Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate
In early December 2013, Roxann Biller, Associate at the Chicago-based private equity firm Delta Quantitative Real Estate Capital, was asked to assess the risk associated with the firm's first potential overseas investment. Haifu Sent? Gendaino (HSG) was a large multi-tenant logistics property located in the Gaikando area of Tokyo. High-quality tenants currently occupied the property, so at first glance the risks of investing in the property seemed minimal. However, Biller knew that she had to consider the potential drawbacks. This would mean gaining a better understanding of each tenant, trying to forecast the future condition of the Tokyo logistics market, and considering what new risks her firm would face because the property's cash flows were in a foreign currency.
Swot Analysis of "Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate" written by Craig Furfine includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Biller Tenant facing as an external strategic factors. Some of the topics covered in Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate case study are - Strategic Management Strategies, Forecasting, Risk management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate casestudy better are - – wage bills are increasing, increasing energy prices, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, talent flight as more people leaving formal jobs, central banks are concerned over increasing inflation,
challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Biller Tenant, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Biller Tenant 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate can be done for the following purposes –
1. Strategic planning using facts provided in Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate case study
2. Improving business portfolio management of Biller Tenant
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 Biller Tenant
Strengths Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Biller Tenant in Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate Harvard Business Review case study are -
Effective Research and Development (R&D)
– Biller Tenant 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Biller Tenant has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Biller Tenant 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.
Analytics focus
– Biller Tenant 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 Craig Furfine 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
– Biller Tenant 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Biller Tenant has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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.
Ability to lead change in Finance & Accounting field
– Biller Tenant 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 Biller Tenant in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Biller Tenant in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Biller Tenant is one of the leading recruiters in the industry. Managers in the Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Biller Tenant digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Biller Tenant 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.
Cross disciplinary teams
– Horizontal connected teams at the Biller Tenant 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.
Organizational Resilience of Biller Tenant
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Biller Tenant does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Biller Tenant is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate are -
Aligning sales with marketing
– It come across in the case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate can leverage the sales team experience to cultivate customer relationships as Biller Tenant is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate, in the dynamic environment Biller Tenant has struggled to respond to the nimble upstart competition. Biller Tenant has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Biller Tenant products
– To increase the profitability and margins on the products, Biller Tenant needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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 Biller Tenant 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Biller Tenant 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.
Low market penetration in new markets
– Outside its home market of Biller Tenant, firm in the HBR case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Craig Furfine suggests that, Biller Tenant 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.
No frontier risks strategy
– After analyzing the HBR case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate, it seems that company is thinking about the frontier risks that can impact Finance & Accounting strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Biller Tenant is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate, it seems that the employees of Biller Tenant 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.
High cash cycle compare to competitors
Biller Tenant 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.
Opportunities Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate | 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Biller Tenant is facing challenges because of the dominance of functional experts in the organization. Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Biller Tenant 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.
Developing new processes and practices
– Biller Tenant can develop new processes and procedures in Finance & Accounting industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Buying journey improvements
– Biller Tenant can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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.
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 Biller Tenant 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, Biller Tenant can use these opportunities to build new business models that can help the communities that Biller Tenant operates in. Secondly it can use opportunities from government spending in Finance & Accounting 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. Biller Tenant can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Biller Tenant can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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 Biller Tenant has opened avenues for new revenue streams for the organization in the industry. This can help Biller Tenant to build a more holistic ecosystem as suggested in the Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate case study. Biller Tenant can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Biller Tenant 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.
Leveraging digital technologies
– Biller Tenant can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Better consumer reach
– The expansion of the 5G network will help Biller Tenant to increase its market reach. Biller Tenant 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Biller Tenant 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, Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate, 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate are -
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 Biller Tenant.
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 Biller Tenant business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Biller Tenant with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Biller Tenant needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Regulatory challenges
– Biller Tenant needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Finance & Accounting industry regulations.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate, Biller Tenant 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Biller Tenant 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate .
Increasing wage structure of Biller Tenant
– 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 Biller Tenant.
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. Biller Tenant 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 Biller Tenant in the Finance & Accounting sector and impact the bottomline 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.
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.
Technology acceleration in Forth Industrial Revolution
– Biller Tenant has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Biller Tenant needs to keep up with the evolution of technology in the Finance & Accounting 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.
Weighted SWOT Analysis of Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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 Expect the Unexpected: Risk Measurement and Management in Commercial Real Estate 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 Biller Tenant needs to make to build a sustainable competitive advantage.
