Case Study Description of Sabana REIT: Activist Retail Investors Rebel
Rafi, a retiring oncologist, wanted to invest in safe, high dividend paying stocks. Upon his stockbroker's recommendation, he bought three tranches of S$500,000 worth of Sabana REIT ("Sabana") even as price fell during the period in between. His stockbroker had advised him to adopt dollar cost averaging, as even if price fell, Rafi could lower his breakeven price and gain in the longer term as stock prices tend to mean-revert. Further, Sabana's high dividend yield would help offset the price fall. Six months later, Sabana's price fell further. Rafi sought the advice of Michael, an investment-savvy friend, who advised him to look at capital gain yield besides dividend yield, and to check out Sabana's website and various investment forums for important company's actions and other crucial information. Rafi found that disgruntled investors, unhappy with Sabana's falling dividend and price, had formed two groups, one of whom had proposed various drastic actions at an Extraordinary General Meeting which may involve booting the REIT manager, and/or delisting the REIT and liquidating its portfolio. The manager formed a Strategic Review Committee and requested for more time. Rafi had to decide: vote for or against the manager or just cut loss immediately.
Swot Analysis of "Sabana REIT: Activist Retail Investors Rebel" written by Yoon Kee Kong includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Rafi Sabana's facing as an external strategic factors. Some of the topics covered in Sabana REIT: Activist Retail Investors Rebel case study are - Strategic Management Strategies, Corporate governance, Financial markets and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Sabana REIT: Activist Retail Investors Rebel casestudy better are - – increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic ,
increasing inequality as vast percentage of new income is going to the top 1%, geopolitical disruptions, etc
Introduction to SWOT Analysis of Sabana REIT: Activist Retail Investors Rebel
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Sabana REIT: Activist Retail Investors Rebel case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Rafi Sabana's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Rafi Sabana's 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 Sabana REIT: Activist Retail Investors Rebel can be done for the following purposes –
1. Strategic planning using facts provided in Sabana REIT: Activist Retail Investors Rebel case study
2. Improving business portfolio management of Rafi Sabana's
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 Rafi Sabana's
Strengths Sabana REIT: Activist Retail Investors Rebel | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Rafi Sabana's in Sabana REIT: Activist Retail Investors Rebel Harvard Business Review case study are -
Successful track record of launching new products
– Rafi Sabana's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Rafi Sabana's 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.
Highly skilled collaborators
– Rafi Sabana's 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 Sabana REIT: Activist Retail Investors Rebel HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Rafi Sabana's is one of the most innovative firm in sector. Manager in Sabana REIT: Activist Retail Investors Rebel Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Rafi Sabana's is present in almost all the verticals within the industry. This has provided firm in Sabana REIT: Activist Retail Investors Rebel 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.
High brand equity
– Rafi Sabana's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Rafi Sabana's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Rafi Sabana's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the Sabana REIT: Activist Retail Investors Rebel 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 Rafi Sabana's in the sector have low bargaining power. Sabana REIT: Activist Retail Investors Rebel has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Rafi Sabana's to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Rafi Sabana's 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 Yoon Kee Kong 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 Finance & Accounting industry
– Sabana REIT: Activist Retail Investors Rebel firm has clearly differentiated products in the market place. This has enabled Rafi Sabana's to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Rafi Sabana's to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Rafi Sabana's 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.
Cross disciplinary teams
– Horizontal connected teams at the Rafi Sabana's 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.
Weaknesses Sabana REIT: Activist Retail Investors Rebel | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sabana REIT: Activist Retail Investors Rebel are -
High cash cycle compare to competitors
Rafi Sabana's 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.
Slow decision making process
– As mentioned earlier in the report, Rafi Sabana's 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. Rafi Sabana's 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.
Aligning sales with marketing
– It come across in the case study Sabana REIT: Activist Retail Investors Rebel 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 Sabana REIT: Activist Retail Investors Rebel can leverage the sales team experience to cultivate customer relationships as Rafi Sabana's is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study Sabana REIT: Activist Retail Investors Rebel, 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.
Skills based hiring
– The stress on hiring functional specialists at Rafi Sabana's has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Rafi Sabana's 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Rafi Sabana's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Sabana REIT: Activist Retail Investors Rebel 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 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 Rafi Sabana's supply chain. Even after few cautionary changes mentioned in the HBR case study - Sabana REIT: Activist Retail Investors Rebel, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Rafi Sabana's vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Rafi Sabana's 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.
Capital Spending Reduction
– Even during the low interest decade, Rafi Sabana's has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High bargaining power of channel partners
– Because of the regulatory requirements, Yoon Kee Kong suggests that, Rafi Sabana's 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.
Opportunities Sabana REIT: Activist Retail Investors Rebel | 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 Sabana REIT: Activist Retail Investors Rebel are -
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. Rafi Sabana's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Rafi Sabana's 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Rafi Sabana's 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, Sabana REIT: Activist Retail Investors Rebel, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Rafi Sabana's 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
– Rafi Sabana's 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 Sabana REIT: Activist Retail Investors Rebel - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Rafi Sabana's 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 Rafi Sabana's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Rafi Sabana's 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.
Manufacturing automation
– Rafi Sabana's 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.
Loyalty marketing
– Rafi Sabana's 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Rafi Sabana's can use these opportunities to build new business models that can help the communities that Rafi Sabana's operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Building a culture of innovation
– managers at Rafi Sabana's 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Rafi Sabana's 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 Rafi Sabana's to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Rafi Sabana's 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.
Threats Sabana REIT: Activist Retail Investors Rebel External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Sabana REIT: Activist Retail Investors Rebel are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Rafi Sabana's 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 Rafi Sabana's 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.
Regulatory challenges
– Rafi Sabana's 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Rafi Sabana's 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 Sabana REIT: Activist Retail Investors Rebel .
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 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. Rafi Sabana's needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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.
Shortening product life cycle
– it is one of the major threat that Rafi Sabana's is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Sabana REIT: Activist Retail Investors Rebel, Rafi Sabana's 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Rafi Sabana's 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.
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 Rafi Sabana's.
Stagnating economy with rate increase
– Rafi Sabana's 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.
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. Rafi Sabana's 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.
Weighted SWOT Analysis of Sabana REIT: Activist Retail Investors Rebel 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 Sabana REIT: Activist Retail Investors Rebel 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 Sabana REIT: Activist Retail Investors Rebel 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 Sabana REIT: Activist Retail Investors Rebel 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 Sabana REIT: Activist Retail Investors Rebel 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 Rafi Sabana's needs to make to build a sustainable competitive advantage.