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Bank of America versus E-TradeA Transformation to Online Services
By Rex A. Crouch
 
 Copyrighted © by Rex A. Crouch 2009
 
This is an examination of Merrill Lynch, now Bank of America, and E-Trade. Two separateentities serving the investment industries. One is a traditional brick and mortar investment, andbanking organization, and the other is an entirely online investing interface. In identifying whichof the two companies is more transformed into the modern information technology format, I amarguing that there is no comparison; E-Trade is in fact an entirely online organization. Inintegrating what I have learned about the two organizations, I present the following:DIFFERENCE IN STATEGIESTRANSFORMING PROCESSOPPORTUNTIES AND RISKSSTRATEGY SIDE EFFECTS
DIFFERENCE IN STATEGIES
The E-trade strategy is one that distinguishes it from other online brokerages, and makes itcompetitive with traditional investment and banking services. This strategy involves onlinebrokerage services; includes banking and loan services, various insurances, and advisory services(Information Week, 2002). At the root of these services, E-Trade seeks to educate the investor(E-Trade, 2008), and have very little actual human interface, and minimize edifices whichreduces overhead. In this strategy, E-Trade enables the investors with information, allowingthem to identify market opportunities, create actionable trading ideas, and make educated real-time decisions regarding their trading. In visiting the E-Trade website, they let you knowupfront that they speak your language, whatever language that may be, and their presence isinternational. A final note in this strategy is that E-Trade offers more services than itscompetitors at more competitive rates (Fortune, 2008). With the fact that they do have moreservices than the competition, E-Trade has stated that they believe their customer loyalty willpull them through their most trying times.Conversely, Bank of America, which has recently absorbed Merrill Lynch (MSNBC, 2008)conducts investments face-to-face, and through an online an interface (Bank of America, 2009).
In their investing options, they offer ―self 
-
directed,‖ ―full
-
service,‖ ―premier banking,‖ and ―U.S.
trust private wealth management
‖
services.
Bank of America’s self 
-directed investment optionsounds similar to E-Trade however, Bank of America makes this service sound substandard totheir other options which involves human interaction.There are two significant contrasts between the two in their strategies. These are:1.
 
E-Trade
’
s efforts to educate the investor to be self-reliant, where as Bank of Americaprovides some self education information but would prefer to interact with the customer.
2.
 
The number of branch offices Bank of America has. Each of these buildings costs on theorder of $100,000.00 of dollars, and each requires insurance, security, and manning. Thisis money not being returned to the potential investor. E-Trade has one location in theUnited States, this is in Virginia. For all I know it may be a barn
 — 
I do know that theyare not wasting money by building an office in every major city in America. Similar to
of 00

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hasnw

bonjer sava je maple imad kemo tu taple

reply03 / 18 / 2009
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