Strategic Management for AIB Case Study Example | Topics and Well Written Essays - 3000 words

Strategic Management for AIB - Case Study Example The significant difference of AIB's entry into the Polish market compared to its activities in the English-speaking countries of Ireland, UK and US points to this. Whereas the UK and US market entries were planned as niche-marketing strategies, the entry to the Polish market was opportunistic. It is questionable whether the diversity of the expansion that it undertook was underpinned by a real understanding of its own capabilities. In this sense, AIB's strategic management, while demonstrating flexibility, also lacked other desirable characteristics such as harmonisation, and concentration and coordination of resources (Thompson 2005) AIB's realisation that niche marketing would be a strong marketing tactic outside of Ireland is an indication of certain marketing strengths within the organisation. Coming from a generalist banking position within its country of origin, Ireland, AIB correctly avoided the trap of trying to be a generalist contender in other countries in Europe, especially as legislation at the time made it difficult for most banks to be a force outside of their own national boundaries (Johnson & Scholes 2007). AIB's niche marketing and beachhead strategy in the UK was an example of entrepreneurial marketing inspired by the understanding of focusing on one sector to differentiate their presence and to clearly position AIB in the UK (Ries & Trout 2001). Its move to replicate a successful UK model was a natural one. The US market was almost an order of magnitude bigger than even the UK market and the language was once again English. AIB had the sense to see that a further beachhead could be the Irish e xpatriate community and exploited this possibility successfully (Moore 2002). However, its failing once again in strategic management may have been in not recognising the fundamental differences in the US, already strongly deregulated compared to Ireland, the UK and Europe. The "halo effect" of a positive start in an specific context (serving the Irish community in the US), the unjustified assumption that speaking the same language meant playing by the same rules and omitting to take account of a substantial difference in distance and time zones may have been the factors that led to a markedly hands-off attitude by AIB Group in Dublin. Choice of strategy here was sub-optimal in terms of efficiency and communication, even if AIB managed to preserve the distinctiveness that had already served it well (Thompson 2005). The strategic management methods of AIB relating to its US operation of AllFirst seem all the more curious when compared to the way that the entry to the Polish market came about. AIB had had significant management involvement in Eastern Europe, admittedly as "position filling" initially for the World Bank, but which developed into a network of coordination and control, and possibly of management development (Harzing 2001). It was this network that was instrumental in the opportunity coming about to twin with a Polish Bank. With this management strength that was the result, AIB was in a natural position to reinforce control and beneficial exchange with its US operation. However it took the Rusnak trading scandal with AllFirst to open