Strategic Analysis Of Paragon Financial Group

Overview of the company

Paragon financial is the factoring organization which was established in the year 1994. It is a popular financial organization that provides the capital solution, banking service and credit protection regarding services (Paragonfinancial.net 2018). Within 24 years the company has established its large portfolio. In order to address the niche market the company has started providing the banking services. Customer satisfaction is one of the important strategy adopted by the company to develop its business. It has been identified that the company has expand its business in all over UK. The company has gained popularity in the market because of its quick customer services.

In order to analyse the internal environment SWOT analysis has been done

Strength: It has been identified that the biggest strength of the company is it has already gained its position in the global financial industry. Efficient employees play an important role in the case of providing the effective customer service. Due to its excellent customer service facilities it has developed the strong customer relationship. Large number of customer accounts have increased its strength in the industry. The company has near about 300000 customer accounts, which is quite impressive (Paragonfinancial.net 2018).

Weakness: Strict government policies and the financial rules and regulations are the major weakness for the company. On the other hand it is also true that in the case of financial sectors earning liability and volatility issue. Risk of defaults regarding the capital transaction is another weakness of the company.

Opportunities: The Company named Paragon Financial group has already developed its strong image to the customers’ mind, which will help in the case of developing its business. If the current financial sector growth is being analysed, it will be identified that with the help of good quality of service and accommodation with various ranges, it has brought various opportunities. Private renting has increased its popularity among the customers. The private rented sector is growing housing tenure and it has started forecasting to surpass social housing within coming years.

Threats: In this sector the economic situation and the finance availability are being considered as the biggest threat. The government regulation, additional taxation policies, supply chain management issue and relation with the investors are the major threats for the company.

In this study, PESTLE analysis has been done in order to analyse the external environment of the company.

a) Leadership and communication

Leadership and communication is being considered as the essential part for every strategic plan in order to improve the organizational culture as well as productivity (Jin, Meng and Berger 2017).  It has been identified that the company needs to provide the effective business skills that will help in the case of improving their efficiency. It can be said that the company wants its employees to be equipped with the help of transferable skills so that one can effectively perform in eight to nine job roles. It has been identified that the company has adopted the strategy to introduce the transformational leadership practices in the organization so that interpersonal skills of the employees can get improved.

Analyse appropriate tools and techniques

  b) The company culture including its ethical and value base

If the internal culture of the company is being analysed, it cannot be said that the company has a stable leadership team (Berger and Meng 2014). However, it has been identified that the company focuses on bringing the effective changes in the organization so that the flexible relationship among the employees can get developed. On the other hand, it has been identified that the company has been identified that in order to develop the organizational culture the management team actively solve the problems of the employees. Different types of incentives are being provided especially to those employees who are associated with Paragon for the long time.

c) The company’s position in the sector 

The company was established in the year 1994 and within 24 years the company has established its popular image in the market. It has been identified that Paragon Financial group has expand its business in all over the UK. The company provides the cash flow regarding solutions to the large multinational organizations, individual customers and Medium sized business organizations. It has been identified that with in last 6 years the company has gained 500 pounds. The estimated annual revenue of the company is $19.4 million. The major competitors of the company are Arrow Financial Services UK ltd, Hitachi capital (UK) plc.

d) A critical evaluation of the strengths and limitations of the tools and techniques you have used 

The major strength of the company is it has large number of customer base and efficient group of employees. With the help of modern technological supports the company has brought various innovations in its customer services. However, in the current situation the company is dealing with the challenges as it has spread its location all over the UK, hence, it has become tough for the company to manage the service in effective manner. Change is constant in the financial industry, due to this reason, it become very difficult to manage the risk factors. On the other hand, it has been identified that the company named Paragon financial group faces the challenges due to the market competition. The market competitors are developing the new policies and products in the market, which have created pressure on the organization.

e) The client needs 

In the current business scenario, most of the people are aware about the financial services. In order to manage their capital resources customers search for the companies, which can provide them secure financial advice and manage the cash flow problem effectively. On the other hand, clients need the easy banking services so that it can be easily accessible. Responsive customer service is another important need of the clients.

Competitive financial market has aroused various challenges for the company regarding its customer satisfaction. On the other hand, it is true that the financial policies are very complicated due to this reason sometimes it becomes harder for the employees to convince the customers as they prefer the easy way.  Market analysis is required in order to analyse the position of competitors in the market. Therefore, the management needs to take the initiative for research and development practices. It cannot be denied that in the rapid growth in the financial sector the business organizations face challenges regarding the changing legal policies (Cavazotte, Moreno and Hickmann 2012). In this study it has been identified that the company is dealing with the issue regarding unstable leadership practices in the workplace. After analysing the entire study, it can be recommended that the company needs to focus on making the quick decision regarding its developing projects. If the ongoing projects can developed within a few months, this will help to gain the competitive advantage. Communication has brought the issue to the company for convincing its customers. In this case, if the management will take the initiatives to clarify the objectives to the employees and make them aware regarding the new financial services, this will help the employees to convince the customers.

The internal environment

The management needs to more active in the case of translating the financial policies to the employees (Cavazotte, Moreno and Hickmann 2012). In order to introduce the effective leadership practices, training and development initiatives are required. This process will improve the efficiency of the employees that will help in the case of increasing its customer base. On the other hand, it has been identified in this study that location has become one of the major issues of the organization to deal with the challenges in the case of managing the entire operational activities. In this case, it can be suggested that the company needs to focus recruiting more employees so that the operational activities can be done in an effective manner. In order to gain the competitive advantages, the business organization needs to focus on introducing the modern software so that the banking will become easier for the customers.  As the study has identified that the company focus on improving the multitasking skills of the employees, therefore, this can be said that in order to motivate the employees’ incentive programs is needed to be introduced in the company. 

Implementation of the strategic initiatives is very important for dealing with the organizational issues. In order to manage the leadership related issues, the company needs to focus on developing strong leadership skills. In order to identify and develop proper leadership skills the organization needs to select the right style of leadership so that employees get motivated and feel free at the workplace. There are several leadership styles or theories that can help the company in this context. These leadership theories or styles are discussed below:

This is one of the traditional style or theory of leadership. As per this particular theory the leader must lead the sub-ordinates by giving orders. In this leadership style the leader plays the role of the dominator (Coetsee and Flood 2017). Leader is the key person who makes all decisions at the workplace and the sub-ordinates are bound to follow those orders.

This is another leadership style that is quite opposite to the autocratic leadership style. In this style leader allows the sun-ordinates to take part in the decision-making process (Dinh, et al. 2014). The leader considers all team members equally important for the organizational developments.

The term transformational leadership indicates the leadership style that influences the leaders to encourage the team members to identifying the required changes (Ehrhart 2015). In this process the leader play an important role in the case of inspiring the employees towards bringing the innovation in their work. This leadership practice is being considered as one of the popular leadership style because in this process the team members are being motivated towards their work, which influence the overall team performance. In this process the moral standard of the person gets influenced. Moral maturity is being gained by the person who involves in such practices. Transformational leadership is beneficial for the organizations to introduce new ideas and innovation in its activities.

Figure: Transformational leadership style

The external environment

(Source: Baumeister 2016)

In the case of Paragon financial Group, it can be said that the transformational leadership practices is very important. As the comment is dealing with unstable leadership practices, hence, in this situation transformational leadership practices can help to gain the competitive advantage. In the above diagram it has been clearly shown that the transformational leadership has four components. In the idealized influence, the leaders become role model for the team members. In this study, it has been mentioned that the company provides transformational skills to the employees for performing multiple tasks, therefore, in this case the ideal leader is required. Transformational leaders will play an important role in the case of motivating the employees, so that they improve their performance to convince large number of customers.

After analysing the situation of the company, it can be said that motivation is another important part in transformational leadership practices. In the Maslow theory five needs of human have been highlighted. Physiological needs, social needs, safety needs, self-actualization and esteem needs. Sleep, hunger and thirst involved in the physiological needs. Protection, security and freedom indicate the safety needs. Friendship, love and social activities indicate the social needs. Self-desire indicates the self-actualization and self-respect, self-confidence and self-achievement influence the self-esteem (Rasskazova Ivanova and Sheldon 2016).

Figure: Maslow motivational theory

(Source: Rasskazova, Ivanova and Sheldon 2016)

In the case of satisfying the needs of the employees the company has focused on introducing Maslow motivational theory so that the management will be able to understand the needs and demands of the employees as well as the customers. In the case of Paragon Financial Group, the management needs motivate the employees for their achievements. Especially the employees who are working with the organization for long time are needed to be provided proper respect that they deserve. On the other hand, developing healthy relationship in the organization is required for improving its internal culture.

Communication is one of the important part in every organizational development. It is true that the company needs to focus on the case of dealing with stakeholders. In this situation if different workshops and seminars can be arranged with the clients, this may help to convince them. On the other hand, these strategies can also be beneficial in the case of influencing the investors towards the company. New policies and products should be introduced through different seminars, where the employees will also be able to earn about the initiatives. If the objectives of the company will be clarified to the employees, they will be able to improve their knowledge regarding the financial policies. On the other hand, promotional practices is also required in the case of influencing the clients. Promotional activities are being considered as the important element in developing customer relationship (Sanjeev and Surya 2016). Therefore, different advertisements through social media can help the company to increase its popularity among the customers. On the other hand it needs to recruit a customer service management team for 24 hours. It can be beneficial for the company to deal with the customer complaints.

Strategic position

Effective communication and encouragement through the recommendation can play important role in the case of influencing the organizational performance. It will also empower the organizational activities. Knowledge and skills of the employees will also get improved. On the other hand, it has been identified that by adopting the effective leadership strategies the innovative ideas can be introduced in the organization.

Source: created by author

In the above study it has been identified that leadership and communication have higher level of contribution in the financial industry. During the study I have experienced many new matters and business situations of Paragon Financial Group. However, in order to properly reflect on my knowledge, here I have used the Gibb’s reflective cycle. The critical reflection is done below:

Description – While performing this study I was playing the role of a consultant for the business development of Paragon Financial Group. As per the scenario, the Paragon Financial Group is currently facing a problematic situation in terms of leadership. The organization needs to select the right leadership style so that the employees can work properly. During the analysis, I have identified that there are several leadership styles that are available to Paragon.

Feelings – Evaluating different styles of leadership, I found out that the transformational leadership is the best leadership style that Paragon must apply in its current situation. I feel this because this leadership style allows the leader to help the employees in different ways so that they can cope up with the changing business situations. As per my understanding, this leadership style can make the employees at Paragon multi-tasking.

Evaluation – After investigative on the transformational leadership style, I understood that if the company implements this leadership style, the leader-employee relationship will be better. Employees will feel free at the workplace and they will be able to concentrate more on the job responsibilities. Transformational leadership style will also allow the leaders involving the employees in the decision-making process, which I think important for motivating the employees.

Conclusion – Performing this study I have gained knowledge on several areas. I have improved my analytical knowledge while analysing different leadership styles. This analytical knowledge will help me dealing with different critical situations in the coming years when I will be employed at any organization. At the same time, knowledge about different leadership approaches will help me identifying the right leadership style for dealing with the situations that I will face in future. Moreover, I can also mention that if I face similar kind of situation again in the future, I will be able to handle the situation efficiently by recalling this experience.

Action plan – In order to deal with this kind of situations in future I need to analyse the situation critically. After analysing the situation, I need to identify the right leadership style that will be the most suitable leadership style for that situation only. After selecting the right leadership style, I will require developing a good communication with my sub-ordinates with who I will deal. During communication I need to apply the leadership style. During the whole time, I will keep focus on time management also.

Reference and bibliography

Baumeister, R.F., 2016. Toward a general theory of motivation: Problems, challenges, opportunities, and the big picture. Motivation and Emotion, 40(1), pp.1-10.

Berger, B.K. and Meng, J. eds., 2014. Public relations leaders as sensemakers: A global study of leadership in public relations and communication management. Routledge.

Boies, K., Fiset, J. and Gill, H., 2015. Communication and trust are key: Unlocking the relationship between leadership and team performance and creativity. The Leadership Quarterly, 26(6), pp.1080-1094.

Cavazotte, F., Moreno, V. and Hickmann, M., 2012. Effects of leader intelligence, personality and emotional intelligence on transformational leadership and managerial performance. The Leadership Quarterly, 23(3), pp.443-455.

Coetsee, J. and Flood, P.C., 2017. 8 Leadership models: the future research agenda for HRM. A Research Agenda for Human Resource Management, p.130.

Dinh, J.E., Lord, R.G., Gardner, W.L., Meuser, J.D., Liden, R.C. and Hu, J., 2014. Leadership theory and research in the new millennium: Current theoretical trends and changing perspectives. The Leadership Quarterly, 25(1), pp.36-62.

Ehrhart, M.G., 2015. Self-concept, implicit leadership theories, and follower preferences for leadership. Zeitschrift für Psychologie.

Gomez-Roman, C. and Sabucedo, J.M., 2016. The Occupy and Indignados movement and the importance of political context: differences between occasionals and regulars in Spain and the UK. European Journal of Government and Economics, 5(1), pp.29-46.

Jin, Y., Meng, J. and Berger, B., 2017. The Influence of Communication Leadership Qualities on Effective Crisis Preparedness Strategy Implementation: Insights from a Global Study. Communication Management Review, 2(01), pp.8-29.

Johnson, C.E. and Hackman, M.Z., 2018. Leadership: A Communication Perspective. Waveland Press.

McNair, B., 2017. An introduction to political communication. Routledge.

Paragonfinancial.net 2018. Available from https://www.paragonfinancial.net/

Porfírio, J.A., Mendes, T.C. and Felício, J.A., 2018. From entrepreneurship potential in culture and creative industries to economic development: the situation of UK and southern European countries. International Entrepreneurship and Management Journal, 14(2), pp.329-343.

Rasskazova, E., Ivanova, T. and Sheldon, K., 2016. Comparing the effects of low-level and high-level worker need-satisfaction: A synthesis of the self-determination and Maslow need theories. Motivation and Emotion, 40(4), pp.541-555.

Sanjeev, M.A. and Surya, A.V., 2016. Two factor theory of motivation and satisfaction: an empirical verification. Annals of Data Science, 3(2), pp.155-173.

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