Federal Reserve System is the Central bank of America formed by the Congress in1913 to provide the general public with a stable structure for financial activities. The FRS is an independent body within the confines of the government but with totally autonomous and independent controls. The FRS contains a network of twelve Federal Reserve Banks and their respective branches which had climbed up to twenty-five in 2004. These Reserve Banks serve as an operating face of the central banking system, where the public and private elements combine to form a solid organization. The FRS generates its income from the interest on U.S. government securities that it has acquired through open market operations, and through the interest of foreign currency investments or loans. After the FRS pays its expenses, the leftover amounts are turned into the U.S. Treasury.
The goals FRS wants to achieve are
- Stabilize the conditions using the monetary policy by influencing the monetary and credit conditions in the economy (FRS, 2005)
- Protecting the nation’s banking and financial system and to protect the credit rights of consumers (FRS, 2005)
- Providing financial services to depository institutions, the U.S. government, and foreign official institutions (FRS, 2005)
These goals are general goals that most firms would want to achieve being a part of the government. The only difference may be the profit earning part as FRS doesn’t have the goal of earning profit like most governmental institutions.
One goal that FRS wants to implement is to improve the decision making when new policies need to be made. This goal will be achieved through an excellent communicational channel that is always ‘on’ and connects all the board of governors and the board of directors of the banks. Most probably a information system will be used to coordinate everyone’s ideas and plans regarding new polices whenever a need arises.
Another goal that FRS wants to achieve is to maintain a high level of performance at the workplace. This can happen when the top authority of the FRS and its branches develops internal strengths and mitigate the weaknesses either by motivational tactics or by providing timely, honest and meaningful feedback. These actions will prompt the employees to improve their own performance and develop such systems that would improve the efficiency of the whole organizational network.
FRS (2005). Overview of the Federal Reserve System. Federal Reserve System. Accessed on May 17, 2008 from http://www.federalreserve.gov/pf/pf.htm