Sterling Chemicals, Inc.: Quality and Productivity Improvement Program SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Sterling Chemicals, Inc.: Quality and Productivity Improvement Program
Describes the design and implemenation of a quality improvement program. Sterling Chemical's management hoped the program would improve teamwork and productivity at the plant.
Swot Analysis of "Sterling Chemicals, Inc.: Quality and Productivity Improvement Program" written by Karen H. Wruck, A. Scott Keating includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sterling Implemenation facing as an external strategic factors. Some of the topics covered in Sterling Chemicals, Inc.: Quality and Productivity Improvement Program case study are - Strategic Management Strategies, Motivating people, Organizational culture, Product development and Organizational Development.
Some of the macro environment factors that can be used to understand the Sterling Chemicals, Inc.: Quality and Productivity Improvement Program casestudy better are - – increasing commodity prices, increasing energy prices, increasing transportation and logistics costs, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs,
banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Sterling Chemicals, Inc.: Quality and Productivity Improvement Program
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Sterling Chemicals, Inc.: Quality and Productivity Improvement Program case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sterling Implemenation, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sterling Implemenation 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program can be done for the following purposes –
1. Strategic planning using facts provided in Sterling Chemicals, Inc.: Quality and Productivity Improvement Program case study
2. Improving business portfolio management of Sterling Implemenation
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 Sterling Implemenation
Strengths Sterling Chemicals, Inc.: Quality and Productivity Improvement Program | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sterling Implemenation in Sterling Chemicals, Inc.: Quality and Productivity Improvement Program Harvard Business Review case study are -
High brand equity
– Sterling Implemenation has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sterling Implemenation to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Sterling Implemenation is one of the leading recruiters in the industry. Managers in the Sterling Chemicals, Inc.: Quality and Productivity Improvement Program are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Organizational Development field
– Sterling Implemenation 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 Sterling Implemenation in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Sterling Implemenation has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sterling Implemenation 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.
Effective Research and Development (R&D)
– Sterling Implemenation 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Sterling Implemenation 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
– Sterling Implemenation 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 Sterling Implemenation in the sector have low bargaining power. Sterling Chemicals, Inc.: Quality and Productivity Improvement Program has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sterling Implemenation to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Sterling Implemenation is present in almost all the verticals within the industry. This has provided firm in Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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.
Organizational Resilience of Sterling Implemenation
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Sterling Implemenation does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Organizational Development industry
– Sterling Chemicals, Inc.: Quality and Productivity Improvement Program firm has clearly differentiated products in the market place. This has enabled Sterling Implemenation to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Sterling Implemenation to invest into research and development (R&D) and innovation.
Innovation driven organization
– Sterling Implemenation is one of the most innovative firm in sector. Manager in Sterling Chemicals, Inc.: Quality and Productivity Improvement Program Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Sterling Chemicals, Inc.: Quality and Productivity Improvement Program | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sterling Chemicals, Inc.: Quality and Productivity Improvement Program are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Sterling Chemicals, Inc.: Quality and Productivity Improvement Program, is just above the industry average. Sterling Implemenation 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.
Lack of clear differentiation of Sterling Implemenation products
– To increase the profitability and margins on the products, Sterling Implemenation 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, Sterling Implemenation 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. Sterling Implemenation 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
Sterling Implemenation 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.
No frontier risks strategy
– After analyzing the HBR case study Sterling Chemicals, Inc.: Quality and Productivity Improvement Program, 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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 Sterling Implemenation has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Sterling Implemenation 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Sterling Chemicals, Inc.: Quality and Productivity Improvement Program, it seems that the employees of Sterling Implemenation 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.
Capital Spending Reduction
– Even during the low interest decade, Sterling Implemenation 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.
Skills based hiring
– The stress on hiring functional specialists at Sterling Implemenation 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 strategic competitive environment developments
– As Sterling Chemicals, Inc.: Quality and Productivity Improvement Program HBR case study mentions - Sterling Implemenation 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program | 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program are -
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 Sterling Implemenation 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sterling Implemenation 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, Sterling Chemicals, Inc.: Quality and Productivity Improvement Program, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sterling Implemenation can use these opportunities to build new business models that can help the communities that Sterling Implemenation operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Using analytics as competitive advantage
– Sterling Implemenation 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sterling Implemenation to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Sterling Implemenation in the consumer business. Now Sterling Implemenation can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Sterling Implemenation 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. Sterling Implemenation can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sterling Implemenation 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.
Leveraging digital technologies
– Sterling Implemenation 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.
Developing new processes and practices
– Sterling Implemenation 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.
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. Sterling Implemenation 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
– Sterling Implemenation can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sterling Implemenation is facing challenges because of the dominance of functional experts in the organization. Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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.
Threats Sterling Chemicals, Inc.: Quality and Productivity Improvement Program External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Sterling Chemicals, Inc.: Quality and Productivity Improvement Program are -
Technology acceleration in Forth Industrial Revolution
– Sterling Implemenation has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Sterling Implemenation 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sterling Implemenation with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Sterling Implemenation business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Sterling Implemenation 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. Sterling Implemenation can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Sterling Implemenation 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.
High dependence on third party suppliers
– Sterling Implemenation 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sterling Implemenation 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sterling Implemenation 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program .
Shortening product life cycle
– it is one of the major threat that Sterling Implemenation is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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 Sterling Implemenation.
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.
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. Sterling Implemenation 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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 Sterling Chemicals, Inc.: Quality and Productivity Improvement Program 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 Sterling Implemenation needs to make to build a sustainable competitive advantage.