Case Study Description of Aspen Technology, Inc.: Currency Hedging Review, Spanish Version
The chief financial officer of a rapidly growing U.S.-based software firm that sells its process-control software to industrial users around the globe must review the goals, strategies, and policies of the firm's currency hedging program. This review is prompted by changes in the firm's business, notably its acquisition of a United Kingdom subsidiary, other growing overseas expenses, and its recent initial public offering.
Swot Analysis of "Aspen Technology, Inc.: Currency Hedging Review, Spanish Version" written by Peter Tufano, Cameron Poetzscher includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hedging Review facing as an external strategic factors. Some of the topics covered in Aspen Technology, Inc.: Currency Hedging Review, Spanish Version case study are - Strategic Management Strategies, Financial management, Risk management, Technology and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Aspen Technology, Inc.: Currency Hedging Review, Spanish Version casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, technology disruption, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, challanges to central banks by blockchain based private currencies,
geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Aspen Technology, Inc.: Currency Hedging Review, Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Aspen Technology, Inc.: Currency Hedging Review, Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hedging Review, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hedging Review 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in Aspen Technology, Inc.: Currency Hedging Review, Spanish Version case study
2. Improving business portfolio management of Hedging Review
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 Hedging Review
Strengths Aspen Technology, Inc.: Currency Hedging Review, Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hedging Review in Aspen Technology, Inc.: Currency Hedging Review, Spanish Version Harvard Business Review case study are -
Learning organization
- Hedging Review 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 Hedging Review is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Aspen Technology, Inc.: Currency Hedging Review, Spanish Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Hedging Review 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Hedging Review 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.
Low bargaining power of suppliers
– Suppliers of Hedging Review in the sector have low bargaining power. Aspen Technology, Inc.: Currency Hedging Review, Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hedging Review to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Hedging Review digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hedging Review 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 Hedging Review in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Hedging Review is one of the leading recruiters in the industry. Managers in the Aspen Technology, Inc.: Currency Hedging Review, Spanish Version are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Hedging Review is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Finance & Accounting industry
– Aspen Technology, Inc.: Currency Hedging Review, Spanish Version firm has clearly differentiated products in the market place. This has enabled Hedging Review to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Hedging Review to invest into research and development (R&D) and innovation.
Organizational Resilience of Hedging Review
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hedging Review does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Finance & Accounting field
– Hedging Review 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 Hedging Review in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Hedging Review is present in almost all the verticals within the industry. This has provided firm in Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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.
Weaknesses Aspen Technology, Inc.: Currency Hedging Review, Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Aspen Technology, Inc.: Currency Hedging Review, Spanish Version are -
Aligning sales with marketing
– It come across in the case study Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version can leverage the sales team experience to cultivate customer relationships as Hedging Review is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Aspen Technology, Inc.: Currency Hedging Review, Spanish Version, in the dynamic environment Hedging Review has struggled to respond to the nimble upstart competition. Hedging Review has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Aspen Technology, Inc.: Currency Hedging Review, Spanish Version, it seems that the employees of Hedging Review 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.
Slow decision making process
– As mentioned earlier in the report, Hedging Review 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. Hedging Review 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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 Hedging Review has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Hedging Review, firm in the HBR case study Aspen Technology, Inc.: Currency Hedging Review, Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Hedging Review 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.
Need for greater diversity
– Hedging Review 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hedging Review is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Aspen Technology, Inc.: Currency Hedging Review, Spanish Version can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Hedging Review is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Hedging Review needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hedging Review to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Hedging Review 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.
Opportunities Aspen Technology, Inc.: Currency Hedging Review, Spanish Version | 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Hedging Review 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
– Hedging Review can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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.
Using analytics as competitive advantage
– Hedging Review 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hedging Review to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Hedging Review has opened avenues for new revenue streams for the organization in the industry. This can help Hedging Review to build a more holistic ecosystem as suggested in the Aspen Technology, Inc.: Currency Hedging Review, Spanish Version case study. Hedging Review 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 Hedging Review can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Developing new processes and practices
– Hedging Review 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hedging Review is facing challenges because of the dominance of functional experts in the organization. Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hedging Review can use these opportunities to build new business models that can help the communities that Hedging Review operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Manufacturing automation
– Hedging Review 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.
Leveraging digital technologies
– Hedging Review 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hedging Review 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, Aspen Technology, Inc.: Currency Hedging Review, Spanish Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hedging Review in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hedging Review 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. Hedging Review 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.
Threats Aspen Technology, Inc.: Currency Hedging Review, Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Aspen Technology, Inc.: Currency Hedging Review, Spanish Version are -
Environmental challenges
– Hedging Review 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. Hedging Review can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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. Hedging Review can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Hedging Review with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Hedging Review 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
– Hedging Review 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hedging Review in the Finance & Accounting industry. The Finance & Accounting 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.
Shortening product life cycle
– it is one of the major threat that Hedging Review is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Hedging Review in the Finance & Accounting sector and impact the bottomline of the organization.
Increasing wage structure of Hedging Review
– 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 Hedging Review.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Aspen Technology, Inc.: Currency Hedging Review, Spanish Version, Hedging Review may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
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 Hedging Review.
Technology acceleration in Forth Industrial Revolution
– Hedging Review has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Hedging Review needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Weighted SWOT Analysis of Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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 Aspen Technology, Inc.: Currency Hedging Review, Spanish Version 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 Hedging Review needs to make to build a sustainable competitive advantage.
