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Strategic Management Process
Chapter 1:
THE BANKING INDUSTRY
1.1 INTRODUCTION
In todays dynamic world banks are inevitable for the development of a country. Banks play a pivotal
role in enhancing each and every sector. They have helped bring a draw of development on the worlds
horizon and developing country like India is no exception.
Banks fulfill the role of a financial intermediary. This means that they act as a vehicle for moving
finance from those who have surplus money to (however temporarily) those who have deficit. In
everyday branch terms, the banks channel funds from depositors whose accounts are in credit to
borrowers who are in debit. Without the intermediary of the banks, both their depositors and their
borrowers would have to contact each other directly. This can and does happen of course. This is what
has lead to the very foundation of financial institution like banks. The Banks have developed their roles
to such an extent that a direct contact between the depositors and borrowers in now known as
disintermediation. Banking industry has always revolved around the traditional function of taking
deposits, money transfer and making advances. These three are closely related to each other, the
objective being to lend money, which is the profitable activity of the three. The Banks have introduced
progressively more sophisticated versions of these services and have diversified introduction in
numerable areas of activity not directly relating to this traditional trinity.
1.2 ABOUT THE BANKING INDUSTRY
1.2.1. History of Banking in India
Without a sound and effective banking system in India, there cannot be a healthy economy. For the
past three decades India's banking system has several outstanding achievements to its credit. The most
striking is its extensive reach. In fact, Indian banking system has reached even to the remote corners of
the country. This is one of the main reasons of India's growth process.
The government's regular policy for Indian bank since 1969 has paid rich dividends with the
nationalization of 14 major private banks of India. Money has become the order of the day.
The first bank in India, though conservative, was established in 1786. From 1786 till today, the journey
of Indian Banking System can be segregated into three distinct phases. They are as mentioned below:
Early phase from 1786 to 1969 of Indian Banks

Nationalization of Indian Banks and up to 1991 prior to Indian Banking Sector Reforms.
New phase of Indian Banking System with the advent of Indian Financial & Banking Sector
Reforms after 1991.
The banking industry has moved gradually from a regulated environment to a deregulated market
economy. The market developments kindled by liberalization and globalization have resulted in changes
in the intermediation role of banks. The pace of transformation has been more significant in recent times
with technology acting as a catalyst. While the banking system has done fairly well in adjusting to the
new market dynamics, greater challenges lie ahead.
1.2.2. Indian Banking System
The banking scenario in India has been changing at fast pace from being just the borrowers and lenders
traditionally, the focus has shifted to more differentiated and customized product/service provider from
regulation to liberalization in the year 1991, from planned economy to market. Political compulsions
brought about nationalization of bank in 1969 and lobbying by bank employees and their unions added
to the list of nationalized banks a few years later. Slowly the unions grew in strength, while bank
management stagnated. In the meantime, technology was becoming a global phenomenon lacking a
vision of the future and the banks erred badly in opposing the technology upgradation of banks.
The rules of the game under which banks operated changed in 1993. Norms or income Recognition,
Assets classification and loan loss provisioning were put in place and capital adequacy ratio become
mandatory.
The amendment of banking regulation act in 1993 saw the entry of new private sector banks and
foreign banks.
Figure 1 :- Structure of Banking System in India

At present there are 27 Public Sector Banks, about 30 Private Sector Banks, 40 Foreign Banks and 196
RRBs, 52 Urban Co-operative Banks, 16 State Co-operative Banks, 19 Nationalized Banks, 8 State
Bank of India Associates and about 68,000 branches exist across the country.
1.2.3. Growth and present status of the industry

Currently (2014), banking in India is fairly mature in terms of supply, product range and reach-even
though reach in rural India still remains a challenge for the private sector and foreign banks. In terms of
quality of assets and capital adequacy, Indian banks are considered to have clean, strong and
transparent balance sheets relative to
other banks in comparable economies in its region. The Reserve Bank of India is an autonomous body,
with minimal pressure from the government.
Figure 2 :Projected
growth rate
for banks
1.2.4.
Future
of
the industry
The burden of
reporting
and
other
regulatory requirements will fall heavily and disproportionately on small banks unless remedial action
is taken. Further advances in information technology will permit the development of new products,
BANK, and risk-management techniques but may also pose important competitive and supervisory
issues. Nonbank entities will continue to offer bank-like products in competition with banks, raising
new the question of whether banks are still special and, more fundamentally, whether banks are
sufficiently different from nonblank firms to justify the maintenance of a safety net for banks. It is
useful, therefore, to try to chart the course of the banking industry in the next five to ten years and to
consider what policy issues the industry and regulators will face. The authors of this study do
not pretend to be clairvoyant. They are mindful of the many financial predictions that were once
offered with confidence but turned out to be wrong or premature. This
study is perhaps best described as an exercise in strategic thinking. Its approach is to analyze what has
happened in the recent past, consider in detail reasons for expecting
Figure 3 :- Challenges faced by the banking industry

recent trends to continue or to change, and draw the consequences for bank and regulatory policies. As
always, uncertainties abound, and events that may now appear fairly improbable may in fact shape the
future.
Chapter 2:
THE COMPANY PROFILE: HDFC BANK LTD.
The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an
in principle approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as
part of RBIs liberalization of the Indian Banking Industry in 1994. The bank was incorporated in
August 1994 in the name of HDFC Bank Limited, with its registered office in Mumbai, India. HDFC
Bank commenced operations as a Scheduled Commercial Bank in January 1995.
PROMOTER
HDFC is Indias premier housing finance company and enjoys an impeccable track record in India as
well as in international markets. Since its inception in 1977, the Corporation has maintained a
consistent and healthy growth in its operations to remain the market leader in mortgages. Its
outstanding loan portfolio covers well over a million dwelling units. HDFC has developed significant
expertise in retail mortgage loans to different market segments and also has a large corporate client
base for its housing related credit facilities. With its experience in the financial markets, strong market
reputation, large shareholder base and unique consumer franchise, HDFC was ideally positioned to
promote a bank in the Indian environment.
CAPITAL STRUCTURE
As on March 31, 2014 the authorized share capital of the Bank is Rs. 550 crore. The paid-up capital as
on the said date is Rs 479,81,00,870/- (2399050435 equity shares of Rs. 2/- each). The HDFC Group
holds 22.64 % of the Bank's equity and about 16.97 % of the equity is held by the ADS / GDR
Depositories (in respect of the bank's American Depository Shares (ADS) and Global Depository
Receipts (GDR) Issues). 34.11 % of the equity is held by Foreign Institutional Investors (FIIs) and the
Bank has 4,22,314 shareholders.
CBoP & TIMES BANK AMALGAMATION

On May 23, 2008, the amalgamation of Centurion Bank of Punjab with HDFC Bank was formally
approved by Reserve Bank of India to complete the statutory and regulatory approval process. As per
the scheme of amalgamation, shareholders of CBoP received 1 share of HDFC Bank for every 29
shares of CBoP. The amalgamation added significant value to HDFC Bank in terms of increased branch
network, geographic reach, and customer base, and a bigger pool of skilled manpower.
DISTRIBUTION NETWORK
HDFC Bank is headquartered in Mumbai. As of March 31, 2014, the Banks distribution network was
at 3,403 branches in 2,171 cities. All branches are linked on an online real-time basis. Customers in
over 1397 locations are also serviced through Telephone Banking. The Bank also has a network of
11,256 ATMs across India. HDFC Banks ATM network can be accessed by all domestic and
international Visa / MasterCard, Visa Electron / Maestro, Plus / Cirrus and American Express Credit /
Charge cardholders.
TECHNOLOGY
HDFC Bank operates in a highly automated environment in terms of information technology and
communication systems. All the banks branches have online connectivity, which enables the bank to
offer speedy funds transfer facilities to its customers. Multi-branch access is also provided to retail
customers through the branch network and Automated Teller Machines (ATMs).The Bank has made
substantial efforts and investments in acquiring the best technology available internationally, to build
the infrastructure for a world class bank. In terms of core banking software, the Corporate Banking
business is supported by Flexcube, while the Retail Banking business by Finware, both from i-flex
Solutions Ltd. The systems are open, scaleable and web-enabled. In each of its businesses, the Bank
has succeeded in leveraging its market position, expertise and technology to create a competitive
advantage and build market share.
MANAGEMENT
Mr. C.M. Vasudev has been appointed as the Chairman of the Bank with effect from 6th July 2010. A
retired IAS officer, Mr. Vasudev has been a Director of the Bank since October 2006. He has held
several key positions in India and overseas, including Finance Secretary, Government of India,
Executive Director, World Bank and Government nominee on the Boards of many companies in the
financial sector. The Managing Director, Mr. Aditya Puri, has been a professional banker for over 25
years. Given the professional expertise of the management team and the overall focus on recruiting and
retaining the best talent in the industry, the bank believes that its people are a significant competitive
strength.
BUSINESSES
HDFC Bank caters to a wide range of banking services covering commercial and investment banking
on the wholesale side and transactional / branch banking on the retail side. The bank has three key
business segments:
(i) Wholesale Banking- The Banks target market is primarily large, blue-chip manufacturing
companies in the Indian corporate sector and to a lesser extent, small & mid-sized corporates and agribased businesses. For these customers, the Bank provides a wide range of commercial and transactional
banking services, including working capital finance, trade services, transactional services, cash
management, etc. The bank is also a leading provider of structured solutions, which combine cash
management services with vendor and distributor finance for facilitating superior supply chain
management for its corporate customers. Based on its superior product delivery / service levels and
strong customer orientation, the Bank has made significant inroads into the banking consortia of a
number of leading Indian corporates including multinationals, companies from the domestic business
houses and prime public sector companies. It is recognised as a leading provider of cash management
and transactional banking solutions to corporate customers, mutual funds, stock exchange members and
banks.
(ii) Treasury-Within this business, the bank has three main product areas - Foreign Exchange and
Derivatives, Local Currency Money Market & Debt Securities, and Equities. With the liberalisation of
the financial markets in India, corporates need more sophisticated risk management information, advice
and product structures. These and fine pricing on various treasury products are provided through the
banks Treasury team. To comply with statutory reserve requirements, the bank is required to hold 25%
of its deposits in government securities. The Treasury business is responsible for managing the returns
and market risk on this investment portfolio.
(iii) Retail Banking- The objective of the Retail Bank is to provide its target market customers a full
range of financial products and banking services, giving the customer a one-stop window for all his/her
banking requirements. The products are backed by world-class service and delivered to customers
through the growing branch network, as well as through alternative delivery channels like ATMs,
Phone Banking, NetBanking and Mobile Banking. The HDFC Bank Preferred program for high net
worth individuals, the HDFC Bank Plus and the Investment Advisory Services programs have been
designed keeping in mind needs of customers who seek distinct financial solutions, information and
advice on various investment avenues. The Bank also has a wide array of retail loan products including
Auto Loans, Loans against marketable securities, Personal Loans and Loans for Two-wheelers. It is
also a leading provider of Depository Participant (DP) services for retail customers, providing
customers the facility to hold their investments in electronic form. HDFC Bank was the first bank in
India to launch an International Debit Card in association with VISA (VISA Electron) and issues the
MasterCard Maestro debit card as well. The Bank launched its credit card business in late 2001. The
Bank is well positioned as a leader in various net based B2C opportunities including a wide range of
internet banking services for Fixed Deposits, Loans, Bill Payments, etc.
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RATINGS
Credit Rating
HDFC Bank has its deposit programmes rated by two rating agencies - Credit Analysis &
Research Limited. (CARE) and Fitch Ratings India Private Limited. The bank's Fixed
Deposit programme has been rated 'CARE AAA (FD)' [Triple A] by CARE, which
represents instruments considered to be "of the best quality, carrying negligible
investment risk".
HDFC Bank also has its long term unsecured, subordinated (Tier II) Bonds of Rs.4
billion rated by CARE and Fitch Ratings India Private Limited. CARE has assigned the
rating of "CARE AAA" for the Tier II Bonds while Fitch Ratings India Pvt. Ltd. has
assigned the rating "AAA (ind)" with the outlook on the rating as "stable". In each of the
cases referred to above, the ratings awarded were the highest assigned by the rating
agency for those instruments.
AWARDS & ACHIEVEMENTS - BANKING SERVICES
Mr
Paresh
Managing
Sukthankar,
Director,
HDFC
Deputy
Bank
accepting the D&B Corporate Award
2014
HDFC Bank began operations in 1995 with a simple mission: to be a "World-class Indian Bank". We
realised that only a single-minded focus on product quality and service excellence would help us get
there. Today, we are proud to say that we are well on our way towards that goal.
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2014
Dun & Bradstreet - Manappuram Finance
Limited Corporate Award 2014
Best Corporate in Banking Sector
2013
Businessworld
Business Standard
Best Bank in India (Large Banks)

Mr Aditya Puri - Banker of the Year
2013
Business India
Best Bank 2013
Global Finance Survey -World's Best
Best Bank in India
Banks 2013
IBA Innovation Awards
Most Innovative use of Technology
Forbes Asia
Fab 50 Companies List for the 7th year
Figure 4 :- Milestones in the history
ORGANIZATION STRUCTURE AND ORGANIZATION HIERARCHY :

The organization structure of the company is headed by the administrative department which
coordinates and controls the executive department. The executive department is a link from the top and
the bottom comprising of the lower level employees such that they work together to fulfill the common
objective of getting business from the persons who get in touch with them and see to it that they are
provided with the best of the BANK which constitute giving financial advise to providing Account to
the customers. The lower level employees and the corporate financial consultants work together to see
to it that the database for providing financial BANK to sufficient number of people is made.
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Each team lead has a team comprising only of both senior as well as junior market research analyst
who aid the team lead in the entire market research process as it has been discussed previously. This is
the basic organizational structure followed by HDFC BANK.
Ma
na
gin
g
Dir
ectHead
Group
or
(Regional
Branch
Banking)
Figure 5 :-
Regional Head/ Branch

Banking Head
Circle Head/ Zonal Head
Cluster Head
Branch Manager
ABM, PB Sales, PB Welcome Desk, PB Authorizer, Tellers, Teller
Authorizer, Head RMs, RMs
Organizational Hierarchy
PRODUCT AND SERVICE PROFILE OF THE ORGANIZATION :HDFC Bank offers a bunch of products and services to meet the every need of the people. The
company cares for both, individuals as well as corporate and small and medium enterprises. For
individuals, the company has a range of accounts, investment, and pension scheme, different types of
loans and cards that assist the customers. The customers can choose the suitable one from a range of
products which will suit their life-stage and needs. For organizations the company has a host of
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customized solutions that range from Funded services, Non-funded services, Value addition services,
Mutual fund etc. These affordable plans apart from providing long
term value to the employees help in enhancing Goodwill of the company. The products of the company
are categorized into various sections which are as follows:
Personal Banking
Salary Accounts
Saving Accounts
Fixed Deposits
Demat Account
Safe Deposit Lockers
Loans
Credit Cards
Debit Cards
Prepaid Cards
Investments & Insurance
Forex Services
Payment Services
NetBanking
InstaAlerts
MobileBanking
InstaQuery
ATM
PhoneBanking
NRI Banking
Rupee Savings Accounts
Rupee Saving Accounts
Rupee Fixed Deposits
Foreign Currency Deposits
Accounts for Returning Indians
Quick remit (North America, UK,

Europe, Southeast Asia)
India Link (Middle East, Africa)
Coequal Lock Box
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Figure 6 :- Products & Services of the bank
Chapter 3:
STRATEGIC MANAGEMENT PROCESS (SMP)
Definition :
It is the full set of commitments, decisions and actions required for a firm to achieve strategic
competitiveness and above average returns.
Strategic competitiveness: when a firm successfully formulates and implements a value creating
strategy
Above average Returns: Returns in excess of what an investor expects to earn from other
investments with a similar amount of risk
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Figure 7 :- Strategic Management Process
Chapter 4:
VISION, MISSION & BUSINESS FOCUS
3.1. HDFC GOALS
1.
2.
3.
4.
5.
Develop close relationships with individual households.

Maintain our position as the premier housing finance institution in the country.
Transform ideas into viable and creative solutions.
To grow through diversification by gaining leverage from our existing client
base.
To nurture the values and ethos of Brand HDFC through all its Subsidiaries and Associate
Companies.
3.2. VISION STATEMENT OF HDFC BANK

To build a World-Class Indian Bank.
By offering a wide variety of relevant products and services
1)
2)
3)
4)
Tailored solutions for customers

Ensure Unmatched customer service
Providing the solution at right price
Have wide and extensive reach
The delivery backbone for providing the above shall be by adopting world class technology.
3.3. MISSION STATEMENT OF HDFC BANK
Our mission is to be "a World Class Indian Bank", benchmarking ourselves against international
standards and best practices in terms of product offerings, technology, service levels, risk management
and audit & compliance. The objective is to build sound customer franchises across distinct businesses
so as to be a preferred provider of banking services for target retail and wholesale customer segments,
and to achieve a healthy growth in profitability, consistent with the Bank's risk appetite. We are
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committed to do this while ensuring the highest levels of ethical standards, professional integrity,
corporate governance and regulatory compliance.
3.4. BUSINESS FOCUS
HDFC Banks mission is to be a World Class Indian Bank. The objective is to build sound customer
franchises across distinct businesses so as to be the preferred provider of banking services for target
retail and wholesale customer segments, and to achieve healthy growth in profitability, consistent with
the banks risk appetite. The bank is committed to maintain the highest level of ethical standards,
professional integrity, corporate governance and regulatory compliance. HDFC Banks business
philosophy is based on five core values: Operational Excellence, Customer Focus, Product Leadership,
People and Sustainability.
3.5. BUSINESS PHILOSOPHY
HDFC Bank is a young and dynamic bank, with a youthful and enthusiastic team determined to
accomplish the vision of becoming a world-class Indian bank.
Our business philosophy is based on five core values - Customer Focus, Operational Excellence,
Product Leadership, People and Sustainability. We believe that the ultimate identity and success of
our bank will reside in the exceptional quality of our people and their extraordinary efforts. For this
reason, we are committed to hiring, developing, motivating and retaining the best people in the
industry.
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Chapter 5:
ENVIRONMENTAL ANALYSIS
Definition :
Environment refers to all external forces which have a bearing on the functioning of business.
Environment are largely if not totally external, and beyond the control of individual industrial
enterprises and their management. These are essentially the givers within which firms and their
managements must operate in a specific country and they vary, from country to country.
BUSINESS ENVIRONMENT
Macro Environment
Micro Environment
Internal Environment
Financ iers
Suppliers
C ustomers
C ompetitors
Public
Mktg Intermediaries
Mission / Objectives
Management Structure
Internal Power Relationship
Physic al Assets & fac ilities
Business
Decision
C ompany image
Human resourc es
Financial C apabilities
Technological C apabilities
Marketing C apabilities
Ec onomic
Tec hnologic al
Global
Demographic
Socio-C ultural
Political
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Figure 8 :- Environment analysis
Chapter 6:
INTERNAL ENVIRONMENTAL ANALYSIS
Any business has certain vision, mission and objectives and a strategy to achieve them. Formulation of
strategy is defined as establishing a proper firm-environment fit. Indeed the objectives should be based
on an assessment of the external environment and the organizational factors (internal environment).
Vision
Mission
Objectives
Management Structure
Human Resources
Financial Factors
Company Image and Brand Equity
Internal anaylsis tools used

(i)
(ii)
SWOT ANAYLSIS
BCG MATRIX
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(i) SWOT ANALYSIS OF HDFC BANK

Strengths
HDFC bank is the second largest private banking sector in India having 2,201 branches and
7,110 ATMs
HDFC bank is located in 1,174 cities in India and has more than 800 locations to serve
customers through Telephone banking

The banks ATM card is compatible with all domestic and international Visa/Master card, Visa
Electron/ Maestro, Plus/cirus and American Express. This is one reason for HDFC cards to be
the most preferred card for shopping and online transactions

HDFC bank has the high degree of customer satisfaction when compared to other private banks
The attrition rate in HDFC is low and it is one of the best places to work in private banking
sector
HDFC has lots of awards and recognition, it has received Best Bank award from various
financial rating institutions like Dun and Bradstreet, Financial express, Euro money awards for
excellence, Finance Asia country awards etc

HDFC has good financial advisors in terms of guiding customers towards right investments
Weaknesses
HDFC bank doesnt have strong presence in Rural areas, where as ICICI bank its direct
competitor is expanding in rural market
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HDFC cannot enjoy first mover advantage in rural areas. Rural people are hard core loyals in
terms of banking services.
HDFC lacks in aggressive marketing strategies like ICICI
The bank focuses mostly on high end clients
Some of the banks product categories lack in performance and doesnt have reach in the market
The share prices of HDFC are often fluctuating causing uncertainty for the investors
Opportunities
HDFC bank has better asset quality parameters over government banks, hence the profit growth
is likely to increase
The companies in large and SME are growing at very fast pace. HDFC has good reputation in
terms of maintaining corporate salary accounts
HDFC bank has improved its bad debts portfolio and the recovery of bad debts are high when
compared to government banks
HDFC has very good opportunities in abroad
Greater scope for acquisitions and strategic alliances due to strong financial position
Threats
HDFCs nonperforming assets (NPA) increased from 0.18 % to 0.20%. Though it is a slight
variation its not a good sign for the financial health of the bank
The non banking financial companies and new age banks are increasing in India
The HDFC is not able to expand its market share as ICICI imposes major threat
The government banks are trying to modernize to compete with private banks
RBI has opened up to 74% for foreign banks to invest in Indian market.
STRENGTHS
2nd largest private sector bank

Approx. 3400 branches and 11250
ATMs across country
Employee friendly organization-lower
attrition rates as compared to other
competitors
Customer friendly approach
Sound financial advisors for investment
clients
Adoption of latest technology for bank
softwares and net banking facilities
Low minimum balance in savings
account
WEAKNESSES
OPPORTUNITIES
Scope in rural market

Steady customer oriented approach to
drive business in future
Corporate accounts, especially of the
growing SME sector
Operations abroad scope in countries
like Bangladesh, UAE and Sri Lanka
Greater scope for acquisitions and
strategic alliances due to strong
financial position
Improvement in bad debt recovery
strategies
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1
Low presence in rural areas as

compared to most of its top
competitors
Lack of aggressive marketing
strategies in comparison to other
banks
Heavy focus on mid and high level
clients
Not all the verticals of the bank are
performing successfully
Unstable share prices
THREATS
Increasing percentage if NonPerforming assets of the company

Major competition threat from banks
like ICICI, HSBC, AXIS and SBI
Increasing number of NBFCs and
new age banks
Attractive interest rates provided by
PSU banks in comparison to private
banks
Shifting consumer base from private
players to PSU due to modernization
of PSUs
RBI has opened up to 74% for foreign
banks to invest in Indian market
SWOT ANAYLSIS OF HDFC BANK
HELPFUL
HARMFUL
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Figure 9 :- SWOT Analysis of the bank
(ii) BCG MATRIX

The BCG matrix is a chart that had been created by Bruce Henderson for the Boston Consulting
Group in 1970 to help corporations with analyzing their business units or product lines. This helps the
company allocate resources and is used as an analytical tool in brand marketing, product management,
strategic management, and portfolio analysis.
HDFC Bank
HDFC BANK stands at star position in BCG matrix. As HDFC bank have the high market growth and
they also have high market share. There is a lot of growth potential for the banking industry because of
increasing disposable income of customers, increasing working class, more volatility in other markets
also increasing importance of savings and already discussed almost 30% of the market is still untapped.
2
3
HDFC Insurances
In insurance sector HDFCs most of the products are in star position. HDFC insurance products have
high market share and high growth rate. So we have lot of opportunity for investment.
HDFC Mutual Funds
Mutual fund stands at cash cow. This shows that HDFC high market share and low market growth rate
in mutual funds. This means we should only focus on profitable products and try to investment on those
products which are low market growth rate but perform well if proper investment is theirs.
Growth and margins
Having the funds to grow is only half the problem. However, will the company actually grow? The
sluggish rate of growth in the economy suggests that growth could indeed pose a problem. In fact, in
the first quarter of the financial year-ended 2009, HDFC Bank was able to record only a 43 per
cent growth in profits. This, however, may not be good enough to justify the valuation commanded by
the stock. And if, due to the slowdown, the bank is forced to invest in government securities rather than
in loans, which generate higher returns, the margins will be affected. On the other hand, competition
from other banks may increase. Hence it can be concluded that HDFC BANK stands at cash cow in
BCG matrix.
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Figure
10 :- BCG Matrix
Chapter 7:
EXTERNAL ENVIRONMENTAL ANALYSIS
PESTEL ANAYLSIS
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5
Political
factors:
Governme
nt
regulations: Banks as a financial body are always restricted with policies and rules.
The RBI closely governs the banks and other financial institutions and budgets made by the
government affects the banking activities and also its business to a certain extent.
Governments support to the PSU banks has an impact on the performance of other private players.
RBI is going to allow foreign banks to invest upto 74% into the Indian market.
Economic factors:
Every year, the changes in monetary policy affect the workings of the bank. The decisions on
the monetary policy impact the interest rates at which banks lend money.
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In the last 2 years RBI has modified its monetary rates 13 times to curb inflation and other
financial risks related.

Banking sector has played a major role in the increasing GDP of the country, thereby providing
its support to strengthen the economy.

Robust economic policies by the regulatory body helped Indian banks survive the severe
meltdown of 2009.
Social factors:
The life style of Indians consumers is rapidly changing and the buying power has also grown by
leaps and bounds

The rural market is expanding rapidly too. The concept of banking has slowly begun to sink in
the minds of the rural population and is making an impact on the lives of the rural population
and also on the banks operating in rural areas.

Illiteracy is still an issue that India is fighting with and therefore not many can read and
understand the terms of banks, thereby making them keep distance from banks.
Technological factors:
Banks have a wide network of ATMs lately.

Automated voice responsive machines help bank tackle small queries of customers.
Improved net banking and Mobile facility provided by banks has helped many customers save
time, money and also unnecessary hassles.

Internet banking or banking via the Internet can be considered
remarkable development in the banking sector. The ability to
carry out
banking transactions through the Internet has empowered
customers
to execute their financial transactions within the comfort of
their
homes and offices.
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Environmental factors:
HDFC Bank Joins The Anti-Plastic Drive

One of India's leading banks- HDFC Bank, is partnering with the city's municipal authorities to
educate people about the danger posed by plastic bags to the environment, and to offer recycled
paper bags instead.

The bank reinforced the Kolkata Municipal Corporation (KMC) initiated anti-plastic awareness
drive by distributing recycled and eco-friendly paper bags to retailers and customers across nine
markets in the city.

The initiative christened "Be Independent of Plastic on Independence Day" is undertaken by the
bank to encourage people to proactively get rid of plastic bags and use eco-friendly recycled
paper bags.
HDFC bank urges its customers to use the internet to transact with them especially in case of
Mutual Funds by using HDFCMF Online slogan being.

With HDFCMC Online you will help save a lot of paper and we encourage you to choose this
eco-friendly mode of transacting. We hope you will help us in our endeavor to protect our
environment and help us SAVE PAPER, SAVE TREES.
Legal factors:
Initiating appropriate legal proceedings as per Collections requirement and helping Collections
in meeting numbers and deadlines. Within the TAT prescribed for each process.
Effective vendor management including clearance of bills without delay. Within 3 days of
receipt of bills, bills to be forwarded to respective departments.
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Overseeing and reviewing legal managers of the area by conducting periodical reviews and
ensuring that process adopted is in line with policy and requirements. (Not quantifiable)
Maintaining MIS of the area and providing it to higher ups within TAT. (Not quantifiable)
Handling the claims raised against the bank effectively before all forums/ statutory bodies and
ensuring that no adverse orders are passed against the bank. (Not quantifiable)
Chapter 8:
THE INDUSTRY ANALYSIS
Industry Structure (Using Porters five forces model)

Porters five forces analysis is a framework for industry analysis and business strategy development
formed by Michael E. Porter of Harvard Business School in 1979. It draws upon industrial organization
(IO) economics to derive five forces that determine the competitive intensity and therefore,
attractiveness of a market.
2
9
An "unattractive" industry is one in which the combination of these five forces acts to drive down
overall profitability. A very unattractive industry would be one approaching "pure competition", in
which available profits for all firms are driven to normal profit.
Porters model is, applied microeconomic principles to business strategy and analyzed the strategic
requirements of industrial sectors, not just specific companies. The five forces are competitive factors
which determine industry competition and include: suppliers, rivalry within an industry, substitute
products, customers or buyers, and new entrants.
Banking is mainly a client oriented business. A high-quality of services to the client is crucial for the
growth and stability of any bank. A wider distribution and access of financial services helps both
consumers and producers to raise their
welfare and productivity. Such access is especially powerful for the poor as it provides them
opportunities to build savings, make investments, avail credit, and more important, insure themselves
against income shocks and emergencies.
To survive in an increasingly competitive environment, bank need to come up with various facilities
like Internet banking, mobile banking etc. With the onset of mobile banking, the industry finds itself at
the threshold of the next major technological leap.
30
i.
Bargaining power of Buyers Moderate bargaining power of customers on account of banks renders uniform services to the
clients. Now a days almost all banks would like to provide requisite information very easily by
way to Internet, Mobile banking to the clients
ii.
Bargaining power of Suppliers - Low bargaining power of suppliers on account of RBI

regulatory benchmarks. Banks have to meet numerous regulatory standards created by RBI
iii.
Competitive Rivalry - High competition of account of number of prominent public, private,

foreign along with cooperative banks.
Top Performing Public Sector Banks
a. Andhra Bank
b. Allahabad Bank
c. Punjab National Bank
iv.
Top Performing Private Sector Banks

a. ICICI Bank
b. AXIS Bank
c. Kotak Mahindra Bank
Availability of Substitutes - High menace from substitutes like NBFCs, Mutual funds,
Government securities and T-bills.
v.
3
1
Threat of new entrants - Low threat of new entrants on account of banking regulations. Before
setting up of a new bank, it is essential to take the consent of RBI.
Figure 11 :- Porters 5 Force Model
32
Chapter 9:
THE COMPETITORS ANALYSIS
Major Players in India :
1. HDFC BANK LTD
2. ICICI BANK LTD
3. STATE BANK OF INDIA LTD
4. PUNJAB NATIONAL BANK LTD
5. BANK OF BARODA LTD
6. FEDERAL BANK LTD
7. AXIS BANK LTD
8. ING VYSYA BANK LTD
9. IDBI BANK LTD
10. INDUSIND BANK LTD
11. YES BANK LTD
HDFC Bank is the second largest private bank in the country, the first being ICICI Bank.
A table stating the comparative analysis is given below :
Parameter
Revenue
Profit
Total assets
Employees
Branches
ATM
International presence
Significant M&A
ICICI Bank
13.9 bn $
1.4 bn $
120 bn $
79978
2630
8003
19 countries
Merger with Madura
in 2001
Attractive offering
DD call and collect

facility
Minimum balance in
Metro cities
Minimum balance in
Semi-urban
Rate applicable on
savings account
10000
10000
5000
500
3.5% on savings
account payable
every quarter
8.50%
3.5% on savings
account payable
every half year
9.25%
9.25%
9.50%
enterprise banking
accounts
branches, ATM,
Internet banking,
Mobile banking,
special campus
accounts for students
SME Lending
FD Rates-15 lacs capGeneral

FD Rates-15 lacs capsenior citizens
Enterprise stronghold
Distribution
Student offers
HDFC Bank
5.9 bn $
923 mn $
66 bn $
55752
2544
9709
5 countries
Acquisition of
Century Bank of
Punjab in 2008
Concessional rates
on savings account
for women
customers
branches, ATM,
Internet banking,
Mobile banking,
zero balance
accounts for students
and minors
3
3
COMPETITION
ANALYSIS : HDFC
BANK VS ICICI
BANK
34
Figure 12 :- Competitive analysis
COMPETITIVE SWOT ANALYSIS :
O
P
P
O
R
T
U
N
I
T
I
E
S
STRENGTHS
WEAKNESSES
S-O Strategies
W-O Strategies
Strength : Large Capital Base.
Opportunity : Market
Expansion.
Strategy : Deep penetration into

the Rural market.
Weakness : Workforce
Responsiveness.
Opportunity : Outsourcing of
Non-core Business.
Strategy : Outsource Customer
Care & other E-helps.
S-T Strategies
T
H
R
E
A
T
S
Strength : Low operating costs.
Threat : Increased competition

from other private banks.
Strategy : Steps to ensure

Loyalty by old Customers.
W-T Strategies
Weakness : Not equal to
International Standards.
Threat : Entry of many Foreign

Banks.
Strategy : Consider additional

benefits
3
5
Figure 13 :- Competitive SWOT analysis

DETAILED ANALYSIS
i. Strength-Opportunity Analysis (S-O Strategy) :
Strength:
It is well know that HDFC Bank has the largest Authorised Capital Base in the Banking System in
India i.e. having a total capacity to raise Rs.19,000,000,000 (Non Premium Value).
Opportunity:
Seeing
the
present
financial
&
economic
development
of
Indian
Economy and
also
the tremendous growth of the Indian Companies including the acquisition spree followed by them, it
clearly
states
the
expanding
market
for
finance
requirements
and
also the
growth in
surplus disposal income of Indian citizens has given a huge rise in savings deposits from the
above point it is clear that there is a huge market expansion possible in banking sector in India.
Strategy:
From the analysis of Strength & Opportunity the simple and straight possible strategy
for HDFC Bank could be - to penetrate into the rural sector of India for expanding its market share as
well as leading all other Pvt. Banks from a great gap.
ii. Strength - Threat Analysis (S-T Strategy) :
Strength
36
HDFC Bank is not only known for large capital but also for having a low operations cost though
having huge number of branches and services provided.
Threat:
After showing a significant growth overall, India is able to attract many international financial &
banking institutes, which are known for their state of art working and keeping low operation costs.
Strategy:
To ensure that HDFC Bank keeps going on with low operation cost & have continuous business
it should simply promote itself well & provide quality service so as to ensure customer loyalty,
therefore guaranteeing continuous business.
iii. Weakness - Opportunity Analysis (W-O Strategy) :
Weakness :
It is well known that workforce responsiveness in banking sector is very low in Indian
banking sector, though HDFC Bank has better responsible staff but it still lacks behind its counterparts
like HSBC, HDFC BANK, CITI BANK, YES BANK etc.
Opportunity :
In the present world, India is preferred one of the best places for outsourcing of business process works
and many more.
Strategy :
As international companies are reaping huge benefits after outsourcing their customer care & BPOs,
this
same
strategy
should
be
implemented
by
HDFC
proper customer service without hindering customer expectations.
iv. Weakness - Threat Analysis (W-T Strategy) :
bank
so
as
to
have
3
7
Weakness :
Though having an international presence, HDFC Bank has not been able to keep up the
international standards in providing customer service as well as banking works.
Threat :
In recent times,India has witnessed entry of many international banks like CITI Bank,
YES Bank etc. which poses an external entrant threat to HDFC Bank as these Banks are known for
their art of working and maintain high standards of customer service.
Strategy :
After having
new
entrants
threat
, HDFC Bank should come
up with
more
additional
benefits to its customers or may be even reduce some fees for any additional works of customers.
Chapter 10:
FINANCIAL RESOURCES & CORE COMPETENCIES
4.1. FINANCIAL RESOURCES :
38
3
9
Figure 14 :- Financial Statements for the year ending 31st March, 2014
4.2. CORE VALUES
The Banks five core values are :
(i) Customer Focus

To achieve sustainable competitive advantage, HDFC Bank relies not only on strong customer service,
but also on measuring customer experience. The Bank has invested in CRM Technology which
provides triggers for selling various products depending
on the customer profile. The Relationship Manager is a trusted advisor to the customer he/she has the
best interest of the customer and can advise competitor products, if the Banks product does not fit the
customer needs.
(ii) Operational Excellence
With a dedicated team to monitor quality and service standards, many of HDFC Banks process
segments, including HR Operations are ISO certified. Over 2200 quality improvement projects, aimed
at improving operational excellence have been successfully implemented. Over 550 employees have
qualified for Six Sigma Certification and over 80 have earned the yellow belt
40
(iii) Product Leadership

HDFC Bank has consistently developed innovative products and services that attract its targeted
customers. Focusing on high earnings growth and low volatility, HDFC Bank continues to develop and
distribute products/services that reduce cost of funds, by leveraging its extensive branch network. The
Bank actively tracks the performance of various products and depending on the feedback received,
tweaks product features, to better address customer needs.
(iv) Sustainability
We recognize Social and Environmental aspects as essential elements of a Sustainable business
philosophy and are committed to enhance our performance on these fronts. It is an endeavor to drive a
paradigm shift of viewing ESG (Environmental, Social and Governance) parameters from risks to
opportunities and to incorporate social and environmental aspects into our business by embedding
sustainability in our Stakeholders, Products and Services.
(v) People
People are the Banks greatest strength. HDFC Bank believes that the ultimate identity of success of
our Bank will reside in the exceptional quality of our people and their extraordinary efforts. For this
reason, we are committed to hiring, developing, motivating and retaining best people in the industry.
The People Value can be defined, as
Professional : Transparency, fairness, absolute integrity and unbiased dealings with

stakeholders customers, colleagues and vendors. People are not afraid to experiment as long
as there is a convincing business logic and an honest attempt.
Respect for the Individual : Absolute meritocracy at the time of hiring or promoting individual
or assigning tasks and positions. There is a formal sexual harassment policy in place to ensure
dignity of individuals in the workplace.
4
1
Can Do Attitude : The attitude to take oneself beyond ones perceived limitations emphasizes
on persistence and perseverance in reaching ones goals.
Employee Care : HDFC Bank cares for its employees. This is manifested in the fact that Bank
has instituted a Reward and Recognition Policy to acknowledge and honour employee
contribution, be it business, cost saving initiatives or process improvements.
4.3. BUSINESS DIVISION :
Retail banking - Loans to Individuals (Auto

loan, Housing Loan, Education Loan and
other personal loan) or small businesses.
Wholesale banking Loans to Mid and

Large corporate (Working Capital loans,
Project finance, Term loans, Lease Finance)
Treasury Operations Investment in

Equity, Derivates, Commodities, Mutual
Funds, Bonds, Trading and Forex operations
Other Banking Businesses Merchant Banking, Leasing business, Hire purchase, Syndication
services etc.
42
Chapter 11:
STRATEGIC ANALYSIS
STRATEGY DEFINITION :
A strategy is an integrated and coordinated set of commitments and actions designed to exploit core
competencies and gain a competitive advantage.
A firm has a competitive advantage when it implements a strategy competitors are unable to duplicate
or find too costly to try to imitate.
4
3
A strategy is a comprehensive master plan stating HOW the corporation will achieve its mission and
objectives. There are three types:
Corporate - a corporations overall direction and the management of its businesses.

Business - emphasizes improving the competitive position of a corporations products or services in a
specific industry or market segment.

Functional - concerned with developing a distinctive competence to provide a company or business
unit with a competitive advantage.
Figure 15 :- Classification of Strategies
(A) CORPORATE LEVEL STRATEGY :-
44
(B) BUSINESS LEVEL STRATEGY :Our business strategy emphasizes the following :
Increase our market share in Indias expanding banking and financial
services industry by following a disciplined growth strategy focusing on
quality and not on quantity and delivering high quality customer service.
4
5
46
Leverage our technology platform and open scaleable systems to deliver

more products to more customers and to control operating costs.
Maintain our current high standards for asset quality through disciplined
credit risk management.
Develop innovative products and services that attract our targeted customers
and address inefficiencies in the Indian financial sector.
Continue to develop products and services that reduce our cost of funds.
Focus on high earnings growth with low volatility.
HDFC Banks General Business Strategy :
Customer retention strategy (may 2, 2008)
All charges have been waived off

Services like locker, de-mat, etc. would be charged at 50%.
The charges on debit card have been taken off.
Gave number to contact regarding any service.
(C) FUNCTIONAL LEVEL STRATEGY :Marketing strategy :
4
7
Segmentation strategy
Demographics variables
Location - Metros & divisional cities
Occupation - Business person & Salaried class (both govt. & private)
Age - Senior citizens & Minor
psychographic variables
Lifestyle - People who believes in modern banking with higher set of service i. e.
internet banking (incontact, mobile refill, travel currency card etc.)
Targeting strategy
Target market
Corporate banking market : this market target the industries & fulfill their financial
needs.
Capital market : this segment is targeted on the long term needs of the individual as
well as of industries.
Retail banking market : this segment is for retail investors & provide them short term
financial credit for their personal, house hold needs.
Positioning strategy
HDFC Bank has positioned itself as a bank which gives higher standard of services through
product innovation for the diverse need of individual & corporate clients. So they want to
highlight following points in their positioning segment :
-Customer centric
-Service oriented
-Product innovation
Promotions strategy of HDFC Bank

"It plans to send personalized mailers about various products to all those HDFC come in contact with
during these mass promotions." The bank has also tied up with Business Today, to sponsor 10,000
copies of the magazine in each metro. The cover of the sponsored copies would be the December issue
48
of Business Today, which rated HDFC Bank as the best bank in the country. On the opposite side,
would be an advertorial which would talk about HDFC as a `one-stop financial supermarket'.
Gold Credit card: For providing the better services to the customers and promoting their business,
HDFC has launched the Gold Credit Cards. It's overloaded with travel benefits - discounts, cash back
offers, air miles redemption.
Gold Credit Card Features & Benefits
Attractive Reward Points - Earn 1 reward point per Rs 150 spent on the Gold Credit Card.
Rewards points redemption - After earning all those reward points on your HDFC Bank Gold
Credit Card, redeem them for exciting gifts and services! You could even convert them to airline
miles with India's leading airlines through the My Rewards programme.
Worldwide acceptance - Accepted at over 23 million Merchant Establishments around the
world, including 110,000 Merchant Establishments in India.
Revolving credit facility - Pay a minimum amount, which is 5% (subject to a minimum amount
of Rs.200) of your total bill amount or any higher amount whichever is convenient and carry
forward the balance to a better financial month. For this facility you pay a nominal charge of just
3.25% per month (39.0% annually).
Free Add-on card - You can share these wonderful features with your loved ones too - we offer
the facility of an add-on card for your spouse, children or parents. Allow us to offer add-on cards
to you FREE OF COST with our compliments.
Interest free credit facility - Avail of up to 50 days of interest free period from the date of
purchase (subject to the submission of the charge by the Merchant).
Zero liability on lost card - If you happen to lose your Card, report it immediately to our 24hour call centre. After reporting the loss, you carry zero liability on any fraudulent transactions on
4
9
your card
Platinum Cards Get Additional Benefits

HDFC Bank Platinum Card Customers Get Additional Benefits compared to Gold / silver or other entry
level cards. For instance, consider this, HDFC Cards has a Co-Branded Online Shop with Surat
Diamonds. By virtue of being HDFC Bank Customer, you are already getting big discount. Now add
any item to your cart and enter 558818 [6 Starting Digits of Platinum Card], you get additional
discount. This is just one such instance. You also get Petrol Surcharge Waiver, IRCTC Charges Waived,
etc.
Clear Trip Discount to Debit Card Holders

Use your HDFC Bank Debit Card to book any flight, hotel or train & get 10%* cashback Domestic
Air Offer - Book any Domestic Flight and get 10% cash back on Base Fare or Rs.250 cash back per
booking
(whichever
is
less).
Trains - Book any Train and get 10% cash back or Rs.50 cash back per booking (whichever is less)
International Air Offer - Book any International Flight and get 10% cash back on Base Fare or Rs.600
cash back per booking (whichever is less). Hotels Offer - Book any Hotel (Domestic/International) and
get 10% cash back on Base Price or Rs.500 cash back per booking (whichever is less). To avail the cash
back kindly enter coupon code HDFCTRIP during step 3 of the booking process before payment.
HR STRATEGY :The Bank is a team focused organization that is characterized by
50
Collaborative relationships;
Approachable and open communications;
Courteous, efficient and effective services; and
Flexibility and fairness
PURPOSE
The purpose of this strategy is to ensure that the human resources values framework incorporates four
key principles, which are;
1. Communication
Banks management and staff will promote an environment where the principles of open
communication will be upheld. For the purpose of this policy ,open communication encapsulates the
idea of;
W
Mutual recognition an respect at all levels;
Freedom to express ones views and a commitment to resolving any interpersonal conflict;
W
W
W
Promotion and development of two way communication incorporating constructive

feedback;
Appropriate dissemination of dissemination of information.
2. Opportunity Banks management and staff will promote a work environment that provides
opportunity for;
Improved work practices;
Support of individuals in pursuit of personal and career growth and
Encouragement of self development by recognizing and using
individual strengths.
3. InnovationBanks management and staff will promote an envioronment to encourage initiative

leading to flexibility and growth. This philosophy will facilitate improved work practices , which meet
organizational needs through the challenging of preconceived ideas.
4. Individual
Banks management and staff acknowledge the importance of each individuals contribution to the
work of the Bank by recognizing their qualities , strengths and abilities and sharing these across the
Bank.
5
1
STRATEGIC QUALITY POLICY
SECURITY :
The bank provides long term financial security to their policy. The bank does this by offering
life insurance and pension products.
TRUST :
The bank appreciates the trust placed by their policy holders in the bank. Hence, it will aim to
manage their investments very carefully and live up to this trust.
INNOVATION :
Recognizing the different needs of our customers, the bank offers a range of innovative
products to meet these needs.
INTEGRITY:
CUSTOMER CENTRIC
PEOPLE CARE ONE FOR ALL AND ALL FOR ONE
TEAM WORK
JOY AND SIMPLICITY
Operation Red Spider
On 14 March 2013 an online magazine named Cobrapost.com released video footage

from Operation Red Spider showing high ranking officials and some employees of HDFC bank
willing to turn black money into white which is violation of Money Laundering Control Act
Following this the government of India and RBI have ordered an inquiry
The enquiry confirmed violation of KYC (Know Your Customer) norms by HDFC Bank. A
penalty of Rs 45 million was imposed on the bank by RBI
52
HR Department
HR Department is responsible for;
Regular review and development of human resource management practices;

Periodic review of the work priorities to determine skill requirements needed to
meet the Banks strategic plan;

Determination of an organizational structure that will facilitate and improve
teamwork; and
Appointment and promotion of staff on merit and to ensure that treatment of all
employees is fair and equitable.
The Organisational Competencies Required for ExcellentCustomer Service :

What customers want from HDFC Bank is expressed into some organizational competencies so that
you can see what you as Manager or Team Leader must achieve within your team. If customers
want excellent service, how does the organisation or team go about providing it? Developing and
Sustaining a Reputation for Service Excellence, identifies the Organisational Competenciesthat need to
be in place to deliver that excellent service. These organisational competencies have to be in place right
across the organisation. Although you can do a lot yourself with your own team, World Class Service
Excellencerelies on a commitment and drive from the very top of the organisation to build these
competencies. The competencies are described below.
Service Personality
The organisation has a well-defined personality which defines the particular way itdelivers service and
interacts with its customers. An excellent service provider tendsto have its own Service Personality an
identifiable set of service characteristics thatdefines how its service provision is different from that of
its competitors.
Service Culture
There
5
3
is
culture
throughout
the
organisations people that focuses on givingexcellent service o both internal and external customers.
Leaders and managers arecommitted to the service culture. They communicate the organisations
vision, values,leadership and continuous improvement methods to employees. Employees
understandtheir own role in supporting the service culture. An example is provided by a
large,multinational organisation that supplies food products to retail stores. It includescustomer service
in its mission statement, publishes its organizational valuesprominently on its website, and issues a
one-page Customer Service Credo to all itsemployees. It ensures that all its people have a clear
understanding of the importanceof customer service in all that they do.
Committed Staff
Employees are well-motivated, have a can-do attitude, enjoy team working andsupporting their internal
customers. Professional relationships exist throughout theorganisation, with high levels of trust,
openness and a no-blame culture, encouragingcontinuous improvement. An example is shown by an
organisation where teamsregularly have their own meetings to review customer service issues, talk
throughimprovements to processes and deal with customers problems. Each month they appoint an
Employee of the Month and the winners of the award are sometimespeople who deal only with
internal customers.
54
Customer Focused Processes

Systems and processes are designed around customers, whether internal or external. Six systems or
processes in particular are seen as fundamental: communication systems, systems for listening to
customers and employees, training systems, appraisal, reward and recognition systems, performance
measurement systems and service recovery systems. For example, at all sites of a European retailer
there are notice-boards to display up-to-date graphs showing customer satisfaction levels. This ties
employees and teams performances firmly to improvements for customers.
Easy To Do Business With
If the first four organisational competencies are in place, then they should lead toreally positive results
for customers they will find the organisation easy to dobusiness with.An example is provided by
guests at a prominent hotel group. The hotel finds that itwins and keeps many new customers because it
has ensured its online room bookingservice is highly customer focused and easy to use. Combined with
the excellentservice reported by customers when they stay at the hotel, this means theorganisation is
easy to do business with.
Financial Benefits
Once the organisational competencies are in place, your team and organisation canbuild a reputation
amongst its customers for service excellence. This in turn leads to Customer Loyalty, recommendation
and in general to financial success.
HR COMPETENCIES: Competency is an underlying characteristic of an employee (i.e. a motive, trait, skill, aspects of
ones self-image, social role, or a body of knowledge) which results in effective and/or superior
performance. (Prof. Boyatzis, 1982)
5
5
56
MANAGEMENT INFORMATION SYSTEM

A Management information system (MIS) is a subset of the overall internal control of a business
covering the application of people, documents, technologies, and procedures by management
accountants to solve business problems such as costing a product, service or a business-wide strategy.
MIS should be designed to achieve the following goals:
Enhance communication among employees.
Deliver complex material throughout the institution.
Provide an objective system for recording and aggregating information.
Reduce expenses related to labor-intensive manual activities.
Support the organization's strategic goals and direction
INFORMATION SYSTEM IN HDFC :
Information technology can be a strategic tool in making HDFC more efficient and effective.
HDFC can reach more people in more efficient way by implementing right management
5
7
information system. IT creates an evolution in whole world in every business and so in banking
system.
Due to IS employees can easily connect with other branches, customer service get improved,
online banking emerged and lot of others benefits
MAIN SERVICES:
Consumer Banking
Wholesale Banking
ORGANISATIONAL RESOURCES :
Application Software:General Application Software :
Microsoft Office
NOD32 Anti-Virus
Adobe Reader
Database management software
Integrated software : CLARIS , LOTUS
Specific Application Software :
HR software called ATLAS
Accounting software called TALLY
Marketing software called CALLPAN
58
Financial software called SPSS
Business India
B U S I N E S S
I N D I A
Sunday, 29 Nov 2009
Page# :130
Size : 503.82 sq.cm.
C o r p o r a te
N o v em b er 2 9 ,2 0 0 9
W o m a n
A p e o p l e 's p e r s o n
4
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s
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T h e H R h e a d o f H D F C B a n k d o esn 't let c o n tr o v er sy sto p h er

fr o m p er fo r m in g
T h a t d id n o t c o m e e a s y . T a k e L o rd
K r is h n a B a n k , fo r in s ta n c e , w h ic h w a s
m e r g e d in t o C e n t u r i o n B a n k , a l o n g
w i th
B a n k
o f
P u n j a b . T h e
K e ra la b a s e d b a n k h a d a u n i o n th a t o p p o s e d
its m e r g e r w ith C e n t u r i o n , a n d th e r e
w e r e b r a n c h e s t h a t h a d n 't s e r v ic e d a
s i n g l e c u s t o m e r in m o n t h s . W h e n it
c a m e to a p p e a s in g e m p lo y e e s in P u n
ja b , M a itr a (a P u n ja b i h e r s e lf) tr a v
e lle d t h e d is ta n c e a l o n e . T o a d d r e s s
e m p lo y e e s in K e ra la , s h e jo in e d m a n
a g in g d ir e c to r A d ity a P u ri, w h o a s k e d
t h e m fo r a g o o d d a y 's w o r k , fo r a g o o d
d a y 's p a y . L o o k in g b a c k , t h a t u n i o n
s till e x is ts . " B u t w e n e v e r h a d a p r o b
le m
w ith
it,"
s a y s
M a itr a .
"If
t h e
e m p lo y e e s
a r e
p e r f o r m i n g
th e ir
d u tie s , w h y
s h o u l d
t h e u n i o n b e a
p r o b l e m ? " s h e a s k s .
a n d e e p M a itr a , 4 4 , th e h e a d o f
h u m a n r e s o u r c e s ( H R ) a n d c o r
p o r a te s e rv ic e s a t p r iv a te s e c to r H D F C
B a n k , h a s b e e n t h r o u g h t w o m e r g e r s
a lr e a d y . F irst, w h ile a t T im e s
B a n k
in
1 9 9 9 ,
w h e r e
s h e
m o v e d
f r o m
c o n s u l t a n c y
firm
A r th u r
A n d e r s e n .
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H R ,
T im e s
w a s
a c q u i r e d
b y
H D F C
B a n k . A n d th e s e c o n d , m o r e re c e n tly ,
w h e n H D F C B a n k a c q u ir e d C e n tu r io n
B a n k o f P u n ja b - its e lf a c o m b i n a t i o n
o f s o rts , f o r m e d
b y
t h e
m e r g e r
o f
fo u r b a n k s .
A s s im ila tin g
t h e c u ltu r e s o f
tw o
o r g a n is a t io n s
t o g e th e r
c a n
b e
t h e
tr ic k ie s t e x e r c is e in a n y m e r g e r ; a n d
in th is a r e a , M a itr a , a
p s y c h o lo g is t
w h o " a lm o s t b e c a m e a s h r in k " , h a s
g a th e r e d
d e c e n t
e x p e r ie n c e .
S h e
b e g a n h e r c a r e e r a t a
m a n u f a c t u r i n g
o u tle t o f E ic h e r T r a c to r s a t P a r w a n o o
in F lim a c h a l P r a d e s h - f o llo w in g h e r
e d u c a tio n a t L a d y S r ir a m C o lle g e a n d
T a ta
I n s titu te
o f
S o c ia l
S c ie n c e s .
A t a g e
2 2 , s h e
w a s
t h e
o n ly
g irl
in m a n a g e m e n t in a f a c to ry
fu ll o f
u n i o n w o r k e r s .
la b
b e c
in g
k e e
b u t
a b o
t h e
n o t
" B a c k t h e n ," s h e re c a lls , " w e h a d

o u r
is s u e s
w ith
t h e
w o r k e r s ,
a u s e t h e y t h o u g h t w e w e r e p u s h
fo r p r o d u c t iv ity , in s te a d o f b e in g
n a b o u t t h e i r w e l f a r e . It s o r t e d o u t ,
th e s e e x p e r ie n c e s te a c h y o u a lo t
u t b a la n c i n g
d iff e re n t
id e a s . A t
e n d o f th e d a y , y o u b e t o n p e o p le ,
s tra te g ie s ."
A
m o v
A N Z
fo r t
t h e n
in
b
c o n s
fte r h e r s tin t a t E ic h e r ,
e d to M u m b a i w h e r e s h e
G r i n d l a y s B a n k - first r e s p
h e in v e s tm e n t b a n k i n g s e
m o v i n g o n t o t h e H R
f u
e t w e e n
h e r r o le s , s h e
s
id e r a b le a m o u n t o f t i m e
A s s im ila tin g th e
to g e th e r c a n b e
a n d in th is a r e a ,
b e c a m e a s h rin k
M a itr a
jo in e d
o n s ib le
g m e n t,
n c tio n ;
p e n t a
in t h e
M a i tr a :
c o n te n t b e i n g k i n g
m a ker
tr e a s u r y s e g m e n t to o . A N Z G r in d la y s
w a s t h e n a 5 6 - b r a n c h o p e r a t io n
w ith
3 ,0 0 0 e m p lo y e e s . T h is w a s
f o llo w e d
b y a s tin t a t A r th u r A n d e r s e n fo r th r e e
y e a rs , a s p a rt o f a c o r e
t e a m
th a t
lo o k e d
a fte r
H R in itia tiv e s
a c r o s s
E u r o p e , M id d le E a st a n d A sia .
A fte r
N a n i J h a v e r i
f r o m
A r th u r
A n d e r s e n
m o v e d
to
h e a d
T i m e s
B a n k , M a itr a j u m p e d
s h i p to o . B u t
w i t h i n
e ig h t
m o n t h s
o f
jo in in g ,
T im e s g o t m e r g e d in to H D F C : B a n k . "I
w o n d e r e d b a c k t h e n if I s h o u l d s t a y
o n ;
H D F C
B a n k
w a s
le s s e r
k n o w n
fo r its H R p o lic ie s a n d
s tr a te g ie s ."
B u t s h e d e c i d e d to ta k e t h e p lu n g e .
S in c e
t h e n ,
M a itr a
h a s
s e e n
t h e
b a n k g r o w f ro m
1 ,3 0 0 e m p l o y e e s t o
c u ltu r e s o f tw o o r g a n is a tio n s
th e tr ic k ie s t e x e r c is e in a n y m e r g e r ;
M a itr a , a p s y c h o lo g is t w h o " a lm o s t
" , h a s g a th e r e d d e c e n t e x p e rie n c e
8 ,0 0 0 , w i t h i n t h e s p a n o f a d e c a d e .
It
w a s
a
c o n s t a n t
p r o c e s s ,"
s h e
a y s , " a s w e w a n t e d e v e r y t h i n g t o fa ll
n to p la c e " .
T h e n e x t fe w m o n t h s w e r e s p e n t in
b r in g i n g to g e t h e r p e o p le , c u ltu r a lly
in te g r a t in g t h e m
a n d d e v is in g p a c k
a g e s
fo r
c o m p e n s a t i o n
a n d
p e r k s ,
a p a r t fr o m c le a r in g g r ie v a n c e s . T h e r e
w e r e re s id u a l iss u e s , id e o lo g ic a l d iffe r
e n c e s a n d
d u p l ic a t i o n
o f w o r k .
In
h i n d s i g h t , s h e s a y s , p u l l i n g i t o ff is
e a s ie r w h e n
o n e
is c l e a r a b o u t
th e
p o lic ie s . "I s h o u ld b e a b le to d e f e n d
t h e m
in
f ro n t
o f
a
h u g e
c r o w d ,
o th e r w i s e
t h e
p o lic y
is n o t
w o r t h
f o llo w in g ," s h e s a y s .
A s if H R w a s n o t e n o u g h ,
M a itr a
h a n d l e d c o r p o r a te s o c ia l r e s p o n s ib il
ity ( C S R ) fo r H D F C B a n k till s o m e t i m e
b a c k , a n d m o r e r e c e n tly , to o k o n h e r
p la te
th e
r o le o f d e v e l o p i n g
H D F C
B a n k 's
1 ,5 0 0
b r a n c h
in f r a s tr u c tu r e .
C S R , s h e s a y s , a llo w e d h e r to w o r k a t
t h e
g r a s s r o o ts
le v e l
in
e d u c a t i o n
a n d
liv e lih o o d
c r e a tio n
p r o je c ts .
" T a k in g c a re o f in f r a s tr u c tu r e e n ta ils a
lo t
o f
e n e r g y .
It r e q u i r e s
k e e p in g
c o s ts a t a m i n i m u m , b u t a t t h e s a m e
tim e ,
b r in g in g
t h e
b e s t
t h a t
is
o ff e re d ," s h e s a y s .
A p e o p le 's p e r s o n , fo r M a itr a c o n
te n t b e in g k in g m a k e r , r a th e r
t h a n
k in g . S h e c o u ld h a v e ta k e n a lin e jo b a
fe w y e a r s a g o , b u t H R r e m a i n s h e r firs t
p a s s i o n . " A n d it is g r e a t w h e n
y o u r
p e r s o n a l
p a s s io n
c a n
b e
b r o u g h t
a b o u t in y o u r jo b ," s h e a d d s .
V A
^ 1 2 8
I S
B A
L A
5
9
60
Chapter 12:
HR SCORECARD
In order to perform an overall analysis we need to analyze KPIs, i.e. those factors influencing
performance of HR department.
Cost per Hire. By evaluating this factor you will be able to see how expensive the recruiting process
is. This process starts from posting job offer to the moment when a new person is officially employed
in the company. Logically, the shorter this process is, the least expensive is cost per hire.
Turnover Cost. These are the costs related to termination, new hire and learning. In other words, these
are expenses related to integrating a new person into the company.
Turnover Rate. This value represents the situation in your company related to leaving and hiring new
employees. Many people would agree that it is not good to change personnel too often. If the turnover
rate is very high, then maybe you are treating your personnel wrong? Or is it something wrong with
your business in general? Find out.
Time to Fill. Basically, this is the time needed to fill a vacant position in the company. Of course, this
time depends on how well HR managers are working with
6
1
recruiters, advertising and people in general. The shorter this time, the better performance of your HR
department.
Length of Employment. This indicator is very easy to understand. It is possible to calculate an average
value. For instance, in average an employee works 5 years for your company. Of course, everything
depends on the position. If you are changing couriers or secretaries, this is not a big problem. But if
chief managers work for your company less than a year, this is definitely not good.
Training and Development. Even if you hire the best specialist you need to integrate him into your
company and train. Of course, you bear costs, related to training. If you manage to cut this cost without
harming quality of training, then your HR department is doing a great job.
Salaries, compensation, bonuses. It is very important to know that you are not overpaying and
allocating recourses wisely. This also concerns HR department of any company. With Balanced
Scorecard you will be able to see how effectively companys funds are being used in HR branch.
Cost Effectiveness. It all comes to cost effectiveness after all. All above-mentioned factors influence
performance of HR department which has one goal minimize costs and boost performance.
62
HDFC Bank uses Oracles balanced scorecard as a technique for evaluating the employees in the
organization.
Figure 16 :- HR Scorecard
6
3
64
6
5
Chapter 13:
CONCLUSION
HDFC Bank is among the top banks in the private sector domain. The bank boasts of a huge
amount of operational efficiencies for over the years. It has got a very good asset quality and
good coverage ratios. The bank has aggressively looked into rural areas and tier-V and tier-VI
cities.
With this prospect HDFC is continuously working in this direction, but there are several
competitors already in the market with the similar strategy. This concludes that with the
changing economical and political scenario in order to maintain the position HDFC needs to
follow some differentiating strategy. Because it has a very fine line of difference with its
competitor ICICI and can outshine HDFC.

The organization must align its corporate and HR strategy by using a holistic model concept.
There are no specific HR strategies followed by the organization. More emphasis towards such
strategy formulation must take place.

A communication lab can be setup to attain more clarity in authority-responsibility
relationships.
Proper training should be given to everyone about how to use the software efficiently.
Capacity within institution should be managed properly.
66
References
Mr. Rakesh Garg, Branch Manager, Hdfc Bank Ltd., SCF 69-70, Phase 3B2, Mohali
Verma, Anuj; Paper on Hdfc bank : A fundamental analysis
Book : Business Environment- By Aswathappa
Article - Business India Sunday, 29 Nov 2009
Available from: http://www.hdfcbank.com/personal/default.htm
Available from: http://www.wikipedia.org/
Available from: http://www.google.com/
Available from: http://www.marketing91.com/swot-analysis-hdfc/#sthash.BTthsnti.dpuf
Available from: http://www.moneycontrol.com
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Strategic Management Process

Strategic Management Process

Early phase from 1786 to 1969 of Indian Banks

Strategic Management Process

Figure 1 :- Structure of Banking System in India

1.2.3. Growth and present status of the industry

Strategic Management Process

Strategic Management Process

Figure 3 :- Challenges faced by the banking industry

Strategic Management Process

Strategic Management Process

CBoP & TIMES BANK AMALGAMATION

Strategic Management Process

Strategic Management Process

Strategic Management Process

AWARDS & ACHIEVEMENTS - BANKING SERVICES

accepting the D&B Corporate Award

Strategic Management Process

Best Corporate in Banking Sector

Best Bank in India (Large Banks)

ORGANIZATION STRUCTURE AND ORGANIZATION HIERARCHY :

Strategic Management Process

Regional Head/ Branch

Strategic Management Process

Safe Deposit Lockers

Investments & Insurance

Rupee Savings Accounts

Rupee Saving Accounts

Rupee Fixed Deposits

Foreign Currency Deposits

Accounts for Returning Indians

Quick remit (North America, UK,

India Link (Middle East, Africa)

Coequal Lock Box

Strategic Management Process

Figure 6 :- Products & Services of the bank

Strategic Management Process

Figure 7 :- Strategic Management Process

Develop close relationships with individual households.

3.2. VISION STATEMENT OF HDFC BANK

Tailored solutions for customers

Strategic Management Process

Strategic Management Process

Strategic Management Process

Figure 8 :- Environment analysis

Company Image and Brand Equity

Internal anaylsis tools used

Strategic Management Process

(i) SWOT ANALYSIS OF HDFC BANK

customers through Telephone banking

the most preferred card for shopping and online transactions

excellence, Finance Asia country awards etc

Strategic Management Process

HDFC lacks in aggressive marketing strategies like ICICI

The bank focuses mostly on high end clients

HDFC has very good opportunities in abroad

Strategic Management Process

2nd largest private sector bank

Scope in rural market

Low presence in rural areas as

Increasing percentage if NonPerforming assets of the company

SWOT ANAYLSIS OF HDFC BANK

Strategic Management Process