Based on various researches at Oak Spring University , Flaherty & Crumrine Preferred Oppty is operating in a macro-environment that has been destablized by – increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, increasing household debt because of falling income levels,
increasing transportation and logistics costs, wage bills are increasing, etc
Introduction to SWOT Analysis of Flaherty & Crumrine Preferred Oppty
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Flaherty & Crumrine Preferred Oppty can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Flaherty & Crumrine Preferred Oppty, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Flaherty & Crumrine Preferred Oppty 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 Preferred Oppty can be done for the following purposes –
1. Strategic planning of Flaherty & Crumrine Preferred Oppty
2. Improving business portfolio management of Flaherty & Crumrine Preferred Oppty
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 Preferred Oppty
Strengths of Flaherty & Crumrine Preferred Oppty | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Flaherty & Crumrine Preferred Oppty are -
High switching costs
– The high switching costs that Flaherty & Crumrine Preferred Oppty 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.
Sustainable margins compare to other players in Misc. Financial Services industry
– Flaherty & Crumrine Preferred Oppty has clearly differentiated products in the market place. This has enabled Flaherty & Crumrine Preferred Oppty to fetch slight price premium compare to the competitors in the Misc. Financial Services industry. The sustainable margins have also helped Flaherty & Crumrine Preferred Oppty to invest into research and development (R&D) and innovation.
Training and development
– Flaherty & Crumrine Preferred Oppty has one of the best training and development program in Financial 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.
Ability to lead change in Misc. Financial Services
– Flaherty & Crumrine Preferred Oppty 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 Preferred Oppty in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Flaherty & Crumrine Preferred Oppty in the Financial sector have low bargaining power. Flaherty & Crumrine Preferred Oppty has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Flaherty & Crumrine Preferred Oppty to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Flaherty & Crumrine Preferred Oppty has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Flaherty & Crumrine Preferred Oppty staying ahead in the Misc. Financial Services industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Flaherty & Crumrine Preferred Oppty has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Flaherty & Crumrine Preferred Oppty to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Flaherty & Crumrine Preferred Oppty is one of the most innovative firm in Misc. Financial Services sector.
Successful track record of launching new products
– Flaherty & Crumrine Preferred Oppty has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Flaherty & Crumrine Preferred Oppty 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.
Learning organization
- Flaherty & Crumrine Preferred Oppty 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 Preferred Oppty is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Flaherty & Crumrine Preferred Oppty emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Flaherty & Crumrine Preferred Oppty are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Analytics focus
– Flaherty & Crumrine Preferred Oppty 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.
Weaknesses of Flaherty & Crumrine Preferred Oppty | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Flaherty & Crumrine Preferred Oppty are -
Products dominated business model
– Even though Flaherty & Crumrine Preferred Oppty 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 Preferred Oppty should strive to include more intangible value offerings along with its core products and services.
Capital Spending Reduction
– Even during the low interest decade, Flaherty & Crumrine Preferred Oppty 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 Misc. Financial Services industry using digital technology.
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 Flaherty & Crumrine Preferred Oppty supply chain. Even after few cautionary changes, Flaherty & Crumrine Preferred Oppty is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Flaherty & Crumrine Preferred Oppty vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee of Flaherty & Crumrine Preferred Oppty 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Flaherty & Crumrine Preferred Oppty is slow explore the new channels of communication. These new channels of communication can help Flaherty & Crumrine Preferred Oppty to provide better information regarding Misc. Financial Services products and services. It can also build an online community to further reach out to potential customers.
Slow to strategic competitive environment developments
– As Flaherty & Crumrine Preferred Oppty is one of the leading players in the Misc. Financial Services industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Misc. Financial Services industry in last five years.
Skills based hiring in Misc. Financial Services industry
– The stress on hiring functional specialists at Flaherty & Crumrine Preferred Oppty 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.
Lack of clear differentiation of Flaherty & Crumrine Preferred Oppty products
– To increase the profitability and margins on the products, Flaherty & Crumrine Preferred Oppty needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Flaherty & Crumrine Preferred Oppty is dominated by functional specialists. It is not different from other players in the Misc. Financial Services industry, but Flaherty & Crumrine Preferred Oppty needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Flaherty & Crumrine Preferred Oppty to focus more on services in the Misc. Financial Services industry rather than just following the product oriented approach.
Need for greater diversity
– Flaherty & Crumrine Preferred Oppty 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.
High bargaining power of channel partners in Misc. Financial Services industry
– because of the regulatory requirements in United States, Flaherty & Crumrine Preferred Oppty 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 Misc. Financial Services industry.
Flaherty & Crumrine Preferred Oppty Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Flaherty & Crumrine Preferred Oppty are -
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 Preferred Oppty 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 Preferred Oppty 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.
Learning at scale
– Online learning technologies has now opened space for Flaherty & Crumrine Preferred Oppty 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.
Loyalty marketing
– Flaherty & Crumrine Preferred Oppty 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Flaherty & Crumrine Preferred Oppty in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Misc. Financial Services industry, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Flaherty & Crumrine Preferred Oppty has opened avenues for new revenue streams for the organization in Misc. Financial Services industry. This can help Flaherty & Crumrine Preferred Oppty to build a more holistic ecosystem for Flaherty & Crumrine Preferred Oppty products in the Misc. Financial Services industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Flaherty & Crumrine Preferred Oppty can develop new processes and procedures in Misc. Financial Services 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.
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 Preferred Oppty can use these opportunities to build new business models that can help the communities that Flaherty & Crumrine Preferred Oppty 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 Preferred Oppty 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 Preferred Oppty to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Use of Bitcoin and other crypto currencies for transactions in Misc. Financial Services industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Flaherty & Crumrine Preferred Oppty in the Misc. Financial Services industry. Now Flaherty & Crumrine Preferred Oppty can target international markets with far fewer capital restrictions requirements than the existing system.
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 Preferred Oppty can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Flaherty & Crumrine Preferred Oppty 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.
Manufacturing automation
– Flaherty & Crumrine Preferred Oppty can use the latest technology developments to improve its manufacturing and designing process in Misc. Financial Services 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.
Building a culture of innovation
– managers at Flaherty & Crumrine Preferred Oppty 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.
Threats Flaherty & Crumrine Preferred Oppty External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Flaherty & Crumrine Preferred Oppty are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Flaherty & Crumrine Preferred Oppty 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.
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 Flaherty & Crumrine Preferred Oppty.
Regulatory challenges
– Flaherty & Crumrine Preferred Oppty 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.
Environmental challenges
– Flaherty & Crumrine Preferred Oppty 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 Preferred Oppty can take advantage of this fund but it will also bring new competitors in the Misc. Financial Services industry.
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. Flaherty & Crumrine Preferred Oppty will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
High dependence on third party suppliers
– Flaherty & Crumrine Preferred Oppty 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.
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. Flaherty & Crumrine Preferred Oppty needs to understand the core reasons impacting the Misc. Financial Services 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 Flaherty & Crumrine Preferred Oppty 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.
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.
Stagnating economy with rate increase
– Flaherty & Crumrine Preferred Oppty 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 Misc. Financial Services industry.
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 Preferred Oppty in the Misc. Financial Services sector and impact the bottomline 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.
Increasing wage structure of Flaherty & Crumrine Preferred Oppty
– 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 Preferred Oppty.
Weighted SWOT Analysis of Flaherty & Crumrine Preferred Oppty Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Flaherty & Crumrine Preferred Oppty 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 Preferred Oppty 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 Preferred Oppty 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 Preferred Oppty 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 Preferred Oppty needs to make to build a sustainable competitive advantage.