Charlie Merrill and the Financial Supermarket Strategy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Charlie Merrill and the Financial Supermarket Strategy
Charles "Charlie" E. Merrill was a visionary who opened the door to investing for the masses in America. The "financial supermarket" strategy, which Merrill conceived in the late thirties, revolutionized the brokerage and financial services of his time and is widely recognized as one of the most important strategic innovations in the history of the financial sector. This case opens a window on the genesis of Merrill's strategic insight. It focuses especially on how Merrill came to identify the analogy (banking as supermarkets) that led him to see his industry through a very different lens than most of strategic leaders at competing firms.
Authors :: Giovanni Gavetti, Anoop Ramachandran Menon, Katherine Dowd
Swot Analysis of "Charlie Merrill and the Financial Supermarket Strategy" written by Giovanni Gavetti, Anoop Ramachandran Menon, Katherine Dowd includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Merrill Charlie facing as an external strategic factors. Some of the topics covered in Charlie Merrill and the Financial Supermarket Strategy case study are - Strategic Management Strategies, Creativity, Financial management, Financial markets, Strategy execution and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Charlie Merrill and the Financial Supermarket Strategy casestudy better are - – there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , technology disruption, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy,
central banks are concerned over increasing inflation, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Charlie Merrill and the Financial Supermarket Strategy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Charlie Merrill and the Financial Supermarket Strategy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Merrill Charlie, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Merrill Charlie 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 Charlie Merrill and the Financial Supermarket Strategy can be done for the following purposes –
1. Strategic planning using facts provided in Charlie Merrill and the Financial Supermarket Strategy case study
2. Improving business portfolio management of Merrill Charlie
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 Merrill Charlie
Strengths Charlie Merrill and the Financial Supermarket Strategy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Merrill Charlie in Charlie Merrill and the Financial Supermarket Strategy Harvard Business Review case study are -
Organizational Resilience of Merrill Charlie
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Merrill Charlie does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Merrill Charlie is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Merrill Charlie has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Charlie Merrill and the Financial Supermarket Strategy 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.
Diverse revenue streams
– Merrill Charlie is present in almost all the verticals within the industry. This has provided firm in Charlie Merrill and the Financial Supermarket Strategy 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.
Innovation driven organization
– Merrill Charlie is one of the most innovative firm in sector. Manager in Charlie Merrill and the Financial Supermarket Strategy Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Merrill Charlie 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 Charlie Merrill and the Financial Supermarket Strategy HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Strategy & Execution industry
– Charlie Merrill and the Financial Supermarket Strategy firm has clearly differentiated products in the market place. This has enabled Merrill Charlie to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Merrill Charlie to invest into research and development (R&D) and innovation.
Ability to lead change in Strategy & Execution field
– Merrill Charlie 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 Merrill Charlie in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Merrill Charlie has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Superior customer experience
– The customer experience strategy of Merrill Charlie in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Merrill Charlie 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 Giovanni Gavetti, Anoop Ramachandran Menon, Katherine Dowd 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
– Merrill Charlie has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Merrill Charlie to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Charlie Merrill and the Financial Supermarket Strategy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Charlie Merrill and the Financial Supermarket Strategy are -
Low market penetration in new markets
– Outside its home market of Merrill Charlie, firm in the HBR case study Charlie Merrill and the Financial Supermarket Strategy needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Merrill Charlie is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Charlie Merrill and the Financial Supermarket Strategy can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Merrill Charlie 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Charlie Merrill and the Financial Supermarket Strategy 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 Merrill Charlie 's lucrative customers.
Products dominated business model
– Even though Merrill Charlie 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 - Charlie Merrill and the Financial Supermarket Strategy 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, Giovanni Gavetti, Anoop Ramachandran Menon, Katherine Dowd suggests that, Merrill Charlie 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.
Capital Spending Reduction
– Even during the low interest decade, Merrill Charlie 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.
Slow decision making process
– As mentioned earlier in the report, Merrill Charlie 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. Merrill Charlie 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.
Interest costs
– Compare to the competition, Merrill Charlie 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Charlie Merrill and the Financial Supermarket Strategy, it seems that the employees of Merrill Charlie 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.
Aligning sales with marketing
– It come across in the case study Charlie Merrill and the Financial Supermarket Strategy 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 Charlie Merrill and the Financial Supermarket Strategy can leverage the sales team experience to cultivate customer relationships as Merrill Charlie is planning to shift buying processes online.
Opportunities Charlie Merrill and the Financial Supermarket Strategy | 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 Charlie Merrill and the Financial Supermarket Strategy are -
Learning at scale
– Online learning technologies has now opened space for Merrill Charlie 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.
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. Merrill Charlie 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. Merrill Charlie 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.
Using analytics as competitive advantage
– Merrill Charlie 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 Charlie Merrill and the Financial Supermarket Strategy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Merrill Charlie to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Merrill Charlie in the consumer business. Now Merrill Charlie can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Merrill Charlie 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Merrill Charlie 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 Merrill Charlie to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Merrill Charlie 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Merrill Charlie is facing challenges because of the dominance of functional experts in the organization. Charlie Merrill and the Financial Supermarket Strategy 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.
Developing new processes and practices
– Merrill Charlie can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Manufacturing automation
– Merrill Charlie 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Merrill Charlie 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Merrill Charlie can use these opportunities to build new business models that can help the communities that Merrill Charlie operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Better consumer reach
– The expansion of the 5G network will help Merrill Charlie to increase its market reach. Merrill Charlie 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.
Threats Charlie Merrill and the Financial Supermarket Strategy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Charlie Merrill and the Financial Supermarket Strategy are -
Regulatory challenges
– Merrill Charlie needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Merrill Charlie with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
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 Merrill Charlie.
Stagnating economy with rate increase
– Merrill Charlie 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.
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.
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 Merrill Charlie business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Merrill Charlie 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. Merrill Charlie can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Merrill Charlie 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 Merrill Charlie is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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 Charlie Merrill and the Financial Supermarket Strategy, Merrill Charlie 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 .
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. Merrill Charlie needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Merrill Charlie 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.
Weighted SWOT Analysis of Charlie Merrill and the Financial Supermarket Strategy 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 Charlie Merrill and the Financial Supermarket Strategy 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 Charlie Merrill and the Financial Supermarket Strategy 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 Charlie Merrill and the Financial Supermarket Strategy 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 Charlie Merrill and the Financial Supermarket Strategy 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 Merrill Charlie needs to make to build a sustainable competitive advantage.