Ferio Pugliese: Leading WestJet's New Carrier Encore SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Ferio Pugliese: Leading WestJet's New Carrier Encore
In early 2014, Ferio Pugliese looked back on his turbulent first year as president of WestJet Airlines Ltd.'s new regional air service Encore. Encore represented the company's most significant organizational change in its 18 years of dramatic growth. Expanding the airline's fleet to include smaller, short-haul aircraft that could service smaller destinations throughout Western Canada had not been without growing pains. For example, a number of employees reportedly felt they were losing their sense of belonging in the company that prided itself on employee satisfaction. Pugliese wondered how he should proceed in putting Encore on a successful path.
Authors :: Gerard Seijts, Jean-Louis Schaan, Robert Way
Swot Analysis of "Ferio Pugliese: Leading WestJet's New Carrier Encore" written by Gerard Seijts, Jean-Louis Schaan, Robert Way includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Encore Pugliese facing as an external strategic factors. Some of the topics covered in Ferio Pugliese: Leading WestJet's New Carrier Encore case study are - Strategic Management Strategies, Leadership, Organizational culture, Strategy and Organizational Development.
Some of the macro environment factors that can be used to understand the Ferio Pugliese: Leading WestJet's New Carrier Encore casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, geopolitical disruptions, increasing government debt because of Covid-19 spendings, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing energy prices,
there is backlash against globalization, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Ferio Pugliese: Leading WestJet's New Carrier Encore
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ferio Pugliese: Leading WestJet's New Carrier Encore case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Encore Pugliese, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Encore Pugliese 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 Ferio Pugliese: Leading WestJet's New Carrier Encore can be done for the following purposes –
1. Strategic planning using facts provided in Ferio Pugliese: Leading WestJet's New Carrier Encore case study
2. Improving business portfolio management of Encore Pugliese
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 Encore Pugliese
Strengths Ferio Pugliese: Leading WestJet's New Carrier Encore | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Encore Pugliese in Ferio Pugliese: Leading WestJet's New Carrier Encore Harvard Business Review case study are -
High brand equity
– Encore Pugliese has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Encore Pugliese to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Encore Pugliese has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Ferio Pugliese: Leading WestJet's New Carrier Encore HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Encore Pugliese 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)
– Encore Pugliese 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 Ferio Pugliese: Leading WestJet's New Carrier Encore - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Encore Pugliese is one of the leading recruiters in the industry. Managers in the Ferio Pugliese: Leading WestJet's New Carrier Encore 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 Ferio Pugliese: Leading WestJet's New Carrier Encore 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.
Cross disciplinary teams
– Horizontal connected teams at the Encore Pugliese 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.
Organizational Resilience of Encore Pugliese
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Encore Pugliese 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
– Encore Pugliese has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Encore Pugliese 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.
Innovation driven organization
– Encore Pugliese is one of the most innovative firm in sector. Manager in Ferio Pugliese: Leading WestJet's New Carrier Encore Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Diverse revenue streams
– Encore Pugliese is present in almost all the verticals within the industry. This has provided firm in Ferio Pugliese: Leading WestJet's New Carrier Encore 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.
Training and development
– Encore Pugliese has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ferio Pugliese: Leading WestJet's New Carrier Encore 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.
Weaknesses Ferio Pugliese: Leading WestJet's New Carrier Encore | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ferio Pugliese: Leading WestJet's New Carrier Encore are -
Low market penetration in new markets
– Outside its home market of Encore Pugliese, firm in the HBR case study Ferio Pugliese: Leading WestJet's New Carrier Encore needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Encore Pugliese 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Gerard Seijts, Jean-Louis Schaan, Robert Way suggests that, Encore Pugliese is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Skills based hiring
– The stress on hiring functional specialists at Encore Pugliese 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Ferio Pugliese: Leading WestJet's New Carrier Encore 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 Encore Pugliese 's lucrative customers.
High cash cycle compare to competitors
Encore Pugliese has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow decision making process
– As mentioned earlier in the report, Encore Pugliese 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. Encore Pugliese 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Encore Pugliese 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Ferio Pugliese: Leading WestJet's New Carrier Encore, is just above the industry average. Encore Pugliese 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, Encore Pugliese 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.
Interest costs
– Compare to the competition, Encore Pugliese 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.
Opportunities Ferio Pugliese: Leading WestJet's New Carrier Encore | 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 Ferio Pugliese: Leading WestJet's New Carrier Encore are -
Using analytics as competitive advantage
– Encore Pugliese 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 Ferio Pugliese: Leading WestJet's New Carrier Encore - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Encore Pugliese to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Encore Pugliese has opened avenues for new revenue streams for the organization in the industry. This can help Encore Pugliese to build a more holistic ecosystem as suggested in the Ferio Pugliese: Leading WestJet's New Carrier Encore case study. Encore Pugliese can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Encore Pugliese can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Encore Pugliese in the consumer business. Now Encore Pugliese can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Encore Pugliese 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.
Better consumer reach
– The expansion of the 5G network will help Encore Pugliese to increase its market reach. Encore Pugliese 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 Encore Pugliese 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 Encore Pugliese to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Encore Pugliese to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
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. Encore Pugliese can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Encore Pugliese 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, Ferio Pugliese: Leading WestJet's New Carrier Encore, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Encore Pugliese 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.
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. Encore Pugliese can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Leveraging digital technologies
– Encore Pugliese 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.
Threats Ferio Pugliese: Leading WestJet's New Carrier Encore External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ferio Pugliese: Leading WestJet's New Carrier Encore are -
Regulatory challenges
– Encore Pugliese 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.
Shortening product life cycle
– it is one of the major threat that Encore Pugliese is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Encore Pugliese has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Encore Pugliese 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Encore Pugliese 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 Ferio Pugliese: Leading WestJet's New Carrier Encore .
Consumer confidence and its impact on Encore Pugliese 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.
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 Encore Pugliese in the Organizational Development sector and impact the bottomline of the organization.
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 Encore Pugliese 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.
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. Encore Pugliese can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Encore Pugliese business can come under increasing regulations regarding data privacy, data security, etc.
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. Encore Pugliese 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 level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Encore Pugliese needs to understand the core reasons impacting the Organizational Development industry. This will help it in building a better workplace.
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 Encore Pugliese.
Weighted SWOT Analysis of Ferio Pugliese: Leading WestJet's New Carrier Encore 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 Ferio Pugliese: Leading WestJet's New Carrier Encore 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 Ferio Pugliese: Leading WestJet's New Carrier Encore 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 Ferio Pugliese: Leading WestJet's New Carrier Encore 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 Ferio Pugliese: Leading WestJet's New Carrier Encore 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 Encore Pugliese needs to make to build a sustainable competitive advantage.