Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version
The Royal Bank of Canada uses customer relationship management and customer profitability tools to gain a competitive advantage in Canada's increasingly crowded financial services market. The case presents two pricing and customer management issues: one from the point of view of the vice president of customer relationship marketing and the other from a line manager's perspective.
Swot Analysis of "Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version" written by V.G. Narayanan, Lisa Brem includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Customer Relationship facing as an external strategic factors. Some of the topics covered in Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version case study are - Strategic Management Strategies, Collaboration, Competition, Competitive strategy, Customers, Government, Pricing and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, increasing commodity prices,
geopolitical disruptions, wage bills are increasing, etc
Introduction to SWOT Analysis of Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Customer Relationship, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Customer Relationship 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version case study
2. Improving business portfolio management of Customer Relationship
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 Customer Relationship
Strengths Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Customer Relationship in Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version Harvard Business Review case study are -
Ability to lead change in Finance & Accounting field
– Customer Relationship 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 Customer Relationship in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Customer Relationship 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 Customer Relationship is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Customer Relationship
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Customer Relationship does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Customer Relationship 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 V.G. Narayanan, Lisa Brem 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.
High switching costs
– The high switching costs that Customer Relationship 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 Customer Relationship in the sector have low bargaining power. Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Customer Relationship to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Customer Relationship is one of the most innovative firm in sector. Manager in Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Customer Relationship 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.
Successful track record of launching new products
– Customer Relationship has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Customer Relationship 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.
Highly skilled collaborators
– Customer Relationship 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Customer Relationship has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version 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.
Operational resilience
– The operational resilience strategy in the Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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.
Weaknesses Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version are -
Low market penetration in new markets
– Outside its home market of Customer Relationship, firm in the HBR case study Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Customer Relationship products
– To increase the profitability and margins on the products, Customer Relationship needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Customer Relationship 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.
Interest costs
– Compare to the competition, Customer Relationship 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version, is just above the industry average. Customer Relationship 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.
Skills based hiring
– The stress on hiring functional specialists at Customer Relationship 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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 Customer Relationship has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Customer Relationship 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. Customer Relationship 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.
Slow to strategic competitive environment developments
– As Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version HBR case study mentions - Customer Relationship takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Aligning sales with marketing
– It come across in the case study Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version can leverage the sales team experience to cultivate customer relationships as Customer Relationship is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version, it seems that the employees of Customer Relationship 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.
Opportunities Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version are -
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 Customer Relationship 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.
Creating value in data economy
– The success of analytics program of Customer Relationship has opened avenues for new revenue streams for the organization in the industry. This can help Customer Relationship to build a more holistic ecosystem as suggested in the Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version case study. Customer Relationship can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Customer Relationship 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
– Customer Relationship 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.
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. Customer Relationship can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Customer Relationship to increase its market reach. Customer Relationship 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 Customer Relationship 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 Customer Relationship can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Customer Relationship 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Customer Relationship is facing challenges because of the dominance of functional experts in the organization. Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version 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.
Building a culture of innovation
– managers at Customer Relationship can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Using analytics as competitive advantage
– Customer Relationship 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Customer Relationship to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Customer Relationship 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, Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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.
Threats Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Customer Relationship 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version .
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. Customer Relationship 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.
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. Customer Relationship can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Customer Relationship in the Finance & Accounting sector and impact the bottomline 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish Version, Customer Relationship 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 .
Stagnating economy with rate increase
– Customer Relationship 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.
High dependence on third party suppliers
– Customer Relationship 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.
Consumer confidence and its impact on Customer Relationship 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.
Regulatory challenges
– Customer Relationship needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Finance & Accounting industry regulations.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Customer Relationship.
Technology acceleration in Forth Industrial Revolution
– Customer Relationship has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Customer Relationship 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.
Environmental challenges
– Customer Relationship 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. Customer Relationship can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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 Customer Profitability and Customer Relationship Management at RBC Financial Group (Abridged), Spanish 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 Customer Relationship needs to make to build a sustainable competitive advantage.
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