Highbridge Capital Management: Building a Sustainable Organization SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Highbridge Capital Management: Building a Sustainable Organization
In 2010 Glenn Dubin reflected upon the enduring organization and culture he and co-founder Henry Swieca had infused into Highbridge Capital Management over the course of almost two decades. Since the firm's launch in 1992, New York-based Highbridge had grown to become a diversified investment platform comprising hedge funds, traditional asset management products, and credit and equity investments with longer-term holding periods. The company employed more than 315 people at offices in New York, London, Hong Kong and Tokyo, and managed $21 billion for prominent institutional investors, public and corporate pension funds, endowments, foundations and family offices. Highbridge was known by many on Wall Street as a "benchmark," largely due to the firm's investment performance and to the diversity and dynamism of the organization. Investors had come to rely on Highbridge's consistent returns and attention to risk management. The firm comprised a group of gifted, committed professionals as a result of Dubin's longtime focus on talent, nurturing a culture of collaboration, building a sophisticated risk management and technology platform, and maintaining a robust operating infrastructure. In 2009, J.P. Morgan completed its purchase of Highbridge-a strategic partnership the two organizations began in 2004 when J.P. Morgan Asset Management purchased a majority interest in the firm. In 2010, Dubin described his desired impact on the increasingly complex and sophisticated organization: "I hope that my legacy will be a bigger and more diversified Highbridge-but one that has the same culture and core principles of excellence, staffed with individuals with high integrity and an interest in successful collaboration. This is the only way I know to ensure that our initial goal of creating an organization that can outlive its founders will be achieved."
Authors :: Roderick M. Kramer, Michael Brimm, Victoria Chang, Julia Bator
Swot Analysis of "Highbridge Capital Management: Building a Sustainable Organization" written by Roderick M. Kramer, Michael Brimm, Victoria Chang, Julia Bator includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Highbridge Dubin facing as an external strategic factors. Some of the topics covered in Highbridge Capital Management: Building a Sustainable Organization case study are - Strategic Management Strategies, Entrepreneurial finance, Financial management, Leadership, Mergers & acquisitions, Organizational structure, Succession planning, Talent management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Highbridge Capital Management: Building a Sustainable Organization casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, increasing commodity prices,
talent flight as more people leaving formal jobs, wage bills are increasing, etc
Introduction to SWOT Analysis of Highbridge Capital Management: Building a Sustainable Organization
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Highbridge Capital Management: Building a Sustainable Organization case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Highbridge Dubin, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Highbridge Dubin 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 Highbridge Capital Management: Building a Sustainable Organization can be done for the following purposes –
1. Strategic planning using facts provided in Highbridge Capital Management: Building a Sustainable Organization case study
2. Improving business portfolio management of Highbridge Dubin
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 Highbridge Dubin
Strengths Highbridge Capital Management: Building a Sustainable Organization | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Highbridge Dubin in Highbridge Capital Management: Building a Sustainable Organization Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Highbridge Dubin in the sector have low bargaining power. Highbridge Capital Management: Building a Sustainable Organization has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Highbridge Dubin to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Highbridge Capital Management: Building a Sustainable Organization 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
– Highbridge Dubin has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Highbridge Dubin to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Highbridge Dubin
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Highbridge Dubin does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Leadership & Managing People field
– Highbridge Dubin 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 Highbridge Dubin in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Highbridge Dubin 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 Highbridge Capital Management: Building a Sustainable Organization - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Highbridge Dubin 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.
Highly skilled collaborators
– Highbridge Dubin 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 Highbridge Capital Management: Building a Sustainable Organization HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Highbridge Dubin 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Highbridge Dubin digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Highbridge Dubin 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.
Analytics focus
– Highbridge Dubin 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 Roderick M. Kramer, Michael Brimm, Victoria Chang, Julia Bator 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.
Training and development
– Highbridge Dubin has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Highbridge Capital Management: Building a Sustainable Organization 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.
Weaknesses Highbridge Capital Management: Building a Sustainable Organization | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Highbridge Capital Management: Building a Sustainable Organization are -
Aligning sales with marketing
– It come across in the case study Highbridge Capital Management: Building a Sustainable Organization 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 Highbridge Capital Management: Building a Sustainable Organization can leverage the sales team experience to cultivate customer relationships as Highbridge Dubin is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Highbridge Dubin 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Highbridge Dubin 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 bargaining power of channel partners
– Because of the regulatory requirements, Roderick M. Kramer, Michael Brimm, Victoria Chang, Julia Bator suggests that, Highbridge Dubin 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 operating costs
– Compare to the competitors, firm in the HBR case study Highbridge Capital Management: Building a Sustainable Organization 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 Highbridge Dubin 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Highbridge Dubin, firm in the HBR case study Highbridge Capital Management: Building a Sustainable Organization needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Highbridge Dubin 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.
Interest costs
– Compare to the competition, Highbridge Dubin 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.
Need for greater diversity
– Highbridge Dubin 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Highbridge Capital Management: Building a Sustainable Organization, is just above the industry average. Highbridge Dubin 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.
Slow decision making process
– As mentioned earlier in the report, Highbridge Dubin 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. Highbridge Dubin 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.
Opportunities Highbridge Capital Management: Building a Sustainable Organization | 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 Highbridge Capital Management: Building a Sustainable Organization are -
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. Highbridge Dubin 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. Highbridge Dubin 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Highbridge Dubin 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 Highbridge Dubin to hire the very best people irrespective of their geographical location.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Highbridge Dubin can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Highbridge Dubin can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Highbridge Dubin in the consumer business. Now Highbridge Dubin can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Highbridge Dubin 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Highbridge Dubin is facing challenges because of the dominance of functional experts in the organization. Highbridge Capital Management: Building a Sustainable Organization 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 Highbridge Dubin to increase its market reach. Highbridge Dubin 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.
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. Highbridge Dubin can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Highbridge Dubin 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Highbridge Dubin can use these opportunities to build new business models that can help the communities that Highbridge Dubin operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Highbridge Dubin 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, Highbridge Capital Management: Building a Sustainable Organization, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Highbridge Dubin has opened avenues for new revenue streams for the organization in the industry. This can help Highbridge Dubin to build a more holistic ecosystem as suggested in the Highbridge Capital Management: Building a Sustainable Organization case study. Highbridge Dubin can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Highbridge Capital Management: Building a Sustainable Organization External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Highbridge Capital Management: Building a Sustainable Organization are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Highbridge Dubin 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.
Environmental challenges
– Highbridge Dubin 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. Highbridge Dubin can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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. Highbridge Dubin 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.
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.
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. Highbridge Dubin needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Highbridge Capital Management: Building a Sustainable Organization, Highbridge Dubin 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 .
Shortening product life cycle
– it is one of the major threat that Highbridge Dubin is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Highbridge Dubin demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Stagnating economy with rate increase
– Highbridge Dubin 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.
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 Highbridge Dubin.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Highbridge Dubin with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Highbridge Dubin 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.
Weighted SWOT Analysis of Highbridge Capital Management: Building a Sustainable Organization 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 Highbridge Capital Management: Building a Sustainable Organization 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 Highbridge Capital Management: Building a Sustainable Organization 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 Highbridge Capital Management: Building a Sustainable Organization 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 Highbridge Capital Management: Building a Sustainable Organization 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 Highbridge Dubin needs to make to build a sustainable competitive advantage.
