Goldman Sachs (B): Determining the Potential of Social Impact Bonds SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Goldman Sachs (B): Determining the Potential of Social Impact Bonds
Partnering with Bloomberg Philanthropies, MDRC, the Vera Institute of Justice, and the New York State Department of Corrections, Goldman decided to go ahead with the social impact bond (SIB) project to reduce youth recidivism. If there were lower rates of recidivism under the program, the city would not have to repay Goldman's loans; Goldman would accept the risk. The city would in turn save money, allowing it to repay the bond. Before the bank knew whether the initiative would be successful, it was already moving on to new social investments. The firm was looking into an SIB to fund an expansion for a high-quality early childhood preschool program in the Granite School District of Central Salt Lake, Utah. The expansion would empower more children with early preparation, decreasing the need for special education and remedial services and saving the district money. Students are tasked with evaluating new social investment instruments, ways to mitigate risk, and the role of banks in social impact.
Authors :: Andrew Hoffman
Topics :: Finance & Accounting
Tags :: Social enterprise, Social responsibility, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis
Swot Analysis of "Goldman Sachs (B): Determining the Potential of Social Impact Bonds" written by Andrew Hoffman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Goldman Recidivism facing as an external strategic factors. Some of the topics covered in Goldman Sachs (B): Determining the Potential of Social Impact Bonds case study are - Strategic Management Strategies, Social enterprise, Social responsibility and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Goldman Sachs (B): Determining the Potential of Social Impact Bonds casestudy better are - – digital marketing is dominated by two big players Facebook and Google, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , increasing commodity prices, increasing government debt because of Covid-19 spendings,
there is increasing trade war between United States & China, there is backlash against globalization, etc
Introduction to SWOT Analysis of Goldman Sachs (B): Determining the Potential of Social Impact Bonds
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Goldman Sachs (B): Determining the Potential of Social Impact Bonds case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Goldman Recidivism, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Goldman Recidivism 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds can be done for the following purposes –
1. Strategic planning using facts provided in Goldman Sachs (B): Determining the Potential of Social Impact Bonds case study
2. Improving business portfolio management of Goldman Recidivism
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 Goldman Recidivism
Strengths Goldman Sachs (B): Determining the Potential of Social Impact Bonds | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Goldman Recidivism in Goldman Sachs (B): Determining the Potential of Social Impact Bonds Harvard Business Review case study are -
Effective Research and Development (R&D)
– Goldman Recidivism 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Goldman Recidivism 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 Goldman Recidivism is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Goldman Sachs (B): Determining the Potential of Social Impact Bonds Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Goldman Recidivism 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.
Innovation driven organization
– Goldman Recidivism is one of the most innovative firm in sector. Manager in Goldman Sachs (B): Determining the Potential of Social Impact Bonds Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Goldman Recidivism is one of the leading recruiters in the industry. Managers in the Goldman Sachs (B): Determining the Potential of Social Impact Bonds are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Goldman Recidivism 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Goldman Recidivism digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Goldman Recidivism 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.
Operational resilience
– The operational resilience strategy in the Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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
– Goldman Sachs (B): Determining the Potential of Social Impact Bonds firm has clearly differentiated products in the market place. This has enabled Goldman Recidivism to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Goldman Recidivism to invest into research and development (R&D) and innovation.
Analytics focus
– Goldman Recidivism 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 Andrew Hoffman 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.
Low bargaining power of suppliers
– Suppliers of Goldman Recidivism in the sector have low bargaining power. Goldman Sachs (B): Determining the Potential of Social Impact Bonds has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Goldman Recidivism to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Goldman Recidivism 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.
Weaknesses Goldman Sachs (B): Determining the Potential of Social Impact Bonds | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Goldman Sachs (B): Determining the Potential of Social Impact Bonds are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Goldman Recidivism is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Goldman Recidivism, firm in the HBR case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Goldman Recidivism 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 - Goldman Sachs (B): Determining the Potential of Social Impact Bonds should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds, it seems that the employees of Goldman Recidivism 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.
Aligning sales with marketing
– It come across in the case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds can leverage the sales team experience to cultivate customer relationships as Goldman Recidivism is planning to shift buying processes online.
Interest costs
– Compare to the competition, Goldman Recidivism has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds, in the dynamic environment Goldman Recidivism has struggled to respond to the nimble upstart competition. Goldman Recidivism has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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 Goldman Recidivism 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Goldman Recidivism 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. Goldman Recidivism 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.
No frontier risks strategy
– After analyzing the HBR case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds, 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 Goldman Recidivism 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds | 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds are -
Better consumer reach
– The expansion of the 5G network will help Goldman Recidivism to increase its market reach. Goldman Recidivism 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.
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. Goldman Recidivism can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Goldman Recidivism is facing challenges because of the dominance of functional experts in the organization. Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Goldman Recidivism can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Goldman Recidivism 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Goldman Recidivism 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, Goldman Sachs (B): Determining the Potential of Social Impact Bonds, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Goldman Recidivism can use these opportunities to build new business models that can help the communities that Goldman Recidivism operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Creating value in data economy
– The success of analytics program of Goldman Recidivism has opened avenues for new revenue streams for the organization in the industry. This can help Goldman Recidivism to build a more holistic ecosystem as suggested in the Goldman Sachs (B): Determining the Potential of Social Impact Bonds case study. Goldman Recidivism can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Goldman Recidivism 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.
Learning at scale
– Online learning technologies has now opened space for Goldman Recidivism 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.
Manufacturing automation
– Goldman Recidivism 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.
Buying journey improvements
– Goldman Recidivism can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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.
Loyalty marketing
– Goldman Recidivism 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.
Threats Goldman Sachs (B): Determining the Potential of Social Impact Bonds External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds are -
Environmental challenges
– Goldman Recidivism 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. Goldman Recidivism can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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 Goldman Recidivism business can come under increasing regulations regarding data privacy, data security, etc.
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. Goldman Recidivism needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Goldman Recidivism with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Goldman Recidivism 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds .
Consumer confidence and its impact on Goldman Recidivism 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.
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. Goldman Recidivism 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.
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 Goldman Recidivism 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Goldman Sachs (B): Determining the Potential of Social Impact Bonds, Goldman Recidivism 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 .
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Goldman Recidivism can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Goldman Recidivism
– 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 Goldman Recidivism.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Goldman Recidivism 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.
Weighted SWOT Analysis of Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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 Goldman Sachs (B): Determining the Potential of Social Impact Bonds 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 Goldman Recidivism needs to make to build a sustainable competitive advantage.