Schwab strategy has evolved into a customer focused strategy with emphasis on thorough resource and cost allocation and encourages ongoing analysis of profitability of products, segments, and channels. At Schwab’s conception, the initial focus was to make stock-trading services accessible to the average person, as explained in the case (made fees affordable such as brokerage service fees which were competitive). Under Pottruck’s direction, the company suffered financial set-backs when they did not lower prices in the highly competitive market instead deciding to focus on expanding the business to include institutional trading and research, dropping individual investors on their list of priorities. The strategy again shifted to their initial strategy, focusing on the company’s long-term relationship with individual investors, providing competitive service fees, and careful allocation of resources under the reestablished management of Mr. Schwab’s. Customer retention, customer attainment, establishing long-lasting customer relationships, and building upon a structure that supports effective business decision are also key parts of the strategy.
The strategy focused on customer relationships, competitive pricing, and thoroughly analyzed resource allocation. With the changes in strategy at Schwab, information needs increased. In regard to the strategy, Schwab needed to capture data that could successfully allow them to properly allocate resources and identify profitable areas, non-profitable areas, and cost saving opportunities. The changes in strategy at Schwab have required more detailed data to be gathered for effective profitability analysis.
The different versions of PAS (Profitability Analysis System) has satisfied the information needs for the new