Importance and Background of Lloyds Bank in the Market of the UK - Case Study Example

? Contemporary issues in business Table of Contents Introduction 4 Brief background of Lloyd's bank 4 2. Discussion 5 2.0 Drivers of Change (PESTLE) 5 2.1 Political- 5 2.2 Economic- 5 2.3 Social- 6 2.4Technological- 6 2.5 Legal- 6 2.6 Environmental 7 3.0 Ways to mitigate the negative forces of changes 7 Introduction of the contemporary issue 7 Unethical Use of Labour in Lloyd's bank 8 Impact of Unethical labor issue over Lloyd's bank 9 Ways of Mitigation 10 3.1 Effective rules and regulations of the organizations 10 3.2 Recruitment of an effective leader or manager 11 3.3 Proper wages to the employees 11 3.4 Proper recruitment policies 11 3.5 Proper relationship among the employees and management 12 3.6 Presenting proper posts to the employees 12 Conclusion 12 References 13 1. Introduction Brief background of Lloyd's bank Lloyd's bank is recognized as one of the most reputed retail banks, operating successfully in the market of England and Wales, since 1765. Being headquartered in United Kingdom, it serves the customers in the market of United Kingdom efficiently. As a result of which, the brand image and profitability of the financial organization of Lloyd's bank enhanced with a significant extent thereby amplifying its popularity. Along with this, due to the presence of varied types of products such as insurance schemes, deposit schemes and many others, its range of customers and brand value enhanced thereby amplifying its popularity and reputation in the market of United Kingdom among many other rival players. And so, the demand and total revenue of the financial organization of Lloyd's bank enhanced by ?19,673 million resulting in reduction of the threat of new entrants. Apart from this, due to the presence of value-added services, it expanded in more than 30 countries, from Argentina to United States of America, comprising of approximately 16 million employees. This acted as the prime cause that helped the organization of Lloyd's bank to amplify its profitability by ?2,803 million and market size by 6% in the market of United Kingdom among others (Lloyds Bank, 2013). Therefore, in-spite of tough competition and stiff economic downturn, the organization of Lloyd's bank maintained its sustainability in the market of United Kingdom among many other rival players. This essay is mainly divided into five parts highlighting the importance and background of Lloyd’s bank in the market of United Kingdom. Along with this, it also discusses the impacts of contemporary issues over the image and popularity of the organization of Lloyd's bank. Moreover, it also discusses the negative effects of the contemporary issue of unethical use of labor or staffs within the financial organization of Lloyd are thereby enhancing the rate of switchover costs. 2. Discussion 2.0 Drivers of Change (PESTLE) In order to analyze the external environment, competitors and market opportunities of Lloyd’s bank, the most popular analytical tool named PESTLE is used. 2.1 Political- As, the political scenario within the regions of United Kingdom, Europe and America is extremely stable, so it proved quite beneficial for the organization of Lloyd’s bank among others rival players. As a result of which, the profitability and brand value of the organization of Lloyd’s bank enhanced thereby amplifying its range of customers. It is extremely essential for any organization to retain its portfolio in the market, in-spite of numerous existing contenders ( Xu, 2005, pp. 478-536). 2.2 Economic- Global inflation acted as a curse for the organization of Lloyd’s bank thereby reducing its effectiveness to a significant extent. This is mainly because; inflation enhanced the level of unemployment and poverty thereby reducing the preference for depositing huge-amount of revenues within the financial institutions. Along with this, the consumer price index (CPI) also reduced by 3.5% that proved extremely worse for the country of United Kingdom. As a result of which, the living standard and life style of the citizens of United Kingdom reduced thereby amplifying the rate of redundancy and poverty. And so the economic condition of the citizens of the country of United Kingdom declined thereby hindering their prosperity to a significant extent among many other neighbouring regions. This acted negative over the efficiency of the financial organization of Lloyd’s thereby declining its market share and brand value to a certain extent. 2.3 Social- As inflation effected very effectively, so the financial organizations refused to offer any sort of interests or loans to the citizens. As a result, the living conditions and life style of the citizens declined to a significant extent thereby declining its economic status as compared to many other neighbouring countries. This is mainly due to the impacts of great inflation that declined the prosperity of the organization as well as the country of United Kingdom as well. Thus, it might be depicted that inflation offered varied types of negative impacts as mentioned above, to the citizens of United Kingdom (Lloyds Bank, 2013). 2.4Technological- Technological advancements proved extremely effective for the organization of Lloyd’s bank that amplified the brand image and market share to a significant extent. Introduction of ATM, varied types of software’s, credit cards, debit cards and many others enhanced the portfolio and profitability of the organization of Lloyd’s bank among other rival players. Apart from this, implementation of varied types of advanced technologies, the range of customers also enhanced to a significant extent that proved extremely effective for the organization in long run. And as a result of which, the brand identity and market size of the organization of Lloyd’s bank enhanced thereby amplifying its productivity to a certain extent. 2.5 Legal- Due to the introduction of varied types of favourable laws and rules, the image and reputation of the financial organization of Lloyd bank enhanced. As a result of which, it became capable in offering varied types of loans and interests to the citizens of United Kingdom as compared to other neighbouring nations. Apart from this, it also helped the organization of Lloyd bank to attain a huge range of customers thereby amplifying its profit margin and reputation in the market of United Kingdom among many other rival players. So, the introduction of the laws and regulation helped the banking institutions of United Kingdom to a certain extent. 2.6 Environmental Although the banking institutions of the nation of United Kingdom desired to offer varied types of loan facilities to the citizens with very low interest rates, still it failed to do so. It is mainly due to the economic slump-down that effective the financial institutions with a significant extent thereby hindering the rate of insurances or interests. As a result, the demand and preference of the customers over these brands declined thereby hindering the brand value and market share to a significant extent as compared to many other rival players. Therefore, it might be stated that inflation proved extremely worse for the organization of Lloyd’s bank thereby declining its prosperity in the entire market among many others. Hence, the above mentioned points clearly depict the external position of the market of United Kingdom for the financial institutions. 3.0 Ways to mitigate the negative forces of changes Introduction of the contemporary issue In this age of technological advancement, the intensity of contemporary issues enhanced with significant leaps and bounds. This is mainly due to the presence of huge number of labours or unemployed staffs in the entire globe, more-than the facilities or vacancies of the jobs allotted by the organizations. As a result of which, the organizational managements might very easily humiliate the staffs and labours thereby depriving them from varied types of basic requirements and demands. And so, these unemployed staffs or labours may not enhance their living standard and lifestyle that amplifies the rate of poverty and redundancy (Xu, 2005, pp. 323-356). As a result, the economic condition of these unemployed staff decline day by day that fades the financial status of the country among many other neighbouring countries. And this is the reason for which a contemporary issue is described as a problem that entirely relates with the present day scenario of an organization or society or locality. Unethical Use of Labour in Lloyd's bank In order to cope up with the situation of economic slump-down and extreme rivalry, the organization of Lloyd's bank decided to retain its portfolio by using its assets in a worse way. This means, the management of the organization of Lloyd's bank terminated or lowered the wage structure of numerous skilled and experienced staffs thereby declining its prosperity in the entire market of Britain. Along with this, due to such types of unethical behaviors, the brand image and reputation of the organization also reduced that hindered its path of success. And the level of reliability and loyalty of the customers over the organization of Lloyd's bank also reduced that declined its profitability and total revenue as well (Wiid & Diggines, 2010, pp. 390-452). Other than this, the management of the organization of Lloyd's bank used the traditional employees for seasonal purposes that amplified the ratio of attrition as compared to other organizations. And as a result of which the level of experienced and talented staffs reduced thereby declining its position in the market. And the range of customers might also get reduced thereby declining the total amount of deposits by a significant extent. On the other hand, the competitor bank might gain advantage from such types of issue thereby amplifying its customer base and profitability. Apart from this, the reputation and brand value of the competitor bank might get enhanced thereby improving its portfolio in the market among others. Moreover, as the organization of Lloyd's bank also failed to offer varied types of fridge benefits such as bonuses, incentives to the traditional employees, its reputation reduced day by day. As a result of which, the level of dedication and devotion of the employees reduced significantly thereby declining their level of performance and productivity. Not only this, the level of motivation and satisfaction of the employees also reduced that hindered their inner morale and confidence power. Along with this, maximum extent of the talented employees desired to swift-over to other banks so as to fulfill their inner desires and wishes. This acted negatively over the brand value and popularity of the organization of Lloyd's bank thereby hindering its identity among many other existing rival players. Not only this, the portfolio of the organization of Lloyd's bank also reduced that hampered its entire status and ranking in the market. Not only this, the organization of Lloyd's bank also offered huge amount of revenues as sub-prime mortgage to numerous individual to purchase residences. However, the bank reduced the actual salary of the staffs and accumulated such huge cash for the mortgage owners. As a result of which, the financial organization of Lloyd's bank became almost bankrupt thereby creating chaotic situation in the market of Britain. As a result of which, the brand image and loyalty of the organization of Lloyd's bank reduced thereby hindering its customer base to a certain extent. And such a situation hindered the entire reputation and popularity of the organization in the market among other rival players (Porter, 2008, pp. 543-567). Therefore, it might be clearly stated that, such type of contemporary issues not only hinders the brand image but the entire efficiency of the organization among other rival players. And so, such type of issues needs to be handled significantly by the human resource manager of the organization of the Lloyd's bank. Only then, the organization of Lloyd's bank might retain its portfolio and reputation thereby amplifying its range of customers to a significant extent. Impact of Unethical labor issue over Lloyd's bank In this age of globalization and industrialization, the organization of Lloyd's bank failed to maintain its loyalty and dependency within the minds of its target customers. This is mainly due to the unethical use of labors within the organization of Lloyd's bank. As a result of which the entire popularity and reputation of the organization declined thereby hindering its effectiveness as well (Gupta, 2004, pp. 453-478). And the profit margin and total revenue also declined that hampered the growth of the organization of Lloyd's bank to a significant extent. Apart from this, the skilled and experienced staffs also resigned the organization and joined its competitor brand in order to fulfill their inner desires and requirements. As a result, the brand image declined thereby hindering the total prosperity of the organization of Lloyd's bank as well. Thus, it might be depicted that, the intensity of contemporary issues enhanced to a significant extent thereby declining the image and prosperity of the financial organizations like Lloyd's bank. Ways of Mitigation 3.1 Effective rules and regulations of the organizations In order to reduce the impact of unethical use of labors, the organizational management might try to implement varied types of rules and regulations. Implementation of such rules might prove effective for the employees to attain all its primary and secondary needs thereby amplifying their living standard and economic condition. Along with this, introduction of such laws might help the organization in enhancing the retention rate of the employees thereby reducing their attrition ratio. This is extremely beneficial for the organization thereby amplifying its brand image and portfolio in the market of United Kingdom among many rival players. Along with this, retention of the experienced staffs might also help the organization in implementing varied types of innovative ideas and strategies within the organization that might enhance its prosperity in long run. And so, retention of these employees is extremely essential for an organization, operating in financial segment (Kolb, 2008, pp. 456-489). 3.2 Recruitment of an effective leader or manager In order to reduce the unethical practices over the staffs or labors of the organization, recruitment of an experienced leader or manger is extremely essential. This is because; recruiting such an experienced and talented leader might offer varied types of advice or suggestions so as to reduce the unethical practices. And as a result of which, the relationship among the employees or the management might get enhanced thereby amplifying the brand image and reputation of the organization of Lloyd's bank in the market of United Kingdom. Apart from this, due to better relationships, the employees might help to introduce varied types of innovative products or services thereby amplifying its demand among others. So, good relationship among the employees and the management of an organization is extremely essential (Tidd & Bessant, 2005, pp. 213-256). 3.3 Proper wages to the employees In order to reduce the rate of attrition, the management might desire to offer appropriate amount of wages to the employees. Along with this, the employees might also be offered extra amount of wages for extra work. This might enhance the satisfaction and morality of the employees thereby reducing the rate of attrition to a significant extent. Implementation of such type of strategies might prove effective in reducing the impacts of unethical practices (Grant, 2005, pp.378- 390). 3.4 Proper recruitment policies Implementation of effective recruitment policies might prove helpful for the organization in employing highly experienced and talented staffs, as per their knowledge and skills. Then, the organization may not force the employees to perform other jobs, irrespective his or her skills. And as a result, the organization had to offer the individual, appropriate wages that may enhance their satisfaction and inner morale. Only then the unethical practices such as lower wage structure might be reduced significantly (ESOMAR, 2008, pp. 367-432). 3.5 Proper relationship among the employees and management In order to reduce unethical practices from the organization, it is extremely essential to maintain proper relation among the employees and the management. As a result, the employees might assist the management by presenting varied types of ideas and information thereby amplifying its brand image and demand on the market of United Kingdom among other rival players (Porter, 1986, pp. 563-589). 3.6 Presenting proper posts to the employees All the employees of the organization might be offered posts, as per their experiences and skills. Only then, the retention rate of the employees might get enhanced thereby declining the attrition ratio. Along with this, the brand image and reputation of the organization might also get enhanced that may prove extremely effective for the organization. Therefore, it might be stated that implementation of all the above mentioned strategies might prove effective in reducing all sorts of unethical practices from the organization (Bradley, 2007, pp. 234-345). Conclusion Conclusively, it might be stated that, unethical or complementary practices might be reduced only by implementing ethical policies and practices within the organization. Implementation of such practices might prove extremely effective for the organization thereby amplifying the brand image and reputation in the market among many other rival players. So, such types of policies are highly preferred by the organizational managements in recent era. References Bradley, N. 2007. Marketing Research: Tools & Techniques. New York: McGraw-Hill. ESOMAR. 2008. Market Research Handbook. London: Sage. Gupta, S, L. 2004. Marketing Research. New York: McGraw-Hill. Grant, R, M. 2005.“Contemporary Strategy Analysis”. London: Sage. Kolb, B. 2008. Marketing Research: A Practical Approach. London: Sage Lloyds Bank, 2013. Personal Banking. [Online] Available at: http://www.lloydsbank.com/ Accessed on 31st December, 2013. Porter, M., E. 2008. Competitive Strategy: Techniques for Analyzing Industries and Competitors. New York: Springer. Porter, M, E. 1986. Competition in Global Industries. New York: Springer Tidd, J. & Bessant , J. 2005. “Managing Innovation: Integrating Technological, Market and Organizational Change” . Germany: JohnWiley & Sons. Wiid, J. & Diggines, C. 2010. Marketing Research. London: McFarland. Xu, J. 2005. Market Research Handbook: Measurement, Approach and Practice. New York: Springer. Read More