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 – digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, geopolitical disruptions, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, increasing commodity prices,
banking and financial system is disrupted by Bitcoin and other crypto currencies, talent flight as more people leaving formal jobs, 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 -
Strong track record of project management in the industry
– John Hancock Hedged Equity & Income is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at John Hancock Hedged Equity & Income emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of John Hancock Hedged Equity & Income in industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in industry
- digital transformation varies from industry to industry. For John Hancock Hedged Equity & Income digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. John Hancock Hedged Equity & Income has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Analytics focus
– John Hancock Hedged Equity & Income 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.
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.
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.
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.
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.
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 -
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.
Slow to strategic competitive environment developments
– As John Hancock Hedged Equity & Income 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.
Slow decision making process
– As mentioned earlier in the report, John Hancock Hedged Equity & Income 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. John Hancock Hedged Equity & Income 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.
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.
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.
Lack of clear differentiation of John Hancock Hedged Equity & Income products
– To increase the profitability and margins on the products, John Hancock Hedged Equity & Income needs to provide more differentiated products than what it is currently offering in the marketplace.
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.
No frontier risks strategy
– From the 10K / annual statement of John Hancock Hedged Equity & Income, 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.
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.
High dependence on John Hancock Hedged Equity & Income ‘s star products
– The top 2 products and services of John Hancock Hedged Equity & Income still accounts for major business revenue. This dependence on star products in industry has resulted into insufficient focus on developing new products, even though John Hancock Hedged Equity & Income has relatively successful track record of launching new products.
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.
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 -
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.
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.
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.
Learning at scale
– Online learning technologies has now opened space for John Hancock Hedged Equity & Income 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.
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.
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.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, John Hancock Hedged Equity & Income can use these opportunities to build new business models that can help the communities that John Hancock Hedged Equity & Income operates in. Secondly it can use opportunities from government spending in sector.
Manufacturing automation
– John Hancock Hedged Equity & Income can use the latest technology developments to improve its manufacturing and designing process in sector. 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.
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.
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.
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.
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 -
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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for John Hancock Hedged Equity & Income 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to industry are lowering. It can presents John Hancock Hedged Equity & Income with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, John Hancock Hedged Equity & Income 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 John Hancock Hedged Equity & Income prominent markets.
Increasing wage structure of John Hancock Hedged Equity & Income
– 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 John Hancock Hedged Equity & Income.
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.
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.
Regulatory challenges
– John Hancock Hedged Equity & Income 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.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of John Hancock Hedged Equity & Income.
Environmental challenges
– John Hancock Hedged Equity & Income 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. John Hancock Hedged Equity & Income can take advantage of this fund but it will also bring new competitors in the industry.
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.
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.
