Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc.
This case examines the career path of Merck's CFO, Judy C. Lewent, as a way of tracing changes over time in Merck's finance function. It describes the adoption of innovative quantitative analytical models, changes in job definitions and in the organization of the financial area, and the evolution of professional relationships between finance and other professionals at Merck. These issues are all examined in the context of changes in the drug business.
Swot Analysis of "Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc." written by Timothy A. Luehrman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Lewent Judy facing as an external strategic factors. Some of the topics covered in Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. case study are - Strategic Management Strategies, Financial analysis, Financial management, Innovation, Organizational structure and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. casestudy better are - – there is backlash against globalization, increasing commodity prices, technology disruption, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies,
increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lewent Judy, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lewent Judy 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. can be done for the following purposes –
1. Strategic planning using facts provided in Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. case study
2. Improving business portfolio management of Lewent Judy
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 Lewent Judy
Strengths Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lewent Judy in Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. Harvard Business Review case study are -
Ability to lead change in Finance & Accounting field
– Lewent Judy 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 Lewent Judy in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Lewent Judy 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 Timothy A. Luehrman 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.
High switching costs
– The high switching costs that Lewent Judy 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 Lewent Judy in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High brand equity
– Lewent Judy has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Lewent Judy to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Lewent Judy has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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.
Cross disciplinary teams
– Horizontal connected teams at the Lewent Judy are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Sustainable margins compare to other players in Finance & Accounting industry
– Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. firm has clearly differentiated products in the market place. This has enabled Lewent Judy to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Lewent Judy to invest into research and development (R&D) and innovation.
Strong track record of project management
– Lewent Judy 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
– Lewent Judy is one of the leading recruiters in the industry. Managers in the Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Lewent Judy digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Lewent Judy 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.
Successful track record of launching new products
– Lewent Judy has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Lewent Judy 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.
Weaknesses Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc., is just above the industry average. Lewent Judy 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.
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 Lewent Judy supply chain. Even after few cautionary changes mentioned in the HBR case study - Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc., it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Lewent Judy vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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 Lewent Judy has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. can leverage the sales team experience to cultivate customer relationships as Lewent Judy is planning to shift buying processes online.
Lack of clear differentiation of Lewent Judy products
– To increase the profitability and margins on the products, Lewent Judy needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Lewent Judy is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Lewent Judy needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Lewent Judy to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Lewent Judy 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.
Low market penetration in new markets
– Outside its home market of Lewent Judy, firm in the HBR case study Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. HBR case study mentions - Lewent Judy 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 bargaining power of channel partners
– Because of the regulatory requirements, Timothy A. Luehrman suggests that, Lewent Judy 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Lewent Judy 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.
Opportunities Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. | 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. are -
Learning at scale
– Online learning technologies has now opened space for Lewent Judy 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Lewent Judy 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, Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc., to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Lewent Judy has opened avenues for new revenue streams for the organization in the industry. This can help Lewent Judy to build a more holistic ecosystem as suggested in the Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. case study. Lewent Judy can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Lewent Judy 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Lewent Judy to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Lewent Judy 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.
Manufacturing automation
– Lewent Judy 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Lewent Judy 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 Lewent Judy to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Lewent Judy 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.
Buying journey improvements
– Lewent Judy can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Lewent Judy is facing challenges because of the dominance of functional experts in the organization. Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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.
Better consumer reach
– The expansion of the 5G network will help Lewent Judy to increase its market reach. Lewent Judy 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.
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. Lewent Judy 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. Lewent Judy 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.
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 Lewent Judy 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.
Threats Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc., Lewent Judy may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Stagnating economy with rate increase
– Lewent Judy 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.
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.
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. Lewent Judy can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Lewent Judy
– 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 Lewent Judy.
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. Lewent Judy 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Lewent Judy with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Lewent Judy is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Lewent Judy 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Lewent Judy 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. .
Technology acceleration in Forth Industrial Revolution
– Lewent Judy has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Lewent Judy needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Lewent Judy needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Lewent Judy 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.
Weighted SWOT Analysis of Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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 Evolving Finance Function: Judy C. Lewent at Merck & Co., Inc. 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 Lewent Judy needs to make to build a sustainable competitive advantage.
