Organizational Structure Design - Bank Industry

 

PART 1

 

The organization that I choose is a Bank specifically BCP Bolivia I was work in this bank for almost 8 years and I have some information and knowledge about the culture and organizational structure.

 

BCP Bolivia is part of the Credicorp Group, one of the most important financial conglomerates in Latin America. It combines the banking businesses of BCP and Atlantic Security Bank with the insurance businesses of Pacífico Peruano Suiza, the largest company in its sector in Peru. Credicorp's shares are listed on the New York Stock Exchange, providing easy access to international capital markets.

 

The Mission: We want to be the first choice for customers in the Bolivian Financial System.

The Vision: Provide opportunities to Fulfill Dreams, Build the future, and contribute to Bolivia.

The principles of the banks are:

 

Customer-centric

Our customers are at the center of all our decisions. That's why every product, every service, every solution, and every decision is for the customers, by the customers, and with the customers. We aim to always deliver a unique experience based on a simpler, more agile, and closer service.

 

 

One team

We share objectives with all departments, we either win together or lose together. We are one team. We organize ourselves to streamline our work, collaborating generously. As a team, we prioritize the greater good.

 

Striving for more:

We promote excellence in everything we do. We are passionate about challenges and face each one with attitude and willingness to achieve the best outcome.

 

Building trust:

We promote trustworthiness, we fulfill our promises and strive to be transparent with responsibility, meeting deadlines, and keeping our customers informed.

 

Open to change:

We promote innovation and remain open to change. We welcome and develop ideas, regardless of their source, and embrace mistakes when trying new things as a learning experience.

 

PESTEL

 

Political:

Political stability in Bolivia is essential for the proper functioning of BCP Bolivia and the financial industry in general in the last years experienced internal political problems which affected the investment portfolio of the bank.

Economic:

Economic conditions, such as GDP growth, inflation rates and interest rates, affect the demand for banking services and the profitability of BCP Bolivia.

Since the pandemic, the Bolivian economy has experienced an economic contraction that increased past-due accounts and the reduction of savings.

Social:

Social factors such as demographic trends, consumer preferences and income levels influence demand for banking products and services.

About 80% of the Bolivian economy is informal, meaning that it does not have a register as a company but the bank adapted to give credit to these informal sectors through Micro Credits.

Technological:

Technological advances in the banking industry such as digital banking, mobile banking applications and financial technology innovations were made by the BCP, today has a team focus on innovation and focused on customer experience.

Environmental:

The Bank focuses on environmental practices through the Department of CSR (Responsible Social Environment). Implement carbon footprint and paper reduction policies in all bank processes.

Legal:

The bank enforces domestic banking regulations, international anti-money laundering laws, consumer protection laws and corporate regulations such as the SOX (Sarbanes Oxley) law.

 

All of these perspectives the most important for the bank would be Political, Economic and Society because all of them are the core of the bank and define the success of its mission and vision.

Internal Environment 

Analyzing the internal environment of BCP Bolivia, several key factors significantly impact its organizational structure. Firstly, the organization's tasks involve providing a wide range of banking services, including retail and corporate banking, as well as various financial products. The complexity and scope of these tasks necessitate an organizational structure that ensures efficient coordination and execution to meet customer demands effectively.

 

Secondly, the goals of BCP Bolivia, as outlined in its mission and vision, revolve around becoming the preferred choice for customers in the Bolivian financial system and contributing to Bolivia's development by providing opportunities. To achieve these goals, the organizational structure should be designed to support customer-centric strategies, foster innovation, and prioritize trust-building initiatives.

 

Thirdly, considering the job characteristics within BCP Bolivia, various departments and functions require specialized skills and knowledge. This includes expertise in areas such as retail banking, commercial lending, risk management, marketing, and technology. To accommodate this diversity of job characteristics, the organizational structure should provide clear reporting lines and effective communication channels to facilitate seamless collaboration across different roles.

 

Lastly, BCP Bolivia's growth cycle is a crucial factor influencing the organizational structure. As part of the Credicorp Group, the bank may encounter growth opportunities and expansion prospects. Therefore, the ideal structure should be flexible and adaptable, enabling scalability, efficient decision-making processes, and effective coordination to support the bank's evolving needs throughout its growth journey.

 

Functional structure: The functional structure would be suitable for core functions such as retail banking, commercial banking, risk management, operations and technology. It allows specialization and expertise within each functional area, ensuring efficient operations and service delivery. Additionally, to have areas focused on continuous improvement in systems and processes that support the requirements of the core areas of the bank.

 

The proposed organizational structure would be suitable for BCP due to several reasons. Firstly, it emphasizes a customer-centric approach, aligning with BCP's focus on delivering exceptional customer experiences. The structure includes dedicated divisions for Customer Experience and Digital Solutions, enabling specialized attention and innovative digital offerings to meet evolving customer needs. Secondly, the structure promotes efficient coordination and decision-making with specific division managers overseeing key areas such as Finance and Capital Markets, Legal, Human Resources and Corporate Social Responsibility, Corporate Banking, Audit, Risk, Retail Banking, Marketing and Communication, as well as Advisory and Projects. This ensures clear leadership and optimized implementation of strategies and projects across the organization. Moreover, the structure facilitates specialization and expertise, with divisions dedicated to critical functions like Finance, Legal, Risk, and Audit, enhancing the management of these essential aspects of the banking business. Lastly, the adaptable nature of the structure enables the bank to effectively respond to market changes and support growth, as evidenced by divisions dedicated to areas such as Corporate Banking, Retail Banking, and Marketing and Communication.

 

In summary, the proposed structure prioritizes customer-centricity, efficient coordination, specialization, and adaptability to growth, making it well-suited for BCP. These characteristics align with the bank's mission and vision and contribute to its success in achieving strategic objectives.

References:

BCP. (n.d.). https://www.bcp.com.bo/NuestroBanco