Barclays: Matt Barrett’s Journey †Winning Hearts and Minds Essay

The fact that Barclays is one of the four most dominant retail and commercial banks in the U.K. says a lot about its reputation. This company has faced many challenges between the time periods of 1980-2000. Matt Barrett has several great ideas to turn this company around, and the factors that should be considered are essential to the success of his strategy. Social/Demographic The Company initiates good customer relationship skills. They have built personal relationships with one out of five personal customers, and have direct relationships with 25% of the businesses in the U.K. On the downside, the company’s cost base is much higher than its competitors. The plan is to change the core infrastructure of the company in order to build a stronger customer base. Becoming more competitive and offering value to its core products will give Barclays the competitive edge it needs to help increase profit and attract new clients. Technological Barrett and his Executive Committee (ExCo) team have plans to restructure the company by shifting its culture. In order to shift the culture, the mind-set of the employees has to change. Barrett promoted younger talent to join his ExCo team to give the company fresh innovative ideas. These new ideas will give solutions to replace the incompetence of traditional strategies that are no longer useful. The company also did an analysis on the industry and company data to figure out which segments were making money, and which ones weren’t. A value-based management approach gives the ExCo team an opportunity to take on challenges and risks, and make strategic decision about what segments to add, and what to take away. Economic Considering that Barclays is a reputable company, and the fact that an estimated 20% of its profits are generated outside of the U.K; it would be ideal for the company to expand to gain exposure. The company is the ninth largest bank in Europe, and already has a customer base in the country. Developing a second home market in continental Europe would allow the company to create a larger customer base, therefore increasing profit. Environmental/Geographic Barclays is located in a stable economy with a strong domestic franchise. The only crutch is that they need a strategy to compete with new entrants. The U.K. accounts for 80% of the company’s profit, so plans to restructure core products will require a dynamic strategic plan. Using diverse tactics to differentiate product/customer markets will help aid in maximizing the economic value of the company; and improving these products by offering value to clients will aid in creating a stronger customer base. Political/Legal/Governmental Barclays is the first foreign bank to file with the Securities and Exchange Commission in Washington D.C. This is an advantage to the company on a global scale because banking laws are enforced according to SEC regulations. On the downside, the company may be overlooked by firms who are looking to establish offshore accounts in order to bypass these regulations.