Customer Value Measurement at Nortel Networks--Optical Networks Division SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Customer Value Measurement at Nortel Networks--Optical Networks Division
Since 1995, Nortel Networks' Optical Networks (ON) division has been incorporating customer satisfaction and loyalty measures into its business practices to increase customer value. Over the years, key process owners in various parts of the organization have become accustomed to receiving such information in the format with which they are familiar. Recent initiatives by the Customer Value Measurement (CVM) team have shown that the current methodology does not provide all the insights required to achieve the full potential of customer value measurement. The CVM team now needs to present Nortel's senior management with the optimal combination of the many choices for soliciting customer perceptions that would make the best use of available resources, minimize the intrusion on customers' time, and add value for the business and customers alike.
Swot Analysis of "Customer Value Measurement at Nortel Networks--Optical Networks Division" written by Das Narayandas includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cvm Networks facing as an external strategic factors. Some of the topics covered in Customer Value Measurement at Nortel Networks--Optical Networks Division case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Customer Value Measurement at Nortel Networks--Optical Networks Division casestudy better are - – central banks are concerned over increasing inflation, there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, increasing energy prices, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs,
increasing commodity prices, technology disruption, etc
Introduction to SWOT Analysis of Customer Value Measurement at Nortel Networks--Optical Networks Division
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Customer Value Measurement at Nortel Networks--Optical Networks Division case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cvm Networks, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cvm Networks 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 Customer Value Measurement at Nortel Networks--Optical Networks Division can be done for the following purposes –
1. Strategic planning using facts provided in Customer Value Measurement at Nortel Networks--Optical Networks Division case study
2. Improving business portfolio management of Cvm Networks
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 Cvm Networks
Strengths Customer Value Measurement at Nortel Networks--Optical Networks Division | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cvm Networks in Customer Value Measurement at Nortel Networks--Optical Networks Division Harvard Business Review case study are -
Effective Research and Development (R&D)
– Cvm Networks 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 Customer Value Measurement at Nortel Networks--Optical Networks Division - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Cvm Networks is one of the leading recruiters in the industry. Managers in the Customer Value Measurement at Nortel Networks--Optical Networks Division are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Cvm Networks 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 Das Narayandas 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.
Strong track record of project management
– Cvm Networks is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Cvm Networks 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 Cvm Networks is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Customer Value Measurement at Nortel Networks--Optical Networks Division Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Cvm Networks is one of the most innovative firm in sector. Manager in Customer Value Measurement at Nortel Networks--Optical Networks Division Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Cvm Networks 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.
Low bargaining power of suppliers
– Suppliers of Cvm Networks in the sector have low bargaining power. Customer Value Measurement at Nortel Networks--Optical Networks Division has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cvm Networks to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Cvm Networks has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Cvm Networks 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.
Sustainable margins compare to other players in Sales & Marketing industry
– Customer Value Measurement at Nortel Networks--Optical Networks Division firm has clearly differentiated products in the market place. This has enabled Cvm Networks to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Cvm Networks to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Cvm Networks 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Cvm Networks digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cvm Networks has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Weaknesses Customer Value Measurement at Nortel Networks--Optical Networks Division | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Customer Value Measurement at Nortel Networks--Optical Networks Division are -
Workers concerns about automation
– As automation is fast increasing in the segment, Cvm Networks 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.
Interest costs
– Compare to the competition, Cvm Networks 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 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 Cvm Networks supply chain. Even after few cautionary changes mentioned in the HBR case study - Customer Value Measurement at Nortel Networks--Optical Networks Division, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cvm Networks vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Customer Value Measurement at Nortel Networks--Optical Networks Division HBR case study mentions - Cvm Networks 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Customer Value Measurement at Nortel Networks--Optical Networks Division 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 Cvm Networks has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Customer Value Measurement at Nortel Networks--Optical Networks Division, is just above the industry average. Cvm Networks 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Customer Value Measurement at Nortel Networks--Optical Networks Division 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 Cvm Networks 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Customer Value Measurement at Nortel Networks--Optical Networks Division, it seems that the employees of Cvm Networks 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cvm Networks is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Customer Value Measurement at Nortel Networks--Optical Networks Division 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, Cvm Networks 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.
Increasing silos among functional specialists
– The organizational structure of Cvm Networks is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Cvm Networks needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cvm Networks to focus more on services rather than just following the product oriented approach.
Opportunities Customer Value Measurement at Nortel Networks--Optical Networks Division | 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 Customer Value Measurement at Nortel Networks--Optical Networks Division are -
Manufacturing automation
– Cvm Networks 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cvm Networks 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 Cvm Networks 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 Cvm Networks in the consumer business. Now Cvm Networks can target international markets with far fewer capital restrictions requirements than the existing system.
Buying journey improvements
– Cvm Networks can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Customer Value Measurement at Nortel Networks--Optical Networks Division 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.
Building a culture of innovation
– managers at Cvm Networks 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.
Creating value in data economy
– The success of analytics program of Cvm Networks has opened avenues for new revenue streams for the organization in the industry. This can help Cvm Networks to build a more holistic ecosystem as suggested in the Customer Value Measurement at Nortel Networks--Optical Networks Division case study. Cvm Networks can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Cvm Networks 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. Cvm Networks 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 Cvm Networks 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.
Using analytics as competitive advantage
– Cvm Networks 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 Customer Value Measurement at Nortel Networks--Optical Networks Division - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cvm Networks to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Cvm Networks 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Cvm Networks can use these opportunities to build new business models that can help the communities that Cvm Networks operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cvm Networks can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Cvm Networks can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Customer Value Measurement at Nortel Networks--Optical Networks Division External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Customer Value Measurement at Nortel Networks--Optical Networks Division are -
Increasing wage structure of Cvm Networks
– 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 Cvm Networks.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cvm Networks 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.
Environmental challenges
– Cvm Networks 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. Cvm Networks can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Cvm Networks with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Cvm Networks business can come under increasing regulations regarding data privacy, data security, etc.
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. Cvm Networks needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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 Cvm Networks.
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. Cvm Networks 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.
Consumer confidence and its impact on Cvm Networks demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Cvm Networks has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Cvm Networks 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.
Stagnating economy with rate increase
– Cvm Networks 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cvm Networks 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 Customer Value Measurement at Nortel Networks--Optical Networks Division .
High dependence on third party suppliers
– Cvm Networks 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 Customer Value Measurement at Nortel Networks--Optical Networks Division 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 Customer Value Measurement at Nortel Networks--Optical Networks Division 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 Customer Value Measurement at Nortel Networks--Optical Networks Division 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 Customer Value Measurement at Nortel Networks--Optical Networks Division 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 Customer Value Measurement at Nortel Networks--Optical Networks Division 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 Cvm Networks needs to make to build a sustainable competitive advantage.