Read the Scenario below and answer the following questions.

Developments in South Africa`s financial sector have seen new banks being licensed. Besides, retailers such as Shoprite are now offering money transfer services- a thing that was only done by banks before. An environmental analysis of the banking sector has revealed that traditional banks such as ABSA, Nedbank and Standard Bank are no longer as viable as before. This is partly due to the following 3 modern-day issues also affect their business;

(1)Strategic alliances,

(2) Industry regulators (including Unions) and

(3) Global issues.

1. Absa Bank has engaged your strategic management expert services. Provide a detailed explanation how each of the above environmental factors affecting the banking sector.

2. In view of its declining financial and strategic performance, Absa has two strategic options.

Option 1 is that the company adopts a rejuvenation (turn-around) strategy.

Option 2 is that the company exits the market.

Question: Advise Edcon on the different approaches/ initiatives under the two options above. You are expected to present each option separately