The Canada Pension Plan Investment Board: October 2012 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Canada Pension Plan Investment Board: October 2012
The Canada Pension Plan Investment Board (CPPIB) is one of the largest and fastest-growing pools of investment capital in the world and follows an unusually active program of investment management. In October of 2012, Mark Wiseman was just 12 weeks into his role as chief executive officer, and he must decide how to lead the organization to outperform the market as it grows larger and more geographically disperse. After seven years of eschewing the use of intermediaries and successfully practicing its "do-it-yourself mega-investing" approach, CPPIB had garnered admiration from institutions on Bay Street and Wall Street alike. It had even been heralded as a "Maple Revolutionary" by The Economist. With assets under management projected to grow to C$275 billion by 2020, however, Wiseman faced the challenge of how to scale the organization's investment strategy for the future. As Wiseman settled into the chief executive's role, would he be able to lead CPPIB to meet its goals?
Authors :: Josh Lerner, Matthew Rhodes-Kropf, Nathaniel Burbank
Swot Analysis of "The Canada Pension Plan Investment Board: October 2012" written by Josh Lerner, Matthew Rhodes-Kropf, Nathaniel Burbank includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Wiseman Cppib facing as an external strategic factors. Some of the topics covered in The Canada Pension Plan Investment Board: October 2012 case study are - Strategic Management Strategies, Financial management, Marketing and Finance & Accounting.
Some of the macro environment factors that can be used to understand the The Canada Pension Plan Investment Board: October 2012 casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, geopolitical disruptions, increasing energy prices, wage bills are increasing, talent flight as more people leaving formal jobs, increasing commodity prices,
supply chains are disrupted by pandemic , increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of The Canada Pension Plan Investment Board: October 2012
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Canada Pension Plan Investment Board: October 2012 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Wiseman Cppib, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Wiseman Cppib 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 Canada Pension Plan Investment Board: October 2012 can be done for the following purposes –
1. Strategic planning using facts provided in The Canada Pension Plan Investment Board: October 2012 case study
2. Improving business portfolio management of Wiseman Cppib
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 Wiseman Cppib
Strengths The Canada Pension Plan Investment Board: October 2012 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Wiseman Cppib in The Canada Pension Plan Investment Board: October 2012 Harvard Business Review case study are -
Successful track record of launching new products
– Wiseman Cppib has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Wiseman Cppib 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.
Superior customer experience
– The customer experience strategy of Wiseman Cppib in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Wiseman Cppib is present in almost all the verticals within the industry. This has provided firm in The Canada Pension Plan Investment Board: October 2012 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.
Highly skilled collaborators
– Wiseman Cppib 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 Canada Pension Plan Investment Board: October 2012 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Wiseman Cppib 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.
Ability to recruit top talent
– Wiseman Cppib is one of the leading recruiters in the industry. Managers in the The Canada Pension Plan Investment Board: October 2012 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Learning organization
- Wiseman Cppib 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 Wiseman Cppib is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Canada Pension Plan Investment Board: October 2012 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Wiseman Cppib has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Canada Pension Plan Investment Board: October 2012 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Wiseman Cppib digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Wiseman Cppib 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.
Effective Research and Development (R&D)
– Wiseman Cppib 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 Canada Pension Plan Investment Board: October 2012 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Wiseman Cppib in the sector have low bargaining power. The Canada Pension Plan Investment Board: October 2012 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Wiseman Cppib to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Finance & Accounting industry
– The Canada Pension Plan Investment Board: October 2012 firm has clearly differentiated products in the market place. This has enabled Wiseman Cppib to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Wiseman Cppib to invest into research and development (R&D) and innovation.
Weaknesses The Canada Pension Plan Investment Board: October 2012 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Canada Pension Plan Investment Board: October 2012 are -
Interest costs
– Compare to the competition, Wiseman Cppib 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.
High cash cycle compare to competitors
Wiseman Cppib 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 Wiseman Cppib, firm in the HBR case study The Canada Pension Plan Investment Board: October 2012 needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As The Canada Pension Plan Investment Board: October 2012 HBR case study mentions - Wiseman Cppib 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Canada Pension Plan Investment Board: October 2012, in the dynamic environment Wiseman Cppib has struggled to respond to the nimble upstart competition. Wiseman Cppib 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 Wiseman Cppib products
– To increase the profitability and margins on the products, Wiseman Cppib needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study The Canada Pension Plan Investment Board: October 2012 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 The Canada Pension Plan Investment Board: October 2012 can leverage the sales team experience to cultivate customer relationships as Wiseman Cppib is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study The Canada Pension Plan Investment Board: October 2012 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 Wiseman Cppib 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study The Canada Pension Plan Investment Board: October 2012, 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Canada Pension Plan Investment Board: October 2012 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 Wiseman Cppib has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Wiseman Cppib is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Wiseman Cppib needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Wiseman Cppib to focus more on services rather than just following the product oriented approach.
Opportunities The Canada Pension Plan Investment Board: October 2012 | 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 Canada Pension Plan Investment Board: October 2012 are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Wiseman Cppib can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Wiseman Cppib 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 Wiseman Cppib in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Wiseman Cppib 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 Canada Pension Plan Investment Board: October 2012 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Wiseman Cppib to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Wiseman Cppib 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Wiseman Cppib 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 Wiseman Cppib to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Wiseman Cppib 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.
Building a culture of innovation
– managers at Wiseman Cppib can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Buying journey improvements
– Wiseman Cppib can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Canada Pension Plan Investment Board: October 2012 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 Wiseman Cppib 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.
Creating value in data economy
– The success of analytics program of Wiseman Cppib has opened avenues for new revenue streams for the organization in the industry. This can help Wiseman Cppib to build a more holistic ecosystem as suggested in the The Canada Pension Plan Investment Board: October 2012 case study. Wiseman Cppib can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Wiseman Cppib is facing challenges because of the dominance of functional experts in the organization. The Canada Pension Plan Investment Board: October 2012 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Wiseman Cppib 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. Wiseman Cppib 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.
Threats The Canada Pension Plan Investment Board: October 2012 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Canada Pension Plan Investment Board: October 2012 are -
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 Wiseman Cppib business can come under increasing regulations regarding data privacy, data security, etc.
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 Wiseman Cppib in the Finance & Accounting sector and impact the bottomline of the organization.
Regulatory challenges
– Wiseman Cppib 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.
Environmental challenges
– Wiseman Cppib 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. Wiseman Cppib can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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.
Shortening product life cycle
– it is one of the major threat that Wiseman Cppib is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Wiseman Cppib in the Finance & Accounting industry. The Finance & Accounting 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.
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. Wiseman Cppib 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.
Consumer confidence and its impact on Wiseman Cppib 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Wiseman Cppib with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Wiseman Cppib can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Canada Pension Plan Investment Board: October 2012, Wiseman Cppib 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 .
Stagnating economy with rate increase
– Wiseman Cppib 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 The Canada Pension Plan Investment Board: October 2012 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 Canada Pension Plan Investment Board: October 2012 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 Canada Pension Plan Investment Board: October 2012 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 Canada Pension Plan Investment Board: October 2012 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 Canada Pension Plan Investment Board: October 2012 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 Wiseman Cppib needs to make to build a sustainable competitive advantage.
