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Synchrony Financial

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Yale School of Management
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When Synchrony Financial came into existence in 2014, the company was part start-up, part established financial giant. For 80 years, Synchrony's businesses had been part of General Electric, until GE spun off the entity. It fell to Margaret Keane, Synchrony's first CEO, to integrate the best of the company's legacy with new practices. Especially, she looked for new practices that would help Synchrony attract millennials, whose employment expectations, credit needs, and retail preferences appeared to differ from the previous generations.

Synchrony was the largest issuer of private label credit cards in the United States based on purchase volume and receivables. During 2013, Synchrony financed $93.9 billion of purchase volume and at March 31, 2014, the company had $54.3 billion of loan receivables and 57.3 million active accounts. In the year before the July 2014 IPO, GE Consumer Finance recorded over $3.1 billion in pretax earnings.

Keane had been the last leader GE's retail card division and became Synchrony's first CEO. She had 12,000 employees to manage and a substantial portfolio of contracts. She also inherited employees steeped in a GE culture that emphasized rigorous planning and management development.

But Keane also saw that the competitive landscape was changing. The generation that came of age after 2000 appeared to differ from previous generations. For Synchrony to succeed, the company had to accommodate these millennials as employees, customers, and retail partners, while retaining its substantial base.

First, Keane had to devise ways of attracting the top young talent to the company at a time when legacy financial services companies had lost their luster as employers. And once at Synchrony, she had to make sure the insights of these young employees were utilized in formulating new products and services.

Keane also was concerned about rising competition from new fintech companies that seemed to have captured the credit preferences of millennials with their products. How could Synchrony change its offerings to better suit millennial spending habits?

Published Date: 31/03/2017

Suggested Citation: Jeffrey A. Sonnenfeld, Jaan Elias, and Jean Rosenthal, "Synchrony Financial," Yale SOM Case 17-012, March 31, 2017

Keywords: fintech, banking, store cards, General Electric Capital, retail, millennials, Women in Leadership