The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation
This technical note offers an example of a thoroughly complete "pitch book" for use as a basis of class discussion and learning. Actual pitch books are almost never made available for public use. This presentation, however, was prepared by a group of Darden students in April 2001 for a jury of M&A executives of United Technologies Corporation-they judged this work to be of excellent quality, among the best they had seen in any setting. A separate validation of the deal concept is given in the final exhibit, which records the ammouncement on July 30, 2001, by General Electric of its acquisition of Heller. In reviewing this document, the task for the student is to assess both its form and contents, from the standpoints of both the presenter and audience. Why is each exhibit and section included in the document? What analytical work underpins the exhibits? What might explain the presentation format? What oral comments might one make in supporting this presentation to a group of executives?
Swot Analysis of "The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation" written by Robert F. Bruner includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Heller Pitch facing as an external strategic factors. Some of the topics covered in The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation case study are - Strategic Management Strategies, Financial management, Mergers & acquisitions and Finance & Accounting.
Some of the macro environment factors that can be used to understand the The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation casestudy better are - – challanges to central banks by blockchain based private currencies, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, increasing household debt because of falling income levels,
digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Heller Pitch, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Heller Pitch 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation can be done for the following purposes –
1. Strategic planning using facts provided in The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation case study
2. Improving business portfolio management of Heller Pitch
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 Heller Pitch
Strengths The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Heller Pitch in The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation Harvard Business Review case study are -
High brand equity
– Heller Pitch has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Heller Pitch to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Heller Pitch in the sector have low bargaining power. The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Heller Pitch to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Finance & Accounting industry
– The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation firm has clearly differentiated products in the market place. This has enabled Heller Pitch to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Heller Pitch to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Heller Pitch is present in almost all the verticals within the industry. This has provided firm in The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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.
Effective Research and Development (R&D)
– Heller Pitch 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Heller Pitch is one of the most innovative firm in sector. Manager in The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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 Heller Pitch 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
– Heller Pitch has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Heller Pitch 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
– Heller Pitch 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 The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Heller Pitch digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Heller Pitch 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.
Ability to recruit top talent
– Heller Pitch is one of the leading recruiters in the industry. Managers in the The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Heller Pitch is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation, it seems that the employees of Heller Pitch 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Robert F. Bruner suggests that, Heller Pitch 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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 Heller Pitch has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Heller Pitch 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.
Low market penetration in new markets
– Outside its home market of Heller Pitch, firm in the HBR case study The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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 The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation can leverage the sales team experience to cultivate customer relationships as Heller Pitch is planning to shift buying processes online.
Need for greater diversity
– Heller Pitch 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.
Products dominated business model
– Even though Heller Pitch 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Heller Pitch is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Heller Pitch needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Heller Pitch to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Heller Pitch 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Heller Pitch is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation | 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Heller Pitch 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 Heller Pitch to hire the very best people irrespective of their geographical location.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Heller Pitch in the consumer business. Now Heller Pitch can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Heller Pitch is facing challenges because of the dominance of functional experts in the organization. The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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.
Better consumer reach
– The expansion of the 5G network will help Heller Pitch to increase its market reach. Heller Pitch 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.
Loyalty marketing
– Heller Pitch 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Heller Pitch 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.
Manufacturing automation
– Heller Pitch 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.
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 Heller Pitch 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
– Heller Pitch 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, Heller Pitch can use these opportunities to build new business models that can help the communities that Heller Pitch operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Heller Pitch can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Heller Pitch 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. Heller Pitch 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Heller Pitch 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation, 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 The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation are -
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.
Environmental challenges
– Heller Pitch 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. Heller Pitch can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Technology acceleration in Forth Industrial Revolution
– Heller Pitch has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Heller Pitch 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.
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. Heller Pitch 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.
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 Heller Pitch.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation, Heller Pitch 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 .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Heller Pitch needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
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. Heller Pitch can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Heller Pitch 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 Heller Pitch 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Heller Pitch with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Heller Pitch
– 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 Heller Pitch.
Regulatory challenges
– Heller Pitch 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.
Weighted SWOT Analysis of The M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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 M&A "Pitch Book": Proposed Acquisition of Heller Financial by United Technologies Corporation 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 Heller Pitch needs to make to build a sustainable competitive advantage.
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