Constructing The Core Competence Of China-invested Commercial Banks

It is a significant topic to advance the core competence of China-invested commercial banks, which attracts lots of attention from Chinese government and banking supervisory and regulatory authorities and has been the vital issue among other important issues of resolving the Chinese Financial difficulties. This issue has been heatedly discussed theoretically by the academic community and given practical attempts by the industry for a long time since Reform and Opening up.Based upon the concept of "Core competence" proposed by the classic article The Core Competence of Corporations published in "Harvard Business Review" in 1990, this paper tries to apply bank value theories and mathematical set theory for logically analyzing the construction of Core Competence and its constituents , tentatively defines the Core Competence of China-invested banks and proposes its constructing model. Furthermore, it specifies the measures to advance the constituents of Core Competence and finally provides several choices for constructing the "Core Competence" of China-invested commercial banks. This paper is divided into six chapters besides the Introduction.Chapter one is a theoretical foundation for the whole paper. Starting from the definition and a brief theoretical introduction for core competence and commercial banks' core competence respectively, this chapter applies bank value evaluating model and bank value creating model to innovate the theories for core competence of the China-invested commercial banks from three perspectives. The three theoretical innovations include that: firstly, value creation is the ultimate objectives and driver for core competence of commercial banks; secondly, the core competence is banks' rooting power; thirdly, the core competence is the "intersection" of all necessary competence of banks.Chapter Two proposes that the marketing competence is the ultimate reflection of China-invested Commercial banks' core competence, since the marketing performance is the best indicator of the strength and weakness of a bank's core competence. Chapter Three presents that the risk management is also an ultimate reflection of China-invested commercial banks' core competence, and carries almost equal importance in contributing banks' core competence, and also a best indicator of the strength and weakness of a bank's core competence. Chapter Two and Three co-emphasize that lacking in strong marketing and risk management abilities, the so-called banks' core competence deems to become illusion.For constructing China-invested commercial banks'core competence, Chapter Four proposes four supporting power: capital management ability, corporate management ability, strategy management ability and human resources management ability, lacking in any of the above mentioned power, the core competence would lose support and the attempts to constructing core competence would fail.Chapter Five specifies the groundwork for constructing China-invested commercial banks' core competence - Bank culture. A bank without culture is just like "trees without roots, water without sources," do not even thought to mention the core competence. A flower without soil has no live, and even the most beautiful one is merely "flash in the pan"Chapter Six puts forward with the feasible choices for constructing China-invested commercial banks' core competence. As the conclusion of the paper and Based upon the fore five Chapters' logically analyzing, This Chapter specifies the measures to advance the constituents of Core Competence and finally provides several choices for constructing the "Core Competence" of China-invested commercial banks.