CitibankA Case Analysis

Cheryl Bluthardt, Brandy Church, Dawn Townley, and Amanda VanKoevering

ProfileGaining familiarity with the

Citibank organization

Global, multidimensional financial institution

Leaders include:◦ Sanford Weill, Citigroup’s chief executive◦ Jorge Bermudez, Citigroup’s executive vice

president Employed > 325,000 staff Serviced > 200 million customers Operated in > 100 countries

Critical Facts of the Case

Hitt, M.A., Ireland, R.D., & Hoskisson, R.E. (2011). Strategic Management: Competitiveness and Globalization (9th ed.). Mason, OH: South-Western Cengage Learning.

Become the world’s leader in e-business. Strategy – Connect, Transform, Extend First priority – meeting customer needs.

“We are here to serve our clients: whatever our clients want us to do we’ll do it for them.”

- Caroline Wong, Head of E-Business Group (Cash & Trade), Citibank Hong Kong (p. 105)

Company’s Mission and Vision

Hitt, M.A., Ireland, R.D., & Hoskisson, R.E. (2011). Strategic Management: Competitiveness and Globalization (9th ed.). Mason, OH: South-Western Cengage Learning.

SymptomsIndicators that something is not as expected or desired

Citibank experienced difficulty:◦ meeting diverse customer needs ◦ earning profit◦ maintaining supremacy amongst intense business

competition

Symptoms

Hitt, M.A., Ireland, R.D., & Hoskisson, R.E. (2011). Strategic Management: Competitiveness and Globalization (9th ed.). Mason, OH: South-Western Cengage Learning.

GoalsGoals for the future

Provide customers with technology to conduct secure business anywhere

Align with partner companies New technology to streamline A/R, A/P, and

liquidity management Reach new markets Improve customer service Cut costs

Goals

Hitt, M.A., Ireland, R.D., & Hoskisson, R.E. (2011). Strategic Management: Competitiveness and Globalization (9th ed.). Mason, OH: South-Western Cengage Learning.

AnalysisModels used to conduct the

analysis

Industry Trends include:◦ Use of technology to increase banking efficiency

(Hitt, et al, 2011) ◦ Use of electronic payments (Hitt, et al, 2011)◦ Increased number of consumers with credit cards

(Citibank, 2006)◦ Preference of brand recognition and proven

history of financial security (Hitt, et al, 2011).

General Environmental Analysis

SWOT Analysis

Strengths:• Strong Brand Recognition• Continuous Investments in

Technology• Global Presence• Diversification of Products and

Services

Weaknesses:• Declining Capital• Debt Obligations Due to

Subprime Market• High Customer Demands• Complicated Products• Lack of ability to keep up with

advancing technology

Opportunities:• Expand Good Reputation• Improve Existing Web

Features & Expand Global Banking

• Increase Customer Service• Offer Fresh Approach to

Banking

Threats:• Competition• Heavy Investments in

Technology• Regulatory Scrutiny• Weakening Financial Markets

Hitt, M.A., Ireland, R.D., & Hoskisson, R.E. (2011). Strategic Management: Competitiveness and Globalization (9th ed.). Mason, OH: South-Western Cengage Learning.

Profitability Ratios = acceptable Liquidity Ratios = acceptable Leverage Ratios = acceptable Activity Ratios = acceptable Shareholders’ Return Ratios = acceptable

Financial Analysis

Hitt, M.A., Ireland, R.D., & Hoskisson, R.E. (2011). Strategic Management: Competitiveness and Globalization (9th ed.). Mason, OH: South-Western Cengage Learning.

A look at Citibank’s Consumer

Citigroup. (2006). 2005 Financial Information. Retrieved April 13, 2011 from http://www.citigroup.com/citi/fin/data/k05c.pdf?ieNocache=353.

DiagnosisDiscrepancies between

Citibank’s goals and actual performance

Rapidly changing customer needs with limited resources to provide technologically advanced products.

Root Problem

Goal Options

Improves Quality

Cost to Implemen

t

Time Required

Ease of Staffing

Financial Return

TOTAL Points

Technology enabling customers to conduct business anywhere

3 2 2 3 3 13

Partner alignment

3 3 1 3 3 13

Technology-based A/R, A/P, and liquidity mgmt

3 2 2 2 2 11

Reach new markets

1 1 1 2 3 8

Customer Service

3 1 1 1 2 8

Cut costs 1 1 1 1 3 7

Goal Matrix

Align with Square to make their credit card processing software/hardware available to current Citibank customers, allowing customers to conduct secure credit card processing anywhere anytime at low cost.

Selected Goal

Action PlanHow to improve Citibank’s

situation

• Developing and implementing marketing campaign

• Creating processes for Sales Department once marketing plan has been implemented

• Collaborating with Square to accommodate back-end accounts receivable and accounts payable software

• Negotiating terms with Square

Leadership

IT

MarketingOperations Processes

(Sales)

Action Plan

Questions?

Citigroup. (2006). 2005 Financial Information. Retrieved April 13, 2011 from

http://www.citigroup.com/citi/fin/data/k05c.pdf?ieNocache=353.

Hitt, M.A., Ireland, R.D., & Hoskisson, R.E. (2011). Strategic Management: Competitiveness and Globalization (9th ed.).

Mason, OH: South-Western Cengage Learning.

References