Factor

Analysis OF
SBI
Introduction
State Bank of India (SBI) is an Indian multinational, public sector
banking and financial services company. It is a government-
owned corporation with its headquarters in Mumbai,
Maharashtra.
The bank is ranked 232nd on the Fortune Global 500 list of the
world's biggest corporations as of 2016.
SBI provides a range of banking products through its network of
branches in India and overseas, including products aimed
atnon-resident Indians(NRIs)
Chairperson:Arundhati Bhattacharya
Major Competitors
 Pest Analysis
POLITICAL FACTORS-
Government intervenes- Government support the industry to expand and
introduce new services.
Trading policies- Trading policies are also favourable for SBI so that it can
introduce new services in market and grow.

ECONOMIC FACTORS-
Consumer focus- They are continuously focussing on analysing the consumer
needs and develop products to fulfil there needs.
Living Standard- Rise in the living standard of people have increased their
consumption of services and produce high quality services.
National Income- If per capita income is more the amount spend will be more
and if per capita income is low the amount spend would be less.
Continued..
SOCIAL FACTORS-
Small banks are growing at fast speed.
Changing trends .
Deliver the positive image of bank in society.

TECHNOLOGICAL FACTORS-
Fast exchange of information has become the in-thing for stakeholders and
consumers.
Faster services with upgraded technology.
Timely delivery of information and services.
Best quality services.
 SWOT Analysis
Strengths Weakness
Market Share NPAs
Technology outsourcing
Brand loyalty
Business Risk
Large Manpower
Poor Customer Services
Internet Banking Unstructured enterprise
High Customer Base Delay in services
Largest bank network in India
Foreign Collaborations
Safety and security

Opportunities Threats
Merger with Other Banks Customer Shifting to foreign banks
Investment with International New bank licenses
Operation GST(will increase cost of service
Advanced Technology providing)
Better use of CRM Advanced technology of private
Advantage from cashless economy banks
Porters Five Forces Model
I. Rivalry among existing firms: In all markets where SBI operates is fierce. SBIs major competitors in
banking industry are State Bank of Patiala, HDFC, Axis Bank. Moreover, SBI policies(interest rate and
lending rates competes with HDFC which runs on most competitor services. Cost leadership has been
adopted by the majority of SBI competitors as one of the basis of competitive advantage.
II. Bargaining Power of Suppliers: SBIs main supplier is the company from which SBI outsource its
technology.
III. Bargaining Power of Buyers: SBI have a large customer base i.e they have huge buyers but the ultimate
control is in hands of the bank. Bank donot give option of bargaining to customers as interest rates and
lending rates are fixed by bank.
IV. Threat of New Entrants: SBI has a strong brand image, innovation and customer
service making it difficult for new entrants to compete against. New entrants will
have difficulty matching or beating the cost structure.
V. Threat of Substitutes Products: SBI mitigates this effect by selectively introduce
services which might ultimately replace the saving accounts Eg: 7% interest rates by
Airtel payment bank.
.
Matrix Competitive Profile

SBI SBI SBI HDFC HDFC HDFC
Weight Rating Score Weight Rating Score

Untapped markets such as 0.14 2 0.28 0.14 3 0.42

rural market
Network capabilities and 0.07 2 0.14 0.07 1 0.07
low tariffs of service
providers
Strong customer demand 0.12 3 0.36 0.12 2 0.24
low interest rates on loans
Dependence on utility 0.13 1 0.13 0.13 1 0.13
application
Rapid technological 0.6 4 0.24 0.6 4 0.24
change
High barriers to entry 0.13 2 0.26 0.13 3 0.39

Bargaining power of 0.10 3 0.30 0.10 3 0.30

suppliers
Intense competition 0.25 2 0.50 0.25 2 0.50
1.00 2.31 1.00 2.29
External Audit Class Score
External Factor 2.75
External Factor Evaluation Evaluation (EFE)
(EFE) Matrix Matrix

Internal Audit Internal Factor 2.65

Evaluation
Internal Factor Evaluation VRIN Model
VRIN Model
STRATEGIC 3.20
STRATEGIC FACTOR FACTOR
ANALYSIS SUMMARY ANALYSIS
SUMMARY
 External Factor Evaluation (EFE)
Matrix
Key External Factors Weight Rating Weighted
Score
Opportunities
Merger with Other Banks 0.09 3 0.27
Network capabilities and low tariffs of service 0.11 2 0.22
providers
Strong customer demand for innovative services 0.06 4 0.24
Better use of CRM 0.07 3 0.21
Advantage from cashless economy 0.07 3 0.21
Government initiative of digital India 0.13 4 0.48
Threats
Bargaining power of consumers 0.02 3 0.24
New competitors are entering markets 0.06 1 0.06
Intense competition 0.17 1 0.11
Declining interest rates imposed on loans 0.12 3 0.45
Rapid technological change 0.07 2 0.14
Low barriers to entry 0.03 4 0.12
 VRIN Model
The VRIN framework for SBI. For gaining competitive lead over its competitors SBI should
explore its internal as well as the external advantages, its internal advantages that SBI paid
attention is to develop existing services, and its brand name, advanced technology, and
effortlessness of using the user interface.

Value
SBI is valuable as it is a price maker and charges the interest decided by the Bank. The
customers value the brand and hence pay the interest charged by the Bank.

Rarity
Bank has a unique design, quality, easy to use and is also a status symbol among the
youngsters.

Inimitability
The environment which the bank provides to its employees and customers is inimitable
moreover SBI bank is the safest bank in terms of liquidation.
 BCG Matrix
Relative Market Share
Market Growth Star Question Mark
Rate Home loans Medical insurance
Car loans Joints Accounts
High Lockers
Smart Cads
ATM

Cash Cow Dog

Saving accounts
Current accounts
Credit cards
Debit Cads
Low

High Low
Key Strategies

Expansion of Market Share through mergers and acquisitions of smaller banks.

Internet Banking experience could be improved through technological
advancement.
Through mergers we can reduce the risk of loss of Market Share.
Through improved Internet banking we can reduce the customer that are switching
to foreign banks.
High business rich of customers switching to foreign banks.
Better use of CRM for improving the experience and quality of product and services.
Technological advancement to reduce technology outsourcing.
Providing loans online through cashless economy.