week 4 t

Strategic Plan Part II: SWOTT Analysis

Carlos Perez

BUS/475

University of Phoenix

Professor Linda McKee

October 9, 2017

Every business faces a series of Strengths, weaknesses, opportunities, threats, and trends. These are the qualities that help a company or a small business thrive and differentiates it from its competitors. The proposed service was Ally Bank Relationship Banking, which seeks to become the primary provider of financial solutions that build success for our customers by providing a personalized service; however, like any business’ new product or service, the factors that would lead to the success of the service will face competition from other brick-and-mortar banks and/or direct banks (internet banks).

Below is a table of the factors and its Strengths, Weaknesses, Opportunities, Threats, and Trend analysis of the proposed service.

External forces and trends considerations	Strength	Weakness	Opportunity	Threat	Trend
Industry Changes	24-Hour Access to Customer Care and accounts Personalized service with a direct point of contact to an assigned Relationship Banker	Development of new direct banks offering competitive rates or similar customer service	Cater to the banking needs of all generations within the banking industry	Increase in Criminal Activity – personal information is shared through online banking transactions; phishing scams, possibility of online security breach.	Financial Integration – the increase in online banking activity has gained the attention of institutions outside of traditional banking.
Legal and regulatory	Strong compliance team and regulatory audits that have proven the company remains compliant	Relationship Banking requires scrutiny and attention to detail that regulatory requirements are followed for disputes – Regulation E for compromised accounts	Establish partnership with Dispute Resolution Group to handle customer disputes in matters of account takeovers to remain compliant of Reg. E	Legal cost for breaking regulations	Increase, reformed, or amended regulations may cause changes to policies and procedures or system changes and/or updates
Global	Ally Bank has an established image in the United States	Current Team may not be sufficient to handle an increase in future case loads	Market opening for providing an online banking experience while being able to provide a personalized service	Regulations may define the service as private banking and may require a change in policies and processes to accommodate regulatory requirements for private banking	Relationship Banking service will provide deposit growth opportunities
Economic	Improved market conditions will provide competitive rates for deposit accounts	Economic climate determines the interest rate the bank is willing to provide to customers and an increase in compromised accounts may lead to a lack of customer loyalty	Establishing the benefits of banking with Ally Bank the differentiated customer experience of Ally Bank’s Relationship banking	Economic collapse can cause rates to become stagnant or drop An increase in online criminal activity may potentially compromise accounts if systems aren’t constantly updated	Global economic recovery is remaining consistent
Technological	A robust team of software developers and proprietary technologies	Ally Bank has fallen behind companies like Synchrony Bank and Capital 360	Revamp software to cater to all generations	Small startups could develop superior products and capture market share	Mobile devices are becoming far more important than PCs for online banking access
Innovation	Gives Ally Bank a competitive edge	Lack of innovation	To be ahead of the market	Bad ideas	Making an existing product more innovative
Social	Ally Bank’s brand has awards of recognition for partaking in local community activities	Ally Bank’s community support may present a bias view to some customers	Ally Bank aims to establish a strong relationship with the communities that it serves	A lack of community support can lead to a decrease in customer loyalty	Customers are more involved in wanting to know how a bank reinvests in their community
Environmental	Strong history of supporting and reinvesting in the community while encouraging customers to go paperless	Insufficient community support or reinvestment may lead to negative feedback	Show a commitment to environmental friendly initiatives while supporting the communities we serve	Environmental infractions could create media backlash	Consumers place greater importance on environmental initiatives and the company’s values
Competitive analysis	Ally Bank Relationship Banking offers a unique personalized experience	Other direct banks offer the same or similar online banking products	Differentiate from competing brands	Closely related Financial Institutions establishing in the emerging online banking market	Primarily other direct banks and local community banks
Internal forces and trend considerations	Strength	Weakness	Opportunity	Threat	Trend
Strategy	Aggressive strategy will provide rapid growth	Rapid growth could cause investment in new innovations	Continue to build presence in emerging online banking market	Aggressive strategy may be rejected by some cultures	Customers are showing an increasing demand for online banking convenience
Structures	Working on structure and involving employees	Habits	Opportunity to create an organized workplace	Lack of cooperation	Meetings and discussions
Processes and systems	Open to new processes and systems	Adjustment time needed	Organization and efficiency	Lack of follow through	Employee involvement
Resources	Ally Bank has a highly developed network of resources and capital	Skillful staff choose to work for other Financial Institutions	Improve benefits to attract skillful and talented employees	Poor performing projects could reduce available capital	Ally Bank has a stable cash flow and capital structure
Goals	Increasing development goals	Not setting enough goals	Create opportunities to achieve objectives	Not settling proper goals	Training on goal setting
Strategic capabilities	Many people with knowledge of business	Communication	Increasing company success	Poor planning	Developing strategic marketing and business plans
Culture	Ally Bank has created a culture on doing the right thing with its main focus on the customers’ financial well-being	Culture and employee happiness lags behind Synchrony Bank and Capital 360	Improve company culture to help attract quality human resources	Failure to keep employees happy could result in widespread job dissatisfaction	The company has made continual effort to maintain a high level of organizational culture
Technologies	Optimized efficiency for online banking transactions	Technology still requires significant human capital	Automation to cut down on manual labor/back office needs	Competitors may develop/acquire technology at a faster pace	Technology is decreasing in cost
Innovations	Social media marketing in place to build customer loyalty	Competitors are offering similar products at slightly higher rates	Two-factor authentication for increased account security	Negative media coverage could spread on social media	Customers prefer products that provide higher savings/competitive interest rates
Intellectual property	Ally Bank is recognizable in the U.S.	Previous Ally brand is associated with failed brands such as CMG and economic hardship such as GMC’s 2008 bailout	Increase awareness of Ally Bank’s banking product quality and its benefits	Use of brand and/or products by brokerage firms without legal recourse	Internet makes it possible to market the brand rapidly
Leadership	Established leadership team has decades of experience	The company is publicly traded	Remain consistent when catering to customer market demand based on generation	Losing a key member of the management team would be negative for the strategic plan	Ally Bank’s leadership is well compensated and stable

Identify economic, legal, and regulatory force and trends

Ally Bank, like any other bank generates its rated based on the economic climate. Legal and regulatory changes can, however, impact the current rates, but market conditions can also play a role in rate changes. Regulations such as Regulation DD and the Truth In Savings Act require all banks to disclose fees, deposit agreements, interest rates, Annual Percentage Yield (“APY”) and so forth. Customers are now looking for banks that are willing to be transparent and compliant of regulatory requirements.

Additionally, many existing and new customers have become rate shoppers and self-educated on savings products through the use of the internet; the internet provides a means to meet the customers’ demand in an online banking environment and market.

Critique how well the organization adapts to change

In an effort to remain competitive, Ally Bank has become adaptive to constant and consistent market changes. Through the use of customer surveys, we are able to utilize the feedback provided by our customers to increase our customer service and efficiency. Our customers’ feedback has also provided areas of opportunities to meet our customers banking needs or the trending market demand for innovative, securer, and convenient online banking tools, systems, and interactions.

Analyze and explain the supply chain of the new division of the existing business. Share your plans to develop and leverage core competencies and resources within the supply chain in an effort to make a positive impact on the business model and the various stakeholders.

Ally Bank’s Relationship Banking will depend on partnership with other divisions within the company, primarily a partnership with the Disputes Resolution division; this group processes customer disputes, provides provisional credit, monitor the research and investigation of disputed transactions under Regulation E and the Visa and Mastercard rules, and maintains compliance regarding Regulation E disputes. During matters of account takeovers, Disputes would process the provisional credits as stipulated under the guidelines set forth by Reg. E.

Additionally, to developing a partnership with Disputes, Relationship Banking will also require a division partnership with New Accounts for the processing of new accounts and Loss Prevention for the research and final decisioning if an incident is indeed a matter of fraud and/or account takeover. A direct partnership with these three divisions would expedite the processing of new accounts, provide efficient and effective customer service, and boost customer loyalty.

Discuss the primary internal organizational considerations for the development of a strategic plan.

Each division operations on a Service Level Agreement (SLA), or turnaround time, based on the division’s processes and procedures. These processes and procedures are based on the analytics of case volumes and cases are worked in the order in which they are received. This SLA was designed to provide all customers with fair banking practices; however, to also remain compliant of the Unfair Deceptive or Abusive Acts and Practices (“UDAP”) in matters of account takeovers or fraud, each relationship banker has been provided access to all three of the division’s systems under the supervision of the division managers.

Identify the major issues and/or opportunities the company faces based on your analysis

The main issue Relationship Banking faces are the increased case volumes within all three divisions and the increasing volume of online scams, such as the Sweet Heart scam, Craig’s List scams, and so forth. This is also an area of opportunity to seek innovative ways to safeguard our customers’ personal and account information by providing online tools on how to circumvent potential risks and providing the necessary Anti-virus software to our customers free of charge.

Conclusion

Evaluating and understanding the internal and external factors that affect Ally Bank is important. Developing proper business and marketing plans will allow the company to become organized and will assist with increasing Ally Bank Relationship Banking’s ability to meet objectives. Utilizing the SWOTT table will allow Relationship Banking to address the main issues and opportunities that the company faces. The company has many strengths and opportunities that indicate a high level of success; however, the weaknesses need to be addressed in order to ensure success.

References

David, F. R., & David, F. R. (2016). Strategic management concepts: a competitive advantage approach (16th ed.). Boston: Pearson Education.
The Effects of Online Banking. (n.d.). Retrieved October 09, 2017, from http://smallbusiness.chron.com/effects-online-banking-3449.html