mgt 162 sme bank

MGT 162

Muhammad Syamil bin Kamal

Muhammad Ariff Azanis bin Azman

Muhammad Firdaus bin Ramli

Nur Diyana Afiqah binti Mahashim

Amalina Diana binti Mohd Kassim

Nur Hazirah binti Ishar

Company background• The SME Bank was previously known as “Bank Industri dan Infrastruktur

Malaysia Berhad” was incorporated under the Act on 7 August 1979 as Bank Industri Malaysia Berhad. It later changed its name to “Bank Industri& Teknologi Malaysia Berhad” on 28 February 2000. SME Bank assumed its present name following the merger with Bank Pembangunan & Infrastruktur Malaysia Berhad on 1 October 2005.

• As a one-stop financial centre responding to the funding and business growth needs of Malaysian SMEs, the Bank complements existing products and services offered by commercial banks through a comprehensive and integrated financial and business advisory services. It is a wholly owned subsidiary of Bank Pembangunan Malaysia Berhad.

• SME Bank has an authorised share capital of RM1 billion comprising 1 billion ordinary shares of RM1.00 each, of which approximately RM770.45 million comprising approximately 770.45 million shares have been issued and fully paid-up as at 31 October 2005. The SME Bank is dedicated to the accelerated growth of Malaysian SMEs and designed to function ultimately as a one-stop financing and business development centre.

• Vision Statement

To become the SME Hub with the unique capability to evaluate, promote and grow Malaysian SMEs with a focus on the development of the Bumiputera Commercial and Industrial Community (BCIC) in line with the Government’s aspirations.

• Mission Statement

In achieving recognition as the SME Hub, the management and the employees of the Bank will collaborate with its network of strategic partners to support government’s economic agenda in developing SMEs as an engine of growth.

• Company’s objectives

The principal activities of the Bank are to provide financing as well as financial and business advisory services to Malaysian SMEs residing within predefined categories, which have been framed within the SME classification guidelines of the National SME Development Council.

STRATEGY PLANNING• Superior Economic and Industry Sector : Understand the market to

identity and develop high growth / high profitability segments.

• Market Leadership in Chosen Segments : Carefully define your customer segments and be a leader in your chosen market rather than trying to win the whole of the SME segmen.

• Cost Control : Take advantage of opportunities for standardisation, process re-engineering, and adoption of new technology to improve efficiency and reduce costs.

• Cross-Selling : Maximise cross-sell opportunities to capture all the fee income and liability-side business you can, and also the lucrative personal business of directors and owners

• Leadership : Make sure the SME business is sponsored at the most senior level, and the business has a Board-level profile.

TYPES OF ORGANIZATIONAL STRUCTURE

• Tall organizational structure.

• The organization is clearly departmentalized by function.

SPAN OF MANAGEMENT

• Narrow span management.

Senior Management

Advantages and disadvantages of organization structure

SME BANK’S PRODUCTSContract Financing

General Features:

Contract Financing Scheme is a financing package based on product bundling concept of financing facilities which are already available in the Bank.

The scheme offers financing to customers who are Main Contractors or Nominated Sub-Contractors having secured contract(s) from approval awarding parties mainly

government ministers, departments and agencies.

• Mechanics of Financing:

Providing loan facilities to fund the implementation of contracts until full completion.The funding mechanism works by assigning the contract payment to the awarded

parties direct from the Bank.Financing is offered on a pre-implementation or post-completion basis, or a

combination of both.

Types of contract:

Supply direct supply contract or contract with added value in the form of installation, testing, commissioning, and training.Construction and infrastructure projects including works in civil, mechanical, electrical and information & communication technology.Other business services contract such as providing services and maintenance.

• What do you learn from your observation and searching info on the organization?

Thus, this organization applies tall organization structure and narrow span of management which characterized by many levels. They have their own strategic plans in order to achieve their desired goals and objectives which is the principal activities of the Bank are to provide financing as well as financial and business advisory services to Malaysian SMEs residing within predefined categories. They also offer various products in order to satisfy their customers needs. For instance, i-reach, i-surf, i-splash and etc.

Our meeting with one of the former senior management from the head-quarters.