Impact Investing: The Promise of Real Assets SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Impact Investing: The Promise of Real Assets
Impact investments-those that seek a specific social or environmental impact alongside financial returns-continue to grow rapidly. As investor interest grows, many investment firms are building capacity in this area. The author argues that in a world of low interest rates and a desire to increase returns and decrease uncertainty, real assets-investments in real estate or infrastructure projects such as low-cost rental housing and seniors' facilities-are a great starting place to try out impact investing.
Swot Analysis of "Impact Investing: The Promise of Real Assets" written by Rod Lohin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Impact Real facing as an external strategic factors. Some of the topics covered in Impact Investing: The Promise of Real Assets case study are - Strategic Management Strategies, Financial management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Impact Investing: The Promise of Real Assets casestudy better are - – increasing government debt because of Covid-19 spendings, there is backlash against globalization, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, increasing household debt because of falling income levels, increasing transportation and logistics costs,
geopolitical disruptions, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Impact Investing: The Promise of Real Assets
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Impact Investing: The Promise of Real Assets case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Impact Real, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Impact Real 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 Impact Investing: The Promise of Real Assets can be done for the following purposes –
1. Strategic planning using facts provided in Impact Investing: The Promise of Real Assets case study
2. Improving business portfolio management of Impact Real
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 Impact Real
Strengths Impact Investing: The Promise of Real Assets | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Impact Real in Impact Investing: The Promise of Real Assets Harvard Business Review case study are -
Diverse revenue streams
– Impact Real is present in almost all the verticals within the industry. This has provided firm in Impact Investing: The Promise of Real Assets 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Impact Investing: The Promise of Real Assets firm has clearly differentiated products in the market place. This has enabled Impact Real to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Impact Real to invest into research and development (R&D) and innovation.
Ability to lead change in Finance & Accounting field
– Impact Real 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 Impact Real in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Impact Real 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 Impact Investing: The Promise of Real Assets - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Impact Real has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Impact Real 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.
Cross disciplinary teams
– Horizontal connected teams at the Impact Real 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.
Training and development
– Impact Real has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Impact Investing: The Promise of Real Assets 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.
Strong track record of project management
– Impact Real is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Impact Real
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Impact Real does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Impact Real is one of the most innovative firm in sector. Manager in Impact Investing: The Promise of Real Assets Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Impact Real 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 Impact Real is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Impact Investing: The Promise of Real Assets Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Impact Real is one of the leading recruiters in the industry. Managers in the Impact Investing: The Promise of Real Assets are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Impact Investing: The Promise of Real Assets | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Impact Investing: The Promise of Real Assets are -
Slow decision making process
– As mentioned earlier in the report, Impact Real 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. Impact Real 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Impact Investing: The Promise of Real Assets, it seems that the employees of Impact Real 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.
Low market penetration in new markets
– Outside its home market of Impact Real, firm in the HBR case study Impact Investing: The Promise of Real Assets needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Impact Investing: The Promise of Real Assets 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 Impact Real 's lucrative customers.
Products dominated business model
– Even though Impact Real 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 - Impact Investing: The Promise of Real Assets should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study Impact Investing: The Promise of Real Assets, 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.
Need for greater diversity
– Impact Real 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Impact Investing: The Promise of Real Assets, in the dynamic environment Impact Real has struggled to respond to the nimble upstart competition. Impact Real has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Impact Investing: The Promise of Real Assets 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 Impact Real has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Rod Lohin suggests that, Impact Real 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.
Lack of clear differentiation of Impact Real products
– To increase the profitability and margins on the products, Impact Real needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Impact Investing: The Promise of Real Assets | 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 Impact Investing: The Promise of Real Assets are -
Loyalty marketing
– Impact Real 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Impact Real can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Impact Real in the consumer business. Now Impact Real can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Impact Real 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.
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. Impact Real can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Impact Real 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.
Building a culture of innovation
– managers at Impact Real 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.
Creating value in data economy
– The success of analytics program of Impact Real has opened avenues for new revenue streams for the organization in the industry. This can help Impact Real to build a more holistic ecosystem as suggested in the Impact Investing: The Promise of Real Assets case study. Impact Real can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Impact Real to increase its market reach. Impact Real 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Impact Real 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 Impact Real to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Impact Real 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Impact Real 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Impact Real is facing challenges because of the dominance of functional experts in the organization. Impact Investing: The Promise of Real Assets 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.
Threats Impact Investing: The Promise of Real Assets External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Impact Investing: The Promise of Real Assets are -
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. Impact Real needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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 Impact Real business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Impact Real 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 Impact Investing: The Promise of Real Assets .
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 Impact Real in the Finance & Accounting sector and impact the bottomline of the organization.
Increasing wage structure of Impact Real
– 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 Impact Real.
Technology acceleration in Forth Industrial Revolution
– Impact Real has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Impact Real needs to keep up with the evolution of technology in the Finance & Accounting 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.
High dependence on third party suppliers
– Impact Real 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.
Shortening product life cycle
– it is one of the major threat that Impact Real is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Impact Real 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.
Environmental challenges
– Impact Real 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. Impact Real can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Impact Investing: The Promise of Real Assets, Impact Real 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 .
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. Impact Real 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.
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 Impact Real.
Weighted SWOT Analysis of Impact Investing: The Promise of Real Assets 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 Impact Investing: The Promise of Real Assets 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 Impact Investing: The Promise of Real Assets 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 Impact Investing: The Promise of Real Assets 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 Impact Investing: The Promise of Real Assets 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 Impact Real needs to make to build a sustainable competitive advantage.