The Trouble With Corporate Compliance Programs SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Trouble With Corporate Compliance Programs
Multinational corporations spend millions of dollars per year on compliance. In highly regulated industries, such as health care and finance, large companies spend much more, sometimes hiring hundreds or even thousands of compliance officers at a time. There is often a belief on the part of corporate leaders that when rigorous compliance programs are in place, employee wrongdoing will largely disappear.If something does go wrong, the hope is that having a comprehensive program will help convince regulators that the company's compliance initiatives were "effective,"the standard used in U.S. sentencing guidelines. Unfortunately, even today's most comprehensive programs won't curtail corporate wrongdoing or the government intervention that follows. Volkswagen AG's compliance program didn't stop its employees from installing "defeat device"software to cheat emissions tests, nor did Wells Fargo & Co.'s policies prevent its employees from opening new customer accounts without authorization. More than 15 years after the Enron Corp. scandal, most companies know very little about how employees make ethical decisions or the psychological mechanisms that cause them to perform unethical and illegal acts. Even fewer have compliance strategies aimed at curbing such behaviors. The goal of this article is to pull together the burgeoning field of behavioral ethics, which provides insight into how individuals make ethical decisions, with the work of criminologists who study individual and corporate criminality. The author seeks to explain why corporate compliance efforts are falling short and how those efforts can be improved. In addition, he offers practical and cost-effective strategies for improving compliance programs that focus on employee behavior, which he says is the best way to make compliance truly effective. Corporate compliance depends on the behavior of individual employees. If employees, officers, and managers always acted in a law-abiding and ethical manner, compliance failures would rarely occur. But that is not realistic. That is why companies need to be aware of how and why employees act the way they do. This starts with understanding how people make decisions generally and how that translates to ethical decision-making. The article describes eight common rationalizations used by those committing unethical and illegal acts within companies. Corporate leaders need to understand these rationalizations and be able to identify their usage as part of an effective compliance program. The author acknowledges that no compliance program will entirely eliminate bad employee conduct. But behaviorally cognizant programs, ones that seek to understand employee decision-making and target the cognitive mechanisms that foster unethicality, hold the promise of reducing unethical and illegal behavior within a company.
Swot Analysis of "The Trouble With Corporate Compliance Programs" written by Todd Haugh includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Compliance Unethical facing as an external strategic factors. Some of the topics covered in The Trouble With Corporate Compliance Programs case study are - Strategic Management Strategies, and Organizational Development.
Some of the macro environment factors that can be used to understand the The Trouble With Corporate Compliance Programs casestudy better are - – challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, there is backlash against globalization, technology disruption,
wage bills are increasing, increasing energy prices, etc
Introduction to SWOT Analysis of The Trouble With Corporate Compliance Programs
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Trouble With Corporate Compliance Programs case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Compliance Unethical, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Compliance Unethical 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 Trouble With Corporate Compliance Programs can be done for the following purposes –
1. Strategic planning using facts provided in The Trouble With Corporate Compliance Programs case study
2. Improving business portfolio management of Compliance Unethical
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 Compliance Unethical
Strengths The Trouble With Corporate Compliance Programs | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Compliance Unethical in The Trouble With Corporate Compliance Programs Harvard Business Review case study are -
Sustainable margins compare to other players in Organizational Development industry
– The Trouble With Corporate Compliance Programs firm has clearly differentiated products in the market place. This has enabled Compliance Unethical to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Compliance Unethical to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Compliance Unethical 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.
Effective Research and Development (R&D)
– Compliance Unethical 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 Trouble With Corporate Compliance Programs - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Compliance Unethical 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
– Compliance Unethical has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Compliance Unethical 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.
Organizational Resilience of Compliance Unethical
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Compliance Unethical does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Compliance Unethical in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Compliance Unethical is one of the most innovative firm in sector. Manager in The Trouble With Corporate Compliance Programs Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Compliance Unethical 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 Compliance Unethical is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Trouble With Corporate Compliance Programs Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Compliance Unethical 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 Trouble With Corporate Compliance Programs HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Compliance Unethical 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 Todd Haugh 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.
Operational resilience
– The operational resilience strategy in the The Trouble With Corporate Compliance Programs 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.
Weaknesses The Trouble With Corporate Compliance Programs | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Trouble With Corporate Compliance Programs are -
High bargaining power of channel partners
– Because of the regulatory requirements, Todd Haugh suggests that, Compliance Unethical 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Trouble With Corporate Compliance Programs, in the dynamic environment Compliance Unethical has struggled to respond to the nimble upstart competition. Compliance Unethical has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Compliance Unethical, firm in the HBR case study The Trouble With Corporate Compliance Programs needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Compliance Unethical needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Compliance Unethical supply chain. Even after few cautionary changes mentioned in the HBR case study - The Trouble With Corporate Compliance Programs, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Compliance Unethical vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Compliance Unethical 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Compliance Unethical is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Trouble With Corporate Compliance Programs can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Compliance Unethical 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Trouble With Corporate Compliance Programs, it seems that the employees of Compliance Unethical 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.
Need for greater diversity
– Compliance Unethical 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.
Increasing silos among functional specialists
– The organizational structure of Compliance Unethical is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Compliance Unethical needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Compliance Unethical to focus more on services rather than just following the product oriented approach.
Opportunities The Trouble With Corporate Compliance Programs | 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 Trouble With Corporate Compliance Programs are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Compliance Unethical can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Compliance Unethical 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.
Manufacturing automation
– Compliance Unethical can use the latest technology developments to improve its manufacturing and designing process in Organizational Development 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.
Learning at scale
– Online learning technologies has now opened space for Compliance Unethical to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Low interest rates
– Even though inflation is raising its head in most developed economies, Compliance Unethical 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.
Better consumer reach
– The expansion of the 5G network will help Compliance Unethical to increase its market reach. Compliance Unethical 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Compliance Unethical can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Compliance Unethical 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. Compliance Unethical 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.
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. Compliance Unethical can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Compliance Unethical can use these opportunities to build new business models that can help the communities that Compliance Unethical operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
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 Compliance Unethical 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.
Leveraging digital technologies
– Compliance Unethical 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.
Buying journey improvements
– Compliance Unethical can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Trouble With Corporate Compliance Programs suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Threats The Trouble With Corporate Compliance Programs External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Trouble With Corporate Compliance Programs 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 Compliance Unethical business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Compliance Unethical is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Compliance Unethical
– 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 Compliance Unethical.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Compliance Unethical in the Organizational Development industry. The Organizational Development 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.
Consumer confidence and its impact on Compliance Unethical 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.
High dependence on third party suppliers
– Compliance Unethical 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.
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.
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. Compliance Unethical needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Compliance Unethical can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study The Trouble With Corporate Compliance Programs .
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 Compliance Unethical.
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. Compliance Unethical can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Compliance Unethical 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. Compliance Unethical can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Regulatory challenges
– Compliance Unethical 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.
Weighted SWOT Analysis of The Trouble With Corporate Compliance Programs 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 Trouble With Corporate Compliance Programs 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 Trouble With Corporate Compliance Programs 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 Trouble With Corporate Compliance Programs 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 Trouble With Corporate Compliance Programs 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 Compliance Unethical needs to make to build a sustainable competitive advantage.