Swot Analysis of "Silic (B): Choosing Cost or Fair Value on Adoption of IFRS" written by David F. Hawkins, Vincent Dessain, Andrew Barron includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Silic Ifrs facing as an external strategic factors. Some of the topics covered in Silic (B): Choosing Cost or Fair Value on Adoption of IFRS case study are - Strategic Management Strategies, Financial management, International business and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Silic (B): Choosing Cost or Fair Value on Adoption of IFRS casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, increasing commodity prices, increasing energy prices, wage bills are increasing, supply chains are disrupted by pandemic ,
increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Silic (B): Choosing Cost or Fair Value on Adoption of IFRS
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Silic (B): Choosing Cost or Fair Value on Adoption of IFRS case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Silic Ifrs, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Silic Ifrs 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS can be done for the following purposes –
1. Strategic planning using facts provided in Silic (B): Choosing Cost or Fair Value on Adoption of IFRS case study
2. Improving business portfolio management of Silic Ifrs
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 Silic Ifrs
Strengths Silic (B): Choosing Cost or Fair Value on Adoption of IFRS | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Silic Ifrs in Silic (B): Choosing Cost or Fair Value on Adoption of IFRS Harvard Business Review case study are -
Ability to lead change in Finance & Accounting field
– Silic Ifrs 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 Silic Ifrs in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Silic Ifrs is one of the leading recruiters in the industry. Managers in the Silic (B): Choosing Cost or Fair Value on Adoption of IFRS are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Silic Ifrs 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Silic Ifrs 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 brand equity
– Silic Ifrs has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Silic Ifrs to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Finance & Accounting industry
– Silic (B): Choosing Cost or Fair Value on Adoption of IFRS firm has clearly differentiated products in the market place. This has enabled Silic Ifrs to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Silic Ifrs to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Silic Ifrs 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Silic Ifrs has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Silic Ifrs 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.
Operational resilience
– The operational resilience strategy in the Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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.
Low bargaining power of suppliers
– Suppliers of Silic Ifrs in the sector have low bargaining power. Silic (B): Choosing Cost or Fair Value on Adoption of IFRS has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Silic Ifrs to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Silic Ifrs 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.
Learning organization
- Silic Ifrs 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 Silic Ifrs is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Silic (B): Choosing Cost or Fair Value on Adoption of IFRS Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Silic (B): Choosing Cost or Fair Value on Adoption of IFRS | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Silic (B): Choosing Cost or Fair Value on Adoption of IFRS are -
Slow to strategic competitive environment developments
– As Silic (B): Choosing Cost or Fair Value on Adoption of IFRS HBR case study mentions - Silic Ifrs 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
Silic Ifrs 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 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 Silic Ifrs supply chain. Even after few cautionary changes mentioned in the HBR case study - Silic (B): Choosing Cost or Fair Value on Adoption of IFRS, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Silic Ifrs 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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 Silic Ifrs has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Silic Ifrs 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Silic Ifrs is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Silic (B): Choosing Cost or Fair Value on Adoption of IFRS can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Silic Ifrs 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.
No frontier risks strategy
– After analyzing the HBR case study Silic (B): Choosing Cost or Fair Value on Adoption of IFRS, 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Silic (B): Choosing Cost or Fair Value on Adoption of IFRS, in the dynamic environment Silic Ifrs has struggled to respond to the nimble upstart competition. Silic Ifrs has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS can leverage the sales team experience to cultivate customer relationships as Silic Ifrs is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Silic Ifrs 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. Silic Ifrs 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.
Opportunities Silic (B): Choosing Cost or Fair Value on Adoption of IFRS | 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS are -
Creating value in data economy
– The success of analytics program of Silic Ifrs has opened avenues for new revenue streams for the organization in the industry. This can help Silic Ifrs to build a more holistic ecosystem as suggested in the Silic (B): Choosing Cost or Fair Value on Adoption of IFRS case study. Silic Ifrs can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Silic Ifrs can use these opportunities to build new business models that can help the communities that Silic Ifrs operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Loyalty marketing
– Silic Ifrs 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, Silic Ifrs is facing challenges because of the dominance of functional experts in the organization. Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Silic Ifrs can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Silic Ifrs can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Silic Ifrs can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Silic Ifrs in the consumer business. Now Silic Ifrs can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Silic Ifrs 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.
Using analytics as competitive advantage
– Silic Ifrs 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Silic Ifrs to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Silic Ifrs 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.
Buying journey improvements
– Silic Ifrs can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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.
Leveraging digital technologies
– Silic Ifrs can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Threats Silic (B): Choosing Cost or Fair Value on Adoption of IFRS External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Silic (B): Choosing Cost or Fair Value on Adoption of IFRS are -
Stagnating economy with rate increase
– Silic Ifrs can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Silic Ifrs in the Finance & Accounting sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Silic (B): Choosing Cost or Fair Value on Adoption of IFRS, Silic Ifrs 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 .
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. Silic Ifrs 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.
Consumer confidence and its impact on Silic Ifrs 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.
Regulatory challenges
– Silic Ifrs 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.
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. Silic Ifrs 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 Silic Ifrs
– 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 Silic Ifrs.
Shortening product life cycle
– it is one of the major threat that Silic Ifrs is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Silic Ifrs 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS .
Technology acceleration in Forth Industrial Revolution
– Silic Ifrs has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Silic Ifrs 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. Silic Ifrs needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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 Silic (B): Choosing Cost or Fair Value on Adoption of IFRS 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 Silic Ifrs needs to make to build a sustainable competitive advantage.