Bank Challenges – The Impact of Influential Stakeholders and a Dynamic Environment

Abstract: Title: Bank Challenges – The Impact of Influential Stakeholders and a Dynamic Environment Date: June 5th, 2013 Institute: School of Business, Society and Engineering, Mälardalen University Classification: Master Thesis in Business Administration, 15 ECTS Authors: Sara Pierre and Johanna Russo Tutor: Carl G. Thunman Keywords: Bank, banking sector, stakeholders, financial market, environment, environmental factors, bank activities and change. Purpose: The purpose of this thesis is to identify, describe and analyze the opinions and assertions of business journalists and financial market experts in terms of what challenges have caused the greatest impact on bank operations during the last five years, by using stakeholder groups and environmental factors as determinants. Methodology: In order to produce a chapter consisting of conceptual foundations, a qualitative research method has been used where the majority of sources providing secondary data have been reviewed. The concepts selected were then compared and analyzed in comparison to data retrieved from four interviews with experts on the subject of bank management as well as 86 newspaper articles retrieved from a scanning of Swedish newspapers. From this comparison, a matrix consisting of an arrangement of the challenges faced by the Swedish banking sector today was created, where the most crucial challenges functioned as a basis for the analysis of the thesis, from where the recommendations and conclusions were derived, intended to fulfill the specified purpose. Conclusion: The Swedish banking sector has been facing considerable challenges as of the last five years. Due to this, banks ought to find a way to balance shareholder dividends in order to ensure further operations through continuous investments. Similarly, there is a need for managing the balance between competition and cooperation so as to promote a healthy environment. Banks may face challenges by allowing some stakeholders too high amounts of dividends, causing customers to lose trust as a result of inappropriate treatment. The alterations in bank services has resulted in a need for providing appropriate employee training. Similarly, banks are faced with the necessity of balancing the needs of multiple generations. The increased spread of customer complaints indicates a need for managing the banks’ reputation and thus also the introduction of ethical behavior.