Case Study Description of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies
Set in 2003, this case presents the relative merits and demerits of direct and indirect methods of international property investment from the perspective of an Australian property company, LandLease (Asia) Property Ltd. (LL). It wished to gain exposure to the Hong Kong property sector and had the option of investing directly by acquiring real property assets or indirectly by acquiring interests in investment vehicles whose underlying investment performance was linked to the property sectors. LL was particularly interested in creating an investment portfolio and listing it as a REIT in Hong Kong. Compares and contrasts the most common forms and strategies of real estate investment. The relative attractiveness of direct and indirect international property investments will depend on the requirements, objectives, and financial strength of the investors. Despite differences in the underlying asset base and quality, direct and indirect investments are not mutually exclusive.
Swot Analysis of "LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies" written by Frederik Pretorius, Mary Ho includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Property Landlease facing as an external strategic factors. Some of the topics covered in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study are - Strategic Management Strategies, International business and Finance & Accounting.
Some of the macro environment factors that can be used to understand the LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, technology disruption, central banks are concerned over increasing inflation, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , increasing transportation and logistics costs,
increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Property Landlease, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Property Landlease 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 LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies can be done for the following purposes –
1. Strategic planning using facts provided in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study
2. Improving business portfolio management of Property Landlease
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 Property Landlease
Strengths LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Property Landlease in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies Harvard Business Review case study are -
Innovation driven organization
– Property Landlease is one of the most innovative firm in sector. Manager in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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
– Property Landlease is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Property Landlease 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 Frederik Pretorius, Mary Ho 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.
Sustainable margins compare to other players in Finance & Accounting industry
– LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies firm has clearly differentiated products in the market place. This has enabled Property Landlease to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Property Landlease to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Property Landlease has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Property Landlease 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.
Ability to recruit top talent
– Property Landlease is one of the leading recruiters in the industry. Managers in the LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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
- Property Landlease 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 Property Landlease is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Property Landlease
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Property Landlease does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Property Landlease 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
– Property Landlease 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 LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Property Landlease 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Property Landlease digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Property Landlease 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.
Weaknesses LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies are -
Interest costs
– Compare to the competition, Property Landlease 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies, it seems that the employees of Property Landlease 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, Property Landlease 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Property Landlease is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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
– Property Landlease 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.
Products dominated business model
– Even though Property Landlease 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 - LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies, 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.
Lack of clear differentiation of Property Landlease products
– To increase the profitability and margins on the products, Property Landlease needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Property Landlease has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High operating costs
– Compare to the competitors, firm in the HBR case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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 Property Landlease 's lucrative customers.
Increasing silos among functional specialists
– The organizational structure of Property Landlease is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Property Landlease needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Property Landlease to focus more on services rather than just following the product oriented approach.
Opportunities LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies | 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 LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies are -
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 Property Landlease in the consumer business. Now Property Landlease can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Property Landlease to increase its market reach. Property Landlease 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.
Manufacturing automation
– Property Landlease 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Property Landlease 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Property Landlease 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.
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. Property Landlease 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. Property Landlease 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.
Leveraging digital technologies
– Property Landlease 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.
Developing new processes and practices
– Property Landlease 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.
Creating value in data economy
– The success of analytics program of Property Landlease has opened avenues for new revenue streams for the organization in the industry. This can help Property Landlease to build a more holistic ecosystem as suggested in the LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies case study. Property Landlease can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Property Landlease 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Property Landlease 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 Property Landlease to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Property Landlease 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.
Buying journey improvements
– Property Landlease can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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.
Threats LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Property Landlease with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Property Landlease 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.
Shortening product life cycle
– it is one of the major threat that Property Landlease 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, Property Landlease 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 LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Property Landlease 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.
Technology acceleration in Forth Industrial Revolution
– Property Landlease has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Property Landlease 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.
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 Property Landlease.
Consumer confidence and its impact on Property Landlease 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.
Environmental challenges
– Property Landlease 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. Property Landlease 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. Property Landlease 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.
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 Property Landlease in the Finance & Accounting sector and impact the bottomline of the organization.
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 Property Landlease business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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 LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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 LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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 LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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 LandLease (Asia) Property Limited: Redefining Real Estate Investment Strategies 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 Property Landlease needs to make to build a sustainable competitive advantage.
