High Wire Act: Credit Suisse and Contingent Capital (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of High Wire Act: Credit Suisse and Contingent Capital (A)
Late in 2010, Credit Suisse CEO Brady Dougan and his team closed in on the decision of whether or not to issue contingent capital, which Swiss regulators would require by 2019. There were a number of substantial issues facing Dougan and his team, including whether contingent capital would provide sufficient loss absorption when called upon, would there be sufficient demand for this new instrument, would it be cost effective capital, and what were the risks to Credit Suisse' reputation with clients and regulators if an issue did not go well? In addition, The Basel Committee, the body that recommended global bank capital standards, had decided that much of the existing bank "hybrid debt" would no longer count as capital for regulatory purposes, meaning banks would need to replace this portion of their equity accounts with some other form of capital. However, Basel had yet to decide whether contingent capital would be allowable in the new "Basel III" regulatory regime.
Swot Analysis of "High Wire Act: Credit Suisse and Contingent Capital (A)" written by Clayton Rose, Aldo Sesia includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Contingent Suisse facing as an external strategic factors. Some of the topics covered in High Wire Act: Credit Suisse and Contingent Capital (A) case study are - Strategic Management Strategies, Competitive strategy, Decision making, Financial markets, Leadership, Recession, Risk management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the High Wire Act: Credit Suisse and Contingent Capital (A) casestudy better are - – digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , increasing commodity prices, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions,
increasing energy prices, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of High Wire Act: Credit Suisse and Contingent Capital (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in High Wire Act: Credit Suisse and Contingent Capital (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Contingent Suisse, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Contingent Suisse 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 High Wire Act: Credit Suisse and Contingent Capital (A) can be done for the following purposes –
1. Strategic planning using facts provided in High Wire Act: Credit Suisse and Contingent Capital (A) case study
2. Improving business portfolio management of Contingent Suisse
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 Contingent Suisse
Strengths High Wire Act: Credit Suisse and Contingent Capital (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Contingent Suisse in High Wire Act: Credit Suisse and Contingent Capital (A) Harvard Business Review case study are -
Strong track record of project management
– Contingent Suisse is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Contingent Suisse has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in High Wire Act: Credit Suisse and Contingent Capital (A) 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.
Cross disciplinary teams
– Horizontal connected teams at the Contingent Suisse 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.
Diverse revenue streams
– Contingent Suisse is present in almost all the verticals within the industry. This has provided firm in High Wire Act: Credit Suisse and Contingent Capital (A) 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.
High brand equity
– Contingent Suisse has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Contingent Suisse to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Contingent Suisse is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Clayton Rose, Aldo Sesia can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Ability to recruit top talent
– Contingent Suisse is one of the leading recruiters in the industry. Managers in the High Wire Act: Credit Suisse and Contingent Capital (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Contingent Suisse is one of the most innovative firm in sector. Manager in High Wire Act: Credit Suisse and Contingent Capital (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Contingent Suisse in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Contingent Suisse has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Contingent Suisse 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
– Contingent Suisse 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 High Wire Act: Credit Suisse and Contingent Capital (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the High Wire Act: Credit Suisse and Contingent Capital (A) Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Weaknesses High Wire Act: Credit Suisse and Contingent Capital (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of High Wire Act: Credit Suisse and Contingent Capital (A) are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study High Wire Act: Credit Suisse and Contingent Capital (A), it seems that the employees of Contingent Suisse 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 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 Contingent Suisse supply chain. Even after few cautionary changes mentioned in the HBR case study - High Wire Act: Credit Suisse and Contingent Capital (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Contingent Suisse vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Clayton Rose, Aldo Sesia suggests that, Contingent Suisse 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.
Products dominated business model
– Even though Contingent Suisse 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 - High Wire Act: Credit Suisse and Contingent Capital (A) should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Contingent Suisse 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the High Wire Act: Credit Suisse and Contingent Capital (A) 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 Contingent Suisse has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Contingent Suisse is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study High Wire Act: Credit Suisse and Contingent Capital (A) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study High Wire Act: Credit Suisse and Contingent Capital (A), is just above the industry average. Contingent Suisse 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 cash cycle compare to competitors
Contingent Suisse 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.
Low market penetration in new markets
– Outside its home market of Contingent Suisse, firm in the HBR case study High Wire Act: Credit Suisse and Contingent Capital (A) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Contingent Suisse 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 High Wire Act: Credit Suisse and Contingent Capital (A) | 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 High Wire Act: Credit Suisse and Contingent Capital (A) are -
Learning at scale
– Online learning technologies has now opened space for Contingent Suisse 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.
Manufacturing automation
– Contingent Suisse can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People 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 Contingent Suisse 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.
Building a culture of innovation
– managers at Contingent Suisse 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 Leadership & Managing People segment.
Better consumer reach
– The expansion of the 5G network will help Contingent Suisse to increase its market reach. Contingent Suisse 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Contingent Suisse 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, High Wire Act: Credit Suisse and Contingent Capital (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Contingent Suisse can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Contingent Suisse 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.
Using analytics as competitive advantage
– Contingent Suisse has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study High Wire Act: Credit Suisse and Contingent Capital (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Contingent Suisse to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Contingent Suisse 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.
Creating value in data economy
– The success of analytics program of Contingent Suisse has opened avenues for new revenue streams for the organization in the industry. This can help Contingent Suisse to build a more holistic ecosystem as suggested in the High Wire Act: Credit Suisse and Contingent Capital (A) case study. Contingent Suisse can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Contingent Suisse in the consumer business. Now Contingent Suisse can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Contingent Suisse 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.
Threats High Wire Act: Credit Suisse and Contingent Capital (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study High Wire Act: Credit Suisse and Contingent Capital (A) are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Contingent Suisse 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 High Wire Act: Credit Suisse and Contingent Capital (A) .
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 Contingent Suisse in the Leadership & Managing People sector and impact the bottomline of the organization.
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.
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 Contingent Suisse 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 Contingent Suisse.
Increasing wage structure of Contingent Suisse
– 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 Contingent Suisse.
Technology acceleration in Forth Industrial Revolution
– Contingent Suisse has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Contingent Suisse 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.
Stagnating economy with rate increase
– Contingent Suisse 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.
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. Contingent Suisse 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
– Contingent Suisse 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.
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. Contingent Suisse 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.
Regulatory challenges
– Contingent Suisse 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Contingent Suisse with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of High Wire Act: Credit Suisse and Contingent Capital (A) 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 High Wire Act: Credit Suisse and Contingent Capital (A) 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 High Wire Act: Credit Suisse and Contingent Capital (A) 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 High Wire Act: Credit Suisse and Contingent Capital (A) 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 High Wire Act: Credit Suisse and Contingent Capital (A) 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 Contingent Suisse needs to make to build a sustainable competitive advantage.
