Washington Mutual (A): A Very Old Bank Can Grow-A Lot! SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Washington Mutual (A): A Very Old Bank Can Grow-A Lot!
Describes the ways in which Washington Mutual preserved and reinforced its brand through two phases of expansion, the first based on acquisition and the second on organic growth. The Washington Mutual brand is shown to be grounded in a well designed customer experience. This experience was the result of careful attention by Washington Mutual to hiring policies for its staff, incentives that encouraged entrepreneurship, empowerment of both "store" managers and "sales associates," and a strong culture that valued the community, innovation, fairness in treatment of customers, care for its employees, and high-speed implementation.
Swot Analysis of "Washington Mutual (A): A Very Old Bank Can Grow-A Lot!" written by Robert D. Dewar, Hayagreeva Rao includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Washington Mutual facing as an external strategic factors. Some of the topics covered in Washington Mutual (A): A Very Old Bank Can Grow-A Lot! case study are - Strategic Management Strategies, Compensation, Customer service, Human resource management, Organizational culture, Strategy and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Washington Mutual (A): A Very Old Bank Can Grow-A Lot! casestudy better are - – wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization, increasing transportation and logistics costs, central banks are concerned over increasing inflation, technology disruption, digital marketing is dominated by two big players Facebook and Google,
increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Washington Mutual (A): A Very Old Bank Can Grow-A Lot!
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Washington Mutual (A): A Very Old Bank Can Grow-A Lot! case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Washington Mutual, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Washington Mutual 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 Washington Mutual (A): A Very Old Bank Can Grow-A Lot! can be done for the following purposes –
1. Strategic planning using facts provided in Washington Mutual (A): A Very Old Bank Can Grow-A Lot! case study
2. Improving business portfolio management of Washington Mutual
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Washington Mutual
Strengths Washington Mutual (A): A Very Old Bank Can Grow-A Lot! | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Washington Mutual in Washington Mutual (A): A Very Old Bank Can Grow-A Lot! Harvard Business Review case study are -
Learning organization
- Washington Mutual 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 Washington Mutual is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Washington Mutual (A): A Very Old Bank Can Grow-A Lot! Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Washington Mutual in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Washington Mutual is one of the leading recruiters in the industry. Managers in the Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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
– Washington Mutual is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Washington Mutual digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Washington Mutual 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.
Low bargaining power of suppliers
– Suppliers of Washington Mutual in the sector have low bargaining power. Washington Mutual (A): A Very Old Bank Can Grow-A Lot! has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Washington Mutual to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Washington Mutual 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 Washington Mutual (A): A Very Old Bank Can Grow-A Lot! - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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.
High brand equity
– Washington Mutual has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Washington Mutual to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Leadership & Managing People field
– Washington Mutual 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 Washington Mutual in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Washington Mutual is present in almost all the verticals within the industry. This has provided firm in Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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.
Successful track record of launching new products
– Washington Mutual has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Washington Mutual 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.
Weaknesses Washington Mutual (A): A Very Old Bank Can Grow-A Lot! | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Washington Mutual (A): A Very Old Bank Can Grow-A Lot! are -
Slow to strategic competitive environment developments
– As Washington Mutual (A): A Very Old Bank Can Grow-A Lot! HBR case study mentions - Washington Mutual 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Washington Mutual (A): A Very Old Bank Can Grow-A Lot!, is just above the industry average. Washington Mutual 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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 Washington Mutual has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Washington Mutual 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. Washington Mutual 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Washington Mutual (A): A Very Old Bank Can Grow-A Lot!, it seems that the employees of Washington Mutual 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.
Interest costs
– Compare to the competition, Washington Mutual 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.
Skills based hiring
– The stress on hiring functional specialists at Washington Mutual 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 cash cycle compare to competitors
Washington Mutual 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.
No frontier risks strategy
– After analyzing the HBR case study Washington Mutual (A): A Very Old Bank Can Grow-A Lot!, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Increasing silos among functional specialists
– The organizational structure of Washington Mutual is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Washington Mutual needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Washington Mutual to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Washington Mutual 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.
Opportunities Washington Mutual (A): A Very Old Bank Can Grow-A Lot! | 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 Washington Mutual (A): A Very Old Bank Can Grow-A Lot! are -
Developing new processes and practices
– Washington Mutual can develop new processes and procedures in Leadership & Managing People 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, Washington Mutual can use these opportunities to build new business models that can help the communities that Washington Mutual operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Creating value in data economy
– The success of analytics program of Washington Mutual has opened avenues for new revenue streams for the organization in the industry. This can help Washington Mutual to build a more holistic ecosystem as suggested in the Washington Mutual (A): A Very Old Bank Can Grow-A Lot! case study. Washington Mutual can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Washington Mutual 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.
Buying journey improvements
– Washington Mutual can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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.
Better consumer reach
– The expansion of the 5G network will help Washington Mutual to increase its market reach. Washington Mutual 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.
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 Washington Mutual 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
– Washington Mutual can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Washington Mutual 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. Washington Mutual can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Washington Mutual can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Washington Mutual 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, Washington Mutual (A): A Very Old Bank Can Grow-A Lot!, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Washington Mutual 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.
Loyalty marketing
– Washington Mutual 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.
Threats Washington Mutual (A): A Very Old Bank Can Grow-A Lot! External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Washington Mutual (A): A Very Old Bank Can Grow-A Lot! are -
Environmental challenges
– Washington Mutual 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. Washington Mutual can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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 Washington Mutual.
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.
Shortening product life cycle
– it is one of the major threat that Washington Mutual is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Washington Mutual needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Washington Mutual can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Washington Mutual in the Leadership & Managing People industry. The Leadership & Managing People 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.
Regulatory challenges
– Washington Mutual 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 Leadership & Managing People industry regulations.
Stagnating economy with rate increase
– Washington Mutual 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Washington Mutual (A): A Very Old Bank Can Grow-A Lot!, Washington Mutual may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
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.
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 Washington Mutual in the Leadership & Managing People sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Washington Mutual has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Washington Mutual needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Weighted SWOT Analysis of Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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 Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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 Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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 Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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 Washington Mutual (A): A Very Old Bank Can Grow-A Lot! 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 Washington Mutual needs to make to build a sustainable competitive advantage.
