Correcting Sight and Accounting at LCA-Vision Inc. SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Correcting Sight and Accounting at LCA-Vision Inc.
This case provides students with an opportunity to decide how to respond to an SEC inquiry and how to communicate adverse news. It does so in the context of accounting for separately priced extended warranties. LCA-Vision (LCA), a leading provider of LASIK vision-correction services, accounted for separately priced extended warranties incorrectly. Under US generally accepted accounting principles (GAAP), LCA was required to defer revenues associated with extended warranties. Instead, LCA recognized 93% of these revenues immediately, and deferred the 7% in accordance with the proportion of customers needing follow-up treatment. During the routine review process, the SEC posted a comment letter questioning this accounting treatment, which subsequently led to a restatement and shareholder litigation. Therefore, the case is an opportunity to examine how managers interact with regulatory bodies, communicate with investors, account for separately priced extended warranties, and correct erroneous filings via issuing a restatement. It is suitable for an audience of accounting students, or as an elective for general business students who have some exposure to accounting.
Swot Analysis of "Correcting Sight and Accounting at LCA-Vision Inc." written by Justin J. Hopkins includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Lca Warranties facing as an external strategic factors. Some of the topics covered in Correcting Sight and Accounting at LCA-Vision Inc. case study are - Strategic Management Strategies, Government and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Correcting Sight and Accounting at LCA-Vision Inc. casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, wage bills are increasing, increasing commodity prices, supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies,
geopolitical disruptions, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Correcting Sight and Accounting at LCA-Vision Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Correcting Sight and Accounting at LCA-Vision Inc. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lca Warranties, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lca Warranties 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 Correcting Sight and Accounting at LCA-Vision Inc. can be done for the following purposes –
1. Strategic planning using facts provided in Correcting Sight and Accounting at LCA-Vision Inc. case study
2. Improving business portfolio management of Lca Warranties
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 Lca Warranties
Strengths Correcting Sight and Accounting at LCA-Vision Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lca Warranties in Correcting Sight and Accounting at LCA-Vision Inc. Harvard Business Review case study are -
Learning organization
- Lca Warranties 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 Lca Warranties is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Correcting Sight and Accounting at LCA-Vision Inc. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Finance & Accounting field
– Lca Warranties 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 Lca Warranties in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Lca Warranties digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Lca Warranties has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Cross disciplinary teams
– Horizontal connected teams at the Lca Warranties 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.
High switching costs
– The high switching costs that Lca Warranties 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.
Innovation driven organization
– Lca Warranties is one of the most innovative firm in sector. Manager in Correcting Sight and Accounting at LCA-Vision Inc. Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Lca Warranties in the sector have low bargaining power. Correcting Sight and Accounting at LCA-Vision Inc. has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Lca Warranties to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Lca Warranties in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Lca Warranties has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Lca Warranties 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Correcting Sight and Accounting at LCA-Vision Inc. firm has clearly differentiated products in the market place. This has enabled Lca Warranties to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Lca Warranties to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Correcting Sight and Accounting at LCA-Vision Inc. 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.
Training and development
– Lca Warranties has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Correcting Sight and Accounting at LCA-Vision Inc. Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses Correcting Sight and Accounting at LCA-Vision Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Correcting Sight and Accounting at LCA-Vision Inc. are -
High operating costs
– Compare to the competitors, firm in the HBR case study Correcting Sight and Accounting at LCA-Vision Inc. 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 Lca Warranties 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Lca Warranties is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Correcting Sight and Accounting at LCA-Vision Inc. can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Lca Warranties products
– To increase the profitability and margins on the products, Lca Warranties needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Lca Warranties 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.
Products dominated business model
– Even though Lca Warranties 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 - Correcting Sight and Accounting at LCA-Vision Inc. should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Correcting Sight and Accounting at LCA-Vision Inc. 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 Lca Warranties has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Lca Warranties 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.
Interest costs
– Compare to the competition, Lca Warranties 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Correcting Sight and Accounting at LCA-Vision Inc., in the dynamic environment Lca Warranties has struggled to respond to the nimble upstart competition. Lca Warranties has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Lca Warranties 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 decision making process
– As mentioned earlier in the report, Lca Warranties 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. Lca Warranties 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.
Opportunities Correcting Sight and Accounting at LCA-Vision Inc. | 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 Correcting Sight and Accounting at LCA-Vision Inc. are -
Loyalty marketing
– Lca Warranties 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.
Creating value in data economy
– The success of analytics program of Lca Warranties has opened avenues for new revenue streams for the organization in the industry. This can help Lca Warranties to build a more holistic ecosystem as suggested in the Correcting Sight and Accounting at LCA-Vision Inc. case study. Lca Warranties can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Lca Warranties can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Correcting Sight and Accounting at LCA-Vision Inc. 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.
Using analytics as competitive advantage
– Lca Warranties 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 Correcting Sight and Accounting at LCA-Vision Inc. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Lca Warranties to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Lca Warranties 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. Lca Warranties 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.
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. Lca Warranties can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Lca Warranties 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Lca Warranties can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Lca Warranties can use these opportunities to build new business models that can help the communities that Lca Warranties operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Better consumer reach
– The expansion of the 5G network will help Lca Warranties to increase its market reach. Lca Warranties 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 Lca Warranties 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.
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 Lca Warranties in the consumer business. Now Lca Warranties can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Lca Warranties 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.
Threats Correcting Sight and Accounting at LCA-Vision Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Correcting Sight and Accounting at LCA-Vision Inc. are -
Environmental challenges
– Lca Warranties 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. Lca Warranties can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Consumer confidence and its impact on Lca Warranties 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.
Shortening product life cycle
– it is one of the major threat that Lca Warranties is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Lca Warranties 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.
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. Lca Warranties needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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. Lca Warranties 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 Lca Warranties.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Lca Warranties can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Lca Warranties 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 Correcting Sight and Accounting at LCA-Vision Inc. .
Increasing wage structure of Lca Warranties
– 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 Lca Warranties.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Correcting Sight and Accounting at LCA-Vision Inc., Lca Warranties 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 .
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 Lca Warranties business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Lca Warranties with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Correcting Sight and Accounting at LCA-Vision Inc. 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 Correcting Sight and Accounting at LCA-Vision Inc. 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 Correcting Sight and Accounting at LCA-Vision Inc. 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 Correcting Sight and Accounting at LCA-Vision Inc. 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 Correcting Sight and Accounting at LCA-Vision Inc. 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 Lca Warranties needs to make to build a sustainable competitive advantage.