The worldwide sales and marketing manager must determine the degree to which pricing strategy and tactics should be standardized or left to the discretion of the DHL subsidiary in each country.
Swot Analysis of "DHL Worldwide Express" written by John A. Quelch, Greg Conley includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dhl Worldwide facing as an external strategic factors. Some of the topics covered in DHL Worldwide Express case study are - Strategic Management Strategies, Pricing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the DHL Worldwide Express casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing commodity prices, increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, technology disruption, increasing energy prices, geopolitical disruptions,
banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of DHL Worldwide Express
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in DHL Worldwide Express case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dhl Worldwide, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dhl Worldwide 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 DHL Worldwide Express can be done for the following purposes –
1. Strategic planning using facts provided in DHL Worldwide Express case study
2. Improving business portfolio management of Dhl Worldwide
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 Dhl Worldwide
Strengths DHL Worldwide Express | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dhl Worldwide in DHL Worldwide Express Harvard Business Review case study are -
Diverse revenue streams
– Dhl Worldwide is present in almost all the verticals within the industry. This has provided firm in DHL Worldwide Express 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.
High brand equity
– Dhl Worldwide has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dhl Worldwide to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Dhl Worldwide 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 DHL Worldwide Express HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Dhl Worldwide is one of the most innovative firm in sector. Manager in DHL Worldwide Express Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Sales & Marketing industry
– DHL Worldwide Express firm has clearly differentiated products in the market place. This has enabled Dhl Worldwide to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Dhl Worldwide to invest into research and development (R&D) and innovation.
Organizational Resilience of Dhl Worldwide
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Dhl Worldwide does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Dhl Worldwide is one of the leading recruiters in the industry. Managers in the DHL Worldwide Express are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Dhl Worldwide 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 DHL Worldwide Express 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.
Low bargaining power of suppliers
– Suppliers of Dhl Worldwide in the sector have low bargaining power. DHL Worldwide Express has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Dhl Worldwide to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Dhl Worldwide 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 Dhl Worldwide is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in DHL Worldwide Express Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Dhl Worldwide has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in DHL Worldwide Express 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.
Weaknesses DHL Worldwide Express | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of DHL Worldwide Express are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study DHL Worldwide Express, is just above the industry average. Dhl Worldwide 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.
Slow to strategic competitive environment developments
– As DHL Worldwide Express HBR case study mentions - Dhl Worldwide 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 cash cycle compare to competitors
Dhl Worldwide 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.
Low market penetration in new markets
– Outside its home market of Dhl Worldwide, firm in the HBR case study DHL Worldwide Express needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study DHL Worldwide Express, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study DHL Worldwide Express, in the dynamic environment Dhl Worldwide has struggled to respond to the nimble upstart competition. Dhl Worldwide 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 Dhl Worldwide 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 - DHL Worldwide Express should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, John A. Quelch, Greg Conley suggests that, Dhl Worldwide 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.
Aligning sales with marketing
– It come across in the case study DHL Worldwide Express 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 DHL Worldwide Express can leverage the sales team experience to cultivate customer relationships as Dhl Worldwide is planning to shift buying processes online.
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 Dhl Worldwide supply chain. Even after few cautionary changes mentioned in the HBR case study - DHL Worldwide Express, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Dhl Worldwide vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Dhl Worldwide is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Dhl Worldwide needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Dhl Worldwide to focus more on services rather than just following the product oriented approach.
Opportunities DHL Worldwide Express | 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 DHL Worldwide Express are -
Manufacturing automation
– Dhl Worldwide 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.
Learning at scale
– Online learning technologies has now opened space for Dhl Worldwide 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.
Loyalty marketing
– Dhl Worldwide 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Dhl Worldwide can use these opportunities to build new business models that can help the communities that Dhl Worldwide operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Developing new processes and practices
– Dhl Worldwide 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Dhl Worldwide 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.
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 Dhl Worldwide 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.
Using analytics as competitive advantage
– Dhl Worldwide 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 DHL Worldwide Express - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dhl Worldwide to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Dhl Worldwide can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. DHL Worldwide Express 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.
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. Dhl Worldwide can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Dhl Worldwide 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.
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. Dhl Worldwide can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Dhl Worldwide 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. Dhl Worldwide 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 DHL Worldwide Express External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study DHL Worldwide Express are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study DHL Worldwide Express, Dhl Worldwide may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Stagnating economy with rate increase
– Dhl Worldwide can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
High dependence on third party suppliers
– Dhl Worldwide 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.
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.
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 Dhl Worldwide business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dhl Worldwide 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.
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 Dhl Worldwide.
Environmental challenges
– Dhl Worldwide 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. Dhl Worldwide can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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. Dhl Worldwide needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Regulatory challenges
– Dhl Worldwide 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Dhl Worldwide with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Dhl Worldwide 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 DHL Worldwide Express 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 DHL Worldwide Express 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 DHL Worldwide Express 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 DHL Worldwide Express 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 DHL Worldwide Express 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 Dhl Worldwide needs to make to build a sustainable competitive advantage.
