Case Study Description of Paul Thomson: Walker Insurance
Having just acquired Walker Insurance, Paul Thomson finds himself short of funds to support his original turnaround plan. He can request additional cash from his investor group, hunker down and grow at a slower rate or consider a proposal to buy his business. He has taken steps to re-virtualize the company and is challenged to build a salesforce to grow the business. Having just acquired Walker Insurance, Paul Thomson finds himself short of funds to support his original growth plan. He can request additional funding from his investor group, hunker down and grow at a slower rate or consider a proposal to buy his business. The transition from the old owner is complete and he has taken steps to re-virtualize the company under his leadership.
Authors :: Michael J. Roberts, James M. Sharpe, Sonia Nagala Chang
Swot Analysis of "Paul Thomson: Walker Insurance" written by Michael J. Roberts, James M. Sharpe, Sonia Nagala Chang includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Thomson Walker facing as an external strategic factors. Some of the topics covered in Paul Thomson: Walker Insurance case study are - Strategic Management Strategies, Collaboration, Crisis management, Entrepreneurial management, Internet, Mergers & acquisitions, Operations management, Sales and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Paul Thomson: Walker Insurance casestudy better are - – there is backlash against globalization, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, increasing energy prices, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions,
competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Paul Thomson: Walker Insurance
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Paul Thomson: Walker Insurance case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Thomson Walker, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Thomson Walker 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 Paul Thomson: Walker Insurance can be done for the following purposes –
1. Strategic planning using facts provided in Paul Thomson: Walker Insurance case study
2. Improving business portfolio management of Thomson Walker
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 Thomson Walker
Strengths Paul Thomson: Walker Insurance | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Thomson Walker in Paul Thomson: Walker Insurance Harvard Business Review case study are -
Effective Research and Development (R&D)
– Thomson Walker 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 Paul Thomson: Walker Insurance - 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 Thomson Walker in the sector have low bargaining power. Paul Thomson: Walker Insurance has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Thomson Walker to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Thomson Walker
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Thomson Walker does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Thomson Walker 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 Paul Thomson: Walker Insurance HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Leadership & Managing People field
– Thomson Walker 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 Thomson Walker 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
– Thomson Walker has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Thomson Walker 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.
Strong track record of project management
– Thomson Walker is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Thomson Walker 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.
Analytics focus
– Thomson Walker 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 Michael J. Roberts, James M. Sharpe, Sonia Nagala Chang 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.
High switching costs
– The high switching costs that Thomson Walker 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.
Ability to recruit top talent
– Thomson Walker is one of the leading recruiters in the industry. Managers in the Paul Thomson: Walker Insurance 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
- Thomson Walker 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 Thomson Walker is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Paul Thomson: Walker Insurance Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Paul Thomson: Walker Insurance | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Paul Thomson: Walker Insurance are -
Slow to strategic competitive environment developments
– As Paul Thomson: Walker Insurance HBR case study mentions - Thomson Walker takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Low market penetration in new markets
– Outside its home market of Thomson Walker, firm in the HBR case study Paul Thomson: Walker Insurance needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Paul Thomson: Walker Insurance 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 Thomson Walker 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Paul Thomson: Walker Insurance, 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Paul Thomson: Walker Insurance, in the dynamic environment Thomson Walker has struggled to respond to the nimble upstart competition. Thomson Walker has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Thomson Walker 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.
Increasing silos among functional specialists
– The organizational structure of Thomson Walker is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Thomson Walker needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Thomson Walker to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Thomson Walker products
– To increase the profitability and margins on the products, Thomson Walker needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Thomson Walker is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Paul Thomson: Walker Insurance can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High dependence on 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 Thomson Walker supply chain. Even after few cautionary changes mentioned in the HBR case study - Paul Thomson: Walker Insurance, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Thomson Walker vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael J. Roberts, James M. Sharpe, Sonia Nagala Chang suggests that, Thomson Walker 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.
Opportunities Paul Thomson: Walker Insurance | 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 Paul Thomson: Walker Insurance are -
Using analytics as competitive advantage
– Thomson Walker 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 Paul Thomson: Walker Insurance - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Thomson Walker 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, Thomson Walker is facing challenges because of the dominance of functional experts in the organization. Paul Thomson: Walker Insurance 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.
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. Thomson Walker 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. Thomson Walker 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Thomson Walker can use these opportunities to build new business models that can help the communities that Thomson Walker operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Learning at scale
– Online learning technologies has now opened space for Thomson Walker 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.
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 Thomson Walker 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.
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. Thomson Walker 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 Thomson Walker in the consumer business. Now Thomson Walker can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Thomson Walker 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.
Leveraging digital technologies
– Thomson Walker 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.
Loyalty marketing
– Thomson Walker 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Thomson Walker 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Thomson Walker can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Paul Thomson: Walker Insurance External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Paul Thomson: Walker Insurance are -
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. Thomson Walker 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.
High dependence on third party suppliers
– Thomson Walker 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.
Regulatory challenges
– Thomson Walker 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.
Shortening product life cycle
– it is one of the major threat that Thomson Walker is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Thomson Walker with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Thomson Walker has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Thomson Walker 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.
Consumer confidence and its impact on Thomson Walker 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.
Environmental challenges
– Thomson Walker needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Thomson Walker can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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.
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 Thomson Walker business can come under increasing regulations regarding data privacy, data security, etc.
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 Thomson Walker in the Leadership & Managing People sector and impact the bottomline of the organization.
Increasing wage structure of Thomson Walker
– 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 Thomson Walker.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Thomson Walker 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 Paul Thomson: Walker Insurance .
Weighted SWOT Analysis of Paul Thomson: Walker Insurance 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 Paul Thomson: Walker Insurance 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 Paul Thomson: Walker Insurance 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 Paul Thomson: Walker Insurance 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 Paul Thomson: Walker Insurance 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 Thomson Walker needs to make to build a sustainable competitive advantage.