STRATEGY ANALYSIS OF IDLCFINANCE LIMITED Course: W-615 Strategic Management Submission Date: June 12, 2014 Submitted to: Dr. A.K.M. Saiful Majid Professor IBA, University of Dhaka Submitted by: Muhammad Hasibur Rashid Chowdhury Student ID: ZR-1201002 EMBA, Batch No.: 12 Institute of Business Administration University of Dhaka 0 of 45 June 12, 2014 Professor Dr. A.K.M Saiful Majid Course Teacher Strategic Management (W-615) Institute of Business Administration University of Dhaka Subject: Letter of Transmittal Dear Sir, I’ve prepared the term paper titled “Strategy Analysis of IDLC Finance Limited” as per the valuable guidelines and advice provided by you. As an employee of IDLC I am bound to maintain confidentiality of different issues of the organization. Moreover, as a non-banking financial institute IDLC has to comply with immense rules and regulations which restrict the availability of data. Despite the facts I have tried to make the report extensive as much as possible. Preparing this paper helps me a lot to get exposure of strategic management issues with practical situation. I am personally thankful to you for giving me such an opportunity and also providing your thoughtful guidelines to prepare this report. For any additional information or assistance apart from this report if required so, please contact me at [email protected] or +8801730319914 Sincerely yours, __________________________________ Muhammad Hasibur Rashid Chowdhury Roll No: ZR-1201002 EMBA 12th Batch, IBA F 1 of 45 f ACKNOWLWDGEMENT This report is prepared as per the requirements of the Strategic Management (W-615) course under the Executive MBA program of IBA. To provide this opportunity and thoughtful guidelines I am grateful to the course teacher Professor Dr. A.K.M Saiful Majid sir. I would also like to thank some colleagues who have extended their cooperation to me for preparing this mammoth task. I would like to thank Mr. Mir Tariquzzaman, GM & CTO (IT) whom I have consultant several times on different issues. I would also like to thank Ms. Bilquis Jahan, DGM & Head of HR for her patience and time she had provided to me. 2 of 45 Table of Contents Executive Summary………………………………………………………………………………………………..………..i Chapter 1: Introduction..................................................................................................................... 10 1 Introduction................................................................................................................................ 10 1.1 Origin of the Report............................................................................................................. 10 1.2 Objective................................................................................................................................. 10 1.3 Scope...................................................................................................................................... 10 1.4 Methodology............................................................................................................................. 11 1.5 Limitations............................................................................................................................... 11 Chapter 2: Company Profile – IDLC Finance Limited............................................................................... 12 2.1 IDLC at a Glance....................................................................................................................... 12 2.2 Shareholding Structure................................................................................................................. 12 2.3 Organizational Hierarchy.............................................................................................................. 13 2.4 Products and Services.................................................................................................................. 14 2.4.1 For Large Local and Multinational Corporate Houses..................................................................... 14 2.4.2 For Small and Medium Enterprises............................................................................................ 14 2.4.3 For Retail Clients................................................................................................................. 15 2.4.4 For Capital Market Clients...................................................................................................... 15 2.5 Board of Directors...................................................................................................................... 15 2.6 Management Committee............................................................................................................... 16 2.7 Memberships............................................................................................................................. 17 2.8 Key Financials:.......................................................................................................................... 17 2.9 Geographic Coverage.................................................................................................................. 19 Chapter 3: Organizational Strategy Analysis – IDLC Finance Limited............................................................20 3.1 Critical Analysis of Strategy Making Hierarchy of IDLC.......................................................................20 3.2 Vision Statement........................................................................................................................ 21 3.2.1 Critical Analysis of IDLC’s Vision Statement............................................................................... 21 3.3 Mission Statement...................................................................................................................... 22 3.3.1 Critical Analysis of IDLC’s Mission Statement............................................................................. 22 3.4 Strategic Objectives.................................................................................................................... 23 3 of 45 3.5 Core values............................................................................................................................... 23 3. 6 Employee Code of Conduct and Ethics............................................................................................ 24 Chapter 4: Strategic Group Mapping..................................................................................................... 25 4.1 Strategic Group Mapping.............................................................................................................. 25 4.2 Analysis of Strategic Groups.......................................................................................................... 27 4.3 Basic and complementary strategies designed and being implemented to match market situations.....................32 4.3.1 Corporate Business............................................................................................................... 32 4.3.2 Small and Medium Business.................................................................................................... 33 4.3.3 Consumer Business................................................................................................................... 33 Chapter 5: Environmental Factors Analysis............................................................................................ 34 5.1 PESTEL Analysis....................................................................................................................... 34 5.1.1 POLITICAL FACTORS:........................................................................................................ 34 5.1.2 ECONOMIC FACTORS:....................................................................................................... 34 5.1.3 SOCIO-CULTURAL FACTORS:............................................................................................. 35 5.1.4 TECHNOLOGICAL FACTORS:.............................................................................................. 35 5.1.5 ENVIRONMENTAL FACTORS:............................................................................................. 36 5.1.6 LEGAL FACTORS:.............................................................................................................. 37 5.2 Five-Forces Model of Competition.................................................................................................. 37 5.2.1 Competition among Rival Companies........................................................................................ 39 5.2.2 Threats of New Entrants......................................................................................................... 40 5.2.3 Power of Suppliers............................................................................................................... 40 5.2.4 Bargaining Power of Client Groups........................................................................................... 40 5.2.5 Competitive Pressure from Substitute Products.............................................................................41 Chapter 6: SWOT Analysis................................................................................................................ 42 6.1 SWOT Analysis......................................................................................................................... 42 Chapter 7: Analysis on Overall Banking Industry..................................................................................... 43 7.1 Industry Life Cycle............................................................................................................... 43 7.1.1 Country’s Total credit growth – all banks.................................................................................... 43 7.1.2 Country’s Total Deposits Growth.............................................................................................. 44 7.1.3 Country’s Overall Export growth............................................................................................ 44 7.1.4 Country’s Import Scenario.................................................................................................... 45 7.1.5 GDP Sectoral Growth rate in %...................................................................................... 45 4 of 45 ..... 50 5 of 45 .................. 50 8... 48 7............................................................2 Dominant Traits of the Industry..................................................................................................1 Recommendations and Conclusion....... 46 7.4 Key Success Factors..............7............................................................................... 49 Chapter 8: Recommendations and Conclusion..............................................................3 Drivers of Industry Change.......................................................................................................................................................................... 6 of 45 . Established in 1985 as the pioneering leasing company in Bangladesh. strategy development & execution. These practices help IDLC attract and retain the best professionals in the industry. through its presence across the country with 26 branches and over 600 permanent employees. putting constructive pressure to achieve desired outcomes. providing opportunities to employees and fresh graduates for both their personal and professional development in the form of training programs. and overall organizational management in an efficient manner. Maintenance of an effective Corporate Governance process remains a key priority of the Board of IDLC. IDLC has always been well-regarded in the financial sector of Bangladesh for its corporate governance practices. ethical integrity and transparency. IDLC has developed a strong strategic management process that clearly dictates organizational policy-making. remaining updated on organizational and industry scenario.Executive Summary IDLC Finance Limited is one of the leading non-bank financial institutions in Bangladesh. ensuring health and safety standards across all branches of the IDLC Group while offering major benefit schemes and company contributions to employees. Consumer Finance. and portraying strong corporate governance. and helping employees maintain proper work-life balance throughout their stay at IDLC. succession planning and internship opportunities. to Capital Market solutions. IDLC has a strong Human Resource management system in place that focuses on key areas such as maintaining a favorable work environment by embracing diversity and inclusion. Both IDLC’s Board of Directors and top management personnel are integrally involved in leading this strategic management process in the most efficient manner by ensuring a good strategic plan for the organization. Based on the strategies adopted by its competitors and changing market scenario across different business segments. IDLC now offers a wide range of products ranging from Corporate Finance. job rotation. ethics and CSR. taking corrective measures for better strategic management. developing stronger competencies and capabilities. Over the year. SME Finance. Moreover. IDLC’s business units also differ from one another in terms of 7 of 45 . exercising non-discrimination and maintaining gender balance across all spheres of IDLC. strong management leading to efficient strategy development and execution. “The Five Forces Model of Competition” reveals strong market competition and rivalry in the industry. budgetary measures and various policies and regulatory measures by the Government and Bangladesh Bank. By focusing more on balanced strategic objectives. superior customer service. changing demographics of the population. “PESTEL” analysis reveals major political. high bargaining power of both industry suppliers and customers due to intense competition among rival companies and competing product offerings. The major factors of IDLC’s external. greater reliance on technology to offer more customized financial solutions and better services. strong technology platform. diversified product portfolio and a prestigious customer base.core strategies and focus areas. environmental and legal factors that influence IDLC’s performance and strategic decisions. In response to a more mature market. technological. higher ticket size. professional workforce combined with strong HR Management. we may safely conclude that IDLC holds a strong position in the banking and financial services sector of Bangladesh. revising business models and strategies in a timely manner will provide better results and competitive advantage. and growing CSR commitment. strong financials. have been identified through PESTEL analysis and Porter’s Five Forces Model of Competition. and their subsequent influence on its operations. and immediate industry and competitive environment. In light of the above analysis. while its SME business is more focused on rapid product innovation and increased presence through expanded geographic coverage to leverage the most from the fast-growing SME sector in Bangladesh. competent management team. and almost zero threat from substitute products from another industry. but are not limited to. thus leading to a strong brand image. economic. Major factors include. 8 of 45 . low threats of new entrants due to high regulatory restrictions. and improved portfolio quality. IDLC’s Corporate business is mainly focused on service quality and efficiency. SWOT Analysis of IDLC reveals its core strengths in the areas of effective strategic decision-making and execution. strong corporate governance. socio-cultural. 1. it’s strategic groups. PESTEL. a number of strategic management tools were applied. different external factors such as five forces. Those parameters are company’s current strategies. focusing on IDLC’s strategic objectives. polices and guidelines developed and executed by its Board and Management. our honorable teacher Professor Dr. banking industry life cycle. As per our teacher’s instruction we have made this report.3 Scope The report attempts to analyze the strategic management process of IDLC Finance Limited. dominant traits of the whole industry. and accordingly recommend required measures. what is the strategic group. their impact of the different environmental factors such as five forces. 1. PESTEL.2 Objective Our main objective is to analyze the strategy implemented by IDLC both basic and complementary. including detailed analysis of IDLC’s vision. PESTEL analysis and applying Porter’s Five Forces Model of Competition to highlight influence of major factors related to IDLC’s external 9 of 45 . 1. Saiful Majid has given us an assignment to perform an analysis on the strategic management process of my own company and recommend course of actions to strengthen in light of the learning from the course.Chapter 1: Introduction 1 Introduction In this report we will analyze the strategy of IDLC Finance Limited in terms of various parameters. mission and strategic objectives. and followed by its staff. We will also go through the detail analysis on SWOT of IDLC. SWOT.1 Origin of the Report As part of our Strategic Management course of Executive MBA program. key success factors and finally come up with recommendations so that IDLC Finance Limited can do even better in the competitive market. To identify IDLC’s competition market position and major opportunities for the future. strategic group mapping of IDLC. 5 Limitations Due to confidentiality and sensitivity of certain information. detailed strategies. 1. Accordingly recommendations have been provided in this report that may contribute to further growth and improvement of IDLC. 1. and SWOT Analysis of IDLC. SME.environment and immediate industry and competitive environment.4 Methodology The report has been prepared by reviewing various policies. policies and guidelines could not be enclosed with this report. Capital Markets and Human Resources were interviewed for their opinion on various issues related to IDLC’s strategic management process. Consumer. 10 of 45 . while key personnel from Corporate. guidelines and reports of IDLC. references have been made from IDLC’s Annual Financial Report and Annual Sustainability Report. Moreover. IDLC offers a wide range of loan and deposit products to its Corporate. Bangladesh’s pioneering leasing company. and over 600 permanent staff across the Group. The Group is also highly regarded for its professional pool of resources and progressive work environment 2.1 IDLC at a Glance IDLC Finance Limited. providing Brokerage services.Chapter 2: Company Profile – IDLC Finance Limited 2.2 Shareholding Structure 11 of 45 . Today. German Investment and Development Company (DEG). while operating in the Capital Markets through its two whollyowned subsidiaries – IDLC Investments Limited. The IDLC Group has always been a standard bearer for the financial sector in terms of corporate governance. IDLC was formed through the collaboration of International Finance Corporation (IFC). IDLC Finance is the leading multi-product Non-Banking Financial Institution in Bangladesh with 26 branches and 2 SME booths. The Aga Khan Fund for Economic Development. was established in Dhaka in 1985. IPDC of Bangladesh Limited and Sadharan Bima Corporation. and IDLC Securities Limited. The City Bank Limited. providing Merchant Banking services. Consumer and SME client segments. Korea Development Financing Corporation. statutory compliance and ethical business practices. Kookmin Bank. Sr. Mgt. Exec. Sr.3 Organizational Hierarchy CEO & Managing Director DMD DMD Asst.2. Asst. Prob. Manag Manag er er Manag Manag er er Asst. Officer Officer Senior Senior Officer Officer Officer Officer Suppo Suppo rtrt Officer Officer Junior Junior Officer Officer 12 of 45 . Manag Manag er er Sr. Exec. Officer Officer GM GM DGM DGM Managerial Hierarchy AGM AGM Sr. Traine Traine ee NonManagerial Hierarchy Execut Execut ive ive Officer Officer Prob. Manag Manag er er Mgt. Asst. 4 Products and Services IDLC has extensive knowledge.SME Sachal Loan Medium Enterprise Finance in the forms of: .Term Loan .Supplier Finance 13 of 45 .Specialized Products Other facilities include: .2 For Small and Medium Enterprises Small Enterprise Finance in the forms of: .Seasonal Loan .4.SME Loan . These are discussed in the following sections: 2.Revolving Short–term Loan .2.Abashan Loan . expertise and experience to offer a range of financial solutions in response to the needs of a broad spectrum of clientele.Working Capital Finance .1 For Large Local and Multinational Corporate Houses IDLC has many some products for the large local and multinational corporate houses such as: - Term Loan Lease Finance Working Capital Finance Project Finance Refinancing and Special Funds Corporate Advisory Services Structured Finance division offers the following Solutions: - Fund-raising through Loan/Lease/Private Placement of Equity/Preference Shares/Bond Foreign-currency Loan/Refinancing of Special Funds Project/Infrastructure Finance Advisory Services Securitization of Assets Structured Solutions 2.Lease Finance .Project Finance .4. ) Research Brokerage Services 2. Director-nominated by Transcom Group of Companies 4. Cap Invest . Rights Shares Offering. Mr. Director-nominated by The City Bank Limited 5. Mr.- Women Entrepreneur Loan Commercial Vehicle Loan 2.e. Bond Issuance. Mr.4 For Capital Market Clients - Portfolio Management (MAXCAP . Mr. Kazi Mahmood Sattar. Md. Mr. RPO. and one Executive Director.Discretionary Portfolio Management known as MAXCAP.4. Rubel Aziz. Chairman-nominated by Reliance Insurance Limited 2. Director-nominated by The City Bank Limited 6. Short-term Deposit) Home Loan Car Loan Personal Loan 2. the CEO and Managing Director of IDLC: 1. Hossain Mehmood. Anwarul Huq. Md. Aziz Al Kaiser. Kamrul Hassan. i. Director-nominated by Mercantile Bank Limited 14 of 45 .5 Board of Directors The Board of IDLC comprises of eleven Non-executive Directors. Director-nominated by Sadharan Bima Corporation (SBC) 9. Mrs. Double/Triple Money Deposit. Director-nominated by The City Bank Limited 8. Meherun Haque. Director-nominated by The City Bank Limited 7. Rezaul Karim. Alhaj Akram Hussain (Humayun). Monthly/Quarterly/Annual Earner Deposit. including two Independent Directors. Director-nominated by The City Bank Limited 3. Corporate Advisory etc.4. Mr.Margin Lending) Investment Banking (IPO. Mr.3 For Retail Clients - Deposit Schemes (Cumulative Term Deposit. Bangladesh Securities and Exchange Commission (BSEC). Deputy Managing Director Mr. Mr. Ziaul Hoque Khan. Mir Tariquzzaman. AGM and Head of Operations Mr. Mr. Managing Director. and stock exchanges. Jamal Uddin. other than the Independent Directors. Selim R. 2. and the elected Directors nominate two Independent Directors for the Board. Independent Director 12. DGM and Head of Consumer Division Ms. M. AGM and Head of Internal Control and Compliance Mr. Syed Abu Naser Bukhtear Ahmed. all scheduled banks and financial institutions.10. Ataur Rahman Chowdhury. Bilquis Jahan. and Mr. GM and Chief Technology Officer Mr. Md. Md. Mustaq Ahammed. Irteza A. The Directors are then appointed by the shareholders in the Annual General Meeting (AGM). Hussain. The CEO and Managing Director of IDLC is also appointed by the Board subject to consent of the shareholders in the AGM. DGM and Head of Human Resources Mr. Mr. Moniruzzaman. GM and Head of Credit and Collection Mr. Asif Saad Bin Shams. Hussain. Independent Director 11. Saifuddin. F. IDLC Securities Limited (subsidiary) 15 of 45 . are nominated by their respective organizations.6 Management Committee Mr. CEO and Managing Director Mr. Managing Director. H. Selim R. Farooq Sobhan. M. Any change in the Board members requires intimation to the Bangladesh Bank. Khan. Ex-Officio All Non-executive Directors.M.F. GM and Head of SME Division Mr. GM and Head of Corporate and Structured Finance Mr. IDLC Investments Limited (subsidiary). Zahid Ibne Hai. 7 Memberships Association Bangladesh Leasing and Finance Companies Association | Asian Financial Services Association | Bangladesh Merchant Bankers Association | Bangladesh Association of Publicly Listed Companies Institute The Institute of Bankers.8 Key Financials: 16 of 45 . Bangladesh Chambers of Commerce and Industry International Chamber of Commerce – Bangladesh | Metropolitan Chamber of Commerce and Industry | Dhaka Chamber of Commerce and Industry | Bangladesh German Chamber of Commerce and Industry | The Federation of Bangladesh Chambers of Commerce and Industry International Memberships International Factors Group (IFG) .2.a global initiative to improve access to financial services by small businesses Sustainability Memberships United Nations Global Compact | United Nations Environment Programme Finance Initiative | CSR Centre of Bangladesh 2.an international association of factoring companies | Small Business Banking Network (SBBN) . 17 of 45 . 9 Geographic Coverage 18 of 45 .2. namely Corporate. SME. IDLCIL and IDLCSL Developed by the Board of Directors. Consumer and Capital Market Operations Developed by the Head of different Business Lines.Chapter 3: Organizational Strategy Analysis – IDLC Finance Limited 3. while provide a basis for managing down-the-ladder activities 19 of 45 . in line with the organization’s overall Corporate Strategy Developed by the Functional Heads. and the CEO and Managing Director of IDLC Business Strategy Developed for each individual business activity of the company. in collaboration with key company personnel Operating Strategy Developed by Managers of major geographic units & strategically important activities. i. such as human resource management.1 Critical Analysis of Strategy Making Hierarchy of IDLC Corporate Strategy Across the IDLC Group. and its two subsidiaries.e. marketing & promotion etc.. in consultation with Functional Heads Functional Strategy Developing specific strategies and objectives for each individual functions under major Business areas. These strategies complete the execution and achievement of major Business and Functional strategies. IDLC Finance Limited. since it shows better returns in future. Easy to communicate: The vision statement is very easy to communicate. while holding the leading market position in the financial sector of Bangladesh.1 Critical Analysis of IDLC’s Vision Statement IDLC’s vision statement contains the following characteristics of a good vision statement: Graphic: The vision statement gives a clear indication that the management of IDLC is trying to develop a company that provides the best financial services. Feasible: The vision statement shows a position that IDLC can expect to achieve in the future.2 Vision Statement We will be the best financial brand in the country 3. In spite of the above characteristics. giving management to option to change their strategic course in response to evolving product. Also it does not indicate what the company is doing to prepare for the future. with carefully crafted strategies. to become the best financial brand in the country. market or technological situations. Desirable: The direction provided to the company by the vision statement is desirable to IDLC’s stakeholders’ in the long run. the vision statement also has some major shortcomings that should be addressed: Not too focused: The vision statement does not provide a specific tangible goal to the management to set their strategies and allocate resources accordingly. since it is brief. 20 of 45 . Flexible: The statement is flexible. precise and memorable.3.2. followed by proper and timely execution. Hence it can be safely presumed that IDLC’s vision is a moderately well-drafted statement. “Sustainable business practices”. Customer desire of “Superior customer experience”. superior customer experience and sustainable business practices Quality Growth Superior Customer Experience Sustainable Business Practices 3.3. it is a fairly effective mission statement. In that regard. and Core objective of IDLC’s existence and operation. 3. however. It could be applicable to any other rival company competing in the industry. Too reliant on superlatives: The vision statement only states that IDLC desires to be the “Best Financial Brand” in country. it does not indicate any specific strategic course of the company.3 Mission Statement We will focus on quality growth. It specifically mentions: Stakeholder desire of “Quality growth”. although there is room for much improvement. Not distinctive: The vision statement fails to create a unique identity for IDLC. that is. 21 of 45 .1 Critical Analysis of IDLC’s Mission Statement The mission statement of IDLC clearly specifies the areas the company will focus on to achieve its vision of becoming the best financial brand in the country. 4 Strategic Objectives The strategic objectives of a company serve as the performance targets. The strategic objectives for IDLC include: Grow and develop our talent pool. The core values of IDLC comprise of seven behavioral attributes expected from its employees: 22 of 45 . traits and behavioral norms its employees are expected to display in carrying out their daily responsibilities and pursuing the company’s strategic vision and strategies. that is. 3. Usually such objectives are set to ensure that the company at its full potential and delivers the best possible results to work towards achieving its vision.5 Core values The core values of IDLC portrays the beliefs. Grow and diversify funding sources. Aggressively grow SME portfolio.3. results and outcomes desirable by the company management. Fully leverage new core banking platform. Grow sales and service capabilities in Consumer Division. Optimize distribution points. Consolidate capital market operations and enhance capabilities. Focus on top-tier clients in Corporate. Maintain knowledge of and comply with all applicable laws. Act and encourage others to behave in a professional and ethical manner that will reflect positively on IDLC employees. people and others with whom they do business. their profession and on IDLC. Strive to maintain and improve the competence of all in the business. at large. prospects. agencies and public. rules and regulations. dignity and in an ethical manner when dealing with customers. Deliver professional services in accordance with IDLC policies and relevant technical and professional standards. Disclose all conflicts of interest. and 23 of 45 . competence. Use reasonable care and exercise independent professional judgment. colleagues. Respect the confidentiality and privacy of customers. Not restrain others from performing their professional obligations.Integrit y Simplici ty Passion Custom er Focus Core Values of IDLC Ecofriendly Trust & Respect Equal Opportu nity 3. 6 Employee Code of Conduct and Ethics IDLC employees shall: Act with integrity. following similar strategies.1 Strategic Group Mapping “Strategic Group Mapping” is a concept used in strategic management that groups companies within an industry that have similar business models or similar combinations of strategies. Strategic Group Mapping delivers the following benefits to an organization: It helps a company identify its direct and indirect competitors. within the industry. This also helps the organization identify its position. In consideration of the value chain components of the banking and financial sectors industry.Chapter 4: Strategic Group Mapping 4. in respect to its main competitors. It often helps identify future opportunities and/or strategic problems to the company. and/or possible partners within the industry. or competing on similar bases. Such grouping aims to identify organizations with similar strategic characteristics. It illustrates the ease or difficulty of moving from one strategic group to another. and It ensures the company takes into account views of its major stakeholders while developing or assessing its strategies. IDLC’s close competitors include a combination of the following banks and NBFIs: Organization Type BRAC Bank Limited Bank The City Bank Limited Bank Eastern Bank Limited Bank IPDC of Bangladesh Limited NBFI United Leasing Company Limited NBFI Uttara Finance and Investments Limited NBFI The relative positions of IDLC in terms of its key financials have been provided below: 24 of 45 . 393 3.044 5.784 2.365 1.817 384 229 3.17 37.142 815 2.00 130.63 7.48 147.403 713 1.90 Comparative position based on Total assets (in BDT Million) and NPL ratio: 25 of 45 .50 19.396 5.620 794 7.Bank/NBFI BRAC Bank Limited The City Bank Limited Eastern Bank Limited IDLC Finance Limited IPDC of Bangladesh Limited United Leasing Company Limited Uttara Finance and Investments Limited Total Assets Operating Profit Income after Tax NPL Ratio 180.406 700 10.115 208 129 3.314 4.731 2.98 11. 26 of 45 . For IDLC. Bogra. small and medium enterprises (excluding micro enterprises). and NRB clients.Comparison of Strategic issues (Products. Sylhet. IPDC of Bangladesh Limited (IPDC). coverage and market segments) Organizations Product and Service Diversity Geographic Coverage Market Segments Served IDLC Wide range of products offered under Corporate. SME and Capital Markets segments 26 branches and 2 sales centres across Dhaka. Caters to local and multinational corporate houses. The City Bank Limited (CBL). Chittagong. the following tables summarize the comparative position and strength of competition among IDLC. Consumer (Deposit and Loan products).4. and Pricing Policy In light of the above. capital market investors. United Leasing Company Limited (ULC) and Uttara Finance and Investments Limited (UFIL). Comilla and Jessore regions. the following characteristics were considered as the bases of competition with its immediate peer banks and NBFIs: Product and Service Diversity Geographic Coverage Market Segments Served Brand Image and investments in Marketing Communications Product and Service Quality. individual borrowers of Consumer loan products. Table 1 . individual deposit clients. BRAC Bank Limited (BRAC).2 Analysis of Strategic Groups The number of groups within an industry and their composition depends on the dimensions used to define the groups. Eastern Bank Limited (EBL). Rangpur and Barishal regions. Hence CBL is a direct competition for IDLC in terms of product offerings. Comilla.BRAC Bank Wide range of products offered under Corporate. Rajshahi. Sylhet. 27 of 45 . Hence EBL is in a much better competitive position compared to IDLC in terms of geographic coverage. and NRB clients. Much wider geographic coverage with over 100 branches across Dhaka. Consumer (Deposit and Loan products). small and medium enterprises. Chittagong. individual borrowers of Consumer loan products. Hence BRAC is in a much better competitive position compared to IDLC in terms of geographic coverage. Chittagong. Hence EBL is a direct competition for IDLC across these market segments. micro. micro. Jessore. Wide range of products offered under Corporate. Much wider geographic coverage with around 100 branches across Dhaka. Hence CBL is in a much better competitive position compared to IDLC in terms of geographic coverage. and NRB clients. Rangpur and Sylhet regions. individual borrowers of Consumer loan products. capital market investors. Sylhet. SME and Islamic Banking segments. Khulna. small and medium enterprises (excluding micro enterprises). Hence EBL is a direct competition for IDLC in terms of product offerings. Caters to local and multinational corporate houses. Khulna. Hence CBL is a direct competition for IDLC across these market segments. Rajshahi. Wide range of products offered under Corporate. Rangpur and Barishal regions. individual deposit clients. Rajshahi. and NRB clients. Caters to local and multinational corporate houses. individual borrowers of Consumer loan products. small and medium enterprises. individual deposit clients. Chittagong. Consumer (Deposit and Loan products) and SME Banking segments. SME and Investment Banking segments. Consumer (Deposit and Loan products). Much wider geographic coverage with over 70 branches across Dhaka. Hence BRAC is a direct competition for IDLC across these market segments. Caters to local and multinational corporate houses. Khulna. City Bank Eastern Bank Hence BRAC is a direct competition for IDLC in terms of product offerings. individual deposit clients. Caters to select clients segments such as local and multinational corporate houses. Hence IDLC is in a much stronger position compared to UFIL in terms of its geographic coverage. Barishal. Rajshahi. Caters to corporate houses. SME Finance (only Supplier Finance facilities). SME and Consumer (Deposit and Loan products) segments. Hence IDLC is in a much stronger position in terms of its product and service portfolio compared to ULC. Hence IDLC is in a much stronger position in terms of its product and service portfolio compared to UFIL. small and medium enterprises. Hence ULC has a geographic coverage comparable to that of IDLC. Rangpur and Sylhet regions. 17 branches across Dhaka. 5 branches located in Dhaka. and individual depositors and Consumer loan clients. Select products offered under Corporate. 5 branches across Dhaka. Chittagong and Bogra. 28 of 45 . Hence UFIL competes with IDLC only in these select market segments. Supplier Finance clients constituting of small and medium enterprises. Hence IDLC is in a much stronger position compared to IPDC in terms of its geographic coverage. Chittagong. and individual depositors and Consumer loan clients. Caters to select client segments such as Syndication and Lease clients constituting of large local and multinational corporate houses. Khulna. Hence IPDC competes with IDLC only in these select market segments. and Consumer (Deposit and Loan products) segments. Select products offered under Corporate Finance (only Syndication and lease facilities). and individual depositors and Consumer loan clients. Chittagong and Sylhet. Hence IDLC is in a much stronger position in terms of its product and service portfolio compared to IPDC. The competition is particularly strong in the Supplier Finance segment considering ULC’s strong service capability in offering this product. Hence ULC competes with IDLC only in these select market segments.IPDC ULC UFIL Select products offered under Corporate and Consumer (Deposit and Loan products) segments. though the budget is significantly low compared to banks. CBL is in a much better position compared to IDLC in terms of marketing communications activities. 29 of 45 . investment in marketing communications is gradually increasing. Strong brand image and extensive investment in marketing communications initiatives. Hence it is difficult for IDLC to compete with CBL in terms of its pricing policy. High product and service quality. service quality and pricing policy) Organizations Brand Image and investments in Marketing Communications Product and Service Quality Pricing Policy IDLC Strong brand image. Hence although IDLC has a strong brand. resulting is lower lending rates offered to clients. however. compared to NBFIs. Hence although IDLC has a strong brand. High product and service quality. Much lower cost of funds. High product and service quality ensured at all times Higher lending rates compared to banks. considering deposit base and bankborrowing as major source of funds BRAC Bank Strong brand image and extensive investment in marketing communications initiatives. BRAC is in a much better position compared to IDLC in terms of marketing communications activities. compared to NBFIs. resulting is lower lending rates offered to clients. City Bank Hence it is difficult for IDLC to compete with BRAC in terms of its pricing policy. Hence CBL is a direct competition for IDLC in this regard. compared to IDLC. Hence BRAC is a direct competition for IDLC in this regard. Much lower cost of funds.Table 2 – Comparison of Strategic issues (Brand image. compared to IDLC. Significantly low investment in terms of brand building and marketing communications activities. Hence IDLC competes directly with IPDC in terms of its pricing policy. Significantly low investment in terms of brand building and marketing communications activities. Hence IDLC is in a much better position compared to IPDC in terms of brand image and marketing communications. Much lower cost of funds. compared to NBFIs. Hence EBL is a direct competition for IDLC in this regard. compared to IDLC. Similar pricing policy is followed by all NBFIs. considering deposit and bank borrowings as major source of funds. Sufficiently strong product and service quality.Eastern Bank IPDC ULC Strong brand image and extensive investment in marketing communications initiatives. considering deposit and bank borrowings as major source of funds. resulting is lower lending rates offered to clients. Similar pricing policy is followed by all NBFIs. 30 of 45 . Hence IDLC is in a much better position compared to ULC in terms of brand image and marketing communications. Hence although IDLC has a strong brand. Hence ULC is a direct competition for IDLC in this regard. Sufficiently strong product and service quality. EBL is in a much better position compared to IDLC in terms of marketing communications activities. High product and service quality. Hence IPDC is a direct competition for IDLC in this regard. Hence it is difficult for IDLC to compete with EBL in terms of its pricing policy. compared to IDLC. Hence IDLC competes directly with IPDC in terms of its pricing policy. compared to IDLC. Increasing ticket size to existing customers.1 Corporate Business To remain competitive in corporate business. Hence IDLC is in a much better position compared to UFIL in terms of brand image and marketing communications. Hence IDLC competes directly with UFIL in terms of its pricing policy. and improving overall service quality and timeliness to attract more customers. by striving to lower funding costs to offer attractive rates. design flexible credit terms. 31 of 45 .3. IDLC’s specific strategic measures include: Improved efficiency across the value chain. Sufficiently strong product and service quality.UFIL Significantly low investment in terms of brand building and marketing communications activities. compared to IDLC. and ensure continuous flow of business in future. and accordingly strategies are crafted at organizational and functional levels to cope with the changing market situations. Booking leading Corporate houses to improve quality of the portfolio. Similar pricing policy is followed by all NBFIs. Developing new service capacities to offer better and unique financial solutions to clients.3 Basic and complementary strategies designed and being implemented to match market situations The market scenario of IDLC varies along with its business functions. 4. considering deposit and bank borrowings as major source of funds. Hence UFIL is a direct competition for IDLC in this regard. as well as relevant strategies adopted by its major competitors. 4. in terms of better planning. At present.. Booking high net-worth deposit customers to improve quality of the portfolio. and another branch in North Bengal. Restricting the size of the Corporate team by not hiring for any new positions and leveraging more from the existing ones. business and human resource management.2 Small and Medium Business IDLC’s SME Team is focusing on the following aspects: Rapid product innovation and customization. thus having a source of low-cost fund and competitive advantage in terms of lending activities.3 Consumer Business . however. and Engaging in CSR initiatives involving Consumer clients. Capacity development of entrepreneurs. Developing new service capacities to offer better and unique financial solutions to clients. and ensure continuous flow of business in future. Restricting the size of the Consumer team. IDLC’s specific strategy measures include: More focus on strengthening the deposit base. IDLC is contemplating opening of a branch in Khulna. 32 of 45 . incorporating attributes appealing to a growing number of customers. for deposit. excepting Deposit mobilization team. In addition to having SME presence across all branches of IDLC. SME has two dedicated Sales Centers in Dhaka as well to attend to walk-in clients. thus becoming a preferred service-provider for the clients. the size of the sales team has increased in the last couple of years to allow greater sourcing of deposits at IDLC. Expansion of geographic coverage by opening new branches in locations outside Dhaka with flourishing SME business.3. improved ICT platform. and Zero / Slow expansion of physical presence through additional outlets or new branches for Corporate and Consumer Divisions respectively. developing networking capacities etc.3. Increased presence through additional distribution channels and sales outlets. and thus create new opportunities for IDLC. which is currently taken care of by Bogra branch only. by not hiring for any new positions and leveraging more from the existing ones. accounting and book-keeping practices. 4. 4. Corporate tax policies. requiring greater compliance by clients and higher due diligence by IDLC while making credit decisions. Environmental regulations and labor laws. dictating short. as outlined in the diagram above and their possible impacts on IDLC’s strategic decision-making process have been analyzed below through PESTEL analysis. Political stability of the country.1. as per policy changes every fiscal year. directly affecting business performance of IDLC corporate clients involved in foreign trading. And due to bad business spells suffered by clients.Chapter 5: Environmental Factors Analysis 5. FDI policies.1. greatly affecting the overall economic performance of the country and subsequently the performance across all industries. dictated by the government and opposition parties.1 POLITICAL FACTORS: Major political factors affecting IDLC’s performance include: Budgetary measures. medium and long-term strategies by setting sectoral priorities. - Political Factors - Economic Factors - Socio-Cultural Factors - Technological Factors - Environmental Factors - Legal Factors 5. IDLC’s business performance also suffer negative consequences.2 ECONOMIC FACTORS: Major economic factors affecting IDLC’s performance include: 33 of 45 .1 PESTEL Analysis External environmental factors. affecting overall profitability of the company and its clients. dictating growth opportunities for both existing and new business. 5. Tariff policy and trade restrictions. while giving rise to demand of specialized products. Lifestyle changes leading to the introduction of new and innovative products and services to suit unique and ever-changing needs of the diverse client groups. as a safety measure against lending activities.1. greatly affecting business performance of IDLC. thus affecting commercial lending.4 TECHNOLOGICAL FACTORS: Major technological breakthroughs of IDLC over the past years include: Adoption of Oracle Flexcube Universal Banking Solution (FCUBS). healthcare and skills development of the underprivileged. and More involvement in community empowerment activities through IDLC’s CSR activities in the areas of better education. Provisioning requirements. This system has enabled creation of a number of satellite systems to further enhance IDLC’s 34 of 45 . Favorable savings policies. Greater women empowerment. such as Women Entrepreneur Loan offered by IDLC’s SME Department. resulting in more female participation across the organization and thus adding a new dimension in the strategic decision making process of IDLC. thus allowing higher lending activities. the new Core Banking Platform that became operational across IDLC in January 2012. influencing inter-bank lending activities.3 SOCIO-CULTURAL FACTORS: Major socio-cultural factors affecting IDLC’s performance include: Population growth generates more demand for financial services. resulting in opening of new branches and geographic expansion.1. ultimately affecting overall organizational performance. Restrictive policy measures by Bangladesh Bank to control money supply and inflation determines lending rates for banks and FIs. 5. boosting deposits in IDLC. 5. making IDLC the first non-banking financial institution to use this platform. as declared by Bangladesh Bank. Increasing literacy rates brings more people under the umbrella of formal banking and financial services. Repo and reverse rates. Moreover.operational efficiency and MIS generation. Green Banking activities and guidelines issued by the Bangladesh Bank not only requires all banks and FIs to focus more on environmentally sustainable projects and sectors for commercial lending. Major achievements in this regard include gradual process of server virtualization. cost minimization and reduced negative impact on the environment. HR Automation project to manage growing number of employees and relevant HR issues more efficiently across the IDLC Group. New business opportunities arising through various policies and regulation issued by the government. mandatory installation and use of ETP (Effluent Treatment Plants) in sectors such as textiles provides a new financing opportunity for IDLC for this purpose. Performance Management. 5. but also to streamline its internal operations and 35 of 45 .1. linking all branches and employees of IDLC across various geographic locations. and we are on our way to complete two years of efficient operation on this platform. Moreover. and is scheduled to be launched by the end of 2013.5 ENVIRONMENTAL FACTORS: Major issues affecting IDLC’s business strategies in recent years include: Environmental Risk Management Guidelines issued by Bangladesh Bank in 2011. Continuous upgrade and adoption of environment-friendly technologies.000 kWh of electricity and around 120 tons of CO2 emission per year. thus saving over 200.. strong monitoring during the credit terms and joint collaboration with the clients to address and resolve environmental issues are also required as per this guideline. Unified communication network. Training Management etc. with the ultimate objective of capacity maximization. and video conferencing facilities connecting major branches and saving physical travel by employees. For example. attempt of the Government to make brick fields more environment-friendly also offers a significant prospect for IDLC to extend financing in a new sector. and Phase II includes other core aspects such as Employee Profiles. requiring all banks and FIs to conduct strong due diligence while taking credit decisions. The implementation is taking place in two phases: Phase I includes Payroll Management and has already been launched in January 2013. IDLC is regulated by the Financial Institutions Act. Being an NBFI. Environmental Principles of UN Global Compact and UN Environment Programme Finance Initiative.premises to make those more environment-friendly. and their possible impacts in strategic decision making have been analyzed below through the “Porter’s Five Forces Model of Competition”. 1993.6 LEGAL FACTORS: The functions of IDLC are regulated by Bangladesh Bank and Securities and Exchange Commission for its Capital Market operations. as outlined in the diagram below. 5. Major legal factors affecting IDLC include the followings: Being a non-banking financial institution. Any changes in this act will be applicable for IDLC as well. IDLC is not authorized to perform current and foreign currency transactions. the two regulatory bodies of IDLC.1. and accordingly will be reflected in its periodic strategies.2 Five-Forces Model of Competition Factors related to the immediate industry and competitive environment of IDLC. Interventions by the Bangladesh Bank and Securities and Exchange Commission. 36 of 45 . 5. influence the strategic decision process of the organization. regulating IDLC’s overall operations and lending processes in line with globally acceptable standards and practices. Such regulations are reflected in the strategic decisions of IDLC for the short and longer terms. and their probable influence on IDLC: 37 of 45 .Substitute Products from other Industries Supplie rs of Resour ce Inputs Rivalry among Competing Sellers Buyers / Clients Potential New Entrants The following chart summarizes strength of the impact of these five forces. There market players offer closely standardized products and services. Being an NBFI. the threats of rival companies will be low in light of the following factors: Majority of the NBFIs in Bangladesh offer specialized products and services. IDLC is one of the very few leading NBFIs offering a diversified portfolio of products and services covering all branches of financial services. many of which are dependent of these services for their revenue stream. The leading players in the market are regularly coming up with innovative products and new marketing strategies to attract and retain more customers. However. IDLC retains the strongest professionals in the market graduating from leading local and international universities. and thus capture a greater share of the market.1 Competition among Rival Companies For IDLC. if the competitive environment is analyzed considering major commercial banks as IDLC’s competitors. This mainly results from the high regulatory requirements in launching new products and services. thus raising the competition. which is another significant disadvantage. the competitive environment from rival companies is clearly differentiated into two scenarios: Competition from other NBFIs Competition from commercial banks If the competitive environment is analyzed considering only competition NBFIs. Hence IDLC is in a stronger position compared to majority of the market players in the NBFI segment. overdraft and other working capital facilities.Details of these factors have been described below: 5. being an NBFI. Hence by nature IDLC’s lending rates are higher compared to rival banks. Hence clients can easily switch between brands. This is a significant disadvantage for IDLC considering other competing commercial banks. the threats of rival companies will be comparatively higher due to the following factors: IDLC. 38 of 45 .2. Hence regular strategic revisions are mandatory to remain profitable in the market. cannot offer trade services such as opening of LCs. which is a major competitive advantage over its NBFI competitors. as well as dealing with foreign currencies. IDLC has to borrow funds from other banks which are then markedup and channeled to clients as term lending. 2.4 Bargaining Power of Client Groups The financial sector faces high bargaining power from the consumer groups attributable mainly to the following factors: 39 of 45 . while clients are more cautious in availing facilities from banks and financial institutions. In the present financial situation of the country. making it more difficult for new companies to enter the market.5. Individual and institutional clients. the major supplier groups are those offering the required fund that can be utilized for lending purposes. or even remain in the business. requiring higher interest rates on their term deposits. This reduces the likelihood of new companies entering this market in the near future. 5. Owing to high competition in the market. And major fund sources and their influence on IDLC have been mentioned below: Rival banks and financial institutions. investment is at a declining rate.2. 5. which is mostly determined by market forces. In the backdrop of the lingering effects of the past financial crisis. deposit clients are more rate-sensitive and hence have a greater bargaining power over IDLC.3 Power of Suppliers For financial institutions. and Refinancing facilities of Bangladesh Bank and foreign funds from many development organizations. many public and privately owned banks and FIs are struggling to make a profit. and major scandals like that of the Hallmark Group. This significantly raises the entry barriers.2. in the form of inter-bank exchange.2 Threats of New Entrants The threat of new entrants is low for IDLC considering the following factors: The banking and financial sector is a highly regulated market. thus weakening threats from new entrants for the existing market players. Thus demand at present is declining. Hence it will be difficult for new entrants to lure away customers and gain a considerable market share. with large initial investment requirements. in the form of term deposits. The leading market players strongly capture a significant portion of the market. having considerable influence over IDLC’s performance and compliance process to consider it eligible for availing those funds. For Corporate Financing products. banks and FIs opt to add the leading large local and multinational corporate houses in their portfolio. 40 of 45 . For the banking and financial sector. Low switching cost for the consumer groups due to largely standardized products and services offered by the competing companies. Hence this provides significant bargaining power to the client groups. threat from Substitute Products is almost non-existent considering the nature of its products and services. hence.5 Competitive Pressure from Substitute Products Threats of substitutes refer to products offered by players outside the industry that can offer similar benefits at similar prices to the consumer groups. 5.2. not only in considering of large business volumes but also to increase the quality and brand value of their overall portfolio. and Strong Brand Image Opportunities Focus on Green Financing activities Robust SME Lending Priority Team Formation under Consumer Finance Financial Literacy for Stakeholders Leveraging on Marketing Communications Highly Competitive Industry. Limitations. Strengths Effective Strategic Decision and Execution Corporate Governance Competent Management Team Strong Financial Position Diversified product portfolio.1 SWOT Analysis The following table summarizes major points concerning IDLC’s competitive analysis. in terms of its Core Strengths. Each of these points has been elaborated below. Market Opportunities and Threats to Future Growth. allowing one-stop solutions Prestigious customer base Professional Workforce Strong HR Management Technology Platform Superior Customer Services CSR Commitment.Chapter 6: SWOT Analysis 6. and Expanding Branch Network Weaknesses Higher lending rates Unauthorized to perform certain business functions Threats Greater Customer Bargaining Power Highly Rate Sensitive Clients Political and Economic Situations Regulatory Restrictions 41 of 45 . I have investigated the following parameters to get an understanding of life cycle of Bangladesh’s overall banking industry: 1) Country’s Total credit growth – all banks 2) Country’s Total Deposits growth – all banks 3) Country’s Overall Export growth 4) Country’s Import Scenario 5) Sectoral GDP growth 7.1.1 Country’s Total credit growth – all banks 42 of 45 .1 Industry Life Cycle To know which stage the banking industry of Bangladesh is in now. we need to analyze many financial parameters.Chapter 7: Analysis on Overall Banking Industry 7. In my report. 2 Country’s Total Deposits Growth 7.3 Country’s Overall Export growth 43 of 45 .1.1.7. 1.4 Country’s Import Scenario 7.1.5 GDP Sectoral Growth rate in % 44 of 45 .7. 2 Dominant Traits of the Industry The analysis of the immediate industry and competitive environment begins with an analysis of the dominant features of the industry. Figure: The life cycle curve shows in which stage Bangladesh’s banking industry is in 7. we see that Bangladesh’s banking industry is still in growth stage.Considering all the above facts. thus gaining a comprehensive overview of the industry landscape. Major economic features of the financial services industry include: 45 of 45 . technological competitiveness and strong pool of human resources. Degree of Product and Service Differentiation: There is not much scope of high product differentiation in the financial services industry. Number of Rival Companies in the Market: The financial services sector is characterized by high level of competition among the rival companies to maintain existing market position while trying to capture more market share. owing to intense competition among the rival companies resulting in low switching cost for the customers from one service provider to the next. which leads to heightened competition in terms service quality and pricing strategy among the competitors. Demand-supply Condition: A significant share of the country’s population is still beyond the reach of the formal banking and financial services sector.Market Size & Growth Rate No of Industry Rivals Technological Changes Bargaining Power of Customers Product and Service Differentiation Demand-Supply Conditions The following section presents a brief on each of these economic features: Market Size and Growth Rate: The market size and growth rate is an important indicator of future business prospects of the market players. thus posing a 46 of 45 . and strategic measures needed to secure existing market position and capture new market share. Moreover. service standards. showing level of product and service innovations required for the future. market is dominated by a few top market players having gained competitive advantage over rival companies in terms of product offering. Bargaining Power of the Customers: This industry is characterized by high bargaining power of the customers. significant opportunity for the existing market players to expand their business. Pace of Technological Changes: Technology plays a major role in advancing the industry by allowing new product and service standard innovations. The major industry driving forces include: Increasing Globalization Changes in Customer Profile Product Innovation Technological Changes Regulatory Influences Government Policy Changes Changing Societal Concerns and Lifestyles 47 of 45 . thus allowing more sophisticated service delivery to the clients. and for new entrants in the industry. 7. competitors and suppliers to alter their strategies and actions.3 Drivers of Industry Change The Driving Forces of an industry are the major underlying causes of changing industry and competitive conditions by influencing customers. Such forces are the biggest influences on how the industry landscape will alter. but also those of their clients from different industries. since it affects not only the operations of the banks and FIs. which is a significant driving force for banks and FIs. also customized as per client needs. Government Policy Changes is another major industry force. Changes in Customer Profile. and the Securities and Exchange Commission in terms of capital market operations. making competition more intense through increasing involvement of multinational and overseas companies in the financial sector.The following section identifies impact of each of these driving forces in shaping the industry.Better customer service . product mixes and financial solutions.Area coverage / presence (onsite / internet / mobile) .Sector focus 48 of 45 . This being a highly regulated sector. raising demands for more sophisticated savings and loan products and complete financial solutions for both individual and institutional clients.Low lending rates . Product Innovation.4 Key Success Factors . which should be a continuous process to tap different market segments. which results in change of strategies for banks and FIs. and Changing societal concerns and lifestyles. Technological Changes. 7. requiring continuous innovation in terms of product and service features to match their changing needs and requirements. banks and FIs must be fully compliant to the policies and regulations of the Bangladesh Bank. which is crucial in today’s world to provide faster and more efficient service. while offering an insight into the external environmental factors affecting the industry: Increasing Globalization. client groups and geographic locations with customized products. Regulatory Influences. Continuously update its strategic group mapping to have clear understanding about its market position and close competitors. Focus more on SME financing activities and capacity development of small and medium entrepreneurs to leverage more from a growing sector and create new client groups. revising business models and strategies in a timely manner in response to changing market scenario and competitor moves. This has been achieved over the years through a combination of strong and properly balanced strategic objectives. and consideration of the following factors is strongly recommended to achieve that objective: Update the vision statement to add more specific and tangible goals and targets. Improve gender balance and thus add a new dimension to the strategic decision-making process. strong management leading to efficient strategy development and execution. IDLC believes in continuing its pursuit for further growth and improvement. 49 of 45 .Chapter 8: Recommendation and Conclusion 8. as well as investment in green financing activities in line with the requirements of Bangladesh Bank. and accordingly develop or revise strategies to respond to strategic moves of its competitors. Continue investment to upgrade its technological platform to be the best in terms of quality of product and service delivery. Leverage on environmental regulations by identifying new business opportunities.1 Recommendation and Conclusion In light of the discussion and analysis of various factors influencing IDLC’s performance and the industry as a whole. we can draw the conclusion that IDLC holds a strong position in the banking and financial services sector of Bangladesh. However. and analyzing factors of the external environment and the immediate industry and competitive environment and accordingly taking measures to engage those in IDLC’s favor. and expanding its geographic coverage through increased branch network. priority team formation under Consumer Division. financial literacy for stakeholders to create new client groups. growth in SME lending. environment and the community. Use intense market competition as a driving force for greater innovation in terms of product and service delivery. and thus create a unique brand position for IDLC 50 of 45 . Leverage on the market opportunities identified through SWOT Analysis. such as green financing. Improve its core strengths even further to continue holding a strong competitive position in the market. leveraging more from marketing communications activities. and financial solutions. Engage in more CSR activities benefiting its major stakeholders. quality.