Capstone Presentation

James DavalosNora Quintal Tuyet Nguyen

Ryan BilyeuAaron Sanchez

Daniel LizonMarcos Gonzales

Company Brief

Founded 1869 Worldwide offices Investment Services Industry

External Analysis

The Investment Services Industry

Five Forces Analysis

Industry Attractiveness

AttractiveOverall

5thModerately

Unfavorable

Buyer Power

4thFavorableSuppliers

3rdFavorableBarriers to Entry

2ndModerately Favorable

Threat of Substitutes

1st Favorable Rivalry

Macro Environmental Forces

Global Sustainable energy Infrastructure Emerging markets (BRIC)

Social Protect environment

Technological Improved systems

Less specialized IT Process time decreased.

Internet Communication Online trading

Macro Environmental Forces

Governmental/Political Securities Exchange Commission (SEC)

Sarbanes-Oxley Act 2002 (SOX) Financial Industry Regulatory Authority (FINRA)

Ethical Inadequately disclosed payments Use of market timing Abuse late trading Untruthful reporting

Economic Economy’s slowdown Sub-prime crisis Housing crisis

Competitors Analysis

Strategy/Position Merrill Lynch

Global Markets & Investment Banking Global Wealth Management

Morgan Stanley Institutional Securities Global Wealth Management Group Asset Management

Goldman Sachs

Internal Analysis

Inside Wall Street’s ‘Black Box’

Business Definition/Mission

Definition Global Investment banking, securities, and

investment management firm.

Mission As far as our group could discern, Goldman does

not have a mission statement.

Firm’sManagement Style

Style - Management by objective

Employee’s are given control over goal setting.

Management only intervenes when something is not going right.

Organizational Structure

Flat Minimum chain of command Efficiency is key

Decentralized Authority is delegated to divisions, functions and

employees at lower levels.

Organizational Controls

Output Controls Flat and decentralized = focus on divisional and individual

goals

Culture Company values (fourteen principles)

Behavior Controls Incentives such as pay raises and bonuses

Organizational Values

Clients come first Fiduciary responsibility

Creativity and Imagination Ability to avoid pitfalls others could not because

employee’s are challenged to “think out side of the box.”

Integrity and Honesty Trust is key in financial industry

Competitive Advantage

Small number of clientele allows for more focused customer service

Customer

Responsiveness

Focuses on streamlining processes, large investments in technology innovations

Efficiency

Leader in new products and processes

Innovation

Focuses on having the greatest product lines and managing affairs in all aspects of business

Quality

Popular Ratios

15.32%10.08%20.7%Industry

16.50%10.32%30.1%Morgan Stanley

14.62%10.74%34.9%Merrill Lynch

18.75%13.58%43.2%Goldman

Sachs

Return on Equity

Net Profit Margin

3-year est. growth(sales)

Critical Issues

Current events & concerns

S.W.O.T. Analysis

Threats Financial Market Volatility Consolidations Conflicts of interest

Opportunities Focus on investment banking in the US & Southeast Asia

Private equity account generation

Weaknesses Negative cash flow from operations Interest income instability

Strengths High profitability and margins Investment banking leader High brand equity Recruitment & retention of talent

Critical Issues

Credit Crunch Avoidance FICC fueled capital Went short Small CDO holdings Analysts now predicting

other firms write downs Entrepreneurial culture

Critical Issues

Volatility of Financial Markets Drastic stock changes Harmonizing

Client requirements Profitable market returns

Balancing Secrecy and Transparency “Black box” SEC reporting

Recommendations

Mission Statement & Recruiting

Mission Statement

Why have a mission statement

What are the benefits of the mission statement

What is the mission statement

Implementation of Mission Statement

Use the Mission Statement to explain the 14 Business Principles

Post is on bottom of emails

Create a beautiful 2 story water fountain with the Mission Statement in gold around the spout with Koi fish in the pond

Recruiting

Continue to seek out desired individuals

Matrix Program

Make a greater presence on college campuses

Recruiting Implementation

Use the Matrix Program

Be Proactive on College Campuses Talk to Student Orignizations

Delta Sigma Pi or Beta Alpha Psi etc… Career Services

Questions

Final thoughts?