General Electric--2000: Quality of Earnings Assessment SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of General Electric--2000: Quality of Earnings Assessment
A financial analyst reviews General Electric's financial reports to learn more about U.S. Generally Accepted Accounting Principles (GAAP) and how they differs from international accounting standards.
Swot Analysis of "General Electric--2000: Quality of Earnings Assessment" written by David F. Hawkins includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Accounting Electric's facing as an external strategic factors. Some of the topics covered in General Electric--2000: Quality of Earnings Assessment case study are - Strategic Management Strategies, and Finance & Accounting.
Some of the macro environment factors that can be used to understand the General Electric--2000: Quality of Earnings Assessment casestudy better are - – there is backlash against globalization, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models,
increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of General Electric--2000: Quality of Earnings Assessment
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in General Electric--2000: Quality of Earnings Assessment case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Accounting Electric's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Accounting Electric's 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 General Electric--2000: Quality of Earnings Assessment can be done for the following purposes –
1. Strategic planning using facts provided in General Electric--2000: Quality of Earnings Assessment case study
2. Improving business portfolio management of Accounting Electric's
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 Accounting Electric's
Strengths General Electric--2000: Quality of Earnings Assessment | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Accounting Electric's in General Electric--2000: Quality of Earnings Assessment Harvard Business Review case study are -
Strong track record of project management
– Accounting Electric's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Finance & Accounting field
– Accounting Electric's 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 Accounting Electric's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Accounting Electric's is one of the leading recruiters in the industry. Managers in the General Electric--2000: Quality of Earnings Assessment are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Accounting Electric's 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.
Innovation driven organization
– Accounting Electric's is one of the most innovative firm in sector. Manager in General Electric--2000: Quality of Earnings Assessment Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Accounting Electric's 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 Accounting Electric's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in General Electric--2000: Quality of Earnings Assessment Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Accounting Electric's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Operational resilience
– The operational resilience strategy in the General Electric--2000: Quality of Earnings Assessment 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.
Diverse revenue streams
– Accounting Electric's is present in almost all the verticals within the industry. This has provided firm in General Electric--2000: Quality of Earnings Assessment 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.
Effective Research and Development (R&D)
– Accounting Electric's 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 General Electric--2000: Quality of Earnings Assessment - 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
– Accounting Electric's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Accounting Electric's 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.
Organizational Resilience of Accounting Electric's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Accounting Electric's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses General Electric--2000: Quality of Earnings Assessment | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of General Electric--2000: Quality of Earnings Assessment are -
Lack of clear differentiation of Accounting Electric's products
– To increase the profitability and margins on the products, Accounting Electric's needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Accounting Electric's supply chain. Even after few cautionary changes mentioned in the HBR case study - General Electric--2000: Quality of Earnings Assessment, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Accounting Electric's vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study General Electric--2000: Quality of Earnings Assessment, it seems that the employees of Accounting Electric's 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study General Electric--2000: Quality of Earnings Assessment, in the dynamic environment Accounting Electric's has struggled to respond to the nimble upstart competition. Accounting Electric's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Accounting Electric's is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Accounting Electric's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Accounting Electric's to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Accounting Electric's 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. Accounting Electric's 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the General Electric--2000: Quality of Earnings Assessment 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 Accounting Electric's has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study General Electric--2000: Quality of Earnings Assessment, is just above the industry average. Accounting Electric's 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Accounting Electric's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study General Electric--2000: Quality of Earnings Assessment can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High operating costs
– Compare to the competitors, firm in the HBR case study General Electric--2000: Quality of Earnings Assessment 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 Accounting Electric's 's lucrative customers.
Aligning sales with marketing
– It come across in the case study General Electric--2000: Quality of Earnings Assessment 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 General Electric--2000: Quality of Earnings Assessment can leverage the sales team experience to cultivate customer relationships as Accounting Electric's is planning to shift buying processes online.
Opportunities General Electric--2000: Quality of Earnings Assessment | 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 General Electric--2000: Quality of Earnings Assessment are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Accounting Electric's can use these opportunities to build new business models that can help the communities that Accounting Electric's operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Accounting Electric's 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 Accounting Electric's in the consumer business. Now Accounting Electric's can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Accounting Electric's is facing challenges because of the dominance of functional experts in the organization. General Electric--2000: Quality of Earnings Assessment 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.
Using analytics as competitive advantage
– Accounting Electric's 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 General Electric--2000: Quality of Earnings Assessment - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Accounting Electric's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Accounting Electric's 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.
Loyalty marketing
– Accounting Electric's 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.
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. Accounting Electric's 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. Accounting Electric's 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Accounting Electric's 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Accounting Electric's 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, General Electric--2000: Quality of Earnings Assessment, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Accounting Electric's 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Accounting Electric's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Accounting Electric's has opened avenues for new revenue streams for the organization in the industry. This can help Accounting Electric's to build a more holistic ecosystem as suggested in the General Electric--2000: Quality of Earnings Assessment case study. Accounting Electric's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats General Electric--2000: Quality of Earnings Assessment External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study General Electric--2000: Quality of Earnings Assessment are -
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Accounting Electric's in the Finance & Accounting sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Accounting Electric's has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Accounting Electric's 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.
High dependence on third party suppliers
– Accounting Electric's 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.
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. Accounting Electric's needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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. Accounting Electric's 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.
Environmental challenges
– Accounting Electric's 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. Accounting Electric's can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Increasing wage structure of Accounting Electric's
– 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 Accounting Electric's.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Accounting Electric's 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
– Accounting Electric's 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.
Shortening product life cycle
– it is one of the major threat that Accounting Electric's is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Accounting Electric's 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 General Electric--2000: Quality of Earnings Assessment .
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 Accounting Electric's business can come under increasing regulations regarding data privacy, data security, etc.
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.
Weighted SWOT Analysis of General Electric--2000: Quality of Earnings Assessment 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 General Electric--2000: Quality of Earnings Assessment 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 General Electric--2000: Quality of Earnings Assessment 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 General Electric--2000: Quality of Earnings Assessment 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 General Electric--2000: Quality of Earnings Assessment 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 Accounting Electric's needs to make to build a sustainable competitive advantage.
