Strategic analysis

STRATEGIC ANALYSIS

Wells Fargo and Company have accumulated more than $4 billion in fines due to the scandal of unethical sales practices that blew up in 2016, and is still feeling the effects four years later. To date, the financial institution is still being investigated by federal agencies. Further, “the Department of Justice is looking into whether executives withheld details pertaining to fake accounts to the Wells Fargo board of directors and the Office of the Comptroller of the Currency” (Mosie, 2020, para 1). Despite all the legal issues that plaque Wells Fargo, they somehow have managed to remain financially competitive.

The following three strategic tools will be used in identifying and provide potential recommend improvements for the issues Wells Fargo is currently facing. The first tool used in this analysis is PESTLE, which is an acronym for Political, Economic, Social, Technological, Environmental and Legal issues. This tool “is a framework or tool used to analyze and monitor the macro-environmental factors that may have a profound impact on an organization’s performance” (Business to You, 2016). The PESTLE will provide adequate information pertaining to the political constraints placed on Wells Fargo, describe the economic impact and legal issues.

The second tool chosen for this project is the SWOT analysis. The SWOT, which stands for Strengths, Weaknesses, Opportunities and Threats is an easy tool that provides valuable information to help devise a business strategy. It also complements the PESTLE tool. Finally, in order to establish the competitive advantages or weaknesses of Wells Fargo, the following characteristics - value, rarity, inimitability, and organization (VRIO) will examine the company’s resources (Dyer, Godfrey, Jensen, and Bryce, 2020, p.49).

The following strategic tools were considered for this project but were not selected, Porter’s Five Forces analysis and DESTEP analysis. Both tools provide very good information however, Porter’s Five Forces which works well with PESTLE seems better suited for a distribution or manufacturing company. The DESTEP analysis tool is very similar in comparison to PESTLE in that they both examine the same four principles and the only difference is DESTEP adds demographic and ecological influences.

References

Dyer, J., Godfrey. P., Jensen, R., & Bryce, D. (2020) Strategic management: Concepts and cases

(3rd ed.). Hoboken, NJ: John Wiley & Sons, Inc.

Moise, I., (2020, January 24) Remaining hurdeles fro scandal-hit Wells Fargo. Reuters.

Retrieved from

https://finance.yahoo.com/news/remaining-hurdles-scandal-hit-wells-

184529145.html

Scanning the environment: PESTEL analysis (2016) Retrieved from

https://www.business-to-you.com/scanning-the-environment-pestel-analysis/