Environmental Analysis

Environmental Analysis includes an assessment of the internal and external operating environments.   This is most commonly achieved through a SWOT analysis.   Strengths and weaknesses are assessed at the internal level while opportunities and threats are reviewed at the external level.   For Chase, strengths include a strong balance sheet, depth of resources, and strong management. Weaknesses or vulnerable areas are the company’s size, finding and retaining qualified and talented labor, and large infrastructure.   Opportunities for Chase include expansion into new markets such as the West Coast and Southern states where there is not a current market presence.   This paper will assess the environment in which Chase operates.

The Remote Environment
The remote environment in which Chase operates is a highly regulated industry.   The financial services industry is subject to rules and regulations set forth by lawmakers as well as financial and fiscal policy determined by government, the Federal Reserve.   Economic pressures such as interest rates, political pressures such as war, technological advances such as immediate access to fund and instant information and social movements such as boycotts and bans all can have profound affects on the firm’s financial success.   A dedicated team of risk managers should constantly evaluate these forces and their effect on the firm.

The Industry Environment
The industry in which Chase operates is the financial services industry.   Since this industry is highly regulated, there are significant barriers to entry.   Supplier power and buyer power are determined by the rates charged by the Fed and the level of consumer confidence as well as the overall health of the economy.   For example, in a rising rate environment, consumers will invest money.   In a decreasing rate environment, customers will borrow money.   There is a delicate balance between what a bank will pay for a deposit account and what they will charge for a loan....