Case Study Description of Imation Corp.: An Activist Proxy Battle (B)
The A case in this series takes the viewpoint of a senior portfolio manager who has to decide how to vote the shares held by Wells Fargo Asset Management: she can vote for the current board members of Imation Corp. (IMN) or for the nominees put forward by an activist hedge fund. The hedge fund sent an open letter to IMN shareholders seeking support to replace the key members of IMN's board, as the first step in pushing through sweeping changes in compensation and strategy at IMN. The case illustrates the power of an activist investor to change the governance and strategy of a company. The B case reveals that the activist's nominees were elected, and a series of decisions ensued that dismantled IMN. The case presents students with ethical questions regarding the treatment of IMN shareholders; it also highlights the influence of proxy advisers in a proxy vote. The case has been taught in an MBA corporate finance elective as the second class in activism, following another activist case, "Genzyme and Relational Investors: Science and Business Collide?" (UVA-F-1660). It can be taught to all undergraduate and graduate levels of business students, as well as seasoned executives.
Swot Analysis of "Imation Corp.: An Activist Proxy Battle (B)" written by Kenneth Eades, Kyle Perez includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Imn Activist facing as an external strategic factors. Some of the topics covered in Imation Corp.: An Activist Proxy Battle (B) case study are - Strategic Management Strategies, Financial management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Imation Corp.: An Activist Proxy Battle (B) casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, there is backlash against globalization, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, increasing commodity prices, technology disruption,
banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Imation Corp.: An Activist Proxy Battle (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Imation Corp.: An Activist Proxy Battle (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Imn Activist, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Imn Activist 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 Imation Corp.: An Activist Proxy Battle (B) can be done for the following purposes –
1. Strategic planning using facts provided in Imation Corp.: An Activist Proxy Battle (B) case study
2. Improving business portfolio management of Imn Activist
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 Imn Activist
Strengths Imation Corp.: An Activist Proxy Battle (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Imn Activist in Imation Corp.: An Activist Proxy Battle (B) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Imn Activist in the sector have low bargaining power. Imation Corp.: An Activist Proxy Battle (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Imn Activist to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Imn Activist is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Imn Activist 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 Imation Corp.: An Activist Proxy Battle (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Imn Activist digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Imn Activist 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.
Organizational Resilience of Imn Activist
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Imn Activist does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Imn Activist is one of the leading recruiters in the industry. Managers in the Imation Corp.: An Activist Proxy Battle (B) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Imn Activist is one of the most innovative firm in sector. Manager in Imation Corp.: An Activist Proxy Battle (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Imn Activist 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 Imn Activist is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Imation Corp.: An Activist Proxy Battle (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Imn Activist in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Finance & Accounting industry
– Imation Corp.: An Activist Proxy Battle (B) firm has clearly differentiated products in the market place. This has enabled Imn Activist to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Imn Activist to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Imn Activist is present in almost all the verticals within the industry. This has provided firm in Imation Corp.: An Activist Proxy Battle (B) 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.
Highly skilled collaborators
– Imn Activist 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 Imation Corp.: An Activist Proxy Battle (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Imation Corp.: An Activist Proxy Battle (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Imation Corp.: An Activist Proxy Battle (B) are -
Products dominated business model
– Even though Imn Activist 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 - Imation Corp.: An Activist Proxy Battle (B) should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Imn Activist 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Imation Corp.: An Activist Proxy Battle (B), in the dynamic environment Imn Activist has struggled to respond to the nimble upstart competition. Imn Activist has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Imation Corp.: An Activist Proxy Battle (B) 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 Imation Corp.: An Activist Proxy Battle (B) can leverage the sales team experience to cultivate customer relationships as Imn Activist is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Kenneth Eades, Kyle Perez suggests that, Imn Activist 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.
Skills based hiring
– The stress on hiring functional specialists at Imn Activist 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.
Capital Spending Reduction
– Even during the low interest decade, Imn Activist 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.
Increasing silos among functional specialists
– The organizational structure of Imn Activist is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Imn Activist needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Imn Activist to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Imation Corp.: An Activist Proxy Battle (B), it seems that the employees of Imn Activist 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.
Lack of clear differentiation of Imn Activist products
– To increase the profitability and margins on the products, Imn Activist needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Imn Activist is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Imation Corp.: An Activist Proxy Battle (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Imation Corp.: An Activist Proxy Battle (B) | 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 Imation Corp.: An Activist Proxy Battle (B) are -
Leveraging digital technologies
– Imn Activist 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.
Better consumer reach
– The expansion of the 5G network will help Imn Activist to increase its market reach. Imn Activist 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Imn Activist can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Imn Activist can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Imn Activist 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. Imn Activist 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.
Loyalty marketing
– Imn Activist 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.
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 Imn Activist 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.
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. Imn Activist can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Imn Activist in the consumer business. Now Imn Activist can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Imn Activist 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, Imation Corp.: An Activist Proxy Battle (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Imn Activist has opened avenues for new revenue streams for the organization in the industry. This can help Imn Activist to build a more holistic ecosystem as suggested in the Imation Corp.: An Activist Proxy Battle (B) case study. Imn Activist can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Imn Activist 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.
Building a culture of innovation
– managers at Imn Activist 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 Imation Corp.: An Activist Proxy Battle (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Imation Corp.: An Activist Proxy Battle (B) are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Imn Activist 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.
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 Imn Activist in the Finance & Accounting sector and impact the bottomline of the organization.
Regulatory challenges
– Imn Activist 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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Increasing wage structure of Imn Activist
– 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 Imn Activist.
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.
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 Imn Activist 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, Imn Activist 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 Imation Corp.: An Activist Proxy Battle (B) .
Stagnating economy with rate increase
– Imn Activist 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.
Consumer confidence and its impact on Imn Activist 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Imn Activist with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Imn Activist 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. Imn Activist can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Technology acceleration in Forth Industrial Revolution
– Imn Activist has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Imn Activist 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.
Weighted SWOT Analysis of Imation Corp.: An Activist Proxy Battle (B) 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 Imation Corp.: An Activist Proxy Battle (B) 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 Imation Corp.: An Activist Proxy Battle (B) 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 Imation Corp.: An Activist Proxy Battle (B) 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 Imation Corp.: An Activist Proxy Battle (B) 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 Imn Activist needs to make to build a sustainable competitive advantage.
