Thursday, November 7, 2019

The Royal Bank of Scotland

The Royal Bank of Scotland The Royal Bank of Scotland (RBS) is the top performer in the international banking industry and is one of the biggest world’s banking institutions. This multinational corporation currently employs over 150,000 of workers all over the world and operates in more than 40 countries (RBS, 2015).Advertising We will write a custom essay sample on The Royal Bank of Scotland specifically for you for only $16.05 $11/page Learn More It maintains its reputation as a top player at the global financial service market with the world class services provided to its customers. RBS is remarkable for the excellent leadership practices and governing strategy enabling the corporation to handle the changes and challenges that take place in the industry. This paper aims at the evaluation of the RBS organization sustainability and corporate social responsibility (CSR). Since 1727, RBS has been a top performer in the provision of financial services in Europe. Today, this inter national banking corporation with the headquarters in Edinburg, Scotland has become a leader in the industry all over the world. Through the major subsidiaries Royal Bank, Ulster Bank, Coutts, and Nar West, RBS successfully works in the number of the largest financial markets including Europe, Asia, and America (Kemal, 2011). As a leading financial service provider, RBS does not only ensure the achievement of higher revenue for its offered services, but above everything, profitability. In 2014, RBS operational profit was at the rate of  £3,503 million (RBS sustainability, 2014). At that, the leverage ratio was 4.2% and the net interest margin was 2.23%. All these variables considerably exceeded the results of the previous year demonstrating the success of the company operational decisions. RBS financial priorities are (1) strengthening the capital position, (2) bringing the cost base in line with the smaller banks being acquired; and (3) restructuring away from the olden â€Å"Gr oup† business model (RBS sustainability, 2014). With the recent economic recession, RBS implemented new policies to its business with an objective to manage uncertainty at the market. The bank has developed new elemental management approaches and leadership innovations to ensure adaptability to the change (RBS, 2015). Understanding that the major organizations providing financial services have to initiate change addressing the problems connected with uncertainty at the market, and not doing so would only lead to their disadvantage in the future, RBS has gone through a row of organizational changes within the recent period (Rose Hudgins, 2010).Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More To maintain the level of profitability, RBS (1) differentiated offerings through diversified customer segments; (2) ensured prompt adoption to external changes; (3) created corresponding management roles and organizational structures to increase the level of coping with change; and (4) facilitated the strong support of the human resources.RBS competitive advantage is the ability to restructure its business to adapt to the current business situation with the help of the timely and well-weighted decision-making (Huisman, 2011). RBS is thus well known for its ability to create management roles and organization structures. It is also remarkable in its acquisition strategy. Since the end of the eighteenth century, RBS has been renowned as â€Å"a leading banking partner to major corporations and financial institutions around the world, providing an extensive range of debt financing, risk management and investment services to its customers† (RBS, 2015). Next, to promote organization sustainability, RBS continues to invest resources into staff training and expertise building (Kemal, 2011). HR management and policies are important approaches the company is actively implementing with refinements based on the current market needs. Some of these include major adjustments such as being quick to adopt major changes. At present, RBS is quick to employ strengthening of its employee relations by making sure the right reward goes to the right person (RBS, 2015). This strategy creates a form of motivation that does not only promote quality, but the substantial form of quantity at the same time (Worthington Welch, 2011). RBS has been good at raising the engagement level of its employees, as there has been found an increasing productivity because the level of engagement has been rising. The company is also putting a lot of effort into the team building through celebrating diversity and welcoming the open thought exchange (RBS, 2015). Further, RBS has the ability to make use of the adoption of existing opportunities from its external environment. In 2013, RBS was quick to adopt new technology for the hope of delivering high customer value and increase pro fitability (RBS sustainability, 2014).). In 2015, RBS continued to boost its image as a global leader of innovation by means of integration into Ripple (RBS, 2015). This decision enables RBS to decrease operational costs and provide its customers and partners with the new cross-border payment services (RBS, 2015). The company pays constant attention to the continual review of the cyber security control to ensure on-line customer safety despite the growing number of cyber fraud cases (RBS, 2015). In mind with eliminating the cyber safety and security problem the company experienced in 2011 and 2012, RBS is looking for the partnerships with the teams developing advanced technologies for a more resilient on-line banking (RBS sustainability, 2014). Currently, the organization reports considerable progress in the field of on-line banking security (RBS, 2015).Advertising We will write a custom essay sample on The Royal Bank of Scotland specifically for you for only $16.05 $11/pa ge Learn More Regarding CSR, RBS focuses on customer trust because the company leadership believes it to be inextricably connected with sustainability (RBS sustainability, 2014). To gain customer loyalty and win customer trust, RBS has developed the market segmentation strategy enabling it to focus on customer interests in various fields. The company market segmentation strategy is made possible through segmenting customers into retail, commercial and corporate. The good thing about this strategy is making sure of maximizing opportunity for RBS by providing to various needs of its target customers to end up with sustainable operation. As a result, RBS has finally succeeded today in providing personal, private, business and corporate banking experience for diverse customer segments particularly in the UK, leading to a programme of raising capital around  £22 billion in 2013 (RBS, 2015). The company does not stop at this point and has further ambitious goals in the a rea of CSR as follows from its annual report, â€Å"RBS has a clear ambition to be number one for customer service, trust and advocacy in each of our chosen business areas by 202† (RBS sustainability, 2014, p. 11). As for the RBS social, economic and environmental impact, the company is working hard to organize its organizational strategy around the major goal of putting the customer first (RBS, 2015). In line with the objective to prioritize customer interests, the company leadership builds the business according to the interests of its employees (RBS, 2015). The company CEO, Mr. Ross McEwan, described RBS vision in this area with the following words: â€Å"we won’t engage our customers if we don’t engage our staff, and so we are looking very closely at how we improve leadership at RBS, and how we make this a rewarding place to workâ€Å" (RBS sustainability, 2014, p. 3). The company pursues its ultimate social role as being an assistant for a common person i n realizing one’s dreams and ambitions. How this role is being realized is best seen in the following comment by Mr. Ross McEwan: First and foremost I define our relationship with society through how well we are serving our customers. If we are supporting their ambitions to buy a home, start a business or grow their company – and doing that responsibly then I think that has a very positive influence on society (RBS sustainability, 2014, p. 3). While serving the customers’ basic needs, RBS does not forget about the global environmental concerns. The company engages in the wide range of measures aiming at improving the environment including the initiative to shift to a low carbon economy, introduce energy efficiency technology at every big building around the world, eliminate wastes to the landfill, decrease the paper usage in business, and promote unnecessary water usage reduction (RBS, 2015).Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More In conclusion, evaluating RBS organization sustainability from the perspective of the materials learnt in class, the company developed an effective approach not only to ensure profitability, but to guarantee competitive advantage in its industry (Thompson Martin, 2010; Wheelen et al., 2015). Its ability to create major innovations and substantial changes promotes its potential to stay on top in the financial service industry, ensuring its sustainable operation while taking the opportunity to provide high value for customers and generate profit (Managing for Competitive Advantage, 2012). Moreover, RBS demonstrates peculiar achievements in raising the engagement level of its employees and increasing productivity because of the high level of engagement (Heizer Render, 2011). References Heizer, J., Render, B. (2011) Operations management, 10th edition. London: Pearson. Huisman, W. (2011). Corporate crime and crisis: causation scenarios. In M. Deflem (ed.) Economic crisis and crime (s ociology of crime law and deviance (pp.107-125). London: Sage. Kemal, M. U. (2011). Post-merger profitability: a case of Royal Bank of Scotland (RBS). International Journal of Business and Social Science, 2 (5), 157-162. Managing for competitive advantage (2012). Harlow: Pearson Custom Publishing. RBS sustainability report 2014. (2014). Web. RBS: Here for you. (2015). Retrieved from https://personal.rbs.co.uk/personal.html Rose, P., Hudgins, S. (2010). Bank management financial services. New York: McGraw-Hill Publ.Comp. Thompson, J., Martin, F. (2010). Strategic management awareness change, 6th Edition. London: Cengage Learning. Wheelen, T.L., Hunger, J.D., Hoffman, A.N., Bamford, C.E. (2015). Strategic management and business policy (global edition), 14th Edition. London: Pearson Education. Worthington, S. Welch, P. (2011). Banking without the banks. International Journal of Bank Marketing, 29 (2), 190 – 201.

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