SWOT Analysis: Its Uses for Wells Fargo
As noted by Giesen (et al., 2010), one of the most difficult things for any business to know is when and how to alter its core business model. Technology businesses such as IBM have been forced to do this, as the physical product lines on which they based their successes have become obsolete. The consequences of failing to innovate are dire, as seen when the physical video rental company Blockbuster failed to enter the digital age. One popular tool to use in reconfiguring a business model or simply improving a business is that of SWOT, or the strengths, weaknesses, opportunities and threats model.
SWOT is a method of analyzing both internal and external threats. Strengths and weaknesses are particular to the organization, while opportunities and threats refer to the external environment. SWOT can be useful to help a business understand what it does well, and what benefits it offers customers. For example, strengths might include a dominant market position, a lean supply chain, a positive organizational culture, and high levels of customer satisfaction. Weaknesses might include the opposite of all of these things, such as struggling to make projected financial goals, a poor organizational culture riddled with tensions, and an outmoded business model.
Opportunities refer to potential areas in which the business can explore to capitalize upon its current model. “Every organization needs to review carefully whether the time is right to revisit its business model, either to pursue new opportunities in its industry or to respond to competitive or technology threats posed to its existing model” (Giesen, et...…was a clue not only of internal weaknesses, but a sense that the goals the business had set for itself, in terms of real, ethical opportunities, could not be sustained. Still, the fact that Wells Fargo did not become embroiled in the 2008 banking scandal and has remained the 4th largest banking chain has enabled it to capitalize upon its strengths to weather the scandal (Streeter, 2019). A number of industry analysts have attributed this to the fact that its digital banking is so strong, and it “has 30 million digitally active customers — about 43% of its total customer base” (Streeter, 2019, par.1). This is an example of how using SWOT analysis can help even a struggling company identify its strengths (and vice versa) and offer guidelines about how to move forward, even during…
References
Giesen, E., Riddleberger, E., Christener, R., & Bell, R. (2010). When and how to innovate your business model. Strategy & Leadership, 38(4), 17-26.
Streeter, B. (2019). What banking’s future looks like to Wells Fargo’s innovation chief. The Financial Brand. Retrieved from: https://thefinancialbrand.com/89994/banking-future-wells-fargo-innovation-digital-ai-platform-blockchain/
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