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Citibanks E-Business Strategy for Global Corporate Banking

Syndicate 4 : Rachmi Rida Utami (29111305) - Yunus Arie Wiratama (29111322) - Joseph Enrico Hadi (29111349) - Pramadona (29111364) - Rieke Fitri Yuniar (29111310) Ima Fatima (35012009)

E-Business Strategy for Global Corporate banking


Faced challenges in serving corporate customers with diverse

needs.
E-business strategy was (connect, transform, and extend) To web-enable its core services, develop integrated solutions,

and reach new market


Aimed to build a single web enable platform for all customers

with similar needs.

Problem
How could citibank build a flexible and agile e-business product

that could capture its client?


There were different needs of customers MNCs required custom-built hot-to-host product interface SMEs were more conservative and not ready for web-based

solutions
How could Citibank integrate the Internet into its strategy and

create competitive advantage?


Intense competition and dot com boom force Citibank and its

competitors transform their business

The Business - core product


Transaction services

Core Products
Treasury market services Corporate finance services

External Environment
General Environment Segment Political / Legal Description Regulators scrutinized third-party arrangements, to ensure the banks operation were not hijacked for fraudulent purposes The clients became e-enabled Tendency for customers to collect payments online and access to more Web-enabled financial processes Subprime Mortgages

Technological

Economical

Industrial Environment
Indicators Threat of New Entrant Bargaining of Suppliers Bargaining power of buyers Description Low Having difficulties in investment all at once High Requirement in critical technology High Same technologies already applied in other companies, the people knowledge in technology had already increasing Low Intensifies when the company want to improve market competition

Threat of Substitute Product Rivalry among Competing firms

Internal Environment
Resources Technology Experts Rare Valuable Costly to Imitate Nonsubstitutabl e

SWOT - Strength
Global Investment Network. Financial Industries Largest Proprietary Network. Innovative Products like Target Balancing and Notional Pooling. Emphasis/Compete on Customer Service rather than Price. Large Customer Base. State-of-the-Art Technology/Infrastructure. Use of Artificial Intelligence.

Strong Brand.
Global Reach and Local Intelligence. Build Customer Trust and Confidence For Lock in Outsourcing. Economies of Scale. Web Enabled Financial Processes. Paperless Transactions. Operational Efficiency and Cost Saving

SWOT - Weakness
Discretionary price Discrimination based on Client Volume & Value.
Operating Expenses Growth > Revenue Growth. Leadership Crisis is one of the most important weakness of the case. E-Business Expertise are necessary for the organization. Web Strategies easy to Imitation/duplicated. Varied Customer Practices Across Globe. Current Saturated Markets. More Instance Fraud. Online Reputation Management.

SWOT - Opportunities
Customer as Partner: BackOffice Operations.
E-Enabled Corporate and Middle Market. Multi-currency payment management and payment aggregation. Information flowing with the payment. B2B e-payment. Parallel convergence. Sarbanes-Oxley Corporate compliance. Emerging Markets.

SWOT - Threats
Changing global environment is one the important risk.
Declining interest margins Brokerage and life insurance Unacceptability Credit crunch due to subprime mortgage crisis Price war during slow down is also one of the major threat. Risk of increase in competition in market.

International Strategy
International Business-Level Strategy
Focused differentiation

International Corporate-Level Strategy


Transnational Strategy: global efficiency and local

responsiveness

Choice of International Entry Mode


Strategic Alliances - Using its partners strength: with companies that had complementary technology, infrastructure or access to markets - Key technology players: Oracle, Commerce One Inc., SAP AG, Wisdom Technologies, Bolero.net Acquisitions New Wholly Owned Subsidiary-

- In 2004, acquired - Greenfield approach Lava Trading (a leader - Citibank began in electronic invests directly in execution and sell another country or side order market (e.g., Penang) management systems

Conclusion
Differentiates from their competitors, and how to transform

traditional assets to digital assets


Technology changed customer expectations Integrating products in new ways Main goal is to provide the most cost effective , cutting edge,

reliable and secure solutions


Citibank see technology as their biggest comparative

advantage

Future trend
Many other bank can duplicate the same technologies
The needs of the customer are changing according to era Crisis in Europe Significant growth of SME

Suggestion
Focus to SME segment
Move to emerging market Educate SME segment customers Improve the vulnerabilities of the systems Implement Sarbanes-Oxley Corporate compliance. Cost efficiency (layoff employee, reduce data center) Integrated cost leadership / differentiation