Case Study Description of Oracle's Hostile Takeover of PeopleSoft (A)
In June of 2003, PeopleSoft management announced a merger with J.D. Edwards. Within hours of the announcement, Oracle had launched a hostile takeover attempt of PeopleSoft. Oracle's bid raised enormously difficult questions for the PeopleSoft board, questions about whether PeopleSoft products would continue to be supported and customers became reluctant to buy PeopleSoft software. Managers were therefore faced with a decision about how to respond to the bid and the uncertainty it created. To regain customer and analyst confidence, PeopleSoft's board considered adopting a Customer Assurance Program in which customers would receive a cash payment in the event of a takeover. This promise of a cash payment would not only encourage customers to invest in PeopleSoft products, but also created a liability that might be large enough to derail Oracle's takeover attempt altogether. The board therefore had to consider the implications of a Customer Assurance Program for the welfare of the firm, its customers, and its duties to shareholders faced with a tender offer.
Authors :: Robert M. Daines, Vinay B. Nair, Davina Drabkin
Swot Analysis of "Oracle's Hostile Takeover of PeopleSoft (A)" written by Robert M. Daines, Vinay B. Nair, Davina Drabkin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Peoplesoft Oracle's facing as an external strategic factors. Some of the topics covered in Oracle's Hostile Takeover of PeopleSoft (A) case study are - Strategic Management Strategies, Mergers & acquisitions, Performance measurement and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Oracle's Hostile Takeover of PeopleSoft (A) casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, increasing transportation and logistics costs,
wage bills are increasing, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Oracle's Hostile Takeover of PeopleSoft (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Oracle's Hostile Takeover of PeopleSoft (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Peoplesoft Oracle's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Peoplesoft Oracle's 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 Oracle's Hostile Takeover of PeopleSoft (A) can be done for the following purposes –
1. Strategic planning using facts provided in Oracle's Hostile Takeover of PeopleSoft (A) case study
2. Improving business portfolio management of Peoplesoft Oracle's
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Peoplesoft Oracle's
Strengths Oracle's Hostile Takeover of PeopleSoft (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Peoplesoft Oracle's in Oracle's Hostile Takeover of PeopleSoft (A) Harvard Business Review case study are -
High brand equity
– Peoplesoft Oracle's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Peoplesoft Oracle's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Peoplesoft Oracle's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Peoplesoft Oracle's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Peoplesoft Oracle's 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.
Ability to lead change in Strategy & Execution field
– Peoplesoft Oracle's 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 Peoplesoft Oracle's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Peoplesoft Oracle's 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.
Innovation driven organization
– Peoplesoft Oracle's is one of the most innovative firm in sector. Manager in Oracle's Hostile Takeover of PeopleSoft (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Peoplesoft Oracle's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Peoplesoft Oracle's 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.
Superior customer experience
– The customer experience strategy of Peoplesoft Oracle's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Peoplesoft Oracle's 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 Robert M. Daines, Vinay B. Nair, Davina Drabkin 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.
Operational resilience
– The operational resilience strategy in the Oracle's Hostile Takeover of PeopleSoft (A) 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 Peoplesoft Oracle's in the sector have low bargaining power. Oracle's Hostile Takeover of PeopleSoft (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Peoplesoft Oracle's to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Peoplesoft Oracle's 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 Oracle's Hostile Takeover of PeopleSoft (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses Oracle's Hostile Takeover of PeopleSoft (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Oracle's Hostile Takeover of PeopleSoft (A) are -
Need for greater diversity
– Peoplesoft Oracle's 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 strategic competitive environment developments
– As Oracle's Hostile Takeover of PeopleSoft (A) HBR case study mentions - Peoplesoft Oracle's 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.
Capital Spending Reduction
– Even during the low interest decade, Peoplesoft Oracle's 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Oracle's Hostile Takeover of PeopleSoft (A), it seems that the employees of Peoplesoft Oracle's 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.
No frontier risks strategy
– After analyzing the HBR case study Oracle's Hostile Takeover of PeopleSoft (A), it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Oracle's Hostile Takeover of PeopleSoft (A) 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 Peoplesoft Oracle's has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Oracle's Hostile Takeover of PeopleSoft (A), is just above the industry average. Peoplesoft Oracle's 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Peoplesoft Oracle's 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.
Lack of clear differentiation of Peoplesoft Oracle's products
– To increase the profitability and margins on the products, Peoplesoft Oracle's needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Peoplesoft Oracle's has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Oracle's Hostile Takeover of PeopleSoft (A) should strive to include more intangible value offerings along with its core products and services.
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 Peoplesoft Oracle's supply chain. Even after few cautionary changes mentioned in the HBR case study - Oracle's Hostile Takeover of PeopleSoft (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Peoplesoft Oracle's vulnerable to further global disruptions in South East Asia.
Opportunities Oracle's Hostile Takeover of PeopleSoft (A) | 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 Oracle's Hostile Takeover of PeopleSoft (A) are -
Loyalty marketing
– Peoplesoft Oracle's 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.
Better consumer reach
– The expansion of the 5G network will help Peoplesoft Oracle's to increase its market reach. Peoplesoft Oracle's 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Peoplesoft Oracle's 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, Oracle's Hostile Takeover of PeopleSoft (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Peoplesoft Oracle's 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 Peoplesoft Oracle's to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Peoplesoft Oracle's can use these opportunities to build new business models that can help the communities that Peoplesoft Oracle's operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Leveraging digital technologies
– Peoplesoft Oracle's 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.
Manufacturing automation
– Peoplesoft Oracle's can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
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 Peoplesoft Oracle's in the consumer business. Now Peoplesoft Oracle's can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Peoplesoft Oracle's can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Peoplesoft Oracle's 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. Peoplesoft Oracle's can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Low interest rates
– Even though inflation is raising its head in most developed economies, Peoplesoft Oracle's 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Peoplesoft Oracle's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Peoplesoft Oracle's is facing challenges because of the dominance of functional experts in the organization. Oracle's Hostile Takeover of PeopleSoft (A) 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.
Threats Oracle's Hostile Takeover of PeopleSoft (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Oracle's Hostile Takeover of PeopleSoft (A) are -
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.
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. Peoplesoft Oracle's 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.
Shortening product life cycle
– it is one of the major threat that Peoplesoft Oracle's is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Peoplesoft Oracle's high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Peoplesoft Oracle's 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 Oracle's Hostile Takeover of PeopleSoft (A) .
Environmental challenges
– Peoplesoft Oracle's 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. Peoplesoft Oracle's can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Regulatory challenges
– Peoplesoft Oracle's 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 Strategy & Execution industry regulations.
Increasing wage structure of Peoplesoft Oracle's
– 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 Peoplesoft Oracle's.
Consumer confidence and its impact on Peoplesoft Oracle's 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 Peoplesoft Oracle's.
Stagnating economy with rate increase
– Peoplesoft Oracle's 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.
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. Peoplesoft Oracle's needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Peoplesoft Oracle's has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Peoplesoft Oracle's needs to keep up with the evolution of technology in the Strategy & Execution 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.
Weighted SWOT Analysis of Oracle's Hostile Takeover of PeopleSoft (A) 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 Oracle's Hostile Takeover of PeopleSoft (A) 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 Oracle's Hostile Takeover of PeopleSoft (A) 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 Oracle's Hostile Takeover of PeopleSoft (A) 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 Oracle's Hostile Takeover of PeopleSoft (A) 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 Peoplesoft Oracle's needs to make to build a sustainable competitive advantage.
