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 inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, increasing commodity prices, technology disruption, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion,
wage bills are increasing, challanges to central banks by blockchain based private currencies, 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 -
Learning organization
- Rafi Sabana's 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 Rafi Sabana's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Sabana REIT: Activist Retail Investors Rebel Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
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.
Ability to recruit top talent
– Rafi Sabana's is one of the leading recruiters in the industry. Managers in the Sabana REIT: Activist Retail Investors Rebel are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Rafi Sabana's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Sabana REIT: Activist Retail Investors Rebel 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.
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.
Ability to lead change in Finance & Accounting field
– Rafi Sabana's 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 Rafi Sabana's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
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.
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.
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.
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.
Effective Research and Development (R&D)
– Rafi Sabana's 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 Sabana REIT: Activist Retail Investors Rebel - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
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.
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 -
Products dominated business model
– Even though Rafi Sabana's 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 - Sabana REIT: Activist Retail Investors Rebel should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Sabana REIT: Activist Retail Investors Rebel HBR case study mentions - Rafi Sabana's takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Sabana REIT: Activist Retail Investors Rebel, is just above the industry average. Rafi Sabana's 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.
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.
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.
Need for greater diversity
– Rafi Sabana's 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.
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.
Low market penetration in new markets
– Outside its home market of Rafi Sabana's, firm in the HBR case study Sabana REIT: Activist Retail Investors Rebel needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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.
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.
High operating costs
– Compare to the competitors, firm in the HBR case study Sabana REIT: Activist Retail Investors Rebel 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 Rafi Sabana's 's lucrative customers.
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 -
Buying journey improvements
– Rafi Sabana's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Sabana REIT: Activist Retail Investors Rebel 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.
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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Rafi Sabana's in the consumer business. Now Rafi Sabana's can target international markets with far fewer capital restrictions requirements than the existing system.
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.
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.
Creating value in data economy
– The success of analytics program of Rafi Sabana's has opened avenues for new revenue streams for the organization in the industry. This can help Rafi Sabana's to build a more holistic ecosystem as suggested in the Sabana REIT: Activist Retail Investors Rebel case study. Rafi Sabana's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Rafi Sabana's 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Rafi Sabana's 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. Rafi Sabana's 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.
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.
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.
Better consumer reach
– The expansion of the 5G network will help Rafi Sabana's to increase its market reach. Rafi Sabana's 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.
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.
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.
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 -
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.
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.
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.
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 .
Environmental challenges
– Rafi Sabana's 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. Rafi Sabana's can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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 Rafi Sabana's in the Finance & Accounting sector and impact the bottomline of the organization.
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.
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 .
High dependence on third party suppliers
– Rafi Sabana's 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. Rafi Sabana's needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Increasing wage structure of Rafi Sabana's
– 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 Rafi Sabana's.
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.
