Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
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Case Study Description of Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change
This article explores what it is that managers actually do to successfully lead IT-enabled change. It is based on a three-year case study of the practice of leading IT-enabled change inside the global telecommunications company Ericsson. This organization managed to successfully change their finance and accounting department from an independent structure of numerous local finance and accounting organizations with their own information systems and their own way of doing things into one interdependent global network of shared service centers enabled by a single information system. Based on this and other studies, this article develops a commonality framework for IT-enabled change, which offers important guidelines to improve managerial practice.
Swot Analysis of "Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change" written by Einar Iveroth includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Enabled Ericsson facing as an external strategic factors. Some of the topics covered in Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change case study are - Strategic Management Strategies, IT, Organizational structure and Organizational Development.
Some of the macro environment factors that can be used to understand the Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change casestudy better are - – cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, increasing transportation and logistics costs, talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, geopolitical disruptions,
supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Enabled Ericsson, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Enabled Ericsson 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change can be done for the following purposes –
1. Strategic planning using facts provided in Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change case study
2. Improving business portfolio management of Enabled Ericsson
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 Enabled Ericsson
Strengths Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Enabled Ericsson in Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change Harvard Business Review case study are -
Diverse revenue streams
– Enabled Ericsson is present in almost all the verticals within the industry. This has provided firm in Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change 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.
Cross disciplinary teams
– Horizontal connected teams at the Enabled Ericsson 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.
Ability to lead change in Organizational Development field
– Enabled Ericsson 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 Enabled Ericsson 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 Enabled Ericsson 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.
High brand equity
– Enabled Ericsson has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Enabled Ericsson to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Enabled Ericsson has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change 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.
Analytics focus
– Enabled Ericsson 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 Einar Iveroth 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.
Superior customer experience
– The customer experience strategy of Enabled Ericsson in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Enabled Ericsson 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Enabled Ericsson
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Enabled Ericsson does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Enabled Ericsson has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Enabled Ericsson 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.
Sustainable margins compare to other players in Organizational Development industry
– Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change firm has clearly differentiated products in the market place. This has enabled Enabled Ericsson to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Enabled Ericsson to invest into research and development (R&D) and innovation.
Weaknesses Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change are -
High operating costs
– Compare to the competitors, firm in the HBR case study Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change 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 Enabled Ericsson 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Enabled Ericsson is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Increasing silos among functional specialists
– The organizational structure of Enabled Ericsson is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Enabled Ericsson needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Enabled Ericsson to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change, it seems that company is thinking about the frontier risks that can impact Organizational Development strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Need for greater diversity
– Enabled Ericsson 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.
Slow to strategic competitive environment developments
– As Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change HBR case study mentions - Enabled Ericsson 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 decision making process
– As mentioned earlier in the report, Enabled Ericsson 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. Enabled Ericsson 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.
Lack of clear differentiation of Enabled Ericsson products
– To increase the profitability and margins on the products, Enabled Ericsson needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the segment, Enabled Ericsson 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.
Interest costs
– Compare to the competition, Enabled Ericsson 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
Enabled Ericsson 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.
Opportunities Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change | 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change are -
Developing new processes and practices
– Enabled Ericsson 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.
Building a culture of innovation
– managers at Enabled Ericsson 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.
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. Enabled Ericsson can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Enabled Ericsson 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. Enabled Ericsson can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Enabled Ericsson 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 Enabled Ericsson to hire the very best people irrespective of their geographical location.
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. Enabled Ericsson 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. Enabled Ericsson 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.
Leveraging digital technologies
– Enabled Ericsson 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.
Using analytics as competitive advantage
– Enabled Ericsson 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Enabled Ericsson to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Enabled Ericsson 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, Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Enabled Ericsson has opened avenues for new revenue streams for the organization in the industry. This can help Enabled Ericsson to build a more holistic ecosystem as suggested in the Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change case study. Enabled Ericsson can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Enabled Ericsson to increase its market reach. Enabled Ericsson 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.
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 Enabled Ericsson 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change are -
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. Enabled Ericsson can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Enabled Ericsson 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change .
Consumer confidence and its impact on Enabled Ericsson 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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Enabled Ericsson 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.
High dependence on third party suppliers
– Enabled Ericsson 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Enabled Ericsson with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Enabled Ericsson
– 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 Enabled Ericsson.
Shortening product life cycle
– it is one of the major threat that Enabled Ericsson is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Enabled Ericsson 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.
Environmental challenges
– Enabled Ericsson 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. Enabled Ericsson can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
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.
Stagnating economy with rate increase
– Enabled Ericsson can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Weighted SWOT Analysis of Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change 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 Inside Ericsson: A Framework for the Practice of Leading Global IT-Enabled Change 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 Enabled Ericsson needs to make to build a sustainable competitive advantage.
