Furman Selz LLC (A): A Tale of Two Acquisitions SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Furman Selz LLC (A): A Tale of Two Acquisitions
Profiles a firm that was reacquired by two companies with different degrees of success. Highlights integration challenges present in acquisition deals when the primary assets of the target are human capital. Focuses on Furman Selz's acquisition by Xerox in 1987; its return to a private company in 1993; and a second acquisition, by ING, in 1997. In particular, provides the opportunity to evaluate five major corporate transitions: the initial launching as an independent firm, Furman Selz, in 1973; the shift to professional management in 1983-1986; the Xerox acquisition in 1987; the MBO in 1993; and the ING acquisition in 1997. Presents the transactions from multiple points of view: the founders and their associates; the professional managers brought in to advance the firm to the next level; the acquired firm under both Xerox and ING; and Xerox and ING themselves.
Authors :: Nancy Dean Beaulieu, Boris Groysberg, Kyle T. Doherty
Swot Analysis of "Furman Selz LLC (A): A Tale of Two Acquisitions" written by Nancy Dean Beaulieu, Boris Groysberg, Kyle T. Doherty includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ing Furman facing as an external strategic factors. Some of the topics covered in Furman Selz LLC (A): A Tale of Two Acquisitions case study are - Strategic Management Strategies, Financial analysis, Human resource management, Leadership, Mergers & acquisitions and Organizational Development.
Some of the macro environment factors that can be used to understand the Furman Selz LLC (A): A Tale of Two Acquisitions casestudy better are - – increasing energy prices, increasing transportation and logistics costs, wage bills are increasing, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs,
increasing commodity prices, technology disruption, etc
Introduction to SWOT Analysis of Furman Selz LLC (A): A Tale of Two Acquisitions
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Furman Selz LLC (A): A Tale of Two Acquisitions case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ing Furman, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ing Furman 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 Furman Selz LLC (A): A Tale of Two Acquisitions can be done for the following purposes –
1. Strategic planning using facts provided in Furman Selz LLC (A): A Tale of Two Acquisitions case study
2. Improving business portfolio management of Ing Furman
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 Ing Furman
Strengths Furman Selz LLC (A): A Tale of Two Acquisitions | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ing Furman in Furman Selz LLC (A): A Tale of Two Acquisitions Harvard Business Review case study are -
High brand equity
– Ing Furman has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ing Furman to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Organizational Development field
– Ing Furman is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Ing Furman in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Ing Furman is present in almost all the verticals within the industry. This has provided firm in Furman Selz LLC (A): A Tale of Two Acquisitions 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.
Superior customer experience
– The customer experience strategy of Ing Furman in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Ing Furman
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ing Furman does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Ing Furman 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 Organizational Development industry
– Furman Selz LLC (A): A Tale of Two Acquisitions firm has clearly differentiated products in the market place. This has enabled Ing Furman to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Ing Furman to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Furman Selz LLC (A): A Tale of Two Acquisitions 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.
Effective Research and Development (R&D)
– Ing Furman 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 Furman Selz LLC (A): A Tale of Two Acquisitions - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Ing Furman has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ing Furman 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.
Ability to recruit top talent
– Ing Furman is one of the leading recruiters in the industry. Managers in the Furman Selz LLC (A): A Tale of Two Acquisitions 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 switching costs
– The high switching costs that Ing Furman 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.
Weaknesses Furman Selz LLC (A): A Tale of Two Acquisitions | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Furman Selz LLC (A): A Tale of Two Acquisitions are -
No frontier risks strategy
– After analyzing the HBR case study Furman Selz LLC (A): A Tale of Two Acquisitions, it seems that company is thinking about the frontier risks that can impact Organizational Development 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.
Slow to strategic competitive environment developments
– As Furman Selz LLC (A): A Tale of Two Acquisitions HBR case study mentions - Ing Furman takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Skills based hiring
– The stress on hiring functional specialists at Ing Furman 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.
Capital Spending Reduction
– Even during the low interest decade, Ing Furman has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High bargaining power of channel partners
– Because of the regulatory requirements, Nancy Dean Beaulieu, Boris Groysberg, Kyle T. Doherty suggests that, Ing Furman is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Interest costs
– Compare to the competition, Ing Furman has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High cash cycle compare to competitors
Ing Furman 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.
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 Ing Furman supply chain. Even after few cautionary changes mentioned in the HBR case study - Furman Selz LLC (A): A Tale of Two Acquisitions, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ing Furman vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Furman Selz LLC (A): A Tale of Two Acquisitions, it seems that the employees of Ing Furman 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Furman Selz LLC (A): A Tale of Two Acquisitions, in the dynamic environment Ing Furman has struggled to respond to the nimble upstart competition. Ing Furman has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Furman Selz LLC (A): A Tale of Two Acquisitions that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Furman Selz LLC (A): A Tale of Two Acquisitions can leverage the sales team experience to cultivate customer relationships as Ing Furman is planning to shift buying processes online.
Opportunities Furman Selz LLC (A): A Tale of Two Acquisitions | 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 Furman Selz LLC (A): A Tale of Two Acquisitions are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ing Furman can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Ing Furman 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 Furman Selz LLC (A): A Tale of Two Acquisitions - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ing Furman to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ing Furman is facing challenges because of the dominance of functional experts in the organization. Furman Selz LLC (A): A Tale of Two Acquisitions 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.
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. Ing Furman can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Ing Furman can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Ing Furman can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ing Furman can use these opportunities to build new business models that can help the communities that Ing Furman operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ing Furman 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 Ing Furman to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Ing Furman to increase its market reach. Ing Furman 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.
Developing new processes and practices
– Ing Furman can develop new processes and procedures in Organizational Development 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Ing Furman in the consumer business. Now Ing Furman can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Ing Furman 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.
Learning at scale
– Online learning technologies has now opened space for Ing Furman 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.
Threats Furman Selz LLC (A): A Tale of Two Acquisitions External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Furman Selz LLC (A): A Tale of Two Acquisitions are -
Environmental challenges
– Ing Furman 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. Ing Furman can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
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.
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 Ing Furman in the Organizational Development sector and impact the bottomline of the organization.
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.
Technology acceleration in Forth Industrial Revolution
– Ing Furman has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Ing Furman 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.
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. Ing Furman needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
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. Ing Furman can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ing Furman with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Ing Furman.
Shortening product life cycle
– it is one of the major threat that Ing Furman is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Furman Selz LLC (A): A Tale of Two Acquisitions, Ing Furman 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 .
Increasing wage structure of Ing Furman
– 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 Ing Furman.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ing Furman can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Furman Selz LLC (A): A Tale of Two Acquisitions .
Weighted SWOT Analysis of Furman Selz LLC (A): A Tale of Two Acquisitions 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 Furman Selz LLC (A): A Tale of Two Acquisitions 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 Furman Selz LLC (A): A Tale of Two Acquisitions 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 Furman Selz LLC (A): A Tale of Two Acquisitions 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 Furman Selz LLC (A): A Tale of Two Acquisitions 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 Ing Furman needs to make to build a sustainable competitive advantage.
