Swot Analysis of "3M Chile: Health Care Products (B)" written by Terry H. Deutscher, Daniel D. Campbell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that 3m Chile facing as an external strategic factors. Some of the topics covered in 3M Chile: Health Care Products (B) case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the 3M Chile: Health Care Products (B) casestudy better are - – increasing energy prices, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings,
increasing household debt because of falling income levels, technology disruption, etc
Introduction to SWOT Analysis of 3M Chile: Health Care Products (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in 3M Chile: Health Care Products (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the 3m Chile, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which 3m Chile 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 3M Chile: Health Care Products (B) can be done for the following purposes –
1. Strategic planning using facts provided in 3M Chile: Health Care Products (B) case study
2. Improving business portfolio management of 3m Chile
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 3m Chile
Strengths 3M Chile: Health Care Products (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of 3m Chile in 3M Chile: Health Care Products (B) Harvard Business Review case study are -
Ability to recruit top talent
– 3m Chile is one of the leading recruiters in the industry. Managers in the 3M Chile: Health Care Products (B) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the 3M Chile: Health Care Products (B) 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.
Organizational Resilience of 3m Chile
– The covid-19 pandemic has put organizational resilience at the centre of everthing that 3m Chile 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 3m Chile in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– 3m Chile has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in 3M Chile: Health Care Products (B) 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.
Analytics focus
– 3m Chile 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 Terry H. Deutscher, Daniel D. Campbell 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.
Successful track record of launching new products
– 3m Chile has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. 3m Chile 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.
Highly skilled collaborators
– 3m Chile 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 3M Chile: Health Care Products (B) 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 Sales & Marketing industry
– 3M Chile: Health Care Products (B) firm has clearly differentiated products in the market place. This has enabled 3m Chile to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped 3m Chile to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that 3m Chile 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.
Low bargaining power of suppliers
– Suppliers of 3m Chile in the sector have low bargaining power. 3M Chile: Health Care Products (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps 3m Chile to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– 3m Chile is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses 3M Chile: Health Care Products (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of 3M Chile: Health Care Products (B) are -
Products dominated business model
– Even though 3m Chile 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 - 3M Chile: Health Care Products (B) should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the 3M Chile: Health Care Products (B) 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 3m Chile has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at 3m Chile 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 operating costs
– Compare to the competitors, firm in the HBR case study 3M Chile: Health Care Products (B) 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 3m Chile 's lucrative customers.
High cash cycle compare to competitors
3m Chile 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.
Workers concerns about automation
– As automation is fast increasing in the segment, 3m Chile 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.
Aligning sales with marketing
– It come across in the case study 3M Chile: Health Care Products (B) 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 3M Chile: Health Care Products (B) can leverage the sales team experience to cultivate customer relationships as 3m Chile is planning to shift buying processes online.
Interest costs
– Compare to the competition, 3m Chile 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Terry H. Deutscher, Daniel D. Campbell suggests that, 3m Chile is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study 3M Chile: Health Care Products (B), in the dynamic environment 3m Chile has struggled to respond to the nimble upstart competition. 3m Chile has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of 3m Chile, firm in the HBR case study 3M Chile: Health Care Products (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities 3M Chile: Health Care Products (B) | 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 3M Chile: Health Care Products (B) are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, 3m Chile can use these opportunities to build new business models that can help the communities that 3m Chile operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
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. 3m Chile can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, 3m Chile 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, 3M Chile: Health Care Products (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of 3m Chile has opened avenues for new revenue streams for the organization in the industry. This can help 3m Chile to build a more holistic ecosystem as suggested in the 3M Chile: Health Care Products (B) case study. 3m Chile can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– 3m Chile 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 3M Chile: Health Care Products (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help 3m Chile to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help 3m Chile to increase its market reach. 3m Chile 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.
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 3m Chile in the consumer business. Now 3m Chile can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– 3m Chile 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, 3m Chile is facing challenges because of the dominance of functional experts in the organization. 3M Chile: Health Care Products (B) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, 3m Chile 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.
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. 3m Chile 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. 3m Chile 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects 3m Chile can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. 3m Chile can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats 3M Chile: Health Care Products (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study 3M Chile: Health Care Products (B) are -
Stagnating economy with rate increase
– 3m Chile 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 3m Chile business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study 3M Chile: Health Care Products (B), 3m Chile 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 .
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, 3m Chile 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 3M Chile: Health Care Products (B) .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for 3m Chile 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.
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 3m Chile in the Sales & Marketing sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– 3m Chile has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, 3m Chile 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.
Consumer confidence and its impact on 3m Chile 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.
High dependence on third party suppliers
– 3m Chile 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.
Environmental challenges
– 3m Chile 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. 3m Chile 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.
Shortening product life cycle
– it is one of the major threat that 3m Chile 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 3M Chile: Health Care Products (B) 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 3M Chile: Health Care Products (B) 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 3M Chile: Health Care Products (B) 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 3M Chile: Health Care Products (B) 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 3M Chile: Health Care Products (B) 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 3m Chile needs to make to build a sustainable competitive advantage.