Brink's Company: Activists push for a spin-off SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Brink's Company: Activists push for a spin-off
The case studies the decision of the security services corporation Brink's Company to spin-off its home security division from the rest of the company. The decision followed intense pressure on the company by three activist hedge funds who felt that Brink's was chronically undervalued and the individual businesses were worth more than the combined company. The company resisted the decision for over a year before agreeing to the break up. The case follows the argument made by the company and each of the investors. It also describes the actions by the company to convince its shareholders of the merits of keeping the company together, as well as the actions the activist investors took to get the attention of management, the board, and other investors. The businesses, secure transportation and home security monitoring, are described from both a business strategy and a financial perspective so that the potential value of different value enhancing options can be analyzed.
Swot Analysis of "Brink's Company: Activists push for a spin-off" written by Suraj Srinivasan, Aldo Sesia, Amy Kaser includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Brink's Security facing as an external strategic factors. Some of the topics covered in Brink's Company: Activists push for a spin-off case study are - Strategic Management Strategies, Financial management and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Brink's Company: Activists push for a spin-off casestudy better are - – increasing transportation and logistics costs, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic ,
geopolitical disruptions, technology disruption, etc
Introduction to SWOT Analysis of Brink's Company: Activists push for a spin-off
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Brink's Company: Activists push for a spin-off case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Brink's Security, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Brink's Security 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 Brink's Company: Activists push for a spin-off can be done for the following purposes –
1. Strategic planning using facts provided in Brink's Company: Activists push for a spin-off case study
2. Improving business portfolio management of Brink's Security
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 Brink's Security
Strengths Brink's Company: Activists push for a spin-off | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Brink's Security in Brink's Company: Activists push for a spin-off Harvard Business Review case study are -
Diverse revenue streams
– Brink's Security is present in almost all the verticals within the industry. This has provided firm in Brink's Company: Activists push for a spin-off 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.
Low bargaining power of suppliers
– Suppliers of Brink's Security in the sector have low bargaining power. Brink's Company: Activists push for a spin-off has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Brink's Security to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Brink's Security has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Brink's Security to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Finance & Accounting industry
– Brink's Company: Activists push for a spin-off firm has clearly differentiated products in the market place. This has enabled Brink's Security to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Brink's Security to invest into research and development (R&D) and innovation.
Organizational Resilience of Brink's Security
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Brink's Security does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Brink's Security is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Brink's Company: Activists push for a spin-off 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.
Ability to recruit top talent
– Brink's Security is one of the leading recruiters in the industry. Managers in the Brink's Company: Activists push for a spin-off 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 Brink's Security digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Brink's Security 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.
Training and development
– Brink's Security has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Brink's Company: Activists push for a spin-off 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.
Learning organization
- Brink's Security 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 Brink's Security is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Brink's Company: Activists push for a spin-off Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Finance & Accounting field
– Brink's Security 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 Brink's Security in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Brink's Company: Activists push for a spin-off | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Brink's Company: Activists push for a spin-off are -
Slow to strategic competitive environment developments
– As Brink's Company: Activists push for a spin-off HBR case study mentions - Brink's Security 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Brink's Company: Activists push for a spin-off, in the dynamic environment Brink's Security has struggled to respond to the nimble upstart competition. Brink's Security has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Brink's Security 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.
Aligning sales with marketing
– It come across in the case study Brink's Company: Activists push for a spin-off 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 Brink's Company: Activists push for a spin-off can leverage the sales team experience to cultivate customer relationships as Brink's Security is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Brink's Company: Activists push for a spin-off has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Brink's Security 's lucrative customers.
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 Brink's Security supply chain. Even after few cautionary changes mentioned in the HBR case study - Brink's Company: Activists push for a spin-off, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Brink's Security vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Brink's Security 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.
Interest costs
– Compare to the competition, Brink's Security 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, Brink's Security is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Brink's Company: Activists push for a spin-off can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Brink's Security 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. Brink's Security 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Suraj Srinivasan, Aldo Sesia, Amy Kaser suggests that, Brink's Security 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.
Opportunities Brink's Company: Activists push for a spin-off | 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 Brink's Company: Activists push for a spin-off are -
Better consumer reach
– The expansion of the 5G network will help Brink's Security to increase its market reach. Brink's Security 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.
Creating value in data economy
– The success of analytics program of Brink's Security has opened avenues for new revenue streams for the organization in the industry. This can help Brink's Security to build a more holistic ecosystem as suggested in the Brink's Company: Activists push for a spin-off case study. Brink's Security can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Brink's Security can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Brink's Company: Activists push for a spin-off 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.
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 Brink's Security 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.
Leveraging digital technologies
– Brink's Security 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Brink's Security in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Manufacturing automation
– Brink's Security 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.
Learning at scale
– Online learning technologies has now opened space for Brink's Security 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Brink's Security to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Brink's Security to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Brink's Security is facing challenges because of the dominance of functional experts in the organization. Brink's Company: Activists push for a spin-off 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.
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. Brink's Security 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. Brink's Security 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.
Developing new processes and practices
– Brink's Security 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Brink's Security can use these opportunities to build new business models that can help the communities that Brink's Security operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Threats Brink's Company: Activists push for a spin-off External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Brink's Company: Activists push for a spin-off are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Brink's Security 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.
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.
Regulatory challenges
– Brink's Security 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.
High dependence on third party suppliers
– Brink's Security 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Brink's Company: Activists push for a spin-off, Brink's Security 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 .
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. Brink's Security can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Brink's Security has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Brink's Security 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 Brink's Security.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Brink's Security 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 Brink's Company: Activists push for a spin-off .
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 Brink's Security in the Finance & Accounting sector and impact the bottomline of the organization.
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. Brink's Security 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
– Brink's Security 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.
Shortening product life cycle
– it is one of the major threat that Brink's Security is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Brink's Company: Activists push for a spin-off 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 Brink's Company: Activists push for a spin-off 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 Brink's Company: Activists push for a spin-off 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 Brink's Company: Activists push for a spin-off 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 Brink's Company: Activists push for a spin-off 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 Brink's Security needs to make to build a sustainable competitive advantage.