Northrop vs. TRW, Portuguese Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Northrop vs. TRW, Portuguese Version
TRW, a leading supplier of advanced technology products for the auto, defense, and aerospace markets, receives an unexpected stock-for-stock offer from defense company Northrop Grumman Corp. The $11.4 billion aggregate offer, which represents a 22% premium over the average trading price for the previous 12 months, comes just two days after TRW's CEO has, without notice, resigned. TRW's board is faced with a difficult decision on which they vote in a few days: Should they "just say no," rejecting the offer out of hand? Should they negotiate a friendly deal with Northrop? Or should they put TRW in so-called "Revlon mode" and auction the company to the highest bidder? This case, grounded in the specifics of Ohio's strict antitaker laws, explores defensive tactics, hostile tender offers, the duties of the board, and fixed-price exchange. It is for use in an advanced course on mergers and acquisitions.
Swot Analysis of "Northrop vs. TRW, Portuguese Version" written by Carliss Y. Baldwin, James Quinn includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Northrop Trw facing as an external strategic factors. Some of the topics covered in Northrop vs. TRW, Portuguese Version case study are - Strategic Management Strategies, Financial analysis, Financial management, Financial markets, Mergers & acquisitions, Negotiations, Regulation and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Northrop vs. TRW, Portuguese Version casestudy better are - – increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, technology disruption, increasing transportation and logistics costs, cloud computing is disrupting traditional business models, there is backlash against globalization, increasing government debt because of Covid-19 spendings,
increasing commodity prices, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Northrop vs. TRW, Portuguese Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Northrop vs. TRW, Portuguese Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Northrop Trw, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Northrop Trw 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 Northrop vs. TRW, Portuguese Version can be done for the following purposes –
1. Strategic planning using facts provided in Northrop vs. TRW, Portuguese Version case study
2. Improving business portfolio management of Northrop Trw
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 Northrop Trw
Strengths Northrop vs. TRW, Portuguese Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Northrop Trw in Northrop vs. TRW, Portuguese Version Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Northrop vs. TRW, Portuguese Version 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.
Learning organization
- Northrop Trw 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 Northrop Trw is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Northrop vs. TRW, Portuguese Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Finance & Accounting field
– Northrop Trw 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 Northrop Trw in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Northrop Trw is one of the leading recruiters in the industry. Managers in the Northrop vs. TRW, Portuguese Version are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Northrop Trw digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Northrop Trw 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 Northrop Trw 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.
Low bargaining power of suppliers
– Suppliers of Northrop Trw in the sector have low bargaining power. Northrop vs. TRW, Portuguese Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Northrop Trw to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Northrop Trw has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Northrop Trw 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.
Diverse revenue streams
– Northrop Trw is present in almost all the verticals within the industry. This has provided firm in Northrop vs. TRW, Portuguese Version case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Organizational Resilience of Northrop Trw
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Northrop Trw does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Northrop Trw 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
– Northrop Trw has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Northrop Trw to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Northrop vs. TRW, Portuguese Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Northrop vs. TRW, Portuguese Version are -
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 Northrop Trw supply chain. Even after few cautionary changes mentioned in the HBR case study - Northrop vs. TRW, Portuguese Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Northrop Trw vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Northrop vs. TRW, Portuguese Version, in the dynamic environment Northrop Trw has struggled to respond to the nimble upstart competition. Northrop Trw has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Northrop vs. TRW, Portuguese Version, it seems that the employees of Northrop Trw 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.
Products dominated business model
– Even though Northrop Trw 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 - Northrop vs. TRW, Portuguese Version should strive to include more intangible value offerings along with its core products and services.
Interest costs
– Compare to the competition, Northrop Trw 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, Northrop Trw is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Northrop vs. TRW, Portuguese Version can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– After analyzing the HBR case study Northrop vs. TRW, Portuguese Version, 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Northrop vs. TRW, Portuguese Version 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 Northrop Trw has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Carliss Y. Baldwin, James Quinn suggests that, Northrop Trw 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.
Need for greater diversity
– Northrop Trw 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 Northrop Trw, firm in the HBR case study Northrop vs. TRW, Portuguese Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Northrop vs. TRW, Portuguese Version | 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 Northrop vs. TRW, Portuguese Version are -
Using analytics as competitive advantage
– Northrop Trw 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 Northrop vs. TRW, Portuguese Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Northrop Trw 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. Northrop Trw 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. Northrop Trw 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.
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 Northrop Trw in the consumer business. Now Northrop Trw can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Northrop Trw has opened avenues for new revenue streams for the organization in the industry. This can help Northrop Trw to build a more holistic ecosystem as suggested in the Northrop vs. TRW, Portuguese Version case study. Northrop Trw can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Northrop Trw can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Northrop Trw 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.
Building a culture of innovation
– managers at Northrop Trw 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Northrop Trw 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, Northrop vs. TRW, Portuguese Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Northrop Trw 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Northrop Trw can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Northrop Trw can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Northrop vs. TRW, Portuguese Version 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.
Better consumer reach
– The expansion of the 5G network will help Northrop Trw to increase its market reach. Northrop Trw 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
– Northrop Trw 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.
Threats Northrop vs. TRW, Portuguese Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Northrop vs. TRW, Portuguese Version are -
Consumer confidence and its impact on Northrop Trw 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.
Shortening product life cycle
– it is one of the major threat that Northrop Trw is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Northrop Trw.
Technology acceleration in Forth Industrial Revolution
– Northrop Trw has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Northrop Trw 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.
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 Northrop Trw in the Finance & Accounting sector and impact the bottomline of the organization.
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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Northrop Trw 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.
Increasing wage structure of Northrop Trw
– 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 Northrop Trw.
Environmental challenges
– Northrop Trw 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. Northrop Trw can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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 Northrop Trw business can come under increasing regulations regarding data privacy, data security, etc.
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. Northrop Trw 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.
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. Northrop Trw needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Northrop vs. TRW, Portuguese Version 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 Northrop vs. TRW, Portuguese Version 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 Northrop vs. TRW, Portuguese Version 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 Northrop vs. TRW, Portuguese Version 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 Northrop vs. TRW, Portuguese Version 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 Northrop Trw needs to make to build a sustainable competitive advantage.
