1. The New CRA regulations required better penetration of moderate income groups by lending institutions, Snowden’s team focused on creating value in urban minority communities and managed to win a “outstanding” CRA rating by aligning their focus to low and medium income groups. More importantly they did it while showing FCB as a profitable and scalable practice. Snowden’s model of managing the CRA’s rule change and creating a model which could be adopted in every category was successful.(Rosabeth 1996) (Galvin 2001)
2. A corporate culture was created which focused on providing value for their stakeholders who made them successful with minority groups. This was seen at every level of the organization (Manager to Bank Teller). Employees were pushed to understand the specific need of a customer which were not common in other corporate banks which led to their success in finding untapped requirements. From a leadership standpoint Snowden did a great job in communicating effectively with her staff and minimize their concerns on what would happen post-merger. (Galvin 2001)
3. FCB’s had to maintain and nurture the relationships built over the years with minority groups as well as their value systems of being involved in the community during challenging times such as CRA changes, Mergers and any economic downturns. Fleet bank was known for being CRA centric i.e. doing business only to fulfill requirements, it was a challenge for FCB to absorb them and teach Fleet bank their focus on being customer centric. Snowden also faced an internal issue in giving confidence to FCB employees when they were unsure what would happen to their jobs post-merger. (Galvin 2001)
4. In terms of new stream activities CBG engaged in an internet strategy to develop its product line and brand image. This can evolve into easy access points for customers e.g. to check bank balance or transfer money over the internet and from the bank standpoint serve a growing customer base without opening new branches. Moving away from standard loan practices , creating customized lending products can help open a new customer base and increase revenues to the bank , an example could be loans for retain outlets in the inner city., and pushing the concept of community reinvestments with newly merged banks to prepare for drastic increases in branch sizes which will allow for further revenue opportunities based on their geographical location . As mentioned earlier Fleet bank was not customer centric, by using FCB’s minority centric strategy and lending practices they could open new revenue streams they didn’t know existed. (Galvin 2001)
5. This feeds into importance of leadership, i.e. sticking to a strategy to make sure that at times of change the value systems remain the same. The reason behind FCB’s success has always been the drive in identifying and maintaining client relations and nurturing a sense of family, a foundation which is paramount to overcoming future hurdles. (Rosabeth 1996) (Galvin 2001)
References
Kanter, Rosabeth. "First Community Bank (A)." Harvard Business School Case (1996). Print.
Galvin, Daniel. "First Community Bank (B) Community Banking Group." Harvard Business School Case (2001). Print.
