Sanford C. Bernstein: The Fork in the Road (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Sanford C. Bernstein: The Fork in the Road (A)
Soon after the death of the firm's legendary founder, the individuals then serving as chairman and as president--Lewis A. Sanders and Roger Hertog, respectively--talked about the future of their firm. Sanford C. Bernstein & Co., a private investment firm, had grown rapidly in customers, assets under management, and personnel during the previous decade. Its institutional research department, which performed equity research for distribution to major money managers around the world, was considered one of the best such sources in the industry. Its own money management business managed $87.4 billion in 1999. However, as market conditions became more challenging for value-based managers during the late 1990s, the firm's most important portfolios were underperforming their benchmarks. Also, although the investment management industry had grown, it had also consolidated. The firm was facing some issues: How would it be affected by its founder's death? What was its competitive advantage? Does the firm's underlying value system have to change in a new competitive environment? Rumors were circulating about Bernstein going public in the future, merging, or being acquired. Should the firm even consider any of these options? How much was the firm worth?
Swot Analysis of "Sanford C. Bernstein: The Fork in the Road (A)" written by Boris Groysberg, Anahita Hashemi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bernstein Sanford facing as an external strategic factors. Some of the topics covered in Sanford C. Bernstein: The Fork in the Road (A) case study are - Strategic Management Strategies, Entrepreneurship, Financial analysis, Financial management, Human resource management, Leadership, Mergers & acquisitions, Organizational culture and Organizational Development.
Some of the macro environment factors that can be used to understand the Sanford C. Bernstein: The Fork in the Road (A) casestudy better are - – increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, geopolitical disruptions, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic ,
talent flight as more people leaving formal jobs, wage bills are increasing, etc
Introduction to SWOT Analysis of Sanford C. Bernstein: The Fork in the Road (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Sanford C. Bernstein: The Fork in the Road (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bernstein Sanford, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bernstein Sanford 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 Sanford C. Bernstein: The Fork in the Road (A) can be done for the following purposes –
1. Strategic planning using facts provided in Sanford C. Bernstein: The Fork in the Road (A) case study
2. Improving business portfolio management of Bernstein Sanford
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 Bernstein Sanford
Strengths Sanford C. Bernstein: The Fork in the Road (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bernstein Sanford in Sanford C. Bernstein: The Fork in the Road (A) Harvard Business Review case study are -
Sustainable margins compare to other players in Organizational Development industry
– Sanford C. Bernstein: The Fork in the Road (A) firm has clearly differentiated products in the market place. This has enabled Bernstein Sanford to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Bernstein Sanford to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Bernstein Sanford in the sector have low bargaining power. Sanford C. Bernstein: The Fork in the Road (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bernstein Sanford to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Bernstein Sanford is one of the most innovative firm in sector. Manager in Sanford C. Bernstein: The Fork in the Road (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High brand equity
– Bernstein Sanford has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bernstein Sanford to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Bernstein Sanford 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 Boris Groysberg, Anahita Hashemi 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.
Ability to lead change in Organizational Development field
– Bernstein Sanford 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 Bernstein Sanford in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Bernstein Sanford is one of the leading recruiters in the industry. Managers in the Sanford C. Bernstein: The Fork in the Road (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Sanford C. Bernstein: The Fork in the Road (A) 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.
Superior customer experience
– The customer experience strategy of Bernstein Sanford in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Bernstein Sanford 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 Sanford C. Bernstein: The Fork in the Road (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Bernstein Sanford
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bernstein Sanford 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 Bernstein Sanford 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.
Weaknesses Sanford C. Bernstein: The Fork in the Road (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sanford C. Bernstein: The Fork in the Road (A) are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Sanford C. Bernstein: The Fork in the Road (A), in the dynamic environment Bernstein Sanford has struggled to respond to the nimble upstart competition. Bernstein Sanford has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bernstein Sanford is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Sanford C. Bernstein: The Fork in the Road (A) 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 Sanford C. Bernstein: The Fork in the Road (A), 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.
Interest costs
– Compare to the competition, Bernstein Sanford 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.
Increasing silos among functional specialists
– The organizational structure of Bernstein Sanford is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Bernstein Sanford needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bernstein Sanford 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, Bernstein Sanford 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Sanford C. Bernstein: The Fork in the Road (A), is just above the industry average. Bernstein Sanford 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.
Lack of clear differentiation of Bernstein Sanford products
– To increase the profitability and margins on the products, Bernstein Sanford needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Bernstein Sanford supply chain. Even after few cautionary changes mentioned in the HBR case study - Sanford C. Bernstein: The Fork in the Road (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Bernstein Sanford vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Sanford C. Bernstein: The Fork in the Road (A) 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 Bernstein Sanford 's lucrative customers.
Products dominated business model
– Even though Bernstein Sanford 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 - Sanford C. Bernstein: The Fork in the Road (A) should strive to include more intangible value offerings along with its core products and services.
Opportunities Sanford C. Bernstein: The Fork in the Road (A) | 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 Sanford C. Bernstein: The Fork in the Road (A) are -
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 Bernstein Sanford in the consumer business. Now Bernstein Sanford can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Bernstein Sanford has opened avenues for new revenue streams for the organization in the industry. This can help Bernstein Sanford to build a more holistic ecosystem as suggested in the Sanford C. Bernstein: The Fork in the Road (A) case study. Bernstein Sanford can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bernstein Sanford 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.
Manufacturing automation
– Bernstein Sanford 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.
Developing new processes and practices
– Bernstein Sanford 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.
Building a culture of innovation
– managers at Bernstein Sanford 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bernstein Sanford can use these opportunities to build new business models that can help the communities that Bernstein Sanford operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Bernstein Sanford 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, Sanford C. Bernstein: The Fork in the Road (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Bernstein Sanford 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. Bernstein Sanford 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.
Better consumer reach
– The expansion of the 5G network will help Bernstein Sanford to increase its market reach. Bernstein Sanford 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.
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. Bernstein Sanford can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Bernstein Sanford 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.
Leveraging digital technologies
– Bernstein Sanford 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.
Threats Sanford C. Bernstein: The Fork in the Road (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Sanford C. Bernstein: The Fork in the Road (A) are -
Consumer confidence and its impact on Bernstein Sanford 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.
Increasing wage structure of Bernstein Sanford
– 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 Bernstein Sanford.
Technology acceleration in Forth Industrial Revolution
– Bernstein Sanford has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Bernstein Sanford 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.
Stagnating economy with rate increase
– Bernstein Sanford 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 Bernstein Sanford in the Organizational Development sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bernstein Sanford 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 Sanford C. Bernstein: The Fork in the Road (A) .
High dependence on third party suppliers
– Bernstein Sanford 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.
Shortening product life cycle
– it is one of the major threat that Bernstein Sanford is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Regulatory challenges
– Bernstein Sanford 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bernstein Sanford with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Sanford C. Bernstein: The Fork in the Road (A), Bernstein Sanford 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bernstein Sanford 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.
Weighted SWOT Analysis of Sanford C. Bernstein: The Fork in the Road (A) 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 Sanford C. Bernstein: The Fork in the Road (A) 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 Sanford C. Bernstein: The Fork in the Road (A) 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 Sanford C. Bernstein: The Fork in the Road (A) 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 Sanford C. Bernstein: The Fork in the Road (A) 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 Bernstein Sanford needs to make to build a sustainable competitive advantage.
