Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy
Does too much competition in banking hurt society? What policies can best protect and stabilize banking without stifling it? This article addresses the critical relationships between competition, regulation and stability, and the implications of coordinating banking regulations with competition policies. The author presents some key challenges that bankers and regulators face in trying to manage the trade-offs between competition and stability. He also derives some important policy implications for both public- and private-sector actors, so that society can reap the genuine benefits of competition: efficiency, innovation, growth and consumer welfare, in order to build trust in the banking sector again.
Swot Analysis of "Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy" written by Xavier Vives includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Competition Stability facing as an external strategic factors. Some of the topics covered in Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy case study are - Strategic Management Strategies, Financial management and Global Business.
Some of the macro environment factors that can be used to understand the Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy casestudy better are - – central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, there is backlash against globalization, technology disruption, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%,
increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Competition Stability, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Competition Stability 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy can be done for the following purposes –
1. Strategic planning using facts provided in Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy case study
2. Improving business portfolio management of Competition Stability
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Competition Stability
Strengths Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Competition Stability in Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy Harvard Business Review case study are -
Sustainable margins compare to other players in Global Business industry
– Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy firm has clearly differentiated products in the market place. This has enabled Competition Stability to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Competition Stability to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Low bargaining power of suppliers
– Suppliers of Competition Stability in the sector have low bargaining power. Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Competition Stability to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Competition Stability 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.
Innovation driven organization
– Competition Stability is one of the most innovative firm in sector. Manager in Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Competition Stability 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Competition Stability digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Competition Stability has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Ability to recruit top talent
– Competition Stability is one of the leading recruiters in the industry. Managers in the Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Competition Stability has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Competition Stability to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Competition Stability has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Competition Stability 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 lead change in Global Business field
– Competition Stability 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 Competition Stability in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Competition Stability has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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.
Weaknesses Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy are -
Need for greater diversity
– Competition Stability has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy, is just above the industry average. Competition Stability 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.
Lack of clear differentiation of Competition Stability products
– To increase the profitability and margins on the products, Competition Stability needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy, it seems that the employees of Competition Stability 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy, in the dynamic environment Competition Stability has struggled to respond to the nimble upstart competition. Competition Stability has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Xavier Vives suggests that, Competition Stability 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.
Low market penetration in new markets
– Outside its home market of Competition Stability, firm in the HBR case study Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Competition Stability 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.
Increasing silos among functional specialists
– The organizational structure of Competition Stability is dominated by functional specialists. It is not different from other players in the Global Business segment. Competition Stability needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Competition Stability to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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 Competition Stability has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy can leverage the sales team experience to cultivate customer relationships as Competition Stability is planning to shift buying processes online.
Opportunities Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy | 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy are -
Buying journey improvements
– Competition Stability can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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.
Creating value in data economy
– The success of analytics program of Competition Stability has opened avenues for new revenue streams for the organization in the industry. This can help Competition Stability to build a more holistic ecosystem as suggested in the Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy case study. Competition Stability can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Competition Stability can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Competition Stability 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Competition Stability 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 Competition Stability to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Competition Stability 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. Competition Stability 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.
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 Competition Stability 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Competition Stability in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Competition Stability 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Competition Stability to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Competition Stability is facing challenges because of the dominance of functional experts in the organization. Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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.
Leveraging digital technologies
– Competition Stability 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.
Developing new processes and practices
– Competition Stability can develop new processes and procedures in Global Business 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 Competition Stability 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 Global Business segment.
Threats Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Competition Stability in the Global Business industry. The Global Business 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.
Increasing wage structure of Competition Stability
– 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 Competition Stability.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Competition Stability 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy .
Technology acceleration in Forth Industrial Revolution
– Competition Stability has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Competition Stability needs to keep up with the evolution of technology in the Global Business 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.
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.
Environmental challenges
– Competition Stability 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. Competition Stability can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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. Competition Stability 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.
Stagnating economy with rate increase
– Competition Stability 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Competition Stability with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Competition Stability 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.
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 Competition Stability business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Competition Stability 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 Competition Stability in the Global Business sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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 Balancing the Trade-Offs Between Competition and Stability: Private Banks & Public Policy 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 Competition Stability needs to make to build a sustainable competitive advantage.
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