Sabotage in the Financial System: Lessons from Veblen SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Sabotage in the Financial System: Lessons from Veblen
The global financial crisis that started in the summer of 2007 has generated a wide-ranging discussion about the causes of the meltdown and the role of banking and bankers in today's economy. However, the ongoing debate rarely addresses questions of business tactics in the financial industry. Indeed, while 'incentives,' 'vested interests,' power, and--increasingly--social utility are often factored into analyses of financial regulation, the strategies and tactics of financial institutions are rarely discussed in a systematic way in academic and policy debate. Nonetheless, we believe that these two elements are key to understanding the financial system, not as a mere sector of the wider economy but as a business enterprise driven by its own logic and shaped by a variety of business tactics of its key agents. In our vision of finance as business, we draw on the concept of industrial sabotage as a business tactic (originally developed by Thorstein Veblen) to explore the roots of the financial sector's contemporary architecture. Our key premise is that the central motive driving the process often described as 'financialization' or financial innovation is the sabotage instinct of finance operating as business. Whereas Veblen originally understood sabotage as ''conscientious withdrawal of efficiency,'' today, we argue, the workings of the banking and financial sector augment the very notion of efficiency by relying on concepts, techniques, and institutions of financial innovation that are shrouded in complexity. In this article, we explore conceptual, institutional, and selected policy dimensions of this phenomenon.
Swot Analysis of "Sabotage in the Financial System: Lessons from Veblen" written by Anastasia Nesvetailova, Ronen Palan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sabotage Veblen facing as an external strategic factors. Some of the topics covered in Sabotage in the Financial System: Lessons from Veblen case study are - Strategic Management Strategies, Financial management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Sabotage in the Financial System: Lessons from Veblen casestudy better are - – increasing commodity prices, increasing transportation and logistics costs, there is backlash against globalization, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, increasing energy prices, digital marketing is dominated by two big players Facebook and Google,
talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Sabotage in the Financial System: Lessons from Veblen
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Sabotage in the Financial System: Lessons from Veblen case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sabotage Veblen, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sabotage Veblen 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 Sabotage in the Financial System: Lessons from Veblen can be done for the following purposes –
1. Strategic planning using facts provided in Sabotage in the Financial System: Lessons from Veblen case study
2. Improving business portfolio management of Sabotage Veblen
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 Sabotage Veblen
Strengths Sabotage in the Financial System: Lessons from Veblen | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sabotage Veblen in Sabotage in the Financial System: Lessons from Veblen Harvard Business Review case study are -
Training and development
– Sabotage Veblen has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Sabotage in the Financial System: Lessons from Veblen 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Sabotage Veblen digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sabotage Veblen 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Sabotage in the Financial System: Lessons from Veblen firm has clearly differentiated products in the market place. This has enabled Sabotage Veblen to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Sabotage Veblen to invest into research and development (R&D) and innovation.
Organizational Resilience of Sabotage Veblen
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Sabotage Veblen does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Sabotage Veblen is one of the most innovative firm in sector. Manager in Sabotage in the Financial System: Lessons from Veblen Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Sabotage Veblen 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 Sabotage Veblen is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Sabotage in the Financial System: Lessons from Veblen Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Sabotage Veblen is present in almost all the verticals within the industry. This has provided firm in Sabotage in the Financial System: Lessons from Veblen 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.
Low bargaining power of suppliers
– Suppliers of Sabotage Veblen in the sector have low bargaining power. Sabotage in the Financial System: Lessons from Veblen has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sabotage Veblen to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Sabotage Veblen 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 Sabotage in the Financial System: Lessons from Veblen HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Sabotage Veblen is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Sabotage Veblen 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 Anastasia Nesvetailova, Ronen Palan 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.
Cross disciplinary teams
– Horizontal connected teams at the Sabotage Veblen 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.
Weaknesses Sabotage in the Financial System: Lessons from Veblen | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sabotage in the Financial System: Lessons from Veblen are -
High bargaining power of channel partners
– Because of the regulatory requirements, Anastasia Nesvetailova, Ronen Palan suggests that, Sabotage Veblen 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Sabotage in the Financial System: Lessons from Veblen 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 Sabotage Veblen 's lucrative customers.
Interest costs
– Compare to the competition, Sabotage Veblen 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Sabotage Veblen 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.
Slow to strategic competitive environment developments
– As Sabotage in the Financial System: Lessons from Veblen HBR case study mentions - Sabotage Veblen 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.
Aligning sales with marketing
– It come across in the case study Sabotage in the Financial System: Lessons from Veblen 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 Sabotage in the Financial System: Lessons from Veblen can leverage the sales team experience to cultivate customer relationships as Sabotage Veblen is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Sabotage Veblen 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Sabotage in the Financial System: Lessons from Veblen 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 Sabotage Veblen has relatively successful track record of launching new products.
Lack of clear differentiation of Sabotage Veblen products
– To increase the profitability and margins on the products, Sabotage Veblen needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Sabotage Veblen 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.
Increasing silos among functional specialists
– The organizational structure of Sabotage Veblen is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Sabotage Veblen needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sabotage Veblen to focus more on services rather than just following the product oriented approach.
Opportunities Sabotage in the Financial System: Lessons from Veblen | 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 Sabotage in the Financial System: Lessons from Veblen are -
Creating value in data economy
– The success of analytics program of Sabotage Veblen has opened avenues for new revenue streams for the organization in the industry. This can help Sabotage Veblen to build a more holistic ecosystem as suggested in the Sabotage in the Financial System: Lessons from Veblen case study. Sabotage Veblen can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sabotage Veblen 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, Sabotage in the Financial System: Lessons from Veblen, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Sabotage Veblen 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.
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. Sabotage Veblen 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. Sabotage Veblen 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 Sabotage Veblen 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.
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. Sabotage Veblen can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Sabotage Veblen can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sabotage Veblen is facing challenges because of the dominance of functional experts in the organization. Sabotage in the Financial System: Lessons from Veblen 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.
Building a culture of innovation
– managers at Sabotage Veblen 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sabotage Veblen 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
– Sabotage Veblen 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.
Loyalty marketing
– Sabotage Veblen 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sabotage Veblen can use these opportunities to build new business models that can help the communities that Sabotage Veblen operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Threats Sabotage in the Financial System: Lessons from Veblen External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Sabotage in the Financial System: Lessons from Veblen are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Sabotage in the Financial System: Lessons from Veblen, Sabotage Veblen 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 .
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. Sabotage Veblen needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Sabotage Veblen has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Sabotage Veblen 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.
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. Sabotage Veblen can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Sabotage Veblen demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sabotage Veblen with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Shortening product life cycle
– it is one of the major threat that Sabotage Veblen is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Sabotage Veblen 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. Sabotage Veblen can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Regulatory challenges
– Sabotage Veblen needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Finance & Accounting industry regulations.
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 Sabotage Veblen.
High dependence on third party suppliers
– Sabotage Veblen 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.
Increasing wage structure of Sabotage Veblen
– 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 Sabotage Veblen.
Weighted SWOT Analysis of Sabotage in the Financial System: Lessons from Veblen 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 Sabotage in the Financial System: Lessons from Veblen 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 Sabotage in the Financial System: Lessons from Veblen 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 Sabotage in the Financial System: Lessons from Veblen 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 Sabotage in the Financial System: Lessons from Veblen 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 Sabotage Veblen needs to make to build a sustainable competitive advantage.
