Chapter 3 - Enabling Components (How do we get there)

  1. Business Improvement Plan (BIP)
    1. Products and Services
      • Offer the traditional products and services of the Bank (Deposits, Loans and Other Products). See Annex C.1 - List of Existing Products and Services
      • Develop new products to cater to new markets and increase the level of loans and deposits to support the branch network expansion program in the next five years, viz: for 2012, (1) Cash Cards; (2) Remittance (Money Transfers) via IMO, PMO and Swift; and (3) Bills Payment Services. For 2013-2016, the Bank will be offering also Electronic Document Exchange (payment for Census, Taxes, SSS & GSIS contribution, etc.)
      • Tie-up with PPC on domestic and international remittance to create synergy/fusion and optimization of resources of PostalBank and PhilPost
      • Establish programs relevant to community development and people empowerment See Annex C.2 - Product Development Plan (new products and services to be offered by the Bank) in the next five years
    2. Target Market
      • Cater to existing markets on loans and deposits
        • Consumer Sector
        • Government Sector (LGUs, NGAs, GOCC, etc.)
        • Micro, Small and Medium Enterprises (MSME)
        • Private Corporations
        • Agricultural Sector
        • Housing and Real Estate Sector
        • Community Organizations (NGOs, corporations, etc.)
      • Expand of client base with specific emphasis on LGUs/community organizations to directly impact the countryside
    3. Geographical Reach
      • Expand Branch Network

        The PostalBank and PPC have joined hands, to better serve their customers, especially in the areas of information technology, financial viability and product development. The vision focuses on inter-connecting the present 25 PostalBank branches to the approximately 1,900 post offices nationwide, so that, together, they will create the biggest network in the country offering both postal and financial services.

        Branch expansion is a major corporate objective of the bank in the next five years. To be able to take on the challenge to “broaden access to finance” in the countryside by expanding its network of branches, the bank is now working out its compliance with the capitalization requirements of the BSP, upgrading IT infrastructure and vigorously investing in human capital. With the consent of the Monetary Board and BSP guidance, the following are proposed:

        • Putting up full branches within or near government offices (including GOCCs) to serve their cash and banking requirements, as well as those of their employees. This saves them on administrative cost of running a cash department, at the same time rooting out corruption and inefficiency in the bureaucracy.
        • Setting up branches or 'Partner Banks' alongside postal offices to cater to the financial requirements of the post office clients, and employees, especially on remittances.
        • Establishment of postal offices as 'satellite partners' within a specified perimeter/radius from our regional branches which will concentrate on solicitation and marketing both of deposits and loans. Meanwhile, processing of documents and approval will be carried out at the regional branches which will serve as virtual business centers.
      • Optimum Use of Postal Offices and Other Postal Outlets

        The above-needed collaboration with the PhilPost has been formalized through a long-term Memorandum of Agreement (MOA) between the Management of PPC and PPSB and their respective Boards.

        The following timeline shall be followed:

        • 2011 – pilot testing of PPSB-postal offices tie-ups organizationally and operationally to include IT systems for:
          • remittances
          • deposit generation
          • loan generation
        • 2012 – expansion of the number of postal offices which will comprise the PPC-PPSB network
        • 2013 – 2016 - full coverage of all 1,900 postal offices in the PPC-Postal bank tie-up
    4. Prices
      • Provide competitive rates
      • Act as conduit for ODAs and soft loans from international agencies
      • Solicit grants/soft loans from foreign donations/international funding institutions, and encouraging them to become stockholders
      • Make proposals to these institutions e.g. WB, IFC, JKA, AID, CIDA, Australia, Canada, etc. starting 2012
    5. Communications Plan
      1. Situational Analysis

        There is hardly any formal communications program being followed by Postal Bank. Strategic Plans have not been developed, and there is no implementing structure in place within the bank. Thus, communications activities have largely been ad hoc, and reactive, rather than deliberately supportive of the Bank’s corporate thrusts and objectives.

      2. Strategic Objectives of the Bank’s Communications Plan
        • To provide full communications support to the Bank’s 5-year Strategic Plan
      3. Goals of the PPSB’s Communications Plan
        • Develop a corporate identity for the Bank
        • Create public awareness of the Bank’s existence, its products and services
        • Support the Bank’s marketing and sales program
        • Build-up trust and confidence in the Bank
        • Attract new players, both depositors and clients
        • Position the Bank as the leading government countryside bank in 5 years
      4. Programs and Activities
        • Create public awareness of the existence of the PostalBank among the general public and its special target audiences, e.g.,
          • Government agencies in all branches of government
          • Political leaders, influential stake holders and decision makers
          • Public and private investors
          • Customers and clientele LGUs, National Agencies/ Offices, GOCCs, etc.
          • Business Industry Sector
          • PostalBank and PPC management and employees
        • Develop a distinct and attractive corporate image/ identity of the Bank
          • Logo and catch themes
          • Key characteristics
          • Unique “selling” points
          • Competitive edge
          • Audio-visual materials for presentation, promotion, and other information activities
      5. Action Agenda, Tools, and Channels

        In the development of a corporate image for the Bank

        • Market research to obtain information inputs needed to arrive at the corporate identity for the Bank
          • Review of vision/ mission/ objectives statements of the PostalBank to serve as basis for the logo
          • Consultations with PostalBank, PPC and branch executives and employees;
          • Comparative review of corporate identities of other banks/ competitors
          • If a change or modification in the logo and slogans is deemed appropriate, execution of alternative graphic designs
        • Integration of the developed corporate image/ identity in the bank’s institutional informational materials
      6. In the creation of public awareness of the existence of the PostalBank
        • Development of a Communications Plan to inform the general public as well as special publics, apart the PostalBank in the main office and specially, in the areas where branches are located. In the plan, specific objectives, messages, and channels of communication to be used shall be, e.g.,
          • Advertisements in the tri-media
          • Press releases in newspapers, magazines and other print channel
          • Radio/ TV interviews of Bank Staff
          • Speaking engagements in various public for a
          • Branch visits by Bank Management
          • Participation in various economic conferences
          • Preparation of a newsletter of bank personnel
          • Informative brochures for clients and potential investors
          • Others as opportunities for interaction with the public arise
      7. In supporting PostalBank’s effort towards business generation
        • The programs of the Marketing Group in the Head Office and in the branches in the promotion and sale of the Bank’s products and services requires a communications component that will identify and develop the most effective advertising and sales promotions campaign for the Bank. It shall establish:
          • The most effective advertising message content;
          • The appropriate media to be used. In the branches, for instance, interpersonal communications and dialogues with specific audience/ client sectors could be the most effective vehicle for attracting depositors. In regards to the mass media, radio and social networking could be more potent and could be used as audience reach research establishes it. Speaking to grassroots organizations, such as cooperatives or occupational groups such as teachers, could be effective.
          • The more effective communicators whose assistance could be sought, e.g. political leaders, teachers, priests. This could be tapped for the campaign.
          • Budget considerations, i.e., the amount one needs to spend to get the message across
        • Appropriate advertising and sales materials could be developed based on communication research findings (even informal surveys) that could be conducted with potential customers.
      8. In identifying and implementing the programs and projects which the Bank would implement as part of its service thrust especially in the countryside.
        • This will require information inputs from various resources, e.g., the community environment to be served, LGUs, agencies of government, and the intended beneficiaries.
    6. Governance Improvement Plan (GIP) Human Resources Development and Re-organization

      Situational Analysis

      • The Bank needs to realign and restructure its organization, strengthen the management staff, and develop its employees.
      • There is a need to enhance and inculcate corporate values to create a culture that will support the strategic goals.
      • The capabilities and competencies including attitudes of employees need further development.
      • The working environment should promote career growth, performance-driven recognition and personal well-being

      HR Strategies

      Organization

      • Realign to a flatter and responsive structure
      • Identify the desired business outputs
      • Plan corresponding business processes
      • Structure the organization accordingly
      • Culture

        Inculcate strong and positive corporate values of excellence, integrity, respect, transparency and sense of ownership.

        • Conduct trainings / seminars / activities to develop values
        • Strict adherence to the Bank’s Code of Conduct
      • In all relationships demonstrate a steadfast commitment to:

        EXCELLENCE

        Strive to learn, innovate and grow to achieve the highest ideals of public service.

        INTEGRITY

        Deal honestly and fairly with the public and with one another by practicing the highest ethical standards, honoring our commitments, and taking personal responsibility for our actions, realizing the fiduciary nature of banking operations.

        RESPECT

        Value our self-dignity, our name, as well as each other’s differences and unique contributions so that we may enrich the well-being of everyone.

        TRANSPARENCY

        Commit not to accept any form of payment from customers and suppliers in exchange for favorable considerations that may be interpreted as an attempt to encourage favorable treatment from the Bank and any of its directors, officers and employees.

        SENSE OF OWNERSHIP

        Commit to give ourselves wholeheartedly to the Bank, to create value and put value to our work to benefit the organization where we belong.

      • People

        Develop the managerial and technical competencies within a working environment that promotes career growth, performance-driven recognition, and personal well-being

        • Training and Development Programs
          • MANAGEMENT DEVELOPMENT TRAINING
            • Leadership Training
            • Supervisory Development Training
            • Personality Development
          • SKILLS TRAINING
            • Customer relations
            • Credit processes and financial analysis
            • Problem-solving and Decision making
            • Project Management
            • Marketing Skills for Bank Officers
            • Technical Writing
            • Information systems management program
          • COMPLIANCE TRAINING
            • Corporate Governance
            • Bank Orientation
            • AMLA/Security/BCP/Policies
            • Values formation
            • Gender and Development
          • LEARNING/TRAINING PROGRAM FOR ISTMG, FUNCTIONAL MANAGERS AND PROFESSIONALS, AND IT INTERNAL AUDIT
            • Supervisory Skills for High Group Performance
            • Computer-based Project Management
            • Information Systems Planning and control
            • Risk Assessment
            • Business Continuity Planning
            • Information System Control and Auditing
            • Technical Writing and Presentations
            • Leadership Development Program
            • Problem Solving and Decision Making
        • Performance Management
          • JOB EVALUATION SYSTEM

            Purpose: To determine the value of one job in relation to that of the other jobs within the family and across functions in the organization so that an equitable salary structure be established.

            HR will advise managers about the policy guidelines on job evaluation, the process to undertake, and the responsibilities of each unit as well as the standard forms and agreed timeline. Managers will evaluate the jobs within their units, accomplish the forms and comply with the timeline. HR will review the submitted job evaluations and make the necessary recommendations to the Management Committee.

          • PERFORMANCE EVALUATION SYSTEM

            Managers will assess the individual contribution of their staff as against the overall performance of their unit on a semi-annual basis and make recommendations on personnel movement, if any.

            HR will review based on the policy guidelines and make necessary recommendations to the President & CEO.

          • SURVEYS

            HR will conduct wage surveys within the thrift banking industry, and adopt to the organization, if applicable.

        • Compensation / Benefits Program
        • Succession Planning
      • Manpower Plan

        Most of the senior personnel have been realigned and promoted from within second-in-line officers. This shall be a continuing exercise that the Bank will practice to motivate the management staff.

        The existing manpower complement shall be utilized and their capabilities maximized by multitasking and assigning functions to capable personnel without sacrificing internal controls.

        This manpower plan will determine the staff requirements of the Bank to meet the challenges presented by the competitive environment and to support the organization’s 5-year strategic plan. Additional manpower shall be hired as fiancés will allow.

        Table 3. Additional Manpower Complement 2012-2016)
        YearNo. of Heads
        201522
        20138
        201489
        201566
        201657

        See Annex D – Details of the Additional Manpower Complement from 2012-2016

    7. Manual of Policies and Operations

      The following have already been accomplished and/or are in the process of being accomplished in connection with the business improvement plan required by BSP:

      • Of the 15 manuals required of banks, the following has been updated and completed:
        TitleStatus
        1.) FCDU ManualCompleted
        2.) Operations Audit ManualCompleted
        3.) Security ProgramCompleted
        4.) AMLA ManualCompleted
        5.) Manual of Lending Operations (MOLO)Completed
        6.) Codified Approving Authorities (CASA)Completed
        7.) Treasury Manual Policies and ProceduresCompleted
        8.) Product Manual of the Bank Completed
        9.) Policy on Employee BenefitsCompleted
        10.) Information Technology Strategic PlanCompleted
      • The following are in process/ being updated and completed per schedule below:
        TitleDate of SubmissionStatus
        11.) Risk Management Manual07 Dec 2011For updating/ revision
        12.) Accounting Systems Manual31 Dec 2011For updating/ revision
        13.) Manual of Cash and Deposit Operations05 Dec 2011For updating/ revision
        14.) IT Operations Management Manual30 Dec 2011For updating/ revision
        15.) Information Security Policy Manual of the Bank28 Feb 2012For updating/ revision
        16.) Manual on Legal Risks30 Jan 2012For updating/ revision
      • On top of the said manuals, the following are being updated and completed:
        TitleDate of SubmissionsStatus
        17.) Business Continuity Plan (BCP) - Disaster Recovery Plan (DRP)30 Jan 2012For updating/ revision
        18.) Information Technology Policies and Procedures
        1. Planning for IS
        2. Project Management
        3. Systems Development and/ or Acquisition
        4. Change Management
        5. 30 Mar 2012 For updating/ revision
        30 Mar 2012For updating/ revision
    8. Vibrant and Responsive Information Technology System

      (INFORMATION SYSTEMS AND TECHNOLOGY MANAGEMENT GROUP (ISTMG) PLAN – 2012 to 2016)

      • Role of ISTMG

        To guide and assist the Bank leadership in achieving its strategic goals and operational objectives by providing authentic, timely and updated information in order to improve its decision-making to solve problems and exploit opportunities.

      • ISTMG Strategic Goals
        • Utilize available information systems and technologies to improve the capability of the Bank leadership (through a bank-wide MIS) and functional management (through innovative, efficient and effective IS and IT application systems).
        • Continually train and develop Bank managers and key professionals (particularly of ISTMG) in effective IS and IT learning, innovative application of IS and IT in their functional areas, and to grow in their respective career paths.
        • Continually improve the ISTMG functional and internal processes to become one of the Bank’s core competencies in order to gain competitive advantage in the banking industry.
      • ISTMG Operational Objectives
        • Strengthen the management and professional capability of the ISTMG to appropriately guide and assist the Bank’s leadership and functional managers in achieving their 2012 operational objectives.

        • 2012 Action Items:
          • Finalize the ISTMG Strategic Plan with annual Operational Plans for each year of the Strategic Plan.
            • “Failure to apprise the Board on the status of approved IT business plans and strategies” (Ref: BSP Findings / New Exceptions – 31 May 2011)
            • “IT strategic plan may no longer reflect current strategic thrust for IT resources” (Ref: BSP Findings / New Exceptions – 31 May 2011)
          • Re-organize the ITD into the envisioned ISTMG functionalities.
            • Establish the Information Security Office
            • Establish the ISTMG Help Desk
            • Establish Project Management Office
            • Transfer of System Documentation Office (from Corp Planning) to ISTMG
            See Annex E - Attachment 1. Proposed ISTMG Organization
          • Recruit through permanent and outsourced hires the position “gaps” between the present and planned ISTMG organization.
            • “Hire / appoint the Information Security Officer” (Ref: BSP Findings / Previous Exceptions – 31 May 2011)
            • Outsource Project Managers
          • Establish policies and guidelines to improve the current IS and IT functional processes particularly in project management, application systems development and implementation, sourcing and acquiring IT resources, security and contingency planning, and coordination relationship of the ISTMG with the Bank’s functional managements and leadership.
            • Develop “IT Risk Management Framework” (Ref: BSP Findings/Previous Exceptions – 31 May 2011)
            • Develop “Business Continuity Plan” (Ref: BSP Findings/Previous Exceptions – 31 May 2011)
            • “Establish standards and procedures for:
              • Systems development
              • Acquisition (of IT hardware, software and services)
              • Project Management”
              (Ref: BSP Findings/Previous Exceptions – 31 May 2011)
            • “Bank-wide IT outsourcing/vendor oversight program, not yet in place” (Ref: BSP Findings / New Exceptions – 31 May 2011)
            • “Perform or engage an independent party to undertake security test of its internal network” (Ref: BSP Findings / New Exceptions – 31 May 2011)
          • Implement a continuing learning, training and development program for ISTMG managers and professionals.
            • “Lack of adequate continuing education programs or trainings for IT personnel and IT auditor” (Ref: BSP Findings / New Exceptions – 31 May 2011)
          • Implement a learning program for the Bank’s functional managers in understanding how ISTMG will communicate, coordinate and work with them in the planning, design, implementation and control, use and administration and other IS and IT requirements.
            • "End-users have limited involvement in IT projects” (Ref: BSP Findings / New Exceptions – 31 May 2011)
          • Assist the IT audit function to improve their capability in auditing the ISTMG so the ISTMG can benefit from their audit assessments in the economical, efficient and effective utilization of ISTMG resources.
            • “Improve IT oversight and operations, and strengthen IT control” (Ref: BSP Findings/Previous Exceptions – 31 May 2011)
            • “Provide sufficient staffing level to effectively carry out IT audit function” (Ref: BSP Findings/Previous Exceptions – 31 May 2011)
            • “Inadequate involvement of the Internal Audit in the system development, acquisition and implementation process” (Ref: BSP Findings / New Exceptions – 31 May 2011)
          • Recommend the establishment of an IS/ITM Committee at the Board level to serve as the Steering Committee and forum for approving and prioritizing ISTMG Projects, allocating Bank resources to these Projects, and resolving strategic issues and concerns in IS/ITM planning and implementation.
            • “Minutes of meetings of Board showed lack of any discussion on IT updates on performance and accomplishments vis-à-vis approved IT business plans and strategies as well as the utilization of approved IT budget. “ (Ref: BSP Findings / New Exceptions – 31 May 2011)
          • Review the functional job specifications of the ISTMG personnel and their current compensation levels and compare/match with the industry standards. Recommend improvements as necessary.
        • Manage the IS and IT components of the approved computer-based applications of the various functional and products/services offerings of the Bank for the Strategic Plan period.

        2012 Action Items:
        • Loans System
        • Accounting System
        • “Delay in the implementation and development of the new online loan and accounting systems” (Ref: BSP Findings / New Exceptions – 31 May 2011)

        • Remittance System
        • Corporate Email
        • HR Information System
        • Corporate Website
        • Management Information System
        • Disaster Recovery set up for other departmental systems
        • AMLA Monitoring System
        • Asset Inventory
        2013 Action Items:
        • Executive Information System

          Review and upgrade (as necessary) the currently installed application systems to improve their currently capabilities in terms of efficiency and effectiveness, and expand their coverage in order to be competitive in the banking industry.

          2012 Action Items:
          • Deposit (CASA) systems
            • “Delay in the implementation and development of online systems and outsourcing of ATM switch to BancNet.
            • Lack of source code escrow agreement for deposit system
            • Weaknesses in logical and administrative access control
            • Lack of a mechanism to monitor activities of network and systems administrators.
            • Back up file management”(Ref: BSP Findings / New Exceptions – 31 May 2011)
            • Network Upgrade / Migration (Alternate Connectivity via IPVPN
          • Review of Other Installed Application Systems

            Table 4. Installed Application Systems

            Equation Banking SystemInformation Technology Department, Cash Dept. and Branches
            Equation Branch AutomationInformation Technology Department, Cash Dept. and Branches
            Prime Banking SystemInformation Technology Department, Cash Dept. and 4 Offline Branches
            CyberLoanLoans Operations Unit & Selected Branches
            ChronoCard Employee BadgeHuman Capital Department
            Real-Time Gross Settlement SystemTreasury Department
            Electronic Fund Transfer Instruction SystemTreasury Department
            ReutersTreasury, Loans and Treasury Operations Department
            Electronic Cheque Clearing SystemClearing Division
            Electra Electronic Financial Transaction SwitchATM Department
            AMLA Reporting SystemInformation Technology Department, Compliance Office, Branches
            IT Helpdesk SystemInformation Technology Department
            Payroll Computing and Payslip SystemInformation Technology Department, Human Capital Department
            Payroll Data Entry SystemInformation Technology Department, Cash and Branches, Branch Clients
            Central Liability SystemRemedial Department
            Loans Ledger SystemLoans Operations Unit, Account Management Department
            Automated Inward Clearing SystemClearing Department
        • ISTMG Resources Requirements
          • Personal Services
          • MOOE
          • Capital Outlay

          Please see Annex E - Attachment 2. ISTMG Budget

        • ISTMG Schedule of Major Activities

          Please see Annex E - Attachment 3. ISTMG Projects / Activity Schedule