Infinity Bank (A): Retail Branches and Customer Profitability SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Infinity Bank (A): Retail Branches and Customer Profitability
A retail bank is considering a strategy to improve branch performance. Central to the strategy is a recent study of profitability of three retail products: current accounts, credit cards, and mortgages. The strategy involves giving branch managers incentives to sell profitable products. A senior bank manager evaluates the product-profitability-based strategy in the light of recent statistics on major variations in profitability of customers (these statistics are included in the database provided with the case).
Swot Analysis of "Infinity Bank (A): Retail Branches and Customer Profitability" written by Igor Vaysman, Stephen Smyth includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Profitability Branch facing as an external strategic factors. Some of the topics covered in Infinity Bank (A): Retail Branches and Customer Profitability case study are - Strategic Management Strategies, Sales and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Infinity Bank (A): Retail Branches and Customer Profitability casestudy better are - – there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , geopolitical disruptions,
increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Infinity Bank (A): Retail Branches and Customer Profitability
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Infinity Bank (A): Retail Branches and Customer Profitability case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Profitability Branch, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Profitability Branch 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 Infinity Bank (A): Retail Branches and Customer Profitability can be done for the following purposes –
1. Strategic planning using facts provided in Infinity Bank (A): Retail Branches and Customer Profitability case study
2. Improving business portfolio management of Profitability Branch
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 Profitability Branch
Strengths Infinity Bank (A): Retail Branches and Customer Profitability | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Profitability Branch in Infinity Bank (A): Retail Branches and Customer Profitability Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Profitability Branch in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Profitability Branch in the sector have low bargaining power. Infinity Bank (A): Retail Branches and Customer Profitability has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Profitability Branch to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Profitability Branch is present in almost all the verticals within the industry. This has provided firm in Infinity Bank (A): Retail Branches and Customer Profitability 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.
Innovation driven organization
– Profitability Branch is one of the most innovative firm in sector. Manager in Infinity Bank (A): Retail Branches and Customer Profitability Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Profitability Branch 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 Profitability Branch is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Infinity Bank (A): Retail Branches and Customer Profitability Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Infinity Bank (A): Retail Branches and Customer Profitability 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.
Successful track record of launching new products
– Profitability Branch has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Profitability Branch 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.
High switching costs
– The high switching costs that Profitability Branch 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.
Highly skilled collaborators
– Profitability Branch 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 Infinity Bank (A): Retail Branches and Customer Profitability HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Profitability Branch has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Profitability Branch to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Profitability Branch is one of the leading recruiters in the industry. Managers in the Infinity Bank (A): Retail Branches and Customer Profitability are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Profitability Branch is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Infinity Bank (A): Retail Branches and Customer Profitability | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Infinity Bank (A): Retail Branches and Customer Profitability are -
Low market penetration in new markets
– Outside its home market of Profitability Branch, firm in the HBR case study Infinity Bank (A): Retail Branches and Customer Profitability needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Profitability Branch is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Profitability Branch needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Profitability Branch to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Profitability Branch 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 Infinity Bank (A): Retail Branches and Customer Profitability 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 Profitability Branch has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Infinity Bank (A): Retail Branches and Customer Profitability, is just above the industry average. Profitability Branch 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 strategic competitive environment developments
– As Infinity Bank (A): Retail Branches and Customer Profitability HBR case study mentions - Profitability Branch 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.
Need for greater diversity
– Profitability Branch 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Profitability Branch 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.
Products dominated business model
– Even though Profitability Branch 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 - Infinity Bank (A): Retail Branches and Customer Profitability should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Infinity Bank (A): Retail Branches and Customer Profitability, in the dynamic environment Profitability Branch has struggled to respond to the nimble upstart competition. Profitability Branch has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study Infinity Bank (A): Retail Branches and Customer Profitability, 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.
Opportunities Infinity Bank (A): Retail Branches and Customer Profitability | 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 Infinity Bank (A): Retail Branches and Customer Profitability are -
Buying journey improvements
– Profitability Branch can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Infinity Bank (A): Retail Branches and Customer Profitability 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.
Better consumer reach
– The expansion of the 5G network will help Profitability Branch to increase its market reach. Profitability Branch 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.
Developing new processes and practices
– Profitability Branch 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.
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. Profitability Branch 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. Profitability Branch 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 Profitability Branch 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.
Creating value in data economy
– The success of analytics program of Profitability Branch has opened avenues for new revenue streams for the organization in the industry. This can help Profitability Branch to build a more holistic ecosystem as suggested in the Infinity Bank (A): Retail Branches and Customer Profitability case study. Profitability Branch can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Profitability Branch 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.
Manufacturing automation
– Profitability Branch 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Profitability Branch 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Profitability Branch can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Profitability Branch in the consumer business. Now Profitability Branch can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Profitability Branch to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Profitability Branch to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Profitability Branch 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.
Threats Infinity Bank (A): Retail Branches and Customer Profitability External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Infinity Bank (A): Retail Branches and Customer Profitability are -
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 Infinity Bank (A): Retail Branches and Customer Profitability, Profitability Branch 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Profitability Branch 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 Infinity Bank (A): Retail Branches and Customer Profitability .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Profitability Branch with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Profitability Branch 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.
Environmental challenges
– Profitability Branch 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. Profitability Branch can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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. Profitability Branch can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Profitability Branch is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Profitability Branch in the Finance & Accounting sector and impact the bottomline of the organization.
Increasing wage structure of Profitability Branch
– 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 Profitability Branch.
Stagnating economy with rate increase
– Profitability Branch 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.
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 Profitability Branch.
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. Profitability Branch needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Infinity Bank (A): Retail Branches and Customer Profitability 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 Infinity Bank (A): Retail Branches and Customer Profitability 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 Infinity Bank (A): Retail Branches and Customer Profitability 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 Infinity Bank (A): Retail Branches and Customer Profitability 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 Infinity Bank (A): Retail Branches and Customer Profitability 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 Profitability Branch needs to make to build a sustainable competitive advantage.
