On October 21, 2019, Charles Scharf officially assumed the role of CEO. Can he succeed in restoring the reputation of Wells Fargo as “the bank that always does the right thing”?

by | Sep 7, 2021 | Uncategorized | 0 comments

This week we looked at the principle-agent problem and what went wrong at Wells Fargo. On March 28, 2019, Tim Sloan, the CEO of Wells Fargo, who was supposed to restore the bank’s reputation, stepped down. After a very poor showing by Sloan in testimony about the bank before Congress and with long-standing restrictions by the Federal Reserve still in place, the bank seems unable to overcome the crisis created by a whole collection of deceptive practices which rose to the level of fraud. (For more information, refer to the 2018 article “Fed Won’t Lift Wells’ Growth Cap Until Deficiencies Are Fixed: Powell” from American Banker.)
On October 21, 2019, Charles Scharf officially assumed the role of CEO. Can he succeed in restoring the reputation of Wells Fargo as “the bank that always does the right thing”? This week’s discussion will provide you with an opportunity to put yourself in the shoes of someone advising Mr. Scharf.
Instructions
For this discussion, you are going to advise Mr. Scharf on a key issue.
What about the incentive system employed by Wells Fargo resulted in massive creation of fake accounts by the retail operation? And why did it only get worse from there?
As you dig into this issue, remember Froeb’s rule from Chapter 1: “Avoid the temptation to think about the problem from the employee’s point of view . . . [and ask] how does the organization give employees enough information to make good decisions and the incentives to do so?” (1).
Your post for this discussion should answer the question above and address components of motivation and incentive in order to present Mr. Scharf with reasonable and evidence-supported advice on this issue.
Sources
Luke M. Froeb. 2018. Managerial Economics: A Problem Solving Approach (5th ed.). p. 8. Cengage.
Note: In your discussion posts for this course, do not rely on Wikipedia, Investopedia, or any similar website as a reference or supporting source. Use references.

Our Guarantees

Top quality papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university, or professional, and we will assign a writer who has a respective degree.

 

Professional certified writers

We have hired a team of professionals who provide expert academic help. Most of them are native speakers and PhD holders who are able to take care of any assignment you need help with.

 

Free revisions

If you feel that we missed something, send the order for a free revision. You will have 10 days to send the order for revision after you receive the final paper. You can either do it on your own after signing in to your personal account or by contacting our support team.

On-time delivery

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & confidential

We use several checkers to make sure that all papers you receive are plagiarism-free. Our editors carefully go through all sources and in-text citations. We also promise full confidentiality in all our services.

24/7 Customer Support

Our support agents are available 24/7 and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

 

About us

We are a team of like-minded people who established Wileyscholars.com to help students all over the world. It all began a few years ago when we, as students, helped each other complete our own assignments. Shortly after, we discovered that other students need help too: that is when Wileyscholars was created. It is an online service that provides help with academic assignments all over the world. Our main aim is to help hundreds of students pass their tests and home assignments by giving advice and helping to get to know the subject better.

 

 

Let’s Start a Conversation