I am addressing this letter because I believe that profit maximization is a key factor in any business and the same should be the case with the bank of America. Bank of America has a challenge as pertains to cost management, and unless the CEO checks on the same, a massive deficit will occur. The CEO, Mr. Brian T. Moynihan, has opted to dispose of nearly all of its assets and cut on man labour in a bid to maintain their cost of production.
The CEO should not sell any property, instead of selling; the same assets may be improved and be sub-leased thus act as an n income generating factor. The buildings in Hopewell, N.J and Concord in California are of high rates, and they can attract substantial amounts of money through leasing out of the same. The leaseback plan by the bank should be replaced by a security of long-term loan. This help as compensation for the deficit in the input. In my opinion, that would ensure continuous production and dispensation of services by the institution.
The bank of America should review the man-labour input so as to save on the production cost. The bank would, therefore, channel the proceeds to the maintenance of the banking services putting into consideration the need of online banking and trading. The bank has to encourage investments to help supplement the capital.
The banks’ good relation with the clients would maintain its fiscal stability and ensure a more stable growth of the company. Therefore, the plan to divide the business empire should be in consultation with the stakeholders of the company and not the sole decision of the CEO. This makes the clients feel involved and considered as regards the company’s interest.
The CEO has to consider the above sentiments for the reputation of the bank of America to keep shining.