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Week 3: Case Analysis

The Story of Foreign Trade and Exchange
Comparative Advantages of Los Alamos National Bank
International Business
Keller Graduate School oI Management
Jul 2011

Name: Anh Nguyen
















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I had over 9 years working in banking industry. I always impressed by the banks oI US
because they are not only good in services and but also eIIiciency in operation. In this paper I
would like to introduce Los Alamos National Bank, the only one bank who received Malcolm
Baldrige National Quality Award until now. This award is the only Iormal recognition oI the
perIormance excellence oI both public and private U.S. organizations given by the President oI
the United States.
Los Alamos National Bank (LANB) was organized in 1963 by local investors. LANB is
as an independent community bank which provides convenient, Iull-service banking Ior
residents, businesses, and organizations make Los Alamos a city with a great Iuture. LANB is
locally owned and operated by Trinity Capital Corporation, a one-bank holding company. Now,
it is one oI the largest and strongest banks in the New Mexico state.
In 1995, Money magazine named LANB "the best bank in New Mexico." One year later,
Inc. magazine named LANB one oI the 26 "Banks We Love" Ior its service to small businesses.
In 2000, Los Alamos National Bank was the Iirst corporation in New Mexico, as well as the Iirst
bank in the nation, to be awarded the Malcolm Baldrige National Quality Award.
The bank is successIul because its management has been Iinding innovative ways to
exploit their comparative advantages as Iollowings:
- high on service, low on cost;
- emphasis on empowerment, innovation, flexibility
- leveraging technology

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In comparison to LANB`s competitors, the bank endeavors to be more 'customer driven
than those oI them. It is organized to identiIy customer needs more readily and more accurately
and, then, to respond more quickly and more satisIactorily. LANB`s competitive advantage
originates directly Irom relationships with their customers, local businesses and organizations
that drive the economy. LANB`s Employees volunteer in over 100 organizations in the
community. These activities involve in education, charity, healthcare, Iinance with products and
services needed by the community. Community relationships are LANB`s advantages and
strengths. The direct participation in the organizations, sponsorships, and event attract a large
number oI customers oI customers, Iriends, neighbors, and Iamilies toward the bank.
In order to meet customer needs, LANB`s service standards that provide clear direction
Ior all employees Ior example: 'Greet all customers positively and quickly, 'Know bank
products and services, ' Say, 'Here`s a way, not 'No way..
In its chosen markets, LANB has positioned itselI to be a low-cost, Iull-service provider.
In comparison to LANB`s competitors` rates oI deposit, LANB`s are higher than those.
However, the rates oI interest it charges Ior loans typically are reported as one oI lowest in the
market. This is its
Although LANB`s strategy has been low cost, LANB still has been successIul in
achieving proIitability oI the operations. EIIiciency ratio is essentially the percentage oI income
used Ior administrative expensessupplies, salaries, rent, depreciation, utilities, etc. that take
to operate the bank (lower is better). The eIIiciency ratio provides a view oI how hard and
eIIectively the employees work. 'On average, one LANB employee services more than $6
million in assets, which is more than twice the banking industry average. It is obviously that

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LANB`s eIIiciencies have been a result oI a commitment to organizational and personal learning,
individual achievement through empowerment, and good leadership.
The target oI LANB is to make the employee Iocusing on a career in banking, not a job at
the bank. For example, when someone asks a teller what he or she does, the answer is, 'I`m a
banker, and not 'I`m just a teller. Tellers interact with 90 oI its customers on any given
business day, so that they do are the image oI the bank in view oI customers.
They have been developing people by Iocusing on training and sharing authority to serve
customers. The employees are trusted and given responsibility to give customers the best service.
Everyone, including the CEO and President, serves customers. That is the reason why The
President`s oIIice located in the main bank lobby to be seen by employees every day assisting
customers.
It can be denied that LANB`s managers and supervisors have successIully encouraged
and motivated the employees to develop and utilize their Iull potential through Irequent inIormal
Ieedback on their perIormance and the Iormal perIormance appraisal system.
Thanks to early investment in inIormation system, the employees` eIIiciency is well
supported by the modern tools that make their jobs quickly and accurately. From the Iorecast
generated by the systems, employees, management team can analyze situations and give needed
alternatives strategy. This is very important Ior Iuture possibilities and long-term sustainability
oI LANB in the currently competitive market.
As oI March oI 2011, it had grown to 314 employees at 6 locations. The bank has
become an integral component oI its community. 98 oI Los Alamos customers are satisIied
with the bank, 94 oI Santa Fe customers are satisIied with the bank. According to LANB
proIile oI Baldrige, nearly 80 percent oI Los Alamos` 18,000 residents use LANB Iinancial

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services. Two-thirds oI residents consider LANB to be LANB`s primary bank, and 30 percent oI
all customers use Iive or more services, as compared with the national average oI 6 percent Ior
all banks.
The experience Los Alamos National Bank is one oI best success story that exploit
comparative advantages in the pursuit oI perIormance excellence.



















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ReIerence:
William C. Enloe, Chairman and ChieI Executive OIIicer, Steve W. Wells, President and
ChieI Administrative OIIicer Catherine G. McClard, Vice President, Customer Service, Timothy
O. Doyle, Vice President and ChieI Operating OIIicer Monie Hardwick Blum, Vice President,
Mortgage Loans Fidel L. Gutierrez, Senior Vice President, Jill Cook, Vice President, Human
Resources, LANB, Los Alamos, New Mexico. LOS ALAMOS NATIONAL BANK - 2000
BALDRIGE AWARD WINNER. The Journal of Innovative Management, Volume 7, Number 4,
Summer 2002
LANB application summary, Irom www.quality.nist.gov
Hill, Charles W. L. 'DMG-Shanghai, chapter 3. International Business: Competing in
the Global Marketplace (7th edition). McGraw-Hill, 2009.