Summary
Wall Street brokerage firm Charles Schwab & Company has seen a growth rate
at over twenty percent each year. By 1998 the company had at least sixty five hundred
employees. Schwab has over six million investor accounts worldwide. Gomez Advisors,
a research firm, has ranked Schwab first in a number of key categories, including
customer confidence.
Analysis
Chief Executive, David Pottruck and Schwab are looking into ways to "trim fat"
off the firms bottom line. Both men have recognized that this is a priority. Both leaders
also understand that there are "high human costs" in downsizing. Both leaders know that
downsizing does make good economic sense. Schwab said that he will delay downsizing
the firm can adhere to five simple rules: long-term growth, Industry leadership, business
expansion, commitment to technology, commitment to change.
Recommendations
When a company such as Charles Schwab, becomes as large as it is, it is very
difficult to maintain long term growth without "cutting fat". Long term growth is one of
the five commitments Schwab is currently focused on. Those commitments are a priority
and goal to any Fortune Five Hundred Company. Striving to be the best is not as tough as
remaining the best in a corporate world of financial firms. An easy solution to cutting fat
without actually trimming would be to exercise a pay decrease without killing jobs. If
Schwab were to mandate pay decreases to all employees deemed non relevant or
employees who have seemed to get lost in the shuffle, Schwab would then be able to
keep good employees on staff a ...