Case Study Description of Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma
Worldwide Equipment Ltd. is one of the world's largest manufacturers of heating, ventilating, and air-conditioning equipment. The Beijing regional sales manager has just heard that the sales performance of his office ranked the lowest among the sales offices in China. As a result, the Beijing sales force will not receive their year-end bonuses unless the situation can be turned around quickly. The regional sales manager must determine whether the sales management process or a recent new hire on the sales force, whose hiring was strongly suggested by the manager's boss, are to blame for the poor sales performance and how to keep the situation from recurring.
Swot Analysis of "Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma" written by June Cotte, Alan Wenchu Yang includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sales Equipment facing as an external strategic factors. Some of the topics covered in Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma case study are - Strategic Management Strategies, Manufacturing, Organizational culture, Performance measurement, Sales and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma casestudy better are - – geopolitical disruptions, supply chains are disrupted by pandemic , wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, there is backlash against globalization,
central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sales Equipment, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sales Equipment 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma can be done for the following purposes –
1. Strategic planning using facts provided in Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma case study
2. Improving business portfolio management of Sales Equipment
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 Sales Equipment
Strengths Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sales Equipment in Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma Harvard Business Review case study are -
Strong track record of project management
– Sales Equipment 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 brand equity
– Sales Equipment has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sales Equipment to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Sales Equipment 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 June Cotte, Alan Wenchu Yang 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Sales Equipment digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sales Equipment 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.
Operational resilience
– The operational resilience strategy in the Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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.
Diverse revenue streams
– Sales Equipment is present in almost all the verticals within the industry. This has provided firm in Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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.
Superior customer experience
– The customer experience strategy of Sales Equipment in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Sales Equipment is one of the most innovative firm in sector. Manager in Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Sales Equipment 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 Sales Equipment is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Sales Equipment 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Sales Equipment in the sector have low bargaining power. Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sales Equipment to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Sales Equipment has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma are -
Low market penetration in new markets
– Outside its home market of Sales Equipment, firm in the HBR case study Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sales Equipment is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners
– Because of the regulatory requirements, June Cotte, Alan Wenchu Yang suggests that, Sales Equipment 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.
Lack of clear differentiation of Sales Equipment products
– To increase the profitability and margins on the products, Sales Equipment needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Sales Equipment has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Sales Equipment even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Increasing silos among functional specialists
– The organizational structure of Sales Equipment is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Sales Equipment needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Sales Equipment to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Sales Equipment 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.
Interest costs
– Compare to the competition, Sales Equipment 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma, it seems that the employees of Sales Equipment 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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 Sales Equipment has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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 Sales Equipment 's lucrative customers.
Opportunities Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma | 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma are -
Building a culture of innovation
– managers at Sales Equipment 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. Sales Equipment can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Sales Equipment 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sales Equipment can use these opportunities to build new business models that can help the communities that Sales Equipment operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Creating value in data economy
– The success of analytics program of Sales Equipment has opened avenues for new revenue streams for the organization in the industry. This can help Sales Equipment to build a more holistic ecosystem as suggested in the Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma case study. Sales Equipment can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Sales Equipment 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 Sales Equipment 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.
Manufacturing automation
– Sales Equipment 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sales Equipment 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, Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Sales Equipment in the consumer business. Now Sales Equipment can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sales Equipment is facing challenges because of the dominance of functional experts in the organization. Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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.
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. Sales Equipment 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. Sales Equipment 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.
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. Sales Equipment can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma are -
Technology acceleration in Forth Industrial Revolution
– Sales Equipment has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Sales Equipment 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 Sales Equipment 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.
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 Sales Equipment in the Sales & Marketing sector and impact the bottomline of the organization.
Environmental challenges
– Sales Equipment 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. Sales Equipment can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
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 Sales Equipment business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Sales Equipment 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Sales Equipment 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.
Regulatory challenges
– Sales Equipment 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma, Sales Equipment 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 .
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. Sales Equipment needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
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.
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. Sales Equipment 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.
Weighted SWOT Analysis of Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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 Worldwide Equipment (China) Ltd.: A Sales Performance Dilemma 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 Sales Equipment needs to make to build a sustainable competitive advantage.
