Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger
When local governments face budget pressures, one approach is to regionalize services-that is, to seek out greater economies of scale by consolidating service delivery with other municipalities. This case describes the effort of two small (though well-heeled) Massachusetts towns to explore a police merger during the financial recession of 2009. The towns of Hamilton and Wenham, located north of Boston in the "North Shore" area, had, in the past, successfully consolidated school systems, libraries, recreation departments, and more. By some calculations, the towns stood to save a significant amount of money by merging police forces. Ultimately, however, they decided against it. The case includes partly conflicting data from several studies that estimate the financial impact of a police merger. Case number 1988.0
Swot Analysis of "Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger" written by David King, Pamela Varley includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Towns Police facing as an external strategic factors. Some of the topics covered in Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger case study are - Strategic Management Strategies, Government, Mergers & acquisitions and Global Business.
Some of the macro environment factors that can be used to understand the Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger casestudy better are - – increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, wage bills are increasing, technology disruption, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels,
increasing transportation and logistics costs, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Towns Police, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Towns Police 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 Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger can be done for the following purposes –
1. Strategic planning using facts provided in Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger case study
2. Improving business portfolio management of Towns Police
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Towns Police
Strengths Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Towns Police in Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger Harvard Business Review case study are -
Sustainable margins compare to other players in Global Business industry
– Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger firm has clearly differentiated products in the market place. This has enabled Towns Police to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Towns Police to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Towns Police has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Towns Police 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.
Strong track record of project management
– Towns Police is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Towns Police in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Towns Police 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.
Low bargaining power of suppliers
– Suppliers of Towns Police in the sector have low bargaining power. Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Towns Police to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Towns Police has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Towns Police to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger 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.
High switching costs
– The high switching costs that Towns Police 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
– Towns Police 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 Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Towns Police has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Towns Police 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 Towns Police is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger, is just above the industry average. Towns Police needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High bargaining power of channel partners
– Because of the regulatory requirements, David King, Pamela Varley suggests that, Towns Police 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.
Products dominated business model
– Even though Towns Police 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 - Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Towns Police 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.
Capital Spending Reduction
– Even during the low interest decade, Towns Police 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.
Low market penetration in new markets
– Outside its home market of Towns Police, firm in the HBR case study Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Towns Police is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Towns Police 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.
Increasing silos among functional specialists
– The organizational structure of Towns Police is dominated by functional specialists. It is not different from other players in the Global Business segment. Towns Police needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Towns Police to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Towns Police has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Towns Police even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger, in the dynamic environment Towns Police has struggled to respond to the nimble upstart competition. Towns Police has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger | 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 Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Towns Police can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Towns Police 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, Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Towns Police can use the latest technology developments to improve its manufacturing and designing process in Global Business segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Towns Police in the consumer business. Now Towns Police can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Towns Police can develop new processes and procedures in Global Business 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.
Building a culture of innovation
– managers at Towns Police 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 Global Business segment.
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 Towns Police 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.
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. Towns Police can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Towns Police in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Towns Police to increase its market reach. Towns Police 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.
Learning at scale
– Online learning technologies has now opened space for Towns Police 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Towns Police 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. Towns Police 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.
Creating value in data economy
– The success of analytics program of Towns Police has opened avenues for new revenue streams for the organization in the industry. This can help Towns Police to build a more holistic ecosystem as suggested in the Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger case study. Towns Police can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger are -
Environmental challenges
– Towns Police 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. Towns Police can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Regulatory challenges
– Towns Police 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 Global Business industry regulations.
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 Towns Police business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Towns Police in the Global Business industry. The Global Business 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 Towns Police in the Global Business sector and impact the bottomline of the organization.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger, Towns Police may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Towns Police with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Towns Police can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Towns Police demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Towns Police needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Stagnating economy with rate increase
– Towns Police 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.
Weighted SWOT Analysis of Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger 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 Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger 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 Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger 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 Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger 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 Cutting Costs in Financial Hard Times: Two Massachusetts Towns Consider a Police Merger 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 Towns Police needs to make to build a sustainable competitive advantage.
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