KARUR VYSYA BANK

Concept Note
MIS
Pankaj Singh (x01019);Sagar Maguniya (x01023)

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Introduction

We have chosen Karur Vysya Bank to understand the MIS while applying the concepts of
organizational structure. Also find the management and its control, data and information
management, the formulation of metrics in order to measure the performance of the organization
and sustainability measures.

Karur Vysya Bank Limited, which has emerged as one of the leading banks in the private sector,
has its birth on the 1st July 1916 in Karur, which is presently the district headquarters. It has
completed 100 years of successful journey and first among the private banks to have achieved so.
1916 to 2016 was by no means easy to survive for most businesses, forget banks. When KVB
started its life, World War I was raging on, drawing even Indian soldiers serving the British
army, into action. The most impressive, about KVB has always been profitability. It has always
shared profits to its shareholders as dividends, through these one hundred years. Given how
many banks have not even survived 50 years to tell their story even, this focus on profitability or
sustainability is what has helped KVB to beat all odds.

Generating profits and sharing it equitably has happened in KVB when there was a large
promoter group in the bank, and also when later day regulations limited promoter group holdings
in all private sector banks. Even in these troubled times for banks due to asset quality concerns,
KVB's core metrics are healthy with its FY’16 Net Interest Margin at 3.08%, Net Profit Margin
at 10.42%, Return on Assets at 1%, and Return on Equity at 12.41%.

Organization type and life cycle

Karur Vysya is a business organization and is primarily motivated to increase value of the
shareholders. It has market orientated approach. The organizational structureis dynamic, constantly
evolving and responsive to changes both in internal as well as external environment. Its structure is
designed to support its business goals and is flexible while at the same time ensuring effective control,
supervision and consistency in standards across business groups.

Level of formalization: Since the organization is adaptable to dynamic environment, it has a less
formalized structure. Rules and regulations are not very strict and can be changed on the basis of
market demand. This organization is able to change both internally as well as externally.

Level of centralization: The operations are more decentralized in this organization as the branches
have adequate level of flexibility, within a defined level of control framework to ensure faster customer
service and decision making.

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Karur though is an old entity but still in its growing stage of its organizational life cycle. At this
stage of organizational development, it is focusing more on innovating products to compete in
the market with eyes on new market and areas as never before.

Organization Life cycle: Managing Barriers

Inception Growth

Organizational management

KVB takes hands-on decisions to sustain the competitive advantage and keeps on innovating and
by formulating its strategy well before any change in the market. It is now investing lot into
industry 4.0 for products and advance technology and uses net banking, AI tools, apps to be
close to customers.

Organizational structure

Karur Vysya has divisionalized organizational structure. In a divisionalised structure, a small

central core provides guidelines for business units that enjoy a high degree of autonomy.
Mintzberg states that this is an extension of the machine bureaucracy, or may even comprise
several machine bureaucracies within a single corporation. It is the middle line that forms a
strong coordinating influence, as its key role is to translate the demands of the small central core
into the objectives of the operating core.

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 Divisionalised structure

Products of KVB

KVB has its focus on customers and product segmentation and innovation. Lot of banks do
provide the same kind of services but a bank which was confined only in south India is opening
new branches and spreading its reach by opening ATMs and use of app.

Market of KVB

KVB has widespread reach now in south of India and making inroads in west and east part of
India. Uses fast tag and UPI and serving its customers in abroad too.

Resources and people at KVB

The product differentiation and services of KVB have been its strong has been always attracting
new customers.

It has 788 branches and network of 1803 ATM's and around 538 cash deposit machines as on 12
August 2018. KVB has recorded a Total Business of Rs 1 lakh crore with deposits of Rs.56000
crores and advances of Rs.45000 crores.

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