Otis Elevator: Accelerating Business Transformation with IT, Chinese Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Otis Elevator: Accelerating Business Transformation with IT, Chinese Version
Focuses on a major transformation of Otis Elevator's infrastructure. Led by the CEO, this transformation represents a remarkable long-term reengineering of all the processes of the firm to drive its operating costs down and service image up. The transformation is the continuation of a process that has been going on for more than 20 years.
Swot Analysis of "Otis Elevator: Accelerating Business Transformation with IT, Chinese Version" written by F. Warren McFarlan, Brian J. Delacey includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Transformation Otis facing as an external strategic factors. Some of the topics covered in Otis Elevator: Accelerating Business Transformation with IT, Chinese Version case study are - Strategic Management Strategies, Change management, IT, Leadership and Organizational Development.
Some of the macro environment factors that can be used to understand the Otis Elevator: Accelerating Business Transformation with IT, Chinese Version casestudy better are - – increasing energy prices, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels,
increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Otis Elevator: Accelerating Business Transformation with IT, Chinese Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Otis Elevator: Accelerating Business Transformation with IT, Chinese Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Transformation Otis, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Transformation Otis 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version can be done for the following purposes –
1. Strategic planning using facts provided in Otis Elevator: Accelerating Business Transformation with IT, Chinese Version case study
2. Improving business portfolio management of Transformation Otis
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 Transformation Otis
Strengths Otis Elevator: Accelerating Business Transformation with IT, Chinese Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Transformation Otis in Otis Elevator: Accelerating Business Transformation with IT, Chinese Version Harvard Business Review case study are -
Analytics focus
– Transformation Otis is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by F. Warren McFarlan, Brian J. Delacey can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Sustainable margins compare to other players in Organizational Development industry
– Otis Elevator: Accelerating Business Transformation with IT, Chinese Version firm has clearly differentiated products in the market place. This has enabled Transformation Otis to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Transformation Otis to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Transformation Otis in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Transformation Otis has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Transformation Otis 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.
Highly skilled collaborators
– Transformation Otis 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Transformation Otis 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.
Low bargaining power of suppliers
– Suppliers of Transformation Otis in the sector have low bargaining power. Otis Elevator: Accelerating Business Transformation with IT, Chinese Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Transformation Otis to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Transformation Otis is present in almost all the verticals within the industry. This has provided firm in Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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.
Effective Research and Development (R&D)
– Transformation Otis 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Transformation Otis is one of the most innovative firm in sector. Manager in Otis Elevator: Accelerating Business Transformation with IT, Chinese Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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.
High brand equity
– Transformation Otis has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Transformation Otis to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Otis Elevator: Accelerating Business Transformation with IT, Chinese Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Otis Elevator: Accelerating Business Transformation with IT, Chinese Version are -
Skills based hiring
– The stress on hiring functional specialists at Transformation Otis 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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 Transformation Otis has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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 Transformation Otis 's lucrative customers.
Products dominated business model
– Even though Transformation Otis has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Otis Elevator: Accelerating Business Transformation with IT, Chinese Version should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Transformation Otis, firm in the HBR case study Otis Elevator: Accelerating Business Transformation with IT, Chinese Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Transformation Otis 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Transformation Otis 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 to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Transformation Otis is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Otis Elevator: Accelerating Business Transformation with IT, Chinese Version can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
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 Transformation Otis supply chain. Even after few cautionary changes mentioned in the HBR case study - Otis Elevator: Accelerating Business Transformation with IT, Chinese Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Transformation Otis vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Transformation Otis 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Otis Elevator: Accelerating Business Transformation with IT, Chinese Version, in the dynamic environment Transformation Otis has struggled to respond to the nimble upstart competition. Transformation Otis has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Otis Elevator: Accelerating Business Transformation with IT, Chinese Version | 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Transformation Otis 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, Otis Elevator: Accelerating Business Transformation with IT, Chinese Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Transformation Otis 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 Transformation Otis has opened avenues for new revenue streams for the organization in the industry. This can help Transformation Otis to build a more holistic ecosystem as suggested in the Otis Elevator: Accelerating Business Transformation with IT, Chinese Version case study. Transformation Otis can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Transformation Otis 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.
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 Transformation Otis 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.
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. Transformation Otis can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Transformation Otis 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. Transformation Otis 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Transformation Otis 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 Transformation Otis to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Transformation Otis has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Otis Elevator: Accelerating Business Transformation with IT, Chinese Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Transformation Otis to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Transformation Otis 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.
Leveraging digital technologies
– Transformation Otis 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Transformation Otis is facing challenges because of the dominance of functional experts in the organization. Otis Elevator: Accelerating Business Transformation with IT, Chinese Version case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Building a culture of innovation
– managers at Transformation Otis 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 Organizational Development segment.
Threats Otis Elevator: Accelerating Business Transformation with IT, Chinese Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Otis Elevator: Accelerating Business Transformation with IT, Chinese Version are -
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. Transformation Otis needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
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 Transformation Otis business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Transformation Otis 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, Transformation Otis 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version .
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 Transformation Otis.
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 Transformation Otis in the Organizational Development sector and impact the bottomline of the organization.
Environmental challenges
– Transformation Otis 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. Transformation Otis can take advantage of this fund but it will also bring new competitors in the Organizational Development 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. Transformation Otis 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Transformation Otis 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Transformation Otis with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Transformation Otis 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Otis Elevator: Accelerating Business Transformation with IT, Chinese Version, Transformation Otis 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 .
Increasing wage structure of Transformation Otis
– 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 Transformation Otis.
Weighted SWOT Analysis of Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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 Otis Elevator: Accelerating Business Transformation with IT, Chinese Version 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 Transformation Otis needs to make to build a sustainable competitive advantage.