State Street Boston Corp.: Leading with Information Technology SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of State Street Boston Corp.: Leading with Information Technology
A financial institution, State Street Boston Corp., is transformed from regional bank to global custodian and money manager. The corresponding evolution of the company's information systems is illustrated, focusing on the role attributed to information technology in a difficult business context over the years. The innovative IT architecture adopted by the bank as a competitive weapon for the 1990s is discussed.
Swot Analysis of "State Street Boston Corp.: Leading with Information Technology" written by Donna B. Stoddard, Chiara Francalanci includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Street Boston facing as an external strategic factors. Some of the topics covered in State Street Boston Corp.: Leading with Information Technology case study are - Strategic Management Strategies, Growth strategy, IT and Technology & Operations.
Some of the macro environment factors that can be used to understand the State Street Boston Corp.: Leading with Information Technology casestudy better are - – central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, wage bills are increasing, supply chains are disrupted by pandemic , technology disruption, talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models,
increasing household debt because of falling income levels, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of State Street Boston Corp.: Leading with Information Technology
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in State Street Boston Corp.: Leading with Information Technology case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Street Boston, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Street Boston 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 State Street Boston Corp.: Leading with Information Technology can be done for the following purposes –
1. Strategic planning using facts provided in State Street Boston Corp.: Leading with Information Technology case study
2. Improving business portfolio management of Street Boston
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 Street Boston
Strengths State Street Boston Corp.: Leading with Information Technology | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Street Boston in State Street Boston Corp.: Leading with Information Technology Harvard Business Review case study are -
Analytics focus
– Street Boston 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 Donna B. Stoddard, Chiara Francalanci 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 Technology & Operations segment
- digital transformation varies from industry to industry. For Street Boston digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Street Boston 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.
Ability to recruit top talent
– Street Boston is one of the leading recruiters in the industry. Managers in the State Street Boston Corp.: Leading with Information Technology are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Street Boston has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Street Boston to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Street Boston 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.
Operational resilience
– The operational resilience strategy in the State Street Boston Corp.: Leading with Information Technology 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.
Innovation driven organization
– Street Boston is one of the most innovative firm in sector. Manager in State Street Boston Corp.: Leading with Information Technology Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Street Boston 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 State Street Boston Corp.: Leading with Information Technology - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Technology & Operations industry
– State Street Boston Corp.: Leading with Information Technology firm has clearly differentiated products in the market place. This has enabled Street Boston to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Street Boston to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Street Boston 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.
Highly skilled collaborators
– Street Boston 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 State Street Boston Corp.: Leading with Information Technology HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Street Boston is present in almost all the verticals within the industry. This has provided firm in State Street Boston Corp.: Leading with Information Technology 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.
Weaknesses State Street Boston Corp.: Leading with Information Technology | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of State Street Boston Corp.: Leading with Information Technology are -
Capital Spending Reduction
– Even during the low interest decade, Street Boston has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Street Boston has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Street Boston even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the State Street Boston Corp.: Leading with Information Technology 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 Street Boston has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study State Street Boston Corp.: Leading with Information Technology, it seems that the employees of Street Boston 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.
Increasing silos among functional specialists
– The organizational structure of Street Boston is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Street Boston needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Street Boston to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study State Street Boston Corp.: Leading with Information Technology, is just above the industry average. Street Boston 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 State Street Boston Corp.: Leading with Information Technology HBR case study mentions - Street Boston 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 operating costs
– Compare to the competitors, firm in the HBR case study State Street Boston Corp.: Leading with Information Technology 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 Street Boston 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, Donna B. Stoddard, Chiara Francalanci suggests that, Street Boston 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.
Skills based hiring
– The stress on hiring functional specialists at Street Boston 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Street Boston 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.
Opportunities State Street Boston Corp.: Leading with Information Technology | 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 State Street Boston Corp.: Leading with Information Technology are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Street Boston can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Street Boston in the consumer business. Now Street Boston can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Street Boston can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Street Boston in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Street Boston to increase its market reach. Street Boston 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.
Learning at scale
– Online learning technologies has now opened space for Street Boston 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Street Boston can use these opportunities to build new business models that can help the communities that Street Boston operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
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. Street Boston can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Street Boston 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.
Leveraging digital technologies
– Street Boston 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.
Using analytics as competitive advantage
– Street Boston 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 State Street Boston Corp.: Leading with Information Technology - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Street Boston to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Street Boston 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. Street Boston 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Street Boston 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, State Street Boston Corp.: Leading with Information Technology, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats State Street Boston Corp.: Leading with Information Technology External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study State Street Boston Corp.: Leading with Information Technology are -
Technology acceleration in Forth Industrial Revolution
– Street Boston has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Street Boston 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.
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 Street Boston.
High dependence on third party suppliers
– Street Boston 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.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Street Boston can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Street Boston with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Street Boston business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study State Street Boston Corp.: Leading with Information Technology, Street Boston 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 .
Regulatory challenges
– Street Boston 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Street Boston in the Technology & Operations industry. The Technology & Operations 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. Street Boston needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Consumer confidence and its impact on Street Boston 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.
Stagnating economy with rate increase
– Street Boston 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.
Weighted SWOT Analysis of State Street Boston Corp.: Leading with Information Technology 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 State Street Boston Corp.: Leading with Information Technology 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 State Street Boston Corp.: Leading with Information Technology 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 State Street Boston Corp.: Leading with Information Technology 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 State Street Boston Corp.: Leading with Information Technology 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 Street Boston needs to make to build a sustainable competitive advantage.