1. Strategic Management Project
Iryna Trygub
Amit Shroff
Alex Downs
Prasanna Gopalan
Hanqian Liu

2. Background
Global leader and international provider of financial services and investment resources
Worldwide assets under management was $999.8 billion
Customer accounts was 67.6 million
Worldwide number of employees was 35.2 thousands

3. Multidivisional Structure

4. Characteristics of the Organizational Structure
Complex structure
vertical differentiation
Relatively flat structure
Wide span of control

5. Characteristics of the Organizational Structure
Decentralized approach High level of differentiation
Highly complex forms of integration mechanism

6. Fidelity Brokerage Company

7. Geographic Structure
8 regional centers in 7 states: Smithfield, RI; Boston, MA; Western Region; New York city; Southwest Region; Marlborough, MA; Merrimack, NH; Midwest Region.
International affiliates in 24 countries on 5 continents

8. Corporate Culture Stimulates friendly communication
Supports a flexible, high-performance working environment, in which creativity and innovation are rewarded

9. Norms and Values
Building partnerships among internal customers and employees to provide effective services and solutions
Re-engineering business and technology processes to improve customer responsiveness and profitability of the company
Selecting and developing employees who are committed to excellence
Providing an environment where excellence is fostered, recognized and rewarded

10. Rewards
Individual reward
Group reward

11. Individual Rewards Bonuses Profit Sharing Promotions
Educational Benefits
Non-Monetary rewards

12. Strategic Controls Financial Control Output Controls
Behavioral Control

13. Financial Control
Stock price
Return on Investment

14. Output Controls
Benchmarking
Analysis of customer survey

15. Behavioral Control
Operating Budget
Standardization

16. Improvements
Fidelity needs to look at how the changing market conditions

17. Improvements Adjust Structure of Fidelity Globalization Deregulations
Changes in information technologies

18. Improvements Adjust Reward System of Fidelity Subjective standards
Long term reward system

19. Obstacles to Change
Repositioning strategy
Private ownership

20. Repositioning Strategy
“In personal Investments, we developed a number a new brokerage services, and strengthened our commitment to the high net worth customer. This is essential at a time when our competitors are providing more and more specialized services to reinforce their ties with this important group of investors. At the same time, we must reaffirm our long-term commitment to all categories of investors, no matter what their net worth.” Chairman's letter 2000 annual report .

21. Repositioning Strategy
“I want us to be seen as what we are becoming – a firm that can provide solutions for customers across their whole range of financial needs.”
Chief Operating Officer Robert L. Reynolds

22. Repositioning strategy
Fidelity has not clearly defined their vision.
Why Good Companies Go Bad
By Donald N. Sull
Active inertia
Need to act appropriately

23. Private Ownership Expand globally Fidelity – 24 countries
Merrill Lynch – 44 countries
JP Morgan – 50 countries

24. Example
Fidelity developed the “Private Wealth Management group” in March of 2000.
Merrill Lynch “Private Client Group” 20,200 Financial Consultants in nearly 1000 private client offices in 34 Countries.
This Merrill Lynch group has grown at a compounded annual growth rate of 15% over the last 5 years and has over $1.5 trillion dollars under management.

25. Conclusions Repositioning strategy Vision Write a mission statement
Don’t try to be the best at every thing. Build on core competencies.

26. Conclusions Private ownership Expand globally
Borrow at AAA credit rating, or go public to raise capital