"Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version

This three-part case-study illustrates key concepts and lessons about leading adaptive change in organizations in the context of turning around Deutsche Telekom, one of the world's largest telecommunication companies. The case portrays some of the efforts undertaken by Deutsche Telekom under the leadership of RenA? Obermann after his ascent to the CEO position in that organization. The case illustrates the challenges associated with resistance to adaptive change, management of expectations of organizational members from their leaders, and the psychological challenges of leading necessary, but unpopular, change efforts under the conditions of pressure from organizational stakeholders, who consciously or unconsciously attempt to divert the change-oriented leader from pushing the organization forward. The A case briefly describes Deutsche Telekom's background of a former state-owned monopolist and its struggles in a current competitive environment, provides information about RenA? Obermann and his ascent to the CEO position, and outlines some of the change initiatives undertaken by the organization. It culminates in a letter sent to RenA? Obermann and Board members of Deutsche Telekom by a company's technician in Berlin. In the letter, which later became associated with the feelings of many of Deutsche Telekom's employees, the author accuses the Board of the company in having no interest in the development of the company, well-being of employees, and service to the customers. The B case shows the reaction to the letter (which quickly leaked to the media) within Deutsche Telekom and in German society, and provides an account of an emotional response from RenA? Obermann, who chose to respond publicly to the letter. The C case provides an overview of the change actions undertaken at Deutsche Telekom under the leadership of RenA? Obermann and describes the outcomes known at the time of preparing this case study.

Authors :: Konstantin Korotov, Urs Mueller, Ulf Schaefer

Topics :: Organizational Development

Tags :: Human resource management, Leadership, Organizational culture, Public relations, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of ""Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version" written by Konstantin Korotov, Urs Mueller, Ulf Schaefer includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Deutsche Telekom facing as an external strategic factors. Some of the topics covered in "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version case study are - Strategic Management Strategies, Human resource management, Leadership, Organizational culture, Public relations and Organizational Development.

Some of the macro environment factors that can be used to understand the "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version casestudy better are - – wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, there is backlash against globalization, increasing energy prices, challanges to central banks by blockchain based private currencies, increasing commodity prices, etc

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Introduction to SWOT Analysis of "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Deutsche Telekom, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Deutsche Telekom 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version case study
2. Improving business portfolio management of Deutsche Telekom
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 Deutsche Telekom

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Strengths "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Deutsche Telekom in "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version Harvard Business Review case study are -

Analytics focus

– Deutsche Telekom 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 Konstantin Korotov, Urs Mueller, Ulf Schaefer 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 Deutsche Telekom 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.

Strong track record of project management

– Deutsche Telekom is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Sustainable margins compare to other players in Organizational Development industry

– "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version firm has clearly differentiated products in the market place. This has enabled Deutsche Telekom to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Deutsche Telekom to invest into research and development (R&D) and innovation.

Superior customer experience

– The customer experience strategy of Deutsche Telekom in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Cross disciplinary teams

– Horizontal connected teams at the Deutsche Telekom 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.

Training and development

– Deutsche Telekom has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version 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.

Organizational Resilience of Deutsche Telekom

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Deutsche Telekom does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Low bargaining power of suppliers

– Suppliers of Deutsche Telekom in the sector have low bargaining power. "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Deutsche Telekom to manage not only supply disruptions but also source products at highly competitive prices.

Digital Transformation in Organizational Development segment

- digital transformation varies from industry to industry. For Deutsche Telekom digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Deutsche Telekom 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.

Successful track record of launching new products

– Deutsche Telekom has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Deutsche Telekom 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.

High brand equity

– Deutsche Telekom has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Deutsche Telekom to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

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Weaknesses "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version are -

No frontier risks strategy

– After analyzing the HBR case study "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version, 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.

Aligning sales with marketing

– It come across in the case study "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version can leverage the sales team experience to cultivate customer relationships as Deutsche Telekom is planning to shift buying processes online.

High bargaining power of channel partners

– Because of the regulatory requirements, Konstantin Korotov, Urs Mueller, Ulf Schaefer suggests that, Deutsche Telekom 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.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Deutsche Telekom is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

Slow to strategic competitive environment developments

– As "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version HBR case study mentions - Deutsche Telekom 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.

Lack of clear differentiation of Deutsche Telekom products

– To increase the profitability and margins on the products, Deutsche Telekom needs to provide more differentiated products than what it is currently offering in the marketplace.

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 Deutsche Telekom supply chain. Even after few cautionary changes mentioned in the HBR case study - "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Deutsche Telekom vulnerable to further global disruptions in South East Asia.

High cash cycle compare to competitors

Deutsche Telekom 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.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version, in the dynamic environment Deutsche Telekom has struggled to respond to the nimble upstart competition. Deutsche Telekom has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Low market penetration in new markets

– Outside its home market of Deutsche Telekom, firm in the HBR case study "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version, it seems that the employees of Deutsche Telekom 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.

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Opportunities "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version | 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 "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version are -

Redefining models of collaboration and team work

– As explained in the weaknesses section, Deutsche Telekom is facing challenges because of the dominance of functional experts in the organization. "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version 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.

Better consumer reach

– The expansion of the 5G network will help Deutsche Telekom to increase its market reach. Deutsche Telekom 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.

Loyalty marketing

– Deutsche Telekom 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Deutsche Telekom can use these opportunities to build new business models that can help the communities that Deutsche Telekom operates in. Secondly it can use opportunities from government spending in Organizational Development sector.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Deutsche Telekom 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, "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Using analytics as competitive advantage

– Deutsche Telekom 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 "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Deutsche Telekom to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

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. Deutsche Telekom can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Manufacturing automation

– Deutsche Telekom 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.

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 Deutsche Telekom 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.

Creating value in data economy

– The success of analytics program of Deutsche Telekom has opened avenues for new revenue streams for the organization in the industry. This can help Deutsche Telekom to build a more holistic ecosystem as suggested in the "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version case study. Deutsche Telekom can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Changes in consumer behavior post Covid-19

– Consumer behavior has changed in the Organizational Development industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Deutsche Telekom can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Deutsche Telekom can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.

Learning at scale

– Online learning technologies has now opened space for Deutsche Telekom 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.

Low interest rates

– Even though inflation is raising its head in most developed economies, Deutsche Telekom 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.

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Threats "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version are -

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version, Deutsche Telekom may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Organizational Development .

Environmental challenges

– Deutsche Telekom 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. Deutsche Telekom can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.

Stagnating economy with rate increase

– Deutsche Telekom 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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Deutsche Telekom 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 "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version .

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 Deutsche Telekom business can come under increasing regulations regarding data privacy, data security, etc.

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 Deutsche Telekom in the Organizational Development sector and impact the bottomline of the organization.

Regulatory challenges

– Deutsche Telekom 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.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Deutsche Telekom 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.

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.

Consumer confidence and its impact on Deutsche Telekom 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.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Deutsche Telekom with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

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. Deutsche Telekom 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

– Deutsche Telekom 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.

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Weighted SWOT Analysis of "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version 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 "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version 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 "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version 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 "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version 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 "Do you really think we are so stupid?" A letter to the CEO of Deutsche Telekom (A), Spanish Version 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 Deutsche Telekom needs to make to build a sustainable competitive advantage.

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