CHANGING THE CULTURE AT XYZ AIRLINES SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of CHANGING THE CULTURE AT XYZ AIRLINES
Well aware of your experience and keen intuition, the newly appointed Chief Executive Officer of XYZ Airlines, James Sanchez, is asking for your help. The airline is loss-making, has a record of poor customer service, and is the result of an undigested merger several years ago. Sanchez took over as chief executive of XYZ Airlines a month ago. Well-known for his almost single-minded focus on customer service, he wants to create a service culture in the airline while continuing to cut costs. He is asking for your help to decide what he should do to create this culture change and to estimate how long it will take to succeed. Learning objectives: Participants are challenged to think about the critical success factors for changing the culture of an organization.
Swot Analysis of "CHANGING THE CULTURE AT XYZ AIRLINES" written by John Weeks includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Xyz Sanchez facing as an external strategic factors. Some of the topics covered in CHANGING THE CULTURE AT XYZ AIRLINES case study are - Strategic Management Strategies, Organizational culture and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the CHANGING THE CULTURE AT XYZ AIRLINES casestudy better are - – increasing energy prices, there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, geopolitical disruptions, increasing transportation and logistics costs, talent flight as more people leaving formal jobs,
increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of CHANGING THE CULTURE AT XYZ AIRLINES
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CHANGING THE CULTURE AT XYZ AIRLINES case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Xyz Sanchez, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Xyz Sanchez 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 CHANGING THE CULTURE AT XYZ AIRLINES can be done for the following purposes –
1. Strategic planning using facts provided in CHANGING THE CULTURE AT XYZ AIRLINES case study
2. Improving business portfolio management of Xyz Sanchez
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Xyz Sanchez
Strengths CHANGING THE CULTURE AT XYZ AIRLINES | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Xyz Sanchez in CHANGING THE CULTURE AT XYZ AIRLINES Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the CHANGING THE CULTURE AT XYZ AIRLINES Harvard Business Review case study 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.
Successful track record of launching new products
– Xyz Sanchez has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Xyz Sanchez 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.
Ability to lead change in Leadership & Managing People field
– Xyz Sanchez is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Xyz Sanchez in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Xyz Sanchez is one of the most innovative firm in sector. Manager in CHANGING THE CULTURE AT XYZ AIRLINES Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Xyz Sanchez has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in CHANGING THE CULTURE AT XYZ AIRLINES HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Strong track record of project management
– Xyz Sanchez is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Xyz Sanchez has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in CHANGING THE CULTURE AT XYZ AIRLINES Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Diverse revenue streams
– Xyz Sanchez is present in almost all the verticals within the industry. This has provided firm in CHANGING THE CULTURE AT XYZ AIRLINES case study 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Xyz Sanchez digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Xyz Sanchez 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.
Organizational Resilience of Xyz Sanchez
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Xyz Sanchez does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Leadership & Managing People industry
– CHANGING THE CULTURE AT XYZ AIRLINES firm has clearly differentiated products in the market place. This has enabled Xyz Sanchez to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Xyz Sanchez to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Xyz Sanchez 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.
Weaknesses CHANGING THE CULTURE AT XYZ AIRLINES | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CHANGING THE CULTURE AT XYZ AIRLINES are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study CHANGING THE CULTURE AT XYZ AIRLINES, it seems that the employees of Xyz Sanchez don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
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 Xyz Sanchez supply chain. Even after few cautionary changes mentioned in the HBR case study - CHANGING THE CULTURE AT XYZ AIRLINES, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Xyz Sanchez vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Xyz Sanchez 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Xyz Sanchez needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow decision making process
– As mentioned earlier in the report, Xyz Sanchez 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. Xyz Sanchez 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.
High cash cycle compare to competitors
Xyz Sanchez 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.
Skills based hiring
– The stress on hiring functional specialists at Xyz Sanchez 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the CHANGING THE CULTURE AT XYZ AIRLINES HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Xyz Sanchez has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study CHANGING THE CULTURE AT XYZ AIRLINES, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study CHANGING THE CULTURE AT XYZ AIRLINES, in the dynamic environment Xyz Sanchez has struggled to respond to the nimble upstart competition. Xyz Sanchez has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Xyz Sanchez, firm in the HBR case study CHANGING THE CULTURE AT XYZ AIRLINES needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities CHANGING THE CULTURE AT XYZ AIRLINES | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study CHANGING THE CULTURE AT XYZ AIRLINES are -
Manufacturing automation
– Xyz Sanchez can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People segment. 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.
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. Xyz Sanchez can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Xyz Sanchez in the consumer business. Now Xyz Sanchez can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Xyz Sanchez 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. Xyz Sanchez 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Xyz Sanchez in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Xyz Sanchez can use these opportunities to build new business models that can help the communities that Xyz Sanchez operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Loyalty marketing
– Xyz Sanchez 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.
Buying journey improvements
– Xyz Sanchez can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. CHANGING THE CULTURE AT XYZ AIRLINES suggest that firm 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.
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 Xyz Sanchez 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.
Creating value in data economy
– The success of analytics program of Xyz Sanchez has opened avenues for new revenue streams for the organization in the industry. This can help Xyz Sanchez to build a more holistic ecosystem as suggested in the CHANGING THE CULTURE AT XYZ AIRLINES case study. Xyz Sanchez can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Xyz Sanchez can develop new processes and procedures in Leadership & Managing People 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.
Building a culture of innovation
– managers at Xyz Sanchez 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 Leadership & Managing People segment.
Leveraging digital technologies
– Xyz Sanchez 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.
Threats CHANGING THE CULTURE AT XYZ AIRLINES External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CHANGING THE CULTURE AT XYZ AIRLINES are -
Technology acceleration in Forth Industrial Revolution
– Xyz Sanchez has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Xyz Sanchez needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Xyz Sanchez with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Xyz Sanchez 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 the industry and other sectors.
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 Xyz Sanchez.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study CHANGING THE CULTURE AT XYZ AIRLINES, Xyz Sanchez may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
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 Xyz Sanchez in the Leadership & Managing People sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Xyz Sanchez 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. Xyz Sanchez needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Xyz Sanchez can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Xyz Sanchez is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Xyz Sanchez 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.
Regulatory challenges
– Xyz Sanchez 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 Leadership & Managing People industry regulations.
Stagnating economy with rate increase
– Xyz Sanchez 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 field.
Weighted SWOT Analysis of CHANGING THE CULTURE AT XYZ AIRLINES Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study CHANGING THE CULTURE AT XYZ AIRLINES 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 the case study CHANGING THE CULTURE AT XYZ AIRLINES 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 the Harvard case study CHANGING THE CULTURE AT XYZ AIRLINES 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 CHANGING THE CULTURE AT XYZ AIRLINES is 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 Xyz Sanchez needs to make to build a sustainable competitive advantage.
