E-Trade Case Study

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Strategic Analysis
 
of
 
E*TRADE Financial Corporation
 
 
  
 
 
 
 
 
 
 
 
 
Strategic Management
BA 598
8/9/04
 
 
Instructor: Dr. Melcher
 
 
 

Comments: 
You made good use of critical feedback in strengthening the descriptive sections.  Despite your problems in building a combined analytical map in the analytical section, you show good understanding of Newtonian analysis and recommendations, and a reasonable handle on Euclidian analysis.  Overall, your group demonstrates a handle on doing strategic analysis.  It earns the group an A on the project.   

 
 
 
Table of Contents|
 |  |
I.  Introduction to the Project| 1|
II. Environmental Description| 1|
      A. Industry Definition| 1|
            1. In General| 1|
            2. Broad Definition| 1|
            3. Narrow Definition| 1|
            4. Selected Definition| 1|
      B. Background on E-Trade and the Selected Competitors| 2|             1. Focus on analysis – E-Trade.| 2|             2. Competitive firm – Charles Schwab, Inc.| 4|             3. Competitive firm – A.G. Edwards, Inc.| 6|       C. Performance Description| 8|

            1. Select financial information for each company| 8|             2. Fiscal year reporting| 8|
            3. Ratio analysis| 9|
                 a) Return on stockholder equity| 9|                  b) Return on assets| 10|                  c) Net profit magrin| 11|                  d) Asset turnover ratio| 12|                  e) Inventory turnover ratio| 13|                  f) Receivables turnover ratio| 14|             4. Market Share| 15|

            5. Summary of financial analysis| 16|       D. Defining the structure of the industry| 17|             1. General overview of the industry| 18|             2. Our approach to analyzing the industry structure| 19|             3. Porter’s underlying axioms – View of power| 20|                  a) Porter’s view of power and its application to the industry| 20|                  b) Opportunistic behavior| 21|                  c) Alternative axioms of power| 22|             4. Modified Porter table| 23|

                 a) Barriers to entry| 23|                  b) Barriers to exit| 24|                  c) Power of suppliers| 24|                  d) Power of buyers| 25|                  e) Rivalry among competitors| 26|                  f) Threat of substitutes| 27|             5. Porter axioms – Common Pressures and Degree of Global Competition| 28|             6. Further environmental study – Mapping| 28|                  a) Structure of the industry| 28|                  b) Performance data| 29|             7.  Combined Mapping.| 29|

III.  Strategy Description| 30|
       A.  Financial Strategies| 30|
             1.  Analysis| 30|
       B.  Operating Strategies| 32|
             1.  E-Trade Operating Strategies| 32|              2.  Charles Schwab Operating Strategies| 33|              3.  A.G. Edwards Operating Strategies| 34|              4.  Exploring Underlying Axioms on Strategic Choice| 35|                   a.  Porter’s Axioms on Cost Leadership| 36|                   b.  Porter’s Axioms on Differentiation| 36|                   c.  Tradeoff Theory of Cost Leadership & Differentiation| 37|              5.  Generic Strategies| 37|

                   a.  Low Cost Leadership Strategy| 38|                    b.  High Differentiation Strategy| 38|                    c.  High Value Leadership Strategy| 39|              6.  Analysis of Marketing Strategies| 40|                    a.  Degree of Cultivation of Markets| 40|                    b.  Advertising of Products/Services| 41|                    c.  Promotional Emphasis| 42|              7.  Analysis of Production Strategies| 43|       C.  Leading...
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