Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002
This case describes the rights offering by CSM in 2002 which was largely judged to be a failure despite the company receiving the full planned proceeds. The case takes the reader through the rights offering process, and details the "hiccups" arising from adverse market conditions as well as process mismanagement. It also allows the reader to use actual data provided by several top broker research analysts to conduct a valuation exercise. Other questions addressed include: Does price matter in a rights offering? Are investors rational? How does one gauge the value of a project?
Swot Analysis of "Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002" written by Pierre Hillion, Aaron Yeo includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Rights Offering facing as an external strategic factors. Some of the topics covered in Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 case study are - Strategic Management Strategies, Corporate governance, Financial analysis, Financial management, Technology and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, challanges to central banks by blockchain based private currencies, increasing energy prices, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%,
geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Rights Offering, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Rights Offering 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 Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 can be done for the following purposes –
1. Strategic planning using facts provided in Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 case study
2. Improving business portfolio management of Rights Offering
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 Rights Offering
Strengths Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Rights Offering in Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 Harvard Business Review case study are -
High brand equity
– Rights Offering has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Rights Offering to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Rights Offering digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Rights Offering 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 Rights Offering in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Rights Offering is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Rights Offering is one of the leading recruiters in the industry. Managers in the Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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)
– Rights Offering 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 Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Rights Offering 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 Rights Offering is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Rights Offering 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 Pierre Hillion, Aaron Yeo 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.
High switching costs
– The high switching costs that Rights Offering 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.
Organizational Resilience of Rights Offering
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Rights Offering does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Rights Offering has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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.
Ability to lead change in Finance & Accounting field
– Rights Offering 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 Rights Offering in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 are -
High cash cycle compare to competitors
Rights Offering 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.
Products dominated business model
– Even though Rights Offering 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 - Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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 Rights Offering has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Rights Offering 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. Rights Offering 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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 Rights Offering 's lucrative customers.
Lack of clear differentiation of Rights Offering products
– To increase the profitability and margins on the products, Rights Offering needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002, in the dynamic environment Rights Offering has struggled to respond to the nimble upstart competition. Rights Offering has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Rights Offering 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Pierre Hillion, Aaron Yeo suggests that, Rights Offering is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
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 Rights Offering supply chain. Even after few cautionary changes mentioned in the HBR case study - Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Rights Offering vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Rights Offering 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.
Opportunities Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 | 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 Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Rights Offering 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Rights Offering 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, Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Rights Offering 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.
Learning at scale
– Online learning technologies has now opened space for Rights Offering to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Developing new processes and practices
– Rights Offering can develop new processes and procedures in Finance & Accounting 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.
Manufacturing automation
– Rights Offering can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Creating value in data economy
– The success of analytics program of Rights Offering has opened avenues for new revenue streams for the organization in the industry. This can help Rights Offering to build a more holistic ecosystem as suggested in the Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 case study. Rights Offering can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Rights Offering is facing challenges because of the dominance of functional experts in the organization. Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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.
Loyalty marketing
– Rights Offering 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Rights Offering can use these opportunities to build new business models that can help the communities that Rights Offering operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Better consumer reach
– The expansion of the 5G network will help Rights Offering to increase its market reach. Rights Offering 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.
Leveraging digital technologies
– Rights Offering 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Rights Offering can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 are -
Stagnating economy with rate increase
– Rights Offering 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.
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. Rights Offering 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.
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. Rights Offering needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Rights Offering 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 Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 .
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 Rights Offering.
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. Rights Offering can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Rights Offering is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Rights Offering business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Rights Offering 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Rights Offering with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
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 Rights Offering in the Finance & Accounting sector and impact the bottomline of the organization.
Environmental challenges
– Rights Offering 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. Rights Offering can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Weighted SWOT Analysis of Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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 Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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 Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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 Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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 Chartered Semiconductor Manufacturing Limited: When Rights go Wrong: The Rights Offering of September 2002 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 Rights Offering needs to make to build a sustainable competitive advantage.
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