Compensation Plans at Pearson & Daye Securities SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Compensation Plans at Pearson & Daye Securities
In 2003 Harry Pearson and James Daye established - along with three other equity partners - a boutique investment banking firm with an entrepreneurial, informal office culture that delivered high quality customer service. In so doing, they offered a streamlined compensation plan that, in their view, would directly and fairly reward their employees' performance. However, as the firm grew, some members of their staff sought a more transparent process by which to measure their progress and the associated financial benefits - as well as the possibility to acquire equity in the firm. What compensation scheme would allow Pearson and Daye to reward their valued employees without losing sight of their initial goals? And how much would the five original partners consider diluting their holdings?
Swot Analysis of "Compensation Plans at Pearson & Daye Securities" written by Ann Bartel, Maria Guadalupe includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Daye Pearson facing as an external strategic factors. Some of the topics covered in Compensation Plans at Pearson & Daye Securities case study are - Strategic Management Strategies, Motivating people, Performance measurement and Organizational Development.
Some of the macro environment factors that can be used to understand the Compensation Plans at Pearson & Daye Securities casestudy better are - – there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, increasing commodity prices, increasing energy prices, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%,
challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Compensation Plans at Pearson & Daye Securities
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Compensation Plans at Pearson & Daye Securities case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Daye Pearson, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Daye Pearson 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 Compensation Plans at Pearson & Daye Securities can be done for the following purposes –
1. Strategic planning using facts provided in Compensation Plans at Pearson & Daye Securities case study
2. Improving business portfolio management of Daye Pearson
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 Daye Pearson
Strengths Compensation Plans at Pearson & Daye Securities | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Daye Pearson in Compensation Plans at Pearson & Daye Securities Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Compensation Plans at Pearson & Daye Securities 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.
High brand equity
– Daye Pearson has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Daye Pearson to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Daye Pearson 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 Compensation Plans at Pearson & Daye Securities HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Daye Pearson in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Daye Pearson 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.
Analytics focus
– Daye Pearson is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Ann Bartel, Maria Guadalupe can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Daye Pearson digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Daye Pearson 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.
Strong track record of project management
– Daye Pearson is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Daye Pearson is one of the leading recruiters in the industry. Managers in the Compensation Plans at Pearson & Daye Securities are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Organizational Development field
– Daye Pearson 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 Daye Pearson in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Daye Pearson has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Compensation Plans at Pearson & Daye Securities 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.
Innovation driven organization
– Daye Pearson is one of the most innovative firm in sector. Manager in Compensation Plans at Pearson & Daye Securities Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Compensation Plans at Pearson & Daye Securities | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Compensation Plans at Pearson & Daye Securities are -
Increasing silos among functional specialists
– The organizational structure of Daye Pearson is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Daye Pearson needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Daye Pearson to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Daye Pearson 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.
Skills based hiring
– The stress on hiring functional specialists at Daye Pearson 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.
Slow decision making process
– As mentioned earlier in the report, Daye Pearson 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. Daye Pearson 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 bargaining power of channel partners
– Because of the regulatory requirements, Ann Bartel, Maria Guadalupe suggests that, Daye Pearson 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Compensation Plans at Pearson & Daye Securities 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 Daye Pearson 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Compensation Plans at Pearson & Daye Securities, in the dynamic environment Daye Pearson has struggled to respond to the nimble upstart competition. Daye Pearson 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 Compensation Plans at Pearson & Daye Securities 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 Compensation Plans at Pearson & Daye Securities can leverage the sales team experience to cultivate customer relationships as Daye Pearson is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Compensation Plans at Pearson & Daye Securities, it seems that the employees of Daye Pearson 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Compensation Plans at Pearson & Daye Securities 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 Daye Pearson has relatively successful track record of launching new products.
Products dominated business model
– Even though Daye Pearson 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 - Compensation Plans at Pearson & Daye Securities should strive to include more intangible value offerings along with its core products and services.
Opportunities Compensation Plans at Pearson & Daye Securities | 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 Compensation Plans at Pearson & Daye Securities are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Daye Pearson 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 Daye Pearson to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Daye Pearson can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Compensation Plans at Pearson & Daye Securities 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Daye Pearson 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, Compensation Plans at Pearson & Daye Securities, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Daye Pearson 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Daye Pearson 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. Daye Pearson 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.
Learning at scale
– Online learning technologies has now opened space for Daye Pearson 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.
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. Daye Pearson can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Daye Pearson 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.
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 Daye Pearson 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Daye Pearson can use these opportunities to build new business models that can help the communities that Daye Pearson operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Building a culture of innovation
– managers at Daye Pearson 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
– Daye Pearson 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 Compensation Plans at Pearson & Daye Securities - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Daye Pearson to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Daye Pearson to increase its market reach. Daye Pearson 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.
Threats Compensation Plans at Pearson & Daye Securities External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Compensation Plans at Pearson & Daye Securities are -
Regulatory challenges
– Daye Pearson 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.
Environmental challenges
– Daye Pearson 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. Daye Pearson can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Daye Pearson 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 Compensation Plans at Pearson & Daye Securities .
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. Daye Pearson 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.
Increasing wage structure of Daye Pearson
– 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 Daye Pearson.
Consumer confidence and its impact on Daye Pearson 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.
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 Daye Pearson in the Organizational Development sector and impact the bottomline of the organization.
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 Daye Pearson.
Shortening product life cycle
– it is one of the major threat that Daye Pearson is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Daye Pearson 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Daye Pearson with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Daye Pearson 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.
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. Daye Pearson can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Compensation Plans at Pearson & Daye Securities 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 Compensation Plans at Pearson & Daye Securities 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 Compensation Plans at Pearson & Daye Securities 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 Compensation Plans at Pearson & Daye Securities 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 Compensation Plans at Pearson & Daye Securities 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 Daye Pearson needs to make to build a sustainable competitive advantage.
