Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies
Most evidence regarding the determinants and effects of corporate governance practices is based on large firms. Herein, we explore these issues in the context of small publicly traded Canadian companies. We exploit the fact that such firms were not subject to corporate governance guidelines prior to 2005 and thus analyze the determinants of voluntary governance practice choices, as well as the effects of those practices on firm performance. Using a unique data set, we construct a corporate governance index for each firm. We measure performance by two variables: quality of accounting earnings and financial performance. The results indicate that corporate governance does matter for smaller traded Canadian firms. We find that both accounting and financial performance are positively related to corporate governance; however, their underlying mechanisms may differ somewhat. Given this result, it would be natural to expect all firms to choose higher levels of governance. However, our results also suggest small firms face resource constraints that limit their choices. We conclude that good governance is an important driver of small firm performance that cannot be neglected by the owners and managers of these firms.
Authors :: Irene Gordon, Karel Hrazdil, Daniel Shapiro
Swot Analysis of "Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies" written by Irene Gordon, Karel Hrazdil, Daniel Shapiro includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Governance Firms facing as an external strategic factors. Some of the topics covered in Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies case study are - Strategic Management Strategies, International business and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies casestudy better are - – increasing energy prices, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, increasing transportation and logistics costs, technology disruption, increasing government debt because of Covid-19 spendings, wage bills are increasing,
central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Governance Firms, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Governance Firms 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies can be done for the following purposes –
1. Strategic planning using facts provided in Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies case study
2. Improving business portfolio management of Governance Firms
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 Governance Firms
Strengths Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Governance Firms in Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies Harvard Business Review case study are -
Learning organization
- Governance Firms 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 Governance Firms is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Governance Firms in the sector have low bargaining power. Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Governance Firms to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Governance Firms is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to recruit top talent
– Governance Firms is one of the leading recruiters in the industry. Managers in the Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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.
Superior customer experience
– The customer experience strategy of Governance Firms in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Governance Firms has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Organizational Resilience of Governance Firms
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Governance Firms does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Leadership & Managing People industry
– Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies firm has clearly differentiated products in the market place. This has enabled Governance Firms to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Governance Firms to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Governance Firms 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.
Diverse revenue streams
– Governance Firms is present in almost all the verticals within the industry. This has provided firm in Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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.
Analytics focus
– Governance Firms 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 Irene Gordon, Karel Hrazdil, Daniel Shapiro 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies, is just above the industry average. Governance Firms 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.
No frontier risks strategy
– After analyzing the HBR case study Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies, 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.
High cash cycle compare to competitors
Governance Firms 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.
Products dominated business model
– Even though Governance Firms 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 - Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Governance Firms 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. Governance Firms even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High bargaining power of channel partners
– Because of the regulatory requirements, Irene Gordon, Karel Hrazdil, Daniel Shapiro suggests that, Governance Firms 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.
Low market penetration in new markets
– Outside its home market of Governance Firms, firm in the HBR case study Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies can leverage the sales team experience to cultivate customer relationships as Governance Firms is planning to shift buying processes online.
Interest costs
– Compare to the competition, Governance Firms 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies, it seems that the employees of Governance Firms 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies, in the dynamic environment Governance Firms has struggled to respond to the nimble upstart competition. Governance Firms has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies | 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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. Governance Firms 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. Governance Firms 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.
Learning at scale
– Online learning technologies has now opened space for Governance Firms 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.
Using analytics as competitive advantage
– Governance Firms 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Governance Firms to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Governance Firms is facing challenges because of the dominance of functional experts in the organization. Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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.
Developing new processes and practices
– Governance Firms 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.
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. Governance Firms can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Governance Firms 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.
Leveraging digital technologies
– Governance Firms 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Governance Firms in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Governance Firms can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Governance Firms can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.
Manufacturing automation
– Governance Firms 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Governance Firms 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 Governance Firms to hire the very best people irrespective of their geographical location.
Threats Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies, Governance Firms 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 .
Technology acceleration in Forth Industrial Revolution
– Governance Firms has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Governance Firms 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.
High dependence on third party suppliers
– Governance Firms 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.
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.
Regulatory challenges
– Governance Firms 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.
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. Governance Firms 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Governance Firms 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Governance Firms with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Governance Firms in the Leadership & Managing People sector and impact the bottomline of the organization.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Governance Firms 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies .
Consumer confidence and its impact on Governance Firms demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Increasing wage structure of Governance Firms
– 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 Governance Firms.
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.
Weighted SWOT Analysis of Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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 Corporate Governance in Publicly Traded Small Firms: A Study of Canadian Venture Exchange Companies 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 Governance Firms needs to make to build a sustainable competitive advantage.
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