Nephila Builds a Portfolio of Weather Risk Transfer Contracts SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Nephila Builds a Portfolio of Weather Risk Transfer Contracts
The weather team at Nephila Capital Ltd. (Nephila) was in the midst of the weather market's busy winter renewal period. The list of weather risk transfer contracts that needed to be analyzed and priced seemed to be growing by the minute, and one team member is devising a plan to price each deal on its own merits of risk/reward. The counterparty's bid would reflect the willingness of the contracting party to pay for a weather hedge, and none would pay more than the bid amount. Nephila wanted to meet the needs of each counterparty, but only if Nephila earned a requisite return on capital. If the bid amount were not high enough to be attractive to Nephila, the team would need to convey that news to the counterparties. Did these new deal opportunities offer something more to Nephila beyond their individual numbers?
Swot Analysis of "Nephila Builds a Portfolio of Weather Risk Transfer Contracts" written by Samuel E Bodily, D. Matthew Coleman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nephila Weather facing as an external strategic factors. Some of the topics covered in Nephila Builds a Portfolio of Weather Risk Transfer Contracts case study are - Strategic Management Strategies, Financial management, Financial markets, Negotiations, Risk management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Nephila Builds a Portfolio of Weather Risk Transfer Contracts casestudy better are - – challanges to central banks by blockchain based private currencies, increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings,
increasing energy prices, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Nephila Builds a Portfolio of Weather Risk Transfer Contracts
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Nephila Builds a Portfolio of Weather Risk Transfer Contracts case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nephila Weather, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nephila Weather 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 Nephila Builds a Portfolio of Weather Risk Transfer Contracts can be done for the following purposes –
1. Strategic planning using facts provided in Nephila Builds a Portfolio of Weather Risk Transfer Contracts case study
2. Improving business portfolio management of Nephila Weather
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 Nephila Weather
Strengths Nephila Builds a Portfolio of Weather Risk Transfer Contracts | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nephila Weather in Nephila Builds a Portfolio of Weather Risk Transfer Contracts Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Nephila Weather 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.
Training and development
– Nephila Weather has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Nephila Builds a Portfolio of Weather Risk Transfer Contracts firm has clearly differentiated products in the market place. This has enabled Nephila Weather to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Nephila Weather to invest into research and development (R&D) and innovation.
Strong track record of project management
– Nephila Weather 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 recruit top talent
– Nephila Weather is one of the leading recruiters in the industry. Managers in the Nephila Builds a Portfolio of Weather Risk Transfer Contracts are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Learning organization
- Nephila Weather 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 Nephila Weather is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Nephila Builds a Portfolio of Weather Risk Transfer Contracts Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Nephila Weather is present in almost all the verticals within the industry. This has provided firm in Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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.
High switching costs
– The high switching costs that Nephila Weather 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.
Ability to lead change in Finance & Accounting field
– Nephila Weather 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 Nephila Weather in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Nephila Weather in the sector have low bargaining power. Nephila Builds a Portfolio of Weather Risk Transfer Contracts has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Nephila Weather to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Nephila Weather has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nephila Weather 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 brand equity
– Nephila Weather has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Nephila Weather to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Nephila Builds a Portfolio of Weather Risk Transfer Contracts | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Nephila Builds a Portfolio of Weather Risk Transfer Contracts are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nephila Weather is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Nephila Builds a Portfolio of Weather Risk Transfer Contracts can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Nephila Weather 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.
Interest costs
– Compare to the competition, Nephila Weather 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.
Capital Spending Reduction
– Even during the low interest decade, Nephila Weather 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 operating costs
– Compare to the competitors, firm in the HBR case study Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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 Nephila Weather 's lucrative customers.
Products dominated business model
– Even though Nephila Weather 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 - Nephila Builds a Portfolio of Weather Risk Transfer Contracts should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Nephila Builds a Portfolio of Weather Risk Transfer Contracts, it seems that the employees of Nephila Weather 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Nephila Weather 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 Nephila Builds a Portfolio of Weather Risk Transfer Contracts HBR case study mentions - Nephila Weather 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.
Increasing silos among functional specialists
– The organizational structure of Nephila Weather is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Nephila Weather needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Nephila Weather to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Nephila Weather 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.
Opportunities Nephila Builds a Portfolio of Weather Risk Transfer Contracts | 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 Nephila Builds a Portfolio of Weather Risk Transfer Contracts are -
Better consumer reach
– The expansion of the 5G network will help Nephila Weather to increase its market reach. Nephila Weather 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
– Nephila Weather 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.
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. Nephila Weather can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Nephila Weather 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.
Manufacturing automation
– Nephila Weather 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.
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 Nephila Weather in the consumer business. Now Nephila Weather can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Nephila Weather can use these opportunities to build new business models that can help the communities that Nephila Weather operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Learning at scale
– Online learning technologies has now opened space for Nephila Weather 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.
Leveraging digital technologies
– Nephila Weather 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Nephila Weather can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Nephila Weather 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nephila Weather is facing challenges because of the dominance of functional experts in the organization. Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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.
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. Nephila Weather 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. Nephila Weather 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.
Threats Nephila Builds a Portfolio of Weather Risk Transfer Contracts External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Nephila Builds a Portfolio of Weather Risk Transfer Contracts are -
Consumer confidence and its impact on Nephila Weather 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.
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. Nephila Weather needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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 Nephila Weather in the Finance & Accounting sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Nephila Weather 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 Nephila Weather
– 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 Nephila Weather.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Nephila Weather with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Nephila Weather.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Nephila Weather 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 Nephila Builds a Portfolio of Weather Risk Transfer Contracts .
Technology acceleration in Forth Industrial Revolution
– Nephila Weather has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Nephila Weather 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nephila Weather 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.
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. Nephila Weather can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Regulatory challenges
– Nephila Weather 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.
Weighted SWOT Analysis of Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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 Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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 Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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 Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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 Nephila Builds a Portfolio of Weather Risk Transfer Contracts 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 Nephila Weather needs to make to build a sustainable competitive advantage.