Bank of Montreal 2003 Annual Report Download - page 22

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BMO Financial Group 186th Annual Report 200318
Enterprise-Wide Strategic Management
Developing a specialized competency in strategic management
has been an important priority for BMO. Strategies are developed
at the line of business level and, in turn, support operating group
and enterprise level strategies. The results of these efforts are
presented in the Operating Group Review in the Financial Per-
formance Review section of this MD&A.
Strategic management includes coordinating standards and
activities related to establishing corporate targets and develop-
ing and updating strategies (including financial and strategic
commitments). It also includes optimally employing resources,
tracking and managing performance against commitments and
linking compensation to performance. Operating in accordance
with these strategic management standards helps ensure we
focus on the highest-value strategic issues.
Strategic management governance includes regular updates
of group and line of business strategies, with oversight by the
Office of Strategic Management and approval by BMO’s Manage
-
ment Board Executive Committee and Board of Directors
(where
appropriate). In addition, the Board and Management Board
Executive Committee meet to discuss group strategies and enter
-
prise priorities at an annual Board Strategy Session.
Enterprise-Wide Strategic Management
Rose M. Patten
Senior Executive Vice-President, Human Resources and Head, Office of Strategic Management
“Successfully forging the links between people, strategy and performance will distinguish us as an employer
of choice and a high-performance company. Our focus is on matching people to key roles and keeping them
rewarded and engaged through a clear set of values to which we are all held accountable.”
Vision
To be the best financial services company, wherever we choose to compete.
Strategic Milestones
▪
Achieve top-tier customer loyalty among personal and commercial customers
in Canada.
▪
Achieve the number one market share in business banking in Canada.
▪
Maintain leading investment banking positions in Canada and further build
out our mid-market capabilities in the United States.
▪Build out our franchises in the prime wealth markets in the United States.
▪Become the leading bank in the Chicagoland communities we serve.
▪Maintain market-leading risk management capabilities.
▪
Enhance leading positions in talent management, performance alignment,
diversity and employee engagement.
Progress in 2003
▪Commercial customer loyalty scores improved; however, relative rankings
for both the personal and commercial segments remain below average.
Significant initiatives designed to improve our sales and service capabilities
are underway and will help drive the desired improvements in customer
loyalty going forward.
▪
Market share of business lending below $5 million increased to 19.60%
from 19.48%, narrowing the gap relative to the market leader.
▪Ranked Top Overall Research Team for the 23rd consecutive year; advised
on more Canadian mergers and acquisitions transactions and led or co-led
more Canadian corporate debt transactions than any other investment
bank; and acquired Gerard Klauer Mattison (an equity research, sales and
trading firm) to complete Harris Nesbitt’s product suite in the United States.
▪
Acquired the financial planning firm of Sullivan, Bruyette, Speros & Blayney
and selected assets of myCFO to further strengthen our U.S. wealth
management offering.
▪
Deposit growth of 8% versus a target of 5%, and loan growth of 25%
versus a target of 15%.
▪
Five-year average loan losses of 40 bps versus an average of 59 bps for
our Canadian peer group competitors.
▪For the second year in a row, named a “Top 100 Employer” (the only bank
on the list) and a “Training Top 100” (the only Canadian firm on the list)
and ranked in the top 10 of the “Best 50 Corporate Citizens”.
Strategy and Objectives
Our strategy is to be a top-performing transnational financial institution that operates broadly in Canada and through significant focused franchises in the
United States by targeting clients who value personalized service and customized solutions. We focus on delivering our products and services efficiently,
prudently and profitably while investing in strengthening our core Canadian franchise and growing selectively and substantially in retail, commercial
mid-market and wealth management businesses in the United States.
Our strategic objectives are to:
▪
Be leaders in businesses with advantaged capabilities (top-tier profitability and either the leader in market growth or among the top three in market share);
▪
Operate efficiently and grow at market rates in our other core businesses (those that provide steady, sustainable earnings or support advantaged businesses);
▪Minimize or eliminate capital utilized in non-core businesses and invest to shift our capital utilization more heavily toward retail, commercial mid-market
and wealth management businesses.