Case Study Description of SociA?tA? GA?nA?rale (A): The Rogue Trader
In January 2008, SociA?tA? GA?nA?rale, revealed that trader Jerome Kerviel had exposed the bank to 50 billion euros in apparently unhedged and unauthorized trades, resulting in 4.9 billion euros of losses when his positions were unwound. This case provides an opportunity to explore the motivations underlying Kerviel's conduct and the failure of the bank's internal controls, as well as other organizational and sociological factors in this incident and the broader 2008 financial crisis.
Swot Analysis of "SociA?tA? GA?nA?rale (A): The Rogue Trader" written by Mark Hunter, N. Craig Smith includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Rale Na facing as an external strategic factors. Some of the topics covered in SociA?tA? GA?nA?rale (A): The Rogue Trader case study are - Strategic Management Strategies, Financial management, Recession and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the SociA?tA? GA?nA?rale (A): The Rogue Trader casestudy better are - – digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, geopolitical disruptions, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , increasing transportation and logistics costs, there is backlash against globalization,
increasing household debt because of falling income levels, wage bills are increasing, etc
Introduction to SWOT Analysis of SociA?tA? GA?nA?rale (A): The Rogue Trader
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in SociA?tA? GA?nA?rale (A): The Rogue Trader case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Rale Na, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Rale Na 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 SociA?tA? GA?nA?rale (A): The Rogue Trader can be done for the following purposes –
1. Strategic planning using facts provided in SociA?tA? GA?nA?rale (A): The Rogue Trader case study
2. Improving business portfolio management of Rale Na
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 Rale Na
Strengths SociA?tA? GA?nA?rale (A): The Rogue Trader | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Rale Na in SociA?tA? GA?nA?rale (A): The Rogue Trader Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Rale Na 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.
High brand equity
– Rale Na has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Rale Na to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Rale Na is present in almost all the verticals within the industry. This has provided firm in SociA?tA? GA?nA?rale (A): The Rogue Trader 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Rale Na digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Rale Na 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.
Operational resilience
– The operational resilience strategy in the SociA?tA? GA?nA?rale (A): The Rogue Trader 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.
Organizational Resilience of Rale Na
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Rale Na does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Rale Na is one of the leading recruiters in the industry. Managers in the SociA?tA? GA?nA?rale (A): The Rogue Trader are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that Rale Na has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Strong track record of project management
– Rale Na is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Rale Na 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 Mark Hunter, N. Craig Smith 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– SociA?tA? GA?nA?rale (A): The Rogue Trader firm has clearly differentiated products in the market place. This has enabled Rale Na to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Rale Na to invest into research and development (R&D) and innovation.
Learning organization
- Rale Na 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 Rale Na is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in SociA?tA? GA?nA?rale (A): The Rogue Trader Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses SociA?tA? GA?nA?rale (A): The Rogue Trader | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of SociA?tA? GA?nA?rale (A): The Rogue Trader are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study SociA?tA? GA?nA?rale (A): The Rogue Trader, it seems that the employees of Rale Na 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, Mark Hunter, N. Craig Smith suggests that, Rale Na 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.
Skills based hiring
– The stress on hiring functional specialists at Rale Na 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.
No frontier risks strategy
– After analyzing the HBR case study SociA?tA? GA?nA?rale (A): The Rogue Trader, 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 Rale Na is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Rale Na needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Rale Na to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Rale Na 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.
High operating costs
– Compare to the competitors, firm in the HBR case study SociA?tA? GA?nA?rale (A): The Rogue Trader has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Rale Na 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Rale Na 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. Rale Na 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.
Low market penetration in new markets
– Outside its home market of Rale Na, firm in the HBR case study SociA?tA? GA?nA?rale (A): The Rogue Trader needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Rale Na 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 - SociA?tA? GA?nA?rale (A): The Rogue Trader 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, Rale Na 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 SociA?tA? GA?nA?rale (A): The Rogue Trader | 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 SociA?tA? GA?nA?rale (A): The Rogue Trader are -
Creating value in data economy
– The success of analytics program of Rale Na has opened avenues for new revenue streams for the organization in the industry. This can help Rale Na to build a more holistic ecosystem as suggested in the SociA?tA? GA?nA?rale (A): The Rogue Trader case study. Rale Na can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Rale Na can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Rale Na 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. Rale Na can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Developing new processes and practices
– Rale Na 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.
Loyalty marketing
– Rale Na 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.
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 Rale Na in the consumer business. Now Rale Na can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Rale Na 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.
Leveraging digital technologies
– Rale Na 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Rale Na is facing challenges because of the dominance of functional experts in the organization. SociA?tA? GA?nA?rale (A): The Rogue Trader 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 Rale Na to increase its market reach. Rale Na 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.
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. Rale Na can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Rale Na 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Rale Na 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, SociA?tA? GA?nA?rale (A): The Rogue Trader, 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 SociA?tA? GA?nA?rale (A): The Rogue Trader External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study SociA?tA? GA?nA?rale (A): The Rogue Trader are -
Regulatory challenges
– Rale Na 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.
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.
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 Rale Na.
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 Rale Na business can come under increasing regulations regarding data privacy, data security, etc.
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 Rale Na in the Leadership & Managing People sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Rale Na 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 SociA?tA? GA?nA?rale (A): The Rogue Trader .
Shortening product life cycle
– it is one of the major threat that Rale Na is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Rale Na 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. Rale Na can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Rale Na with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Rale Na has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Rale Na 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.
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. Rale Na needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Consumer confidence and its impact on Rale Na 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.
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.
Weighted SWOT Analysis of SociA?tA? GA?nA?rale (A): The Rogue Trader 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 SociA?tA? GA?nA?rale (A): The Rogue Trader 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 SociA?tA? GA?nA?rale (A): The Rogue Trader 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 SociA?tA? GA?nA?rale (A): The Rogue Trader 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 SociA?tA? GA?nA?rale (A): The Rogue Trader 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 Rale Na needs to make to build a sustainable competitive advantage.
