MCI Communications Corp.: Planning for the 1990s SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of MCI Communications Corp.: Planning for the 1990s
Concentrates on the evolution of MCI's strategy-setting process following a period of dramatic growth. Opportunistic strategies during MCI's early years have given top managers a dislike of formal strategic planning and a strongly-held belief in top down strategy setting. Questions whether the nature of planning will have to change as the company passes $6 billion in sales and is faced with increasing global competition.
Swot Analysis of "MCI Communications Corp.: Planning for the 1990s" written by Robert L. Simons, Hilary A. Weston includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mci's Planning facing as an external strategic factors. Some of the topics covered in MCI Communications Corp.: Planning for the 1990s case study are - Strategic Management Strategies, Corporate governance, Strategic planning and Finance & Accounting.
Some of the macro environment factors that can be used to understand the MCI Communications Corp.: Planning for the 1990s casestudy better are - – there is backlash against globalization, there is increasing trade war between United States & China, increasing energy prices, cloud computing is disrupting traditional business models, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs,
central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of MCI Communications Corp.: Planning for the 1990s
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MCI Communications Corp.: Planning for the 1990s case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mci's Planning, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mci's Planning 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 Communications Corp.: Planning for the 1990s can be done for the following purposes –
1. Strategic planning using facts provided in MCI Communications Corp.: Planning for the 1990s case study
2. Improving business portfolio management of Mci's Planning
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 Mci's Planning
Strengths MCI Communications Corp.: Planning for the 1990s | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mci's Planning in MCI Communications Corp.: Planning for the 1990s Harvard Business Review case study are -
High switching costs
– The high switching costs that Mci's Planning 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.
Cross disciplinary teams
– Horizontal connected teams at the Mci's Planning 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.
Superior customer experience
– The customer experience strategy of Mci's Planning in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Finance & Accounting field
– Mci's Planning 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 Mci's Planning in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Mci's Planning is one of the leading recruiters in the industry. Managers in the MCI Communications Corp.: Planning for the 1990s are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Mci's Planning in the sector have low bargaining power. MCI Communications Corp.: Planning for the 1990s has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mci's Planning to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Mci's Planning is present in almost all the verticals within the industry. This has provided firm in MCI Communications Corp.: Planning for the 1990s 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
– Mci's Planning is one of the most innovative firm in sector. Manager in MCI Communications Corp.: Planning for the 1990s Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Mci's Planning 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 Robert L. Simons, Hilary A. Weston 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Mci's Planning digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mci's Planning 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.
Training and development
– Mci's Planning has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in MCI Communications Corp.: Planning for the 1990s 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.
Strong track record of project management
– Mci's Planning is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses MCI Communications Corp.: Planning for the 1990s | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MCI Communications Corp.: Planning for the 1990s are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mci's Planning is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study MCI Communications Corp.: Planning for the 1990s can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Mci's Planning 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, Mci's Planning 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 Mci's Planning 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.
Products dominated business model
– Even though Mci's Planning 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 - MCI Communications Corp.: Planning for the 1990s should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study MCI Communications Corp.: Planning for the 1990s, 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.
Aligning sales with marketing
– It come across in the case study MCI Communications Corp.: Planning for the 1990s 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 Communications Corp.: Planning for the 1990s can leverage the sales team experience to cultivate customer relationships as Mci's Planning is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study MCI Communications Corp.: Planning for the 1990s 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 Mci's Planning 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Mci's Planning is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Mci's Planning needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Mci's Planning 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 MCI Communications Corp.: Planning for the 1990s, it seems that the employees of Mci's Planning 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.
Low market penetration in new markets
– Outside its home market of Mci's Planning, firm in the HBR case study MCI Communications Corp.: Planning for the 1990s needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities MCI Communications Corp.: Planning for the 1990s | 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 Communications Corp.: Planning for the 1990s are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Mci's Planning 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 Mci's Planning to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Mci's Planning 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.
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 Mci's Planning 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.
Using analytics as competitive advantage
– Mci's Planning 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 MCI Communications Corp.: Planning for the 1990s - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mci's Planning to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Mci's Planning 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 Mci's Planning to increase its market reach. Mci's Planning 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
– Mci's Planning can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. MCI Communications Corp.: Planning for the 1990s 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 Mci's Planning 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.
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 Mci's Planning in the consumer business. Now Mci's Planning can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Mci's Planning has opened avenues for new revenue streams for the organization in the industry. This can help Mci's Planning to build a more holistic ecosystem as suggested in the MCI Communications Corp.: Planning for the 1990s case study. Mci's Planning can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mci's Planning can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Mci's Planning is facing challenges because of the dominance of functional experts in the organization. MCI Communications Corp.: Planning for the 1990s 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
– Mci's Planning 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.
Threats MCI Communications Corp.: Planning for the 1990s External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MCI Communications Corp.: Planning for the 1990s are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mci's Planning 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 MCI Communications Corp.: Planning for the 1990s .
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.
Shortening product life cycle
– it is one of the major threat that Mci's Planning is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Mci's Planning
– 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 Mci's Planning.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Mci's Planning in the Finance & Accounting sector and impact the bottomline of the organization.
Environmental challenges
– Mci's Planning 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. Mci's Planning can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
High dependence on third party suppliers
– Mci's Planning 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.
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 Mci's Planning business can come under increasing regulations regarding data privacy, data security, etc.
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.
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. Mci's Planning needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Consumer confidence and its impact on Mci's Planning 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.
Regulatory challenges
– Mci's Planning 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.
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. Mci's Planning can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of MCI Communications Corp.: Planning for the 1990s 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 Communications Corp.: Planning for the 1990s 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 Communications Corp.: Planning for the 1990s 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 Communications Corp.: Planning for the 1990s 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 Communications Corp.: Planning for the 1990s 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 Mci's Planning needs to make to build a sustainable competitive advantage.