Swot Analysis of "Shawmut National Corp.'s Merger with Bank of Boston Corp. (B)" written by Benjamin C. Esty includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Shawmut Corp facing as an external strategic factors. Some of the topics covered in Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) case study are - Strategic Management Strategies, Financial analysis, Mergers & acquisitions, Negotiations and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) casestudy better are - – there is backlash against globalization, technology disruption, increasing transportation and logistics costs, there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic ,
increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Shawmut National Corp.'s Merger with Bank of Boston Corp. (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Shawmut Corp, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Shawmut Corp 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 Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) can be done for the following purposes –
1. Strategic planning using facts provided in Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) case study
2. Improving business portfolio management of Shawmut Corp
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 Shawmut Corp
Strengths Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Shawmut Corp in Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) Harvard Business Review case study are -
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Shawmut Corp digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Shawmut Corp 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.
Strong track record of project management
– Shawmut Corp is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Shawmut Corp 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 Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Shawmut Corp
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Shawmut Corp does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Shawmut Corp 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 Benjamin C. Esty 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.
Successful track record of launching new products
– Shawmut Corp has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Shawmut Corp 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.
High switching costs
– The high switching costs that Shawmut Corp 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.
Ability to lead change in Finance & Accounting field
– Shawmut Corp 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 Shawmut Corp in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) firm has clearly differentiated products in the market place. This has enabled Shawmut Corp to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Shawmut Corp to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Shawmut Corp 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.
Low bargaining power of suppliers
– Suppliers of Shawmut Corp in the sector have low bargaining power. Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Shawmut Corp to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) are -
Products dominated business model
– Even though Shawmut Corp 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 - Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Benjamin C. Esty suggests that, Shawmut Corp 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.
Interest costs
– Compare to the competition, Shawmut Corp 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Shawmut Corp is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Shawmut National Corp.'s Merger with Bank of Boston Corp. (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.
Aligning sales with marketing
– It come across in the case study Shawmut National Corp.'s Merger with Bank of Boston Corp. (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 Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) can leverage the sales team experience to cultivate customer relationships as Shawmut Corp is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Shawmut National Corp.'s Merger with Bank of Boston Corp. (B), in the dynamic environment Shawmut Corp has struggled to respond to the nimble upstart competition. Shawmut Corp has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) HBR case study mentions - Shawmut Corp takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) 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 Shawmut Corp has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) 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 Shawmut Corp 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Shawmut Corp is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Shawmut Corp needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Shawmut Corp to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Shawmut Corp 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.
Opportunities Shawmut National Corp.'s Merger with Bank of Boston Corp. (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 Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) are -
Leveraging digital technologies
– Shawmut Corp 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.
Loyalty marketing
– Shawmut Corp 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.
Developing new processes and practices
– Shawmut Corp 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.
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. Shawmut Corp 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. Shawmut Corp 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.
Learning at scale
– Online learning technologies has now opened space for Shawmut Corp 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.
Building a culture of innovation
– managers at Shawmut Corp 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.
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 Shawmut Corp 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Shawmut Corp 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, Shawmut Corp can use these opportunities to build new business models that can help the communities that Shawmut Corp operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Manufacturing automation
– Shawmut Corp 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.
Creating value in data economy
– The success of analytics program of Shawmut Corp has opened avenues for new revenue streams for the organization in the industry. This can help Shawmut Corp to build a more holistic ecosystem as suggested in the Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) case study. Shawmut Corp can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Shawmut Corp can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) 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.
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 Shawmut Corp in the consumer business. Now Shawmut Corp can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Shawmut National Corp.'s Merger with Bank of Boston Corp. (B) are -
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 Shawmut Corp in the Finance & Accounting sector and impact the bottomline of the organization.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Shawmut Corp 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Shawmut National Corp.'s Merger with Bank of Boston Corp. (B), Shawmut Corp 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. Shawmut Corp 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.
Technology acceleration in Forth Industrial Revolution
– Shawmut Corp has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Shawmut Corp 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.
Increasing wage structure of Shawmut Corp
– 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 Shawmut Corp.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Shawmut Corp with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Shawmut Corp.
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. Shawmut Corp needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Environmental challenges
– Shawmut Corp 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. Shawmut Corp can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Stagnating economy with rate increase
– Shawmut Corp 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.
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 Shawmut Corp business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Shawmut National Corp.'s Merger with Bank of Boston Corp. (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 Shawmut National Corp.'s Merger with Bank of Boston Corp. (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 Shawmut National Corp.'s Merger with Bank of Boston Corp. (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 Shawmut National Corp.'s Merger with Bank of Boston Corp. (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 Shawmut National Corp.'s Merger with Bank of Boston Corp. (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 Shawmut Corp needs to make to build a sustainable competitive advantage.