John Hancock Hedged Equity & Income (HEQ) SWOT Analysis / TOWS Matrix / MBA Resources
Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for John Hancock Hedged Equity & Income (United States)
Based on various researches at Oak Spring University , John Hancock Hedged Equity & Income is operating in a macro-environment that has been destablized by – challanges to central banks by blockchain based private currencies, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, increasing transportation and logistics costs,
wage bills are increasing, there is backlash against globalization, etc
Introduction to SWOT Analysis of John Hancock Hedged Equity & Income
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that John Hancock Hedged Equity & Income can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the John Hancock Hedged Equity & Income, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income can be done for the following purposes –
1. Strategic planning of John Hancock Hedged Equity & Income
2. Improving business portfolio management of John Hancock Hedged Equity & Income
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 John Hancock Hedged Equity & Income
Strengths of John Hancock Hedged Equity & Income | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of John Hancock Hedged Equity & Income are -
Effective Research and Development (R&D)
– John Hancock Hedged Equity & Income has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – John Hancock Hedged Equity & Income staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy of John Hancock Hedged Equity & Income 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.
Ability to lead change in
– John Hancock Hedged Equity & Income is one of the leading players in the industry in United States. Over the years it has not only transformed the business landscape in the industry in United States but also across the existing markets. The ability to lead change has enabled John Hancock Hedged Equity & Income 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
– John Hancock Hedged Equity & Income has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. John Hancock Hedged Equity & Income 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
– John Hancock Hedged Equity & Income is one of the most innovative firm in sector.
Ability to recruit top talent
– John Hancock Hedged Equity & Income 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.
Training and development
– John Hancock Hedged Equity & Income 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.
Low bargaining power of suppliers
– Suppliers of John Hancock Hedged Equity & Income in the sector have low bargaining power. John Hancock Hedged Equity & Income has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps John Hancock Hedged Equity & Income to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that John Hancock Hedged Equity & Income 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.
Cross disciplinary teams
– Horizontal connected teams at the John Hancock Hedged Equity & Income 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.
High brand equity
– John Hancock Hedged Equity & Income has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled John Hancock Hedged Equity & Income to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of John Hancock Hedged Equity & Income | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of John Hancock Hedged Equity & Income are -
Aligning sales with marketing
– From the outside it seems that John Hancock Hedged Equity & Income 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 at John Hancock Hedged Equity & Income can leverage the sales team experience to cultivate customer relationships as John Hancock Hedged Equity & Income is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, John Hancock Hedged Equity & Income 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.
Skills based hiring in industry
– The stress on hiring functional specialists at John Hancock Hedged Equity & Income has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High cash cycle compare to competitors
John Hancock Hedged Equity & Income 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.
Compensation and incentives
– The revenue per employee of John Hancock Hedged Equity & Income is just above the industry average. It 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.
Low market penetration in new markets
– Outside its home market of United States, John Hancock Hedged Equity & Income needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– John Hancock Hedged Equity & Income has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Increasing silos among functional specialists
– The organizational structure of John Hancock Hedged Equity & Income is dominated by functional specialists. It is not different from other players in the industry, but John Hancock Hedged Equity & Income needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help John Hancock Hedged Equity & Income to focus more on services in the industry rather than just following the product oriented approach.
High bargaining power of channel partners in industry
– because of the regulatory requirements in United States, John Hancock Hedged Equity & Income 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.
Interest costs
– Compare to the competition, John Hancock Hedged Equity & Income 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.
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 John Hancock Hedged Equity & Income supply chain. Even after few cautionary changes, John Hancock Hedged Equity & Income is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left John Hancock Hedged Equity & Income vulnerable to further global disruptions in South East Asia.
John Hancock Hedged Equity & Income Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of John Hancock Hedged Equity & Income are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, John Hancock Hedged Equity & Income is facing challenges because of the dominance of functional experts in the organization. John Hancock Hedged Equity & Income 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.
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. John Hancock Hedged Equity & Income can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– John Hancock Hedged Equity & Income 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects John Hancock Hedged Equity & Income can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help John Hancock Hedged Equity & Income 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.
Buying journey improvements
– John Hancock Hedged Equity & Income can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Low interest rates
– Even though inflation is raising its head in most developed economies, John Hancock Hedged Equity & Income 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.
Loyalty marketing
– John Hancock Hedged Equity & Income 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
– John Hancock Hedged Equity & Income 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.
Better consumer reach
– The expansion of the 5G network will help John Hancock Hedged Equity & Income to increase its market reach. John Hancock Hedged Equity & Income 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.
Creating value in data economy
– The success of analytics program of John Hancock Hedged Equity & Income has opened avenues for new revenue streams for the organization in industry. This can help John Hancock Hedged Equity & Income to build a more holistic ecosystem for John Hancock Hedged Equity & Income products in the industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at John Hancock Hedged Equity & Income 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for John Hancock Hedged Equity & Income in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the industry, and it will provide faster access to the consumers.
Threats John Hancock Hedged Equity & Income External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of John Hancock Hedged Equity & Income are -
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for John Hancock Hedged Equity & Income in the sector and impact the bottomline of the organization.
High dependence on third party suppliers
– John Hancock Hedged Equity & Income 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.
Stagnating economy with rate increase
– John Hancock Hedged Equity & Income 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 industry.
Shortening product life cycle
– it is one of the major threat that John Hancock Hedged Equity & Income is facing in sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– John Hancock Hedged Equity & Income has witnessed rapid integration of technology during Covid-19 in the industry. As one of the leading players in the industry, John Hancock Hedged Equity & Income needs to keep up with the evolution of technology in the 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, John Hancock Hedged Equity & Income may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of 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 John Hancock Hedged Equity & Income business can come under increasing regulations regarding data privacy, data security, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
High 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. John Hancock Hedged Equity & Income needs to understand the core reasons impacting the industry. This will help it in building a better workplace.
Consumer confidence and its impact on John Hancock Hedged Equity & Income 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.
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. John Hancock Hedged Equity & Income 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.
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.
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. John Hancock Hedged Equity & Income can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of John Hancock Hedged Equity & Income Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income needs to make to build a sustainable competitive advantage.