Note on Tax and Accounting Issues in Mergers and Acquisitions SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Note on Tax and Accounting Issues in Mergers and Acquisitions
Presents a simplified introduction to tax and accounting issues relevant to mergers and acquisitions. Mergers, asset purchase, and stock acquisition are dealt with in the context of taxable vs. non-taxable transactions. Accounting treatment of the transactions is discussed as well.
Swot Analysis of "Note on Tax and Accounting Issues in Mergers and Acquisitions" written by David M. Meerschwam includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Taxable Mergers facing as an external strategic factors. Some of the topics covered in Note on Tax and Accounting Issues in Mergers and Acquisitions case study are - Strategic Management Strategies, Financial markets, Mergers & acquisitions, Policy, Reorganization and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Note on Tax and Accounting Issues in Mergers and Acquisitions casestudy better are - – talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices,
challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Note on Tax and Accounting Issues in Mergers and Acquisitions
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Note on Tax and Accounting Issues in Mergers and Acquisitions case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Taxable Mergers, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Taxable Mergers 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 Note on Tax and Accounting Issues in Mergers and Acquisitions can be done for the following purposes –
1. Strategic planning using facts provided in Note on Tax and Accounting Issues in Mergers and Acquisitions case study
2. Improving business portfolio management of Taxable Mergers
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 Taxable Mergers
Strengths Note on Tax and Accounting Issues in Mergers and Acquisitions | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Taxable Mergers in Note on Tax and Accounting Issues in Mergers and Acquisitions Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Taxable Mergers in the sector have low bargaining power. Note on Tax and Accounting Issues in Mergers and Acquisitions has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Taxable Mergers to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Taxable Mergers 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Note on Tax and Accounting Issues in Mergers and Acquisitions firm has clearly differentiated products in the market place. This has enabled Taxable Mergers to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Taxable Mergers to invest into research and development (R&D) and innovation.
Strong track record of project management
– Taxable Mergers is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Taxable Mergers is present in almost all the verticals within the industry. This has provided firm in Note on Tax and Accounting Issues in Mergers and Acquisitions 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.
Operational resilience
– The operational resilience strategy in the Note on Tax and Accounting Issues in Mergers and Acquisitions 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.
Analytics focus
– Taxable Mergers 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 David M. Meerschwam 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.
Organizational Resilience of Taxable Mergers
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Taxable Mergers does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Taxable Mergers in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Taxable Mergers 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 Note on Tax and Accounting Issues in Mergers and Acquisitions HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Taxable Mergers is one of the leading recruiters in the industry. Managers in the Note on Tax and Accounting Issues in Mergers and Acquisitions 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 brand equity
– Taxable Mergers has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Taxable Mergers to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Note on Tax and Accounting Issues in Mergers and Acquisitions | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Note on Tax and Accounting Issues in Mergers and Acquisitions are -
High bargaining power of channel partners
– Because of the regulatory requirements, David M. Meerschwam suggests that, Taxable Mergers 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 cash cycle compare to competitors
Taxable Mergers 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Note on Tax and Accounting Issues in Mergers and Acquisitions, in the dynamic environment Taxable Mergers has struggled to respond to the nimble upstart competition. Taxable Mergers has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Taxable Mergers is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Note on Tax and Accounting Issues in Mergers and Acquisitions can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Note on Tax and Accounting Issues in Mergers and Acquisitions 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 Taxable Mergers has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Taxable Mergers 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Note on Tax and Accounting Issues in Mergers and Acquisitions, is just above the industry average. Taxable Mergers 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 to strategic competitive environment developments
– As Note on Tax and Accounting Issues in Mergers and Acquisitions HBR case study mentions - Taxable Mergers 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 decision making process
– As mentioned earlier in the report, Taxable Mergers 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. Taxable Mergers 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.
Lack of clear differentiation of Taxable Mergers products
– To increase the profitability and margins on the products, Taxable Mergers needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Taxable Mergers 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.
Opportunities Note on Tax and Accounting Issues in Mergers and Acquisitions | 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 Note on Tax and Accounting Issues in Mergers and Acquisitions are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Taxable Mergers 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, Note on Tax and Accounting Issues in Mergers and Acquisitions, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Low interest rates
– Even though inflation is raising its head in most developed economies, Taxable Mergers 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.
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 Taxable Mergers 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.
Buying journey improvements
– Taxable Mergers can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Note on Tax and Accounting Issues in Mergers and Acquisitions 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Taxable Mergers can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Taxable Mergers 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.
Developing new processes and practices
– Taxable Mergers 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Taxable Mergers can use these opportunities to build new business models that can help the communities that Taxable Mergers operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
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. Taxable Mergers can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Taxable Mergers 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.
Building a culture of innovation
– managers at Taxable Mergers 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.
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 Taxable Mergers in the consumer business. Now Taxable Mergers can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Taxable Mergers 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.
Threats Note on Tax and Accounting Issues in Mergers and Acquisitions External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Note on Tax and Accounting Issues in Mergers and Acquisitions are -
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.
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 Taxable Mergers in the Finance & Accounting sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Taxable Mergers 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.
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 Taxable Mergers business can come under increasing regulations regarding data privacy, data security, etc.
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. Taxable Mergers needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Taxable Mergers 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 Note on Tax and Accounting Issues in Mergers and Acquisitions .
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Taxable Mergers 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 Note on Tax and Accounting Issues in Mergers and Acquisitions, Taxable Mergers may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Environmental challenges
– Taxable Mergers 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. Taxable Mergers can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
Stagnating economy with rate increase
– Taxable Mergers 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.
Increasing wage structure of Taxable Mergers
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Taxable Mergers.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Taxable Mergers 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.
Technology acceleration in Forth Industrial Revolution
– Taxable Mergers has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Taxable Mergers 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.
Weighted SWOT Analysis of Note on Tax and Accounting Issues in Mergers and Acquisitions 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 Note on Tax and Accounting Issues in Mergers and Acquisitions 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 Note on Tax and Accounting Issues in Mergers and Acquisitions 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 Note on Tax and Accounting Issues in Mergers and Acquisitions 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 Note on Tax and Accounting Issues in Mergers and Acquisitions 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 Taxable Mergers needs to make to build a sustainable competitive advantage.