Case Study Description of Laurentian Bank: B2B Trust
Executives of the Laurentian Bank of Canada were reviewing their plans for the launch of B2B Trust--a new business that would become Canada's first Internet-enabled wholesaler of financial services and products. If they proceed, they would be making a major internal and external commitment to a new way of doing business. They wanted to be sure they had it right and that the introduction would go smoothly. During this review, they needed to facilitate a strategic analysis of the B2B Trust initiative--assess the validity of the concepts, the appropriateness of it for the Laurentian Bank, and prepare recommendations for senior management.
Swot Analysis of "Laurentian Bank: B2B Trust" written by Joseph N. Fry includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Laurentian B2b facing as an external strategic factors. Some of the topics covered in Laurentian Bank: B2B Trust case study are - Strategic Management Strategies, and Technology & Operations.
Some of the macro environment factors that can be used to understand the Laurentian Bank: B2B Trust casestudy better are - – increasing energy prices, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, increasing transportation and logistics costs, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , increasing commodity prices,
increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Laurentian Bank: B2B Trust
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Laurentian Bank: B2B Trust case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Laurentian B2b, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Laurentian B2b 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 Laurentian Bank: B2B Trust can be done for the following purposes –
1. Strategic planning using facts provided in Laurentian Bank: B2B Trust case study
2. Improving business portfolio management of Laurentian B2b
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Laurentian B2b
Strengths Laurentian Bank: B2B Trust | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Laurentian B2b in Laurentian Bank: B2B Trust Harvard Business Review case study are -
Ability to recruit top talent
– Laurentian B2b is one of the leading recruiters in the industry. Managers in the Laurentian Bank: B2B Trust are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Laurentian B2b has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Laurentian Bank: B2B Trust - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Laurentian B2b 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 Laurentian B2b is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Laurentian Bank: B2B Trust Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Laurentian B2b has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Laurentian Bank: B2B Trust 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.
Sustainable margins compare to other players in Technology & Operations industry
– Laurentian Bank: B2B Trust firm has clearly differentiated products in the market place. This has enabled Laurentian B2b to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Laurentian B2b to invest into research and development (R&D) and innovation.
Analytics focus
– Laurentian B2b 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 N. Fry 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
– Laurentian B2b has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Laurentian B2b 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.
High switching costs
– The high switching costs that Laurentian B2b 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.
Highly skilled collaborators
– Laurentian B2b 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 Laurentian Bank: B2B Trust HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Laurentian B2b in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Laurentian B2b is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Laurentian B2b is one of the most innovative firm in sector. Manager in Laurentian Bank: B2B Trust Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Laurentian Bank: B2B Trust | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Laurentian Bank: B2B Trust are -
Lack of clear differentiation of Laurentian B2b products
– To increase the profitability and margins on the products, Laurentian B2b 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 Laurentian Bank: B2B Trust, is just above the industry average. Laurentian B2b 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.
No frontier risks strategy
– After analyzing the HBR case study Laurentian Bank: B2B Trust, it seems that company is thinking about the frontier risks that can impact Technology & Operations 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.
Interest costs
– Compare to the competition, Laurentian B2b 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.
Products dominated business model
– Even though Laurentian B2b 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 - Laurentian Bank: B2B Trust should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Laurentian Bank: B2B Trust 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 Laurentian B2b has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Laurentian B2b 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Laurentian Bank: B2B Trust, in the dynamic environment Laurentian B2b has struggled to respond to the nimble upstart competition. Laurentian B2b has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Laurentian B2b 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.
Increasing silos among functional specialists
– The organizational structure of Laurentian B2b is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Laurentian B2b needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Laurentian B2b to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Joseph N. Fry suggests that, Laurentian B2b 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.
Opportunities Laurentian Bank: B2B Trust | 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 Laurentian Bank: B2B Trust are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Laurentian B2b is facing challenges because of the dominance of functional experts in the organization. Laurentian Bank: B2B Trust 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Laurentian B2b can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Laurentian B2b 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, Laurentian Bank: B2B Trust, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Laurentian B2b 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 Laurentian Bank: B2B Trust - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Laurentian B2b to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Laurentian B2b can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Laurentian Bank: B2B Trust 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.
Manufacturing automation
– Laurentian B2b can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
Creating value in data economy
– The success of analytics program of Laurentian B2b has opened avenues for new revenue streams for the organization in the industry. This can help Laurentian B2b to build a more holistic ecosystem as suggested in the Laurentian Bank: B2B Trust case study. Laurentian B2b can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Laurentian B2b can develop new processes and procedures in Technology & Operations 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Laurentian B2b 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 Laurentian B2b to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Laurentian B2b 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Laurentian B2b 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 Laurentian B2b 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.
Building a culture of innovation
– managers at Laurentian B2b 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 Technology & Operations segment.
Threats Laurentian Bank: B2B Trust External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Laurentian Bank: B2B Trust are -
Technology acceleration in Forth Industrial Revolution
– Laurentian B2b has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Laurentian B2b needs to keep up with the evolution of technology in the Technology & Operations sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Consumer confidence and its impact on Laurentian B2b 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.
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 Laurentian B2b business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Laurentian B2b 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 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. Laurentian B2b needs to understand the core reasons impacting the Technology & Operations 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.
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.
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. Laurentian B2b 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.
High dependence on third party suppliers
– Laurentian B2b 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.
Regulatory challenges
– Laurentian B2b 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 Technology & Operations industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Laurentian B2b 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 Laurentian Bank: B2B Trust .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Laurentian Bank: B2B Trust, Laurentian B2b may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Increasing wage structure of Laurentian B2b
– 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 Laurentian B2b.
Weighted SWOT Analysis of Laurentian Bank: B2B Trust 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 Laurentian Bank: B2B Trust 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 Laurentian Bank: B2B Trust 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 Laurentian Bank: B2B Trust 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 Laurentian Bank: B2B Trust 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 Laurentian B2b needs to make to build a sustainable competitive advantage.
