Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors
In the fall of 2015, Beneficial State Bank was set to mark its third successive year of normalized profitability while continuing to fulfill its mission to promote social justice and environmental sustainability. At the same time, husband and wife creators of the bank, Tom Steyer (MBA '83) and Kat Taylor (JD/MBA '86), found themselves at a crossroads. As the sole providers of capital to the bank during formation and, as a result of the bank's unique organizational structure, the couple remained the only investors in the bank almost a decade since its founding. With assets of $420 million, the team envisioned scaling the business for both economic viability and impact to over ten times the current size in the coming years. In order to achieve this goal, however, the founders would have to consider the introduction of additional investors. This case describes the motivating factors for changing the bank's existing capital structure, and potential investment options to fulfill these goals. It includes a discussion of prospective investors, existing capitalization and growth prospects, and the role of mergers and acquisitions.
Authors :: Charles Ewald, Heidi Krauel Patel, Jaclyn C. Foroughi
Swot Analysis of "Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors" written by Charles Ewald, Heidi Krauel Patel, Jaclyn C. Foroughi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bank Investors facing as an external strategic factors. Some of the topics covered in Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors case study are - Strategic Management Strategies, and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors casestudy better are - – technology disruption, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, geopolitical disruptions, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels,
increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bank Investors, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bank Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors can be done for the following purposes –
1. Strategic planning using facts provided in Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors case study
2. Improving business portfolio management of Bank Investors
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 Bank Investors
Strengths Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bank Investors in Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Bank Investors 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Bank Investors digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bank Investors 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.
Learning organization
- Bank Investors 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 Bank Investors is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Leadership & Managing People industry
– Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors firm has clearly differentiated products in the market place. This has enabled Bank Investors to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Bank Investors to invest into research and development (R&D) and innovation.
Ability to lead change in Leadership & Managing People field
– Bank Investors 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 Bank Investors in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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.
Innovation driven organization
– Bank Investors is one of the most innovative firm in sector. Manager in Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Bank Investors has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bank Investors 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.
High switching costs
– The high switching costs that Bank Investors 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.
Organizational Resilience of Bank Investors
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bank Investors does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Bank Investors is present in almost all the verticals within the industry. This has provided firm in Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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.
Training and development
– Bank Investors has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors are -
Aligning sales with marketing
– It come across in the case study Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors can leverage the sales team experience to cultivate customer relationships as Bank Investors is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Bank Investors 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. Bank Investors 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Charles Ewald, Heidi Krauel Patel, Jaclyn C. Foroughi suggests that, Bank Investors 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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 Bank Investors has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors HBR case study mentions - Bank Investors 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bank Investors is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Bank Investors 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors, it seems that the employees of Bank Investors 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.
Lack of clear differentiation of Bank Investors products
– To increase the profitability and margins on the products, Bank Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors, in the dynamic environment Bank Investors has struggled to respond to the nimble upstart competition. Bank Investors has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though Bank Investors 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 - Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors should strive to include more intangible value offerings along with its core products and services.
Opportunities Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors | 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors are -
Leveraging digital technologies
– Bank Investors 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 Bank Investors has opened avenues for new revenue streams for the organization in the industry. This can help Bank Investors to build a more holistic ecosystem as suggested in the Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors case study. Bank Investors can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Loyalty marketing
– Bank Investors 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bank Investors in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Better consumer reach
– The expansion of the 5G network will help Bank Investors to increase its market reach. Bank Investors 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bank Investors 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bank Investors is facing challenges because of the dominance of functional experts in the organization. Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bank Investors 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 Bank Investors to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Bank Investors 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Bank Investors 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, Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Bank Investors can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Bank Investors 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.
Building a culture of innovation
– managers at Bank Investors 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.
Threats Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors are -
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. Bank Investors 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 Bank Investors 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bank Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors .
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.
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.
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 Bank Investors business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Bank Investors 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 Bank Investors with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Bank Investors in the Leadership & Managing People sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Bank Investors 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. Bank Investors can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors, Bank Investors 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 Bank Investors is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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 Beneficial State Bank (B): Evaluating Financial and Social Returns for Investors 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 Bank Investors needs to make to build a sustainable competitive advantage.
