Should Your Firm Invest in Cyber Risk Insurance? SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Should Your Firm Invest in Cyber Risk Insurance?
Firms have increasingly been turning to cyber risk insurance in order to better manage cyber threats and any resulting legal liability from data breaches. But how useful is this tactic? Herein, I analyze the impact of cyber attacks on firms, some of the applicable U.S. law shaping private sector responses to data breaches, and the extent to which cyber risk insurance helps mitigate the cyber threat. Ultimately, I argue that firms must take a proactive stance toward managing cyber attacks-not only for their wellbeing, but also to enhance overall cybersecurity and help secure critical national infrastructure.
Swot Analysis of "Should Your Firm Invest in Cyber Risk Insurance?" written by Scott J Shackelford includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cyber Breaches facing as an external strategic factors. Some of the topics covered in Should Your Firm Invest in Cyber Risk Insurance? case study are - Strategic Management Strategies, Risk management and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Should Your Firm Invest in Cyber Risk Insurance? casestudy better are - – there is backlash against globalization, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models,
increasing commodity prices, technology disruption, etc
Introduction to SWOT Analysis of Should Your Firm Invest in Cyber Risk Insurance?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Should Your Firm Invest in Cyber Risk Insurance? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cyber Breaches, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cyber Breaches 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 Should Your Firm Invest in Cyber Risk Insurance? can be done for the following purposes –
1. Strategic planning using facts provided in Should Your Firm Invest in Cyber Risk Insurance? case study
2. Improving business portfolio management of Cyber Breaches
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Cyber Breaches
Strengths Should Your Firm Invest in Cyber Risk Insurance? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cyber Breaches in Should Your Firm Invest in Cyber Risk Insurance? Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Cyber Breaches in the sector have low bargaining power. Should Your Firm Invest in Cyber Risk Insurance? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cyber Breaches to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Cyber Breaches 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 Should Your Firm Invest in Cyber Risk Insurance? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Cyber Breaches has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Cyber Breaches to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Cyber Breaches is one of the most innovative firm in sector. Manager in Should Your Firm Invest in Cyber Risk Insurance? Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Cyber Breaches is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Cyber Breaches has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cyber Breaches 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.
Learning organization
- Cyber Breaches 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 Cyber Breaches is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Should Your Firm Invest in Cyber Risk Insurance? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Should Your Firm Invest in Cyber Risk Insurance? 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.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Cyber Breaches digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cyber Breaches 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.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Should Your Firm Invest in Cyber Risk Insurance? firm has clearly differentiated products in the market place. This has enabled Cyber Breaches to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Cyber Breaches to invest into research and development (R&D) and innovation.
Organizational Resilience of Cyber Breaches
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cyber Breaches does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Cyber Breaches is one of the leading recruiters in the industry. Managers in the Should Your Firm Invest in Cyber Risk Insurance? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Should Your Firm Invest in Cyber Risk Insurance? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Should Your Firm Invest in Cyber Risk Insurance? are -
Need for greater diversity
– Cyber Breaches 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.
Slow to strategic competitive environment developments
– As Should Your Firm Invest in Cyber Risk Insurance? HBR case study mentions - Cyber Breaches 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.
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 Cyber Breaches supply chain. Even after few cautionary changes mentioned in the HBR case study - Should Your Firm Invest in Cyber Risk Insurance?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cyber Breaches vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Cyber Breaches 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 - Should Your Firm Invest in Cyber Risk Insurance? should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Should Your Firm Invest in Cyber Risk Insurance?, in the dynamic environment Cyber Breaches has struggled to respond to the nimble upstart competition. Cyber Breaches has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Cyber Breaches 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Should Your Firm Invest in Cyber Risk Insurance?, it seems that the employees of Cyber Breaches 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, Cyber Breaches 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 Should Your Firm Invest in Cyber Risk Insurance? 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 Should Your Firm Invest in Cyber Risk Insurance? can leverage the sales team experience to cultivate customer relationships as Cyber Breaches is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cyber Breaches is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Should Your Firm Invest in Cyber Risk Insurance? can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Cyber Breaches 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.
Opportunities Should Your Firm Invest in Cyber Risk Insurance? | 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 Should Your Firm Invest in Cyber Risk Insurance? 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 Cyber Breaches 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.
Developing new processes and practices
– Cyber Breaches can develop new processes and procedures in Innovation & Entrepreneurship 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.
Manufacturing automation
– Cyber Breaches can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship 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.
Buying journey improvements
– Cyber Breaches can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Should Your Firm Invest in Cyber Risk Insurance? 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Cyber Breaches can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cyber Breaches 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 Cyber Breaches to hire the very best people irrespective of their geographical location.
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. Cyber Breaches 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 Cyber Breaches to increase its market reach. Cyber Breaches 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.
Leveraging digital technologies
– Cyber Breaches 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.
Building a culture of innovation
– managers at Cyber Breaches 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 Innovation & Entrepreneurship segment.
Learning at scale
– Online learning technologies has now opened space for Cyber Breaches 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.
Creating value in data economy
– The success of analytics program of Cyber Breaches has opened avenues for new revenue streams for the organization in the industry. This can help Cyber Breaches to build a more holistic ecosystem as suggested in the Should Your Firm Invest in Cyber Risk Insurance? case study. Cyber Breaches can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cyber Breaches can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Should Your Firm Invest in Cyber Risk Insurance? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Should Your Firm Invest in Cyber Risk Insurance? are -
Consumer confidence and its impact on Cyber Breaches 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.
Stagnating economy with rate increase
– Cyber Breaches 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.
Regulatory challenges
– Cyber Breaches 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 Innovation & Entrepreneurship industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cyber Breaches in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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 Cyber Breaches in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Environmental challenges
– Cyber Breaches 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. Cyber Breaches can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Cyber Breaches business can come under increasing regulations regarding data privacy, data security, etc.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Cyber Breaches.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cyber Breaches 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 Should Your Firm Invest in Cyber Risk Insurance? .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cyber Breaches with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Should Your Firm Invest in Cyber Risk Insurance?, Cyber Breaches may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
Shortening product life cycle
– it is one of the major threat that Cyber Breaches is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Should Your Firm Invest in Cyber Risk Insurance? 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 Should Your Firm Invest in Cyber Risk Insurance? 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 Should Your Firm Invest in Cyber Risk Insurance? 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 Should Your Firm Invest in Cyber Risk Insurance? 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 Should Your Firm Invest in Cyber Risk Insurance? 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 Cyber Breaches needs to make to build a sustainable competitive advantage.
