kiechel III, 1989). As Drucker, (2004) noted in
his book The Practice of Management, “we cannot be content with plans for a future
we can foresee. We must prepare for all possible and a good many impossible
contingencies. We must have a workable solution for anything that may come up.”
This underscores the need for strategic planning in every organization; diversified or
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management schools, authors, consultants and organizations to research into and
Miller et al (1994) used financial indicators as criteria for the measurement of the
was that 20 studies found planning was associated with higher performance, 5 showed
wealth of literature has been contributed to by Robinson, Pearce, Vozikis and Hunger,
Greenley‟s (1989) review of the previous studies on manufacturing firms showed that
with planning, performance was better in 5, neutral effect in 3 studies and only 1
showed adverse result. Of particular significance was the review of an earlier work by
which carried out strategic planning with those which did not based on sales value,
sales and earnings per share, and net incomes. The result was that companies which
practiced strategic planning were largely more successful and better performers than
the non-planners. David (2003) argues that this is not to say that all companies that
Other researchers have delved into the qualitative (non-financial) aspects of the
performance appraisal. Hitt et al (2003) for example point out strongly that reputation
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awareness and emotional or affective regard) is a very important intangible resource
upon which a company can build capabilities and core competences. In a survey
Eastman Kodak, Campbell Soup, and Wrigley‟s Gum were valued at US$52, $12,
They explain that if a company can attract and hire highly-skilled people because of
its reputation, it will most likely increase its “intellectual capital.” This capital will
provide a competitive advantage for the firm over its rivals because of the new,
innovative and diversified ideas, products or services likely to come from them. The
intangible resource in the long run creates more profit and value for the company. The
Fortune 500 America‟s Most Admired Company, The Financial Times World‟s Most
Respected Companies and Ghana‟s version, The Ghana Club 100 all use various
Pearce and Robinson (2000) support this approach to evaluate the impact of strategic
Goodstein et al, (1993) corroborate these ideals and note further that the real measure
of strategic planning in any company is the extent to which it affects behaviour in the
organization.
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This chapter is devoted to the review of literature relating to the concept of strategic
planning, competitive advantage and how they have been used to impact performance.
commentary of the merits and faults of literature in a chosen area which demonstrates
familiarity with what is already known about a research topic. This view is supported
by (Jankowiscz‟s, 2005; Fisher, 2007) who argue that literature review makes the
need to reinvent knowledge that already exist in the given area of study unnecessary
and redundant.
Literature review provides the foundation upon which a research is built to confirm,
complement, counter or establish any new trends that possibly might have emerged.
This research proceeds accordingly to review literature that is relevant to the research
topic.
2.3 Competition
The banking sector is the largest and most competitive segment of Ghana‟s financial
as "the effort of two or more parties acting independently to secure the business of a
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prices. In micro-economic theory, resource allocation is more efficient under
2010).
Wheelen and Hunger, 2006, define competitors as organizations that offer the same,
occurs. The sustainability of this positional advantage requires that the business sets
up barriers that make imitation difficult, because these barriers to imitation are
continually eroding, the firm must continue to invest to sustain or improve the
advantage.
company to operate in a more efficient or otherwise higher quality manner than the
companies it competes with, and which results in benefits accruing to that company
(investorworks.com, 2010).
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2.3.2 Sustaining Competitive Advantage
competitive advantage is sustainable (Barney 1991; Coyne 1985). Barney lists four
characteristics; they must be valuable, they must be rare among a firm‟s current and
potential competitors, they must be imperfectly imitableand finally, there must not be
posited that the attainment of sustainable competitive advantage is not an end in itself,
but a means to an end –namely superior long term financial performance. A company
but to create wealth for its shareholders. Actions which contribute to sustainable
competitive advantage but detract from creating shareholder wealth can be a good
strategy in the competitive sense, but bad strategy for the company. It is also worth
noting that certain sources of competitive advantage may be more enduring than
others.
Superior Skills
The ability of a business to do more or better (or both) than its competitors – superior
skills are the distinctive capabilities of personnel that set them apart from those of
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competing firms. It also includes superior resources, locations, scale of operations,
breadth of sales force and distribution coverage, brand names etc. Superior skills and
superior resources lead to positional advantage, superior customer value and lower
relative cost.
Positional Advantage
barriers that could deter a firm from shifting its strategic position. It is understood best
A firm's relative position within its industry determines whether profitability is above
or below the industry average. The fundamental basis of above average profitability in
the long run is sustainable competitive advantage. Though a firm can have a myriad
of strength and weaknesses, vis-à-vis its competitors, there are two basic types of
competitive advantage a firm can possess: low cost or differentiation. The two basic
types of competitive advantage combined with the scope of activities for which a firm
seeks to achieve them, lead to three generic strategies for achieving above average
advantage, combining a choice about the type of competitive advantage sought with
advantage in a broad range of industry segments, while focus strategies target cost
39
advantage (cost focus) or differentiation (differentiation focus) in a narrow segment
(Porter 1998).
Under cost leadership, a bank sets out to become the low cost service provider within
the industry and hence develops a range of banking services and products and serves
many industry segments. The sources of cost advantage are varied in the banking
industryconsidering the structure of the industry. According to Reis and Trout (1982),
low cost producers typically sell a no-frills, standard product and place considerable
low overheads, abundant sources of cheap labour and efficient procedures for training
staff. The low cost strategy is probably the clearest of the three strategies. A low cost
producer must find and exploit all sources of cost advantage. The sources of cost
advantage which may be varied could include the pursuit of economies of scale,
40
proprietary technology, preferential access to raw materials and other factors. The
performance.
Although a cost leader relies on cost leadership for its competitive advantage, it must
above-average performer.
leader may be forced to discount prices well below competing products to gain sales,
nullifying the benefits of its favourable cost position (Peattie and Peattie, 1994).
obtain an acceptable market share does not offset a cost leader‟s cost advantage, and
According to Porter (1998), the strategic logic of the cost leadership usually requires
that a firm be the cost leader, and not one of several firms jostling for that position.
allows a firm to radically change its cost position. The theme that runs through the
vigorous pursuit of cost reductions from experience, tight cost and control, avoidance
41
of marginal customer accounts, and cost minimization in areas such as research and
2.4.2 Differentiation
differentiating the product or service offering of the bank, thereby creating something
with the five competitive forces. To be successful, that is, achieve and sustain
differentiation, the firm‟s price premium must exceed the costs incurred in creating or
attaining its unique position. The differentiator must therefore aim at proximity
relative to competitors through the reduction of cost in all areas which do not affect
the differentiation
The logic behind this strategy, according to (Porter, 1998), requires the firm to select
the attributes in which to differentiate itself from the competition, that is, the firm
price. Contrasting this position with cost leadership, there is more than one successful
by consumers.
dimensions that are widely valued by buyers. It selects one or more attributes that
meet those needs. It is rewarded for its uniqueness with a premium price.
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2.4.3 Focus
achieving their objectives throughout the industry, the focus strategy rests on serving
a specific target market very well, this is borne in mind when carving functional
strategies. The generic strategy of focus rests on the choice of a narrow competitive
scope within an industry. The focuser selects a segment or group of segments in the
industry and tailors its strategy to serving them to the exclusion of others. The focus
strategy has two variants; namely cost focus and differentiation focus.
In cost focus a firm seeks a cost advantage in its target segment, while in
differentiation focus a firm seeks differentiation in its target segment. Both variants of
the focus strategy rest on differences between a focuser's target segment and other
segments in the industry. The target segments must either have buyers with unusual
needs or else the production and delivery system that best serves the target segment
must differ from that of other industry segments. Cost focus exploits differences in
cost behaviour in some segments, while differentiation focus exploits the special
Any bank that wants to focus must select a segment or group of segments within the
banking industry and tailor its strategy to serving them to the exclusion of others. By
optimizing its strategy, for the target segments, the focuser seeks to achieve a
competitive advantage overall (Parasuarman et al, 1985). In the banking system, there
are two variants to the focus strategy. A cost focus bank is the type that seeks a cost
advantage in its target customer segment, while a differentiation focusing bank seeks
differentiation in its customer segment. Both variants of the focus strategy rest on
43
differences between a focuser‟s target segment and other segments within the industry
Banks which focus on cost will attempt to exploit differences in cost behavior in some
customer target segment; while differentiation focus exploits the special needs of
The notion underlying the concept of generic strategies is that, competitive advantage
“Being all things to all” is a recipe for strategic mediocrity and below average
performance, because it often means that a firm has no competitive advantage at all.
According to (Fleisher et al, 2003, 2007), competitor analysis is the management tool
Competitor profiling coalesces all of the relevant sources of competitor analysis into
essential component of corporate strategy, it is argued that most firms do not conduct
this type of analysis systematically enough. Instead, many enterprises operate on what
is called “informal impressions, conjectures, and intuition gained through the tidbits
44
traditional environmental scanning places many firms at risk of dangerous
competitive blind spots due to a lack of robust competitor analysis (Fleisher et al,
2007).
Gordon, (1989) states that one common and useful technique for conducting a
competitor analysis is the construction of a competitor array. The steps include the
following;
Define your industry - scope and nature of the industry,determine who your
competitors are, determine who your customers are and what benefits they expect,
determine what the key success factors in your industry are, rank the key success
factors by giving each one a weighting. The sum of all the weightings must add up to
one.
Rate each competitor on each of the key success factors, after which you multiply
The columns are then summed up for a weighted assessment of the overall strength of
each competitor relative to the others. This can best be displayed on a two
dimensional matrix - competitors along the top and key success factors down the side.
45
Table 2.1: Competitor Array
innovation ability (7 out of 10, compared to 4 out of 10) and distribution networks (6
out of 10), but competitor #2 is rated higher on customer focus (5 out of 10). Overall,
out of 40). When the success factors are weighted according to their importance,
customer value in the firm‟s chosen market. The definitive characteristic of customer
value is the adjective, superior. Customer value is defined relative to rival offerings
46
facilitates this strategic objective in three important ways. First, profiling can reveal
strategic weaknesses in rivals that the firm may exploit. Second, the proactive stance
of competitor profiling will allow the firm to anticipate the strategic response of their
rivals to the firm‟s planned strategies, the strategies of other competing firms, and
changes in the environment. Third, this proactive knowledge will give the firms
employed more deftly in order to counter the threat of rival firms from exploiting the
Clearly, those firms practicing systematic and advanced competitor profiling have a
analogy is to consider this advantage as akin to having a good idea of the next move
that your opponent in a chess match will make. By staying one move ahead,
checkmate is one step closer. Indeed, as in chess, a good offense is the best defense in
products, markets, facilities, personnel, and strategies. This involves the following
factors;
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Background
Under background, you assess the location of offices or plants, and online presence,
Financials
competitors would have to be analyzed. Notable among them are the following; P-E
ratios, dividend policy, and profitability,various financial ratios, liquidity, and cash
flow Profit Growth Profile; method of growth whether organic or acquisitive (ibid).
Products
The products offered, depth and breadth of product line, and product portfolio
balance, new productsdeveloped, new product success rate, Research & Development
strengths, brands, strength of brand portfolio, brand loyalty and brand awareness,
Marketing
Under marketing you have gather information on the segments served by your
competitors, their market shares, customer base, growth rates, and customer loyalty
sales force success rate online promotional strategies, distribution channels used
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Facilities
Under facilities, your competitors‟ plant capacities, capacity utilization rate, age of
plant, plant efficiency, capital investment,location, shipping logistics, and product mix
Personnel
Last but not the least, the number of employees, key employees, and skill sets strength
& retention rates of your competitors would have to be analyzed. The corporate and
divestitures marketing strategies would all have to be noted (Fleisher et al, 2007).
Media scanning
Scanning the advertisements of your competitors can reveal much about what that
competitor's advertising message can reveal new product offerings, new production
strategy, line extensions and contractions, problems with previous positions, insights
from recent marketing or product research, a new strategic direction, a new source of
al, 2007).
It might also indicate a new pricing strategy such as penetration, price discrimination,
price skimming, product bundling, joint product pricing, discounts, or loss leaders.
Hints on a new promotion strategy may also be dropped, new unique selling
49
propositions, new creative concepts, appeals, tone, and themes, or a new advertising
agency can all be inferred. It might also indicate a new distribution strategy, new
(ibid).
strategy, selectivity and focus. From a tactical perspective, it can also be used to help
a manager implement his own media plan. By knowing the competitor's media buy,
media selection, frequency, reach, continuity, schedules, and flights, the manager can
Other sources of corporate intelligence include trade shows, patent filings, mutual
customers, annual reports, and trade associations. Some firms hire competitor
New Competitors
competitive threats. The most common sources of new competitors are companies
companies already targeting your prime market segment but with unrelated products
those from other geographical areas with similar products. New start-up companies
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warrant attention as they could pose threats to the organization in the present or the
future (ibid).
The entrance of new competitors is likely when the following conditions exist; high
profit margins in the industry, unmet demand (insufficient supply) in the industry, no
major barriers to entry, future growth potential, competitive rivalry is not intense and
The banking industry has been characterized by increasing competition since the early
1980s. This has been the result of a number of interrelated factors such as:
services. The authors are of the opinion that an increased competition resulting from a
decade of deregulation of the financial services industry has meant that banks find
themselves faced with the task of differentiating their organizations and their
Brownbridge and Gockel, 1996 also argued that liberalization could stimulate greater
competition in banking markets through several channels. These include the new
entry into banking markets, the diversification of the operations of the DFIs away
from purely specialized functions, the removal of interest rate controls and credit
ceilings, which should allow banks greater freedom to compete for customers, and the
more aggressively against each other than banks owned by the public sector. New
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entry has brought about a small reduction in market concentration in the banking
industry.
Baer et al., (1988 as cited in Zardkoohi and Fraser 1988) identified four factors that
geographical deregulation makes it easier for banks to achieve economies of scale and
scope. Second, easier entry into banking markets, especially highly profitable
markets, provides incentives for existing banks in those markets to price their services
Fourth, banks that operate over a large geographical area offer standard products at a
uniform price throughout their market. While the appearance of new competitors in
local banking markets may stimulate the accruallevel of competition, the threat of
Levine (2003) documents, among others, that tighter entry requirements are
negatively linked with bank efficiency, leading to higher interest rate margins and
bank fragility. These results are consistent with the view that tighter entry restrictions
tend to limit competition and emphasized that it is not the actual level of foreign
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2.5.4 Effects of Competition in Banking
Ghana has experienced a huge increase in the number of banks due to rather liberal
commercial firms to develop new products, services, and technologies. This gives
consumers greater selection and better products. The greater selection typically causes
lower prices for the products compared to what the price would be if there was no
also lead to wasted (duplicated) effort and to increased costs (and prices) in some
below:
Shaffer (1998 as cited in Northcott 2004) shows that the number of loans made
increases as the number of banks increases. The more banks there are, the less chance
there is that any given borrower (including “bad” ones) will not get a loan. Therefore,
expected loan losses are also an increasing function of the number of banks. Of
course, many things can mitigate this effect, such as access to credit bureaus, where a
bank can find out whether a borrower has been rejected by other banks.
license policy exists. Schnitzer, (1999) in her analysis shows that bad loans are more
likely if there are a large number of banks competing for customers as free entry can
induce too much entry and thus too many bad loans compared to the social optimum.
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According to Harris and Holmstrom (1982 as cited by Boot and Thakor 2000)
interbank competition can have adverse effects on banks‟ marginal rents from
relationship lending. Each bank thus reduces its investments in sector specialization.
This result is consistent with the existing wisdom that, by threatening relationships,
encourages banks to shift from transaction to relationship lending, and banks do more
environment.
By combining this result with that of the reduction in sector specialization, one can
conclude that the nature of relationship lending itself changes with increasing
interbank competition; relationship lending becomes more important but each loan
Again Besanko and Thakor (1993 as cited in Schnitzer, 1999) analyse the impact of
competition in the case of relationship banking and from their analyses more
competition reduces rates for borrowers but makes banks take on more risk and thus
1999) studies how the market structure of the banking sector evolves endogenously if
market is not regulated and argued that banks acquire proprietary information about
their clients by lending to them gives existing banks advantage over new entrants.
Besanko, Thakor and Dell‟Ariccia share similar views that banks acquire information
Broecker (1990) and Riordan (1993) where banks acquire information about potential
54
customers before entering a relationship with them. The analysis showed that the
number of bad loans provided increases with the number of banks operating, which
has a negative impact on the average credit-worthiness of the borrowers who receive
credit.
The potential positive effects of the new entry associated with reduced barriers to
increased concentration. On the other hand, free entry lowers credit costs which have
Interbank competition affects the bank‟s profits from bothrelationship and transaction
bank from pure price competition, so that an increase in competition from other banks
hurts the bank‟s profits from transaction lending more than its profits from
relationship lending.
The existing theoretical literature on bank competition is mainly concerned with the
question of what impact financial market liberalization has on the stability of the
banking sector. According to Matutes and Vives (1996 as cited in Schnitzer, 1999)
banks compete for deposits. In their analysis the probability of bank failure increases
with the degree of rivalry because of the lower profit margins banks can obtain, which
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A similar effect was observed in Hellmann, Murdock and Stiglitz (1998) on deposits
in which competition for deposits erodes profits and thus promotes gambling in the
banking sector because the on-going concern value of the banks is lower. The
problem was that an increase in competition has little impact on the total amount of
Branch network has traditionally been viewed as a way for banks to retain market
power, because branches can appropriate some of the value clients place on location,
and thereby mitigate (or avoid) price competition. Branches are also typically seen as
a barrier to entry, since they involve large fixed costs. Another potential disadvantage
the fixed costs associated with branches, this increases banks‟ costs, which are passed
consumers. In an argument, Allen and Gale (2000 as cited in Northcott, 2004) show
that a few large banks with extensive branch networks can provide a more
costs: a large branch bank has less of an incentive to exploit the “locked-in” value of
clients, because it is always competing for the clients‟ future business in another
product or location.
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Another way in which branching can improve competitive conduct is by increasing
the effective size of the market. In Calem and Nakamura (1998 as cited in Northcott,
2004), branches can decrease the degree of market power exerted in remote locations
geographical market. Branching leads to more uniform pricing across remote and
urban locations. According to Calem and Nakamura (p. 608), “branch banking tends
to export competition in dense urban markets to outlying areas. Thus, branch banking
Branches are a way for banks to retain some market power; they also benefit
power in remote areas. The question is how many branches are optimal? Too many
branches pose a barrier to entry and engender a large fixed cost that may be passed on
to consumers, and too few may remove the pro-competitive effect of increasing the
size of the market. There is also a trade-off for banks in choosing the extensiveness of
While there are benefits to be gained from differentiation, banks will invest in
competition (e.g., due to competition from banks or other financial firms), the number
of branches should be expected to fall. That is, there may be a trade-off between price
are closely in line with that of Northcott‟s assertion about network branch banking.
That is to say that Ghana Commercial Bank has resorted to an aggressive branch
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Dick (2003 as cited in Northcott, 2004) examines the effect of lifting restrictions on
branching in the United States after the Riegle-Neal Act in 1994. Lifting the
restrictions on branching was associated with both higher concentration and increased
competition in lending rates. These studies are consistent with the idea that branching
Nakamura‟s research. Calem and Nakamura concluded that branch network approach
Calem and Nakamura (1998) research revealed that this approach breeds high
In addition to the above, the banking industry is an intensive user of a wide range of
banks and thereby affect bank behaviour and the structure of the market. There is
bank products and services, such as payments processing, cash management, and back
office operations. In the same vein, advances in technology may lead to the
development of new products and services that have more scale economies than
traditional banking products. Therefore, there is the potential for an increase in the
58
At the same time, the argument that technological progress has led to more scale
larger institutions, smaller banks may also benefit by outsourcing processes that are
particularly affected.
establish a physical delivery system, thereby reducing sunk costs and barriers to entry.
At the same time, because they provide a range of basic services (including deposits,
account transfers, and payments), ATMs can provide many of the benefits already
Remote banking, through the internet and over the telephone, is increasing in
popularity.
delivery systems of branches and ATMs. All a client needs to access banking services
extent that remote banking is embraced by consumers, it decreases the value placed
Consequently, a large uptake of remote banking may lead to a shift away from
competition through branches towards price competition. In this way, remote banking
can further decrease the barriers to entry. As well, because it is not tied to a particular
location, it can further expand the geographical scope of competition. While positive
geographical market.
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As remote banking becomes more important, the relevant market is much more likely
to be larger than the local area. Vesala (1998 as cited in Northcott, 2004) argued in his
theoretical model about banks that have branch and ATM networks lead to emergence
of remote banking and an increase in price competition even if there is no new entry
into the market. Remote banking has the potential to improve contestability by
decreasing sunk costs and barriers to entry. The extent to which this occurs depends
on various things, such as the market penetration of the technology and the kinds of
services provided. For example, consumers still rely on ATMs and branches to access
cash. Even this dependency may be falling, as consumers rely more and more on
cashless payments and on practices such as “cash back,” which allows them to obtain
Remote banking is currently most relevant to the deposit market, providing an easy
way for consumers to check accounts, transfer balances, and make payments. It is
increasingly being used for asset management, through links with brokerages and
such as mortgages. The competitive benefits of remote banking may differ for
different products.
utilities, airlines, retail stores, restaurants, manufacturers, and wholesalers face the
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relationships with customers has been given a high priority by the majority of
purchase and use of the product (Albrecht, and Zemke, 1985). In their book The Real
Heroes of Business . . . and Not a CEO among Them, Fromm and Schlesinger (1994)
observed that we have entered the age of boundless competition, triggered in large
competition has increased dramatically in recent years, and this means a one-world
market exists for products ranging from cars to computers. To compete successfully
in markets where products are the same or very similar, and prices are basically the
same, service is often the only competitive advantage available, they stressed.
want and use this information to create satisfying products and services (Pride and
Ferrell, 1997). Federal Express redefined mail service by providing over-night, door-
to-door delivery of packages and letters. The company discovered a need for speed,
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well-conceived service strategy, customer-driven systems, and customer-friendly
to discover the customers‟ needs and wants; a clear vision of the firm‟s „„reason for
being‟‟; and clearly stated beliefs and values that guide the enterprise (Albrecht and
Zemke, 1985). Many organizations are creating a written vision or mission statement
that directs the energies of the company and inspires employees to achieve greater
heights. Ortho Biotech, based in Raritan, New Jersey, begins its vision statement with
a bold prediction; „„we will be the best in our business by providing customers with
related science‟‟ (quoted in Lee, 1993). The creation of a sound set of beliefs and
values can give stability to an organization, as customer service priorities also become
clearer.
Ben Edwards, chairman of A.G. Edwards and Sons, Inc., the seventh-largest securities
firm in the nation, says following the Golden Rule is still the best way to achieve
success in business (Kegley, 1990). He is of the opinion that this attitude has had a
Service systems are made up of all the various practices and procedures that personnel
can use to meet customer needs. When you check into the Hyatt Regency Crown
Center in Kansas City, Missouri, you are given a card that says, "Call 50 for a
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response to any concern within five minutes" (Manning and Reece, 1998). MBNA
call answered within two rings. Employees achieve this goal nearly 100 percent of the
time (Reece and Brandt, 1999). These examples are typical of the steps being taken by
companies that want to meet, and in some cases exceed, the expectations of their
Carlzon (1987), in his Moments of Truth, had this to say;„„in many cases, the
people.” According to him the front-desk clerk or the queue walker at the banking hall
often has the first opportunity to serve the customer. Unfortunately, too often these
employees earn low pay, receive little formal training, and are given little recognition
for the important duties they perform. The best frontline employees are both
competent and caring. They have a certain level of maturity and possess the social
Several studies analyse competition in the banking industry over time. The key ones
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2.6.4.1 Competition and Time:
Nathan and Neave (1989), Molyneux et al. (1994), Hydroyiannis et al. (1999), De
Bandt and Davis (2000), and Mkrtchyan (2005) have researched into competition and
time. Their research disclosed that competition gradually changes over time. Some of
these studies analyse relatively short sample period of three to five years using the
Panzer-Rosse (P-R) approach. Most of the studies used different measures of banks‟
statistics.
Weill (2004 as cited in Casu and Girardone 2006) investigates the relationship
between competition and efficiency and concluded that increased competition breeds
efficiency. The author used a stochastic parametric method and the set of independent
variables include macro economic factors (GDP per capita and density of demand), an
geographical location.
Van Leuvensteijn et al. (2008) researched into competition and lending in the Italian
banking industry. The Boone indicator of competition was applied on banking firms
of eight major countries during the 1994-2004 periods. They concluded that a fairly
stable level of competition, slightly increases over time, even when concentration
increases. Angelini and Cetorelli (2003, Hauner and Peiris, 2005) also analysed a
longer time span, focusing on the Italian banking industry during the years 1987 to
1997.
64
They estimated yearly Lerner indices of competition for a cross-section of Italian
banks. Subsequently they explained these indices from a range of determinants, such
variables and a time dummy distinguishing the period before and after the Second
Banking Directive.
The name bank derives from the Italian word banco meaning "desk/bench", used
during the Renaissance by Florentine bankers. However, there are traces of banking
activity even in ancient times.In fact, the word traces its origins back to the Ancient
Roman Empire, where money lenders would set up their stalls in the middle of
enclosed courtyards on a long bench called a bancu, from which the words banco and
bank are derived. As a money changer, the merchant at the bancu did not so much
invest money as merely convert the foreign currency into the only legal tender in
The definition of a bank varies from country to country. Under English common law,
specified as; conducting current accounts for his customers, paying cheques drawn on
65
In most English common law jurisdictions there is a Bills of Exchange Act that
codifies the law in relation to negotiable instruments, including cheques, and this Act
contains a statutory definition of the term banker: banker includes a body of persons,
because it ensures that the legal basis for bank transactions such as cheques do not
The business of banking is in many English common law countries not defined by
statute but by common law, the definition above. In other English common law
business. When looking at these definitions it is important to bear in mind that they
are defining the business of banking for the purposes of the legislation, and not
necessarily in general. In particular, most of the definitions are from legislation that
has the purposes of entry regulation and supervision of banks rather than regulating
the actual business of banking. However, in many cases the statutory definition
account, paying and collecting cheques drawn by or paid in by customers, the making
of advances to customers, and includes such other business as the Authority may
prescribe for the purposes of this Act; (Banking Act (Singapore), Section 2,
Interpretation).
receiving from the general public money on current, deposit, savings or other similar
account repayable on demand or within less than three months or with a period of call
66
or notice of less than that period; paying or collecting cheques drawn by or paid in by
customers.
Since the advent of EFTPOS (Electronic Funds Transfer at Point Of Sale), direct
credit, direct debit and internet banking, the cheque has lost its primacy in most
banking systems as a payment instrument. This has led legal theorists to suggest that
conduct current accounts for customers and enable customers to pay and be paid by
In Ghana the use of the word bank is stated in section 17 of the Banking Act, 2004
A person, other than a bank shall not describe itself out as a bank, or carry on banking
in the country. The use of the word „‟bank‟‟ in the name of an association of banks or
employees of bank formed for the promotion of mutual interest of its members shall
Ghana has a well-developed banking system that was used extensively by previous
governments to finance attempts to develop the local economy. By the late 1980s, the
banks had suffered substantial losses from a number of bad loans in their portfolios.
In addition, the depreciation of the cedi had raised the banks‟ external liabilities. In
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assets adjusted for risk and to establish uniform accounting and auditing standards
(Anin, 2000).
The law also introduced limits on risk exposure to single borrowers and sectors. These
Other efforts were made to ease the accumulated burden of bad loans on thebooks of
banks in the late 1980s. In 1989 the Bank of Ghana issued temporary promissory
The latter were then replaced by interest-bearing bonds from the Bank of Ghana or
were offset against debts to the bank. Effectively, the government stepped in and
repaid the loans. By late 1989, some ¢62 billion worth of non-performing assets had
been offset or replaced by Central Bank bonds totaling ¢47 billion (ibid).
In the early 1990s, the banking system included the Central Bank (Bank of Ghana),
three large commercial banks (Ghana Commercial Bank, Barclays Bank of Ghana,
and Standard Chartered Bank of Ghana), and seven secondary banks. Three merchant
banks specialized in corporate finance, advisory services, and money and capital
market activities: Merchant Bank, Ecobank and Continental Acceptances; the latter
These and the commercial banks placed short-term deposits with two discount houses
Discount House and Securities Discount House, established in November 1987 and
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June 1991 respectively. At the bottom of the tier were some 100 rural banks which
accounted for only 5 percent of the banking system‟s total assets (ibid).
By the end of 1990, banks were able to meet the new capital adequacy requirements.
Company in 1991 to help distressed but potentially viable banks to recapitalize. The
(FINSAP) in response to requests for easier access to credit for companies hit by the
policies of the Economic Recovery Programme. The company was a joint venture
between the Bank of Ghana and the Social Security and National Insurance Trust.
Despite offering some of the highest lending rates in West Africa, Ghana‟s banks
enjoyed increased business in the early 1990s because of high deposit rates. The Bank
of Ghana raised its rediscount rate in stages to around 35 percent by mid 1991, driving
money market and commercial bank interest rates well above the rate of inflation,
thus making real interest rates substantially positive. As inflation decelerated over the
year, the rediscount rate was lowered in stages to 20 percent, bringing lending rates
At the same time, more money moved into the banking system in 1991 than in 1990;
time and savings deposits grew by 45 percent to ¢94.6 billion and demand deposits
rose to ¢118.7 billion. Loans also rose, with banks‟ claims on the private sector up by
shrink in 1991, falling to a mere ¢860 million from ¢2.95 billion in 1990, a reflection
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Foreign bank accounts, which were frozen shortly after the PNDC came to power,
have been permitted since mid-1985, in a move to increase local supplies of foreign
exchange (ibid).
The Ghana Stock Exchange began operations in November 1990, with twelve
companies considered to be the best performers in the country. Although there were
government hoped that share ownership would encourage the formation of new
companies and would increase savings and investment. After only one month in
operation, however, the exchange lost a major French affiliate, which reduced the
By the end of 1990, the aggregate effect of price and volume movements had resulted
however, and by midJuly 1992, 2.8 million shares were being traded with a value of
¢233 million, up from 1.7 million shares with a value of ¢145 million in November
1991. The market continued to be small, listing only thirteen companies, more than
In June 1993, the government removed exchange control restrictions and gave
without prior approval from the Bank of Ghana. In April 1994, the exchange received
a considerable boost after the government sold part of its holdings in Ashanti
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2.7.2.1 Overview of Ghana Commercial Bank (GCB)
The Bank of the Gold Coast, the parent company of Ghana Commercial Bank
operations in 1953. The Bank was set up as a semi government bank to cater for the
needs of the Gold Coasters and operate to the benefit of African industry, agriculture,
The Bank of the Gold Coast undertook both central and commercial banking
functions. The bank‟s name was changed to Ghana Commercial Bank in 1957 upon
the attainment of independence when Central Bank activities were hived off to the
newly created Bank of Ghana, leaving Ghana Commercial Bank to perform the
At the time of independence, there were only three banks operating in Ghana, namely;
British Bank of West Africa, Barclays Bank DCO (Dominion Colonial and Overseas),
and the Bank of the Gold Coast. The Bank of the Gold Coast was the only indigenous
bank as the other two were expatriate banks. (Anin, 2000). In 1996, Ghana
Commercial Bank changed its legal entity from a statutory corporation to a company
registered under the Company‟s code and subsequently floated shares on the Ghana
Ghana Commercial Bank operated as the only indigenous bank from independence
until NIB and ADB were established in 1963 and 1965 respectively. The bank held
the bulk of government accounts and had the greatest share of the industry‟s deposits.
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From a modest beginning of three (3) banks at independence, there as many as twenty
six (26) universal banks operating in Ghana as at September 2009 in Ghana with
The bank currently operates 157 branches and 11 agencies as at December 2009
linked together by means of wide area network (WAN) to its advantage, but it seems
this ambitious expansion drive has not translated into any exceptional financial
performance.
The Bank‟s mission is „„to be the established leader in banking, satisfying the
and high quality services through the optimization of information technology and
For the achievement of its mission, the Bank is committed to; the provision of first
class customer service, focusing on the Bank‟s core business competencies – banking
constant improvement in the use of information technology, ensuring that staff are
well motivated and have a conducive work environment, recruiting and retaining the
best human resources to carry out the Bank‟s mandate applying the best internal
shareholder value.
72
Professionalism - Highest banking and ethical standards.
achieving targets.
community, belonging to one family. The above beliefs, principles and practices are
supposed to guide staff of GCB in order to achieve the Bank‟s mission, do these
values really exist or to what extent are they embedded in the staff? In the activity
report of the Professional and Managerial Staff Union(PMSU) August, 2008, it noted
Branch managers are unable to visit customers on regular basis. They are also unable
to go out to look for new business. Delays in rendering prompt and efficient services
and courtesy in handling customers. Poor attitude of staff to customers and the use of
temporal staff at the front desk. The lack of good customer care has dented the
corporate valuesand action should be taken to improve customer care in the Bank.
73
CHAPTER THREE
METHODOLOGY
3.0 Introduction
This chapter describes in detail the methods used, specific steps taken and the tools
employed in the collection and analysis of data needed to address the research
conducted. This includes the theoretical and philosophical assumptions upon which
research is based and the implications of these for the method or methods adopted;
(Saunders et al,2007).It is the study of the method(s) of research that helps to identify
vital data which makes solution of the research problem possible (Encarta
Dictionary). The methods specifically refer to the techniques and procedures used to
samples. According to the law of statistical regularity, higher degree of data gives
higher degree of stability and vice versa. However, censuses of very large populations
Considering the size of GCB in respect of geographical extent and number of staff ie.
Over 168 branches and agencies spread over the regions and districts of Ghana with
2298 staff the researcher deems the population too large for individuals in all
Sampling therefore becomes worthwhile in order to have a size manageable for the
study. It has been advocated that it is possible to achieve greater accuracy by using
74
appropriate sampling technique than by a complete enumeration of all the units of the
population. This choice of individuals is as a result of the fact that Management and
Retail Managers are responsible for the formulation and day to day implementation of
strategy respectively.
or tested to obtain statistical data or information about the whole population (Encarta
sample (ibid). A sample size of four hundred (400) respondents out of apopulation of
To ensure that all the various groups in the sampling frame were surveyed,
or convenience sampling technique was used because this research focused only on
stratification of GCB‟s staff population since the researcher‟s concern was not to
capture all the various sub groups within the entire staff of GCB (both Management
and non management staff). However, a conscious effort was made to make the
75
Managers and 7 General Managers. Members of the Board were not easily
accessible.
3.2.1 Population
The complete set of cases from which a sample is selected is called the population
whether it describes human beings or not (Saunders et al, 2007). Wikipedia notes that
from which data can be gathered or analyzed. In the Oxford Advanced Learners‟
Dictionary, population is defined as all the people who live in a particular city,
country or area.
For purposes of this research the population of study comprises Management and staff
Both secondary and primary datawas collected for the purposes of this research. For
clarity, Saunders et al, (2007) define data as facts, opinions and statistics that have
Primary data is data that is used for a specific purpose for which it was gathered. For
76
management, General Managers, Area Managers, Retail and Operations Managers of
GCB.
Secondary data refers to data that is used for a purpose other than for which it was
for the research was collected by reviewing textbooks, journals, articles, magazines,
Commercial Bank and newspapers such as the Business and Financial Times, and
research data from renowned authors and researchers. Notable publications include
GCB‟s internal newletters The Eagle, Commerbank News and Quarterly Economic
Review. The bank‟s Planning and Research Department also came in handy with a lot
of data.
There are various methods by which both secondary and primary data are obtained.
group) and observation as methods that are usable. For this research the method
employed was the survey. The instrument used for the collection of relevant data for
77
3.6 Questionnaire
questions giving respondents a choice from a range of answers based on the 5- point
Likert-style rating scale. They had choices either to agree or disagree with the
statements made within the range. This was to ensure that the choice of answers
directly addressed issues at stake and make collation and analysis of the data simple.
intranet and e-mailed to staff. The rest were either hand delivered personally or
mailed to staff.
Furthermore, in-depth interviews were held with the managerial staff of Ghana
Commercial Bank Limited to solicit answers, opinions and suggestions on the study
because of the peculiar knowledge they possess on the subject under study. This
involved the use of semi-structured open-ended questions to allow for free, but brief
expression of relevant ideas, opinions and suggestions that might not have been
The questions were grouped under six sections; Section A to Section E each with six
included age, gender, marital status, educational background, income level etc.
Sections B to Section E were categorized under headings that dealt with each of the
78
importance of the research was explained to the respondents and they were
encouraged to be truthful and diligent with their responses to make the research
worthwhile.
After receiving the answered questionnaires, they were thoroughly examined to find
coded.The study used descriptive tools in the analyses of the collected data. The
descriptive tools included bar charts, pie charts and tables to analyze the data
statistically. The reason for the choice of the above methods, was to give a pictorial
79
CHAPTER FOUR
4.0 Introduction
This chapter looks at the presentation, discussion and analysis of data collected from
the field. Research findings constitute very important stages of the research exercise.
It is an integral part of the survey and it is affected by its overall quality. The findings
are normally reported with respect to furnishing evidence for each research questions
asked to guide the study. This study presents the results of the study and the findings.
Out of a population of 2298 staff, a sample size of 400 was chosen for the study.
analysed.
Descriptive statistics was used in presenting the data. Frequencies, percentages and
charts were employed to explain certain points where necessary.This section gives
detailed information on the findings of the study and detailed discussion on responses
obtained from the various questions posed to the respondents as well as the analysis of
the findings.
Samples were selected based on targeted units using the non-probability sampling
that representative samples of all the known elements of the population occur in the
80
sample. A sample size of four hundred (400), comprising fifty (50) managerial staff
and three hundred and fifty (350) non-managerial staff of the targeted population
Respondent Distribution
As indicated in Table 1, 12.50% of the respondents were managerial staff, while the
non-managerial staff registered the remaining 87.50%. The research further revealed
that the administered questionnaires exhibited a ratio of 1:1.7 with regard to male and
female distribution respectively with the female almost doubling that of the male, as
81
Fig. 4.1 Gender Ratio
Male Female
239 251
149
111
38
12
The ratio is an indication of enough evidence that there are more women in the bank,
tellers. Thus this is an indication that both men and women were fairly represented.
The ages of (staff) respondents are within the range of 18 to 58 years. The staff age is
skew distributed towards 18 – 49 years with the modal age group being 26 - 33 years
which represents 35.5% of the respondents; this was followed by the 18 - 25 year
group scoring 21.5% of the respondents and the 34 – 41 years group registering
the respondents as shown in Table 2 and Fig 2. Thus, the study indicates that GCB has
a mixture of large number of young and energetic workforce. Staff who are nearing
the retiring age (58 – 60) are in the minority, accounting for 6.75%. However, within
the next decade, the bank has to recruit at least 10.5% new workforce since the 50-57
82
Table 4.1.2: Ages of Employees
21.50%
20.00%
12.50%
6.75%
3.75%
Table 3 depicts ranges of years within which the respondents had worked with the
bank as staff. Out of the 400 respondents contacted 133 (33.25%) employees had
worked with the company between 16-20 years; which is also the modal group of the
and 20 [5.00%] managerial staff had worked with the bank between 11 and 15 years.
83
Another 96 of the respondents had also worked between 6 and 10 years; closely
followed by 35 [8.75%] respondents having been with the bank between 1 and 5 years
Frequency Percent
Non- Non-
84
The above data is picturesquely illustrated below as Figure 3.
Figure 4.3
21-25 yrs
16-20 yrs
TOTAL
11-15 yrs
MANAGERIAL STAFF
NON-MANAGERIAL STAFF
6-10 yrs
1-5 yrs
The various positions held by staff or role that the various respondents play at the
bank is represented in three (3) major levels (Lower, Middle and Senior). At GCB,
frontline executives and clerical roles constituted 87% or 350 of the 400 staff while
the middle level executives or supervisory roles which are basically Retail (branch)
85
Figure 4.4: Current position held at GCB
3%
10%
Lower Level
Middle Level
Senior Level
88%
Respondents indicated several reasons for the strategic decision for the adoption of
computerization and networking of all the operations of the bank and its impact
receives increased income through taxation and the public welfare has always been
The research revealed that its nationwide network was affirmed by an overwhelming
100% respondents indicating that they „strongly agree‟; the same response went for
86
the notion, „GCB gives timely accurate report to clients‟. 87% respondents were
neutral to the notion that „GCB sends renewal notices electronically to clients‟, while
the remaining 13% disagree; and „GCB‟s ICT ensures accurate tracking and re-
payment of loans‟ had 65% agreeing, 24% neutral and 11% disagreeing.
decentralized and
The bank‟s intranet service should be optimally utilized to reduce most of the
paper work and thereby reduce customer waiting time at the various banking halls
The staff should receive adequate training in order to utilize the ICT
The study brought to the fore the fact that GCB has a department whose sole
management.
87
The research revealed that in general terms, GCB is implementing the cost leadership
executive of the bank reiterated that it is cheaper doing business with GCB, hence the
Even though the questionnaire provided slots for up to five strategic plans
implemented by the bank, responses indicated that the bank had since 1990
religiously implemented its strategic plans; and 99% of respondents showed that it has
over the years „positively‟ impacted on its general performance and output, while the
rest were not too sure. An executive buttressed the point that the strategy to fully
automate the operations of the bank by the use of ICT was aimed at enhancing
productivity and expanding customer access to the branches and ultimately increase
profitability.
When respondents were asked to indicate whether or not GCB enjoys competitive
advantage in the banking industry, 75% responded in the affirmative and 25% held a
contrary view. For those who indicated that the bank enjoys a competitive advantage,
they showed the following in the order of choice as the source of competitive
advantage; 76% for pricing strategy, 20% for distribution strategy, 3% for promotion
This research in the quest to ascertain the most important strategies currently been
operated vis-à-vis the competitive advantage it brings to the bank is illustrated below:
88
Table 4.1.4: The Most Important Strategy
According to 35.75% of the respondents, the extensive branch network is the most
place is the bank‟s large customer base for which 21.7% respondents voted. The
bank‟s low charges and transaction fees was adjudged the third most important factor
with 19.00%. Easy access to loans was ranked fourth with 17.25% followed by key
accounts held by the bank. Customer service showed just 2.5% (the least important of
The strategic plan must be abreast with recent positive developments in the
banking industry and the economy at large. It should capitalize on the oil find and all
that it brings.
Frontline staff should be involved in the drafting of plans for their valuable
89
The extension of branch network should be complemented with good
customer care to win and maintain customers including key customers lost.
In general, GCB is seen as a bank with a good reputation. This is evidenced by the
over 80% positive response in favour of GCB‟S reputation. On branch ambience and
attractiveness of offices, the following responses were obtained; 45% strongly agreed
that GCB branches were attractive and pleasant, 40% also agreed with the assertion,
On the issue of GCB being a pacesetter in terms of product innovation, 35% agreed
with the statement, 12% were neutral, and 53% disagreed with the statement.
The bank is seen as a good corporate citizen, this was represented by 85% of
90
Table 4.1.5: Image/Reputation
4.5 Profitability
Research revealed that the profitability of the bank is guaranteed since GCB accounts
show increasing profits year after year, 89% of respondents see GCB as a profitable
agreed with the statement that GCB is viable, the remaining 90% also agreed on
91
Table 4.1.6: Profitability
92
CHAPTER FIVE
RECOMMENDATIONS
5.0 Introduction
survive in such a globally competitive market place. The banking industry is not left
out as far as the rise in competition is concerned. To survive, the banks have adopted
is no exception.
internal organisational resources and capabilities that cannot be replicated. This study
To diagnose the reasons for the success or failure of the strategies and suggest
alternatives.
industry.
93
In order to attain the research objectives the following research questions were posed.
Which strategies can best be practiced by the GCB to either gain or regain
competitive advantage?
Competitive Advantage
It was established that GCB enjoys competitive advantage in the Banking industry,
the main sources of the Bank‟s competitive advantage being its large geographical
spread of 157 branches and 11 agencies, and low charges for the range of services
Strategy
The bank is using a cost leadership strategy to achieve competitive advantage which
has been so far, working in its favour. The bank is enjoying the benefits of economies
of scale from its wide network of branches spread across the length and breadth of
Information Systems
The bank‟s decision to computerize and network all its branches was a deliberate,
and also provide easy access to banking services. The study found out that the
94
computerization has strategically positioned the bank to survive and attain the
Access to Credit
Easy access to credit is not one of GCB‟s strongest points, it placed a distant fourth
when the bank‟s most important strategies were ranked. Thus the bank could do more
bureaucracy in its credit delivery system ie. forwarding most loan applications to the
Profitability
The bank‟s accounts show increasing profits year after year indicating GCB‟s
viability.
Customer Service
Image/ Reputation
GCB enjoys a very good reputation which translates into goodwill and business for
95
Staffing Needs
The study indicates that GCB has a mixture of large number of young and energetic
workforce and personnel advanced in age nearing pension who are in the extreme
minority. However, within the next decade, especially, in the next two years
management has to recruit at least 10.50% new workforce since the older folks would
have retired.
5.2 Recommendations
In view of the findings of the research the following recommendations are made;
Customer Service
employed to render excellent services to customers. The bank needs to train staff,
Branch Ambience
The bank must rehabilitate and modernize its branch buildings and facilities to keep
up with trends in the banking industry. The bank must make it part of its culture to
comfortable even when they have to wait for longer periods of time.
96
Sustaining Competitive Advantage
Although, the bank is a cost leader, efforts must be made to step up its standard of
The bank should also take a second look at its interest rates to help get new customers
and stay competitive. GCB should be quick to respond to the frequent changes in the
market, especially cuts in Bank of Ghana‟s prime rate to avoid being under-priced by
its competitors.The bank could also lend to certain low-risk categories of customers at
very attractive rates in order to sustain its competitive advantage. Such low-risk
customers include public and civil servants, Ghana Education Service staff, Ghana
Health Service staff who are paid through the Controller and Accountant General‟s
Department. These categories of workers can have their loan repayments deducted at
Technology
The bank‟s ICT infrastructure should be regularly reviewed and updated to ensure that
they are using the most efficient technologies on the market. The current VSAT
(Very Small Aperture Terminal) technology in place at most of the branches should
make way for the faster Radio technology so as to reduce transaction times. The bank
should also improve its data back up systems to prevent the incidents of server down
offline.
97
Staff Motivation
It is highly recommended that the bank retains a well motivated staff with proper
conditions of service and a good pay package since they are the resource tasked with
the duty of carrying out any policy and strategy to help it stay in competition, they
should organize proper training modules to upgrade the staff to help them acquaint
Access to credit
The bank must streamline its loan application processes to make the bank competitive
in the area of short-term financing. Faster loan approvals are the order of the day, as
most of GCB‟ competitors are doing better in this area. The bank can hardly afford to
be left behind. In the same vein, the bank must increase the threshold of loans which
require approval by the Head Office Credit Committee by optimizing the use of IT in
5.3 Conclusion
The respondents fall between the ages of 18 to 60 and with such workforce the bank
can make long term plans to meet the competition in the market and help achieve its
goals and objectives. The competition in the banking sector has brought about a lot of
The strategic decision to adopt computerization and networking of all the operations
of the bank and its impact was to achieve efficiency in customer information
management and to provide the customers easy access to banking services at the
98
customers‟ own convenience; to strategically position the bank to survive and attain
the requisite competitive edge in the turbulent and intense industrial rivalry;
increased income through taxation and the public welfare has always been paramount
instances the focus differentiation strategy is adopted. The extensive branch network
seems to be the major strength that GCB holds as competitive advantage and has thus
resulted in the bank acquiring the largest customer base in the industry. Customer
services, on the other hand showed just 2.5% (the least of strategies that earned the
The research revealed that the profitability of the bank is guaranteed since GCB
accounts increases year after year by the 89% response and 90% vote on its viability;
90% indicates that GCB has a good investment portfolio just to mention a few.
The study delved extensively into the operations of Ghana Commercial Bank and has
thus identified several issues of concern which affect the competitive position in the
market. The adoption and implementation of the recommendations made by this study
99
5.4 Suggested Areas for Further Research
The study is a case study of one particular banking institution however, every aspect
of competition could not be studied let alone taking some of the core variables of
banking and subjecting them to a more analytical study to determine the extent to
which they can withstand competition using quantitative methods. As a result, this
makes it more appropriate to subject some of the variables such as profit of the
company, market share to determine the exact effect of the competition on them. A
100
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APPENDIX 1
Dear Sir/Madam
You have been selected to respond to this questionnaire for the study of “Achieving
Bank)”. You are assured that any information you provide is solely meant for the
research and nothing else. Your response to the questions will be kept confidential.
Thank You.
2. Age
18– 25years [ ]
26 – 33 [ ]
34 – 41 [ ]
42 – 49 [ ]
50 – 57 [ ]
58 – 60[ ]
1 – 5years [ ]
6 – 10 [ ]
11 – 15 [ ]
16 – 20 [ ]
21 – 25 [ ]
109
4. State your current position held at the bank.
…………………………………………………………………………………………
…………………………………………………………………………………………
1) GCB was among the first banks to computerize and network all its operations
…………………………………………………………………………………
………………………………………………………………………………..
…………………………………………………………………………………
affected the interests of various stakeholders of the bank over the period; customers,
…………………………………………………………………………………………
…………………………………………………………………………………………
………………………… ………………………………………………………………
110
3) In the following table, please tick whether you agree, strongly agree or disagree
Agree Disagree
5 4 3 2 1
…………………………………………………………………………………………
…………………………………………………………………………………………
…………………………………………………………………………………………
…………………………………………………………………………………………
111
SECTION C: COMPETITIVE ADVANTAGE
Committee?
Yes [ ] No [ ]
Please tick. 1[ ] 2[ ] 3[ ] 4[ ] 5[ ]
…………...............................................................................................................
d. Others (specify) [ ]
…………………………………………………………………………………………
……………………………………………………………………………..………….
...………….…………..………………………..………………………………………
Very Negatively [ ]
b) Please explain
…………………………………………………………………………………………..
…………………………………………………………………………………………..
………………………………………………………………………………………….
112
8. Does GCB enjoy competitive advantage in the banking industry?
Yes [ ] No [ ]
10. In the following table, please rank the following strategies in order of importance,
Strategy Rank
Superior customer
service
Extensive branch
network
Low bank charges
Large customer base
Easy access to loans
Key accounts held with
the bank
11. In your own opinion, how can planning for strategic competitive advantage be
improved at GCB………………………………………………………………………
………………………………………………………………………………………….
…………..………………………………………………………………………………
…………………………………………………………………………………………..
Yes [ ] No [ ]
113
13. In your own words, which aspects of the bank‟s strategy need improvement?
…………………………………………………………………………………………
…………………………………………………………………………………………
…………………………………………………………………………………………
…………………………………………………………………………………………
114
SECTION D: IMAGE OR REPUTATION
1. Inthe followingtable, please tick your extent of agreement or disagreement with the
following statements.
Agree 4 3 2 Disagree
5 1
GCB‟s positive
image is as a result
of planning over
the years.
GCB offices are
noted for their
attractiveness and
pleasant
environment.
GCB is recognized
as the industry‟s
pacesetter in
product innovation.
GCB is one of the
leading corporate
citizens in Ghana.
GCB is considered
as the all-round
best Ghanaian
bank.
115
SECTION E: PROFITABILITY
1. In the followingtable, please tick your extent of agreement or disagreement with the
following statements.
Agree Disagree
5 4 3 2 1
116