Compilation of SWOT matrix based on FMEA and SMEA models in banks

Dissertation for Master's Degree (M.A)

Department of Business Management - Financial Orientation

Abstract:

Banks play an important role in realizing macroeconomic goals and helping to implement strategic projects of the country, on the other hand, the basic goal of every financial institution, especially banks, is to attract customers and, as a result, attract resources at the community level and invest in different sectors of the economy. Considering the importance of human and financial resources In banks, as well as the optimal use of these resources in the face of upcoming opportunities and threats, strategic planning should be done in this sector. In this research, by compiling the SWOT matrix [1], we evaluated the external and internal environment of Mehr Economy Bank branches in Gilan province. The statistical population of the research was made up of managers and high-ranking experts of all branches in Gilan province, which are 50 people in total, and because the number of people in the community is limited, therefore sampling was not done and all people in the community were selected as samples. In order to collect information, the first questionnaire was used to evaluate the internal environment of the branches, which was developed in the framework of the BSC model [2], and to evaluate the external environment, the second questionnaire was used using the FMEA method [3] to identify threats, and the SMEA model [4] was used to identify External opportunities were used, after confirming the validity of the questionnaires through the content method and also confirming their reliability through the Cronbach's alpha method (?=0.86 for the first questionnaire) and (?=0.84 for the second questionnaire), the information obtained to compile the SWOT matrix was analyzed by the mentioned methods by Excel software, the results showed that the greatest strengths in customer factors and the greatest weaknesses of the branches are in terms of growth and learning and internal process. Taking environmental opportunities and adjusting threats according to the strengths and weaknesses of the branches in the SO field (6 strategies), in the wo field (5 strategies), in the ST field (4 strategies), and in the WT field (4 strategies), considering the strategic position of the Islamic Revolutionary Guard Corps in the country and its support from Mehr Eketaz Bank as a valuable opportunity, the focus of integrated strategies to penetrate as much as possible in the competitive market of banks and maintain the current position, empowering human resources with up-to-date training in the field Banking and upgrading the system are suggestions and in order to strengthen the perspectives of the internal process of providing diverse and modern banking services and connecting to the Shatab network to provide more productive services according to the economic and cultural potential of the province, it was suggested.

Keyword: Strategic planning, SWOT matrix, FMEA, SMEA, Mehr Economy Bank of Gilan province

1-1- Introduction

Introduction of performance management and its application plays an important role in the banking system, therefore knowing the new methods of strategy formulation is very effective (Zehner, Ali, 2009) [1] In this regard, strategic formulation and its implementation is the key responsibility of executive managers in every business organization. Strategy development includes analyzing the current situation and the ideal situation, and then making a decision regarding determining the most effective way to achieve the relative goals. (Kotal, 2011) [2] Despite the importance of strategic planning, in many organizations, its vital effects in achieving the organization's goals are not well understood, and even in some cases, managers consider it a luxury and expensive task. (Ansari) et al., 2018) one of the effective methods of formulating the strategy of organizations is the process of evaluating the internal and external environment of the organization, the process of evaluating the internal and external environment of the organization is called internal and external analysis, which provides a realistic and reliable scale for evaluating the organization, because it includes the identification of areas of weakness, strength, threat, and opportunity. (Roli Deji and Atal, 1997)

1-2-Statement of the problem

Banks play an important role in realizing macroeconomic goals and helping to implement the country's strategic projects, on the other hand, the main goal of every financial institution, especially banks, is to attract customers and, as a result, attract resources at the community level and invest in different sectors of the economy.Considering the importance of human and financial resources in banks, as well as the optimal use of these resources against the opportunities and threats ahead, strategic planning should be done in this sector. It is to the goals of the organization. (Vitek Crabb, 2012) [4] Developing a strategy is often a complex process, which requires adopting a systematic approach to identify external factors, and matching these factors with the internal capabilities of the organization. (Weirich, 1982 and 1999) [5] The success and failure of an organization depends on how effectively it develops, implements, and monitors strategies. (Ko et al., 2009) [6] Many approaches and techniques can be used to analyze the internal and external environments of the organization and strategic matters and as a result formulate strategies, including strategy formulation techniques, BCG matrix, Porter's five forces, Mackenzie's seven s model, quality function development, balanced scorecard. and SWOT. (Bisaidi, 2014)[7] SWOT[8] is the most common and famous technique and a management support tool for decision-making, and it is generally used for the systematic analysis of internal strengths and weaknesses, opportunities and environmental threats of the organization in order to reach a systematic approach and support decision situations. (Mehli and Dhomi, 2012) The measures of both financial and non-financial dimensions cause the flow of strategic goals throughout the organization, so it links the performance of the organization's people with strategic goals (Kaplan, 1994) [10] The views defined in the balanced scorecard can be a suitable framework for developing the SWOT model. Several researches have been carried out in the field of estimating and quantifying the size of opportunities and threats, which two calculation techniques FMEA [11] (Failure Modes and Analysis of its Effects) to predict and manage risks and [12] SMEA (Success Modes and Analysis of its Effects) to predict and manage opportunities were first implemented in the research of Ku [13] and colleagues in 2008 in a large factory manufacturing consumer products in China to estimate the quantitative size of opportunities and threats. Etal, 2011)[14] in this research, we will deal with the compilation of SWOT matrix, relying on the perspectives of balanced scorecard and FMEA&SMEA models for Bank Mehr Ekhetaz branches in Gilan province,

now the basic question that is raised in this research is:

the most suitable strategies according to the results of the analysis of the external environment including opportunities and threats as well as the analysis of the internal environment including internal strengths and weaknesses for Bank Mehr Ekhetaz branches in the province Which is Gilan?

1-3-Research Objectives

Given that banks are exposed to intense competition in domestic markets, therefore adopting and formulating strategic plans to strengthen banking can be effective, but this planning should be based on strategic thinking. Because the strategic management approach emphasizes the interaction of managers of all levels and organizational hierarchies in planning and implementation, currently scientific and systematic methods are not used for strategic planning in Bank Mehr Ekodzat Branches of Gilan Province.

Therefore, the scientific purpose of this research is:

Helping the aforementioned organization to formulate macro-organizational strategies to ensure the survival of the organization in the competitive market.

The most suitable strategies for this organization are introduced.

Based on a scientific mechanism, the strengths and weaknesses, as well as the opportunities and threats of this organization have been reduced in order to predict and manage risk more successfully.