Memo to Don Parcell
FFB Situation
Briefly, First Fidelity had been growing up for the past 30 years, changed by reorganisations, acquisitions, and mergers. As a large corporation, it has been called First Fidelity Bancorporation (FFB) after major expansion in 1980s. However, FFB’s performance was decreasing during late 1980s, where stock price was dropping below its book value. Historically, there was also a large asset write off during 1989. Knowing these problems, management team was all replaced after February 1990. Now, as a holding company for 8 independent banks, FFB has 500 branches with $28 billion asset value.
Key Problems
Knowing the problems of FFB, major changes are implemented starting April 1990 to increase operational efficiencies. In March 1990, 10 percent arbitrary cut has been made from the operating expenses and staff costs. For example, treasury operations combined to the responsibility of one person, physical processing sites combined to fewer units as a service, and Trust operations are under control of central management. However, problems still existed having each bank is processed as a stand-alone entity with tailored software application set, complimented …show more content…
This will need a legal specialist from the internal company side reviewing the contracts. Banking services outsourced will only be the Commodity Type Functions and its resources as it need flexibility and scalability for future changes. Stand Alone Products efficiency will be increased with the organizational structure changes. As customers’ data is sensitive for banks, application building and data centre will be owned by the company, but maintained by the vendors. As major changes happened for the bank, including internal operational structures, taking the vendors as a partner will make the changes easier with more
FFB Situation
Briefly, First Fidelity had been growing up for the past 30 years, changed by reorganisations, acquisitions, and mergers. As a large corporation, it has been called First Fidelity Bancorporation (FFB) after major expansion in 1980s. However, FFB’s performance was decreasing during late 1980s, where stock price was dropping below its book value. Historically, there was also a large asset write off during 1989. Knowing these problems, management team was all replaced after February 1990. Now, as a holding company for 8 independent banks, FFB has 500 branches with $28 billion asset value.
Key Problems
Knowing the problems of FFB, major changes are implemented starting April 1990 to increase operational efficiencies. In March 1990, 10 percent arbitrary cut has been made from the operating expenses and staff costs. For example, treasury operations combined to the responsibility of one person, physical processing sites combined to fewer units as a service, and Trust operations are under control of central management. However, problems still existed having each bank is processed as a stand-alone entity with tailored software application set, complimented …show more content…
This will need a legal specialist from the internal company side reviewing the contracts. Banking services outsourced will only be the Commodity Type Functions and its resources as it need flexibility and scalability for future changes. Stand Alone Products efficiency will be increased with the organizational structure changes. As customers’ data is sensitive for banks, application building and data centre will be owned by the company, but maintained by the vendors. As major changes happened for the bank, including internal operational structures, taking the vendors as a partner will make the changes easier with more