Case Study Description of Decision-making at A-Cat Corp.
The case describes the situation faced by the vice-president of A-CAT Corp. The company was a mid-sized manufacturer and distributor of domestic electrical appliances, largely catering to the price sensitive rural population. The firm operated two medium-sized facilities in one of the remote districts in Vidarbha. A-CAT's manufacturing units had been in operation since 1986. A-CAT manufactured a wide range of electrical appliances including TV signal boosters, transformers, FM radio kits, electronic ballasts, battery chargers and voltage regulators. The focus was on their flagship product, the VR500 voltage regulator. The challenge was to select suppliers without offending the stakeholders involved in the process. The core issue was to come to a correct decision -- one that best suited company needs. The plan set by the team was to identify potential suppliers/vendors with their attendant strengths and weaknesses and to do so in a well-documented and structured manner.
Swot Analysis of "Decision-making at A-Cat Corp." written by Jitendra R. Sharma includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cat Voltage facing as an external strategic factors. Some of the topics covered in Decision-making at A-Cat Corp. case study are - Strategic Management Strategies, Financial analysis and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Decision-making at A-Cat Corp. casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , increasing transportation and logistics costs, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, technology disruption,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing commodity prices, etc
Introduction to SWOT Analysis of Decision-making at A-Cat Corp.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Decision-making at A-Cat Corp. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cat Voltage, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cat Voltage 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 Decision-making at A-Cat Corp. can be done for the following purposes –
1. Strategic planning using facts provided in Decision-making at A-Cat Corp. case study
2. Improving business portfolio management of Cat Voltage
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 Cat Voltage
Strengths Decision-making at A-Cat Corp. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cat Voltage in Decision-making at A-Cat Corp. Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Cat Voltage in the sector have low bargaining power. Decision-making at A-Cat Corp. has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cat Voltage to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Cat Voltage 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 Cat Voltage is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Decision-making at A-Cat Corp. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Cat Voltage is one of the most innovative firm in sector. Manager in Decision-making at A-Cat Corp. Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Cat Voltage has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Decision-making at A-Cat Corp. 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.
Ability to recruit top talent
– Cat Voltage is one of the leading recruiters in the industry. Managers in the Decision-making at A-Cat Corp. are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Highly skilled collaborators
– Cat Voltage 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 Decision-making at A-Cat Corp. HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Cat Voltage 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 Decision-making at A-Cat Corp. 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
– Cat Voltage is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Cat Voltage 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.
Ability to lead change in Sales & Marketing field
– Cat Voltage 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 Cat Voltage in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Diverse revenue streams
– Cat Voltage is present in almost all the verticals within the industry. This has provided firm in Decision-making at A-Cat Corp. 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.
Weaknesses Decision-making at A-Cat Corp. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Decision-making at A-Cat Corp. are -
Workers concerns about automation
– As automation is fast increasing in the segment, Cat Voltage needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Decision-making at A-Cat Corp., is just above the industry average. Cat Voltage 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 Decision-making at A-Cat Corp., in the dynamic environment Cat Voltage has struggled to respond to the nimble upstart competition. Cat Voltage has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Cat Voltage 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.
Increasing silos among functional specialists
– The organizational structure of Cat Voltage is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Cat Voltage needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cat Voltage to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Decision-making at A-Cat Corp. 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 Cat Voltage has relatively successful track record of launching new products.
Lack of clear differentiation of Cat Voltage products
– To increase the profitability and margins on the products, Cat Voltage needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study Decision-making at A-Cat Corp. 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 Decision-making at A-Cat Corp. can leverage the sales team experience to cultivate customer relationships as Cat Voltage is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Decision-making at A-Cat Corp., it seems that the employees of Cat Voltage 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.
Skills based hiring
– The stress on hiring functional specialists at Cat Voltage has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High 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 Cat Voltage supply chain. Even after few cautionary changes mentioned in the HBR case study - Decision-making at A-Cat Corp., it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cat Voltage vulnerable to further global disruptions in South East Asia.
Opportunities Decision-making at A-Cat Corp. | 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 Decision-making at A-Cat Corp. are -
Manufacturing automation
– Cat Voltage 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cat Voltage 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cat Voltage 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, Decision-making at A-Cat Corp., to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Cat Voltage 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. Cat Voltage 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 Cat Voltage 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.
Creating value in data economy
– The success of analytics program of Cat Voltage has opened avenues for new revenue streams for the organization in the industry. This can help Cat Voltage to build a more holistic ecosystem as suggested in the Decision-making at A-Cat Corp. case study. Cat Voltage can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cat Voltage can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Cat Voltage 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.
Using analytics as competitive advantage
– Cat Voltage 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 Decision-making at A-Cat Corp. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cat Voltage to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Cat Voltage 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cat Voltage can use these opportunities to build new business models that can help the communities that Cat Voltage operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
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. Cat Voltage can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Cat Voltage to increase its market reach. Cat Voltage 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.
Threats Decision-making at A-Cat Corp. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Decision-making at A-Cat Corp. are -
Regulatory challenges
– Cat Voltage 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.
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 Cat Voltage in the Sales & Marketing sector and impact the bottomline of the organization.
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 Cat Voltage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cat Voltage with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Decision-making at A-Cat Corp., Cat Voltage 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cat Voltage 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 Decision-making at A-Cat Corp. .
Technology acceleration in Forth Industrial Revolution
– Cat Voltage has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Cat Voltage needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing wage structure of Cat Voltage
– 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 Cat Voltage.
Stagnating economy with rate increase
– Cat Voltage 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.
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 Cat Voltage 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. Cat Voltage 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.
Environmental challenges
– Cat Voltage 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. Cat Voltage can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
High dependence on third party suppliers
– Cat Voltage 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 Decision-making at A-Cat Corp. 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 Decision-making at A-Cat Corp. 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 Decision-making at A-Cat Corp. 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 Decision-making at A-Cat Corp. 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 Decision-making at A-Cat Corp. 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 Cat Voltage needs to make to build a sustainable competitive advantage.
