Loews Corporation: Corporate Strategy as a Portfolio SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Loews Corporation: Corporate Strategy as a Portfolio
In 2007, Loews Inc., under the leadership of James Tisch, was considering whether to buy natural gas properties from Dominion Resources. The question is whether the acquisition fits the corporate strategy. In exploring the questions, students will have the chance to consider what is in fact a corporate strategy, how Loews' corporate strategy adds value, and how the way Loews is managed contributes to the results-a tripling of market value in 5 years.
Swot Analysis of "Loews Corporation: Corporate Strategy as a Portfolio" written by Joseph L. Bower includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Loews Corporate facing as an external strategic factors. Some of the topics covered in Loews Corporation: Corporate Strategy as a Portfolio case study are - Strategic Management Strategies, Leadership, Leading teams, Mergers & acquisitions and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Loews Corporation: Corporate Strategy as a Portfolio casestudy better are - – increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, wage bills are increasing, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy,
supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Loews Corporation: Corporate Strategy as a Portfolio
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Loews Corporation: Corporate Strategy as a Portfolio case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Loews Corporate, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Loews Corporate 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 Loews Corporation: Corporate Strategy as a Portfolio can be done for the following purposes –
1. Strategic planning using facts provided in Loews Corporation: Corporate Strategy as a Portfolio case study
2. Improving business portfolio management of Loews Corporate
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 Loews Corporate
Strengths Loews Corporation: Corporate Strategy as a Portfolio | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Loews Corporate in Loews Corporation: Corporate Strategy as a Portfolio Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Loews Corporate in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Loews Corporate in the sector have low bargaining power. Loews Corporation: Corporate Strategy as a Portfolio has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Loews Corporate to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Loews Corporate 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 Loews Corporate is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Loews Corporation: Corporate Strategy as a Portfolio Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Loews Corporate 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 Joseph L. Bower 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.
Ability to lead change in Strategy & Execution field
– Loews Corporate 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 Loews Corporate in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Loews Corporate has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Loews Corporation: Corporate Strategy as a Portfolio 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.
Organizational Resilience of Loews Corporate
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Loews Corporate does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Loews Corporate 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Loews Corporation: Corporate Strategy as a Portfolio firm has clearly differentiated products in the market place. This has enabled Loews Corporate to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Loews Corporate to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Loews Corporate 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 Loews Corporation: Corporate Strategy as a Portfolio HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Loews Corporate has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Loews Corporate to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Loews Corporate is one of the leading recruiters in the industry. Managers in the Loews Corporation: Corporate Strategy as a Portfolio are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Loews Corporation: Corporate Strategy as a Portfolio | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Loews Corporation: Corporate Strategy as a Portfolio are -
High operating costs
– Compare to the competitors, firm in the HBR case study Loews Corporation: Corporate Strategy as a Portfolio 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 Loews Corporate 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Loews Corporation: Corporate Strategy as a Portfolio, it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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.
Capital Spending Reduction
– Even during the low interest decade, Loews Corporate 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 Loews Corporation: Corporate Strategy as a Portfolio, is just above the industry average. Loews Corporate 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.
Slow to strategic competitive environment developments
– As Loews Corporation: Corporate Strategy as a Portfolio HBR case study mentions - Loews Corporate takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
High cash cycle compare to competitors
Loews Corporate 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.
Increasing silos among functional specialists
– The organizational structure of Loews Corporate is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Loews Corporate needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Loews Corporate to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Loews Corporation: Corporate Strategy as a Portfolio, it seems that the employees of Loews Corporate 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Joseph L. Bower suggests that, Loews Corporate 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Loews Corporation: Corporate Strategy as a Portfolio, in the dynamic environment Loews Corporate has struggled to respond to the nimble upstart competition. Loews Corporate has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Loews Corporate is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Loews Corporation: Corporate Strategy as a Portfolio can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Loews Corporation: Corporate Strategy as a Portfolio | 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 Loews Corporation: Corporate Strategy as a Portfolio are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Loews Corporate 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, Loews Corporation: Corporate Strategy as a Portfolio, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Loews Corporate can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Loews Corporate 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Loews Corporate can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Loews Corporate 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 Loews Corporation: Corporate Strategy as a Portfolio - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Loews Corporate to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Loews Corporate 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.
Better consumer reach
– The expansion of the 5G network will help Loews Corporate to increase its market reach. Loews Corporate 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.
Manufacturing automation
– Loews Corporate 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.
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 Loews Corporate in the consumer business. Now Loews Corporate can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Loews Corporate can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Loews Corporation: Corporate Strategy as a Portfolio 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 Loews Corporate 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Loews Corporate 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 Loews Corporate to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Loews Corporate can use these opportunities to build new business models that can help the communities that Loews Corporate operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Threats Loews Corporation: Corporate Strategy as a Portfolio External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Loews Corporation: Corporate Strategy as a Portfolio are -
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 Loews Corporate.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Loews Corporate can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Loews Corporation: Corporate Strategy as a Portfolio .
Shortening product life cycle
– it is one of the major threat that Loews Corporate 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
– Loews Corporate 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.
High dependence on third party suppliers
– Loews Corporate high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Increasing wage structure of Loews Corporate
– 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 Loews Corporate.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Loews Corporation: Corporate Strategy as a Portfolio, Loews Corporate 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. Loews Corporate 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Loews Corporate 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.
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. Loews Corporate needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
Environmental challenges
– Loews Corporate 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. Loews Corporate can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Regulatory challenges
– Loews Corporate 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.
Weighted SWOT Analysis of Loews Corporation: Corporate Strategy as a Portfolio 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 Loews Corporation: Corporate Strategy as a Portfolio 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 Loews Corporation: Corporate Strategy as a Portfolio 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 Loews Corporation: Corporate Strategy as a Portfolio 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 Loews Corporation: Corporate Strategy as a Portfolio 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 Loews Corporate needs to make to build a sustainable competitive advantage.
