This report critically evaluates Deutsche Banks’ (DB) international strategy and business environment, concentrating on DB’s universal bank strategy inside the European region. DB’s international business environment is analysed through the application of PEST Analysis and Porters 5 Forces frameworks. Analysis of DB’s international strategy includes evaluation of DB’s strategic positioning and orientation, entry strategy and finally measuring strategic performance. The latter is achieved by applying the Balance Scorecard Concept together with the features of SWOT Analysis, finally resulting in several recommendations for improvement of DB’s international operations. The applied business theories and concepts are critically examined in the course of their adoption.
The major finding of the report is that although the highly competitive industrial environment and global financial crisis, DB’s strategic management has: achieved good results in positioning DB as a leader in universal banking in Europe as well as around the world; low efficiency and low profitability relative to its main competitors; suffered high share value losses due to the financial crisis as well as its own failures in risk management, but remained stable and credible backed by its strong global franchise. Given that, DB has a strong potential to learn from the crisis, improve its former failures and come out stronger from this crisis.
Table of Contents
1. Introduction
1.1. Scope
1.2. DB Profile
2. Environmental analysis
2.1. PEST Analysis
2.1.1. Political and Legal factors
2.1.2. Economic factors
2.1.3. Social factors
2.1.4. Technological factors
2.2. Porter’s 5 Forces
2.2.1. Entrants
2.2.2. Industry rivalry and Substitutes
2.2.3. Suppliers’ and Customers’ Power
3. Strategy analysis
3.1. Strategic Positioning & Orientation
3.2. Entry strategy
4. Measuring Performance
4.1.1. Balance Scorecard Concept
5. Conclusion
Objectives and Research Focus
This report provides a critical evaluation of the Deutsche Bank Group's (DB) international strategy and business environment, specifically focusing on its universal banking model within the European region. The central research objective is to assess the bank's strategic positioning, market entry methods, and overall performance in a highly competitive and volatile financial climate, while identifying potential paths for future improvement.
- Analysis of DB's macroeconomic environment using PEST and Porter’s 5 Forces.
- Evaluation of DB’s global strategic orientation and market entry strategies (export, contractual, and investment modes).
- Application of the Balanced Scorecard (BSC) to measure qualitative and quantitative strategic performance.
- Assessment of the impact of the global financial crisis on DB’s operational stability and market standing.
- Formulation of recommendations to enhance future strategic development and efficiency.
Excerpt from the Book
3.2. Entry strategy
Originating in Germany, DB developed itself into a leading global player through its successful international growth strategy, which required decisions where and how to expand. “In fact, an important motive for internationalisation is to access the resources and capabilities available in other countries” (Grant, 2008:370). From the history of the bank it is known that it originally aimed to follow its business and private clients abroad (DB, 2009). Over the years, along with the growth of its product and service portfolio DB developed new business models, target groups, markets, locations and entry strategies.
According to Root (1987) there are three generic groups of entry methods: “export entry modes, contractual entry modes and investment entry modes” (in Mercado, 2001:342). Suitability of the entry modes corresponds closely to the firm’s profile, targets and strategic alternatives with regard to exploiting innovation (Grant, 2008:373). The following demonstrates how DB’s entry strategy relies on all three methods.
Summary of Chapters
1. Introduction: Outlines the research scope, the evolution of the global financial industry, and provides a foundational profile of Deutsche Bank.
2. Environmental analysis: Examines the external influences on the bank using the PEST and Porter’s 5 Forces frameworks to categorize macro and micro environmental threats and opportunities.
3. Strategy analysis: Evaluates DB’s competitive positioning, orientation, and specific methods used for international market entry.
4. Measuring Performance: Utilizes the Balanced Scorecard Concept to assess the bank's strategic success across financial, customer, internal, and growth perspectives.
5. Conclusion: Summarizes the key findings regarding DB's resilience during the financial crisis and its potential for future growth as a global universal bank.
Keywords
Deutsche Bank, International Strategy, Universal Banking, PEST Analysis, Porter's 5 Forces, Strategic Positioning, Market Entry, Balanced Scorecard, Financial Crisis, Risk Management, Corporate Strategy, Global Franchise, Shareholder Value, Competitive Advantage, Economic Performance.
Frequently Asked Questions
What is the primary focus of this report?
The report is a critical evaluation of Deutsche Bank's international business environment and its strategic management during a period of significant global financial turmoil.
What are the core thematic areas covered in the analysis?
The core themes include environmental scanning, the bank's strategic positioning, market entry methodologies, and performance measurement via the Balanced Scorecard.
What is the central research question?
The research seeks to determine how Deutsche Bank has positioned itself as a global leader in universal banking and how it can leverage its strengths to overcome the challenges posed by the recent financial crisis.
Which theoretical frameworks are used in this study?
The analysis employs the PEST framework for macro-environmental factors, Porter’s 5 Forces for competitive dynamics, and the Balanced Scorecard (BSC) for performance assessment.
What specific topics are discussed in the main body of the report?
The main body covers a PEST analysis, an evaluation of Porter's forces in the banking sector, a detailed look at DB's entry strategies, and an analysis of its performance metrics compared to industry competitors.
Which keywords define this work?
Key terms include Deutsche Bank, Universal Banking, Strategic Positioning, Market Entry, Balanced Scorecard, and Financial Performance.
How does the author classify the bank's strategic predisposition?
The author concludes that DB's strategic predisposition lies between geocentric and polycentric, as it balances global operational standards with the necessity for local adaptation.
What is the significance of the "Investment entry mode" for DB?
Acquisitions are identified as the most significant entry method for DB's expansion into new geographical markets and for gaining access to new skills and economies of scale.
Does the report view the financial crisis entirely negatively for the bank?
No, the author suggests that the crisis acts as an opportunity for the bank to identify internal weaknesses, learn from failures, and ultimately emerge as a more solid and independent institution.
- Quote paper
- BA (Hons) Artur Gleyberman (Author), 2009, Report on the International Strategy of Deutsche Bank Group, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/143385
