The Federal Reserve and the Banking Crisis of 1931 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Federal Reserve and the Banking Crisis of 1931
In early October 1931, in the midst of a global economic depression, the U.S. banking system was in crisis - - with bank suspensions running at near record levels. At the same time, the broader economy was sputtering, and U.S. gold reserves had come under severe pressure after Britain abandoned its gold standard in mid-September. As pressure continued to mount, the leaders of the Federal Reserve faced several critical decisions. Should they adjust interest rates? Was abandoning the gold standard an acceptable option? Should they lend more freely to the nation's commercial banks? Or would this only ensure the sorts of financial excess that had gotten the country into trouble in the first place? Was it time to give in to the mounting pressure, or to hold firm?
Swot Analysis of "The Federal Reserve and the Banking Crisis of 1931" written by David A. Moss, Cole Bolton includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that 1931 Gold facing as an external strategic factors. Some of the topics covered in The Federal Reserve and the Banking Crisis of 1931 case study are - Strategic Management Strategies, Crisis management, Decision making, Government, Recession and Finance & Accounting.
Some of the macro environment factors that can be used to understand the The Federal Reserve and the Banking Crisis of 1931 casestudy better are - – increasing energy prices, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, technology disruption,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, etc
Introduction to SWOT Analysis of The Federal Reserve and the Banking Crisis of 1931
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Federal Reserve and the Banking Crisis of 1931 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the 1931 Gold, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which 1931 Gold 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 The Federal Reserve and the Banking Crisis of 1931 can be done for the following purposes –
1. Strategic planning using facts provided in The Federal Reserve and the Banking Crisis of 1931 case study
2. Improving business portfolio management of 1931 Gold
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 1931 Gold
Strengths The Federal Reserve and the Banking Crisis of 1931 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of 1931 Gold in The Federal Reserve and the Banking Crisis of 1931 Harvard Business Review case study are -
Ability to recruit top talent
– 1931 Gold is one of the leading recruiters in the industry. Managers in the The Federal Reserve and the Banking Crisis of 1931 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Finance & Accounting industry
– The Federal Reserve and the Banking Crisis of 1931 firm has clearly differentiated products in the market place. This has enabled 1931 Gold to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped 1931 Gold to invest into research and development (R&D) and innovation.
Innovation driven organization
– 1931 Gold is one of the most innovative firm in sector. Manager in The Federal Reserve and the Banking Crisis of 1931 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- 1931 Gold 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 1931 Gold is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Federal Reserve and the Banking Crisis of 1931 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– 1931 Gold 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
– 1931 Gold has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled 1931 Gold to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– 1931 Gold 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 The Federal Reserve and the Banking Crisis of 1931 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For 1931 Gold digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. 1931 Gold 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.
Cross disciplinary teams
– Horizontal connected teams at the 1931 Gold 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.
Diverse revenue streams
– 1931 Gold is present in almost all the verticals within the industry. This has provided firm in The Federal Reserve and the Banking Crisis of 1931 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.
Analytics focus
– 1931 Gold 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 David A. Moss, Cole Bolton 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.
Training and development
– 1931 Gold has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Federal Reserve and the Banking Crisis of 1931 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.
Weaknesses The Federal Reserve and the Banking Crisis of 1931 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Federal Reserve and the Banking Crisis of 1931 are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Federal Reserve and the Banking Crisis of 1931, it seems that the employees of 1931 Gold 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.
Capital Spending Reduction
– Even during the low interest decade, 1931 Gold 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 1931 Gold, firm in the HBR case study The Federal Reserve and the Banking Crisis of 1931 needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Federal Reserve and the Banking Crisis of 1931, in the dynamic environment 1931 Gold has struggled to respond to the nimble upstart competition. 1931 Gold has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, 1931 Gold is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Federal Reserve and the Banking Crisis of 1931 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners
– Because of the regulatory requirements, David A. Moss, Cole Bolton suggests that, 1931 Gold 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.
High cash cycle compare to competitors
1931 Gold has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow decision making process
– As mentioned earlier in the report, 1931 Gold 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. 1931 Gold 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.
Products dominated business model
– Even though 1931 Gold 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 - The Federal Reserve and the Banking Crisis of 1931 should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– 1931 Gold 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.
Lack of clear differentiation of 1931 Gold products
– To increase the profitability and margins on the products, 1931 Gold needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities The Federal Reserve and the Banking Crisis of 1931 | 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 The Federal Reserve and the Banking Crisis of 1931 are -
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. 1931 Gold can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– 1931 Gold 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.
Loyalty marketing
– 1931 Gold 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.
Using analytics as competitive advantage
– 1931 Gold 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 The Federal Reserve and the Banking Crisis of 1931 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help 1931 Gold to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of 1931 Gold has opened avenues for new revenue streams for the organization in the industry. This can help 1931 Gold to build a more holistic ecosystem as suggested in the The Federal Reserve and the Banking Crisis of 1931 case study. 1931 Gold can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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, 1931 Gold can use these opportunities to build new business models that can help the communities that 1931 Gold operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Learning at scale
– Online learning technologies has now opened space for 1931 Gold 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
– 1931 Gold 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.
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. 1931 Gold 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. 1931 Gold 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.
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. 1931 Gold can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 1931 Gold 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, 1931 Gold 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, The Federal Reserve and the Banking Crisis of 1931, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, 1931 Gold 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.
Threats The Federal Reserve and the Banking Crisis of 1931 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Federal Reserve and the Banking Crisis of 1931 are -
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 1931 Gold in the Finance & Accounting sector and impact the bottomline of the organization.
Environmental challenges
– 1931 Gold 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. 1931 Gold can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Consumer confidence and its impact on 1931 Gold 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, 1931 Gold can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study The Federal Reserve and the Banking Crisis of 1931 .
Shortening product life cycle
– it is one of the major threat that 1931 Gold is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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. 1931 Gold 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.
Stagnating economy with rate increase
– 1931 Gold 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.
Technology acceleration in Forth Industrial Revolution
– 1931 Gold has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, 1931 Gold needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of 1931 Gold.
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.
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. 1931 Gold can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of 1931 Gold
– 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 1931 Gold.
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.
Weighted SWOT Analysis of The Federal Reserve and the Banking Crisis of 1931 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 The Federal Reserve and the Banking Crisis of 1931 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 The Federal Reserve and the Banking Crisis of 1931 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 The Federal Reserve and the Banking Crisis of 1931 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 The Federal Reserve and the Banking Crisis of 1931 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 1931 Gold needs to make to build a sustainable competitive advantage.