Nielsonlar Insurance: Replacing a Life Insurance Plan SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Nielsonlar Insurance: Replacing a Life Insurance Plan
In 2003, a financial planner in Calgary started working with the owner of Oilfield Welding Limited to provide employee benefits to the owner and his staff. Initially, the owner wanted to save for retirement by reinvesting all of his surplus earnings back into the business. However, he appreciated the potential creditor-proofing of life insurance and established a small retirement savings opportunity using life insurance. When Oilfield Welding Limited hired a new group administrator, the employee benefits program was put out to bid and the business was moved. Shortly thereafter, the financial planner was notified that the life insurance he had placed on the owner of Oilfield Welding Limited and his wife would be replaced by two new policies as recommended by another advisor. Would it be beneficial for the clients to replace their existing insurance? How should the financial planner proceed? Norma Nielson is affiliated with University of Calgary. Larry Wood is affiliated with University of Calgary.
Swot Analysis of "Nielsonlar Insurance: Replacing a Life Insurance Plan" written by Norma Nielson, Larry A. Wood includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Insurance Welding facing as an external strategic factors. Some of the topics covered in Nielsonlar Insurance: Replacing a Life Insurance Plan case study are - Strategic Management Strategies, Financial management, Personnel policies and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Nielsonlar Insurance: Replacing a Life Insurance Plan casestudy better are - – geopolitical disruptions, increasing commodity prices, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, increasing energy prices, digital marketing is dominated by two big players Facebook and Google,
increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Nielsonlar Insurance: Replacing a Life Insurance Plan
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Nielsonlar Insurance: Replacing a Life Insurance Plan case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Insurance Welding, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Insurance Welding 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 Nielsonlar Insurance: Replacing a Life Insurance Plan can be done for the following purposes –
1. Strategic planning using facts provided in Nielsonlar Insurance: Replacing a Life Insurance Plan case study
2. Improving business portfolio management of Insurance Welding
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 Insurance Welding
Strengths Nielsonlar Insurance: Replacing a Life Insurance Plan | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Insurance Welding in Nielsonlar Insurance: Replacing a Life Insurance Plan Harvard Business Review case study are -
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Insurance Welding digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Insurance Welding 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.
Learning organization
- Insurance Welding 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 Insurance Welding is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Nielsonlar Insurance: Replacing a Life Insurance Plan Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Insurance Welding 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
– Insurance Welding is one of the most innovative firm in sector. Manager in Nielsonlar Insurance: Replacing a Life Insurance Plan Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Insurance Welding is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Nielsonlar Insurance: Replacing a Life Insurance Plan 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.
Training and development
– Insurance Welding has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Nielsonlar Insurance: Replacing a Life Insurance Plan 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.
Cross disciplinary teams
– Horizontal connected teams at the Insurance Welding 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.
Diverse revenue streams
– Insurance Welding is present in almost all the verticals within the industry. This has provided firm in Nielsonlar Insurance: Replacing a Life Insurance Plan 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.
Organizational Resilience of Insurance Welding
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Insurance Welding does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Insurance Welding 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 Norma Nielson, Larry A. Wood can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Low bargaining power of suppliers
– Suppliers of Insurance Welding in the sector have low bargaining power. Nielsonlar Insurance: Replacing a Life Insurance Plan has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Insurance Welding to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Nielsonlar Insurance: Replacing a Life Insurance Plan | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nielsonlar Insurance: Replacing a Life Insurance Plan are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Nielsonlar Insurance: Replacing a Life Insurance Plan 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 Insurance Welding has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Nielsonlar Insurance: Replacing a Life Insurance Plan, in the dynamic environment Insurance Welding has struggled to respond to the nimble upstart competition. Insurance Welding has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Insurance Welding is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Nielsonlar Insurance: Replacing a Life Insurance Plan can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Insurance Welding is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Insurance Welding needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Insurance Welding to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Nielsonlar Insurance: Replacing a Life Insurance Plan, 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.
Products dominated business model
– Even though Insurance Welding 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 - Nielsonlar Insurance: Replacing a Life Insurance Plan should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Nielsonlar Insurance: Replacing a Life Insurance Plan, is just above the industry average. Insurance Welding 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Nielsonlar Insurance: Replacing a Life Insurance Plan, it seems that the employees of Insurance Welding 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.
Low market penetration in new markets
– Outside its home market of Insurance Welding, firm in the HBR case study Nielsonlar Insurance: Replacing a Life Insurance Plan needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study Nielsonlar Insurance: Replacing a Life Insurance Plan 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 Nielsonlar Insurance: Replacing a Life Insurance Plan can leverage the sales team experience to cultivate customer relationships as Insurance Welding is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Norma Nielson, Larry A. Wood suggests that, Insurance Welding 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.
Opportunities Nielsonlar Insurance: Replacing a Life Insurance Plan | 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 Nielsonlar Insurance: Replacing a Life Insurance Plan are -
Creating value in data economy
– The success of analytics program of Insurance Welding has opened avenues for new revenue streams for the organization in the industry. This can help Insurance Welding to build a more holistic ecosystem as suggested in the Nielsonlar Insurance: Replacing a Life Insurance Plan case study. Insurance Welding can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Insurance Welding 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.
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 Insurance Welding 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.
Better consumer reach
– The expansion of the 5G network will help Insurance Welding to increase its market reach. Insurance Welding 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.
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 Insurance Welding in the consumer business. Now Insurance Welding can target international markets with far fewer capital restrictions requirements than the existing system.
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. Insurance Welding 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. Insurance Welding 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.
Manufacturing automation
– Insurance Welding 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Insurance Welding can use these opportunities to build new business models that can help the communities that Insurance Welding operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Leveraging digital technologies
– Insurance Welding 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.
Loyalty marketing
– Insurance Welding 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.
Using analytics as competitive advantage
– Insurance Welding 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 Nielsonlar Insurance: Replacing a Life Insurance Plan - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Insurance Welding to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Insurance Welding can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Insurance Welding can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Nielsonlar Insurance: Replacing a Life Insurance Plan External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Nielsonlar Insurance: Replacing a Life Insurance Plan are -
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.
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 Insurance Welding in the Finance & Accounting sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Insurance Welding with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Insurance Welding 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 Nielsonlar Insurance: Replacing a Life Insurance Plan .
Regulatory challenges
– Insurance Welding 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.
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. Insurance Welding can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Insurance Welding has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Insurance Welding 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.
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.
Consumer confidence and its impact on Insurance Welding 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.
Stagnating economy with rate increase
– Insurance Welding 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Insurance Welding 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 Insurance Welding business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Insurance Welding 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. Insurance Welding can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Weighted SWOT Analysis of Nielsonlar Insurance: Replacing a Life Insurance Plan 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 Nielsonlar Insurance: Replacing a Life Insurance Plan 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 Nielsonlar Insurance: Replacing a Life Insurance Plan 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 Nielsonlar Insurance: Replacing a Life Insurance Plan 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 Nielsonlar Insurance: Replacing a Life Insurance Plan 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 Insurance Welding needs to make to build a sustainable competitive advantage.