Based on various researches at Oak Spring University , Flaherty & Crumrine Preferredome is operating in a macro-environment that has been destablized by – increasing commodity prices, central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%,
competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Flaherty & Crumrine Preferredome
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Flaherty & Crumrine Preferredome can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Flaherty & Crumrine Preferredome, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome can be done for the following purposes –
1. Strategic planning of Flaherty & Crumrine Preferredome
2. Improving business portfolio management of Flaherty & Crumrine Preferredome
3. Assessing feasibility of the new initiative in United States
4. Making a Misc. Financial Services sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Flaherty & Crumrine Preferredome
Strengths of Flaherty & Crumrine Preferredome | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Flaherty & Crumrine Preferredome are -
Sustainable margins compare to other players in Misc. Financial Services industry
– Flaherty & Crumrine Preferredome has clearly differentiated products in the market place. This has enabled Flaherty & Crumrine Preferredome to fetch slight price premium compare to the competitors in the Misc. Financial Services industry. The sustainable margins have also helped Flaherty & Crumrine Preferredome to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy of Flaherty & Crumrine Preferredome comprises – understanding the underlying the factors in the Misc. Financial Services 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.
High brand equity
– Flaherty & Crumrine Preferredome has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Flaherty & Crumrine Preferredome to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Flaherty & Crumrine Preferredome in the Financial sector have low bargaining power. Flaherty & Crumrine Preferredome has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Flaherty & Crumrine Preferredome to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Flaherty & Crumrine Preferredome is present in almost all the verticals within the Misc. Financial Services industry. This has provided Flaherty & Crumrine Preferredome a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Analytics focus
– Flaherty & Crumrine Preferredome 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 Misc. Financial Services 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.
Organizational Resilience of Flaherty & Crumrine Preferredome
– The covid-19 pandemic has put organizational resilience at the centre of everthing Flaherty & Crumrine Preferredome does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Misc. Financial Services industry
- digital transformation varies from industry to industry. For Flaherty & Crumrine Preferredome digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Flaherty & Crumrine Preferredome 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.
Learning organization
- Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Flaherty & Crumrine Preferredome emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Flaherty & Crumrine Preferredome is one of the leading players in the Misc. Financial Services 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.
Ability to lead change in Misc. Financial Services
– Flaherty & Crumrine Preferredome is one of the leading players in the Misc. Financial Services industry in United States. Over the years it has not only transformed the business landscape in the Misc. Financial Services industry in United States but also across the existing markets. The ability to lead change has enabled Flaherty & Crumrine Preferredome in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Flaherty & Crumrine Preferredome is one of the most innovative firm in Misc. Financial Services sector.
Weaknesses of Flaherty & Crumrine Preferredome | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Flaherty & Crumrine Preferredome are -
Need for greater diversity
– Flaherty & Crumrine Preferredome 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.
Interest costs
– Compare to the competition, Flaherty & Crumrine Preferredome 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.
Compensation and incentives
– The revenue per employee of Flaherty & Crumrine Preferredome is just above the Misc. Financial Services 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.
Lack of clear differentiation of Flaherty & Crumrine Preferredome products
– To increase the profitability and margins on the products, Flaherty & Crumrine Preferredome needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Flaherty & Crumrine Preferredome has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Misc. Financial Services industry over the last five years. Flaherty & Crumrine Preferredome 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.
No frontier risks strategy
– From the 10K / annual statement of Flaherty & Crumrine Preferredome, it seems that company is thinking out the frontier risks that can impact Misc. Financial Services 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.
Low market penetration in new markets
– Outside its home market of United States, Flaherty & Crumrine Preferredome needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Flaherty & Crumrine Preferredome has some of the most successful models in the Misc. Financial Services industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Flaherty & Crumrine Preferredome should strive to include more intangible value offerings along with its core products and services.
High dependence on Flaherty & Crumrine Preferredome ‘s star products
– The top 2 products and services of Flaherty & Crumrine Preferredome still accounts for major business revenue. This dependence on star products in Misc. Financial Services industry has resulted into insufficient focus on developing new products, even though Flaherty & Crumrine Preferredome has relatively successful track record of launching new products.
High cash cycle compare to competitors
Flaherty & Crumrine Preferredome has a high cash cycle compare to other players in the Misc. Financial Services industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Ability to respond to the competition
– As the decision making is very deliberative at Flaherty & Crumrine Preferredome, in the dynamic environment of Misc. Financial Services industry it has struggled to respond to the nimble upstart competition. Flaherty & Crumrine Preferredome has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Flaherty & Crumrine Preferredome Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Flaherty & Crumrine Preferredome are -
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. Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome has opened avenues for new revenue streams for the organization in Misc. Financial Services industry. This can help Flaherty & Crumrine Preferredome to build a more holistic ecosystem for Flaherty & Crumrine Preferredome products in the Misc. Financial Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Flaherty & Crumrine Preferredome to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Using analytics as competitive advantage
– Flaherty & Crumrine Preferredome has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Misc. Financial Services sector. This continuous investment in analytics has enabled Flaherty & Crumrine Preferredome to build a competitive advantage using analytics. The analytics driven competitive advantage can help Flaherty & Crumrine Preferredome to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Flaherty & Crumrine Preferredome 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.
Building a culture of innovation
– managers at Flaherty & Crumrine Preferredome 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 Misc. Financial Services industry.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the Misc. Financial Services industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Flaherty & Crumrine Preferredome 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. Flaherty & Crumrine Preferredome 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.
Loyalty marketing
– Flaherty & Crumrine Preferredome 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Flaherty & Crumrine Preferredome can use these opportunities to build new business models that can help the communities that Flaherty & Crumrine Preferredome operates in. Secondly it can use opportunities from government spending in Misc. Financial Services sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Flaherty & Crumrine Preferredome can improve the customer journey of consumers in the Misc. Financial Services 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.
Better consumer reach
– The expansion of the 5G network will help Flaherty & Crumrine Preferredome to increase its market reach. Flaherty & Crumrine Preferredome 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Flaherty & Crumrine Preferredome can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Flaherty & Crumrine Preferredome External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Flaherty & Crumrine Preferredome are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Flaherty & Crumrine Preferredome may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Misc. Financial Services sector.
Regulatory challenges
– Flaherty & Crumrine Preferredome 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 Misc. Financial Services industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Flaherty & Crumrine Preferredome in Misc. Financial Services industry. The Misc. Financial Services 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.
Environmental challenges
– Flaherty & Crumrine Preferredome 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. Flaherty & Crumrine Preferredome can take advantage of this fund but it will also bring new competitors in the Misc. Financial Services 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 Flaherty & Crumrine Preferredome business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Misc. Financial Services industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Flaherty & Crumrine Preferredome can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Misc. Financial Services industry are lowering. It can presents Flaherty & Crumrine Preferredome with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Misc. Financial Services sector.
Consumer confidence and its impact on Flaherty & Crumrine Preferredome 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 Misc. Financial Services industry and other sectors.
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 Flaherty & Crumrine Preferredome in the Misc. Financial Services sector and impact the bottomline of the organization.
Increasing wage structure of Flaherty & Crumrine Preferredome
– 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 Flaherty & Crumrine Preferredome.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome prominent markets.
Technology acceleration in Forth Industrial Revolution
– Flaherty & Crumrine Preferredome has witnessed rapid integration of technology during Covid-19 in the Misc. Financial Services industry. As one of the leading players in the industry, Flaherty & Crumrine Preferredome needs to keep up with the evolution of technology in the Misc. Financial Services 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.
Shortening product life cycle
– it is one of the major threat that Flaherty & Crumrine Preferredome is facing in Misc. Financial Services sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Flaherty & Crumrine Preferredome Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome 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 Flaherty & Crumrine Preferredome needs to make to build a sustainable competitive advantage.