Deloitte and KPMG: The War for Talent SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Deloitte and KPMG: The War for Talent
In 2016, India witnessed an intense war for talent acquisition in consulting when Deloitte Touche Tohmatsu India LLP (Deloitte) poached 20 partners and their teams-around 300 people in total-from KPMG India (KPMG). Deloitte offered a higher compensation to attract KPMG executives and lured partners with a salary jump in proportion to the number of team members they could bring from KPMG. The rivalry between the firms was fuelled by their desire to challenge Ernst & Young Global Limited, the market leader, which had 125 partners in its advisory vertical. This was the biggest poaching attempt in the industry since 2011 and the third time in the span of a year that KPMG partners had quit to join rival companies. For KPMG, it was a big blow, as the company lost many partners from the vertical that was leading its growth globally. KPMG management was now confronted with the challenge of defending against any such future poaching attempts by its competitors and retaining existing employees. The firm needed to engage its existing employees and boost their motivation to avoid further damage. The authors Sanjeev Prashar and Mukesh Kuma affiliated with Indian Institute of Management Raipur. Amitabh Deo Kodwani is affiliated with Indian Institute of Management Indore.
Authors :: Sanjeev Prashar, Amitabh Deo Kodwani, Mukesh Kumar
Swot Analysis of "Deloitte and KPMG: The War for Talent" written by Sanjeev Prashar, Amitabh Deo Kodwani, Mukesh Kumar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Kpmg Deloitte facing as an external strategic factors. Some of the topics covered in Deloitte and KPMG: The War for Talent case study are - Strategic Management Strategies, Motivating people, Talent management and Organizational Development.
Some of the macro environment factors that can be used to understand the Deloitte and KPMG: The War for Talent casestudy better are - – increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, technology disruption, increasing transportation and logistics costs, geopolitical disruptions,
increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Deloitte and KPMG: The War for Talent
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Deloitte and KPMG: The War for Talent case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Kpmg Deloitte, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Kpmg Deloitte 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 Deloitte and KPMG: The War for Talent can be done for the following purposes –
1. Strategic planning using facts provided in Deloitte and KPMG: The War for Talent case study
2. Improving business portfolio management of Kpmg Deloitte
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Kpmg Deloitte
Strengths Deloitte and KPMG: The War for Talent | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Kpmg Deloitte in Deloitte and KPMG: The War for Talent Harvard Business Review case study are -
Analytics focus
– Kpmg Deloitte 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 Sanjeev Prashar, Amitabh Deo Kodwani, Mukesh Kumar 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.
Sustainable margins compare to other players in Organizational Development industry
– Deloitte and KPMG: The War for Talent firm has clearly differentiated products in the market place. This has enabled Kpmg Deloitte to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Kpmg Deloitte to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Kpmg Deloitte is present in almost all the verticals within the industry. This has provided firm in Deloitte and KPMG: The War for Talent 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.
Organizational Resilience of Kpmg Deloitte
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Kpmg Deloitte does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Kpmg Deloitte is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Kpmg Deloitte in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Kpmg Deloitte 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 Deloitte and KPMG: The War for Talent 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 Kpmg Deloitte 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.
Successful track record of launching new products
– Kpmg Deloitte has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Kpmg Deloitte has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High switching costs
– The high switching costs that Kpmg Deloitte 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.
Low bargaining power of suppliers
– Suppliers of Kpmg Deloitte in the sector have low bargaining power. Deloitte and KPMG: The War for Talent has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Kpmg Deloitte to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Kpmg Deloitte is one of the most innovative firm in sector. Manager in Deloitte and KPMG: The War for Talent Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Deloitte and KPMG: The War for Talent | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Deloitte and KPMG: The War for Talent are -
High bargaining power of channel partners
– Because of the regulatory requirements, Sanjeev Prashar, Amitabh Deo Kodwani, Mukesh Kumar suggests that, Kpmg Deloitte 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.
Increasing silos among functional specialists
– The organizational structure of Kpmg Deloitte is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Kpmg Deloitte needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Kpmg Deloitte to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Deloitte and KPMG: The War for Talent, in the dynamic environment Kpmg Deloitte has struggled to respond to the nimble upstart competition. Kpmg Deloitte has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Kpmg Deloitte 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. Kpmg Deloitte 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.
Interest costs
– Compare to the competition, Kpmg Deloitte 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
Kpmg Deloitte 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.
Products dominated business model
– Even though Kpmg Deloitte 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 - Deloitte and KPMG: The War for Talent should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study Deloitte and KPMG: The War for Talent 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 Kpmg Deloitte 's lucrative customers.
Lack of clear differentiation of Kpmg Deloitte products
– To increase the profitability and margins on the products, Kpmg Deloitte needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Deloitte and KPMG: The War for Talent, is just above the industry average. Kpmg Deloitte 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Kpmg Deloitte is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Deloitte and KPMG: The War for Talent can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Deloitte and KPMG: The War for Talent | 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 Deloitte and KPMG: The War for Talent are -
Loyalty marketing
– Kpmg Deloitte 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.
Building a culture of innovation
– managers at Kpmg Deloitte 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 Organizational Development segment.
Low interest rates
– Even though inflation is raising its head in most developed economies, Kpmg Deloitte 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.
Creating value in data economy
– The success of analytics program of Kpmg Deloitte has opened avenues for new revenue streams for the organization in the industry. This can help Kpmg Deloitte to build a more holistic ecosystem as suggested in the Deloitte and KPMG: The War for Talent case study. Kpmg Deloitte can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Kpmg Deloitte 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, Deloitte and KPMG: The War for Talent, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Kpmg Deloitte can use these opportunities to build new business models that can help the communities that Kpmg Deloitte operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Kpmg Deloitte in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
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 Kpmg Deloitte 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.
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. Kpmg Deloitte can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Kpmg Deloitte can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Deloitte and KPMG: The War for Talent 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Kpmg Deloitte 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. Kpmg Deloitte 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.
Using analytics as competitive advantage
– Kpmg Deloitte 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 Deloitte and KPMG: The War for Talent - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Kpmg Deloitte to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Kpmg Deloitte can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Deloitte and KPMG: The War for Talent External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Deloitte and KPMG: The War for Talent are -
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.
Regulatory challenges
– Kpmg Deloitte 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 Organizational Development industry regulations.
Consumer confidence and its impact on Kpmg Deloitte 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
– Kpmg Deloitte 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.
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.
High dependence on third party suppliers
– Kpmg Deloitte 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Kpmg Deloitte 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 Deloitte and KPMG: The War for Talent .
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 Kpmg Deloitte.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Kpmg Deloitte 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 Kpmg Deloitte in the Organizational Development sector and impact the bottomline of the organization.
Environmental challenges
– Kpmg Deloitte 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. Kpmg Deloitte can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Increasing wage structure of Kpmg Deloitte
– 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 Kpmg Deloitte.
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 Kpmg Deloitte business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Deloitte and KPMG: The War for Talent 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 Deloitte and KPMG: The War for Talent 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 Deloitte and KPMG: The War for Talent 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 Deloitte and KPMG: The War for Talent 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 Deloitte and KPMG: The War for Talent 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 Kpmg Deloitte needs to make to build a sustainable competitive advantage.
