2013

BUSINESS STRATEGY MBA

[STRATEGIC MANAGEMENT & BUSINESS POLICY]

Thomas L. Wheelen J. David Hunger

INTRODUCTION

The focus of this exercise is strategy / executive-type matching in relation to a Saudi company and in the context of the Saudi economy. Matching managers to strategy is of importance to all organizations which want to be competitive and want to stay ahead in any industry or sector. It has been proved through research that firms which aligned the profiles of their top managers with the requirements of their strategies would outperform those that did not achieve such alignment. Matching managers to strategy is a significant component of superior performance. I have taken the SAMBA financial group to highlight the strategy-executive type alignment model.

The Saudi Economy

Nominal GDP (US$) - 2008 Income Level Per Capita Unemployment GDP growth Inflation

$468,800,000,000 High Income $17,870 5.6% 4.4% 9.9%

Despite the global recession in 2009, the Saudi economy has remained robust due to stable oil prices. The Kingdom of Saudi Arabia has been rated as the 13th most economically competitive country in the world, according to the International Finance Corporation (IFC)-World Bank annual "Doing Business" report issued for 2010. The report highlighted the rapid rate of economic growth among Middle Eastern countries, specifically Saudi Arabia, as a result of economic sector reform. Saudi Arabia was ranked as the best place to do business in the entire Middle East and the Arab World. In light of the above, Saudi economy promises to be competitive and is poised to grow further.

The Banking Sector

Over the last few years there have been significant changes in the financial/banking sector in Saudi Arabia - for example the introduction of new products/services and distribution channels, more banks offering Islamic Banking services, and the opening up of the banking and insurance sector to foreign investors. Customers are therefore faced with an increasing choice of products/services and are becoming more demanding as they see banks competing to offer a higher level of service. If banks do not have good mechanisms for understanding customer needs, targeting customers with a segmented approach (the one size fits all principle will not work any longer), and offering superior service they are likely to face decreasing customer loyalties resulting in increasing cost of customer acquisition and retention.

SAMBA FINANCIAL GROUP

Samba Financial Group was formed on Feb.12th 1980, to take over the then existing branches of Citibank, N.A. in Jeddah and Riyadh, which were opened in 1955 and 1966 respectively. Samba was formed in accordance with a program adopted by the Kingdom in the mid-1970s, under which all foreign banks were required to sell majority equity interests to Saudi nationals. SAMBA STRATEGY

Samba is a leading financial services group in the Kingdom of Saudi Arabia, providing world class service to meet the financial needs of its consumer, corporate and institutional customers. Samba achieves this through providing world-class advice, products and customer service, investing in its staff, contributing to its communities and delivering superior returns to its investors. It is part of Samba's strategy to achieve geographical diversification to expand the business and enhance shareholder returns. Samba continues to expand its business into other markets in the GCC and Asia, focusing on the excellence of its products and services. Samba considers mergers and acquisitions as one of the means of expanding its operations and footprint. Acquisitions have helped Samba to increase its reach, fine tune service delivery and achieve synergies across client segments.

SAMBA PEOPLE

Samba's team of more than 3,000 people is the cornerstone of its success as they continue to deliver unrivalled excellence in service, innovation and quality to our customers. Samba has a clear statement of philosophy on how people should be treated and supported. Samba Vision, Samba Core Values and SambaWay are more than words could say. They mainly drive our overall objectives, develop our employees and help deal with both our colleagues and customers in a meticulous way.

RECRUIRTMENT RECOMMENDATION FOR SAMBA

Child, (1974) and Norburn and Birley (1988) have examined the top executive-performance relationship in their research and have concluded that the alignment between top executives and strategy is an important contributor to superior financial performance. The field of strategic leadership (Hambrick 1989) suggests that top managers play a significant role in directing their organizations toward the achievement of competitive advantage. Since managers are responsible for articulating and/or implementing an organizations response to environmental conditions and demands, the alignment between managerial preferences, biases, and skills and organizational resources and competencies is significant to success. To be strategically opportunistic in the financial sector requires a disciplined and future-oriented look at where a business is and where it is leading to ensure that the right people with the right perspectives and competencies are in place in key leadership positions. In a complex and turbulent environment, strategy and structure follow people. The search for executive talent should focus on finding and developing executives who bring the appropriate perspectives and competencies to SAMBA. The mapping of executive perspectives and competencies is required in order to provide a framework for identifying the breath of the talent pool (i.e., inside or outside the organization, outside the industry, outside the country). Candidates should then be assessed against the specific perspectives and competencies that are synchronized with the future needs of the business. The top level executive for SAMBA should possess the right perspective with good knowledge of the financial industry and with a global outlook and mindset.

REFRENCES

Child, J., 1972, Organization structure, environments and performance: the role of strategic choice, Sociology, 6, 1, January, 122. Norburn, D. and S. Birley, 1988, The top management team and corporate performance, Strategic Management Journal, 9, 3, May-June, 225238. Hambrick, D.C., 1988, Preface, in: D.C. Hambrick, ed., The Executive Effect: Concepts and Methods for Studying Top Managers (Greenwich, Conn., JAI Press). Finance, Ministry of. Stats. Jan 2010. May 2010 <http://www.mof.gov.sa/en/docs/stats/index.htm>. INFO, AME. Banking in Saudi Arabia. June 2009. May 2010 <http://www.ameinfo.com/42242.html>. SAMBA. SAMBA PROFILE. Oct 2009. May 2010 <http://www.samba.com>.