Bank of America Tower: Redesigning Skyscrapers SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Bank of America Tower: Redesigning Skyscrapers
This is a Darden case study.This is a minicase, one of 10 in a set of short cases written to illustrate the business benefits companies realize through adopting sustainable business strategies. This minicase describes Bank of America's new headquarters building in New York City focusing on the "green" or sustainable design features used and anticipated benefits.
Swot Analysis of "Bank of America Tower: Redesigning Skyscrapers" written by Andrea Larson, Anne Eckhoff includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Minicase Skyscrapers facing as an external strategic factors. Some of the topics covered in Bank of America Tower: Redesigning Skyscrapers case study are - Strategic Management Strategies, Marketing, Operations management, Strategy execution, Sustainability, Technology and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Bank of America Tower: Redesigning Skyscrapers casestudy better are - – increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , increasing transportation and logistics costs, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%,
technology disruption, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Bank of America Tower: Redesigning Skyscrapers
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bank of America Tower: Redesigning Skyscrapers case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Minicase Skyscrapers, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Minicase Skyscrapers 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 Bank of America Tower: Redesigning Skyscrapers can be done for the following purposes –
1. Strategic planning using facts provided in Bank of America Tower: Redesigning Skyscrapers case study
2. Improving business portfolio management of Minicase Skyscrapers
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 Minicase Skyscrapers
Strengths Bank of America Tower: Redesigning Skyscrapers | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Minicase Skyscrapers in Bank of America Tower: Redesigning Skyscrapers Harvard Business Review case study are -
Learning organization
- Minicase Skyscrapers 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 Minicase Skyscrapers is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bank of America Tower: Redesigning Skyscrapers Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Minicase Skyscrapers 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.
Training and development
– Minicase Skyscrapers has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Bank of America Tower: Redesigning Skyscrapers 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 Minicase Skyscrapers
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Minicase Skyscrapers does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Finance & Accounting field
– Minicase Skyscrapers 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 Minicase Skyscrapers in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Bank of America Tower: Redesigning Skyscrapers Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Low bargaining power of suppliers
– Suppliers of Minicase Skyscrapers in the sector have low bargaining power. Bank of America Tower: Redesigning Skyscrapers has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Minicase Skyscrapers to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Minicase Skyscrapers is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Minicase Skyscrapers 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 Finance & Accounting industry
– Bank of America Tower: Redesigning Skyscrapers firm has clearly differentiated products in the market place. This has enabled Minicase Skyscrapers to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Minicase Skyscrapers to invest into research and development (R&D) and innovation.
Analytics focus
– Minicase Skyscrapers 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 Andrea Larson, Anne Eckhoff 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.
Successful track record of launching new products
– Minicase Skyscrapers has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Minicase Skyscrapers 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.
Weaknesses Bank of America Tower: Redesigning Skyscrapers | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bank of America Tower: Redesigning Skyscrapers are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bank of America Tower: Redesigning Skyscrapers 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 Minicase Skyscrapers has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Bank of America Tower: Redesigning Skyscrapers 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 Minicase Skyscrapers 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Minicase Skyscrapers is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Minicase Skyscrapers needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Minicase Skyscrapers to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Minicase Skyscrapers 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.
Interest costs
– Compare to the competition, Minicase Skyscrapers 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.
Capital Spending Reduction
– Even during the low interest decade, Minicase Skyscrapers 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.
Low market penetration in new markets
– Outside its home market of Minicase Skyscrapers, firm in the HBR case study Bank of America Tower: Redesigning Skyscrapers needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Minicase Skyscrapers products
– To increase the profitability and margins on the products, Minicase Skyscrapers needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Bank of America Tower: Redesigning Skyscrapers, is just above the industry average. Minicase Skyscrapers 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Bank of America Tower: Redesigning Skyscrapers, in the dynamic environment Minicase Skyscrapers has struggled to respond to the nimble upstart competition. Minicase Skyscrapers has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As Bank of America Tower: Redesigning Skyscrapers HBR case study mentions - Minicase Skyscrapers 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.
Opportunities Bank of America Tower: Redesigning Skyscrapers | 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 Bank of America Tower: Redesigning Skyscrapers are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Minicase Skyscrapers can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Minicase Skyscrapers 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.
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 Minicase Skyscrapers in the consumer business. Now Minicase Skyscrapers can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Minicase Skyscrapers 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.
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 Minicase Skyscrapers 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Minicase Skyscrapers can use these opportunities to build new business models that can help the communities that Minicase Skyscrapers operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Creating value in data economy
– The success of analytics program of Minicase Skyscrapers has opened avenues for new revenue streams for the organization in the industry. This can help Minicase Skyscrapers to build a more holistic ecosystem as suggested in the Bank of America Tower: Redesigning Skyscrapers case study. Minicase Skyscrapers can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Minicase Skyscrapers 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 Minicase Skyscrapers to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Minicase Skyscrapers 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Minicase Skyscrapers 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.
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. Minicase Skyscrapers 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. Minicase Skyscrapers 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Minicase Skyscrapers can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Minicase Skyscrapers 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.
Threats Bank of America Tower: Redesigning Skyscrapers External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bank of America Tower: Redesigning Skyscrapers are -
Consumer confidence and its impact on Minicase Skyscrapers 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Minicase Skyscrapers 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 Bank of America Tower: Redesigning Skyscrapers .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Minicase Skyscrapers 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 Minicase Skyscrapers business can come under increasing regulations regarding data privacy, data security, etc.
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. Minicase Skyscrapers can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Minicase Skyscrapers in the Finance & Accounting sector and impact the bottomline 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. Minicase Skyscrapers needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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. Minicase Skyscrapers 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.
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.
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 Minicase Skyscrapers.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Bank of America Tower: Redesigning Skyscrapers, Minicase Skyscrapers may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Shortening product life cycle
– it is one of the major threat that Minicase Skyscrapers is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Bank of America Tower: Redesigning Skyscrapers 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 Bank of America Tower: Redesigning Skyscrapers 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 Bank of America Tower: Redesigning Skyscrapers 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 Bank of America Tower: Redesigning Skyscrapers 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 Bank of America Tower: Redesigning Skyscrapers 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 Minicase Skyscrapers needs to make to build a sustainable competitive advantage.
