Swot Analysis of "ABB (C): The Centerman Era (2001-2002)" written by Paul Strebel, Nanci Govinder includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Centerman Abb facing as an external strategic factors. Some of the topics covered in ABB (C): The Centerman Era (2001-2002) case study are - Strategic Management Strategies, Leadership, Mergers & acquisitions, Negotiations, Organizational structure, Reorganization and Organizational Development.
Some of the macro environment factors that can be used to understand the ABB (C): The Centerman Era (2001-2002) casestudy better are - – there is increasing trade war between United States & China, supply chains are disrupted by pandemic , increasing energy prices, talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing,
there is backlash against globalization, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of ABB (C): The Centerman Era (2001-2002)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in ABB (C): The Centerman Era (2001-2002) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Centerman Abb, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Centerman Abb 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 ABB (C): The Centerman Era (2001-2002) can be done for the following purposes –
1. Strategic planning using facts provided in ABB (C): The Centerman Era (2001-2002) case study
2. Improving business portfolio management of Centerman Abb
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Centerman Abb
Strengths ABB (C): The Centerman Era (2001-2002) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Centerman Abb in ABB (C): The Centerman Era (2001-2002) Harvard Business Review case study are -
Organizational Resilience of Centerman Abb
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Centerman Abb does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Centerman Abb 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 Centerman Abb is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in ABB (C): The Centerman Era (2001-2002) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Centerman Abb digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Centerman Abb 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.
Highly skilled collaborators
– Centerman Abb 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 ABB (C): The Centerman Era (2001-2002) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Centerman Abb is one of the most innovative firm in sector. Manager in ABB (C): The Centerman Era (2001-2002) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Centerman Abb has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study ABB (C): The Centerman Era (2001-2002) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High brand equity
– Centerman Abb has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Centerman Abb to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Centerman Abb in the sector have low bargaining power. ABB (C): The Centerman Era (2001-2002) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Centerman Abb to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Centerman Abb 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
– Centerman Abb has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in ABB (C): The Centerman Era (2001-2002) 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.
Operational resilience
– The operational resilience strategy in the ABB (C): The Centerman Era (2001-2002) 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.
Ability to lead change in Organizational Development field
– Centerman Abb 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 Centerman Abb in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses ABB (C): The Centerman Era (2001-2002) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of ABB (C): The Centerman Era (2001-2002) are -
High operating costs
– Compare to the competitors, firm in the HBR case study ABB (C): The Centerman Era (2001-2002) has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Centerman Abb 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study ABB (C): The Centerman Era (2001-2002), it seems that the employees of Centerman Abb 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.
Slow to strategic competitive environment developments
– As ABB (C): The Centerman Era (2001-2002) HBR case study mentions - Centerman Abb 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.
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 Centerman Abb supply chain. Even after few cautionary changes mentioned in the HBR case study - ABB (C): The Centerman Era (2001-2002), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Centerman Abb vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Centerman Abb 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study ABB (C): The Centerman Era (2001-2002), in the dynamic environment Centerman Abb has struggled to respond to the nimble upstart competition. Centerman Abb has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Centerman Abb has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Increasing silos among functional specialists
– The organizational structure of Centerman Abb is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Centerman Abb needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Centerman Abb to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study ABB (C): The Centerman Era (2001-2002), is just above the industry average. Centerman Abb needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Low market penetration in new markets
– Outside its home market of Centerman Abb, firm in the HBR case study ABB (C): The Centerman Era (2001-2002) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Centerman Abb 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.
Opportunities ABB (C): The Centerman Era (2001-2002) | 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 ABB (C): The Centerman Era (2001-2002) are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Centerman Abb can use these opportunities to build new business models that can help the communities that Centerman Abb operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Learning at scale
– Online learning technologies has now opened space for Centerman Abb 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Centerman Abb 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, as suggested in case study, ABB (C): The Centerman Era (2001-2002), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Centerman Abb can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Centerman Abb can use the latest technology developments to improve its manufacturing and designing process in Organizational Development 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Organizational Development industry, but it has also influenced the consumer preferences. Centerman Abb can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Low interest rates
– Even though inflation is raising its head in most developed economies, Centerman Abb 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Centerman Abb in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Centerman Abb to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Centerman Abb to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Centerman Abb 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.
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 Centerman Abb in the consumer business. Now Centerman Abb 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. Centerman Abb 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 Centerman Abb has opened avenues for new revenue streams for the organization in the industry. This can help Centerman Abb to build a more holistic ecosystem as suggested in the ABB (C): The Centerman Era (2001-2002) case study. Centerman Abb can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats ABB (C): The Centerman Era (2001-2002) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study ABB (C): The Centerman Era (2001-2002) are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Centerman Abb with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Centerman Abb is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Centerman Abb 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. Centerman Abb can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Regulatory challenges
– Centerman Abb 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 Organizational Development industry regulations.
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. Centerman Abb needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study ABB (C): The Centerman Era (2001-2002), Centerman Abb may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .
Technology acceleration in Forth Industrial Revolution
– Centerman Abb has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Centerman Abb needs to keep up with the evolution of technology in the Organizational Development 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.
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 Centerman Abb in the Organizational Development sector and impact the bottomline of the organization.
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 Centerman Abb business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Centerman Abb can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Centerman Abb in the Organizational Development industry. The Organizational Development 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.
Consumer confidence and its impact on Centerman Abb 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Centerman Abb 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 prominent markets illustrated in HBR case study ABB (C): The Centerman Era (2001-2002) .
Weighted SWOT Analysis of ABB (C): The Centerman Era (2001-2002) 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 ABB (C): The Centerman Era (2001-2002) 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 ABB (C): The Centerman Era (2001-2002) 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 ABB (C): The Centerman Era (2001-2002) 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 ABB (C): The Centerman Era (2001-2002) 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 Centerman Abb needs to make to build a sustainable competitive advantage.