A quick overview over TD Canada Trust reveals that it is a small personal commercial bank based in Toronto Canada, offering a variety of financial services and products. At the moment, the company commands a client base of over 10 million customers through its more than 1100 branches and over 2600 Automated Teller Machines all over Canada (Darroch, 1999). It is undoubtedly one of the largest financial firms in Canada. As the strategy and performance analysis will reveal, TD Bank’s successful performance can largely be attributed to the managerial policies implemented by the bank’s top most leadership.
Analyzing TD Bank’s performance basing on the Five P’s strategy majorly seeks to establish the effectiveness of the firm’s management in achieving organizational goals. There cannot be effective management without a plan which serves as a guideline to all the activities of the organization. The operational plan for TD Bank id designed by the managers and later ratified by the directors of the dame bank. The plan does not become binding until it’s approved by the shareholders during their annual general meetings. This then becomes an intended course for the company, defining the annual objectives that the bank strives to achieve in the course of the financial year, a pattern that defines the banks course of action (Ritchie, & Wruk, 2007). At the end of the financial year, evaluation is thus done basing on the goals and objectives set and documented in the plan.
In terms of perspective, TB Bank can be described as an aggressive pacesetter, always ahead of others in implementing the latest technology and embracing current banking trends. For instance, the introduction of the mobile banking app, Easy Web online banking, for smartphones was a typical ploy to give TD Bank an edge over other similar financial institutions that had heavily invested in online banking platforms and never saw the mobile app coming. This has largely paid off, especially with the convenience it offers to the customers who might be unwilling to travel to either the banking halls or the Automated Teller Machines locations (United States., & Board of Governors of the Federal Reserve System, 2015). A combination of ploy and perspective is what defines the banks’ business development segment. In fact, the business development segment of the bank has been converted into a research department whose core function is to research and advice the management on the most innovative strategies to beat competition on the market.
In terms of position, TD Bank is among the best performing financial institutions in Canada. One factor that has largely contributed to this is because the bank has been on the Canadian market enough and therefore understands most dynamics and characteristics of the market. Most of the new financial institutions are either new and thus needs sufficient time to match the standards of TD Bank. Despite the evidently stiff competition, TD Bank has consistently posted convincing profits each financial year, an implication that it’s steady and resilient enough to withstand competitors’ pressure (Green, 2014). In fact, once a firm gains a reputation as that of TD Bank on the market, then it becomes extremely hard to dislodge it from its position. A secret to TD Bank’s consistent performance is that the bank experiences very minimal turnover rates and prefers training its own managers up the hierarchical ladder rather than hire from outside.
Another analytical approach to analyze the strategy and performance of TD Banks would be using the Building Block Analysis which evaluates the financial performance characteristics of the ban such as solvency, market prospects, profitability, liquidity and even efficiency of the firm as a unit. To begin with TD has prospects of hitting the international market in the near future. For instance the introduction of the Flash Access Card was intentionally meant to attract international merchants who might wish to make financial transaction through the Visa network. The successful introduction of the card into the market has necessitated plans for TD Banks to go international. Solvency and liquidity go hand in hand. For instance, the fact that TD Bank has consistently posted huge after tax profits implies that the company has a low solvency ratio and a low liquidity ratio, hence sufficient ability to meet both its long term and short term liabilities. Profitability of any firm is actually determined by the firm’s liquidity ratio as well as the solvency ratio. In the event that the two ratios are high, then most firms often close down since they cannot sustain operational costs. The fact that TD Bank is still active then implies that it collects sufficient profits to facilitate its continued operations.
TD Bank commands a significantly high trust from its loyal clients, and thus a high value position. This has been consistently built through a committed and effective customer service. Loyalty from customers is earned and never comes for free. In fact, TD Bank’s ability to open various branches in Canada is largely built on such existing customer relations. The bank finds it easy to penetrate and establish its brand in both new and existing, markets since it has a good reputation and rating among the clients. Capability analysis evaluates the firm’s ability to meet certain requirements and in this case, the analysis as explained is based on TD Bank’s ability to expand its current scope of operation, to penetrate and establish in international markets too. Capability analysis thus subsequently rates TD Bank very high, with a potential to threaten monopoly in the Canadian financial industry (Darroch, 1999). If a single company can own and operate over 1000 branches in a single country, then it means more than half of the entire market is a segment for TD Bank. If the current performance trends are upheld, then the bank has a big chance of making a breakthrough on the international market soon.
References
Darroch, J. L. (1999). Canadian banks and global competitiveness. Montreal: Mcgill-Queens Univ Press.
Green, H. (2014). Banking on America: How TD Bank rose to the top and took on the U.S.A.
Ritchie, T. F., & Wruk, B. D. (2007). The Canadian snowbird in America: Professional tax and financial insights into temporary lifestyles in the U.S. Toronto, Ont: ECW Press.
United States., & Board of Governors of the Federal Reserve System (U.S.). (2015). Federal reserve bulletin. Washington [D.C.: G.P.O.
