Management Analysis of Wells Fargo & Company

free essayWells Fargo & Company is a multinational banking and financial services holding company. It is ranked as the third largest bank in the United States. The company has unique management, which has seen the company to maintain a cutting edge over its competitors. In today’s demanding workplace, companies need an effective leadership and communication strategy that can create innovation. Leadership in an organization revolves around work ethics, proper management approach, and a reliable system of power that urges an organization to operate based on its principles and core values. On the other hand, communication is also a vital component that determines the style and type of leadership in an organization. It means that communication in an organization is a reflection of culture, which substantially impacts communication structure and barriers.

Wells Fargo & Company operates under a distinct communication structure that is influenced by the company’s structure. The company operates under two types of communication structure, which are formal communication and informal communication. Wells Fargo & Company primarily uses the formal kind of communication because it is a service-oriented business, and a lot of information is disseminated officially. The information flows through the officially designated channels among the company’s major departments. As a multinational corporation, Wells Fargo & Company has several holdings, both locally and internationally, which suggest that the firm is using a complicated system of communication. Informal communication is also present but only at a minimal level among the employees because it is inevitable in any organization (Walker, 2010).

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There are three types of formal communication that exist within Wells Fargo & Company’s organization structure. First, it is the downward communication model, whereby communication flows from senior employees to junior employees. Senior employees have duties such as supervising, delegating, and outsourcing, and the communications of this nature have to flow from the top down (Walker, 2010). Junior employees can only take orders and complete them as instructed. On the other hand, Wells Fargo & Company also experiences an upward communication model, in which information moves from junior employees to senior employees. This type of communication arose from instances such as airing of grievances, seeking of approval, and clarification of instructions regarding the assigned duties and responsibility. The final model is the horizontal communication model. Wells Fargo & Company displays this type of model when it communicates messages directly across functional areas that exist at the same level. For instance, the communication between the finance department and the sales and marketing department constitute a horizontal communication model (Walker, 2010).

Organization cultures possess a great influence on the choice of communication model within a company, as it is a socially established reality. Culture defines the nature of Wells Fargo & Company and tends to affect every formulated strategy, policy, and decision made. Wells Fargo & Company’s cultures are found on the ground of integrity, equality, and respect. The organization’s choice of communication is structured with consideration of its effects on the general operations. For instance, Wells Fargo & Company has a culture of transparency and excellency in their day-to-day functioning, and to achieve this, the organization has to employ a formal way of communication. In the cases concerning the external environment, such as marketing approaches, Wells Fargo & Company operates in the culture of confidentiality to protect its information from competitors. A culture of privacy prompts a more encrypted formal commutation, which may involve only necessary staff in the organization.

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While Wells Fargo & Company has an excellent defined mode of communication, it can still encounter barriers to communication, which can render their communication models ineffective. Consider the situation where a leader is assigned with the responsibility of leading various team of employees on a particular task. The leader has a likelihood of encountering barriers of communication such as physical barriers, language barriers, and emotional barriers. Natural disasters like earthquakes and hurricanes can hamper the media of communication such as telephone and internet connection. The leader will lose efficient communication with the whole team, therefore distracting from the intended course of action. In the banking environment, employees have a tendency to suffer from stress, and this can affect their communication emotionally. In a case of international interaction, the language barrier is likely to be a major impediment. When a leader is working with a team with English as their second language, this can either slow the process or cause a misunderstanding in exchanging information. Leaders find it hard to handle more than one team especially when they are distantly located (Walker, 2010).

Nonetheless, the problem of the abovementioned barriers of communication has solutions that Wells Fargo & Company leaders can use to avoid or mitigate the impact caused. To deal with physical barriers such as a natural disaster that can affect the efficiency of the cellphone network, the company can install a backup medium of communication, which can serve as an alternative option when the primary medium has failed. Emotional barriers can be removed by giving employees vacations, so that they can rest from work and reload. According to psychological research, a holiday is vital, as it helps employees release stress and rejuvenate after a lengthy and tedious period of working. Lastly, the language barrier problem can be solved by hiring multilingual personnel who can act as translators when necessary. The translations can be either verbal or written in the respective languages. Wells Fargo & Company can also avoid the problem of language barrier by employing local employees to work in their foreign subsidiaries.

Wells Fargo & Company has stable leadership and governance, and this is the reason behind their tremendous success. There are six typical leadership styles; these are laissez-faire, autocratic, participative, transformational, and transactional leadership styles. Wells Fargo & Company appears to have incorporated both participative and transformational leadership styles in their management. Wells Fargo & Company is among the few companies that value the inputs instilled by its employees by involving them in peer review, while the responsibility of the final decision remains on the senior employees. The company also practices the transformation leadership style by involving both the staff and the managers in meeting the company’s mission and goals. Additionally, the transformational leadership style depends on the high level of communication of the management. Through intensive communication and visibility, Wells Fargo & Company employees become motivated thereby boost the company’s productivity (Wells Fargo, 2014).

The leadership style also determines the types of leaders in the management circle. Wells Fargo & Company has influential leaders like the chairperson and CEO John Stumpf. Since the company chooses to use both participative and transformational leadership, the majority of its leaders are thought leaders, inspirational leaders, and servant leaders. CEO John Stumpf is an example of a thought leader, as he has the tendency toward harnessing the power of ideas to actualize change (Wells Fargo, 2014). John Stumpf believes in stretching his subjects and helps them envisage new opportunities. Inspirational leaders are those who campaign for change through realistic ideas and lift the company from its current practicality to future possibility. These leaders also have the tendency toward affirming and building confidence in their employees, which instills them with a can-do attitude. Lastly, servant leaders are fond of practicing participative kind of leadership style because they like to uplift their followers towards achieving both individual goals and the aim of the organization by removing barriers and obstacles in their operations.

Integrity and transparency are the significant core values of Wells Fargo & Company. The CEO John Stumpf defines integrity as the most precious commodity an individual and a company can possess (Wells Fargo, 2014). The company has built trustworthy relationships with its customers globally. Notably, the company has not been recorded in any instances of corruption and dishonesty toward its employees and customers. Over the years, Wells Fargo & Company has attained an excellent reputation through valuing integrity and transparency (Walker, 2010). The company remains among the top three best banks in the United States because it has built trust with his customers. This is how it has ended up winning a lion’s share market in the banking industry.

Conversely, the company still has room for improvement when it comes to the level of trust with their clients by increasing and maintaining the quality of its services and products. The company can achieve this by stabilizing its rates on loans, premiums, and mortgages to retain a competitive edge in the competitive banking industry. Stable rates win the customers’ trust, and they remain loyal over the years.

The workforce is a vital resource to any organization, and a company can get the best out of its employees if they highly motivated them. According to Frederick Herzberg’s motivational theory, the satisfaction factors that motivate people at work are very complex, and they are not simply the opposite to the dissatisfaction factors (Walker, 2010) .The management can apply Frederick Herzberg’s motivational theory and provide hygiene factors to employees because it makes them happy. The important hygiene factors, which are necessary in a workplace, are tolerant policies, good working conditions, sensible remuneration, a company car, and good relationships with subordinates and supervisors. The hygiene factors are important, but they are usually temporary. According to Herzberg’s theory, the real motivators are such factors as achievement, the work itself, advancement, and recognition because they indicate a possibility for growth (Walker, 2010).The management has to focus on providing the primary motivators to boost the morale of the workforce and reduce the annual employee turnover rate.

Consequently, the correlation between leadership and communication has ensured effective management and governance in Wells Fargo & Company. Wells Fargo & Company has effective leadership and communication style and strategy, and that has accounted for their successful spell all these years. The fact that Wells Fargo & Company is a multinational company means that it has to develop a complex communication system that includes several models of communication. Good leadership and governance need a high communication level, especially when the company is large. Wells Fargo & Company management practices both participative and transformational leadership styles, and this often calls for a thoughtful and inspirational leader to meet the company’s goals. The company’s leadership and communication can be more effective when the employees are highly motivated and feel like part of the company. Through participative and transformational leadership styles, the management can receive the best out of its workforce. Finally, employees become highly motivated when secondary hygiene factors supplement the primary motivation factors.

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