Parsons Brinckerhoff: The Second Avenue Subway (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Parsons Brinckerhoff: The Second Avenue Subway (A)
Can a company base a major proposal on its good reputation, history with the client, and a perspective that differs from the client's own? Emphasizing both its engineering capability and 80 years' experience, Parsons Brinckerhoff spends one year and $1 million preparing a proposal to build a $17 billion subway line. Competition from four equally qualified firms is stiff, but PB is sure its history and top-level MTA connections make it a shoe-in. Despite MTA's concerns about the finished line's functionality, PB believes the construction of the tunnel itself is the key to winning the bid. In the A case, the firm awaits the good news. The B and C cases reveal the results and the direction the company then chooses to take. (A teaching note is available to registered faculty members.)
Swot Analysis of "Parsons Brinckerhoff: The Second Avenue Subway (A)" written by Ronald T Wilcox, Carlos Michael Santos includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Brinckerhoff Pb facing as an external strategic factors. Some of the topics covered in Parsons Brinckerhoff: The Second Avenue Subway (A) case study are - Strategic Management Strategies, Strategy and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Parsons Brinckerhoff: The Second Avenue Subway (A) casestudy better are - – geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, wage bills are increasing, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs,
competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, etc
Introduction to SWOT Analysis of Parsons Brinckerhoff: The Second Avenue Subway (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Parsons Brinckerhoff: The Second Avenue Subway (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Brinckerhoff Pb, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Brinckerhoff Pb 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 Parsons Brinckerhoff: The Second Avenue Subway (A) can be done for the following purposes –
1. Strategic planning using facts provided in Parsons Brinckerhoff: The Second Avenue Subway (A) case study
2. Improving business portfolio management of Brinckerhoff Pb
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Brinckerhoff Pb
Strengths Parsons Brinckerhoff: The Second Avenue Subway (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Brinckerhoff Pb in Parsons Brinckerhoff: The Second Avenue Subway (A) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Brinckerhoff Pb in the sector have low bargaining power. Parsons Brinckerhoff: The Second Avenue Subway (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Brinckerhoff Pb to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Brinckerhoff Pb 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 Ronald T Wilcox, Carlos Michael Santos 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.
Superior customer experience
– The customer experience strategy of Brinckerhoff Pb in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Brinckerhoff Pb has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Parsons Brinckerhoff: The Second Avenue Subway (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.
Innovation driven organization
– Brinckerhoff Pb is one of the most innovative firm in sector. Manager in Parsons Brinckerhoff: The Second Avenue Subway (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Brinckerhoff Pb 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 Brinckerhoff Pb is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Parsons Brinckerhoff: The Second Avenue Subway (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Parsons Brinckerhoff: The Second Avenue Subway (A) 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.
Successful track record of launching new products
– Brinckerhoff Pb has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Brinckerhoff Pb has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Effective Research and Development (R&D)
– Brinckerhoff Pb 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 Parsons Brinckerhoff: The Second Avenue Subway (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.
Strong track record of project management
– Brinckerhoff Pb is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Brinckerhoff Pb
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Brinckerhoff Pb does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Brinckerhoff Pb 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.
Weaknesses Parsons Brinckerhoff: The Second Avenue Subway (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Parsons Brinckerhoff: The Second Avenue Subway (A) are -
Skills based hiring
– The stress on hiring functional specialists at Brinckerhoff Pb 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Parsons Brinckerhoff: The Second Avenue Subway (A), is just above the industry average. Brinckerhoff Pb 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.
Aligning sales with marketing
– It come across in the case study Parsons Brinckerhoff: The Second Avenue Subway (A) 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 Parsons Brinckerhoff: The Second Avenue Subway (A) can leverage the sales team experience to cultivate customer relationships as Brinckerhoff Pb is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Brinckerhoff Pb 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. Brinckerhoff Pb even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High 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 Brinckerhoff Pb supply chain. Even after few cautionary changes mentioned in the HBR case study - Parsons Brinckerhoff: The Second Avenue Subway (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Brinckerhoff Pb vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Brinckerhoff Pb 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Parsons Brinckerhoff: The Second Avenue Subway (A) 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 Brinckerhoff Pb has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Brinckerhoff Pb 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.
Low market penetration in new markets
– Outside its home market of Brinckerhoff Pb, firm in the HBR case study Parsons Brinckerhoff: The Second Avenue Subway (A) 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 Parsons Brinckerhoff: The Second Avenue Subway (A), it seems that the employees of Brinckerhoff Pb 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.
No frontier risks strategy
– After analyzing the HBR case study Parsons Brinckerhoff: The Second Avenue Subway (A), it seems that company is thinking about the frontier risks that can impact Sales & Marketing 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.
Opportunities Parsons Brinckerhoff: The Second Avenue Subway (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 Parsons Brinckerhoff: The Second Avenue Subway (A) are -
Building a culture of innovation
– managers at Brinckerhoff Pb 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 Sales & Marketing segment.
Leveraging digital technologies
– Brinckerhoff Pb 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Brinckerhoff Pb 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.
Creating value in data economy
– The success of analytics program of Brinckerhoff Pb has opened avenues for new revenue streams for the organization in the industry. This can help Brinckerhoff Pb to build a more holistic ecosystem as suggested in the Parsons Brinckerhoff: The Second Avenue Subway (A) case study. Brinckerhoff Pb can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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, Brinckerhoff Pb can use these opportunities to build new business models that can help the communities that Brinckerhoff Pb operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Brinckerhoff Pb 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 Brinckerhoff Pb to hire the very best people irrespective of their geographical location.
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 Brinckerhoff Pb in the consumer business. Now Brinckerhoff Pb can target international markets with far fewer capital restrictions requirements than the existing system.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Brinckerhoff Pb 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. Brinckerhoff Pb 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 Brinckerhoff Pb 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.
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 Brinckerhoff Pb 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.
Better consumer reach
– The expansion of the 5G network will help Brinckerhoff Pb to increase its market reach. Brinckerhoff Pb 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Brinckerhoff Pb in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Brinckerhoff Pb 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 Parsons Brinckerhoff: The Second Avenue Subway (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Brinckerhoff Pb to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Parsons Brinckerhoff: The Second Avenue Subway (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Parsons Brinckerhoff: The Second Avenue Subway (A) are -
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 Brinckerhoff Pb business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Brinckerhoff Pb can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
High dependence on third party suppliers
– Brinckerhoff Pb 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Parsons Brinckerhoff: The Second Avenue Subway (A), Brinckerhoff Pb may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Brinckerhoff Pb 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 Parsons Brinckerhoff: The Second Avenue Subway (A) .
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 Brinckerhoff Pb in the Sales & Marketing sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Brinckerhoff Pb 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.
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. Brinckerhoff Pb needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Brinckerhoff Pb in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Increasing wage structure of Brinckerhoff Pb
– 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 Brinckerhoff Pb.
Consumer confidence and its impact on Brinckerhoff Pb 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.
Shortening product life cycle
– it is one of the major threat that Brinckerhoff Pb is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Parsons Brinckerhoff: The Second Avenue Subway (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 Parsons Brinckerhoff: The Second Avenue Subway (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 Parsons Brinckerhoff: The Second Avenue Subway (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 Parsons Brinckerhoff: The Second Avenue Subway (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 Parsons Brinckerhoff: The Second Avenue Subway (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 Brinckerhoff Pb needs to make to build a sustainable competitive advantage.
