Liberty Medical Group (Condensed) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Liberty Medical Group (Condensed)
Richard Townsend has recently been elected CEO of Liberty Medical Foundation (LMF), a nonprofit HMO. Due in part to a rapidly changing competitive environment, LMF has faced serious financial problems over the past two years. Confounding the problem are low morale among physicians and staff and declining patient satisfaction. Townsend will present to the board of directors the two strategic choices that he sees for keeping LMF alive. One choice involves LMF regaining its low-cost position that originally attracted so many of its members. LMF's low-cost, high-efficiency positioning has historically been its competitive advantage. Regaining the low-cost position would mean implementing prior authorization requirements, drastically cutting the number of physicians and staff, and copying other cost savings measures that for-profit HMOs use. The other option is to change radically LMF's positioning so that it is the quality and service leader. This option assumes that customers will be willing to pay a premium for excellent service. Either option will require drastic changes to LMF's culture.
Authors :: David Caldwell, Robert Pearl, Davina Drabkin, Charles A. O'Reilly
Swot Analysis of "Liberty Medical Group (Condensed)" written by David Caldwell, Robert Pearl, Davina Drabkin, Charles A. O'Reilly includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Lmf Lmf's facing as an external strategic factors. Some of the topics covered in Liberty Medical Group (Condensed) case study are - Strategic Management Strategies, Leadership, Organizational culture, Strategic planning and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Liberty Medical Group (Condensed) casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, digital marketing is dominated by two big players Facebook and Google,
increasing transportation and logistics costs, geopolitical disruptions, etc
Introduction to SWOT Analysis of Liberty Medical Group (Condensed)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Liberty Medical Group (Condensed) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Lmf Lmf's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Lmf Lmf's 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 Liberty Medical Group (Condensed) can be done for the following purposes –
1. Strategic planning using facts provided in Liberty Medical Group (Condensed) case study
2. Improving business portfolio management of Lmf Lmf's
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 Lmf Lmf's
Strengths Liberty Medical Group (Condensed) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Lmf Lmf's in Liberty Medical Group (Condensed) Harvard Business Review case study are -
High brand equity
– Lmf Lmf's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Lmf Lmf's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Lmf Lmf's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Lmf Lmf's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Lmf Lmf's 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 Liberty Medical Group (Condensed) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Cross disciplinary teams
– Horizontal connected teams at the Lmf Lmf's 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 Lmf Lmf's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Lmf Lmf's 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.
Diverse revenue streams
– Lmf Lmf's is present in almost all the verticals within the industry. This has provided firm in Liberty Medical Group (Condensed) 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
- Lmf Lmf's 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 Lmf Lmf's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Liberty Medical Group (Condensed) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Lmf Lmf's is one of the most innovative firm in sector. Manager in Liberty Medical Group (Condensed) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Leadership & Managing People field
– Lmf Lmf's 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 Lmf Lmf's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Lmf Lmf's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Lmf Lmf's 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.
Training and development
– Lmf Lmf's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Liberty Medical Group (Condensed) 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.
Low bargaining power of suppliers
– Suppliers of Lmf Lmf's in the sector have low bargaining power. Liberty Medical Group (Condensed) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Lmf Lmf's to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Liberty Medical Group (Condensed) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Liberty Medical Group (Condensed) are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Liberty Medical Group (Condensed) 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 Lmf Lmf's has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study Liberty Medical Group (Condensed), it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Interest costs
– Compare to the competition, Lmf Lmf's has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Need for greater diversity
– Lmf Lmf's has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Capital Spending Reduction
– Even during the low interest decade, Lmf Lmf's 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 Liberty Medical Group (Condensed), it seems that the employees of Lmf Lmf's 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.
Products dominated business model
– Even though Lmf Lmf's 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 - Liberty Medical Group (Condensed) should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– It come across in the case study Liberty Medical Group (Condensed) 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 Liberty Medical Group (Condensed) can leverage the sales team experience to cultivate customer relationships as Lmf Lmf's is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Lmf Lmf's has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Liberty Medical Group (Condensed), in the dynamic environment Lmf Lmf's has struggled to respond to the nimble upstart competition. Lmf Lmf's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study Liberty Medical Group (Condensed) has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Lmf Lmf's 's lucrative customers.
Opportunities Liberty Medical Group (Condensed) | 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 Liberty Medical Group (Condensed) are -
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Lmf Lmf's 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. Lmf Lmf's 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.
Loyalty marketing
– Lmf Lmf's 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.
Learning at scale
– Online learning technologies has now opened space for Lmf Lmf's 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.
Developing new processes and practices
– Lmf Lmf's can develop new processes and procedures in Leadership & Managing People industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Lmf Lmf's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Lmf Lmf's 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 Lmf Lmf's to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Lmf Lmf's has opened avenues for new revenue streams for the organization in the industry. This can help Lmf Lmf's to build a more holistic ecosystem as suggested in the Liberty Medical Group (Condensed) case study. Lmf Lmf's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Lmf Lmf's to increase its market reach. Lmf Lmf's 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.
Leveraging digital technologies
– Lmf Lmf's 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.
Using analytics as competitive advantage
– Lmf Lmf's 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 Liberty Medical Group (Condensed) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Lmf Lmf's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Lmf Lmf's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Lmf Lmf's 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Lmf Lmf's can use these opportunities to build new business models that can help the communities that Lmf Lmf's operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Threats Liberty Medical Group (Condensed) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Liberty Medical Group (Condensed) are -
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 Lmf Lmf's in the Leadership & Managing People 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 Lmf Lmf's.
Shortening product life cycle
– it is one of the major threat that Lmf Lmf's is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Lmf Lmf's 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Liberty Medical Group (Condensed), Lmf Lmf's 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 .
Increasing wage structure of Lmf Lmf's
– 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 Lmf Lmf's.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Lmf Lmf's in the Leadership & Managing People industry. The Leadership & Managing People industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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. Lmf Lmf's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Lmf Lmf's has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Lmf Lmf's needs to keep up with the evolution of technology in the Leadership & Managing People 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.
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.
High dependence on third party suppliers
– Lmf Lmf's 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Lmf Lmf's 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 Liberty Medical Group (Condensed) .
Regulatory challenges
– Lmf Lmf's 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.
Weighted SWOT Analysis of Liberty Medical Group (Condensed) 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 Liberty Medical Group (Condensed) 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 Liberty Medical Group (Condensed) 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 Liberty Medical Group (Condensed) 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 Liberty Medical Group (Condensed) 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 Lmf Lmf's needs to make to build a sustainable competitive advantage.
