The Panic of 1873 and the "Long Depression" (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Panic of 1873 and the "Long Depression" (A)
In 1878, President Rutherford B. Hayes must decide whether to sign the Bland-Allison Act and commit the United States to minting silver coins and thus return to a bimetal standard of currency. At issue is whether to grow the nation's money supply to sustain its galloping rate of economic development, or to constrain the money supply growth to enable the country to return to the international gold standard at the pre-Civil War parity to the British pound. National sentiment immediately after the war had been on the side of currency deflation, but the Panic of 1873 marked a turn in sentiment toward inflation. These cases focus on how and why that turn occurred, and its consequences.
Swot Analysis of "The Panic of 1873 and the "Long Depression" (A)" written by Robert F. Bruner includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that 1873 Sentiment facing as an external strategic factors. Some of the topics covered in The Panic of 1873 and the "Long Depression" (A) case study are - Strategic Management Strategies, Currency, Economics, Government, Labor, Recession and Finance & Accounting.
Some of the macro environment factors that can be used to understand the The Panic of 1873 and the "Long Depression" (A) casestudy better are - – increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, increasing commodity prices, challanges to central banks by blockchain based private currencies, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion,
technology disruption, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of The Panic of 1873 and the "Long Depression" (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Panic of 1873 and the "Long Depression" (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the 1873 Sentiment, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which 1873 Sentiment 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 The Panic of 1873 and the "Long Depression" (A) can be done for the following purposes –
1. Strategic planning using facts provided in The Panic of 1873 and the "Long Depression" (A) case study
2. Improving business portfolio management of 1873 Sentiment
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 1873 Sentiment
Strengths The Panic of 1873 and the "Long Depression" (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of 1873 Sentiment in The Panic of 1873 and the "Long Depression" (A) Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the The Panic of 1873 and the "Long Depression" (A) 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.
Ability to lead change in Finance & Accounting field
– 1873 Sentiment 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 1873 Sentiment in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- 1873 Sentiment 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 1873 Sentiment is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Panic of 1873 and the "Long Depression" (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High brand equity
– 1873 Sentiment has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled 1873 Sentiment to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that 1873 Sentiment 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.
Effective Research and Development (R&D)
– 1873 Sentiment 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 The Panic of 1873 and the "Long Depression" (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– 1873 Sentiment has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. 1873 Sentiment 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.
Ability to recruit top talent
– 1873 Sentiment is one of the leading recruiters in the industry. Managers in the The Panic of 1873 and the "Long Depression" (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– 1873 Sentiment 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 Robert F. Bruner 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.
Diverse revenue streams
– 1873 Sentiment is present in almost all the verticals within the industry. This has provided firm in The Panic of 1873 and the "Long Depression" (A) 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.
Cross disciplinary teams
– Horizontal connected teams at the 1873 Sentiment 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 1873 Sentiment
– The covid-19 pandemic has put organizational resilience at the centre of everthing that 1873 Sentiment does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses The Panic of 1873 and the "Long Depression" (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Panic of 1873 and the "Long Depression" (A) are -
Interest costs
– Compare to the competition, 1873 Sentiment 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Panic of 1873 and the "Long Depression" (A) 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 1873 Sentiment has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As The Panic of 1873 and the "Long Depression" (A) HBR case study mentions - 1873 Sentiment 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Panic of 1873 and the "Long Depression" (A), is just above the industry average. 1873 Sentiment needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Workers concerns about automation
– As automation is fast increasing in the segment, 1873 Sentiment 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.
Increasing silos among functional specialists
– The organizational structure of 1873 Sentiment is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. 1873 Sentiment needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help 1873 Sentiment to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study The Panic of 1873 and the "Long Depression" (A) 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 The Panic of 1873 and the "Long Depression" (A) can leverage the sales team experience to cultivate customer relationships as 1873 Sentiment is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study The Panic of 1873 and the "Long Depression" (A) 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 1873 Sentiment 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, 1873 Sentiment 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.
High cash cycle compare to competitors
1873 Sentiment 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 1873 Sentiment 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 - The Panic of 1873 and the "Long Depression" (A) should strive to include more intangible value offerings along with its core products and services.
Opportunities The Panic of 1873 and the "Long Depression" (A) | 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 The Panic of 1873 and the "Long Depression" (A) are -
Leveraging digital technologies
– 1873 Sentiment can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for 1873 Sentiment 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.
Manufacturing automation
– 1873 Sentiment 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.
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. 1873 Sentiment can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, 1873 Sentiment 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, The Panic of 1873 and the "Long Depression" (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 1873 Sentiment in the consumer business. Now 1873 Sentiment can target international markets with far fewer capital restrictions requirements than the existing system.
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. 1873 Sentiment 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. 1873 Sentiment 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.
Building a culture of innovation
– managers at 1873 Sentiment 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 1873 Sentiment 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.
Using analytics as competitive advantage
– 1873 Sentiment 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 The Panic of 1873 and the "Long Depression" (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help 1873 Sentiment to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– 1873 Sentiment 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.
Creating value in data economy
– The success of analytics program of 1873 Sentiment has opened avenues for new revenue streams for the organization in the industry. This can help 1873 Sentiment to build a more holistic ecosystem as suggested in the The Panic of 1873 and the "Long Depression" (A) case study. 1873 Sentiment can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help 1873 Sentiment to increase its market reach. 1873 Sentiment 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.
Threats The Panic of 1873 and the "Long Depression" (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Panic of 1873 and the "Long Depression" (A) are -
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. 1873 Sentiment needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Consumer confidence and its impact on 1873 Sentiment 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.
Increasing wage structure of 1873 Sentiment
– 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 1873 Sentiment.
High dependence on third party suppliers
– 1873 Sentiment 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.
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 1873 Sentiment in the Finance & Accounting sector and impact the bottomline of the organization.
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 1873 Sentiment.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, 1873 Sentiment 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 The Panic of 1873 and the "Long Depression" (A) .
Environmental challenges
– 1873 Sentiment 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. 1873 Sentiment can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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. 1873 Sentiment 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
– 1873 Sentiment has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, 1873 Sentiment 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.
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 1873 Sentiment 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.
Stagnating economy with rate increase
– 1873 Sentiment 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.
Weighted SWOT Analysis of The Panic of 1873 and the "Long Depression" (A) 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 The Panic of 1873 and the "Long Depression" (A) 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 The Panic of 1873 and the "Long Depression" (A) 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 The Panic of 1873 and the "Long Depression" (A) 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 The Panic of 1873 and the "Long Depression" (A) 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 1873 Sentiment needs to make to build a sustainable competitive advantage.
