Capstone Presentation

1
Capstone Presentation

• James Davalos
• Nora Quintal
• Tuyet Nguyen
• Ryan Bilyeu
• Aaron Sanchez
• Daniel Lizon
• Marcos Gonzales

2
Company Brief

• Founded 1869
• Worldwide offices
• Investment Services Industry

3
External Analysis

• The Investment Services Industry

4
Five Forces Analysis

• Industry Attractiveness

5
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

6
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
• Economys slowdown
• Sub-prime crisis
• Housing crisis

7
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

8
Internal Analysis

• Inside Wall Streets Black Box

9
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.

10
FirmsManagement Style

• Style - Management by objective
• Employees are given control over goal setting.
• Management only intervenes when something is not
  going right.

11
Organizational Structure

• Flat
• Minimum chain of command
• Efficiency is key
• Decentralized
• Authority is delegated to divisions, functions
  and employees at lower levels.

12
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

13
Organizational Values

• Clients come first
• Fiduciary responsibility
• Creativity and Imagination
• Ability to avoid pitfalls others could not
  because employees are challenged to think out
  side of the box.
• Integrity and Honesty
• Trust is key in financial industry

14
Competitive Advantage
15
Popular Ratios
16
Critical Issues

• Current events concerns

17
S.W.O.T. Analysis

• Weaknesses
• Negative cash flow from operations
• Interest income instability

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

• Opportunities
• Focus on investment banking in the US
  Southeast Asia
• Private equity account generation

• Threats
• Financial Market Volatility
• Consolidations
• Conflicts of interest

18
Critical Issues

• Credit Crunch Avoidance
• FICC fueled capital
• Went short
• Small CDO holdings
• Analysts now predicting other firms write downs
• Entrepreneurial culture

19
Critical Issues

• Volatility of Financial Markets
• Drastic stock changes
• Harmonizing
• Client requirements
• Profitable market returns
• Balancing Secrecy and Transparency
• Black box
• SEC reporting

20
Recommendations

• Mission Statement Recruiting

21
Mission Statement

• Why have a mission statement
• What are the benefits of the mission statement
• What is the mission statement

22
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

23
Recruiting

• Continue to seek out desired individuals
• Matrix Program
• Make a greater presence on college campuses

24
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

25
Questions

• Final thoughts?