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PIPES: Private Equity Investments in Distressed Firms SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of PIPES: Private Equity Investments in Distressed Firms


This is a Darden case study.This technical note describes the basic features of a new type of security called Private Investments in Public Equities (PIPEs). Increasingly public companies in need of financing are raising capital through private equity investors via PIPEs.

Authors :: Susan Chaplinsky

Topics :: Finance & Accounting

Tags :: Financial management, Financial markets, Venture capital, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "PIPES: Private Equity Investments in Distressed Firms" written by Susan Chaplinsky includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Pipes Private facing as an external strategic factors. Some of the topics covered in PIPES: Private Equity Investments in Distressed Firms case study are - Strategic Management Strategies, Financial management, Financial markets, Venture capital and Finance & Accounting.


Some of the macro environment factors that can be used to understand the PIPES: Private Equity Investments in Distressed Firms casestudy better are - – increasing transportation and logistics costs, increasing energy prices, talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, increasing commodity prices, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing inequality as vast percentage of new income is going to the top 1%, etc



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Introduction to SWOT Analysis of PIPES: Private Equity Investments in Distressed Firms


SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in PIPES: Private Equity Investments in Distressed Firms case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pipes Private, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pipes Private 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 PIPES: Private Equity Investments in Distressed Firms can be done for the following purposes –
1. Strategic planning using facts provided in PIPES: Private Equity Investments in Distressed Firms case study
2. Improving business portfolio management of Pipes Private
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 Pipes Private




Strengths PIPES: Private Equity Investments in Distressed Firms | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Pipes Private in PIPES: Private Equity Investments in Distressed Firms Harvard Business Review case study are -

Successful track record of launching new products

– Pipes Private has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Pipes Private 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.

Diverse revenue streams

– Pipes Private is present in almost all the verticals within the industry. This has provided firm in PIPES: Private Equity Investments in Distressed Firms 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 Pipes Private 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.

Analytics focus

– Pipes Private 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 Susan Chaplinsky 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.

Superior customer experience

– The customer experience strategy of Pipes Private in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Ability to recruit top talent

– Pipes Private is one of the leading recruiters in the industry. Managers in the PIPES: Private Equity Investments in Distressed Firms 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

– Pipes Private 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 PIPES: Private Equity Investments in Distressed Firms HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Strong track record of project management

– Pipes Private is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Training and development

– Pipes Private has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in PIPES: Private Equity Investments in Distressed Firms Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.

High switching costs

– The high switching costs that Pipes Private 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.

Low bargaining power of suppliers

– Suppliers of Pipes Private in the sector have low bargaining power. PIPES: Private Equity Investments in Distressed Firms has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pipes Private to manage not only supply disruptions but also source products at highly competitive prices.

Innovation driven organization

– Pipes Private is one of the most innovative firm in sector. Manager in PIPES: Private Equity Investments in Distressed Firms Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.






Weaknesses PIPES: Private Equity Investments in Distressed Firms | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of PIPES: Private Equity Investments in Distressed Firms are -

Need for greater diversity

– Pipes Private 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.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study PIPES: Private Equity Investments in Distressed Firms, is just above the industry average. Pipes Private 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.

High bargaining power of channel partners

– Because of the regulatory requirements, Susan Chaplinsky suggests that, Pipes Private 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.

Lack of clear differentiation of Pipes Private products

– To increase the profitability and margins on the products, Pipes Private 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, Pipes Private is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study PIPES: Private Equity Investments in Distressed Firms can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

No frontier risks strategy

– After analyzing the HBR case study PIPES: Private Equity Investments in Distressed Firms, 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.

High operating costs

– Compare to the competitors, firm in the HBR case study PIPES: Private Equity Investments in Distressed Firms 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 Pipes Private 's lucrative customers.

Slow decision making process

– As mentioned earlier in the report, Pipes Private 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. Pipes Private 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.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study PIPES: Private Equity Investments in Distressed Firms, it seems that the employees of Pipes Private 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 PIPES: Private Equity Investments in Distressed Firms 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 PIPES: Private Equity Investments in Distressed Firms can leverage the sales team experience to cultivate customer relationships as Pipes Private is planning to shift buying processes online.

Slow to strategic competitive environment developments

– As PIPES: Private Equity Investments in Distressed Firms HBR case study mentions - Pipes Private 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.




Opportunities PIPES: Private Equity Investments in Distressed Firms | 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 PIPES: Private Equity Investments in Distressed Firms are -

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 Pipes Private 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.

Leveraging digital technologies

– Pipes Private 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 Pipes Private to increase its market reach. Pipes Private 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Pipes Private is facing challenges because of the dominance of functional experts in the organization. PIPES: Private Equity Investments in Distressed Firms 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.

Manufacturing automation

– Pipes Private 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.

Using analytics as competitive advantage

– Pipes Private 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 PIPES: Private Equity Investments in Distressed Firms - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Pipes Private to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

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. Pipes Private can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Low interest rates

– Even though inflation is raising its head in most developed economies, Pipes Private can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.

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 Pipes Private in the consumer business. Now Pipes Private can target international markets with far fewer capital restrictions requirements than the existing system.

Creating value in data economy

– The success of analytics program of Pipes Private has opened avenues for new revenue streams for the organization in the industry. This can help Pipes Private to build a more holistic ecosystem as suggested in the PIPES: Private Equity Investments in Distressed Firms case study. Pipes Private can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Pipes Private can use these opportunities to build new business models that can help the communities that Pipes Private operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.

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. Pipes Private 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. Pipes Private 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.

Buying journey improvements

– Pipes Private can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. PIPES: Private Equity Investments in Distressed Firms 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.




Threats PIPES: Private Equity Investments in Distressed Firms External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The threats mentioned in the HBR case study PIPES: Private Equity Investments in Distressed Firms are -

Consumer confidence and its impact on Pipes Private 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.

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 Pipes Private in the Finance & Accounting sector and impact the bottomline of the organization.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Pipes Private 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.

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 Pipes Private business can come under increasing regulations regarding data privacy, data security, etc.

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 Pipes Private.

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.

Environmental challenges

– Pipes Private 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. Pipes Private can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.

Shortening product life cycle

– it is one of the major threat that Pipes Private is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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.

Stagnating economy with rate increase

– Pipes Private 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Pipes Private 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 PIPES: Private Equity Investments in Distressed Firms .

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. Pipes Private 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.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Pipes Private with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.




Weighted SWOT Analysis of PIPES: Private Equity Investments in Distressed Firms 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 PIPES: Private Equity Investments in Distressed Firms 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 PIPES: Private Equity Investments in Distressed Firms 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 PIPES: Private Equity Investments in Distressed Firms 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 PIPES: Private Equity Investments in Distressed Firms 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 Pipes Private needs to make to build a sustainable competitive advantage.



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