Case Study Description of MCI Takeover Battle: Verizon Versus Qwest
MCI's board of directors is considering competing bids from Verizon and Qwest. Qwest, a smaller company with a weaker balance sheet, is offering almost a billion dollars more. But Verizon, one of the largest telecommunications companies in the world, has a history of successful mergers and acquisitions.
Swot Analysis of "MCI Takeover Battle: Verizon Versus Qwest" written by Malcolm P. Baker, James Quinn includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Qwest Verizon facing as an external strategic factors. Some of the topics covered in MCI Takeover Battle: Verizon Versus Qwest case study are - Strategic Management Strategies, Financial analysis, Financial management, Financial markets, Mergers & acquisitions, Negotiations and Finance & Accounting.
Some of the macro environment factors that can be used to understand the MCI Takeover Battle: Verizon Versus Qwest casestudy better are - – geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, technology disruption, increasing transportation and logistics costs, there is backlash against globalization, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models,
increasing commodity prices, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of MCI Takeover Battle: Verizon Versus Qwest
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MCI Takeover Battle: Verizon Versus Qwest case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Qwest Verizon, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Qwest Verizon 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 MCI Takeover Battle: Verizon Versus Qwest can be done for the following purposes –
1. Strategic planning using facts provided in MCI Takeover Battle: Verizon Versus Qwest case study
2. Improving business portfolio management of Qwest Verizon
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 Qwest Verizon
Strengths MCI Takeover Battle: Verizon Versus Qwest | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Qwest Verizon in MCI Takeover Battle: Verizon Versus Qwest Harvard Business Review case study are -
Analytics focus
– Qwest Verizon 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 Malcolm P. Baker, James Quinn 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 brand equity
– Qwest Verizon has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Qwest Verizon to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Qwest Verizon has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Qwest Verizon 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.
Strong track record of project management
– Qwest Verizon is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Qwest Verizon is one of the most innovative firm in sector. Manager in MCI Takeover Battle: Verizon Versus Qwest Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Finance & Accounting industry
– MCI Takeover Battle: Verizon Versus Qwest firm has clearly differentiated products in the market place. This has enabled Qwest Verizon to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Qwest Verizon to invest into research and development (R&D) and innovation.
Ability to lead change in Finance & Accounting field
– Qwest Verizon 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 Qwest Verizon in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Qwest Verizon digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Qwest Verizon 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.
Cross disciplinary teams
– Horizontal connected teams at the Qwest Verizon 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.
Ability to recruit top talent
– Qwest Verizon is one of the leading recruiters in the industry. Managers in the MCI Takeover Battle: Verizon Versus Qwest are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Qwest Verizon is present in almost all the verticals within the industry. This has provided firm in MCI Takeover Battle: Verizon Versus Qwest 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.
Training and development
– Qwest Verizon has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in MCI Takeover Battle: Verizon Versus Qwest 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.
Weaknesses MCI Takeover Battle: Verizon Versus Qwest | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MCI Takeover Battle: Verizon Versus Qwest are -
Aligning sales with marketing
– It come across in the case study MCI Takeover Battle: Verizon Versus Qwest 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 MCI Takeover Battle: Verizon Versus Qwest can leverage the sales team experience to cultivate customer relationships as Qwest Verizon is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study MCI Takeover Battle: Verizon Versus Qwest 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 Qwest Verizon 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study MCI Takeover Battle: Verizon Versus Qwest, in the dynamic environment Qwest Verizon has struggled to respond to the nimble upstart competition. Qwest Verizon has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Qwest Verizon 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.
Slow decision making process
– As mentioned earlier in the report, Qwest Verizon 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. Qwest Verizon 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 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 Qwest Verizon supply chain. Even after few cautionary changes mentioned in the HBR case study - MCI Takeover Battle: Verizon Versus Qwest, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Qwest Verizon vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study MCI Takeover Battle: Verizon Versus Qwest, it seems that company is thinking about the frontier risks that can impact Finance & Accounting strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the MCI Takeover Battle: Verizon Versus Qwest 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 Qwest Verizon has relatively successful track record of launching new products.
Need for greater diversity
– Qwest Verizon 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.
Interest costs
– Compare to the competition, Qwest Verizon 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.
Skills based hiring
– The stress on hiring functional specialists at Qwest Verizon 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.
Opportunities MCI Takeover Battle: Verizon Versus Qwest | 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 MCI Takeover Battle: Verizon Versus Qwest are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Qwest Verizon can use these opportunities to build new business models that can help the communities that Qwest Verizon operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Manufacturing automation
– Qwest Verizon 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.
Developing new processes and practices
– Qwest Verizon 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Qwest Verizon 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, MCI Takeover Battle: Verizon Versus Qwest, 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, Qwest Verizon is facing challenges because of the dominance of functional experts in the organization. MCI Takeover Battle: Verizon Versus Qwest 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.
Leveraging digital technologies
– Qwest Verizon 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.
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. Qwest Verizon 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. Qwest Verizon 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.
Learning at scale
– Online learning technologies has now opened space for Qwest Verizon 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.
Creating value in data economy
– The success of analytics program of Qwest Verizon has opened avenues for new revenue streams for the organization in the industry. This can help Qwest Verizon to build a more holistic ecosystem as suggested in the MCI Takeover Battle: Verizon Versus Qwest case study. Qwest Verizon can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Qwest Verizon in the consumer business. Now Qwest Verizon can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Qwest Verizon 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.
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 Qwest Verizon 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Qwest Verizon 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 Qwest Verizon to hire the very best people irrespective of their geographical location.
Threats MCI Takeover Battle: Verizon Versus Qwest External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MCI Takeover Battle: Verizon Versus Qwest are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Qwest Verizon with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Qwest Verizon business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Qwest Verizon 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 Finance & Accounting industry regulations.
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.
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 Qwest Verizon.
Environmental challenges
– Qwest Verizon 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. Qwest Verizon can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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.
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. Qwest Verizon can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Qwest Verizon 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.
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. Qwest Verizon needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Qwest Verizon has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Qwest Verizon 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.
Consumer confidence and its impact on Qwest Verizon 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.
Increasing wage structure of Qwest Verizon
– 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 Qwest Verizon.
Weighted SWOT Analysis of MCI Takeover Battle: Verizon Versus Qwest 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 MCI Takeover Battle: Verizon Versus Qwest 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 MCI Takeover Battle: Verizon Versus Qwest 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 MCI Takeover Battle: Verizon Versus Qwest 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 MCI Takeover Battle: Verizon Versus Qwest 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 Qwest Verizon needs to make to build a sustainable competitive advantage.
