Case Study Description of Momentum and Metropolitan's Merger: Authentic Transformational Leadership
The merger of Momentum and Metropolitan into MMI Holdings Limited, one of South Africa's largest insurers, played out against the setting of South Africa's volatile currency and post-apartheid environment, with sensitive employees and a Competition Tribunal that prohibited the retrenchment of around 2,000 employees. The two companies with very different cultures were merged, with only one of the CEOs attaining the Group CEO position. The leaders' clear vision and focus on change management enabled a successful merger process. How can the Group CEO derive synergies and grow capital from the integration's next phase to prevent MMI from becoming another merger that fails to provide returns for shareholders? Caren Scheepers is affiliated with University of Pretoria.
Swot Analysis of "Momentum and Metropolitan's Merger: Authentic Transformational Leadership" written by Caren Scheepers, Sonja Swart includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mmi Merger facing as an external strategic factors. Some of the topics covered in Momentum and Metropolitan's Merger: Authentic Transformational Leadership case study are - Strategic Management Strategies, Mergers & acquisitions and Organizational Development.
Some of the macro environment factors that can be used to understand the Momentum and Metropolitan's Merger: Authentic Transformational Leadership casestudy better are - – cloud computing is disrupting traditional business models, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic ,
increasing energy prices, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Momentum and Metropolitan's Merger: Authentic Transformational Leadership
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Momentum and Metropolitan's Merger: Authentic Transformational Leadership case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mmi Merger, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mmi Merger 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.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Momentum and Metropolitan's Merger: Authentic Transformational Leadership can be done for the following purposes –
1. Strategic planning using facts provided in Momentum and Metropolitan's Merger: Authentic Transformational Leadership case study
2. Improving business portfolio management of Mmi Merger
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Mmi Merger
Strengths Momentum and Metropolitan's Merger: Authentic Transformational Leadership | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mmi Merger in Momentum and Metropolitan's Merger: Authentic Transformational Leadership Harvard Business Review case study are -
Innovation driven organization
– Mmi Merger is one of the most innovative firm in sector. Manager in Momentum and Metropolitan's Merger: Authentic Transformational Leadership Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Organizational Development industry
– Momentum and Metropolitan's Merger: Authentic Transformational Leadership firm has clearly differentiated products in the market place. This has enabled Mmi Merger to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Mmi Merger to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Mmi Merger in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Mmi Merger 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 Momentum and Metropolitan's Merger: Authentic Transformational Leadership - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Mmi Merger in the sector have low bargaining power. Momentum and Metropolitan's Merger: Authentic Transformational Leadership has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mmi Merger to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Mmi Merger 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.
Training and development
– Mmi Merger has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Momentum and Metropolitan's Merger: Authentic Transformational Leadership 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.
High brand equity
– Mmi Merger has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mmi Merger to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the Momentum and Metropolitan's Merger: Authentic Transformational Leadership Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Mmi Merger digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mmi Merger has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Highly skilled collaborators
– Mmi Merger 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 Momentum and Metropolitan's Merger: Authentic Transformational Leadership HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Mmi Merger is present in almost all the verticals within the industry. This has provided firm in Momentum and Metropolitan's Merger: Authentic Transformational Leadership case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Weaknesses Momentum and Metropolitan's Merger: Authentic Transformational Leadership | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Momentum and Metropolitan's Merger: Authentic Transformational Leadership are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Momentum and Metropolitan's Merger: Authentic Transformational Leadership 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 Mmi Merger has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Momentum and Metropolitan's Merger: Authentic Transformational Leadership, in the dynamic environment Mmi Merger has struggled to respond to the nimble upstart competition. Mmi Merger has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Mmi Merger 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Momentum and Metropolitan's Merger: Authentic Transformational Leadership, is just above the industry average. Mmi Merger needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Products dominated business model
– Even though Mmi Merger 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 - Momentum and Metropolitan's Merger: Authentic Transformational Leadership should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Mmi Merger, firm in the HBR case study Momentum and Metropolitan's Merger: Authentic Transformational Leadership needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Mmi Merger has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Mmi Merger even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Mmi Merger supply chain. Even after few cautionary changes mentioned in the HBR case study - Momentum and Metropolitan's Merger: Authentic Transformational Leadership, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Mmi Merger vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Mmi Merger 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, Mmi Merger is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Momentum and Metropolitan's Merger: Authentic Transformational Leadership can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Momentum and Metropolitan's Merger: Authentic Transformational Leadership, it seems that the employees of Mmi Merger 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.
Opportunities Momentum and Metropolitan's Merger: Authentic Transformational Leadership | 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 Momentum and Metropolitan's Merger: Authentic Transformational Leadership 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, Mmi Merger can use these opportunities to build new business models that can help the communities that Mmi Merger operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Building a culture of innovation
– managers at Mmi Merger 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 Organizational Development segment.
Using analytics as competitive advantage
– Mmi Merger 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 Momentum and Metropolitan's Merger: Authentic Transformational Leadership - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mmi Merger to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Mmi Merger can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Momentum and Metropolitan's Merger: Authentic Transformational Leadership suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mmi Merger 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
– Mmi Merger 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mmi Merger in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Mmi Merger can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Mmi Merger has opened avenues for new revenue streams for the organization in the industry. This can help Mmi Merger to build a more holistic ecosystem as suggested in the Momentum and Metropolitan's Merger: Authentic Transformational Leadership case study. Mmi Merger can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Mmi Merger to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
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 Mmi Merger 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Mmi Merger can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Momentum and Metropolitan's Merger: Authentic Transformational Leadership, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Mmi Merger can use the latest technology developments to improve its manufacturing and designing process in Organizational Development 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.
Threats Momentum and Metropolitan's Merger: Authentic Transformational Leadership External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Momentum and Metropolitan's Merger: Authentic Transformational Leadership are -
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 Mmi Merger.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mmi Merger in the Organizational Development industry. The Organizational Development 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.
Consumer confidence and its impact on Mmi Merger demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Regulatory challenges
– Mmi Merger 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 Organizational Development industry regulations.
Technology acceleration in Forth Industrial Revolution
– Mmi Merger has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Mmi Merger needs to keep up with the evolution of technology in the Organizational Development 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.
Increasing wage structure of Mmi Merger
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Mmi Merger.
Environmental challenges
– Mmi Merger 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. Mmi Merger can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Mmi Merger business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Mmi Merger 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.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Mmi Merger can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Momentum and Metropolitan's Merger: Authentic Transformational Leadership, Mmi Merger may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
Stagnating economy with rate increase
– Mmi Merger 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.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Mmi Merger in the Organizational Development sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Momentum and Metropolitan's Merger: Authentic Transformational Leadership 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 Momentum and Metropolitan's Merger: Authentic Transformational Leadership 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 Momentum and Metropolitan's Merger: Authentic Transformational Leadership 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 Momentum and Metropolitan's Merger: Authentic Transformational Leadership 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 Momentum and Metropolitan's Merger: Authentic Transformational Leadership 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 Mmi Merger needs to make to build a sustainable competitive advantage.
