Strategic Management Habib Bank Limited

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 Strategic Management Habib Bank Limited

|L e t t e r of Transmittal

Sir Shebaz Islam

Faculty Member, Strategic Management
Iqra University, Defence View
Karachi

Dear Mr. Islam:

We are submitting here our term report on the mission and vision of H abib
Bank Ltd. Initial pages of this report contains the brief information about
company’s background and the banking product it is offering.

All the information provided in the report is comprehensively discussed with

a satisfactory background of valid facts and figures .

If there are any questions or queries you have about the material presented
in this report, we will be extremely glad to appear before you.

Sincerely,

Zafar Ullah Khan – 9703

Uzair Ikhlaq – 9806

Uzair Siddiqui – 9620

Muhammad Arif – 5795

Hasan – 10231

Sifwat Usmani – 10741

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 Strategic Management Habib Bank Limited

|E x e c u t i v e Summary
The purpose of the following report was to conduct survey in Habib Bank Limited, for our
Strategic Management course, and understand the way it conducts its operation and the
strategic posture of the organization. The survey was conducted through conducting
interviews and questionnaires. Our key area to explore and research was “Vision and
Mission” of Habib Bank Limited.

HBL established operations in Pakistan in 1947 and moved its head office to Karachi. Our
first international branch was established in Colombo, Sri Lanka in 1951 and Habib Bank
Plaza was built in 1972 to commemorate the bank’s 25th Anniversary. HBL was the first
commercial bank to be established in Pakistan in 1947. Over the years, HBL has grown its
branch network and became the largest private sector bank with over 1,400 branches across
the country and a customer base exceeding five million relationships. With a presence in 25
countries, subsidiaries in Hong Kong and UK, affiliates in Nepal, Nigeria, Kenya and
Kyrgyzstan and representative offices in Iran and China, HBL is also the largest domestic
multinational.

In the following report, we have included the GAP that we found during our survey and
analysis of the organization along with some recommendations for further improvements for
the overall performance of Bank.

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 Strategic Management Habib Bank Limited

|T a b l e of Contents
1. HBL History ............................................................................................................... 5

2. Products....................................................................................................................... 6

3. Vision........................................................................................................................... 6

4. Mission ........................................................................................................................ 6

5. SWOT Analysis .......................................................................................................... 7

6. Question & Answer .................................................................................................... 8

7. Survey ........................................................................................................................ 10

8. Recomendations........................................................................................................ 11

9. Conclusion ................................................................................................................ 11

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 Strategic Management Habib Bank Limited

|H B L History
HBL established operations in Pakistan in 1947 and moved its head office to Karachi. Our
first international branch was established in Colombo, Sri Lanka in 1951 and Habib Bank
Plaza was built in 1972 to commemorate the bank’s 25th Anniversary.
HBL was the first commercial bank to be established in Pakistan in 1947. Over the years, HBL
has grown its branch network and became the largest private sector bank with over 1,400
branches across the country and a customer base exceeding five million relationships.
With a presence in 25 countries, subsidiaries in Hong Kong and UK, affiliates in Nepal,
Nigeria, Kenya and Kyrgyzstan and representative offices in Iran and China, HBL is also the
largest domestic multinational.
The Bank is expanding its presence in principal international markets including UK, UAE,
South and Central Asia, Africa and the Far East. Key areas of operations encompass product
offerings and services in Retail Banking. HBL has the largest Corporate Banking portfolio in
Pakistan with an active Investment Banking arm. SME and Agriculture lending programs and
banking services are offered in urban and rural centers. In UK and GCC, HBL focuses on trade
finance and remittances for South Asian Diaspora in addition to basic banking facilities.
With a domestic market share of over 40%, HBL was nationalized in 1974 and it continued to
dominate the commercial banking sector with a major market share in inward foreign
remittances (55%) and loans to small industries, traders and farmers. International
operations were expanded to include the USA, Singapore, Oman, Belgium, Seychelles and
Maldives and the Netherlands.
On December 29, 2003 Pakistan's Privatization Commission announced that the
Government of Pakistan had formally granted the Aga Khan Fund for Economic
Development (AKFED) rights to 51% of the shareholding in HBL, against an investment of
PKR 22.409 billion (USD 389 million). On February 26, 2004, management control was
handed over to AKFED. The Board of Directors was reconstituted to have four AKFED
nominees, including the Chairman and the President/CEO and three Government of
Pakistan nominees.

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 Strategic Management Habib Bank Limited

HBL has always been a bank and a brand for the masses, with a history that is inextricably
linked with the history of Pakistan itself. As it continues to grow, both locally and abroad, it
strives to embody its brand personality: honest, approachable, and inclusive. HBL is
currently rated AA+ (Long term) and A1+ (Short term) by JCR-VIS.

|Products
Business Customers Individual Customers
Corporate Banking Freedom Account
Commercial Banking Credit Cards
Global Treasury Deposit Accounts
Investment Banking Banc assurance
Islamic Banking Debit Card
Cash Management Mutual Funds

|Vision
Enabling people to advance with
confidence and success.

|Mission
To make our customer prosper, our staff excel and
to create value for our stakeholders

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 Strategic Management
|SWOT Analysis
STRENGTHS
Goodwill & historical background
Professional and well trained staff
Largest customer base
HBL is Pakistan's largest commercial bank
Wide Branch Network
20% share of HBL in financial market
Large Balance sheet size
Decentralized authority
THREATS
Adverse & unstable government policies
Political instability
Advance technology
Competition from other banks
Habib Bank Limited
WEAKNESSES
Unfavorable union activities
Unfavorable management conflicts
Checking System is at intra-department level
Weak marketing policies
Nepotism & Favorism
Infected portfolio still exists as bad debts
Centralized management in particular areas
OPPORTUNITIES
Growth in cash management
Expansion in cash management
Faster market growth represents opportunity
to grow and diversify
Restoration of investor’s confidence and pick
up in private sector investment flows.
Large deposit base and funds flow can help to
avail related market opportunities
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 Strategic Management Habib Bank Limited

|Question & Answer Session

with Rafi Ahmed – Deputy General Manager HBL

1. How do you know you have achieved your objective as stated in your Vision Statement?

Existence of the bank throughout country makes customer satisfy that they are connected
with the trust worthy bank and has its brand image, whenever customers face any sort
problem or query so they can provide their feedback at our call center or online they can
login their complains and through blogging as well. And other than that through
performance of the bank, achievements of targets and day by day increase in customer base
make as believe that yes we are achieving our objective as stated in our vision statement.

2. How do you communicate the objective of your Vision Statement to your employees?

HBL has its own institute at its head office by the name of management development
institute where they conduct the training session for their employees. We generally invite
external speakers to come and gave our employees the brief session about the importance
of vision and mission statement and how to achieve those objectives that are stated in our
statements. Other than that our experienced and senior employees also in lights the vision
and mission importance to their teams or departments, and bank also gets feedback from
their employees to understand either their employees understand the objective of vision
statement or not, if not, they prefer those employees for the respective training.

3. We can understand the superior value to customer and employees, but how HBL grant
superior value to their stake holders?

As HBL is a public limited company so shareholders also comes under stake holder and govt.
of Pakistan also has influence on it. And we are not only customer focus, we show same
respect same value to our stake holders.

Whenever bank increase its profitability or achieve its targets so it would ultimately benefit
our stake holders.

As I am associated with the bank from a very long period of time I can confidently say that
our stake holders are more than satisfied with the bank. And the reason behind their
satisfaction is obviously bank is providing some sort of value or importance to them.

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 Strategic Management Habib Bank Limited

4. For the achievement of goals stated in the mission statement, what are the align
strategies at HBL?

As you can see that the very first part of our mission is about the customers “to make our
customer prosper”. And obviously without customers we cannot survive. As the competition
is very tough in the market so to retain our customers from time to time we develop new
products for them and also facilitate them.

Well talking about the second part of our mission statement “to make our staff excel” for
our employees as I already discuss we conduct training sessions in which firstly we update
the product knowledge among them so if any customer comes to them, they can gave the
exact product information to customers.

And “value for the shareholder” for this thing the best return you give them this means you
are giving best value to them and it is dependent on the profitability and all the strategies
are for the profitability.

5. Do feel like there is a need for change in the banks mission statement?

We have a separate committee by the name of MMC (members of managing committee)

which consist executive management and board of directors. And one of their
responsibilities is work for mission and vision statement of the organization. HBL current
mission statement was made somewhere in 2005. HBL is now going for maximum
centralization, currently global transaction are centralized.

6. What was the need of revising the mission statement?

The changing environment and the changes in the mind set of customers and employees
highlight the need for the improvement in mission statement. And as you have noted that
our current mission statement is customer, employees and stake holder oriented. This is
one of the characteristics of a mission statement.

7. Does the national HBL network & internationally operating subsidiary branches share
same mission or is there a difference?

Nationally & internationally same mission & vision statement is followed. Because we give
same value to our entire customers, employees and shareholders. No matter if the culture is
different across the country.

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 Strategic Management Habib Bank Limited

|Survey

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 Strategic Management Habib Bank Limited

|Recommendation
 Their mission statement should reflect in what business they are in
 Their mission statement should reflect how they will achieve their goals
 Their mission statement should reflect that who their customers are
 Their mission statement should reflect their product offering
 Their mission statement should reflect where does the firm compete
 They are biggest bank their mission statements should include something about the society
development or social responsibility
 More Training about mission and vision should be given
 More training should be given to functional staff
 Advance employee training
 IT system improvement as per current & ongoing requirement
 More customer facilitation through net, ATM & call center

|Conclusion
Drucker says asking the question, “What is our business?” is synonymous with
asking the question, “What is our mission?”

An enduring statement of purpose that distinguishes one organization from other similar
enterprises, the mission statement is a declaration of an organization’s “reason for being.”
The Importance of Mission Statements is Well Documented Rarick and Vitton found that
firms with a formalized mission statement have twice the average return on shareholders’
equity than those firms without a formalized mission statement. Bart and Baetz found a
positive relationship between mission statements and organizational performance. Business
Week reports that firms using mission statement have a 30 percent higher return on
financial measures than those without such statements.

Habib Bank Limited is a big and strong organization with lot of strengths and few
weaknesses as mention above in the recommendation part which they should overcome for
the betterment of their promise and to achieve their goals.

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