Wells Fargo & Company (simply known as Wells Fargo) remains one of the most respected brand names in the global finance industry. It is currently a revered “financial services holding company” (Wells Fargo, 2016, para. 3). The company’s human resource (HR) practices are critical towards empowering more workers. However, there are specific gaps that make it impossible for the HR leaders to align employee performance with the firm’s strategy. Competent leaders should be recruited to implement a new change whereby the firm aligns the current HR practices with its business strategy. This new development will ensure the employees focus on the mission to support the firm’s business strategy.
Background Information: Wells Fargo
Company History
Wells Fargo has a long history in the industry. The firm’s website indicates that it was started in the year 1852 by two partners named William Fargo and Henry Wells. The main objective pursued by the new firm was to provide banking products to potential customers in California (Wells Fargo, 2016). Within a period of ten years, Wells Fargo had managed to increase its profits. This growth made it easier for the company to acquire “Overland Mail and Holladay in 1866” (Wells Fargo, 2016, para. 2).
By the year 1950, Wells Fargo had grown significantly to become a leading brand name in the American financial market. In the recent past, this giant corporation has acquired a number of businesses such as American Trust Company, Union Trust, and First Security Corporation (Geisst, 2014). By 2009, the company had established Wells Fargo Securities (Wells Fargo, 2016). Because of its powerful business model, Wells Fargo has continued to attract stakeholders and customers from different regions. This move explains why the firm has remained competitive and successful in the investment banking subsector. With over 265,000 employees, Wells Fargo operates many branches in North America.
Wells Fargo’s Strategy
In order to remain successful, Wells Fargo uses a powerful business strategy guided by its mission and vision statements. These statements are usually aimed at promoting the best business practices that can empower more customers and support their financial needs (Wells Fargo, 2016). On top of that, the corporation uses powerful strategies to support the workers. The employees are equipped with the most appropriate skills, competencies, and resources in order to deliver competent services to the customers. Specific concepts such as teamwork, leadership, collaboration, and decision-making define the company’s business strategy (Geisst, 2014).
Research and development (R&D) is taken seriously to support the firm’s strategy. This approach makes it possible for Wells Fargo to offer superior financial products that can address the changing financial needs of the targeted customers. The firm’s superior products such as “banking, mortgage, and investment support the implemented strategy” (Wells Fargo, 2016, para. 3). Wells Fargo’s global strategy plays a critical role towards ensuring that the targeted products are delivered to the greatest number of consumers. The firm uses its core values to promote specific action plans such as corporate social responsibility (CSR). These approaches work synergistically to define Wells Fargo’s business strategy.
Market Position
Wells Fargo has been operating in a very competitive industry. This is the case because the financial services industry is characterized by giant firms such as Citigroup Incorporation and JP Morgan Chase (Wells Fargo, 2016). Despite the presence of such competitors, Wells Fargo offers superior products to its clients. This practice explains why the firm has remained a revered brand in the industry. However, the firm is “the third-largest in terms of assets” (Wells Fargo, 2016, para. 2). The other important thing to consider is that the firm’s businesses are mainly concentrated in the United States. Its subsidiaries in Europe encounter stiff competition from different companies in the banking industry.
It is agreeable that Wells Fargo is a pacesetter in the industry. However, the company has limited presence in different parts of the world. The competitive rivalry in the sector explains why more companies continue to attract more customers (Wells Fargo, 2016). The industry is also less attractive to new players. However, clients have a wide range of options from the products in the industry. Despite being a successful provider of financial products and services to more customers, Wells Fargo continues to have a limited market share in the United States (Geisst, 2014). The organization has also failed to expand its operations across the globe.
Specific Area of Alignment
Organizational managers should use their skills to create sustainable firms. They can implement a wide range of strategies to achieve this objective. Wells Fargo has been using various strategies such as human resource to empower its workers. The human resource (HR) outlines a number of core principles and values in attempt to guide the employees. By so doing, the firm has managed to drive performance. The “targeted customers find it possible to get quality financial services and support from the corporation” (Sluijs & Kluytmans, 2012, p. 3). However, the firm encounters several challenges such as changing consumer needs, competitive rivalry, diversity, and consolidation in the industry. That being the case, the company must be prepared in order to remain successful in the future.
In order to improve its performance, Wells Fargo should align its HR practices with the current business strategy. As mentioned earlier, the company’s business strategy focuses on the best practices in order to deliver quality financial services to the targeted customers. This strategy is supported by powerful initiatives such as R&D and positive leadership (Wells Fargo, 2016). The current HR department offers adequate inputs in order to support the strategy. Unfortunately, the current HR practices do not align with the firm’s strategy.
This gap can be addressed through the use of a powerful HR strategy. This means that “the HR department should promote something known as performance capability” (Sluijs & Kluytmans, 2012, p. 6). This kind of strategy attracts the right people and equips them with desirable skills in order to improve the existing business processes. The alignment will definitely play a positive role towards making the company successful. The HR department should identify and promote the best behaviors that can promote business performance. The processes should focus on the experience of every customer. The employees should be empowered, guided, and mentored in order to focus on the established organizational processes.
Aligning HR Practices to Business Strategies: Key Steps
Attracting Talent
The main objective is to ensure Wells Fargo implements the best business strategy in a professional manner. This approach will play a positive role towards delivering quality results within the shortest time possible. Before realizing this objective, the firm should attract the right individuals who can support the proposed realignment process. The targeted professionals can be recruited from the existing workforce. These positions include Chief Human Resource Officer (CHRO), Business Strategist, and Administration Officer (Nigam, Nongmaithem, Sharma, & Tripathi, 2011). The three key positions will play a major role towards improving the firm’s performance.
The candidates should receive competitive compensation packages. The occupants of these positions should receive similar salaries and remunerations. This is the case because they possess similar skills and competencies. They will also be required to present their inputs and competencies. The move will ensure the firm’s HR aspects focus on the implemented business strategy. Each position will therefore attract an annual remuneration package of $72,000. Every manager will also receive medical insurance, education cover for his or her children, transport allowance, and an annual leave.
Current and Targeted HR Processes
Currently, Wells Fargo is characterized by a strong HR department that focuses on the needs of the workers (Wells Fargo, 2016). The department has been on the frontline to address the grievances and differences experienced in the working environment. The HR Manager offers powerful guidelines to ensure the best resources are available to the employees. This approach encourages the employees to work hard and focus on the firm’s objectives. Issues affecting different stakeholders (including customers) are handled by the HR office (Sluijs & Kluytmans, 2012). This practice has made it possible for the company to realize its goals.
This discussion shows conclusively that the basics of HR are embraced at Wells Fargo. The main observation from this analysis is that the HR practices are not aligned with the firm’s strategy. The proposed approach seeks to implement new HR processes capable of supporting the company’s business strategy (Sluijs & Kluytmans, 2012). Several processes will therefore be promoted by this new change. To begin with, the HR department will be on the frontline to attract the right people who possess the required interpersonal and technical competencies (Oxelheim, Randoy, & Stonehill, 2011).
The next process is establishing or promoting the concept of performance capability. This approach will ensure the firm “identifies and cultivates the best behaviors and processes capable of improving customer experience” (Nigam et al., 2011, p. 152). The workers will be empowered and equipped with the right resources to support the implemented processes. Departments and units will be guided by the right leaders to support the established systems. This new approach will create a new working environment driven by the company’s mission.
The nature of leadership at Wells Fargo is expected to change significantly. This happens to be the case because the above three professionals will offer better leadership styles. The main objective is to ensure the workers are guided and empowered to support the company’s strategy. The leaders will “collaborate with the followers and show them the way” (Loshali & Krishnan, 2013, p. 11). It will also be appropriate for the professionals to implement new practices that can drive performance. For instance, issues such as employee recognition, training, and satisfaction should be taken seriously. Performance evaluation should be done annually to empower the workers (Nigam et al., 2011). These evaluations will ensure competent employees are empowered in order to support the firm’s strategy. The performance evaluations can be used to reward specific workers who support Wells Fargo’s business model.
Knowledge, Skills, and Abilities (KSAs)
The employees in a specific company dictate its performance and ability to realize the targeted business goals. The proposed strategy is aimed at supporting the corporation’s business performance. The inclusion of HR in the firm’s business model can support the targeted objectives and eventually make the firm profitable. It will therefore be appropriate to hire competent individuals who possess the most desirable competencies. Such skills will be needed to empower the current workers and equip them with the relevant resources. It is important to ensure the above three positions attract professionals who possess similar skills (Loshali & Krishnan, 2013). The leaders will be required to transform the HR operations of the company. This strategy will support the existing business strategy. The targeted Chief Human Resource Officer, Business Strategist, and Administration Officer should therefore possess the KSA competences presented below in order to support the firm’s objectives.
Knowledge
The leaders should be aware of the major principles and procedures associated with human resources. This knowledge will make it easier for them to select, train, empower, and guide the employees. Business administration and management is another key area that should be clearly understood by HR practitioners. They should be aware of the major leadership techniques. Knowledge of specific customer service processes will make the individuals successful. They should have a strong background in philosophy and psychology. This background will ensure the candidates understand human behavior, personality, and motivational processes. The other “key knowledge areas to consider include information technology, economics, public safety, counseling, and accounting” (Loshali & Krishnan, 2013, p. 15). A proper background in these areas will make it easier for the leaders to support the organization’s mission.
Skills
Human Resource (HR) leaders should possess a wide range of skills in order to empower their followers. The first skill to consider is critical thinking. The targeted candidates should be able to use logic whenever coming up with new decisions. The approach can make it easier for the leaders to offer reasonable and logical solutions to various problems. Decision-making and problem-solving should be considered during the hiring process. Developed system analysis skills will make it easier for the leaders to examine how specific processes influence performance. The individuals should be active listeners, good time managers, and team players. It is appropriate to hire professionals who listen attentively, collaborate with others, and make positive judgments (Hunt, 2014). Persuasion should be considered as a powerful skill during the hiring process.
Abilities
Some people use the terms skills and abilities interchangeably. Skills and knowledge dictate the abilities of an individual. That being the case, the targeted professionals should possess a number of abilities. For instance, organization is a powerful ability that can make many HR managers successful. This ability is characterized by “effective time management, efficiency, motivation, and good recordkeeping” (Walsh, Sturman, & Longstreet, 2010, p. 17). The candidates should be effective leaders. They should use their competencies to guide their followers, make appropriate decisions, and address the major challenges affecting performance. The individuals should be able to act ethically and professionally. Problem-solving and conflict management are powerful abilities that can make a difference for HR professionals and Operations Managers (Hunt, 2014). They should also be able to implement and manage change. Every new change at Wells Fargo should be supported by the right leaders.
Technology Considerations
The above discussion shows clearly that the targeted professionals should be conversant with different information technology (IT) and computer skills. Modern informatics and technologies are transforming the manner in which business is done. Wells Fargo should therefore consider various technologies in order to drive performance. The first issue to consider is the use of social media networks. These platforms have the potential to improve the morale of many employees. Wells Fargo should embrace the use of social media platforms to communicate with its employees (Walsh et al., 2010). The employees should be guided to use such platforms and inform the targeted clients about Wells Fargo’s financial products.
The HR department should embrace the use of computers and online-based videos (such as YouTube) to educate the employees. Such videos will equip the workers with appropriate skills and eventually focus on the company’s business strategy. Modern computer systems should be implemented to guide and monitor the behaviors of different employees. Decision support systems (DSS) have become common in many financial institutions than ever before. These DSS systems should be implemented at Wells Fargo to guide the managers throughout the decision-making process. The systems will encourage the workers to present their grievances (Hunt, 2014). The process will make it easier for the HR department to address the needs of the stakeholders. The company’s website has been used to inform more people about its business agenda. It will be appropriate to improve the website in such a way that it engages more customers (Walsh et al., 2010). Such measures will ensure the company’s R&D produces innovative services that have the potential to transform the experiences of the clients.
Labor Market and Law: Addressing Legal Changes
Wells Fargo operates in a complex, diverse, and competitive industry. The current labor market is characterized by unique aspects such as diversity and legal frameworks. The firm hires its employees from the American population. The country has different racial groups. Throughout the hiring process, the firm should consider specific individuals from diverse backgrounds in order to support its business strategy. The targeted persons are characterized by unique “differences in terms of gender, culture, education level, skills, and expectations” (Colby & Ortman, 2015, p. 4). That being the case, the company should attract different individuals without any form of discrimination.
Cases of discrimination or unfair dismissal will always result in legal procedures. The labor laws in the country (and across Europe) dictate the minimum salaries for specific positions. Malpractices such as child labor are prohibited in the countries. Companies should provide the best opportunities to their workers (Colby & Ortman, 2015). Specific issues such as workplace safety, compensation for injuries, and retirement benefits are governed by labor laws. It should also be acknowledged that such labor laws change frequently in order to address the emerging needs of more stakeholders.
The government and other agencies propose laws that can impact the finance industry (Oxelheim et al., 2011). Some of these laws focus on the welfare of different workers. When there are new legal frameworks or changes, companies such as Citigroup, Wells Fargo, and JP Morgan Chase come together to challenge such propositions. The ultimate goal is to ensure the regulatory changes do not harm their business operations. Similarly, the American Bankers Association (ABA) supports the initiatives undertaken by these companies.
HRM Recommendations
Description of Other Human Resource (HR) Issues
Human Resource (HR) is an inexhaustible field that focuses on the welfare of different stakeholders in an organization. At Wells Fargo, HR has remained a powerful aspect that supports more workers. The proposed strategies will also play a positive role towards aligning the HR practices with the company’s business model (Sluijs & Kluytmans, 2012). This approach will make it easier for the workers to focus on the goals of the company.
It is also agreeable that several issues can be considered to transform the performance of the company. For instance, the hired professionals can use their KSA skill sets to promote good governance. The ultimate goal of HR should be to facilitate a powerful culture that supports the goals of the organization. Wells Fargo should ensure the HR leaders are willing to oversee specific activities that affect performance. The leaders should also promote new practices such as training and empowerment of different workers (Hunt, 2014). This process will make it easier for the employees to make the best decisions independently.
The HR department should link the employees in every business unit. By so doing, a common language will emerge whereby “the workers focus on the company’s values, principles, and mission” (Colby & Ortman, 2015, p. 5). The HR leaders should present the best concepts and inject the most desirable philosophy. The new ideology will guide and make it easier for the workers to deliver positive results.
Conclusion
Although Wells Fargo is one of the leading players in the America’s financial market industry, it faces stiff competition from different companies such as Citigroup. Additionally, its current HR practices are unsustainable and incapable of supporting the firm’s business model. Any attempt to improve Wells Fargo’s HR agenda will make a huge difference and eventually make the firm successful. Wells Fargo should recruit competent HR professionals who have the potential empower the workers. By so doing, the leaders will ensure the followers are aware of the targeted organizational objectives (Hunt, 2014). Consequently, the HR processes will result in performance capability and eventually make Wells Fargo the most successful company in the industry. The firm will use its new position to offer superior services and financial products to the targeted customers across the globe.
References
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