Morgan Stanley

Topics: Morgan Stanley, Mergers and acquisitions, Morgan Stanley Smith Barney Pages: 2 (398 words) Published: March 6, 2013
1 .Why did Morgan Stanley underinvest in information technology?

His main focus was on management and organization changes and not information technology, when trying to restore revenue. Also, when the two publicly held companies merged together, their operations were still running as if they were two different entities. Dean Witter's Retail Brokerage which managed close to $616 billion in client assets where never fully integrated into Morgan Stanley's information systems. Some individuals mainly Philip Purcell, thought that the merger could be successful without the heavy investment into technology. Unfortunately, the problem with this is that it caused a lot of headache and tension with employees from Dean Witter. They were not accessible to the same technology as the Morgan Stanley employees by any means. They experienced problems with desktop PCs, which hadn't been upgraded in years that would just completely shutdown. Printers that were being used by more than one individual at the same time would eventually cause paper jams. Eventually, due to the decisions of Philip Purcell when running the company at this time, he would be forced to resign under intense pressure from shareholders, employees, and investors as well. While greater investment in information technology would certainly push productivity higher, one should not underestimate the transition taking place in the labour market.

2. Why was the merge with Dean Witter disruptive for the company?

The merger was disruptive for a multitude of reasons. One being that the companies' technology was never implemented properly causing countless hours of problems which caused the company to lose much needed revenue and profit. This caused the brokers to be inadequate with the tools necessary when assisting their clients. The company's website was very marginal at best. It had several problems with functionality and maneuverability of the websites. The trade mechanism which allowed the purchasing and...
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