Abelli and Saviotti at Banca Commerciale Italiana (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Abelli and Saviotti at Banca Commerciale Italiana (A)
In 1999, a powerful struggle amidst complex corporate and interpersonal networks led to the failed merger between Banca Commerciale Italiana and Unicredito Italiano--two of Italy's largest banking groups. This case analyzes the actions of Abelli and Saviotti, co-CEOs of Banca Commerciale Italiana at that time, as well as those of central players in Banca d'Italia, Mediobanca, and several prominent national and international banking and industrial groups. The events shed light on the management of multilayered resource dependencies and tactics of political influence as a critical precondition for implementing sound business strategy.
Authors :: Tiziana Casciaro, Kathleen L. McGinn, Massimiliano Belingheri
Swot Analysis of "Abelli and Saviotti at Banca Commerciale Italiana (A)" written by Tiziana Casciaro, Kathleen L. McGinn, Massimiliano Belingheri includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Banca Commerciale facing as an external strategic factors. Some of the topics covered in Abelli and Saviotti at Banca Commerciale Italiana (A) case study are - Strategic Management Strategies, Influence, Mergers & acquisitions, Networking and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Abelli and Saviotti at Banca Commerciale Italiana (A) casestudy better are - – increasing household debt because of falling income levels, geopolitical disruptions, wage bills are increasing, there is backlash against globalization, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies,
cloud computing is disrupting traditional business models, technology disruption, etc
Introduction to SWOT Analysis of Abelli and Saviotti at Banca Commerciale Italiana (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Abelli and Saviotti at Banca Commerciale Italiana (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Banca Commerciale, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Banca Commerciale 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 Abelli and Saviotti at Banca Commerciale Italiana (A) can be done for the following purposes –
1. Strategic planning using facts provided in Abelli and Saviotti at Banca Commerciale Italiana (A) case study
2. Improving business portfolio management of Banca Commerciale
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 Banca Commerciale
Strengths Abelli and Saviotti at Banca Commerciale Italiana (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Banca Commerciale in Abelli and Saviotti at Banca Commerciale Italiana (A) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Banca Commerciale in the sector have low bargaining power. Abelli and Saviotti at Banca Commerciale Italiana (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Banca Commerciale to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Banca Commerciale
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Banca Commerciale does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Leadership & Managing People field
– Banca Commerciale 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 Banca Commerciale in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Banca Commerciale 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 Abelli and Saviotti at Banca Commerciale Italiana (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.
Analytics focus
– Banca Commerciale 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 Tiziana Casciaro, Kathleen L. McGinn, Massimiliano Belingheri 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.
Ability to recruit top talent
– Banca Commerciale is one of the leading recruiters in the industry. Managers in the Abelli and Saviotti at Banca Commerciale Italiana (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.
Learning organization
- Banca Commerciale 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 Banca Commerciale is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Abelli and Saviotti at Banca Commerciale Italiana (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Banca Commerciale 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.
Successful track record of launching new products
– Banca Commerciale has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Banca Commerciale 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.
Innovation driven organization
– Banca Commerciale is one of the most innovative firm in sector. Manager in Abelli and Saviotti at Banca Commerciale Italiana (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Banca Commerciale in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Banca Commerciale 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.
Weaknesses Abelli and Saviotti at Banca Commerciale Italiana (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Abelli and Saviotti at Banca Commerciale Italiana (A) are -
Products dominated business model
– Even though Banca Commerciale 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 - Abelli and Saviotti at Banca Commerciale Italiana (A) should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Banca Commerciale 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.
Lack of clear differentiation of Banca Commerciale products
– To increase the profitability and margins on the products, Banca Commerciale needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study Abelli and Saviotti at Banca Commerciale Italiana (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 Abelli and Saviotti at Banca Commerciale Italiana (A) can leverage the sales team experience to cultivate customer relationships as Banca Commerciale is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Banca Commerciale 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. Banca Commerciale 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.
Increasing silos among functional specialists
– The organizational structure of Banca Commerciale is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Banca Commerciale needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Banca Commerciale to focus more on services rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Banca Commerciale is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Abelli and Saviotti at Banca Commerciale Italiana (A) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Banca Commerciale 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.
Low market penetration in new markets
– Outside its home market of Banca Commerciale, firm in the HBR case study Abelli and Saviotti at Banca Commerciale Italiana (A) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Abelli and Saviotti at Banca Commerciale Italiana (A), it seems that the employees of Banca Commerciale 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.
No frontier risks strategy
– After analyzing the HBR case study Abelli and Saviotti at Banca Commerciale Italiana (A), 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.
Opportunities Abelli and Saviotti at Banca Commerciale Italiana (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 Abelli and Saviotti at Banca Commerciale Italiana (A) are -
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. Banca Commerciale can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Banca Commerciale in the consumer business. Now Banca Commerciale can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Banca Commerciale is facing challenges because of the dominance of functional experts in the organization. Abelli and Saviotti at Banca Commerciale Italiana (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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Banca Commerciale 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.
Developing new processes and practices
– Banca Commerciale 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.
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 Banca Commerciale 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.
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. Banca Commerciale can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Banca Commerciale can use these opportunities to build new business models that can help the communities that Banca Commerciale operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Manufacturing automation
– Banca Commerciale 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.
Better consumer reach
– The expansion of the 5G network will help Banca Commerciale to increase its market reach. Banca Commerciale 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Banca Commerciale 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, Abelli and Saviotti at Banca Commerciale Italiana (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.
Learning at scale
– Online learning technologies has now opened space for Banca Commerciale 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Banca Commerciale 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 Banca Commerciale to hire the very best people irrespective of their geographical location.
Threats Abelli and Saviotti at Banca Commerciale Italiana (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Abelli and Saviotti at Banca Commerciale Italiana (A) are -
Stagnating economy with rate increase
– Banca Commerciale 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.
Shortening product life cycle
– it is one of the major threat that Banca Commerciale is facing in Leadership & Managing People 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, Banca Commerciale 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 Abelli and Saviotti at Banca Commerciale Italiana (A) .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Banca Commerciale with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Banca Commerciale business can come under increasing regulations regarding data privacy, data security, etc.
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. Banca Commerciale 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 Abelli and Saviotti at Banca Commerciale Italiana (A), Banca Commerciale 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 .
Regulatory challenges
– Banca Commerciale 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.
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 Banca Commerciale in the Leadership & Managing People sector and impact the bottomline of the organization.
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. Banca Commerciale needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Increasing wage structure of Banca Commerciale
– 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 Banca Commerciale.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Banca Commerciale 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.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Banca Commerciale will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Weighted SWOT Analysis of Abelli and Saviotti at Banca Commerciale Italiana (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 Abelli and Saviotti at Banca Commerciale Italiana (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 Abelli and Saviotti at Banca Commerciale Italiana (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 Abelli and Saviotti at Banca Commerciale Italiana (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 Abelli and Saviotti at Banca Commerciale Italiana (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 Banca Commerciale needs to make to build a sustainable competitive advantage.
