Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead

By 2017, higher education is expected to be a $2 trillion industry worldwide. Within this huge economic engine, the boards of trustees that provide governance to universities and colleges face a complex challenge in that they must serve a variety of stakeholders. Without effective governance, an academic institution's performance is likely to suffer. Penn State University is plagued by an ineffective board of trustees. As a complement to past work that has documented this board's unwise and costly decisions, we examine how five design issues--board size, board composition, fiduciary responsibility, term limits, and transparency--helped create a culture in which poor choices were more likely to occur. We discuss why the board's recent self-imposed reforms are inadequate. We then offer more substantive reforms that could fix the Penn State board's flaws. In particular, we recommend that academic boards should be (1) small enough to allow full participation of all members, (2) composed such that no one stakeholder group can dominate decision making, (3) designed to eliminate actual and perceived conflicts of interest, (4) governed by term limits, and (5) appropriately transparent in their strategic decision making and communications. We leverage these principles to propose a reduction of the Penn State board from 30 voting members to 19. More broadly, other academic boards might benefit from undergoing a self-analysis based on the Penn State case.

Authors :: David Ketchen Jr., Charles C. Snow, Alice W. Pope

Topics :: Leadership & Managing People

Tags :: Leadership, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead" written by David Ketchen Jr., Charles C. Snow, Alice W. Pope includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Penn Board's facing as an external strategic factors. Some of the topics covered in Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead case study are - Strategic Management Strategies, Leadership and Leadership & Managing People.

Some of the macro environment factors that can be used to understand the Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead casestudy better are - – cloud computing is disrupting traditional business models, technology disruption, increasing government debt because of Covid-19 spendings, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs, geopolitical disruptions, increasing commodity prices, talent flight as more people leaving formal jobs, etc

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Introduction to SWOT Analysis of Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Penn Board's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Penn Board's operates in.

According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead can be done for the following purposes –
1. Strategic planning using facts provided in Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead case study
2. Improving business portfolio management of Penn Board's
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Penn Board's

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Strengths Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Penn Board's in Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead Harvard Business Review case study are -

High switching costs

– The high switching costs that Penn Board's has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.

Cross disciplinary teams

– Horizontal connected teams at the Penn Board's are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.

Sustainable margins compare to other players in Leadership & Managing People industry

– Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead firm has clearly differentiated products in the market place. This has enabled Penn Board's to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Penn Board's to invest into research and development (R&D) and innovation.

Superior customer experience

– The customer experience strategy of Penn Board's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Highly skilled collaborators

– Penn Board's has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Successful track record of launching new products

– Penn Board's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Penn Board's has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.

Training and development

– Penn Board's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.

Strong track record of project management

– Penn Board's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Effective Research and Development (R&D)

– Penn Board's has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Innovation driven organization

– Penn Board's is one of the most innovative firm in sector. Manager in Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

Ability to recruit top talent

– Penn Board's is one of the leading recruiters in the industry. Managers in the Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

High brand equity

– Penn Board's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Penn Board's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

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Weaknesses Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead are -

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead, in the dynamic environment Penn Board's has struggled to respond to the nimble upstart competition. Penn Board's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Skills based hiring

– The stress on hiring functional specialists at Penn Board's has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.

High dependence on star products

– The top 2 products and services of the firm as mentioned in the Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Penn Board's has relatively successful track record of launching new products.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead, it seems that the employees of Penn Board's don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.

High operating costs

– Compare to the competitors, firm in the HBR case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Penn Board's 's lucrative customers.

Lack of clear differentiation of Penn Board's products

– To increase the profitability and margins on the products, Penn Board's needs to provide more differentiated products than what it is currently offering in the marketplace.

High cash cycle compare to competitors

Penn Board's has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

Workers concerns about automation

– As automation is fast increasing in the segment, Penn Board's needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Penn Board's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

No frontier risks strategy

– After analyzing the HBR case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.

Products dominated business model

– Even though Penn Board's has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead should strive to include more intangible value offerings along with its core products and services.

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Opportunities Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities highlighted in the Harvard Business Review case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead are -

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Penn Board's can use these opportunities to build new business models that can help the communities that Penn Board's operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.

Manufacturing automation

– Penn Board's can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Penn Board's to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Penn Board's to hire the very best people irrespective of their geographical location.

Low interest rates

– Even though inflation is raising its head in most developed economies, Penn Board's can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.

Loyalty marketing

– Penn Board's has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.

Using analytics as competitive advantage

– Penn Board's has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Penn Board's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Changes in consumer behavior post Covid-19

– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Penn Board's can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Penn Board's can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.

Developing new processes and practices

– Penn Board's can develop new processes and procedures in Leadership & Managing People industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.

Reconfiguring business model

– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Penn Board's to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.

Building a culture of innovation

– managers at Penn Board's can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Penn Board's is facing challenges because of the dominance of functional experts in the organization. Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Creating value in data economy

– The success of analytics program of Penn Board's has opened avenues for new revenue streams for the organization in the industry. This can help Penn Board's to build a more holistic ecosystem as suggested in the Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead case study. Penn Board's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Better consumer reach

– The expansion of the 5G network will help Penn Board's to increase its market reach. Penn Board's will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.

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Threats Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead are -

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Penn Board's in the Leadership & Managing People industry. The Leadership & Managing People industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Penn Board's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

Environmental challenges

– Penn Board's needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Penn Board's can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.

High dependence on third party suppliers

– Penn Board's high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.

Regulatory challenges

– Penn Board's needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Leadership & Managing People industry regulations.

Shortening product life cycle

– it is one of the major threat that Penn Board's is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

Stagnating economy with rate increase

– Penn Board's can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.

High level of anxiety and lack of motivation

– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Penn Board's needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.

Technology acceleration in Forth Industrial Revolution

– Penn Board's has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Penn Board's needs to keep up with the evolution of technology in the Leadership & Managing People sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.

Aging population

– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.

Instability in the European markets

– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Penn Board's will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.

Capital market disruption

– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Penn Board's.

Technology disruption because of hacks, piracy etc

– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.

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Weighted SWOT Analysis of Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants. We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –

First stage for doing weighted SWOT analysis of the case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.

Second stage for conducting weighted SWOT analysis of the Harvard case study Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.

Third stage of constructing weighted SWOT analysis of Flawed by design: Why Penn State's recent governance reforms won't work and what should be done instead is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Penn Board's needs to make to build a sustainable competitive advantage.

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