Swot Analysis of "Warner Cable (B)" written by Jeffrey A. Sonnenfeld, Maury Peiperl includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mckinnon Bruce facing as an external strategic factors. Some of the topics covered in Warner Cable (B) case study are - Strategic Management Strategies, Change management, Developing employees, Human resource management, Leadership and Organizational Development.
Some of the macro environment factors that can be used to understand the Warner Cable (B) casestudy better are - – cloud computing is disrupting traditional business models, central banks are concerned over increasing inflation, wage bills are increasing, increasing government debt because of Covid-19 spendings, geopolitical disruptions, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China,
increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Warner Cable (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mckinnon Bruce, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mckinnon Bruce 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 Warner Cable (B) can be done for the following purposes –
1. Strategic planning using facts provided in Warner Cable (B) case study
2. Improving business portfolio management of Mckinnon Bruce
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 Mckinnon Bruce
Strengths Warner Cable (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mckinnon Bruce in Warner Cable (B) Harvard Business Review case study are -
Training and development
– Mckinnon Bruce has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Warner Cable (B) 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.
Sustainable margins compare to other players in Organizational Development industry
– Warner Cable (B) firm has clearly differentiated products in the market place. This has enabled Mckinnon Bruce to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Mckinnon Bruce to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Mckinnon Bruce 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.
Learning organization
- Mckinnon Bruce 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 Mckinnon Bruce is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Warner Cable (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Mckinnon Bruce has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Mckinnon Bruce 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.
Superior customer experience
– The customer experience strategy of Mckinnon Bruce in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Mckinnon Bruce is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Mckinnon Bruce in the sector have low bargaining power. Warner Cable (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mckinnon Bruce to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Warner Cable (B) 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.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Mckinnon Bruce digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mckinnon Bruce 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.
Innovation driven organization
– Mckinnon Bruce is one of the most innovative firm in sector. Manager in Warner Cable (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Mckinnon Bruce 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 Jeffrey A. Sonnenfeld, Maury Peiperl 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.
Weaknesses Warner Cable (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Warner Cable (B) are -
Increasing silos among functional specialists
– The organizational structure of Mckinnon Bruce is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Mckinnon Bruce needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Mckinnon Bruce to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As Warner Cable (B) HBR case study mentions - Mckinnon Bruce 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mckinnon Bruce is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Warner Cable (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Mckinnon Bruce products
– To increase the profitability and margins on the products, Mckinnon Bruce needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Mckinnon Bruce 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. Mckinnon Bruce 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
Mckinnon Bruce 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Warner Cable (B) 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 Mckinnon Bruce 's lucrative customers.
Interest costs
– Compare to the competition, Mckinnon Bruce 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.
Low market penetration in new markets
– Outside its home market of Mckinnon Bruce, firm in the HBR case study Warner Cable (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Warner Cable (B), is just above the industry average. Mckinnon Bruce 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.
Capital Spending Reduction
– Even during the low interest decade, Mckinnon Bruce 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 industry using digital technology.
Opportunities Warner Cable (B) | 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 Warner Cable (B) are -
Using analytics as competitive advantage
– Mckinnon Bruce 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 Warner Cable (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mckinnon Bruce to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mckinnon Bruce can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Mckinnon Bruce can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mckinnon Bruce 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Mckinnon Bruce 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 Mckinnon Bruce to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mckinnon Bruce can use these opportunities to build new business models that can help the communities that Mckinnon Bruce operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Better consumer reach
– The expansion of the 5G network will help Mckinnon Bruce to increase its market reach. Mckinnon Bruce will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
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. Mckinnon Bruce 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. Mckinnon Bruce 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.
Buying journey improvements
– Mckinnon Bruce can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Warner Cable (B) 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.
Developing new processes and practices
– Mckinnon Bruce can develop new processes and procedures in Organizational Development 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mckinnon Bruce 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.
Loyalty marketing
– Mckinnon Bruce 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.
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 Mckinnon Bruce 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.
Threats Warner Cable (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Warner Cable (B) are -
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mckinnon Bruce 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 Warner Cable (B) .
Environmental challenges
– Mckinnon Bruce 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. Mckinnon Bruce can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Warner Cable (B), Mckinnon Bruce 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 .
Regulatory challenges
– Mckinnon Bruce 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.
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 Mckinnon Bruce.
Increasing wage structure of Mckinnon Bruce
– 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 Mckinnon Bruce.
Consumer confidence and its impact on Mckinnon Bruce 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.
High dependence on third party suppliers
– Mckinnon Bruce 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.
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. Mckinnon Bruce 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.
Stagnating economy with rate increase
– Mckinnon Bruce 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Mckinnon Bruce with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Mckinnon Bruce has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Mckinnon Bruce 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.
Weighted SWOT Analysis of Warner Cable (B) 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 Warner Cable (B) 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 Warner Cable (B) 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 Warner Cable (B) 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 Warner Cable (B) 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 Mckinnon Bruce needs to make to build a sustainable competitive advantage.
