First Republic Bank ADR H (FRC_ph) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for First Republic Bank ADR H (United States)
Based on various researches at Oak Spring University , First Republic Bank ADR H is operating in a macro-environment that has been destablized by – cloud computing is disrupting traditional business models, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, central banks are concerned over increasing inflation,
increasing government debt because of Covid-19 spendings, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of First Republic Bank ADR H
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that First Republic Bank ADR H can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the First Republic Bank ADR H, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which First Republic Bank ADR H 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 First Republic Bank ADR H can be done for the following purposes –
1. Strategic planning of First Republic Bank ADR H
2. Improving business portfolio management of First Republic Bank ADR H
3. Assessing feasibility of the new initiative in United States
4. Making a sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of First Republic Bank ADR H
Strengths of First Republic Bank ADR H | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of First Republic Bank ADR H are -
Highly skilled collaborators
– First Republic Bank ADR H has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive industry. Secondly the value chain collaborators of First Republic Bank ADR H have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– First Republic Bank ADR H has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. First Republic Bank ADR H 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.
Diverse revenue streams
– First Republic Bank ADR H is present in almost all the verticals within the industry. This has provided First Republic Bank ADR H 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.
Training and development
– First Republic Bank ADR H has one of the best training and development program in industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Effective Research and Development (R&D)
– First Republic Bank ADR H has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – First Republic Bank ADR H staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management in the industry
– First Republic Bank ADR H 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
– First Republic Bank ADR H is one of the leading players in the industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.
High switching costs
– The high switching costs that First Republic Bank ADR H has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
High brand equity
– First Republic Bank ADR H has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled First Republic Bank ADR H to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– First Republic Bank ADR H is one of the most innovative firm in sector.
Superior customer experience
– The customer experience strategy of First Republic Bank ADR H in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Analytics focus
– First Republic Bank ADR H 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 of United States is also helping 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 of First Republic Bank ADR H | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of First Republic Bank ADR H are -
High cash cycle compare to competitors
First Republic Bank ADR H 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.
High dependence on First Republic Bank ADR H ‘s star products
– The top 2 products and services of First Republic Bank ADR H still accounts for major business revenue. This dependence on star products in industry has resulted into insufficient focus on developing new products, even though First Republic Bank ADR H has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of First Republic Bank ADR H is dominated by functional specialists. It is not different from other players in the industry, but First Republic Bank ADR H needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help First Republic Bank ADR H to focus more on services in the industry rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As First Republic Bank ADR H is one of the leading players in the industry, it 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.
Lack of clear differentiation of First Republic Bank ADR H products
– To increase the profitability and margins on the products, First Republic Bank ADR H 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, First Republic Bank ADR H is slow explore the new channels of communication. These new channels of communication can help First Republic Bank ADR H to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, First Republic Bank ADR H 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. First Republic Bank ADR H 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.
Ability to respond to the competition
– As the decision making is very deliberative at First Republic Bank ADR H, in the dynamic environment of industry it has struggled to respond to the nimble upstart competition. First Republic Bank ADR H has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, First Republic Bank ADR H 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’ less understanding of First Republic Bank ADR H strategy
– From the outside it seems that the employees of First Republic Bank ADR H 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
– From the 10K / annual statement of First Republic Bank ADR H, it seems that company is thinking out the frontier risks that can impact industry. 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.
First Republic Bank ADR H Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of First Republic Bank ADR H are -
Use of Bitcoin and other crypto currencies for transactions in industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for First Republic Bank ADR H in the industry. Now First Republic Bank ADR H can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, First Republic Bank ADR H 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.
Using analytics as competitive advantage
– First Republic Bank ADR H has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in sector. This continuous investment in analytics has enabled First Republic Bank ADR H to build a competitive advantage using analytics. The analytics driven competitive advantage can help First Republic Bank ADR H 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, First Republic Bank ADR H is facing challenges because of the dominance of functional experts in the organization. First Republic Bank ADR H can utilize new technology in the field of industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Leveraging digital technologies
– First Republic Bank ADR H 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.
Learning at scale
– Online learning technologies has now opened space for First Republic Bank ADR H 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.
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. First Republic Bank ADR H can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects First Republic Bank ADR H can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, First Republic Bank ADR H can use these opportunities to build new business models that can help the communities that First Republic Bank ADR H operates in. Secondly it can use opportunities from government spending in sector.
Creating value in data economy
– The success of analytics program of First Republic Bank ADR H has opened avenues for new revenue streams for the organization in industry. This can help First Republic Bank ADR H to build a more holistic ecosystem for First Republic Bank ADR H products in the industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– First Republic Bank ADR H can develop new processes and procedures in 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, First Republic Bank ADR H 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 First Republic Bank ADR H to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at First Republic Bank ADR H 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 industry.
Threats First Republic Bank ADR H External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of First Republic Bank ADR H are -
High dependence on third party suppliers
– First Republic Bank ADR H 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.
Easy access to finance
– Easy access to finance in industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. First Republic Bank ADR H can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that First Republic Bank ADR H is facing in sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. First Republic Bank ADR H needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Consumer confidence and its impact on First Republic Bank ADR H 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 industry and other sectors.
Increasing wage structure of First Republic Bank ADR H
– 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 First Republic Bank ADR H.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, First Republic Bank ADR H 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 First Republic Bank ADR H prominent markets.
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. First Republic Bank ADR H 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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Environmental challenges
– First Republic Bank ADR H 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. First Republic Bank ADR H can take advantage of this fund but it will also bring new competitors in the industry.
Regulatory challenges
– First Republic Bank ADR H 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 industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for First Republic Bank ADR H in industry. The 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.
Weighted SWOT Analysis of First Republic Bank ADR H Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at First Republic Bank ADR H 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 First Republic Bank ADR H 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 First Republic Bank ADR H 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 First Republic Bank ADR H 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 First Republic Bank ADR H needs to make to build a sustainable competitive advantage.