What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings
After decades of continuity, Luse Holdings faced a new challenge in 2015. The company needed to pivot in a changing industry context-specifically, Luse had lost a bid to a non-union competitor for the first time-and CEO and fourth-generation member Steve Luse was considering three primary options: (1) continue as is, while also adding non-union services; (2) sell part of the business to reduce family risk; or (3) sell the entire business to fund other family interests. A fourth possible option was a maximization-of-growth alternative. This decision involved more than business considerations alone. The family's legacy as an industry champion and community philanthropist also required considering all relevant stakeholders, including immediate and extended family, employees, and community. Complicating the situation was the lack of an immediately identifiable successor in the next generation of the Luse family, though several fifth-generation members had completed internships with the business-including Steve's daughter Ashley, a recent MBA graduate. Students will step into Steve's shoes as he considers what recommendations to make to the advisory board six months from now. Students can also take the perspective of Ashley, a rising next-generation member: should she join the family business?
Swot Analysis of "What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings" written by John L. Ward, Ashley E. Luse includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Luse Family facing as an external strategic factors. Some of the topics covered in What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings case study are - Strategic Management Strategies, Leadership, Succession planning and Strategy & Execution.
Some of the macro environment factors that can be used to understand the What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings casestudy better are - – technology disruption, cloud computing is disrupting traditional business models, geopolitical disruptions, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings,
banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Luse Family, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Luse Family 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings can be done for the following purposes –
1. Strategic planning using facts provided in What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings case study
2. Improving business portfolio management of Luse Family
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 Luse Family
Strengths What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Luse Family in What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings Harvard Business Review case study are -
High brand equity
– Luse Family has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Luse Family to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Luse Family in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Luse Family 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.
Training and development
– Luse Family has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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.
Operational resilience
– The operational resilience strategy in the What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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.
Ability to lead change in Strategy & Execution field
– Luse Family 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 Luse Family in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Luse Family digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Luse Family 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
– Luse Family has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Luse Family 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.
Highly skilled collaborators
– Luse Family 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Luse Family
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Luse Family does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Strategy & Execution industry
– What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings firm has clearly differentiated products in the market place. This has enabled Luse Family to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Luse Family to invest into research and development (R&D) and innovation.
Strong track record of project management
– Luse Family is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings are -
High cash cycle compare to competitors
Luse Family 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.
Lack of clear differentiation of Luse Family products
– To increase the profitability and margins on the products, Luse Family needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Luse Family is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings, it seems that the employees of Luse Family 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings, is just above the industry average. Luse Family 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 star products
– The top 2 products and services of the firm as mentioned in the What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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 Luse Family has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings can leverage the sales team experience to cultivate customer relationships as Luse Family is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings, 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.
Need for greater diversity
– Luse Family 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.
Products dominated business model
– Even though Luse Family 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 - What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings HBR case study mentions - Luse Family 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.
Opportunities What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings | 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings are -
Creating value in data economy
– The success of analytics program of Luse Family has opened avenues for new revenue streams for the organization in the industry. This can help Luse Family to build a more holistic ecosystem as suggested in the What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings case study. Luse Family can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Luse Family 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 Strategy & Execution segment.
Loyalty marketing
– Luse Family 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, Luse Family is facing challenges because of the dominance of functional experts in the organization. What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Luse Family in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Luse Family 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 Luse Family to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Luse Family 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Luse Family 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
– Luse Family can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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
– Luse Family 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Luse Family can use these opportunities to build new business models that can help the communities that Luse Family operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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 Luse Family 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Luse Family can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings are -
Regulatory challenges
– Luse Family 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.
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 Luse Family.
Technology acceleration in Forth Industrial Revolution
– Luse Family has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Luse Family 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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Luse Family 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings .
High dependence on third party suppliers
– Luse Family 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Luse Family in the Strategy & Execution industry. The Strategy & Execution 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Luse Family with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings, Luse Family may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
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 Luse Family in the Strategy & Execution sector and impact the bottomline of the organization.
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 Luse Family business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Luse Family 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.
Stagnating economy with rate increase
– Luse Family 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.
Weighted SWOT Analysis of What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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 What's in a Family Legacy? Balancing Family Emotions and Business Growth at Luse Holdings 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 Luse Family needs to make to build a sustainable competitive advantage.
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