The Motor City: Rebuilding Detroit's Image Post-bankruptcy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Motor City: Rebuilding Detroit's Image Post-bankruptcy
Rebranding is a marketing strategy often used by companies. The rebranding of a city is not only less common but far more complex. By 2013, the city of Detroit, Michigan was facing a multitude of problems: declining population, crumbling roads and bridges, abandoned properties, an alarming school drop-out rate, poverty, high cost of pension plans, government corruption, growing crime and crippled emergency services. The 2008 recession had dealt a serious blow to its core automotive industrial sector, and although some high tech companies were moving in, the "Motor City" was wallowing in debt. In July 2013, Detroit filed for bankruptcy protection, which was granted that December. Its financial emergency manager was able to strike deals with its major debt-holders, the banks, and with the city's largest union, but these forward steps were threatened when the water department started cutting off water to households that could not pay bills that had risen 120 per cent over the past decade. How does a city facing outraged residents and investors, that lacks infrastructure to such a degree that almost half of its traffic lights are non-functional and that is in an atrocious financial state repair its image and attract new investors?
Authors :: Dante Pirouz, Karam Putros, Nithiyaa Pushpanathan
Swot Analysis of "The Motor City: Rebuilding Detroit's Image Post-bankruptcy" written by Dante Pirouz, Karam Putros, Nithiyaa Pushpanathan includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that City Detroit facing as an external strategic factors. Some of the topics covered in The Motor City: Rebuilding Detroit's Image Post-bankruptcy case study are - Strategic Management Strategies, Government and Sales & Marketing.
Some of the macro environment factors that can be used to understand the The Motor City: Rebuilding Detroit's Image Post-bankruptcy casestudy better are - – cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, technology disruption,
challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of The Motor City: Rebuilding Detroit's Image Post-bankruptcy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Motor City: Rebuilding Detroit's Image Post-bankruptcy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the City Detroit, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which City Detroit 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 The Motor City: Rebuilding Detroit's Image Post-bankruptcy can be done for the following purposes –
1. Strategic planning using facts provided in The Motor City: Rebuilding Detroit's Image Post-bankruptcy case study
2. Improving business portfolio management of City Detroit
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 City Detroit
Strengths The Motor City: Rebuilding Detroit's Image Post-bankruptcy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of City Detroit in The Motor City: Rebuilding Detroit's Image Post-bankruptcy Harvard Business Review case study are -
High brand equity
– City Detroit has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled City Detroit to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– City Detroit 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 City Detroit in the sector have low bargaining power. The Motor City: Rebuilding Detroit's Image Post-bankruptcy has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps City Detroit to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the City Detroit 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.
Diverse revenue streams
– City Detroit is present in almost all the verticals within the industry. This has provided firm in The Motor City: Rebuilding Detroit's Image Post-bankruptcy 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.
Effective Research and Development (R&D)
– City Detroit 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 The Motor City: Rebuilding Detroit's Image Post-bankruptcy - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– City Detroit is one of the most innovative firm in sector. Manager in The Motor City: Rebuilding Detroit's Image Post-bankruptcy Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Sales & Marketing field
– City Detroit 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 City Detroit in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– City Detroit is one of the leading recruiters in the industry. Managers in the The Motor City: Rebuilding Detroit's Image Post-bankruptcy are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of City Detroit
– The covid-19 pandemic has put organizational resilience at the centre of everthing that City Detroit does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of City Detroit in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Sales & Marketing industry
– The Motor City: Rebuilding Detroit's Image Post-bankruptcy firm has clearly differentiated products in the market place. This has enabled City Detroit to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped City Detroit to invest into research and development (R&D) and innovation.
Weaknesses The Motor City: Rebuilding Detroit's Image Post-bankruptcy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Motor City: Rebuilding Detroit's Image Post-bankruptcy are -
High operating costs
– Compare to the competitors, firm in the HBR case study The Motor City: Rebuilding Detroit's Image Post-bankruptcy 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 City Detroit 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Motor City: Rebuilding Detroit's Image Post-bankruptcy, it seems that the employees of City Detroit 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Motor City: Rebuilding Detroit's Image Post-bankruptcy, in the dynamic environment City Detroit has struggled to respond to the nimble upstart competition. City Detroit has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Products dominated business model
– Even though City Detroit has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - The Motor City: Rebuilding Detroit's Image Post-bankruptcy should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, City Detroit 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 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 City Detroit supply chain. Even after few cautionary changes mentioned in the HBR case study - The Motor City: Rebuilding Detroit's Image Post-bankruptcy, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left City Detroit vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of City Detroit products
– To increase the profitability and margins on the products, City Detroit needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As The Motor City: Rebuilding Detroit's Image Post-bankruptcy HBR case study mentions - City Detroit 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, City Detroit is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Motor City: Rebuilding Detroit's Image Post-bankruptcy can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, City Detroit 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.
High cash cycle compare to competitors
City Detroit 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.
Opportunities The Motor City: Rebuilding Detroit's Image Post-bankruptcy | 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 The Motor City: Rebuilding Detroit's Image Post-bankruptcy are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, City Detroit is facing challenges because of the dominance of functional experts in the organization. The Motor City: Rebuilding Detroit's Image Post-bankruptcy 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.
Building a culture of innovation
– managers at City Detroit 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.
Manufacturing automation
– City Detroit can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing 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.
Loyalty marketing
– City Detroit 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for City Detroit 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.
Buying journey improvements
– City Detroit can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Motor City: Rebuilding Detroit's Image Post-bankruptcy suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. City Detroit can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. City Detroit can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 City Detroit 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, City Detroit 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, The Motor City: Rebuilding Detroit's Image Post-bankruptcy, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– City Detroit can develop new processes and procedures in Sales & Marketing 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects City Detroit can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. City Detroit 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. City Detroit 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.
Threats The Motor City: Rebuilding Detroit's Image Post-bankruptcy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Motor City: Rebuilding Detroit's Image Post-bankruptcy are -
Environmental challenges
– City Detroit 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. City Detroit can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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.
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 City Detroit 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. City Detroit 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for City Detroit 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.
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. City Detroit needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Regulatory challenges
– City Detroit 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 Sales & Marketing industry regulations.
Shortening product life cycle
– it is one of the major threat that City Detroit is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 City Detroit.
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 City Detroit in the Sales & Marketing sector and impact the bottomline of the organization.
High dependence on third party suppliers
– City Detroit 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.
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. City Detroit can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The Motor City: Rebuilding Detroit's Image Post-bankruptcy, City Detroit 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 .
Weighted SWOT Analysis of The Motor City: Rebuilding Detroit's Image Post-bankruptcy 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 The Motor City: Rebuilding Detroit's Image Post-bankruptcy 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 The Motor City: Rebuilding Detroit's Image Post-bankruptcy 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 The Motor City: Rebuilding Detroit's Image Post-bankruptcy 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 The Motor City: Rebuilding Detroit's Image Post-bankruptcy 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 City Detroit needs to make to build a sustainable competitive advantage.
