Northampton Group Inc.: How to Increase Shareholder Value SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Northampton Group Inc.: How to Increase Shareholder Value
The case examines the issues faced by a hotel management and development company as it tries to increase the return to its shareholders. The firm's major shareholders have commented that they believe the firm is currently under-valued, so management is considering several means of unlocking extra value. Due to difficult economic conditions resulting from the Global Economic Crisis, there are both many opportunities as well as many risks to the alternatives they are considering. The case provides both the opportunity to use several different valuation methods to determine if the company is, in fact, undervalued, as well as a discussion of several alternatives for unlocking value ranging from starting an active acquisition strategy, to re-organizing its corporate structure with either an updated capital structure or converting to a real estate income trust.
Swot Analysis of "Northampton Group Inc.: How to Increase Shareholder Value" written by Stephen Sapp, Kamal Patel includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Unlocking Northampton facing as an external strategic factors. Some of the topics covered in Northampton Group Inc.: How to Increase Shareholder Value case study are - Strategic Management Strategies, and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Northampton Group Inc.: How to Increase Shareholder Value casestudy better are - – there is increasing trade war between United States & China, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, increasing commodity prices,
talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Northampton Group Inc.: How to Increase Shareholder Value
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Northampton Group Inc.: How to Increase Shareholder Value case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Unlocking Northampton, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Unlocking Northampton 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 Northampton Group Inc.: How to Increase Shareholder Value can be done for the following purposes –
1. Strategic planning using facts provided in Northampton Group Inc.: How to Increase Shareholder Value case study
2. Improving business portfolio management of Unlocking Northampton
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Unlocking Northampton
Strengths Northampton Group Inc.: How to Increase Shareholder Value | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Unlocking Northampton in Northampton Group Inc.: How to Increase Shareholder Value Harvard Business Review case study are -
Effective Research and Development (R&D)
– Unlocking Northampton 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 Northampton Group Inc.: How to Increase Shareholder Value - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Unlocking Northampton 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 Northampton Group Inc.: How to Increase Shareholder Value HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Unlocking Northampton is present in almost all the verticals within the industry. This has provided firm in Northampton Group Inc.: How to Increase Shareholder Value 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.
Analytics focus
– Unlocking Northampton 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 Stephen Sapp, Kamal Patel 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.
Learning organization
- Unlocking Northampton 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 Unlocking Northampton is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Northampton Group Inc.: How to Increase Shareholder Value Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Unlocking Northampton in the sector have low bargaining power. Northampton Group Inc.: How to Increase Shareholder Value has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Unlocking Northampton to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Unlocking Northampton in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Unlocking Northampton
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Unlocking Northampton does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Unlocking Northampton 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.
Successful track record of launching new products
– Unlocking Northampton has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Unlocking Northampton 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.
Cross disciplinary teams
– Horizontal connected teams at the Unlocking Northampton 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.
Operational resilience
– The operational resilience strategy in the Northampton Group Inc.: How to Increase Shareholder Value 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.
Weaknesses Northampton Group Inc.: How to Increase Shareholder Value | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Northampton Group Inc.: How to Increase Shareholder Value are -
No frontier risks strategy
– After analyzing the HBR case study Northampton Group Inc.: How to Increase Shareholder Value, it seems that company is thinking about the frontier risks that can impact Finance & Accounting 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.
Skills based hiring
– The stress on hiring functional specialists at Unlocking Northampton 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Northampton Group Inc.: How to Increase Shareholder Value 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 Unlocking Northampton has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Northampton Group Inc.: How to Increase Shareholder Value, is just above the industry average. Unlocking Northampton 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.
Aligning sales with marketing
– It come across in the case study Northampton Group Inc.: How to Increase Shareholder Value 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 Northampton Group Inc.: How to Increase Shareholder Value can leverage the sales team experience to cultivate customer relationships as Unlocking Northampton is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Unlocking Northampton 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. Unlocking Northampton 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, Stephen Sapp, Kamal Patel suggests that, Unlocking Northampton 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Northampton Group Inc.: How to Increase Shareholder Value, in the dynamic environment Unlocking Northampton has struggled to respond to the nimble upstart competition. Unlocking Northampton has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Unlocking Northampton is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Unlocking Northampton needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Unlocking Northampton to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Unlocking Northampton, firm in the HBR case study Northampton Group Inc.: How to Increase Shareholder Value needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Unlocking Northampton supply chain. Even after few cautionary changes mentioned in the HBR case study - Northampton Group Inc.: How to Increase Shareholder Value, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Unlocking Northampton vulnerable to further global disruptions in South East Asia.
Opportunities Northampton Group Inc.: How to Increase Shareholder Value | 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 Northampton Group Inc.: How to Increase Shareholder Value 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 Unlocking Northampton in the consumer business. Now Unlocking Northampton can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Unlocking Northampton 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. Unlocking Northampton 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Unlocking Northampton can use these opportunities to build new business models that can help the communities that Unlocking Northampton operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Unlocking Northampton 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, Northampton Group Inc.: How to Increase Shareholder Value, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Unlocking Northampton can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
Buying journey improvements
– Unlocking Northampton can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Northampton Group Inc.: How to Increase Shareholder Value 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.
Building a culture of innovation
– managers at Unlocking Northampton 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 Finance & Accounting segment.
Learning at scale
– Online learning technologies has now opened space for Unlocking Northampton 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Unlocking Northampton in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
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 Unlocking Northampton 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Unlocking Northampton 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 Unlocking Northampton to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Unlocking Northampton 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.
Better consumer reach
– The expansion of the 5G network will help Unlocking Northampton to increase its market reach. Unlocking Northampton 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 Northampton Group Inc.: How to Increase Shareholder Value External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Northampton Group Inc.: How to Increase Shareholder Value are -
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. Unlocking Northampton needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Unlocking Northampton is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Unlocking Northampton in the Finance & Accounting industry. The Finance & Accounting 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.
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 Unlocking Northampton in the Finance & Accounting sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Unlocking Northampton 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.
Consumer confidence and its impact on Unlocking Northampton 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.
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 Unlocking Northampton.
Environmental challenges
– Unlocking Northampton 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. Unlocking Northampton can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Unlocking Northampton business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Unlocking Northampton
– 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 Unlocking Northampton.
Stagnating economy with rate increase
– Unlocking Northampton 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.
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.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Unlocking Northampton 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 Northampton Group Inc.: How to Increase Shareholder Value 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 Northampton Group Inc.: How to Increase Shareholder Value 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 Northampton Group Inc.: How to Increase Shareholder Value 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 Northampton Group Inc.: How to Increase Shareholder Value 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 Northampton Group Inc.: How to Increase Shareholder Value 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 Unlocking Northampton needs to make to build a sustainable competitive advantage.