The Crisis at Tyco-A Director's Perspective SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of The Crisis at Tyco-A Director's Perspective

In 2002, Wendy Lane had been a member of the board of directors at Tyco International a little more than a year when the company's CEO, Dennis Kozlowski, and other top executives were accused of fraud, which ultimately led to resignations, imprisonments, lawsuits, and SEC filings. In a short period of time Tyco lost two-thirds of its market value. Many outside the company questioned the board's leadership and diligence. Lane, who had a successful career in investment banking before becoming a professional director, was caught in the firestorm. The case discusses the events that led to the crisis, her reflections on managing the crisis both personally and professionally, the reputational risk she encountered, and the lessons she learned as a director.

Authors :: Suraj Srinivasan, Aldo Sesia

Topics :: Finance & Accounting

Tags :: Boards, Business law, Collaboration, Crisis management, Financial management, Leadership, Leading teams, Marketing, Public relations, Risk management, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "The Crisis at Tyco-A Director's Perspective" written by Suraj Srinivasan, Aldo Sesia includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Tyco Lane facing as an external strategic factors. Some of the topics covered in The Crisis at Tyco-A Director's Perspective case study are - Strategic Management Strategies, Boards, Business law, Collaboration, Crisis management, Financial management, Leadership, Leading teams, Marketing, Public relations, Risk management and Finance & Accounting.

Some of the macro environment factors that can be used to understand the The Crisis at Tyco-A Director's Perspective casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, increasing commodity prices, there is increasing trade war between United States & China, etc

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Introduction to SWOT Analysis of The Crisis at Tyco-A Director's Perspective

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Crisis at Tyco-A Director's Perspective case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tyco Lane, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tyco Lane 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of The Crisis at Tyco-A Director's Perspective can be done for the following purposes –
1. Strategic planning using facts provided in The Crisis at Tyco-A Director's Perspective case study
2. Improving business portfolio management of Tyco Lane
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 Tyco Lane

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Strengths The Crisis at Tyco-A Director's Perspective | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Tyco Lane in The Crisis at Tyco-A Director's Perspective Harvard Business Review case study are -

Cross disciplinary teams

– Horizontal connected teams at the Tyco Lane 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.

Superior customer experience

– The customer experience strategy of Tyco Lane in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Highly skilled collaborators

– Tyco Lane 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 The Crisis at Tyco-A Director's Perspective HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Training and development

– Tyco Lane has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Crisis at Tyco-A Director's Perspective 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.

High brand equity

– Tyco Lane has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tyco Lane to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Strong track record of project management

– Tyco Lane is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Analytics focus

– Tyco Lane 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 Suraj Srinivasan, Aldo Sesia 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

- Tyco Lane 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 Tyco Lane is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Crisis at Tyco-A Director's Perspective Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Digital Transformation in Finance & Accounting segment

- digital transformation varies from industry to industry. For Tyco Lane digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tyco Lane 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.

Innovation driven organization

– Tyco Lane is one of the most innovative firm in sector. Manager in The Crisis at Tyco-A Director's Perspective Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

Ability to recruit top talent

– Tyco Lane is one of the leading recruiters in the industry. Managers in the The Crisis at Tyco-A Director's Perspective are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

Low bargaining power of suppliers

– Suppliers of Tyco Lane in the sector have low bargaining power. The Crisis at Tyco-A Director's Perspective has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Tyco Lane to manage not only supply disruptions but also source products at highly competitive prices.

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Weaknesses The Crisis at Tyco-A Director's Perspective | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of The Crisis at Tyco-A Director's Perspective are -

Lack of clear differentiation of Tyco Lane products

– To increase the profitability and margins on the products, Tyco Lane needs to provide more differentiated products than what it is currently offering in the marketplace.

Need for greater diversity

– Tyco Lane 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tyco Lane is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Crisis at Tyco-A Director's Perspective can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

Interest costs

– Compare to the competition, Tyco Lane 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.

Capital Spending Reduction

– Even during the low interest decade, Tyco Lane 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.

Low market penetration in new markets

– Outside its home market of Tyco Lane, firm in the HBR case study The Crisis at Tyco-A Director's Perspective needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

No frontier risks strategy

– After analyzing the HBR case study The Crisis at Tyco-A Director's Perspective, 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.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study The Crisis at Tyco-A Director's Perspective, it seems that the employees of Tyco Lane don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.

High dependence on star products

– The top 2 products and services of the firm as mentioned in the The Crisis at Tyco-A Director's Perspective 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 Tyco Lane has relatively successful track record of launching new products.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study The Crisis at Tyco-A Director's Perspective, in the dynamic environment Tyco Lane has struggled to respond to the nimble upstart competition. Tyco Lane has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

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 Tyco Lane supply chain. Even after few cautionary changes mentioned in the HBR case study - The Crisis at Tyco-A Director's Perspective, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tyco Lane vulnerable to further global disruptions in South East Asia.

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Opportunities The Crisis at Tyco-A Director's Perspective | 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 The Crisis at Tyco-A Director's Perspective are -

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Tyco Lane can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Manufacturing automation

– Tyco Lane 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.

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 Tyco Lane 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.

Leveraging digital technologies

– Tyco Lane 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.

Learning at scale

– Online learning technologies has now opened space for Tyco Lane 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.

Loyalty marketing

– Tyco Lane 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Tyco Lane 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, The Crisis at Tyco-A Director's Perspective, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Low interest rates

– Even though inflation is raising its head in most developed economies, Tyco Lane 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.

Buying journey improvements

– Tyco Lane can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Crisis at Tyco-A Director's Perspective 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.

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 Tyco Lane in the consumer business. Now Tyco Lane can target international markets with far fewer capital restrictions requirements than the existing system.

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. Tyco Lane can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Better consumer reach

– The expansion of the 5G network will help Tyco Lane to increase its market reach. Tyco Lane 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tyco Lane can use these opportunities to build new business models that can help the communities that Tyco Lane operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.

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Threats The Crisis at Tyco-A Director's Perspective External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study The Crisis at Tyco-A Director's Perspective are -

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 Tyco Lane.

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.

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

– Tyco Lane 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.

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 Tyco Lane business can come under increasing regulations regarding data privacy, data security, etc.

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. Tyco Lane can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Consumer confidence and its impact on Tyco Lane 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.

Technology acceleration in Forth Industrial Revolution

– Tyco Lane has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Tyco Lane 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.

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 Tyco Lane in the Finance & Accounting sector and impact the bottomline of the organization.

High dependence on third party suppliers

– Tyco Lane 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.

Regulatory challenges

– Tyco Lane 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 Finance & Accounting industry regulations.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Tyco Lane with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Tyco Lane 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 The Crisis at Tyco-A Director's Perspective .

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Weighted SWOT Analysis of The Crisis at Tyco-A Director's Perspective 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 The Crisis at Tyco-A Director's Perspective 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 The Crisis at Tyco-A Director's Perspective 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 The Crisis at Tyco-A Director's Perspective 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 The Crisis at Tyco-A Director's Perspective 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 Tyco Lane needs to make to build a sustainable competitive advantage.

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