Commonwealth Bank - Article Example

Part 1: Commonwealth bank The industry overview History Commonwealth bank has its main base in Australia; known as commonwealth bank of Australia (CBA). It was started in 1911 under the Act of Commonwealth Bank 1911 (CBA). It began its activities in 1912, bestowed with the responsibilities of general banking business and savings. Today it is the key leading and the largest bank providing services involving finances in the region. It has spread over the years with more than 52,000 employees and 800,000 shareholders. The service rendered include: share-broking services and products, investment, insurance, superannuation, funds management, institutional and business banking, premium and retail. Structure How the bank is structured is vital to enable customers’ growth and profits multiplication. The CBA takes pride in its strategic strengths on the structure which involves: the diversity in business mix, scale and brand. This is seen through the following segments: group corporate affairs, human resources, enterprise services, risk management, financial services, international financial services, wealth management, institutional markets and banking, private and business banking, and retail banking service. Such a structure aims to ensuring that commonwealth bank business not only achieves its profits but also encourages and supports employees. The vision The firm’s vision is particularly to excel in enhancing and securing the communities, businesses and people financial wellbeing. Growth strategy Following competition increase from both domestic as well as mononline specialist entry, the CBA had to revisit its processing system to address the prevailing limitations. For example its products on retail banking deposit transaction processing was being carried by a mainframe application of a large capacity. Some of these processing had not received any review since late 1960s upon their installation. To increase the IT complexity and improve the inflexibility of the core old system, over the years, supporting systems and satellites that continued to get outdated were incorporated (CBA). Therefore, the CBA had to address the issue on the existing system to ensure it rotates within the customer needs, with ease and simplicity in services, products and operations aimed at increasing profits of the firm. To achieve this upon its research team and analysis CBA had to come up with an efficient, scalable and flexible platform of IT that will raise its advantages in relation to its competitors on the ground. In order to build a lasting solution and safe time for its customers’ CBA spend five years working on a modern banking system; SAP program in 2008 (CBA SAP program) discusses. When it was ultimately completed the program helped the CBA achieve its objective by ensuring that its customers were able to access flexible product using a simple access real-time banking services 24 hours throughout the week a fact which ensured profitable growth and customer-centric. Major CBA objectives of reviewing the existing system The CBA laid the following top objectives: i. Come up with a structure that is customer centered, efficient and flexible based on improving value, service and 3600 customer view. ii. Do market research to ensure innovation and come up with wealthy product iii. Streamline the processes of the business as well as bringing down risks and failure of operation brought in place by the old systems Resolution The CBA implemented the SAP program that would play the role of: SAP Controlling and Finance Accelerator, SAP loans management and SAP Deposits management. CBA has experienced the advantages of investing on a modern program for core banking. This is because (CBA SAP program)use of SAP has enabled the organization to grow at a faster rate making it remain a head of its competitors for about 3years a fact which is likely to alter the landscape of banking in Australia. Business transformation The interaction of CBA with its customer has tremendously changed regarding services provided. Customers experience the transparency nature of transactions such as withdrawal, deposit, account balance checks, open, and closing of accounts instantly without waiting and wasting customer’s time and other resources. The employees have been laid greater burden of queries and rather concentrate on referrals as more online application take root ensuring fewer queries. In addition, the company can develop a product and maintain it in a simpler manner. Future plans Since innovation and implementation of the modern program 12million accounts have been moved to the new program and are currently accessing their banking system 24x7. Plans are ongoing to ensure all other accounts are transferred to the online system (CBA SAP program). (word 735) Part 2: Factors affecting online consumer’s decision making process Online marketing and shopping has grown tremendously in the 21st century (Hair, Walfinbarger, Ortinau, and Bush, 2008; p230). While many consumers benefit buying online some do not and so are the marketers. According to Frost, Goode and Hart (2010; p6) different factors influence the way the consumer makes decision to go for a product or service online. Some of these factors are personality type influences while others are internal factors which are naturally based on the individuals taste. Although these factors influence the consumer greatly, they are intangible and non-quantifiable. Such factors include but not limited to self-concept, attitude, motivation, perception learning among others. The marketer has to carry appropriate research to understand and examine how these factors impact on the consumer if he has to succeed selling online. The consumer might not be able to explain how these factors influence his consuming nature for example the motivation element leaving the burden on the marker to do research and help meet the consumer requirement. Perception This is the ability of the consumer to interpret, organize and select sensory stimulation to bring forth a clear understanding of the world. Perception means that, the consumer is able to sensibly decide on the received e-information. Selective attention The first step involved in perception is exposure (Hsieh and Chen, 2011; p235) which sends a stimulus subsequently leading to interpretation. Attention then follows exposure in this process. Although there are many stimuli passed to the consumer, the consumer decision is based on a small percentage of the communication which the consumer has exposure to. Some are disregarded because they bring no meaning to the consumer and others are defined by the traditions and religion of the consumer making them unnecessary. The consumer takes substantial amount of time and energy paying attention to stimuli that do not blend with their background. The stimuli movement, position, color and size also impact greatly on attention. Images that provide surprises as well as consumers need are not by passed by the consumer’s attention leading him to decide on whether to go for a particular product selling online. Selective distortion Consumers’ synthesizes the gathered data which they pay attention to. As they interpret the information, they put meanings to the stimuli. However, distortion of views, attitudes and information in consumer is inevitable. This occurs as consumer may tend to think otherwise; for example probably they never got the message clearly or discredit the source of information (Dou, Walden, Lee and Lee, 2012; 1555). Hence, any marker ought to present clear message and ensure the source is credible to reduce chances of distortions. Distortation is likely to arise as different people interpret the conveyed information in a different manner. For instances many online marketers have embarked on price reduction of a substance selling highly by different producers, this could not be interpreted as a quality product by the consumer as they may think the product is of low quality while another consumer may think of it as value for money. The marketer should therefore (Hair, Walfinbarger, Ortinau, and Bush, 2008; p233)., have an excellent framework to convey the information and ensure it is reinforced positively. For example use of cool colors speaks a great deal like green and blue is interpreted to mean security. Selective retention A consumer will only keep messages that favor his/her attitudes and beliefs. Selective retention aims at lowering cognitive dissonance. For example when a consumer reads review regarding a new car in the market, he will keep the positive information regarding the vehicle. Therefore, verbal adverts need to be done in such a manner that they ensure the consumer keeps the information. Perception relies upon the client’s situation and stimulus and therefore message can be perceived differently by different persons. Enhancing the stimulus quality is possible to ensure retention, attention and exposure probability is increased (Frost, Goode and Hart, 2010; p7) Hence online communication ought to be well designed to rid off distortion in perception. Learning Continuous information provision allows the customer to keep on internalizing the information. Retaining of the interpreted information within the consumers memory provides a substantial source in the process of making decision. Classical conditioning Classical conditioning is where the consumer uses the stimulus and response relationship to clearly understand and learn about the same response. Both the conditioned and unconditioned stimulus may keep on appearing. This is important as the sequence leads to removal of unconditioned stimulus. For example use of bright colors to advertise a soft drink may send a belief that it is tasty. Brand creation is important to the target audience. It helps the consumer generate the desired response(Hsieh and Chen, 2011; p237) . Use of music, images related to the country of origin, symbols and colors are linked to classical conditioning (words 794). References Close AG. And Kukar-Kinney, M 2010. Beyond buying: motivations behind consumers online shopping cart use. Journal of Business Research, 20: 188-209. Commonwealth Bank Australia (CBA): Company Overview retrieved https://www.commbank.com.au/about-us/who-we-are/our-company.html, 24/4/2014. Commonwealth Bank Australia SAP program. (CBA SAP) retrieved http://www.sap.com/bin/sapcom/en_us/downloadasset.2013-10-oct-07-16.commonwealth-bank-of-australia-pdf.html, 24/4/2014. Dou X., Walden JA., Lee S. and Lee JY. 2012. Does source matter? Examining source effects in online product reviews. Computers in Human Behaviors 28:1555-1563. Frost D., Goode S and Hart D. 2010. Individualist and collectivist factors affecting online repurchase intentions. Internet Research, 20:6-28. Hair JF., Walfinbarger MF. Ortinau DJ. And Bush RP. 2008. Essentials of Marketing Research, McGraw Hill; pp.230-245. Hsieh YC and Chen KH. 2011. How different information types effects viewers attention on internet advertising. Computer in Human Behavior, 27:935-945. Read More