Introduction
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SUMMARY
One of the main notions behind conducting this study is to shed light on the topic of all sorts of strategic issues and other challenges related to a company when it’s working globally. In that case, strategic issues are those principal strategic selections or key issues which ought to be talked about with the intention for a society to attain its long-term objectives. While highlighting the strategic issues a company is usually very active in placing itself for the upcoming time instead of just answering the problem (Abedin, 2015).
The company which has been selected to conduct the research report is mainly transferred Wise. The company was started in the year 2011 with the objective of creating global fund transferal reasonable, fair as well as easy. In the present day, the multi-currency account assists thousands of persons as well as businesses administer their funds' crossways the globe. The company was started by two friends Taavet and Kristo. The main motive behind starting this business was by looking into the waiting time issue people faced when they need to transfer the money urgently. The two owners identified that people require additional than simple transferring of the funds. That is the reason they added a multi-dollar account a debit card, and a business account, and transformed our name to Wise (Limited, Wise Payments, 2022).
The study has been divided into four main segments in which:
- The first part of the study will discuss the strategic issues which the company is facing presently
- The second part of the study will look into the business challenges that the company is facing
- Based on the issues identified proper solution will be provided
- Based on the solution provided the implementation of the solution will be provided in the last segment of the study
MAIN BODY
Strategic Issues
There are many reason due to which most of the companies confronts strategic issues within their functioning. There are various reasons due to which strategic issues arise some of the are related to just using a basic plan to run the business, not comprehending the ecology r providing focal point over the outcome and some are related to having wrong employee or wrong pioneers in the main position of the company (Heugens, 2003). The most notable forms of strategic issues identified within the companies depend on the way they are functioning and dealing with the main challenges. In this segment of the study a proper discussion will be done on the various strategic issues which the TransferWise Company is facing in the present day. The issues can be categorised into six main segments which are discussed in detail below.
- Strategic Focal point: As per the report it has been identified that the TranferWise has very recently marked a milestone by entering into public listed company list but it is facing new strategic issues as a public company. The CEO of the company Kristo Käärmann pointed out to the workers associated with the company that they are still in a developing phase in their journey due to which proper focus in not given over using proper strategies for the company. In addition to this the company has not set up proper short-term and long-term objectives due to which their strategic alignment with the functioning is not clear too.
- Strategic Competencies: Considering the strategic competencies as the second component of the strategic issue in case of Transfer Wise it has been seen that its development rates have been going down of late, especially in areas where it is now deeply grounded, like Europe. A new broad report on Wise by FXC Intelligence examines inside and out the financial matters of Wise including how much lower its take rates are than numerous different players (a major cutthroat differentiator for Wise). Yet, much lower take rates and easing back top line development will come down on its general income development. This will represent an issue for an organization that presently needs to proceed with solid development assuming it is to extend its valuation and expand on its fortunate business sector site.
- Asset limitation: Trasnfer wise business past its center locales of Europe, North America and Asia-Pacific presently stays little, representing simply more than 6% of its absolute income in 2020, and almost certainly, extending this will be an imperative piece of its arrangements for future development. On the other hand this isn't devoid of its issues, and where Wise will pick to concentrate its endeavours is not yet clear. In Africa, for instance, there are various organizations taking care of the settlement and cash move requirements of the landmass, including developing quantities of organizations established in the locale with solid associations and a comprehension of the shifting necessities of various nations' shoppers. Many spotlight on money or portable wallets, neither of which is a focal point of Wise.
- Strategic alliances: As Wise confronts the truth of its new venture being a public organization; it does as such in a business sector which is extremely mindful of how much business it has lost to the challenger, and where development is coming from numerous headings. Transfer Wise methodology has for quite some time been to give quick cash moves at an altogether inferior cost as compared to financial institutions, and it stays a solid player for this, with a take rate essentially beneath a considerable lot of its rivals. Nonetheless, although it is exceptionally serious on bank-to-bank moves, it doesn't contend also on card-based pay-ins, and it is confronting mounting rivalry from others in the business. Over the long haul, Wise might track down that its speed, not its cost, is its greatest edge.
- E-Commerce product: Considering the strategic issues of e-commerce product as the company is into transaction services and not dealing with any particular product as a result they face tremendous competition from the other e-commerce companies who deals into product they give tough competition to Transfer wise.
So, from the overall points discussed it can be said that the company is facing various strategic issues due to which their performance is going down and that is affecting the goodwill of the company. In addition to that the competitors who are already in the same like Paypal, Western Money Transfer they have marked a name in this area and that is giving major competition to the company
Challenges
Transfer Wise is basically a financial technology company based in London that has been delivering a greater amount of opportunity to the customers with its broad spectrum of converting money into cash and delivering a speedy transfer. As every company have a negative and a positive end to its profile. Similarly, Transfer-wise also has the great form of challenges which is resulting in eroding the fame of the company. It is basically a public company and has its own form of a website. Now speaking about the challenges of the company. Beginning from the initial stage when the company was established after seeing the need of transferring money overseas among the citizens of London who were charged too much. Therefore the founders came up with an idea to establish a business that could transfer money abroad quickly with an affordable range. But in this contemporary era, with an increase in population and the massive demands of commoners, sometimes mishaps do happen from the company end, which causes a major form of challenges that will be discussed in this study (Ya, 2020). As the company is focusing on earning revenue from different parts of the world, it is sometimes receiving massive threats because of the cultural profile of the country or through the competitive rivalry delivered by fintech companies from countries all around the world. Hence these challenges will be described in how establishing the business worldwide has caused the company to face challenges irrespective of its massive speed of transferring money.
- Speaking about Transfer wise, it has expanded its branches in some parts of the world like Europe and many others and has successfully established a solid position in the financial marketplace. The company earned a greater profit during the time of 2018-2020, and it got a consumer hike of around 50% on a CAGAr basis. However, the company started facing challenges after 2020 when the growth rates of the company started falling down and it is not as same as it used to be before.
- For example- in European states, Transfer Wise had successfully established its business before where it gained the maximum amount of profit, but during the present times, the growth of the company in the European region has been shopping down rapidly. While here, the major challenge which the company is facing is the competitive threats from the other new entrants in the market, which has been attracting the customers' attention and gradually degrading Transfer wise position (Kilu et al. 2019). In a recent media coverage done by FXC intelligence, it is observed that the slowing down in the top-line growth of the company is delivering a massive amount of pressure on the revenue growth of transfer wise which is not at all healthy for the company's profitability. This is one of the major challenges which the company is facing in the present times. If the company doesn't expand its value position in the market and continues to keep up the fame of sloping down the growth, then there is a greater amount of fear of getting bankrupted and ending with a massive loss. The investors of Transfer wise expect that as Transferwise has completed 10 years in the market, therefore it has the potential to make further growth in the future easily if they tend to establish newer methods and strategies to incorporate in their business in terms of maintaining the profit rather leading it to the high extreme.
- Apart from that, it is found that the business in the areas of the Americana region and Asian- pacific region is comparatively smaller than the other countries can cause a major challenge. The reason behind it is that during the time period of 2020, the company has only earned 6% of the total revenue in this region, which is comparatively less than Europe and London. Therefore this is one of the major challenges the company is facing as the region of America has the highest market growth, and there, the company is only earning a smaller amount of profit (Ayodele, 2018).
- Speaking about Africa, the company has established its part but is facing challenges. The reason behind it is that Africa has many companies which are based on financial money transfers which have caused the growth of those companies in the country. Apart from that, the population of Africa mainly prefers to choose companies of their country's origin which are harming the profile of Transfer Wise in terms of extensive competition from the other companies of African origin. Transfer wish has failed to understand the needs and demands of the African population, which has created a disruption in creating a link between the company and the customers. Whereas the African population mainly prefers cash or mobile wallets rather than transferring money through the app. Hence the African population is ignoring the app and proceeding with their own
