Rabo Bank Group Entering The Chinese Market Finance Essay - Free Essay Example

Sample details Pages: 6 Words: 1937 Downloads: 2 Date added: 2017/06/26 Category Finance Essay Type Argumentative essay Did you like this example? The main purpose of this report is to identify and appraise Rabobank Groups entry modes into the Chinese market. This report first gives a brief introduction of Rabobank Group, and then identifies its entry modes into the Chinese market. Through the analysis and appraisement of both advantages and disadvantages of its entry modes, this report offers several recommendations to further develop Rabobank Groups business in China. Don’t waste time! Our writers will create an original "Rabo Bank Group Entering The Chinese Market Finance Essay" essay for you Create order Rabobank Group is one of the foreign banks entering China at an early time. The unique operating characteristic of Rabobank Group is that it sets up the Credit Department of Agricultural Project to promote their international business. At present, it has representative offices in Hong Kong, Shanghai and Beijing, a branch in Shanghai. Meanwhile, it holds 10% share of the Joint bank of Hangzhou. Based the analysis of Rabobank Groups entry modes into China, this report suggests that Rabobank Group develops business in China at a steady pace which is however slower than other international banks. In the years coming, Rabobank Group should expand its market share in China at a faster rate in ways of establishing subsidiaries and expanding business in rural areas. 2.0 Introduction Rabo Group is an international financial services provider, offering retail banking, wholesale banking, asset management, leasing and real estate services, with its focus on all-finance services in the Netherlands and on food agriculture industries. It was set up in 1973, comprised of 152 independent local Rabobanks, Rabobank Nederland and a number of subsidiaries. As the second largest bank and one of the worlds 25 largest financial institutions, Rabobank Group has strong power in terms of capital. At present, Rabobank Group has more than 60,000 employees who service about 9.5 million clients across 46 countries (https://www.rabobank.com/content/about_us/). In addition to banking services, Rabobank Group is also involved in all lines of business. It has several specialized financial subsidiaries which deal with residential mortgages, ship mortgages, agents and rental business as well as a co-insurance (Interpolis). Distinguished from other international financial institutions, Rabobank Group aims to become the leading bank offering financial services in international food agriculture industries and international trade (Kai Huo, 2006). The New York branch of Rabobank Group, as its first overseas branch, has been the third largest financing bank of food and agriculture in America. Currently, based on its international network across Europe, America and the Pacific Rim, Rabobank Group has been implementing its global business strategy. 3.0 The Entry Modes into the Chinese Market 3.1 Setting up Representative Offices Firstly, Rabobank Group set its representative office in Hong Kong in 1988 which only covered financing business with enterprises. In 1994, another representative office was set up in Shanghai, and one year later, it was allowed by Peoples Bank of China to set representative office in Beijing (Encheng Liu, 2005). At this period of time, financial institutions in China are under very strict regulations, so establishing representative offices is an appropriate way to develop new market opportunities. The functions of representative office are very limited. It cannot deal with bank business, and the main function of it is to provide local government institutions and enterprises with credit analysis, economic and political information. 3.2 Establishing Branches In 1998, the first branch of Rabobank Group in China was founded in Shanghai. A professional research team comprised of experts in agriculture and food fields was also founded in order to support the Credit Department of Agricultural Project. Although branches are not independent entities, they are able to handle those businesses allowed by local government. Since China is a promising market with more and more foreign financial institutions rushing into China, Rabobank Group has to establish its branches in China. And Shanghai, as the financial center in China with so many favorable conditions such as large economic scale, abundant human resource of high quality, is the most ideal spot for Rabobank Group to establish its first branch in China. 3.3 Acquisition of shares Differing from other foreign banks tending to establish wholly-owned subsidiaries in China, Rabobank Group spent 100million RMB buying 10% share of the Joint Bank of Hangzhou in 2006, becoming the first foreign shareholder of the rural cooperative financial institutions. The cooperation agreements cover cooperation in nine modules such as risk management, human resources, IT and so on. In addition, Rabobank Group also signed agreements with the rural cooperatives in Liaoning province and Tianjin city, implying that it would probably become their shareholders in the near feature. The process of Rabobank Group entering the Chinese market has a lot of commons with other foreign financial institutions, like setting up representative offices and branches. The unique of Rabobank Groups strategy is its participation in rural cooperatives by holding shares rather than establishing its own subsidiaries (Shuolong Peng, Juntuo Su, 2007).They expected to expand business by union with local partners, in order to compete with its intro-industry competitors. 4.0 Analysis of the Entry Modes 4.1 Advantages of Acquisition of shares Less Cost and Combination of Resources ¼Ãƒâ€¦Ã‚ ¡Entering foreign market through acquisition of shares of goal companies is quite different from the ways by establish a new wholly-owned subsidiary or a brand new joint venture. Firstly, a new institution requires comprehensive conditions and facilities which are not necessarily required in acquisition of shares. Moreover, compared with establishing a new institution or organization, the examination and approval regulations are much less and simple in acquisition of shares. Secondly, by acquisition of shares, the shareholders can take advantage of existing resources such as network and distribution channels. Overcoming Investment Restrictions ¼Ãƒâ€¦Ã‚ ¡Since finance in China has not been wholly open to foreign enterprises, acquisition shares of Chinese banks can effectively avoid restrictions during the transitional period (Wenhuan Gao,2008). Through the combination of new product development, innovation of its own a nd distribution network of Chinese banks and RMB business, Rabobank Group can expand its market share in China more effectively, because it easily avoids business restrictions, particularly the restrictions on the RMB business. Sharing Profits ¼Ãƒâ€¦Ã‚ ¡Due to the unsoundness in finance market of China, the commercial banks are reluctant to be involved in financial services in rural areas, which however is a great opportunity for foreign financial institutions. In the long term, the development of rural area will be greatly favored by the Chinese government, therefore as the financial service provider in rural areas, the rural credit cooperatives are abound to be favored by the Chinese government. Through acquisition of shares of the rural credit cooperatives, Rabobank Group can enjoy expanding market shares and even profits after going public if possible(Bin Sun,2006). 5.2 Disadvantages of Acquisition of shares Less Control of Business ¼Ãƒâ€¦Ã‚ ¡Rabobank Group only holds 10% share of the Joint Bank of Hangzhou, which is still quite low. Compared with wholly-owned subsidiary, it has much less control of business. For example, it must follow all the rules, policies and decisions made by the Joint Bank of Hangzhou, which sometimes are not in accordance with its own needs and interests. Whats more, since the Joint Bank of Hangzhou is a regional bank, their businesses are greatly limited to the neighborhood of Hangzhou, which is not helpful in expanding markets in northwest areas where may have great business potential. Difficult to Adjust ¼Ãƒâ€¦Ã‚ ¡At the beginning of cooperation, various issues and contradictions may merge, in terms of management concept, knowledge background, behavior way institutional environment, legal environment, policy environment and so on. It is difficulty to come to a result of win-win because it is in fact the gap between two distinct kinds of cult ure that causes the contradictions. Knowledge Spillovers ¼Ãƒâ€¦Ã‚ ¡There are unconscious knowledge spillovers from foreign companies to local companies, through the channels of competition and demonstration effect, turnover effect and so on. And the knowledge spillover is more significant in joint ventures than in wholly-owned subsidiaries. On one hand, the spillovers of high technology, knowledge management and even some confidential information cannot bring Rabobank Group any economic profits because it cannot charge for that, on the other hand, it would strengthen the competence of its competitors. Low Brand Recognition ¼Ãƒâ€¦Ã‚ ¡Since Rabobank Group acts as the funds sponsor of the Joint Bank of Hangzhou who is mainly entitled to share profits. The Chinese clients may not very familiar with the existence of Rabobank Group since they are not aware of the relationship between Rabobank Group and the Joint Bank of Hangzhou. This is not favorable to strengthen its brand power and foster the loyalty of clients. 6.0 Recommendations 6.1 Set up Subsidiaries The differences between branches and subsidiaries lie in the fact that a subsidiary is an independent legal entity which is set up in accordance with the laws and requirements of host countries, with the access to equity financing. A subsidiary can handle all business allowed by host countrys laws. Although establishing branches and acquisition of local banks are of great help to develop business in China, it is not enough to implement Rabobank Groups global strategy. After setting up subsidiaries, Rabobank Group can handle many bank businesses which branches are not entitled to engage in, and manage the business and explore new projects in accordance with its own needs and strategies. 6.2 Expanding Market Share Compared with other international banks such as HSBC, Standard Chartered Bank and Deutsche Bank, Rabobank Group is left behind in terms of development rate, market share and reputation. With the accelerations of financial liberalization in China, it is essential for Rabobank Group to expand its market share at a faster rate. Considering that Rabobank Group has advantages over other banks in agriculture industry and the Chinese government now pays more attention on the agricultural development in rural areas, Rabobank Group should expand its market share, particularly in agricultural field, in the following ways: Developing Business in Northwest Region ¼Ãƒâ€¦Ã‚ ¡Northwest region in China is less attractive to both domestic and foreign banks due to its poor position and economic performance, however, the market potential there is large and the competition is much lower than the coastal region because most foreign banks are distributed in coastal region. Besides, Rabobank Gr oup can enjoy the preferential policies from the Chinese government (Anpo Fan, 2009) Focusing on Animal Husbandry ¼Ãƒâ€¦Ã‚ ¡Animal husbandry services as the leading industry in northwest region of China. Taking the Inner Mongolia Autonomous Region as an example, the animal husbandry there is very developed, making it a key region to develop in the future for Rabobank Group. Retail Banking ¼Ãƒâ€¦Ã‚ ¡Due to the Chinese contract system in rural areas, there are more individual clients than giant clients in rural areas. Therefore, it is more suitable to run retail banking instead of wholesale banking. Besides, local rural credit cooperatives place so many restrictions on loans that a great number of individual clients have no access to loans, implying there is still a huge market to be explored for Rabobank Group. Conclusion Rabobank Group is one of the foreign banks entering the Chinese market at an early time, mainly engaged in agriculture and food industry. Through setting up representative offices in Shanghai and Beijing, an branch in Shanghai, Rabobank Group started its business in China. Later, it succeeded in acquisition of shares of the Joint Bank of Hangzhou and signing agreements with other rural credit cooperatives. However, the development race of Rabobank Group in China is still slower than other international banks. It is essential for Rabobank Group to expand its market share in China at a faster rate. On one hand, it should set up its own subsidiaries in China, in order to be involved in more businesses and more independent; on the other hand, it should take full use of its advantages over other banks in terms of agricultural financing, expand its market in rural regions like northwest region in China, paying more attention on retail banking.

The American Prison System Is A Vital Portion Of American...

Merriam-Webster defines prison as a building where people are kept as punishment for a crime or while they are waiting to go to court. In the United States, there is a large prison system consisting of federal and state prisons. The American prison system is a vital portion of American culture. Crime runs rampant throughout our country and it is up to our prisons to punish people for these crimes, maybe even assist in loweingr the amount of crimes that occur. There are several different types of prisons, separated by gender, and differing through the amount of security depending on the type of prisoners. Prisons differ from jails as they are long term facilities; criminals may stay locked up in prison anywhere from a few months up to their†¦show more content†¦Numerous prison sentences last several years; even taking decades of a person’s life, for countless people prison is the only life they are familiar with. The U.S. prison system is necessary; however, the curren t question is whether it is effective. The prison system should be reformed so that the prisons are not overcrowded and that prisoners have an improved quality of life in and out of prison. The biggest issue with prisons right now is that they are extremely overcrowded. This problem is attributed to the rising crime rate. Currently the crime rate is fairly high, â€Å"Nationwide, law enforcement made an estimated 11,302,102 arrests in 2013† (FBI). Not all of these arrests were sentenced prison time, nonetheless thousands were. 631,200 people were incarcerated in prisons last year (Carson). Several people argue that the crime rate is lower than it has been, however the best crime rate is 0. Prisons aid in lowering the crime rate because criminals cannot commit crimes while they are locked up and currently there are around 2 million criminals not committing crimes (Prisoners), nevertheless once those prisoners are released they return to a life of crime. Statistics show, â€Å"two-thirds of prisoners will reoffend† (Criminal Justice). One of the main roles of prison is to rehabilitate prisoners so that they will not commit other crimes; however, it obviousl y is not working. To alleviate this problem, prisons should counsel prisoners and educate them on why crime is

How useful are the views of Anzac soldiers at Gallipoli suggested in Source A, B and C Free Essays

All the sources are useful because even though they may not be reliable, they show the people’s opinion of the Gallipoli campaign. Sources that show peoples opinion can be used to explore how the solders felt through out the wars. Source A was published in 1916, just one year after the Gallipoli campaign. We will write a custom essay sample on How useful are the views of Anzac soldiers at Gallipoli suggested in Source A, B and C or any similar topic only for you Order Now This makes it a primary source, which could mean that its more reliable as it was written nearer the time, and details have had less time to be forgotten. It was made on the Gallipoli peninsular, which shows that the artist had an eye witness account this would mean he was relying on his own knowledge not someone else’s. Although it as created by an Australian artist, which might mean it, is biased or exaggerated because he might want to make the Australians look better, it shows both the good and bad side of the war. The cartoons show two ANZAC soldiers as they looked during the Gallipoli campaign. The first cartoon shows a man in a large over coat, shoes that are to big for him, a gun, he’s yawning and has skinny legs. The large coat and shoes that are to big for him suggest that the supplies aren’t getting through and they are very low on resources so he has to use anything he can get. The skinny legs also show that there is a lack of food and that the soldiers are very weak. I know from my own knowledge that supplies weren’t getting through and that food supplies were very low. Also there were thousand of flies, which infected the food so that the little food that was left was not edible. The title â€Å"another hopeless dawn† shows the soldiers feel that they are not getting anywhere and that they are not going to progress anywhere with the knew day. The source is quite reliable and is useful because it shows an actual account of the soldier’s time in Gallipoli and is not over exaggerated to make them look better as it shows the positives and negatives. Therefore it can be use to show how the conditions affected the soldiers, it also shows what the soldiers looked like during the war. Source B is useful because it provides a historical account. However it maybe bias as an Australian writes it and he might want to make his army look better. It is a secondary source so it might be more reliable because there might be more sources available. Also the people who have written the sources he’s based his book on have had time to recover from the shock they may have suffered and write the sources more accurately. I know part of it is truthful and is reliable, as I know that the citizen soldiers were trained from an early age for military. It is also similar to the feeling in Britain – † to be left behind was unthinkable. So we know that this part is truth and reliable. However, part of the source is unreliable as it is just one man’s opinion (John Kegan). â€Å"New Zealanders skills with the rifle and spade would win them a reputation as the best soldiers in the war during the 20th Century. † We know this is not true as the New Zealanders lost their battle at the Gallipoli campaign to the Turks. As the British and French troops won most of their battles during the first and Second World War it could be argued that they were the stronger and better troops of the 20th Century. It also says in the source â€Å"†¦ ormidable offensive power, as the Turks were soon to discover† we know this is not true as they lost to the Turks. I also know the landings at Sulva bay went wrong for the ANZAC troops and also the landings at ANZAC cove and Cape Helles beach failed. This shows they cannot be the â€Å"formidable offensive power† the author makes them out to be and that he is maybe exaggerating what happened to make it his troops sound better. This source can be used as an insight as to what happen when the new Zealanders got called up to war, and what the New Zealand people thought of their troops. Source C is written by a reporter, but it is not clear as to what country he is from, the way he talks about the Australians suggest that he is not from Australia, but is impressed by them. He seems to over exaggerate the part they played in the war and the way they dealt with it. This would suggest the source is unreliable as it is his own opinion not actual facts. This source shows what some people thought of the Australians â€Å"it was great to watch them as they went†. It shows the high moral and ANZAC spirit that was present through the campaign, I know this is probably true because is very similar to what happened in Britain through out the first and second war there was arguably very high British spirit. It also has some inaccurate points i. e. ‘absolutely unaffected by the bullets’ – this cannot be true as many troops were killed by bullets. I know that there were 200,000 allied casualties and some of these were from the ANZAC troops, therefore they weren’t unaffected by bullets. This source is best used as an opinion and insight into what was thought of the Australians rather than as reliable account of what actually happened. In conclusion Sources A, B and C are useful in different ways. Source A is the most reliable and accurate account of what actually happened and could be used to show what actually happened. Source B and C is best used as opinions of what happened, where the truth may have been exaggerated or distorted. It can be used to show an account from the ANZAC point of view and how their people felt towards the campaign. How to cite How useful are the views of Anzac soldiers at Gallipoli suggested in Source A, B and C, Papers

Engston Auto Mirrors Plant free essay sample

Employees were satisfied with their Jobs and motivated to be productive. Over time, changes needed to be made to adjust the Scanlon plan because employees became less satisfied and enthusiastic. Employees no longer trusted the management and committees; they believed the management team may be changing the ratios and numbers that affected their monthly bonuses. Also, employees began to think the plan was unfair. Bent was not surprised by the reactions of his employees, he knew the plan needed to be revised every so often. In 2005, before he could decide how to revise the plan, the industry downturn gradually decreased the companys sales figures and the employee morale. The employees werent receiving monthly bonuses due to low productivity and Bent had to start looking into the idea of a layoff. He warned the employees of a layoff occurring if sales fgures didnt improve, but the employees didnt listen. Finally a layoff did occur and it was like an emotional lightning rod for the plant and a dividing line between the good and bad times. By 2007, there was increasing evidence of dissatisfied employees and suspected pilfering. Employees had lost their motivation to work productively. So what caused such a decrease in employee motivation at the Engstrom Auto Mirror Plant? The Scanlon Plan was adopted to improve motivation which would also improve other workforce factors. Although, the plan only seemed to work during good times; as soon as things began to go wrong and head for the bad, the Scanlon Plan alone could no longer motivate the employees. One reason for why it wasnt able to motivate employees during the bad times because of its variable-pay program. According to Robbins and Judge, authors of Organizational Behavior, a ariable-pay program is a pay plan that bases a portion of an employees pay on some individual and/or organizational measure of performance (p. 229). Engstrom developed a bonus pay, but managers were able to adjust the value for returns and increases or decreases in inventory which would change the size of the employee bonuses. In Organizational Behavior, it is explained that bonuses are part of the the calculation for the bonuses to be altered by management, employees lost trust in their management instead of seeing the industry downturn due to profitability trends as the reason for bonuses being low or non-existing. The lost of trust in management led to less motivated employees. Bent did not adopt the idea of a variable-pay program usefully. Also, employee motivation didnt occur in both good times and bad because the Job design didnt match the Job Characteristics Model OCM). Robbins and Judge describe the JCM as a model that proposes that any Job can be described in terms of five core Job dimensions: skill variety, task identity, task significance, autonomy, and feedback (p. 215). If a Job has the one of the first three characteristics†skill variety, task identity, and task significance†and both autonomy nd feedback, motivation will occur. Because motivation hasnt occurred constantly for Engstrom, they must be missing part of the JCM. The causes for the motivation problem at Engstrom Auto Mirror Plant needs to be fixed or diminished. Ron Bent needs to find a way to once again get his employees motivated. He could revise the Scanlon Plan to work during the bad times, like during a downturn, or Bent could change organizational factors that might be undermining the plan or he could Just get rid of the Scanlon Plan all together and find a new way of motivating employees whether it being an incentive plan or not. When the plan no longer was enough to motivate the employees, Bent knew the plan needed to be revised. He had said, A Scanlon program wont perpetuate itself. You have to give it a shot in the arm every so often†whenever the work force needs it (Beer and Collins, p. 6). To revise the plan, Bent needed to listen to the employees complaints. Part of the Scanlon plan was to listen to suggestions of the employees, so the complaints should have been just as important to listen to and evaluate. The employee complaints were about the distrust of bonus calculations and questions of fairness. Bent and his management eam should have seen the complaints as a suggestion for improving the bonus plan. Another alternative would be to change the organizational factors of the company. Bent could do this by using the Job Characteristics Model. Due to the Scanlon Plan, the company had already met the fifth characteristic of feedback, but Bent could also look at ways to improve the autonomy, task significance, task identity, and skill variety of his company. By improving those characteristics, it could help the Scanlon Plan to further motivate employees. Lastly, Bent could decide to ultimately get rid of the Scanlon Plan at his Engstrom Auto Mirror Plant. Bent could motivate his employees by solely using the Job Characteristics Model. The Scanlon Plan caused his employees to distrust the management, so the best idea would be to no longer use the plan. Having distrust in management wouldnt help to motivate employees at all. Bent should redesign the Jobs at his plant to better meet the JCM, which in theory would motivate his employees. There are five characteristics of the Job Characteristics Model that Bent would need to try to meet. First off, he would need to look into offering his employees skill variety, task identity, and/or task significance. If Bent could meet at least one of those characteristics, it would be very beneficial to his plant. Skill variety would consist of the employees Jobs including a variety of different tasks, so that they could use different skills and talents they may have. Task identity would require the employees Jobs to consist of completing a whole and have a significant impact on the lives or even work of other people. By at least offering employees Jobs that meet one of those characteristics, Bent would be also offering meaningful work. Also, Bent would need to offer his employees Jobs that consisted of Autonomy. Autonomy would give the employees freedom, independence, and discretion to scheduling and carrying out their work. By giving employees this freedom, Bent would be offering his employees personal responsibility. Lastly, Bent also would need to offer feedback to his employees. Feedback should be done by giving employees information about the effectiveness of their performance. By meeting the criteria of the Job Characteristic Model, Bent would not only see greater employee motivation, but also greater performance and satisfaction, and lower absenteeism and turnover. Once, Bent had figured out ow he was going to meet the criteria of the Job Characteristic Model, he could take it further by redesigning his employees Jobs. Organizational Behavior gives threes ways this can be done. First of all, Bent could use Job rotation. Job rotation is when an employee is periodically shifted from one task to another when an activity is no longer challenging, but the nature of the work would stay the same. According to Robbins and Judge, this would reduce boredom and increase motivation through diversifying employees activities, and helps employees better understand how their work contributes to the organization (p. 18-219). Bent could also use Job enlargement. Job enlargement consists of increasing the number and variety of tasks an employee performs. This is different from Job rotation because the employees Job would be actually changing; the nature of the employees work would be different. The best choice of redesign that Bent should choose for his Engstrom Auto Mirror Plant is Job enrichment. Robbins and Judge explain it as, an enriched Job organizes tasks so as to allow the worker to do a complete activity, increases the employees freedom and independence, increases responsibility, and provides feedback so ndividuals will be able to assess and correct their own performance (p. 220). If Bent were to redesign his plant to have Job enrichment, he would most likely see a great increase in motivation and satisfaction, and also reduced absenteeism and turnover costs. If the Engstrom Auto Mirror Plant, adopted the Job Characteristics Model as their plan to motivate their employees, employees would be motivated at all times. The problem with the Scanlon Plan was that when things went bad in the company, the employees would blame the plan for any problems and lose motivation. By using he Job Characteristics Model, employees would have a hard time placing the blame on it. Also, during the bad times, the working conditions of employees wouldnt be affected very much or at all because the model is based more on individual work than as the whole organization production. Ron Bent should consider ending the Scanlon Plan and then using the Job Characteristics Model to motivate his employees during both the good times and bad.