Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A)
In April 2013, Ford Asia Pacific & Africa (FAPA) was examining its options for e-coating service metal parts for the Ford Customer Service Division in Sanand, Gujarat, India. Randy Creel, Director of Parts Supply & Logistics, FAPA, worked with his colleagues in the US, UK, China, and India to conduct analysis and develop three options: outsourcing e-coating to a third party in Sanand, outsourcing e-coating to a third-party in Chennai and transporting the parts to Sanand, or building a stand-alone facility in Sanand. Factors like cost, quality, speed, and risk needed to be considered for this decision which had impact on profitability and customer satisfaction. Which option should FAPA choose?
Swot Analysis of "Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A)" written by Juan Alcacer, Nancy Hua Dai includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sanand Coating facing as an external strategic factors. Some of the topics covered in Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) case study are - Strategic Management Strategies, Strategy, Supply chain and Organizational Development.
Some of the macro environment factors that can be used to understand the Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, cloud computing is disrupting traditional business models,
there is backlash against globalization, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sanand Coating, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sanand Coating 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) can be done for the following purposes –
1. Strategic planning using facts provided in Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) case study
2. Improving business portfolio management of Sanand Coating
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 Sanand Coating
Strengths Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sanand Coating in Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) Harvard Business Review case study are -
Successful track record of launching new products
– Sanand Coating has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sanand Coating 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.
Training and development
– Sanand Coating has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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.
Strong track record of project management
– Sanand Coating is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Sanand Coating 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 Sanand Coating is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Low bargaining power of suppliers
– Suppliers of Sanand Coating in the sector have low bargaining power. Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sanand Coating to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Sanand Coating 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.
Diverse revenue streams
– Sanand Coating is present in almost all the verticals within the industry. This has provided firm in Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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.
Analytics focus
– Sanand Coating 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 Juan Alcacer, Nancy Hua Dai 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.
Effective Research and Development (R&D)
– Sanand Coating 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Sanand Coating digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sanand Coating 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 recruit top talent
– Sanand Coating is one of the leading recruiters in the industry. Managers in the Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Sanand Coating is one of the most innovative firm in sector. Manager in Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) are -
Skills based hiring
– The stress on hiring functional specialists at Sanand Coating 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 decision making process
– As mentioned earlier in the report, Sanand Coating 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. Sanand Coating 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.
Increasing silos among functional specialists
– The organizational structure of Sanand Coating is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Sanand Coating needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sanand Coating to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Sanand Coating has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Sanand Coating supply chain. Even after few cautionary changes mentioned in the HBR case study - Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Sanand Coating vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A), is just above the industry average. Sanand Coating needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Capital Spending Reduction
– Even during the low interest decade, Sanand Coating 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A), in the dynamic environment Sanand Coating has struggled to respond to the nimble upstart competition. Sanand Coating has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Sanand Coating products
– To increase the profitability and margins on the products, Sanand Coating 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, Sanand Coating 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.
Low market penetration in new markets
– Outside its home market of Sanand Coating, firm in the HBR case study Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) | 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sanand Coating can use these opportunities to build new business models that can help the communities that Sanand Coating operates in. Secondly it can use opportunities from government spending in Organizational Development sector.
Loyalty marketing
– Sanand Coating 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.
Using analytics as competitive advantage
– Sanand Coating 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Sanand Coating to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Sanand Coating to increase its market reach. Sanand Coating 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Sanand Coating 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 Sanand Coating to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sanand Coating 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.
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. Sanand Coating can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Sanand Coating 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.
Buying journey improvements
– Sanand Coating can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sanand Coating 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, Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Sanand Coating 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sanand Coating is facing challenges because of the dominance of functional experts in the organization. Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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.
Manufacturing automation
– Sanand Coating 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.
Threats Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) are -
Consumer confidence and its impact on Sanand Coating 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.
Increasing wage structure of Sanand Coating
– 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 Sanand Coating.
Stagnating economy with rate increase
– Sanand Coating 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.
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 Sanand Coating.
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.
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. Sanand Coating 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.
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 Sanand Coating in the Organizational Development sector and impact the bottomline of the organization.
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. Sanand Coating 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, Sanand Coating 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) .
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 Sanand Coating business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Sanand Coating 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. Sanand Coating can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
High dependence on third party suppliers
– Sanand Coating 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.
Weighted SWOT Analysis of Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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 Ford Asia Pacific & Africa: The E-coating Facility Decision in Gujarat, India (A) 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 Sanand Coating needs to make to build a sustainable competitive advantage.