The role of information technology systems in the performance of mergers and acquisitions SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The role of information technology systems in the performance of mergers and acquisitions
Mergers and acquisitions (M&As) are an important tool for improving a firm's competitive positioning and performance. Despite M&As' promise, however, they often fail to meet performance goals. Challenges often arise when managers try to integrate two companies' information technology (IT) systems, and the difficulties encountered often create both short- and long-term performance problems for companies. To help address these challenges, we highlight important issues that managers involved in M&As must consider. We also present some best practices that managers should follow to improve the odds of successful IT integration.
Authors :: Franz T. Lohrke, Cynthia Frownfelter-Lohrke, David Ketchen Jr.
Swot Analysis of "The role of information technology systems in the performance of mergers and acquisitions" written by Franz T. Lohrke, Cynthia Frownfelter-Lohrke, David Ketchen Jr. includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Performance Mergers facing as an external strategic factors. Some of the topics covered in The role of information technology systems in the performance of mergers and acquisitions case study are - Strategic Management Strategies, Mergers & acquisitions and Technology & Operations.
Some of the macro environment factors that can be used to understand the The role of information technology systems in the performance of mergers and acquisitions casestudy better are - – talent flight as more people leaving formal jobs, increasing energy prices, increasing government debt because of Covid-19 spendings, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, central banks are concerned over increasing inflation,
challanges to central banks by blockchain based private currencies, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of The role of information technology systems in the performance of mergers and acquisitions
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The role of information technology systems in the performance of mergers and acquisitions case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Performance Mergers, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Performance Mergers 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 The role of information technology systems in the performance of mergers and acquisitions can be done for the following purposes –
1. Strategic planning using facts provided in The role of information technology systems in the performance of mergers and acquisitions case study
2. Improving business portfolio management of Performance Mergers
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 Performance Mergers
Strengths The role of information technology systems in the performance of mergers and acquisitions | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Performance Mergers in The role of information technology systems in the performance of mergers and acquisitions Harvard Business Review case study are -
Effective Research and Development (R&D)
– Performance Mergers 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 The role of information technology systems in the performance of mergers and acquisitions - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Performance Mergers is one of the most innovative firm in sector. Manager in The role of information technology systems in the performance of mergers and acquisitions Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Performance Mergers digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Performance Mergers 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.
Analytics focus
– Performance Mergers 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 Franz T. Lohrke, Cynthia Frownfelter-Lohrke, David Ketchen Jr. 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.
Highly skilled collaborators
– Performance Mergers 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 The role of information technology systems in the performance of mergers and acquisitions HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Technology & Operations field
– Performance Mergers 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 Performance Mergers in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Performance Mergers has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The role of information technology systems in the performance of mergers and acquisitions 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.
Low bargaining power of suppliers
– Suppliers of Performance Mergers in the sector have low bargaining power. The role of information technology systems in the performance of mergers and acquisitions has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Performance Mergers to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Performance Mergers has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Performance Mergers 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.
Ability to recruit top talent
– Performance Mergers is one of the leading recruiters in the industry. Managers in the The role of information technology systems in the performance of mergers and acquisitions are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Performance Mergers 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 Technology & Operations industry
– The role of information technology systems in the performance of mergers and acquisitions firm has clearly differentiated products in the market place. This has enabled Performance Mergers to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Performance Mergers to invest into research and development (R&D) and innovation.
Weaknesses The role of information technology systems in the performance of mergers and acquisitions | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The role of information technology systems in the performance of mergers and acquisitions are -
Workers concerns about automation
– As automation is fast increasing in the segment, Performance Mergers 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.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Performance Mergers supply chain. Even after few cautionary changes mentioned in the HBR case study - The role of information technology systems in the performance of mergers and acquisitions, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Performance Mergers vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The role of information technology systems in the performance of mergers and acquisitions, is just above the industry average. Performance Mergers 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.
Capital Spending Reduction
– Even during the low interest decade, Performance Mergers 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.
Products dominated business model
– Even though Performance Mergers 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 - The role of information technology systems in the performance of mergers and acquisitions 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 The role of information technology systems in the performance of mergers and acquisitions, 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.
High operating costs
– Compare to the competitors, firm in the HBR case study The role of information technology systems in the performance of mergers and acquisitions 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 Performance Mergers 's lucrative customers.
Slow to strategic competitive environment developments
– As The role of information technology systems in the performance of mergers and acquisitions HBR case study mentions - Performance Mergers 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.
Lack of clear differentiation of Performance Mergers products
– To increase the profitability and margins on the products, Performance Mergers needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Performance Mergers has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Low market penetration in new markets
– Outside its home market of Performance Mergers, firm in the HBR case study The role of information technology systems in the performance of mergers and acquisitions needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities The role of information technology systems in the performance of mergers and acquisitions | 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 The role of information technology systems in the performance of mergers and acquisitions are -
Manufacturing automation
– Performance Mergers 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Performance Mergers 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Performance Mergers 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.
Learning at scale
– Online learning technologies has now opened space for Performance Mergers 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.
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 Performance Mergers 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, Performance Mergers can use these opportunities to build new business models that can help the communities that Performance Mergers operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Creating value in data economy
– The success of analytics program of Performance Mergers has opened avenues for new revenue streams for the organization in the industry. This can help Performance Mergers to build a more holistic ecosystem as suggested in the The role of information technology systems in the performance of mergers and acquisitions case study. Performance Mergers 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 Performance Mergers 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 Performance Mergers to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Performance Mergers 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.
Better consumer reach
– The expansion of the 5G network will help Performance Mergers to increase its market reach. Performance Mergers 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.
Developing new processes and practices
– Performance Mergers 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.
Using analytics as competitive advantage
– Performance Mergers 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 The role of information technology systems in the performance of mergers and acquisitions - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Performance Mergers to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Performance Mergers can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The role of information technology systems in the performance of mergers and acquisitions 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.
Threats The role of information technology systems in the performance of mergers and acquisitions External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The role of information technology systems in the performance of mergers and acquisitions are -
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. Performance Mergers needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Performance Mergers 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Performance Mergers 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.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Performance Mergers with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Performance Mergers
– 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 Performance Mergers.
Regulatory challenges
– Performance Mergers 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.
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 Performance Mergers.
Environmental challenges
– Performance Mergers 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. Performance Mergers can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The role of information technology systems in the performance of mergers and acquisitions, Performance Mergers 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 .
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. Performance Mergers 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Performance Mergers 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 The role of information technology systems in the performance of mergers and acquisitions .
Weighted SWOT Analysis of The role of information technology systems in the performance of mergers and acquisitions 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 The role of information technology systems in the performance of mergers and acquisitions 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 The role of information technology systems in the performance of mergers and acquisitions 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 The role of information technology systems in the performance of mergers and acquisitions 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 The role of information technology systems in the performance of mergers and acquisitions 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 Performance Mergers needs to make to build a sustainable competitive advantage.
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