Case Study Description of Norwood WaterWorks, EMCO Corporation: Changing the Culture
In September 2006, the general manager at Norwood Waterworks (Norwood) was faced with a difficult situation. Since his original employer, EMCO Corporation (Emco), acquired Norwood, he had been tasked with trying to turn around the new acquisition. Like Emco, Norwood was a distributor of building products and equipment in the waterworks industry. The company had three locations, all in Alberta. However, the general manager soon discovered that Norwood was suffering due to a poor organizational culture. Employees were unmotivated, overpaid, and complacent. He needed to communicate-clearly and effectively-that the Emco culture was here to stay, and that the Norwood employees needed to find a way to change the way they operated.
Swot Analysis of "Norwood WaterWorks, EMCO Corporation: Changing the Culture" written by Ann Peng, Ken Mark includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Norwood Emco facing as an external strategic factors. Some of the topics covered in Norwood WaterWorks, EMCO Corporation: Changing the Culture case study are - Strategic Management Strategies, Organizational culture and Organizational Development.
Some of the macro environment factors that can be used to understand the Norwood WaterWorks, EMCO Corporation: Changing the Culture casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, increasing energy prices, there is backlash against globalization, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, central banks are concerned over increasing inflation,
wage bills are increasing, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Norwood WaterWorks, EMCO Corporation: Changing the Culture
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Norwood WaterWorks, EMCO Corporation: Changing the Culture case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Norwood Emco, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Norwood Emco 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture can be done for the following purposes –
1. Strategic planning using facts provided in Norwood WaterWorks, EMCO Corporation: Changing the Culture case study
2. Improving business portfolio management of Norwood Emco
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 Norwood Emco
Strengths Norwood WaterWorks, EMCO Corporation: Changing the Culture | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Norwood Emco in Norwood WaterWorks, EMCO Corporation: Changing the Culture Harvard Business Review case study are -
Sustainable margins compare to other players in Organizational Development industry
– Norwood WaterWorks, EMCO Corporation: Changing the Culture firm has clearly differentiated products in the market place. This has enabled Norwood Emco to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Norwood Emco to invest into research and development (R&D) and innovation.
Strong track record of project management
– Norwood Emco 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
– Norwood Emco 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 Ann Peng, Ken Mark 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.
High switching costs
– The high switching costs that Norwood Emco 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.
Ability to lead change in Organizational Development field
– Norwood Emco 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 Norwood Emco in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Norwood Emco in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Norwood Emco is present in almost all the verticals within the industry. This has provided firm in Norwood WaterWorks, EMCO Corporation: Changing the Culture 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.
Ability to recruit top talent
– Norwood Emco is one of the leading recruiters in the industry. Managers in the Norwood WaterWorks, EMCO Corporation: Changing the Culture 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture 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.
Learning organization
- Norwood Emco 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 Norwood Emco is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Norwood WaterWorks, EMCO Corporation: Changing the Culture Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Norwood Emco in the sector have low bargaining power. Norwood WaterWorks, EMCO Corporation: Changing the Culture has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Norwood Emco to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Norwood Emco has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Norwood Emco to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Norwood WaterWorks, EMCO Corporation: Changing the Culture | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Norwood WaterWorks, EMCO Corporation: Changing the Culture are -
High operating costs
– Compare to the competitors, firm in the HBR case study Norwood WaterWorks, EMCO Corporation: Changing the Culture 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 Norwood Emco 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Norwood Emco 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Norwood WaterWorks, EMCO Corporation: Changing the Culture 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 Norwood Emco has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Norwood Emco 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Norwood WaterWorks, EMCO Corporation: Changing the Culture, in the dynamic environment Norwood Emco has struggled to respond to the nimble upstart competition. Norwood Emco has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Norwood Emco 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.
Products dominated business model
– Even though Norwood Emco 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 - Norwood WaterWorks, EMCO Corporation: Changing the Culture should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Norwood Emco products
– To increase the profitability and margins on the products, Norwood Emco needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Norwood Emco is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Norwood Emco needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Norwood Emco to focus more on services rather than just following the product oriented approach.
Skills based hiring
– The stress on hiring functional specialists at Norwood Emco 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Norwood Emco is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Norwood WaterWorks, EMCO Corporation: Changing the Culture can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Norwood WaterWorks, EMCO Corporation: Changing the Culture | 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture are -
Loyalty marketing
– Norwood Emco 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 Norwood Emco 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Norwood Emco is facing challenges because of the dominance of functional experts in the organization. Norwood WaterWorks, EMCO Corporation: Changing the Culture 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Norwood Emco in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Organizational Development segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Norwood Emco 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 Norwood Emco to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Norwood Emco 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.
Creating value in data economy
– The success of analytics program of Norwood Emco has opened avenues for new revenue streams for the organization in the industry. This can help Norwood Emco to build a more holistic ecosystem as suggested in the Norwood WaterWorks, EMCO Corporation: Changing the Culture case study. Norwood Emco can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Norwood Emco 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Norwood Emco to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Building a culture of innovation
– managers at Norwood Emco 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.
Manufacturing automation
– Norwood Emco 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.
Developing new processes and practices
– Norwood Emco 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Norwood Emco 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.
Buying journey improvements
– Norwood Emco can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Norwood WaterWorks, EMCO Corporation: Changing the Culture 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.
Threats Norwood WaterWorks, EMCO Corporation: Changing the Culture External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Norwood WaterWorks, EMCO Corporation: Changing the Culture are -
Environmental challenges
– Norwood Emco 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. Norwood Emco can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Technology acceleration in Forth Industrial Revolution
– Norwood Emco has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Norwood Emco 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.
Increasing wage structure of Norwood Emco
– 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 Norwood Emco.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Norwood Emco 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.
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 Norwood Emco.
High dependence on third party suppliers
– Norwood Emco 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.
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.
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 Norwood Emco in the Organizational Development sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Norwood Emco with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Norwood Emco 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture .
Stagnating economy with rate increase
– Norwood Emco 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.
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 Norwood Emco business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Norwood WaterWorks, EMCO Corporation: Changing the Culture 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture 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 Norwood WaterWorks, EMCO Corporation: Changing the Culture 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 Norwood Emco needs to make to build a sustainable competitive advantage.
