Investment banking: Strategic roadmap 2009

Abstract

Analysis of the Investment banking landscape from the years 2001 to 2008 was done by structuring the study in the following fashion. 1) Key highlights in the industry: Identification of the key issues and opportunities which had the maximum impact on the Investment Banking industry for the respective year. 2) Revenue patterns in the Industry & Comparison of Performance of the Investment Banks: Analysis of Revenue patterns across the various business lines and comparison of the Investment banks to find out the outperformers of the year based on revenue and profit margin statistics. 3) Successful Strategic actions followed by the leaders: Listing of the strategic actions followed by the investment banks which attained leadership positions among other banks. This enables isolation of the strategies contributing which truly help the leaders differentiate and attain competitive advantage over the others. 4) Mapping Strategic actions to Strategic Principles: On isolation of specific strategic actions that the leaders took to attain competitive advantage, we map them to the strategic principles of Corporate Strategy. We felt that since investment banks are highly impacted by the economic cycles by the very nature of their business, that their strategies should be modelled around the nature of the economic cycles. Through course of our study we realised a pattern in the strategy followed by the leaders through the years was in sync with the economic cycles. We finally present a Strategic framework for Investment banks which would make an investment bank more competitive with every passing economic cycle; while its competitors keep fading out.