Omar Selim: Building a Values-Based Asset Management Firm (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Omar Selim: Building a Values-Based Asset Management Firm (B)
The case describes the decision of Omar Selim to set up Arabesque as an independent organization and how he organized Arabesque to use both financial and environmental, social and governance (ESG) data in order to deliver performance for its clients. Supplement to case 115021.
Authors :: George Serafeim, Rebecca Henderson, Shannon Gombos
Swot Analysis of "Omar Selim: Building a Values-Based Asset Management Firm (B)" written by George Serafeim, Rebecca Henderson, Shannon Gombos includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Arabesque Selim facing as an external strategic factors. Some of the topics covered in Omar Selim: Building a Values-Based Asset Management Firm (B) case study are - Strategic Management Strategies, Financial management, Leadership, Social enterprise, Sustainability and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Omar Selim: Building a Values-Based Asset Management Firm (B) casestudy better are - – talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion,
central banks are concerned over increasing inflation, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Omar Selim: Building a Values-Based Asset Management Firm (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Omar Selim: Building a Values-Based Asset Management Firm (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Arabesque Selim, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Arabesque Selim 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 Omar Selim: Building a Values-Based Asset Management Firm (B) can be done for the following purposes –
1. Strategic planning using facts provided in Omar Selim: Building a Values-Based Asset Management Firm (B) case study
2. Improving business portfolio management of Arabesque Selim
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 Arabesque Selim
Strengths Omar Selim: Building a Values-Based Asset Management Firm (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Arabesque Selim in Omar Selim: Building a Values-Based Asset Management Firm (B) Harvard Business Review case study are -
Training and development
– Arabesque Selim has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Omar Selim: Building a Values-Based Asset Management Firm (B) 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.
Strong track record of project management
– Arabesque Selim is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Arabesque Selim 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 Omar Selim: Building a Values-Based Asset Management Firm (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Arabesque Selim has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Arabesque Selim 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Omar Selim: Building a Values-Based Asset Management Firm (B) firm has clearly differentiated products in the market place. This has enabled Arabesque Selim to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Arabesque Selim to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Arabesque Selim in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– Arabesque Selim 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 George Serafeim, Rebecca Henderson, Shannon Gombos 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.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Arabesque Selim digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Arabesque Selim 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.
High switching costs
– The high switching costs that Arabesque Selim 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.
Cross disciplinary teams
– Horizontal connected teams at the Arabesque Selim 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.
High brand equity
– Arabesque Selim has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Arabesque Selim to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the Omar Selim: Building a Values-Based Asset Management Firm (B) 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.
Weaknesses Omar Selim: Building a Values-Based Asset Management Firm (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Omar Selim: Building a Values-Based Asset Management Firm (B) are -
Capital Spending Reduction
– Even during the low interest decade, Arabesque Selim 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 existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Arabesque Selim supply chain. Even after few cautionary changes mentioned in the HBR case study - Omar Selim: Building a Values-Based Asset Management Firm (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Arabesque Selim vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Arabesque Selim 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Omar Selim: Building a Values-Based Asset Management Firm (B), in the dynamic environment Arabesque Selim has struggled to respond to the nimble upstart competition. Arabesque Selim has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Arabesque Selim 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.
Skills based hiring
– The stress on hiring functional specialists at Arabesque Selim 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.
No frontier risks strategy
– After analyzing the HBR case study Omar Selim: Building a Values-Based Asset Management Firm (B), 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 Arabesque Selim products
– To increase the profitability and margins on the products, Arabesque Selim needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Omar Selim: Building a Values-Based Asset Management Firm (B) HBR case study mentions - Arabesque Selim 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 Arabesque Selim is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Arabesque Selim needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Arabesque Selim to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Arabesque Selim 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.
Opportunities Omar Selim: Building a Values-Based Asset Management Firm (B) | 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 Omar Selim: Building a Values-Based Asset Management Firm (B) are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Arabesque Selim 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.
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. Arabesque Selim can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Arabesque Selim can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Arabesque Selim in the consumer business. Now Arabesque Selim can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Arabesque Selim is facing challenges because of the dominance of functional experts in the organization. Omar Selim: Building a Values-Based Asset Management Firm (B) 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.
Manufacturing automation
– Arabesque Selim 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.
Creating value in data economy
– The success of analytics program of Arabesque Selim has opened avenues for new revenue streams for the organization in the industry. This can help Arabesque Selim to build a more holistic ecosystem as suggested in the Omar Selim: Building a Values-Based Asset Management Firm (B) case study. Arabesque Selim can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Arabesque Selim 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Arabesque Selim can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Omar Selim: Building a Values-Based Asset Management Firm (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Arabesque Selim can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Using analytics as competitive advantage
– Arabesque Selim 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 Omar Selim: Building a Values-Based Asset Management Firm (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Arabesque Selim to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Arabesque Selim 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. Arabesque Selim 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.
Learning at scale
– Online learning technologies has now opened space for Arabesque Selim 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.
Threats Omar Selim: Building a Values-Based Asset Management Firm (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Omar Selim: Building a Values-Based Asset Management Firm (B) are -
Shortening product life cycle
– it is one of the major threat that Arabesque Selim is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Omar Selim: Building a Values-Based Asset Management Firm (B), Arabesque Selim 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Arabesque Selim with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Arabesque Selim business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Arabesque Selim has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Arabesque Selim 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.
Increasing wage structure of Arabesque Selim
– 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 Arabesque Selim.
Stagnating economy with rate increase
– Arabesque Selim 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.
Regulatory challenges
– Arabesque Selim 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.
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 Arabesque Selim.
Consumer confidence and its impact on Arabesque Selim 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.
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. Arabesque Selim can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Arabesque Selim 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.
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 Arabesque Selim in the Finance & Accounting sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Omar Selim: Building a Values-Based Asset Management Firm (B) 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 Omar Selim: Building a Values-Based Asset Management Firm (B) 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 Omar Selim: Building a Values-Based Asset Management Firm (B) 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 Omar Selim: Building a Values-Based Asset Management Firm (B) 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 Omar Selim: Building a Values-Based Asset Management Firm (B) 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 Arabesque Selim needs to make to build a sustainable competitive advantage.