Strategic IT Transformation at Accenture SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
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Case Study SWOT Analysis Solution
Case Study Description of Strategic IT Transformation at Accenture
In 2001 Accenture took the bold step of separating from its parent, Arthur Andersen. The new firm that emerged had a bright future ahead, but it also faced the challenge of building a new IT infrastructure that could support a global organization that consults on leading-edge technology. Accenture's CIO at the time, Ed Schreck, knew that becoming a master of your own trade was not an easy task. Frank Modruson, Schreck's successor and the person responsible for carrying forward the IT transformation challenge from 2002 on, had ambitious plans for the new technology infrastructure that was to replace Arthur Andersen's legacy systems. Difficult decisions had to be made. Should the firm continue with a decentralized approach to managing technology platforms, in which each country chooses its own IT platforms and has autonomy to run them? Or should the firm take a mixed approach, in which the same standard applications would run throughout the enterprise but would be managed independently by individual offices? Or should Accenture espouse a "one-firm" approach and boldly shoot for a centralized implementation of its most critical systems, with all its offices interconnected on the same "instance" of a software platform? Furthermore, should the firm retain its traditional conception of IT as cost center, or should it migrate to a scheme that recognizes IT as a service provision center that generates measurable value for the organization? These questions and many others drove Accenture's CIO team to undertake one of the most remarkable IT transformations in a global organization in recent years.
Authors :: Mark Jeffery, Daniel Fisher, Mirron Granot, Anuj Kadyan
Swot Analysis of "Strategic IT Transformation at Accenture" written by Mark Jeffery, Daniel Fisher, Mirron Granot, Anuj Kadyan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Accenture Accenture's facing as an external strategic factors. Some of the topics covered in Strategic IT Transformation at Accenture case study are - Strategic Management Strategies, Organizational culture and Organizational Development.
Some of the macro environment factors that can be used to understand the Strategic IT Transformation at Accenture casestudy better are - – wage bills are increasing, supply chains are disrupted by pandemic , increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies,
geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Strategic IT Transformation at Accenture
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Strategic IT Transformation at Accenture case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Accenture Accenture's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Accenture Accenture's 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 Strategic IT Transformation at Accenture can be done for the following purposes –
1. Strategic planning using facts provided in Strategic IT Transformation at Accenture case study
2. Improving business portfolio management of Accenture Accenture's
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 Accenture Accenture's
Strengths Strategic IT Transformation at Accenture | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Accenture Accenture's in Strategic IT Transformation at Accenture Harvard Business Review case study are -
Training and development
– Accenture Accenture's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Strategic IT Transformation at Accenture 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.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Accenture Accenture's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Accenture Accenture's 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.
Ability to lead change in Organizational Development field
– Accenture Accenture's 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 Accenture Accenture's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Accenture Accenture's 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.
Highly skilled collaborators
– Accenture Accenture's 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 Strategic IT Transformation at Accenture HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Accenture Accenture's 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 Strategic IT Transformation at Accenture - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Accenture Accenture's is one of the leading recruiters in the industry. Managers in the Strategic IT Transformation at Accenture are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Strategic IT Transformation at Accenture 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
– Accenture Accenture's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Accenture Accenture's 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.
Cross disciplinary teams
– Horizontal connected teams at the Accenture Accenture's 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.
Strong track record of project management
– Accenture Accenture's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Accenture Accenture's 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 Mark Jeffery, Daniel Fisher, Mirron Granot, Anuj Kadyan 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 Strategic IT Transformation at Accenture | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Strategic IT Transformation at Accenture are -
Lack of clear differentiation of Accenture Accenture's products
– To increase the profitability and margins on the products, Accenture Accenture's needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Accenture Accenture's is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Accenture Accenture's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Accenture Accenture's to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Strategic IT Transformation at Accenture, in the dynamic environment Accenture Accenture's has struggled to respond to the nimble upstart competition. Accenture Accenture's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Strategic IT Transformation at Accenture, is just above the industry average. Accenture Accenture's 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.
Aligning sales with marketing
– It come across in the case study Strategic IT Transformation at Accenture that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Strategic IT Transformation at Accenture can leverage the sales team experience to cultivate customer relationships as Accenture Accenture's is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the segment, Accenture Accenture's 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Strategic IT Transformation at Accenture, it seems that the employees of Accenture Accenture's 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Accenture Accenture's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Strategic IT Transformation at Accenture can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Accenture Accenture's 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.
High cash cycle compare to competitors
Accenture Accenture's 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.
Slow to strategic competitive environment developments
– As Strategic IT Transformation at Accenture HBR case study mentions - Accenture Accenture's 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.
Opportunities Strategic IT Transformation at Accenture | 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 Strategic IT Transformation at Accenture are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Accenture Accenture's is facing challenges because of the dominance of functional experts in the organization. Strategic IT Transformation at Accenture 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 Accenture Accenture's 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Accenture Accenture's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Accenture Accenture's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Accenture Accenture's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Strategic IT Transformation at Accenture 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Accenture Accenture's can use these opportunities to build new business models that can help the communities that Accenture Accenture's operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
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 Accenture Accenture's 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.
Using analytics as competitive advantage
– Accenture Accenture's 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 Strategic IT Transformation at Accenture - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Accenture Accenture's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Accenture Accenture's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Accenture Accenture's 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 Accenture Accenture's to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Accenture Accenture's 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.
Better consumer reach
– The expansion of the 5G network will help Accenture Accenture's to increase its market reach. Accenture Accenture's 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.
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 Accenture Accenture's in the consumer business. Now Accenture Accenture's can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Strategic IT Transformation at Accenture External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Strategic IT Transformation at Accenture are -
Increasing wage structure of Accenture Accenture's
– 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 Accenture Accenture's.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
High dependence on third party suppliers
– Accenture Accenture's 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.
Regulatory challenges
– Accenture Accenture's 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.
Consumer confidence and its impact on Accenture Accenture's 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.
Stagnating economy with rate increase
– Accenture Accenture's 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Accenture Accenture's 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Strategic IT Transformation at Accenture, Accenture Accenture's 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
– Accenture Accenture's has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Accenture Accenture's 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 Accenture Accenture's in the Organizational Development sector and impact the bottomline of the organization.
Environmental challenges
– Accenture Accenture's 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. Accenture Accenture's can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Shortening product life cycle
– it is one of the major threat that Accenture Accenture's is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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. Accenture Accenture's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Strategic IT Transformation at Accenture 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 Strategic IT Transformation at Accenture 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 Strategic IT Transformation at Accenture 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 Strategic IT Transformation at Accenture 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 Strategic IT Transformation at Accenture 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 Accenture Accenture's needs to make to build a sustainable competitive advantage.