Ingrid Johnson and Nedbank Business Banking SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Ingrid Johnson and Nedbank Business Banking
To maximize their effectiveness, color cases should be printed in color.This case discusses the issue of leading change at the business banking division of Nedbank, a prominent South African bank, between 2005 and 2009. (This timeframe, beginning just 11 years after Apartheid's end, covers Ingrid Johnson's leadership of this division during a period of significant change within Nedbank and South Africa). One of the oldest banks in South Africa, Nedbank merged with another South African bank in 2002. Troubles financing the acquisition and several ill-advised bets in the market caused Nedbank's market value to plummet and led to the ouster of the bank's senior leadership. The business banking division was one of Nedbank's largest business units with 2000+ staff. For many years, it had been a consistently profitable but underperforming division, and had yet to fully implement a strategic restructuring when Johnson takes over in 2005. Johnson's mandate is to instill a high performance culture, which she determines requires overhauling the division's culture, formal organization, critical tasks, and people. The class discussion focuses on what Johnson did to lead the change effort, what worked, what did not, and what more she needs to do. The case and associated video nicely describe Ingrid's leadership style shifting from a chartered accountant to a more seasoned leader. The video shows Ingrid interacting with AMP participants. Ingrid describes what she did in Business Banking, how she executed those changes, what she learned about leading large system change, and what she learned about herself as a leader.
Swot Analysis of "Ingrid Johnson and Nedbank Business Banking" written by Michael L. Tushman, David Kiron includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ingrid Nedbank facing as an external strategic factors. Some of the topics covered in Ingrid Johnson and Nedbank Business Banking case study are - Strategic Management Strategies, Leadership, Leading teams, Organizational structure, Strategy execution and Organizational Development.
Some of the macro environment factors that can be used to understand the Ingrid Johnson and Nedbank Business Banking casestudy better are - – increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion,
increasing commodity prices, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Ingrid Johnson and Nedbank Business Banking
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ingrid Johnson and Nedbank Business Banking case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ingrid Nedbank, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ingrid Nedbank 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 Ingrid Johnson and Nedbank Business Banking can be done for the following purposes –
1. Strategic planning using facts provided in Ingrid Johnson and Nedbank Business Banking case study
2. Improving business portfolio management of Ingrid Nedbank
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 Ingrid Nedbank
Strengths Ingrid Johnson and Nedbank Business Banking | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ingrid Nedbank in Ingrid Johnson and Nedbank Business Banking Harvard Business Review case study are -
Learning organization
- Ingrid Nedbank is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Ingrid Nedbank is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Ingrid Johnson and Nedbank Business Banking Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Organizational Development field
– Ingrid Nedbank 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 Ingrid Nedbank in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Ingrid Nedbank is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High brand equity
– Ingrid Nedbank has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ingrid Nedbank to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Ingrid Nedbank in the sector have low bargaining power. Ingrid Johnson and Nedbank Business Banking has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ingrid Nedbank to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Ingrid Nedbank digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ingrid Nedbank 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
– Ingrid Nedbank 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 Ingrid Johnson and Nedbank Business Banking HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Ingrid Johnson and Nedbank Business Banking 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.
Cross disciplinary teams
– Horizontal connected teams at the Ingrid Nedbank 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.
High switching costs
– The high switching costs that Ingrid Nedbank 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.
Superior customer experience
– The customer experience strategy of Ingrid Nedbank in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Ingrid Nedbank has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ingrid Johnson and Nedbank Business Banking 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.
Weaknesses Ingrid Johnson and Nedbank Business Banking | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ingrid Johnson and Nedbank Business Banking are -
Skills based hiring
– The stress on hiring functional specialists at Ingrid Nedbank has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study Ingrid Johnson and Nedbank Business Banking 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 Ingrid Nedbank 's lucrative customers.
Aligning sales with marketing
– It come across in the case study Ingrid Johnson and Nedbank Business Banking 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 Ingrid Johnson and Nedbank Business Banking can leverage the sales team experience to cultivate customer relationships as Ingrid Nedbank is planning to shift buying processes online.
Slow to strategic competitive environment developments
– As Ingrid Johnson and Nedbank Business Banking HBR case study mentions - Ingrid Nedbank 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.
High cash cycle compare to competitors
Ingrid Nedbank 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 star products
– The top 2 products and services of the firm as mentioned in the Ingrid Johnson and Nedbank Business Banking 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 Ingrid Nedbank has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Ingrid Nedbank 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 decision making process
– As mentioned earlier in the report, Ingrid Nedbank 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. Ingrid Nedbank 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Ingrid Johnson and Nedbank Business Banking, in the dynamic environment Ingrid Nedbank has struggled to respond to the nimble upstart competition. Ingrid Nedbank has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Ingrid Nedbank 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.
Need for greater diversity
– Ingrid Nedbank has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Opportunities Ingrid Johnson and Nedbank Business Banking | 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 Ingrid Johnson and Nedbank Business Banking are -
Using analytics as competitive advantage
– Ingrid Nedbank 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 Ingrid Johnson and Nedbank Business Banking - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ingrid Nedbank to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Ingrid Nedbank has opened avenues for new revenue streams for the organization in the industry. This can help Ingrid Nedbank to build a more holistic ecosystem as suggested in the Ingrid Johnson and Nedbank Business Banking case study. Ingrid Nedbank can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Ingrid Nedbank 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, Ingrid Nedbank can use these opportunities to build new business models that can help the communities that Ingrid Nedbank operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Learning at scale
– Online learning technologies has now opened space for Ingrid Nedbank 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. Ingrid Nedbank can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Ingrid Nedbank 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. Ingrid Nedbank 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Ingrid Nedbank 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.
Manufacturing automation
– Ingrid Nedbank 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ingrid Nedbank can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Ingrid Nedbank 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ingrid Nedbank is facing challenges because of the dominance of functional experts in the organization. Ingrid Johnson and Nedbank Business Banking 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.
Building a culture of innovation
– managers at Ingrid Nedbank 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.
Threats Ingrid Johnson and Nedbank Business Banking External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ingrid Johnson and Nedbank Business Banking are -
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.
Stagnating economy with rate increase
– Ingrid Nedbank 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.
Consumer confidence and its impact on Ingrid Nedbank 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ingrid Nedbank with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ingrid Nedbank 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 Ingrid Johnson and Nedbank Business Banking .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Ingrid Johnson and Nedbank Business Banking, Ingrid Nedbank 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 .
High dependence on third party suppliers
– Ingrid Nedbank 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.
Increasing wage structure of Ingrid Nedbank
– 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 Ingrid Nedbank.
Environmental challenges
– Ingrid Nedbank 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. Ingrid Nedbank can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Regulatory challenges
– Ingrid Nedbank 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.
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 Ingrid Nedbank business can come under increasing regulations regarding data privacy, data security, etc.
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. Ingrid Nedbank 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.
Weighted SWOT Analysis of Ingrid Johnson and Nedbank Business Banking 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 Ingrid Johnson and Nedbank Business Banking 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 Ingrid Johnson and Nedbank Business Banking 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 Ingrid Johnson and Nedbank Business Banking 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 Ingrid Johnson and Nedbank Business Banking 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 Ingrid Nedbank needs to make to build a sustainable competitive advantage.
