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 - – increasing government debt because of Covid-19 spendings, there is backlash against globalization, increasing energy prices, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions,
central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, 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 -
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.
Organizational Resilience of Lca Warranties
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Lca Warranties does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Lca Warranties 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 Justin J. Hopkins 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.
Ability to recruit top talent
– Lca Warranties is one of the leading recruiters in the industry. Managers in the Correcting Sight and Accounting at LCA-Vision Inc. are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
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.
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.
Diverse revenue streams
– Lca Warranties is present in almost all the verticals within the industry. This has provided firm in Correcting Sight and Accounting at LCA-Vision Inc. 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.
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.
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.
Effective Research and Development (R&D)
– Lca Warranties 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 Correcting Sight and Accounting at LCA-Vision Inc. - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Lca Warranties is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
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.
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 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 Lca Warranties supply chain. Even after few cautionary changes mentioned in the HBR case study - Correcting Sight and Accounting at LCA-Vision Inc., it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Lca Warranties vulnerable to further global disruptions in South East Asia.
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.
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.
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.
Workers concerns about automation
– As automation is fast increasing in the segment, Lca Warranties 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.
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.
Aligning sales with marketing
– It come across in the case study Correcting Sight and Accounting at LCA-Vision Inc. 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 Correcting Sight and Accounting at LCA-Vision Inc. can leverage the sales team experience to cultivate customer relationships as Lca Warranties is planning to shift buying processes online.
Low market penetration in new markets
– Outside its home market of Lca Warranties, firm in the HBR case study Correcting Sight and Accounting at LCA-Vision Inc. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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.
No frontier risks strategy
– After analyzing the HBR case study Correcting Sight and Accounting at LCA-Vision Inc., 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 Lca Warranties 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.
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 -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Lca Warranties 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 Lca Warranties to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Lca Warranties 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.
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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Lca Warranties is facing challenges because of the dominance of functional experts in the organization. Correcting Sight and Accounting at LCA-Vision Inc. 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.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Lca Warranties 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, Correcting Sight and Accounting at LCA-Vision Inc., to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Lca Warranties 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.
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.
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.
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.
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 Lca Warranties 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.
Developing new processes and practices
– Lca Warranties can develop new processes and procedures in Finance & Accounting industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
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 -
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.
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.
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. .
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.
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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Lca Warranties 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.
Technology acceleration in Forth Industrial Revolution
– Lca Warranties has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Lca Warranties 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 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.
High dependence on third party suppliers
– Lca Warranties 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.
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.
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.
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.
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.
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.
