Compte-Nickel: Creating New Demand in the Retail Banking Sector SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Compte-Nickel: Creating New Demand in the Retail Banking Sector
The case explains how Compte-Nickel found a blue ocean in the crowded French retail banking sector by identifying noncustomers and developing a strategy to attract them. Traditional banks focused on developing financial technology to make their offerings more appealing, whereas Compte-Nickel created a blue ocean by looking at the noncustomers the other banks ignored: low income earners and people facing financial exclusion.
Authors :: W. Chan Kim, Renee Mauborgne, Melanie Pipino
Swot Analysis of "Compte-Nickel: Creating New Demand in the Retail Banking Sector" written by W. Chan Kim, Renee Mauborgne, Melanie Pipino includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Compte Nickel facing as an external strategic factors. Some of the topics covered in Compte-Nickel: Creating New Demand in the Retail Banking Sector case study are - Strategic Management Strategies, Entrepreneurship, Financial management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Compte-Nickel: Creating New Demand in the Retail Banking Sector casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions, increasing government debt because of Covid-19 spendings, technology disruption, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, increasing transportation and logistics costs,
there is backlash against globalization, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Compte-Nickel: Creating New Demand in the Retail Banking Sector
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Compte-Nickel: Creating New Demand in the Retail Banking Sector case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Compte Nickel, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Compte Nickel 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector can be done for the following purposes –
1. Strategic planning using facts provided in Compte-Nickel: Creating New Demand in the Retail Banking Sector case study
2. Improving business portfolio management of Compte Nickel
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 Compte Nickel
Strengths Compte-Nickel: Creating New Demand in the Retail Banking Sector | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Compte Nickel in Compte-Nickel: Creating New Demand in the Retail Banking Sector Harvard Business Review case study are -
High switching costs
– The high switching costs that Compte Nickel has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Superior customer experience
– The customer experience strategy of Compte Nickel in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Compte Nickel 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 Compte Nickel is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Compte-Nickel: Creating New Demand in the Retail Banking Sector Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Compte Nickel is present in almost all the verticals within the industry. This has provided firm in Compte-Nickel: Creating New Demand in the Retail Banking Sector case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High brand equity
– Compte Nickel has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Compte Nickel to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Strategy & Execution field
– Compte Nickel 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 Compte Nickel in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Compte-Nickel: Creating New Demand in the Retail Banking Sector 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.
Analytics focus
– Compte Nickel 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 W. Chan Kim, Renee Mauborgne, Melanie Pipino 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.
Organizational Resilience of Compte Nickel
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Compte Nickel does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Compte Nickel is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Compte Nickel 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Compte Nickel has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Compte Nickel has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Weaknesses Compte-Nickel: Creating New Demand in the Retail Banking Sector | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Compte-Nickel: Creating New Demand in the Retail Banking Sector are -
Products dominated business model
– Even though Compte Nickel 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 - Compte-Nickel: Creating New Demand in the Retail Banking Sector should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study Compte-Nickel: Creating New Demand in the Retail Banking Sector has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Compte Nickel 's lucrative customers.
Interest costs
– Compare to the competition, Compte Nickel 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Compte-Nickel: Creating New Demand in the Retail Banking Sector, is just above the industry average. Compte Nickel 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Compte-Nickel: Creating New Demand in the Retail Banking Sector, it seems that the employees of Compte Nickel 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 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 Compte Nickel supply chain. Even after few cautionary changes mentioned in the HBR case study - Compte-Nickel: Creating New Demand in the Retail Banking Sector, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Compte Nickel vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Compte Nickel is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Compte Nickel needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Compte Nickel to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Compte-Nickel: Creating New Demand in the Retail Banking Sector HBR case study mentions - Compte Nickel 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.
Skills based hiring
– The stress on hiring functional specialists at Compte Nickel 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.
Aligning sales with marketing
– It come across in the case study Compte-Nickel: Creating New Demand in the Retail Banking Sector 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector can leverage the sales team experience to cultivate customer relationships as Compte Nickel is planning to shift buying processes online.
Lack of clear differentiation of Compte Nickel products
– To increase the profitability and margins on the products, Compte Nickel needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Compte-Nickel: Creating New Demand in the Retail Banking Sector | 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector are -
Creating value in data economy
– The success of analytics program of Compte Nickel has opened avenues for new revenue streams for the organization in the industry. This can help Compte Nickel to build a more holistic ecosystem as suggested in the Compte-Nickel: Creating New Demand in the Retail Banking Sector case study. Compte Nickel can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Compte Nickel 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.
Using analytics as competitive advantage
– Compte Nickel 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Compte Nickel to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Compte Nickel 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, Compte-Nickel: Creating New Demand in the Retail Banking Sector, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Compte Nickel is facing challenges because of the dominance of functional experts in the organization. Compte-Nickel: Creating New Demand in the Retail Banking Sector 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 Compte Nickel 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.
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 Compte Nickel in the consumer business. Now Compte Nickel can target international markets with far fewer capital restrictions requirements than the existing system.
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. Compte Nickel can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Compte Nickel 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.
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. Compte Nickel can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Compte Nickel 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Compte Nickel 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 Compte Nickel to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Compte Nickel 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.
Threats Compte-Nickel: Creating New Demand in the Retail Banking Sector External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Compte-Nickel: Creating New Demand in the Retail Banking Sector are -
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 Compte Nickel 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 Compte Nickel business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Compte Nickel 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector .
High dependence on third party suppliers
– Compte Nickel 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.
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. Compte Nickel needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Regulatory challenges
– Compte Nickel 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Compte Nickel 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector, Compte Nickel 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 .
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 wage structure of Compte Nickel
– 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 Compte Nickel.
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 Compte Nickel.
Consumer confidence and its impact on Compte Nickel 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.
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.
Weighted SWOT Analysis of Compte-Nickel: Creating New Demand in the Retail Banking Sector 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector 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 Compte-Nickel: Creating New Demand in the Retail Banking Sector 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 Compte Nickel needs to make to build a sustainable competitive advantage.