Managing the U.S. Dollar in the 1980s SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Managing the U.S. Dollar in the 1980s
Provides numerical data and alternative explanations concerning the U.S. dollar's rise and subsequent fall in value from 1981 through 1987. Students are challenged to study the evidence and make their own inferences concerning the dollar's movements and the degree of its mispricing. Introduces students to competing theories of exchange rate determination and the analysis of macroeconomic data pertinent to the pricing of foreign exchange.
Swot Analysis of "Managing the U.S. Dollar in the 1980s" written by W. Carl Kester, Richard P. Melnick includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dollar's Inferences facing as an external strategic factors. Some of the topics covered in Managing the U.S. Dollar in the 1980s case study are - Strategic Management Strategies, Economics, Financial markets, International business, Pricing and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Managing the U.S. Dollar in the 1980s casestudy better are - – technology disruption, increasing commodity prices, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings,
challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Managing the U.S. Dollar in the 1980s
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Managing the U.S. Dollar in the 1980s case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dollar's Inferences, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dollar's Inferences 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 Managing the U.S. Dollar in the 1980s can be done for the following purposes –
1. Strategic planning using facts provided in Managing the U.S. Dollar in the 1980s case study
2. Improving business portfolio management of Dollar's Inferences
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 Dollar's Inferences
Strengths Managing the U.S. Dollar in the 1980s | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dollar's Inferences in Managing the U.S. Dollar in the 1980s Harvard Business Review case study are -
Strong track record of project management
– Dollar's Inferences is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High brand equity
– Dollar's Inferences has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dollar's Inferences to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the Managing the U.S. Dollar in the 1980s 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Managing the U.S. Dollar in the 1980s firm has clearly differentiated products in the market place. This has enabled Dollar's Inferences to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Dollar's Inferences to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Dollar's Inferences 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 Managing the U.S. Dollar in the 1980s HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Dollar's Inferences has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Managing the U.S. Dollar in the 1980s 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.
Successful track record of launching new products
– Dollar's Inferences has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Dollar's Inferences 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.
Analytics focus
– Dollar's Inferences 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 W. Carl Kester, Richard P. Melnick 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.
Cross disciplinary teams
– Horizontal connected teams at the Dollar's Inferences 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.
Ability to recruit top talent
– Dollar's Inferences is one of the leading recruiters in the industry. Managers in the Managing the U.S. Dollar in the 1980s are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Dollar's Inferences is one of the most innovative firm in sector. Manager in Managing the U.S. Dollar in the 1980s Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Dollar's Inferences
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Dollar's Inferences does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Managing the U.S. Dollar in the 1980s | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Managing the U.S. Dollar in the 1980s are -
Skills based hiring
– The stress on hiring functional specialists at Dollar's Inferences 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 Managing the U.S. Dollar in the 1980s, 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.
Need for greater diversity
– Dollar's Inferences 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.
Low market penetration in new markets
– Outside its home market of Dollar's Inferences, firm in the HBR case study Managing the U.S. Dollar in the 1980s needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Dollar's Inferences 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 - Managing the U.S. Dollar in the 1980s should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Managing the U.S. Dollar in the 1980s, in the dynamic environment Dollar's Inferences has struggled to respond to the nimble upstart competition. Dollar's Inferences has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, W. Carl Kester, Richard P. Melnick suggests that, Dollar's Inferences 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.
Interest costs
– Compare to the competition, Dollar's Inferences 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Dollar's Inferences is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Managing the U.S. Dollar in the 1980s can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Dollar's Inferences has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Managing the U.S. Dollar in the 1980s 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 Dollar's Inferences has relatively successful track record of launching new products.
Opportunities Managing the U.S. Dollar in the 1980s | 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 Managing the U.S. Dollar in the 1980s 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 Dollar's Inferences in the consumer business. Now Dollar's Inferences can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Dollar's Inferences 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 Managing the U.S. Dollar in the 1980s - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dollar's Inferences to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Dollar's Inferences 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
– Dollar's Inferences 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Dollar's Inferences 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.
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 Dollar's Inferences 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.
Building a culture of innovation
– managers at Dollar's Inferences 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.
Creating value in data economy
– The success of analytics program of Dollar's Inferences has opened avenues for new revenue streams for the organization in the industry. This can help Dollar's Inferences to build a more holistic ecosystem as suggested in the Managing the U.S. Dollar in the 1980s case study. Dollar's Inferences can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Dollar's Inferences to increase its market reach. Dollar's Inferences 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Dollar's Inferences is facing challenges because of the dominance of functional experts in the organization. Managing the U.S. Dollar in the 1980s 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Dollar's Inferences can use these opportunities to build new business models that can help the communities that Dollar's Inferences operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Loyalty marketing
– Dollar's Inferences has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Manufacturing automation
– Dollar's Inferences 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.
Threats Managing the U.S. Dollar in the 1980s External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Managing the U.S. Dollar in the 1980s are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Dollar's Inferences will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Managing the U.S. Dollar in the 1980s, Dollar's Inferences 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 .
Consumer confidence and its impact on Dollar's Inferences 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
– Dollar's Inferences 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.
Increasing wage structure of Dollar's Inferences
– 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 Dollar's Inferences.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dollar's Inferences 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.
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 Dollar's Inferences in the Finance & Accounting sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Dollar's Inferences 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.
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 Dollar's Inferences business can come under increasing regulations regarding data privacy, data security, etc.
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. Dollar's Inferences can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Dollar's Inferences 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. Dollar's Inferences can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Regulatory challenges
– Dollar's Inferences 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 Managing the U.S. Dollar in the 1980s 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 Managing the U.S. Dollar in the 1980s 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 Managing the U.S. Dollar in the 1980s 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 Managing the U.S. Dollar in the 1980s 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 Managing the U.S. Dollar in the 1980s 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 Dollar's Inferences needs to make to build a sustainable competitive advantage.
