Strategies to Prevent Economic Recessions from Causing Business Failure SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Strategies to Prevent Economic Recessions from Causing Business Failure
An average of more than 500,000 businesses failed in the United States during each of the 10 recessions that have occurred since the end of World War II. Yet, scholarly and practitioner understanding of how to prepare for and respond to the challenges of an economic downturn remains extremely limited. This article analyzes and synthesizes the information from academic theory and business experience on managing through an economic recession. To assist firms in successfully navigating economic recessions, we suggest a program that involves positioning by holding positions in multiple markets and geographies, planning by developing a turnaround plan for facing sharply declining sales, promoting by maintaining marketing initiatives, and preparing by acting in anticipation of economic recovery.
Swot Analysis of "Strategies to Prevent Economic Recessions from Causing Business Failure" written by Steven C. Michael, John A. Pearce includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Recessions Economic facing as an external strategic factors. Some of the topics covered in Strategies to Prevent Economic Recessions from Causing Business Failure case study are - Strategic Management Strategies, Financial management, Recession, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Strategies to Prevent Economic Recessions from Causing Business Failure casestudy better are - – increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, supply chains are disrupted by pandemic , wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels,
geopolitical disruptions, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Strategies to Prevent Economic Recessions from Causing Business Failure
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Strategies to Prevent Economic Recessions from Causing Business Failure case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Recessions Economic, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Recessions Economic 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 Strategies to Prevent Economic Recessions from Causing Business Failure can be done for the following purposes –
1. Strategic planning using facts provided in Strategies to Prevent Economic Recessions from Causing Business Failure case study
2. Improving business portfolio management of Recessions Economic
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 Recessions Economic
Strengths Strategies to Prevent Economic Recessions from Causing Business Failure | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Recessions Economic in Strategies to Prevent Economic Recessions from Causing Business Failure Harvard Business Review case study are -
Innovation driven organization
– Recessions Economic is one of the most innovative firm in sector. Manager in Strategies to Prevent Economic Recessions from Causing Business Failure Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Recessions Economic has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Strategies to Prevent Economic Recessions from Causing Business Failure 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.
High brand equity
– Recessions Economic has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Recessions Economic to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Recessions Economic has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Recessions Economic 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Strategies to Prevent Economic Recessions from Causing Business Failure firm has clearly differentiated products in the market place. This has enabled Recessions Economic to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Recessions Economic to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Recessions Economic in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Recessions Economic 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 Recessions Economic is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Strategies to Prevent Economic Recessions from Causing Business Failure Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Recessions Economic are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Diverse revenue streams
– Recessions Economic is present in almost all the verticals within the industry. This has provided firm in Strategies to Prevent Economic Recessions from Causing Business Failure 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.
Low bargaining power of suppliers
– Suppliers of Recessions Economic in the sector have low bargaining power. Strategies to Prevent Economic Recessions from Causing Business Failure has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Recessions Economic to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Recessions Economic 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 Strategies to Prevent Economic Recessions from Causing Business Failure HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Recessions Economic
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Recessions Economic does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Strategies to Prevent Economic Recessions from Causing Business Failure | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Strategies to Prevent Economic Recessions from Causing Business Failure are -
Lack of clear differentiation of Recessions Economic products
– To increase the profitability and margins on the products, Recessions Economic needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Recessions Economic supply chain. Even after few cautionary changes mentioned in the HBR case study - Strategies to Prevent Economic Recessions from Causing Business Failure, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Recessions Economic vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Strategies to Prevent Economic Recessions from Causing Business Failure 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 Recessions Economic has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Recessions Economic is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Strategies to Prevent Economic Recessions from Causing Business Failure can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Recessions Economic, firm in the HBR case study Strategies to Prevent Economic Recessions from Causing Business Failure needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Recessions Economic 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Strategies to Prevent Economic Recessions from Causing Business Failure, in the dynamic environment Recessions Economic has struggled to respond to the nimble upstart competition. Recessions Economic 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, Recessions Economic 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Strategies to Prevent Economic Recessions from Causing Business Failure, is just above the industry average. Recessions Economic 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.
Products dominated business model
– Even though Recessions Economic 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 - Strategies to Prevent Economic Recessions from Causing Business Failure should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Steven C. Michael, John A. Pearce suggests that, Recessions Economic 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.
Opportunities Strategies to Prevent Economic Recessions from Causing Business Failure | 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 Strategies to Prevent Economic Recessions from Causing Business Failure are -
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Recessions Economic 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. Recessions Economic 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.
Manufacturing automation
– Recessions Economic 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Recessions Economic 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, Strategies to Prevent Economic Recessions from Causing Business Failure, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Recessions Economic can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Recessions Economic in the consumer business. Now Recessions Economic can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Recessions Economic 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Recessions Economic 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 Recessions Economic to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Recessions Economic 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 Strategies to Prevent Economic Recessions from Causing Business Failure - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Recessions Economic to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Recessions Economic to increase its market reach. Recessions Economic 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.
Buying journey improvements
– Recessions Economic can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Strategies to Prevent Economic Recessions from Causing Business Failure 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.
Building a culture of innovation
– managers at Recessions Economic 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Recessions Economic 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.
Loyalty marketing
– Recessions Economic 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.
Threats Strategies to Prevent Economic Recessions from Causing Business Failure External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Strategies to Prevent Economic Recessions from Causing Business Failure are -
Environmental challenges
– Recessions Economic 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. Recessions Economic can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Recessions Economic.
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 Recessions Economic business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Strategies to Prevent Economic Recessions from Causing Business Failure, Recessions Economic 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 .
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. Recessions Economic 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Recessions Economic with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Recessions Economic has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Recessions Economic 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Recessions Economic 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.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Recessions Economic can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Recessions Economic
– 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 Recessions Economic.
Shortening product life cycle
– it is one of the major threat that Recessions Economic is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Recessions Economic 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 Strategies to Prevent Economic Recessions from Causing Business Failure 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 Strategies to Prevent Economic Recessions from Causing Business Failure 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 Strategies to Prevent Economic Recessions from Causing Business Failure 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 Strategies to Prevent Economic Recessions from Causing Business Failure 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 Strategies to Prevent Economic Recessions from Causing Business Failure 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 Recessions Economic needs to make to build a sustainable competitive advantage.
