UNIVERSITI TUNKU ABDUL RAHMAN

FACULTY OF ACCOUNTANCY AND MANAGEMENT (FAM)

FACULTY OF BUSINESS AND FINANCE (FBF)

ACADEMIC YEAR: 2022/2023

OCTOBER 2022 TRIMESTER

UKMM1011/UBMM1011 SUN ZI’S ART OF WAR AND BUSINESS STRATEGIES

GROUP ASSIGNMENT COVER SHEET

Course details

Faculty : Faculty of Science (FSC)

Year and Trimester of study : Y2T1, Y2T2, Y2T3, Y3T1

Lecture Group : L1, Wednesday (4-6pm) & Friday (8-10am)

Lecturer’s Name : Mr. Fong Chee Yang

Assignment Details

Company’s Name : Bank of China

Due Date : Week 5 (11 November 2022, Friday) by 5pm.

Important Note : Submission of assignment is the responsibility of the students

Students’ Details

No. Student’s Name Student ID Programme Lecture Class

(Arrange by alphabetical order) No. (L1, L2)
1. Chan Meng Hui 2100333 BM L1
2. Daryl Jayne Jerah 2101822 BM L1
3. Kalaiarasan Ramesh 2006641 LI L1
4. Kuhan Ryan 2102423 BM L1
5. Lau Xue Mei 2001744 BM L1
6. Melanie Ho Yenn Ting 2106296 CE L1
7. Phylicia Liu 2105407 CE L1
8. Yong Sin Yee 1903728 BM L1

Assessment Overall marks (%)

Group Assignment
 UNIVERSITI TUNKU ABDUL RAHMAN
FACULTY OF ACCOUNTANCY AND MANAGEMENT (FAM)
FACULTY OF BUSINESS AND FINANCE (FBF)

ACADEMIC YEAR: 2022/2023

OCTOBER 2022 TRIMESTER

UKMM1011/UBMM1011 SUN ZI’S ART OF WAR AND BUSINESS STRATEGIES

MARKING SCHEME FOR WRITTEN GROUP ASSIGNMENT

Marks Marks
No. Assessment Allocation Given
(%) (%)
1. Section A: Organization Background 10
• Brief introduction of the company (full company name, location, business, products, brands,
competitors, performance, etc.)

2. Section B: Sun Zi’s Art of War Theories: 20

Provide critical elaborations on the following theories:
• Theory 1: Those who arrive first at the battleground will have sufficient time to rest and
prepare against the enemy and those who arrive late at the battleground will have to rush
into battle when they are already exhausted
• Theory 2: The general is like the guardian of the nation. If the guardian is a thoughtful and
detailed person, the nation will be strong and mighty. However, if the guardian is full with
character flaw, the nation will be weak and vulnerable
• Theory 3: In war, it is better to go for swift victories rather than engage in prolonged
military campaigns
• Theory 4: In the conduct of war, there is no fixed situation and condition, just like water
has no constant shape and configuration
3. Section C: Contents 35
Explain your chosen company’s practices for each of Sun Zi’s theories provided.
- Please provide detailed explanations concerning critical incidents that happened in the
company.
- Please mention how the company overcame the challenge for each of the incidents
encountered.
4. Section D: Recommendations 20
- Based on your point of view, please recommend the solutions which used by the company in
Section C
5. Section D: Conclusion 5
- Summarize the report and explain what you have learned from this assignment.

6. Quality of the written assignment 10

- Format, layout, idea flow, languages, references, word count and structure.

Total Marks 100

(-) Minus (Non-compliance to structure/formats/instructions as stated in the Course Plan 2021
Oct)
NOTE: A total of 30 marks can be deducted due to non-compliance. Marks should be deducted
from the total marks of the assignment (if any).
NET MARK AFTER DEDUCTION OF NON-COMPLIANCES
 Table of Contents

NO. CONTENTS PAGES

1 Section A: Organization Background on Bank of China 1
2 Section B : Sun Zi’s Art of War Theories 2-3
3 Section C : Contents 4-7
Section D :
4 • Recommendations 8-9
• Conclusions 10
5 References -
6 Appendices -
Section A: Organization Background On Bank Of China

Bank of China is the China's oldest bank, which was formed in 1912 to take over and
replace the ‘Ta Ching Government Bank’. First, it was established as ‘The Hupu Bank’ in 1904
under the Qing Dynasty, the Imperial Ministry of Revenues. Later on, it was replaced and
altered to "Great Qing Bank" in 1908. (The Da Ching Government Bank) When Pu Yi, the
young Emperor, relinquished in favour of the brand-new Republic of China envisioned by Sun
Yat-Sen, the Chinese Imperial Court virtually ended. Alongside the "Big Four" banks of the
time the Central Bank of China, The Farmer's Bank of China, and the Bank of Communications
it printed currencies on authority of the Central Government from the era of its formation until
1942. First branch of the Bank of China had been opened in Hong Kong in 1917. In the year
of 1929, Bank of China had been expanded to London which was their first overseas bank
branch. After the Chinese civil war ended in 1949, Bank of China used its experience as the
government specialised international foreign monetary bank, and was able to manage China's
foreign-exchange operations after 1949 and significantly contributed to the growth of the
country's overseas trade and economic development. In 1994, BOC went through a
transformation to become a fully government banking institution that was formed as Bank of
China Limited in August 2004. Now, The Bank of China, which is currently the second-largest
lender in China overall and the eighth-largest bank around the globe by market valuation worth,
operates on the mainland. In June 2006, the Bank of China became the first Chinese banking
institution to make an A-Share and H-Share initially public offering and secure a dual listing
in both markets. The following month, it was listed on the Shanghai Stock Exchange.
Extending its participation as the exclusively financial partner for the 2008 Summer Olympics,
the bank was named in 2017 as the official banking associate of Beijing's 2022 Winter Olympic
and Paralympic Games. Moreover, Bank of China expanded their services over 57 countries
around the world and offers its clients a wide variety of financial services, and it has built an
integrated service platform based on the key elements of its corporate banking, personal
banking, stock institutions, and other commercial banking businesses. This platform covers
investment banking, direct investment, bonds, insurance, funds, aircraft leasing, and other
areas. There were top competitors in the list to compete with Bank of China for same type of
consumers and services such as Industrial and Commercial Bank of China (ICBC), China
Construction Bank, Agricultural Bank of China, HSBC, Citibank, and Standard Chartered
Bank. These banks provide competition amongst each other to offer and attract the new type
of clients for their lucrative services and offers.

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Section B: Sun Zi’s Art of War Theories

Theory 1 is found in Chapter 6 of Sun Zi’s Art of War, titled "Weak Points & Strong".
In war, the army that arrives first on the battlefield will gain the upper hand. The soldiers of
the army have sufficient time to replenish their energy before the battle begins. Besides that,
the general of the army would be able to survey the battlefield and plan the best position and
strategy for his army.

It is important to plan ahead when starting a business, as it allows a company time to

settle in, observe, and plan its marketing tactics (Eudaimonia, n.d.). By doing so, the company
has a firm foundation, as it will be more knowledgeable of the needs of its target consumers
and what strategies to use. The company should also attempt to start a business on something
new to the market. This makes the company the pioneer of the new market, allowing them to
have more control over the market trend and dominate it. When new competitors attempt to
join the market, it will be more difficult for them to catch up.

In Chapter 3 of Sun Zi’s Art of War, Theory 2 is mentioned, where it states that the
general is an important factor in ensuring a nation’s victory. Sun Zi said that the general is the
pillar and protector of the nation. The nation will be strong under the leadership of a good
general (Tenn, 2018). Whereas if the nation is under the leadership of a weak general, the
nation will be weak as well. It is the general's responsibility to ensure the safety and wellbeing
of the nation.

This can be applied to the business setting, where the leader must be in control of their
emotions and be knowledgeable (Storyshots, 2021). A leader must demonstrate that he is
trustworthy and capable enough that his superiors and subordinates can put their trust in him.
The leader of a company must make wise decisions lest they cause the downfall of their
company. This is because a leader’s decision would directly affect their team and company.

The statement from Chapter 2: Waging War, where it is also stated that the main goal
of war is to win the battle rather than to prolong it. This can be further clarified by saying that
men/soldiers will become weary and demoralised if the battle lasts a long period. The enemy
will take advantage of the opportunity to attack when both the men and the treasury are worn
out to minimise both human and financial costs. This theory can be used by businesses, which
should enter the market not to compete but to win. Participating in the market is a mediocrity-

2
producing mentality that may make businesses defensive and prevent them from making
difficult decisions.

The decision-making, planning, and attack execution skills of the leaders are critical to
the success of the effort to solve the issue quickly. Planning ahead and looting when in enemy
territory should eliminate the requirement for new recruit training and any resource waste in
order to conduct the war effectively (Tenn, 2018). In addition, a general who really knows the
advantages and disadvantages of using the military holds the life and death of the people and
able to dominates the safety and security of the country. When men are fighting, their output
decreases and they are more prone to distrust their commanders, which affects war results.

The quotes from Chapter 6: Weakness and Strength describe how to act like water
because it is strong both offensively and defensively. Armies are like water in that they avoid
the high ground and seek out the low, avoiding the powerful and engaging the weak (Pearson,
2020). The finest warrior may build triumph from opportunities created by the enemy because
the water and war do not possess a continuous form or energy. Additionally, water flows
according to the landscape and the army develops a winning plan based on the opponent.

As stated in Theory 3, the general plays a critical role in learning the natural principles
that govern the world and everything in it. This is to help him comprehend his opponent and
the ground on which his forces and the adversary will meet. The general can then act in
response to the enemy's movements to benefit his own troop. Consequently, just as there is no
set pattern in the use of soldiers in battle, victory is often determined by the ability to anticipate
the enemy's moves (Tenn, 2018). It also clarified that reacting to the circumstances on the
playing field is just as important for success as using grand strategy.

3
Section C: Contents

Bank of China is the second oldest bank in China. It was meant to replace Imperial
Bank of China, under the instruction of Dr Sun Yat-sen. Being the longest continuous operation
bank in China has given BOC some advantages. Bank of China served as China’s central bank,
international exchange bank and specialised international trade bank from 1912, for 37 years.
In result of this, BOC is now operating in 61 countries, making it became the most
internationally active among other China’s banks. Now, BOC still serve China as foreign trade.
It started to open a new branch in Hongkong in 1917. In 1929, the company opened a first ever
China’s bank branch overseas in London. Gradually, BOC grew its global network and from
1931-1947 the business already has branches in 34 different countries.

Other than that, BOC try to be quick to build a digitalized bank and always keep up
with the advancement in technology which is one of the bank’s strategies to “Enable
advancement through technology”. The bank values innovation, it tries to develop ideas and
learn from others. Having a strategy to “drive development through innovation”, the company
try to innovate the current technology, their product as well as their business. This open a
possibility to make the company be the first to create a fresh new idea.

BOC has followed the first theory, for being the first bank in China to open branches
overseas and for being the first China’s bank to be established. The business is still trying to
compete with other banks by trying to be fast to innovate and implement new technologies or
ideas. Bank of China was established under the demand of Dr Sun Yat-sen. Sun Yat-sen is the
first president of the Republic of China. Under his government, Chen Jintao is appointed to be
the minister of finance and in 1912 with Chen’s help, the Imperial Bank of China is successfully
changed to Bank of China. Chen Jintao became the founder and the first deputy advisor of
BOC. Imperial Bank of China was the Qing dynasty great strength, it would be a proper choice
to alter it into the new government’s central bank. This decision is voiced out by Chen Jintao.
Chen said that this is a way that can meet the requirements of both the new government and
shareholders to meet urgent needs, to increase national and financial strength with existing
funds by relying on bank. All the buildings and properties own by the Qing dynasty’s bank are
taken over by BOC.

In the process on transforming the late bank to Bank of China, Sun Yat-sen made a bold
choice. The choice is to give up the original state-owned shares of 5 million liang of silver
dollars which was used to paid losses and uncovered debts by branches of Imperial Bank of

4
China that is located in a war affected area. Even though the decision is bold, this is what makes
BOC is successfully established.

Sun made a wise choice in appointing Chen Jintao to be in control of this situation. In
that time period, Chen was regarded as one of China's most accomplished economists and
bankers. He is knowledgeable in printing money and uses the US printing technique, which, in
his opinion, is the most effective at preventing counterfeiting. He was also in charge of several
financial reforms, as well as innovations and advancements in printing and engraving.

From June 1946 to May 1949, domestic commodity prices rose 36 trillion times and
food prices rose 47 trillion times which is compared to pre-war period. One grain of rice has a
price of 130 yuan or more. The operation and management of the Bank of China were plagued
by rampant inflation and currency collapse.

When the Jin Yuan Quan was introduced during the August 1948 currency reform, the
Bank of China's 60-million-yuan capital was reduced to only 20 yuan, which could not
accurately reflect the bank's actual capital. In response to this matter, the Bank of China's board
of managing directors decided that out of all exchange surplus, securities surplus, and reserves
accumulated over the years totalling more than Jin Yuan Quan 308-million-yuan, Jin Yuan
Quan 60 million yuan should be set aside for capital appreciation through the issuance of shares
in an equal distribution. The total amount of Bank of China's capital was calculated to be Jin
Yuan Quan 60 million yuan given the 600,000 shares with a face value of Jin Yuan Quan 100
yuan each.
Bank of China (BOC) is the Chinese bank with the highest level of globalization, and
cross-border business is also one of BOC's traditional advantages. Since the outbreak of
Coronavirus disease (COVID-19), BOC has cooperated abroad to provide cross-border
remittance and payment services for imported anti-epidemic materials and medical supplies in
a timely manner. BOC always ensuring smooth global payment channels. On 27 January 2020,
a trading company in Taicang, Suzhou, Jiangsu raised 2 million yuan of donations, the
donations urgently have been used to purchase anti-epidemic materials such as a batch of masks
from overseas to donate to Wuhan. The company consulted several local financial institutions
about cross-border remittance during the Spring Festival but were told that it could not be
handled. The company contacted BOC Suzhou Branch that provides cross-border remittance
services, BOC Suzhou Branch then immediately contacted Taicang Branch to open an account
for the customers first since the trading company do not has a corporate account in Bank of

5
China so that they could conduct cross-border remittance operations. Although the complexity
has increased, Suzhou Bank of China set up a business emergency team which included 24
persons to fully cooperate with enterprises to complete cross-border remittances. With the
cooperation of BOC Head Office and Seoul Branch, BOC Suzhou quickly established a
remittance channel for remittances in US dollars to South Korea, and immediately notified
customers to go to Taicang branch to complete corporate account opening. Unfortunately, this
purchase was unsuccessful due to several reasons. The trading company then contacted a
Japanese supplier again on the 28th. Suzhou Bank of China acted quickly and re-coordinated
with Bank of China's head office and overseas branches. Taicang Branch quickly handled the
foreign exchange purchase and cross-border remittance procedures for customers and waived
all handling fees in just half an hour. Soon, the Tokyo branch also sent the message to the
beneficiary bank as soon as it received it and waived all transfer fees. The first payment of 6
million yen was successfully paid on the afternoon of the 28th with the cooperation of all parties.
After received the payment, the Japanese supplier started to deliver the goods.

On the 29th, the final payment of 14.46 million yen was paid through the Taicang
branch after the trading company confirmed the final shipment quantity with the Japanese
supplier. Another example was on the 29th, Bank of China Hebi Branch received an emergency
call from the Municipal People's Hospital. The hospital urgently needed funds to purchase
medical supplies and equipment. Hebi Bank of China immediately reported the situation to
Bank of China Henan Branch and put forward the demand for holiday loans. Three hours later,
the Henan Branch completed the issuance review process with the cooperation of various
departments of BOC. Finally, Bank of China Hebi Branch agreed that a loan of 30 million yuan
was issued to the Municipal People's Hospital, and the loan funds were safely received by the
hospital (Bank of China, 2020).

The outbreak of Coronavirus disease (COVID-19) cause lockdown of the country, it

gave a big impact on countries, governments, businesses, and companies in all industries
everywhere especially the economics of the country. Bank of China gathered speed to work on
a Business Continuity Plan (BCP). All business departments of BOC rapidly planned the
actions and measures for every scenario to ensure the business operations is continued and
safeguard of their customers and employees. In the BCP, work from home policy have
implemented for the staff. In addition, BOC would also ensure the essential staff working onsite
follow a strict shifting schedule. Bank of China has provided a regular communication channel
on important updates and precautionary measures of COVID-19 through company group chat

6
and emails to all employees. COVID-19 briefings also have been conducted for all the
employees so they can know more about COVID-19 and the ways to take care of themselves
and their families. The team had learned how to effectively work from home, work on shifts,
access customer data and information outside the office, communicate with both clients and
operations teams. The company learned how to recover quickly from the difficulties and
challenges brought by the new working environment during the pandemic. Even with a firm
Business Continuity Plan in place, it was the operational details of the day-to-day transactions
and customer engagements that the company had to overcome. BOC has always rallied for
more process improvements and changes during this pandemic. Additionally, new monitoring
processes have been implemented for faster communication and coordination with other bank
units can done through mobile apps. Process changes have been suggested and implemented
for improvements and more efficient processing of the bank. All of these were achieved
through the team’s resilience and innovation during the current situation (Bank of China, n.d.).

7
Section D:

Recommendations

As mentioned in Section C, Bank of China must be quick in innovating and

implementing new ideas to maintain its foothold as China’s leading internationally active bank.
In doing so, Bank of China can apply Sun Zi’s theory which is “Compare them against (those
of the enemy) so as to understand the changing conditions and circumstance (of war) and to
assess the chances of victory”. As more advanced technology come into existence, Bank of
China must first understand the demands of the different countries to best leverage digital
technologies to connect the customers’ as well as employee’s needs. Bank of China can adopt
a decentralised structure, meaning more freedom is given to the branches at different locations
to make decisions best suited to the respective environments. This allows the employees to
engage better with the local customers and satisfy their needs and concerns better, thus giving
Bank of China the knowledge on what new technology can be implemented to give the greatest
advantage against other competitors.

Sun Zi states “Thus it is that in war the victorious strategist only seeks battle after the
victory has been won, whereas he who is destined to defeat first fights and afterwards looks
for victory” (Changingminds.org. (n.d)). In the second incident, Bank of China faced a sudden
drop in its capital due to the currency reformation. To counter future situations like this, the
general, or in this case the managing directors, must be able to think long term and see the
bigger picture to make the best possible decisions when needed. They must be able to recognise
good opportunities in assessing risks and take them, enabling the organisation to experience
exponential results or have a better chance of adapting in adverse situations. They must stay
inquisitive and resilient, staying grounded even in times of difficulty.

To increase the positive impacts and lessen the negative implications in Section C,
various modifications must be made. Foremostly, as Sun Zi had mentioned, “Those who are
victorious plan effectively and decisively. They are like a great river that maintains its course
but adjusts its flow. They have form but are formless. They are skilled in both planning and
adapting and need not fear the result of thousand battles; for they win in advance, defeating
those that have already lost”. As dreadful times disrupt a company's regular operations, the
company's leadership must establish a sophisticated and rationalised strategy that will have a
positive effect on the business by preventing disruption from outside sources like competitors.

8
For example, Bank of China may become the prey for bankruptcy if it does not promptly adopt
a new strategy to calm the tense situation and keeps temporarily suspending operations during
the COVID-19 outbreak. This scenario occurs when the leadership refuses to implement a
quick-thinking approach that could do a lot for the business during an onerous moment.

In spite of that, Sun Zi had also said, “Quickness is the essence of war”. An authority
or a leadership must act swiftly and rationally to prevent a certain situation from going
downhill. As a representation, an epidemic could have occurred if Bank of China neglected the
urgent payment notice from the Social Security Bureau of Shanwei City as the cost for treating
pneumonia infected patients. This sort of scenarios might occur if the obligated authorities fail
to practice celerity to avoid a trepidation.

9
Conclusion

As a conclusion, Bank of China has transformed into one of the most successful banks
in the world. It revolves around the development inside of the organization and operations.
Bank of China has revolutionized their own strategies to evolve as a successful commercial
bank in the world. They are well prepared against their competitors in their competitive market
to sustain their business among the competition. It is a huge battle to survive those competition
either in nationwide or internationally which has led them to open their chains in 55 countries
in the world. The owner of the Bank of China emerged as a good leader with a vision to develop
their business and sustain in the competitive battleground. The vision of Chen Jintao helped to
develop the Bank of China as the fourth largest bank of operation in the world. Bank of China
also understands that there are no fixed circumstances that may arise and can foresee that any
acts of God or pandemic situations can happened in the future. Therefore, they remain ready
to face the situation and grow the business, although there strong competitors exist. We can
learn from Bank of China that to achieve something there must be a plan and strategies to go
towards success.

10
References

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 APPENDIX

PLAGIARISM REPORTS