Swot Analysis of "SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing" written by Sandra Vandermerwe, Marika Taishoff includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Upswing Skf facing as an external strategic factors. Some of the topics covered in SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing case study are - Strategic Management Strategies, Marketing, Reorganization and Organizational Development.
Some of the macro environment factors that can be used to understand the SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, there is backlash against globalization, supply chains are disrupted by pandemic , technology disruption,
central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Upswing Skf, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Upswing Skf 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing can be done for the following purposes –
1. Strategic planning using facts provided in SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing case study
2. Improving business portfolio management of Upswing Skf
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 Upswing Skf
Strengths SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Upswing Skf in SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing Harvard Business Review case study are -
Highly skilled collaborators
– Upswing Skf 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Organizational Development industry
– SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing firm has clearly differentiated products in the market place. This has enabled Upswing Skf to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Upswing Skf to invest into research and development (R&D) and innovation.
Analytics focus
– Upswing Skf 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 Sandra Vandermerwe, Marika Taishoff 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.
Cross disciplinary teams
– Horizontal connected teams at the Upswing Skf 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.
Operational resilience
– The operational resilience strategy in the SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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.
Strong track record of project management
– Upswing Skf 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 Upswing Skf in the sector have low bargaining power. SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Upswing Skf to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Organizational Development field
– Upswing Skf 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 Upswing Skf in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Upswing Skf digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Upswing Skf 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.
High brand equity
– Upswing Skf has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Upswing Skf to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Upswing Skf 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Upswing Skf 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 Upswing Skf is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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 Upswing Skf has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing, it seems that the employees of Upswing Skf 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, Upswing Skf 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing, is just above the industry average. Upswing Skf 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing, in the dynamic environment Upswing Skf has struggled to respond to the nimble upstart competition. Upswing Skf has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High cash cycle compare to competitors
Upswing Skf 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.
Low market penetration in new markets
– Outside its home market of Upswing Skf, firm in the HBR case study SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Aligning sales with marketing
– It come across in the case study SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing can leverage the sales team experience to cultivate customer relationships as Upswing Skf is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Upswing Skf is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Upswing Skf needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High operating costs
– Compare to the competitors, firm in the HBR case study SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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 Upswing Skf 's lucrative customers.
Opportunities SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing | 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Upswing Skf is facing challenges because of the dominance of functional experts in the organization. SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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.
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 Upswing Skf in the consumer business. Now Upswing Skf can target international markets with far fewer capital restrictions requirements than the existing system.
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. Upswing Skf can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Learning at scale
– Online learning technologies has now opened space for Upswing Skf 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, Upswing Skf 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.
Developing new processes and practices
– Upswing Skf 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.
Creating value in data economy
– The success of analytics program of Upswing Skf has opened avenues for new revenue streams for the organization in the industry. This can help Upswing Skf to build a more holistic ecosystem as suggested in the SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing case study. Upswing Skf can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Upswing Skf 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.
Better consumer reach
– The expansion of the 5G network will help Upswing Skf to increase its market reach. Upswing Skf 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.
Leveraging digital technologies
– Upswing Skf 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.
Using analytics as competitive advantage
– Upswing Skf 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Upswing Skf to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Upswing Skf can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Upswing Skf 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.
Threats SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Upswing Skf with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Upswing Skf 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing .
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.
Shortening product life cycle
– it is one of the major threat that Upswing Skf is facing in Organizational Development sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Upswing Skf 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. Upswing Skf can take advantage of this fund but it will also bring new competitors in the Organizational Development industry.
Regulatory challenges
– Upswing Skf 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.
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. Upswing Skf can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Upswing Skf.
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 Upswing Skf business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Upswing Skf has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Upswing Skf 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.
Consumer confidence and its impact on Upswing Skf 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.
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.
High dependence on third party suppliers
– Upswing Skf 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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 SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing 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 Upswing Skf needs to make to build a sustainable competitive advantage.
Feel free to connect with us if you need business research.
You can download Excel Template of Case Study Solution & Analysis of SKF Bearings Series: Market Orientation Through Services (C): Results and the Upswing