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Company Core Strategy and Structure
Staci Barfield
MGT500 Management
Instructor Dr. Derrick Esplin
November 30, 2022
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Introduction
The last essay talked about what the Bank of America was and what it stood for in the
last essay (Mission Statement, vision, values, corporate responsibilities). As was previously said,
Bank of America is an international company that provides financial services to individuals from
various social and economic backgrounds. This essay will concentrate on Bank of America's
main strategy and how the market structure affects it. The paper will also examine how the
strategy of Bank of America's rivals impacts its short-term operations and how it develops longterm strategies to stay competitive and relevant. The discussion will examine several questions as
it contrasts the Bank of America and the way it is structured, including how the strategies are
similar, how they vary, whether the organizational structure has an impact, and whether the same
environmental factors impact them.
A summary of the company's strategy
Following its general strategy, Bank of America Corporation must increase earnings and
profitability through cost-effective business models and aggressive growth initiatives. The
corporation's business strategy, which incorporates internet banking to preserve competitiveness
via technological advancement, is the foundation for such a business strategy. The general
strategy needs to support Bank of America's objectives for enhancing and growing its
competitiveness (Bank of America, n.d.). Conversely, in a situation of rapid expansion, strategies
should align with the financial services industry's long-term development and related strategic
goals, considering market circumstances involving other companies in a healthy competitive
environment. The business model establishes the corporate framework for carrying out business
strategies and producing value for Bank of America and its clients (Bank of America, n.d.). With
its strategic location as among the largest financial services companies, the business architecture
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provides an example of effective organizational advancement for competitiveness through
strategic planning that incorporates the proper blend of generic and intensive growth strategies.
A competitor’s strategy
The top three competitors in the banking and finance services sectors for the Bank of
America include JPMorgan Chase & Co., Wells Fargo & Company, and Citigroup Inc.
JPMorgan is global banking and holding firm (Donnellan & Rutledge, 2019). The firm is a
significant competitor of the Bank of America in the financial service sector. To strengthen the
four primary cornerstones of opportunity—employment and capabilities, new business
development, community rehabilitation, and financial stability—JPMorgan Chase integrated its
business and policy expertise, resources, and analytics.
Different markets have standards or environmental restrictions that could have an impact
on how profitable a firm is. Within one country, states frequently have varying legal and
environmental requirements (Donnellan & Rutledge, 2019). In the US, Florida and Texas, in
particular, have different liability laws in the case of accidents or ecological degradation. Similar
to this, most European countries provide significant tax breaks to companies operating in the
renewable energy sector (Heart, 2018). Before entering new markets or starting a new operation
in an existing market, the company should carefully evaluate the environmental requirements
necessary to operate in such locations.
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Assessment of both strategies
Similarities in their strategies
JPMorgan and Bank of America are two corporate finance institutions that are increasing
their focus on transactions solutions as digital banking becomes a top imperative. Even while the
bank's rivals in the bubble category were also hit by the decreased trading volumes, the decrease
was not as severe as it was for some of its rivals. JP Morgan has also avoided serious crises and
regulatory sanctions that have beset several of its rivals (CB Insights Research, 2020). Due to
growth within the client financial services and wealth management segments, favorable
economic and regulatory updrafts for the banking industry, noticeably higher interest rates, and
dynamism underneath President Trump's tax plan, JPMorgan enhanced its market capitalization
by over $60 billion in 2017. Amongst bulge bracket institutions, this growth ranked second
highest during 12 months.
Equally, discussing digital banking strategies and technology investment took up some of
Bank of America's Q1 2017 and Q3 2017 earnings calls. The bank invested $2.25 billion in
digital efforts in 2017, according to CEO Brian Moynihan (CB Insights Research, 2020).
Additionally, the bank observes that 1 in 5 deposit transactions are made using mobile devices.
Differences in their strategies
The strategic drivers of inclusive development are at the center of JPMorgan Chase's
impact model, which reflects what they see as the necessary components for generating longlasting effects for its communities, clients, and workers. The company is implementing this
approach by making large, sustained, and data-driven expenditures in global communities (CB
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Insights Research, 2020). For instance, the firm pledges to invest over $150 million within five
years to sustain innovativeness and expand its opportunities.
On the other hand, the Bank of America utilizes an intensive growth strategy. The main
aggressive expansion strategy used by Bank of America is market penetration. The company
wants to increase the sales of financial services in its existing areas with this investment
program. Market development has been crucial to Bank of America's growth and achievement of
its current competitiveness (CB Insights Research, 2020). To ensure the competitiveness
progress of the financial services industry, the company also uses other high-impact growth
strategies, such as market and product innovation.
Impacts of organization strategy on organizational structure
The corporate structure of Bank of America is mostly hierarchical, with a top leadership
team in charge of the firm's expansion and growth. The corporate structure acts as the
overarching design and architecture that shapes the bank's business services operations and
specifies divisions of resources and activities (Paramio-Salcines & Llopis-Going, 2022). Due to
Bank of America's scale and international network, the organization needs a structural
framework that can adapt to changes in the global market. A history of mergers and acquisitions
with other financial firms has impacted the type of corporate structure the corporation currently
possesses. Further M&A may therefore result in alterations to the existing structural architecture,
but Bank of America's generic strategy for competitiveness and intensive growth tactics have
mainly stayed constant over time.
The organizational structure supports the organizational strategy of JPMorgan firm. The
market division of JPMorgan Corporation is transforming to provide a seamless digital
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experience. All of their client's needs are considered when designing digital solutions. In order to
create differentiated, personalized experiences at scale, for instance, the company is investing
(JPMorgan Chase & Co., n.d.). This will speed up time to market, increase customer satisfaction,
save costs, and use common platforms and capabilities.
A better strategy
While both strategies employed by the Bank of America and JPMorgan firms have
considerable benefits to respective organizations, JPMorgan's strategy is more effective as it
targets to enhance its pillars of opportunity: jobs and skills, small company expansion,
community rejuvenation, and financial health (Heart, 2018). It combines business and policy
knowledge, capital, and analytics (JPMorgan Chase & Co., n.d.). Through the expansion
strategy, J.P. Morgan is renowned for taking control of companies and restructuring them to
create them more sustainable and lucrative.
How to improve corporate strategy at the Bank of America
However, there has been fierce rivalry from other businesses for The Bank of America.
The company must reconsider its culture, strategies, and risk management procedures in light of
a recent modest decline in profitability. The culture of the company needs to be altered to be
more inclusive. In order to strengthen a worker's ability to adapt to market changes, regular
retraining and alignment should be included. There are numerous uncertainties in the finance
sector (Paramio-Salcines & Llopis-Going, 2022). Therefore, the company must implement
innovative loss-reducing tactics. The initiatives will also assist the company in capitalizing on
market trends.
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References
Bank of America. (n.d.). Bank of America's ethical business
practices. https://about.bankofamerica.com/en/our-company/business-practices
CB Insights Research. (2020, June 26). JPMorgan Chase competitive strategy Teardown: How
the bank stacks up on Fintech and
innovation. https://www.cbinsights.com/research/jpmorgan-chase-competitive-strategyteardown-expert-intelligence/
Donnellan, J., & Rutledge, W. L. (2019). A case for resource‐based view and competitive
advantage in banking. Managerial and Decision Economics, 40(6), 728737. https://doi.org/10.1002/mde.3041
Heart, L. B. (2018). JPMorgan chase, bank of America, Wells Fargo, and the financial crisis of
2008. International Journal of Business Communication, 55(2), 237260. https://doi.org/10.1177/2329488417753952
JPMorgan Chase & Co. (n.d.). Small business
expansion. https://www.jpmorganchase.com/impact/our-approach/small-businessexpansion
Paramio-Salcines, J. L., & Llopis-Goig, R. (2022). Key strategic decisions and their influences
on the management and success of the bank of America Chicago Marathon and the
marathon Valencia Trinidad Alfonso. International Journal of Financial Studies, 10(3),
74. https://doi.org/10.3390/ijfs10030074
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Managing Strategies
Staci Barfield
MGT50 Management
Dr. Derrick Esplin
December 13, 2022
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Implementing a formal performance evaluation process
The Bank of America, like any other company, would be foolish not to have some kind of
formal performance review procedure. It's a typical dilemma among business leaders. Managers
are aware of the need of providing workers with feedback and the potential benefits of doing so
for improving performance and output (Ali & Anwar, 2021). Nevertheless, the majority of
managers and many workers are unhappy with the current performance management system
procedure. That might be accomplished by adopting a pay-for-performance mindset in which all
employees are compensated fairly regardless of their level of performance. Equal compensation
for equal labor may also be ensured by conducting regular evaluations, under the watchful eye of
the Board and other top executives, and enforcing rules and procedures that uphold this principle.
For over a decade, I have spoken with compensation specialists before making year-end
compensation choices and adjusted compensation as needed.
Reward system
The incentive plan would consist of giving the worker something they want right after
they do it. The impact of the award is contingent on time. When a reward is given too late after
an employee has completed an accomplishment, it loses some of its power to influence future
actions. Rapidly acknowledge and reward good achievement. When workers are adequately
compensated and satisfied, they are more likely to remain with the firm. This is why a
comprehensive compensation package is so important. Staff retention may be improved by
competitive pay and benefits (Communication and Perception, 2012). The absence of employee
turnover due to loyalty saves businesses time and resources. Employers that invest in building a
competent staff see lower turnover and more stability in their workforce. Also, they are dedicated
to the group and perform a good job as a unit. Paying employees fairly demonstrates respect for
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them as individuals and as workers. When employees believe their contributions are being
recognized, they are more enthusiastic about going to work. People are more enthusiastic about
coming to work and doing their best, and the firm as a whole benefits (Ali & Anwar, 2021). In
addition, the promise of financial incentives like commissions or bonuses may spur workers to
achieve even greater success. Plans for additional income based on achievement, such as bonuses
and commissions, rise to the forefront of the workforce.
Rolling out and managing the change process
Businesses need to develop and adapt in order to roll out and manage the change process
in response to a wide range of threats, including advances in technology, the emergence of new
rivals, changes in government regulations, and even fundamental shifts in economic patterns.
Stagnation, if not failure, might result from failing to take this step. I would;
Prepare the Organization for Change
A company's preparedness to explore and implement change depends on its current state
of preparation on both a practical and cultural level. Culture readiness is the first step to taking
your company to the next level, before you even think about logistics. At this juncture, the
manager's first priority should be to win over the support of the team members who will be
affected by the impending change (Ammad khan, 2016, February 3). They highlight the many
problems the firm is having, which are contributing to the present climate of dissatisfaction.
Craft a Vision and Plan for Change
It is the responsibility of upper management to implement change when it is evident that
workers are ready to do so. The strategy needs to describe: Long-term plans: When it comes to
the organization's long-term objectives, how exactly will this new policy help? Statistically
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Significant Metrics: To what extent will we evaluate our success? What adjustments should be
made to the metrics? Where should we start when assessing the present state of affairs?
Implement the Changes
Once the strategy has been prepared, all that remains to be done is to implement the
measures outlined within it to achieve the intended outcome. Depending on the specifics of the
project, various adjustments may need to be made to the organization's structure, strategy,
systems, processes, staff habits, etc.
Embed Changes within Company Culture and Practices
After a successful change initiative is completed, the status quo can no longer be
reinstated without the intervention of a change manager. This is crucial for any kind of business
process-related transformation, including new workflows, cultures, and strategies.
Review Progress and Analyze Results
It's possible that not all successful transformation projects really were. Organizational
leaders may get insight into whether or not a change effort was successful by conducting a
"project post mortem" to evaluate and assess the initiative's outcomes. In addition, it may provide
useful information for future attempts to bring about change.
Strategy in managing the change
In order to manage the change, I would use the following strategy;
Work with a change management model
Leaders face a number of challenges while trying to execute change, including the
company's established standards, the organization's momentum, and the psychology of the
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individuals involved. They need efficient means of bringing about transformation. Using change
management models to connect business strategy to action may help leaders increase their
chances of success. Change management frameworks abound, with names like Prosci's ADKAR,
Lewin's, and Kotter's all making appearances. While there is some variation across the various
models, they all have the common ground of focusing on what's lacking and making a strategy to
fix it. Beehive has chosen Prosci's change management model because it: emphasizes the
function of communication in change; integrates the psychology of individual and organizational
change; and has a worldwide foundation of more than 20 years of study.
Transparency in communication
I would be absolutely transparent in communicating with all members of the organization
while at the same time keeping some of the compensation information confidential. This is due
to the fact that leaking sensitive company information may have devastating effects on the
company and its stakeholders if the information isn't kept secret (Seeker, 2013). But for the sake
of the organization and its stakeholders, it is important that its inner workings be made clear.
Therefore, it is essential that the organization maintain a delicate equilibrium between privacy
and openness. The management of the company has to adopt a principled stance, one that
recognizes and understands conceptually that privacy and openness are distinct but
complementary goals.
Roadblocks to organizational change
Improperly assessing the difficulty of transitioning to new circumstances
Complex issues may have hitherto unsuspected difficulties. It's possible that we'd be
helpless in these circumstances if we had the necessary expertise, advice, or strategy. When
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dealing with change, it's important to be flexible enough to make course corrections if things go
awry.
Insufficient responsibility
Managers and frontline staff alike should be incentivized to take part in the transition.
That way, they'll take ownership of the result and develop a strong feeling of personal agency.
Open-door policies, regular town hall meetings, and anonymous surveys are just a few of the
methods that upper and middle management can use to encourage employee participation.
Expecting a smooth transition
Realize that many obstacles will be in the way of the change, and that overcoming them
will be difficult. Those at the top of an organization don't always realize how much their
decisions will affect those lower down the chain of command (Tiron-Tudor e al., 2021). Little
thought is given to the implications of a resistant corporate culture or the allocation of new
resources.
Misguided organizational structure
Managers, team captains, and frontline employees all need a forum where their voices
can be heard. A cross-departmental group working in tandem with higher-ups is one possible
structure for enacting such an arrangement.
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References
Ali, B. J., & Anwar, G. (2021). The mediation role of change management in employee
development. Ali, BJ, & Anwar, G.(2021). The Mediation Role of Change Management
in Employee Development. International Journal of English Literature and Social
Sciences, 6(2), 361-374.
Ammad khan. (2016, February 3). Chapter 8 Performance Management and Appraisal.
Slideshare.net. https://www.slideshare.net/Ammadkhan6/chapter-8-performancemanagement-and-appraisal
Communication and Perception. (2012). Lardbucket.org.
https://2012books.lardbucket.org/books/a-primer-on-communication-studies/s02communication-and-perception.html
Seeker. (2013). The Big 5 Personality Traits. In YouTube.
https://www.youtube.com/watch?v=oWpRKJPCI7M
Tiron-Tudor, A., Deliu, D., Farcane, N., & Dontu, A. (2021). Managing change with and through
blockchain in accountancy organizations: A systematic literature review. Journal of
Organizational Change Management.
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