The Congressional Oversight Panel's Valuation of the TARP Warrants (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Congressional Oversight Panel's Valuation of the TARP Warrants (A)
The Congressional Oversight Panel wants to value the warrants issued to the government in connection with the TARP investments of 2008, in order to increase the transparency of options repurchases. The case describes the methodology used to value the warrants. Students have the opportunity to value warrants issued by 10 of the largest banks and to evaluate whether the Black-Scholes model can be used to value these very long-lived 10 options. Can be used to teach basic option valuation using Black-Scholes, but also raise dynamic hedging issues of interest to advanced students.
Swot Analysis of "The Congressional Oversight Panel's Valuation of the TARP Warrants (A)" written by Carliss Y. Baldwin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Warrants Tarp facing as an external strategic factors. Some of the topics covered in The Congressional Oversight Panel's Valuation of the TARP Warrants (A) case study are - Strategic Management Strategies, Financial analysis, Financial management, Financial markets, Government, Recession and Finance & Accounting.
Some of the macro environment factors that can be used to understand the The Congressional Oversight Panel's Valuation of the TARP Warrants (A) casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs,
increasing household debt because of falling income levels, wage bills are increasing, etc
Introduction to SWOT Analysis of The Congressional Oversight Panel's Valuation of the TARP Warrants (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Congressional Oversight Panel's Valuation of the TARP Warrants (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Warrants Tarp, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Warrants Tarp 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) can be done for the following purposes –
1. Strategic planning using facts provided in The Congressional Oversight Panel's Valuation of the TARP Warrants (A) case study
2. Improving business portfolio management of Warrants Tarp
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 Warrants Tarp
Strengths The Congressional Oversight Panel's Valuation of the TARP Warrants (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Warrants Tarp in The Congressional Oversight Panel's Valuation of the TARP Warrants (A) Harvard Business Review case study are -
Highly skilled collaborators
– Warrants Tarp 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Warrants Tarp 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Low bargaining power of suppliers
– Suppliers of Warrants Tarp in the sector have low bargaining power. The Congressional Oversight Panel's Valuation of the TARP Warrants (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Warrants Tarp to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Warrants Tarp 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.
High brand equity
– Warrants Tarp has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Warrants Tarp to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Warrants Tarp has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Warrants Tarp 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.
Ability to recruit top talent
– Warrants Tarp is one of the leading recruiters in the industry. Managers in the The Congressional Oversight Panel's Valuation of the TARP Warrants (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Warrants Tarp is present in almost all the verticals within the industry. This has provided firm in The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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.
Learning organization
- Warrants Tarp 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 Warrants Tarp is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Congressional Oversight Panel's Valuation of the TARP Warrants (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Warrants Tarp in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Warrants Tarp has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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.
Analytics focus
– Warrants Tarp 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 Carliss Y. Baldwin 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.
Weaknesses The Congressional Oversight Panel's Valuation of the TARP Warrants (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Congressional Oversight Panel's Valuation of the TARP Warrants (A) are -
Workers concerns about automation
– As automation is fast increasing in the segment, Warrants Tarp 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 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 Warrants Tarp supply chain. Even after few cautionary changes mentioned in the HBR case study - The Congressional Oversight Panel's Valuation of the TARP Warrants (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Warrants Tarp vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Warrants Tarp 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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 Warrants Tarp has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) can leverage the sales team experience to cultivate customer relationships as Warrants Tarp is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Carliss Y. Baldwin suggests that, Warrants Tarp 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.
Capital Spending Reduction
– Even during the low interest decade, Warrants Tarp 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Congressional Oversight Panel's Valuation of the TARP Warrants (A), is just above the industry average. Warrants Tarp 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.
Products dominated business model
– Even though Warrants Tarp 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 - The Congressional Oversight Panel's Valuation of the TARP Warrants (A) should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Warrants Tarp is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Warrants Tarp needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Warrants Tarp to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Warrants Tarp, firm in the HBR case study The Congressional Oversight Panel's Valuation of the TARP Warrants (A) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities The Congressional Oversight Panel's Valuation of the TARP Warrants (A) | 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) are -
Building a culture of innovation
– managers at Warrants Tarp 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Warrants Tarp 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, The Congressional Oversight Panel's Valuation of the TARP Warrants (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Warrants Tarp 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. Warrants Tarp 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.
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 Warrants Tarp in the consumer business. Now Warrants Tarp can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Warrants Tarp 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.
Creating value in data economy
– The success of analytics program of Warrants Tarp has opened avenues for new revenue streams for the organization in the industry. This can help Warrants Tarp to build a more holistic ecosystem as suggested in the The Congressional Oversight Panel's Valuation of the TARP Warrants (A) case study. Warrants Tarp can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Warrants Tarp 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Warrants Tarp 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.
Buying journey improvements
– Warrants Tarp can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Warrants Tarp is facing challenges because of the dominance of functional experts in the organization. The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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.
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. Warrants Tarp can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Warrants Tarp can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Warrants Tarp 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.
Threats The Congressional Oversight Panel's Valuation of the TARP Warrants (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Congressional Oversight Panel's Valuation of the TARP Warrants (A) are -
Increasing wage structure of Warrants Tarp
– 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 Warrants Tarp.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Warrants Tarp with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Warrants Tarp needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Warrants Tarp 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.
Stagnating economy with rate increase
– Warrants Tarp 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.
Technology acceleration in Forth Industrial Revolution
– Warrants Tarp has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Warrants Tarp 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.
Regulatory challenges
– Warrants Tarp 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 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.
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.
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 Warrants Tarp in the Finance & Accounting sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Warrants Tarp is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Warrants Tarp 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) .
High dependence on third party suppliers
– Warrants Tarp 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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 The Congressional Oversight Panel's Valuation of the TARP Warrants (A) 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 Warrants Tarp needs to make to build a sustainable competitive advantage.
