Bank of America: Merrill Lynch - Essay Example

? Bank of America: Merrill Lynch (e-CRM) Table of Contents Introduction 3 Strategic Context 4 Company Initiative 7 Results/Conclusions 9 References 11 Introduction Bank of America Merrill Lynch is recognized as the investment and corporate banking division of the parent organization i.e. Bank of America. This assignment will discuss about the e-CRM business operation strategy that has been adopted by Bank of America Merrill Lynch in the business processes. This assignment will apply several strategic analytical tools in order to determine the competitiveness of the organization by adopting the e-CRM business initiatives. Bank of America Merrill Lynch generally provides services, lending, trading, research, risk management, debt and equity capital markets, mergers and acquisitions, payments and liquidity management. The organization was established through the combination of investment and corporate banking activities of Merrill Lynch and bank of America. The organization operates within the Financial Services Industry. It has its strong presence in several leading global areas, such as countries in Latin America, Asia Pacific, Europe, Middle East, Canada, United States and Africa (Bank of America, 2013, p.1). State Street Corporation, Vanguard Group, Franklin Resources Inc. and Capital World Investors are the major clients of the Bank of America Merrill Lynch. The employee strength of the organization is 2, 67,000 and have 2.2 trillion US dollars in assets (Corporate, 2012, p.21). The organization is popular among the customers and business clients due to effective customer services and adoption of unique and customer friendly business operation strategies in the business processes. Bank of America Merrill Lynch introduced an effective online security message delivery system for the customers. It is effective e-CRM software that helps to deliver all the account information to the computer desktop of the cardholders. This exclusive customer service concept and facility helped the financial services organization to receive the recognition of the industry at the prestigious 2009 credit card awards. This application software helps the people to maintain the security of their personal accounts. Strategic Context Global business environment is becoming highly competitive as several leading organizations within a similar industry is implementing unique business operation strategies in the business processes in order to achieve potential competitive advantages. Bank of America Merrill Lynch’s new operation strategy will be evaluated and analyzed through the following strategies. Porter’s Generic Strategy According to the generic strategy of Michael Porter, an organization always positions itself by controlling its strengths. The strength of an organization depends upon two aspects, such as differentiation and cost advantages (Adler, 2006, p.102). Cost Leadership Strategy MBNA is known as one of the leading personal banking advisors. Bank of America Merrill Lynch adopted the application software of MBNA in the year 2008. In addition to this the organization used ATG CRM software in the business process in order to meet the satisfaction level of the customers. The bank always tries to implement advanced technology in the business operation process in order to reduce the business operation cost. It is important for an organization to reduce the business operation cost in order to maximize business profit (Ahlstrom and Bruton, 2009, p.52). Bank of America Merrill Lynch ensured cost leadership by implementing advanced technological CRM software in the business process. Differentiation Strategy Each and every organization tries to determine untapped market segment in order to attain customer loyalty. Bank of America Merrill Lynch offers different financial investment and saving plans to the customers (Albaum, 2006, p.99). Diverse and differentiated options help the global customers to take interest in the services and financial products of the bank. Focus Strategy The bank adopted several strategies in different global operating areas depending upon the economic condition and nature of the nation and the target customers (Baker, Walker, Mullins and Boyd, 1996, p.6). The organization always tries to focus on a niche market segment in different global areas. Effective investment plans help the organization to target customers of different income backgrounds. Value Chain Analysis There are nine elements in a value chain model, such as firm infrastructure, technology, human resource management and procurement. These four factors are considered as support activities. Inbound logistics, outbound logistics, service, operations, and marketing and sales are considered as primary activities (Barnes, 1997, p.31). Firm Infrastructure The organization maintains effective infrastructure of each and every bank. According to the management of Bank of America Merrill Lynch, effective infrastructure and physical evidence of banks can attract the customers effectively. The organization strongly believes in effective human resource management. It is true that the organization is implementing advanced CRM software and technologies in the business processes in order to satisfy the needs of customers and business clients. The management of the organization always tries to give effective training and development programmes to each and every employee to enhance their knowledge and skill (Besanko, Dranove, Shanley and Schaefer, 2013, p.65). Bank of America Merrill Lynch always tries to find cost effective vendors and resources as it helps to maintain cost leadership strategy in the business processes (Best, 2013, p.21). It is mentioned earlier that the organization always tries to implement advanced technological business strategies in the business processes in order to gain competitive advantages. Implementation of ATG e-CRM software application is the example of effective adoption of advanced technology. Effective service process and communication activities of the management with the employees enhance effective customer service and business performances (Bowen, 1990, pp.11-12). Customer centric services and effective value addition helped the organization to ensure strong customer service. Internal distribution, receiving and storing are highly scrutinized and distributed. The organization always tries to ensure high security in inbound logistics (Bookland, 2004, p.19). Outbound logistics of Bank of America Merrill Lynch is improved and advanced. The organization implements advanced mode of transportation and secured mode to dispatch cash in different locations. The organization uses social media, digital media and print media promotional activities in order to ensure effective brand and service awareness. Porter’s Five Force Analysis It is an industry competitive analytical tool that helps to determine the impact of industry competitive factors on the business performance of a particular firm. Buyer’s bargaining power is high due to low purchasing power of people, intense market competition and economic slowdown of the country. Suppliers’ bargaining power is quite low for Bank of America Merrill Lynch due to availability of huge number of technological and logistics instruments suppliers in the country. Threat of substitutes are high as several mutual funds, chit funds and insurance providing financial organizations are trying to develop potential client base around the globe (Fahy and Smithee, 1999, pp.8-11). Threat of New Entrants for Bank of America Merrill Lynch is low due to high legal entry barrier and saturated global market. Degree of industry rivalry is very high for Bank of America Merrill Lynch as several leading organizations such as JP Morgan, Deutsche Bank are competing with each other to increase global market share. Company Initiative It is clear from the above discussion that Bank of America Merrill Lynch implemented ATG e-CRM software application in the customer relationship management process to enhance effective relationship with the customers. It is known to all that Bank of America Merrill Lynch generally provides several differentiated services, research, risk management, debt and equity capital markets, lending, mergers and acquisitions, trading, and payments and liquidity management. In addition to this, the industry is getting highly competitive as several potential competitors of Bank of America Merrill Lynch are operating in several global market places in order to maintain grab its market share. Bank of America completed acquisition of Merrill Lynch and started to implement advanced technological applications in business process to ease the business operation process and satisfy the needs of target customers. Merrill Lynch was the independent organization before the acquisition. The management of Merrill Lynch decided to implement ATG software as an important e-CRM tool in order to improve the online customer relationship management services. However, Bank of America Merrill Lynch continued this process after the acquisition also. It helps to improve the online customer relationship management services options (Fischer and Wakefield, 1998, p.7). This online strategic management website was used to allow the users to view respective stock opinions that help them to view information and make purchases. On the other hand, Bank of America Merrill Lynch took the help from one of the leading personal banking advisor known as MBNA in order to increase the efficiency in the customer service management process. Users can get facility of Online up to date with secure existing account balance, latest offers, transaction updates, mini statements and several differentiated service facilities through the online desktop applications sources from MBNA (Bank of America, 2009, p.1). It is clear from the above discussions that the organization implemented MBNA e-CRM services in business operation. It is important for the organization to maintain effective and strong client base as the organization is trying to expand their business operations in global market places. In addition to this, ATG CRM software is another significant e-business operation tool that helps the organization to give effective solution to each and every problem regarding stock investment aspects. It is important for the financial service organizations and banks to give quick information to each and every user. It is true that organizations can gain huge customer loyalty if they bring automation in important aspects (Grewal, 2010, p.43). On the other hand, high security in the online transactions helped the organization to gain effective customer loyalty in the business processes. However, MBNA banking service provider offers Oracle development modules and codes in the e-CRM business operation process of Bank of America Merrill Lynch in order to gain significant competitive advantages. Several leading organizations within the global banking industry are trying to adopt and apply technologically advanced tools and applications in the business processes to reduce the threat of intense market competition and saturation. However, the operation processes like, account up to date, transactions and mini statements are highly automated that take care of the satisfaction level of each and every user. Each and every part of the e-CRM in Bank of America Merrill Lynch is effectively covered by the each and every module of and codes of Oracle. The management of the organization used to cover online transaction, mini statements and online up to date process of the accounts of several users by the modules and codes of oracle. It is important for the organization to maintain and monitor each and every aspect in this e-CRM process to maintain core competency in the business operation process (Gupta, 2011, p.82). The management of the organization implemented this technological tool in the business processes in order to increase the profitability and brand loyalty of the organization. The implementer of this process always tries to maintain effective relationship with the management and governing body of MBNA to continue effective business performances. Results/Conclusions It is clear from above discussion that the global banking industry is becoming highly competitive as several banks are trying to implement advanced technological applications to enhance effective CRM. The technology solutions are working effectively as these are designed to address several complex software application and key system integration requirements across the diverse environment of Bank of America Merrill Lynch. This integration of each and every module of Oracle helped the organization to retain its existing customers. In addition to this, the organization is always finding it easy to acquire new target customers through the integration of advanced e-CRM technological tools (Henning-Thurau and Klee, 1997, p.2). Bank of America Merrill Lynch can think about more differentiated and cost effective technological solutions in near future so that they can attract more number of target customers. Differentiated technological solutions will help the bank to provide different solutions to each and every problem that will be faced by the customers. It is important for the organization to maintain effective business operational cost control. It is true that several organizations try to reduce business operation cost in order to maintain high business profit maximization. Cost effective technological applications and solutions will help the organization to provide each and every detailed solution to all the problems in low operational cost. The organization should implement developed and modern version and codes of Oracles in the customer relationship management process in each and every branch to increase its brand value around the globe (Oracle, 2013, p.1). It is true that the competitors of Bank of America Merrill Lynch are trying to follow its e-CRM strategise. Therefore, it is highly required and essential for Bank of America Merrill Lynch to ensure effective customer relationship management. In addition to this, the organization should consider significance of effective modules of oracle so that the organization can bring more efficiency in business processes (Hamburg and Giering, 2001, p.38). References Adler, D., 2006. Daimler & Benz: The Complete History: The Birth and Evolution of the Mercedes-Benz. New York: HarperCollins. Ahlstrom, D., and Bruton, G., 2009. International Management: Strategy and Culture in the Emerging World: Strategy and Culture in the Emerging World. Stamford: Cengage Learning. Albaum, A., 2006, International Marketing and Export Management. London: Pearson Education India. Baker, M., Walker, O., Mullins, J., & Boyd, H., 1996. Marketing Strategy. Journal of International Business, 12(4), p.6. 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