Liquidity, Mutual Fund Flows, and ReFlow Management, LLC SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Liquidity, Mutual Fund Flows, and ReFlow Management, LLC
This case examines the importance of liquidity to financial markets, using the dramatic volatility of mutual fund flows in 2008 as an example. While the case is targeted to MBA students in an investments or portfolio management course, it is also appropriate for an advanced undergraduate course. It is written from the perspective of a fund manager who has experienced significant redemptions in 2008 and is considering whether or not to use ReFlow Management LLC's "liquidity provision" service. The case requires students to examine the nature and magnitude of mutual fund trading costs, how fund flows may induce additional trading and how ReFlow's innovative service attempts to resolve these issues. Through this analysis, students will better understand what is meant by the term "liquidity" and how liquidity, or a lack thereof, can negatively impact portfolio performance.
Swot Analysis of "Liquidity, Mutual Fund Flows, and ReFlow Management, LLC" written by Richard B. Evans, Michael Mills includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Liquidity Reflow facing as an external strategic factors. Some of the topics covered in Liquidity, Mutual Fund Flows, and ReFlow Management, LLC case study are - Strategic Management Strategies, and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Liquidity, Mutual Fund Flows, and ReFlow Management, LLC casestudy better are - – increasing government debt because of Covid-19 spendings, technology disruption, cloud computing is disrupting traditional business models, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, there is increasing trade war between United States & China,
challanges to central banks by blockchain based private currencies, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Liquidity, Mutual Fund Flows, and ReFlow Management, LLC
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Liquidity, Mutual Fund Flows, and ReFlow Management, LLC case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Liquidity Reflow, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Liquidity Reflow 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC can be done for the following purposes –
1. Strategic planning using facts provided in Liquidity, Mutual Fund Flows, and ReFlow Management, LLC case study
2. Improving business portfolio management of Liquidity Reflow
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Liquidity Reflow
Strengths Liquidity, Mutual Fund Flows, and ReFlow Management, LLC | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Liquidity Reflow in Liquidity, Mutual Fund Flows, and ReFlow Management, LLC Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Liquidity Reflow in the sector have low bargaining power. Liquidity, Mutual Fund Flows, and ReFlow Management, LLC has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Liquidity Reflow to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Liquidity Reflow is present in almost all the verticals within the industry. This has provided firm in Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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.
Strong track record of project management
– Liquidity Reflow 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
– Liquidity Reflow has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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.
High brand equity
– Liquidity Reflow has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Liquidity Reflow to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Liquidity Reflow 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 Liquidity Reflow is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Liquidity, Mutual Fund Flows, and ReFlow Management, LLC Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Finance & Accounting industry
– Liquidity, Mutual Fund Flows, and ReFlow Management, LLC firm has clearly differentiated products in the market place. This has enabled Liquidity Reflow to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Liquidity Reflow to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Liquidity Reflow 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Liquidity Reflow 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 Richard B. Evans, Michael Mills 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.
Cross disciplinary teams
– Horizontal connected teams at the Liquidity Reflow are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Successful track record of launching new products
– Liquidity Reflow has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Liquidity Reflow 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.
Organizational Resilience of Liquidity Reflow
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Liquidity Reflow does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Liquidity, Mutual Fund Flows, and ReFlow Management, LLC | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Liquidity, Mutual Fund Flows, and ReFlow Management, LLC are -
Slow decision making process
– As mentioned earlier in the report, Liquidity Reflow 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. Liquidity Reflow 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.
Aligning sales with marketing
– It come across in the case study Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC can leverage the sales team experience to cultivate customer relationships as Liquidity Reflow is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Liquidity Reflow is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Liquidity Reflow needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Liquidity Reflow to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Liquidity, Mutual Fund Flows, and ReFlow Management, LLC, it seems that the employees of Liquidity Reflow 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 cash cycle compare to competitors
Liquidity Reflow 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.
Slow to strategic competitive environment developments
– As Liquidity, Mutual Fund Flows, and ReFlow Management, LLC HBR case study mentions - Liquidity Reflow 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.
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 Liquidity Reflow supply chain. Even after few cautionary changes mentioned in the HBR case study - Liquidity, Mutual Fund Flows, and ReFlow Management, LLC, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Liquidity Reflow vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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 Liquidity Reflow has relatively successful track record of launching new products.
Lack of clear differentiation of Liquidity Reflow products
– To increase the profitability and margins on the products, Liquidity Reflow needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Liquidity, Mutual Fund Flows, and ReFlow Management, LLC, in the dynamic environment Liquidity Reflow has struggled to respond to the nimble upstart competition. Liquidity Reflow has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Liquidity Reflow 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.
Opportunities Liquidity, Mutual Fund Flows, and ReFlow Management, LLC | 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC are -
Using analytics as competitive advantage
– Liquidity Reflow 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Liquidity Reflow to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Liquidity Reflow 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, Liquidity, Mutual Fund Flows, and ReFlow Management, LLC, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Liquidity Reflow in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Liquidity Reflow can use these opportunities to build new business models that can help the communities that Liquidity Reflow operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Buying journey improvements
– Liquidity Reflow can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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.
Creating value in data economy
– The success of analytics program of Liquidity Reflow has opened avenues for new revenue streams for the organization in the industry. This can help Liquidity Reflow to build a more holistic ecosystem as suggested in the Liquidity, Mutual Fund Flows, and ReFlow Management, LLC case study. Liquidity Reflow can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Liquidity Reflow can develop new processes and procedures in Finance & Accounting industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Building a culture of innovation
– managers at Liquidity Reflow 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 Finance & Accounting segment.
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 Liquidity Reflow 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.
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 Liquidity Reflow in the consumer business. Now Liquidity Reflow can target international markets with far fewer capital restrictions requirements than the existing system.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Liquidity Reflow can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Liquidity Reflow can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Liquidity Reflow 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. Liquidity Reflow 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.
Threats Liquidity, Mutual Fund Flows, and ReFlow Management, LLC External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Liquidity, Mutual Fund Flows, and ReFlow Management, LLC are -
Shortening product life cycle
– it is one of the major threat that Liquidity Reflow is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Liquidity Reflow needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Finance & Accounting industry regulations.
Technology acceleration in Forth Industrial Revolution
– Liquidity Reflow has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Liquidity Reflow needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
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 Liquidity Reflow business can come under increasing regulations regarding data privacy, data security, etc.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Liquidity Reflow in the Finance & Accounting industry. The Finance & Accounting 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Liquidity Reflow with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Liquidity Reflow 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC .
Stagnating economy with rate increase
– Liquidity Reflow 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.
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 Liquidity Reflow in the Finance & Accounting sector and impact the bottomline of the organization.
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 Liquidity Reflow.
High dependence on third party suppliers
– Liquidity Reflow 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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 Liquidity, Mutual Fund Flows, and ReFlow Management, LLC 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 Liquidity Reflow needs to make to build a sustainable competitive advantage.
