Strategies Wells Fargo can use to GROW from a Billion-Dollar Company to a Trillion-Dollar Company like Alphabet Inc
Wells Fargo & Company is an American global economic and financial services corporation that operates in 35 countries and has over 70 million clients worldwide.
The company is headquartered in San Francisco, California, with head offices in Manhattan and management offices all across the United States and worldwide.
The company’s primary subsidiary is Wells Fargo Bank, N.A., a national bank established in Wilmington, Delaware, with its main office in Sioux Falls, South Dakota. Wells Fargo in its current form is a result of a 1998 partnership between the old Wells Fargo & Company and Minneapolis-
The Foundation of Wells Fargo Company
Wells Fargo was established in 1852 by Henry Wells and William G. Fargo, who played a huge role in creating American Express alongside John Butterfield. Their aim was to provide “express” and banking services to California, which was expanding rapidly due to the California Gold Rush.
Its first and most essential functions were conveying gold from the Philadelphia Mint and “express” letter delivery that was quicker and less costly than U.S. Mail.
In 1872, Lloyd Tevis, a friend of the Central Pacific “Big Four” and proprietor of the license to operate an express service across the Transcontinental Railroad, became president of the company after purchasing a huge stake, a position he retained until 1892.
John J. Valentine, Sr., a longstanding Wells Fargo employee, was appointed as the president in 1892. Unfortunately, Valentine passed away in late December 1901 and was succeeded by Dudley Evans on January 2, 1902.
Wells Fargo separated its banking and express activities in 1905, and Wells Fargo’s bank combined with the Nevada National Bank to form the Wells Fargo Nevada.
Wells Fargo Nevada combined with Union Trust Company in 1923 and formed Wells Fargo Bank & Union Trust Company. Wells Fargo and American Trust Company combined in 1960 to form Wells Fargo Bank American Trust Company.
However, Wells Fargo American Trust was renamed Wells Fargo Bank in 1962. The company acquired several stakes to become the first major US financial services firm to offer internet banking including; (Table)
- Crocker National Bank from Midland Bank in 1986.
- The personal trust business of Bank of America in 1987.
- Barclays Bank of California from Barclays plc in 1988.
- 130 branches in California from Great American Bank for $491 million in 1991.
- The National Bank of Alaska in 2000.
- H.D. Vest Financial Services for $128 million in 2001, but sold it in 2015 for $580 million.
- United Bancorporation of Wyoming in 2008.
- Century Bancshares of Texas in 2008.
- Merlin Securities in 2012.
The Rise of Wells Fargo Company
In 2009, Wells Fargo ranked 1st among banks and insurance companies, and 13th generally, in Newsweek Magazine’s first “Green Rankings” of the country’s 500 leading companies.
The company created what maintains, the industry’s first blog in 2010 to focus on its environmental stewardship and solicit input and proposals from its stakeholders.
In 2013, the Wells Fargo Company was honored by the EPA Center for Corporate Climate Leadership as a Climate Leadership Award winner, in the discipline “Excellence in Greenhouse Gas Management (Goal Setting Certificate).”
This honor was given to the corporation for its goal of reducing absolute greenhouse gas emissions from its US operations by 35% by 2020 compared to 2008 levels. In 2017, Wells Fargo was ranked 182nd out of 500 in Newsweek Magazine’s “Green Rankings” of the top US corporations.
Wells Fargo launched a proposal in March 2017 to allow smartphone-based transactions using mobile wallets such as Wells Fargo Wallet, Android Pay, and Samsung Pay.
The Pros and Cons of Wells Fargo Company
On July 31, 2009, Illinois Attorney General Lisa Madigan filed a lawsuit against Wells Fargo, claiming that the bank leads African Americans and Hispanics into high-cost subprime loans. A piece of evidence produced in the case indicated that loan officials had referred to black mortgage-seekers as “mud people,” and the subprime loans as “ghetto loans.”
According to Beth Jacobson, a Wells Fargo loan manager interviewed for a New York Times magazine, “We basically went after them. Wells Fargo Mortgage has an emerging-markets unit that deliberately targeted black churches because it believed church leaders had a lot of influence and could persuade members to take out subprime loans.”
Wells Fargo was penalized in August 2010 by United States District Court Judge William Alsup for overdraft practices intended to “gouge” and “profiteer” at the cost of customers, as well as for deceiving customers about how the bank handled transactions and assessed overdraft penalties.
How Wells Fargo Can Improve Their Brand and Revenue
1.) Reduce Fraud
The Wells Fargo account fraud crisis arose as a result of the opening of millions of bogus savings and checking accounts on behalf of Wells Fargo consumers without their
Clients of Wells Fargo became aware of the fraud after being charged unusual fees and acquiring unexpected credit or debit cards or lines of credit. Tim Sloan, who took over as CEO after Stumpf, resigned in March 2019 due to the controversy. Employees at the bank believed these ambitions remained unrealistic as of early 2019.
On May 6, 2018, Wells Fargo began the “Re-Established” integrated marketing campaign to underline the core values of the company towards re-establishing trust with existing and new clients. Roughly a year later, in January 2019, the company announced another revamp of its image, in a campaign named “This is Wells Fargo”.
In May 2017, Wells Fargo announced that it would reduce costs by investing in technology and relying less on its “sales organization.” This improved their stakes and trust, especially with their clients and business partners.
3.) Avoid Fines at all Costs
Wells Fargo has been punished severally as a result of criminal acts. The firm was subjected to civil and criminal proceedings, which contributed to the increase in fines. The company has also been penalized for overdraft tactics aimed to “gouge” consumers and “profiteer” at their expense, and for misleading consumers about how the bank handled transactions and assessed overdraft fees. By avoiding these unwarranted fines, the organization can save funds and increase revenue.
4.) Enhancing Realistic Sales Goals
An investigation by the Wells Fargo board of directors, the outcomes of which were released in April 2017, mainly blamed Stumpf, who was accused of failing to respond to evidence of guilt in the consumer services division, and Tolstedt, who was accused of knowingly setting impossible sales goals and refusing to respond when subordinates disagreed with them.
Wells Fargo invented the expression, “Go for Gr-Eight” – or, in other words, attempt to sell at least 8 items to every customer. The board decided to use a clawback mechanism in Stumpf and Tolstedt’s retirement contracts to retrieve $75 million in cash and stock from the former executives. By promoting real sales goals, the company can win 100% trust from its clients which will in turn increase their transactions and revenue.
Alphabet Inc is an American multinational corporation that was formed as a result of a Google restructuring and became the parent organization of Google and some former Google subsidiaries Alphabet is the world’s third-largest technology company in terms of revenue and one of the most valuable corporations.
The foundation of Alphabet Inc. was influenced by a goal to make the core Google operation “cleaner and more accountable,” while also allowing group firms that operate in industries other than Internet services greater autonomy.