Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back
This article explores the rise to quality leadership by Japanese automakers, the decline in U.S. automakers' quality reputation, and whether poor quality still contributes to the U.S. automaker's competitive woes. Perception plays a key role in quality competition but not necessarily in ways that we commonly think. The ways in which information about quality performance is displayed plays an important role in customer perception. Quality should not be seen as a stand-alone asset but rather it must be understood in the context of other assets, including a firm's brand equity. It is quality's relationship to brand equity that helps explain the current quandary of U.S. automakers, and this relationship holds lessons for other industries.
Swot Analysis of "Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back" written by Robert E. Cole, Michael S. Flynn includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Automakers Quality facing as an external strategic factors. Some of the topics covered in Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back case study are - Strategic Management Strategies, Product development and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back casestudy better are - – increasing energy prices, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs,
technology disruption, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Automakers Quality, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Automakers Quality 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back can be done for the following purposes –
1. Strategic planning using facts provided in Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back case study
2. Improving business portfolio management of Automakers Quality
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 Automakers Quality
Strengths Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Automakers Quality in Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Automakers Quality in the sector have low bargaining power. Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Automakers Quality to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Automakers Quality digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Automakers Quality 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.
High brand equity
– Automakers Quality has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Automakers Quality to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Automakers Quality
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Automakers Quality does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Automakers Quality has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Automakers Quality 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.
High switching costs
– The high switching costs that Automakers Quality 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.
Effective Research and Development (R&D)
– Automakers Quality 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back - 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 lead change in Sales & Marketing field
– Automakers Quality is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Automakers Quality in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Automakers Quality is one of the most innovative firm in sector. Manager in Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Automakers Quality 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 Robert E. Cole, Michael S. Flynn 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.
Operational resilience
– The operational resilience strategy in the Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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.
Sustainable margins compare to other players in Sales & Marketing industry
– Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back firm has clearly differentiated products in the market place. This has enabled Automakers Quality to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Automakers Quality to invest into research and development (R&D) and innovation.
Weaknesses Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back are -
High cash cycle compare to competitors
Automakers Quality 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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 Automakers Quality 's lucrative customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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 Automakers Quality has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Automakers Quality 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.
Products dominated business model
– Even though Automakers Quality 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 - Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back should strive to include more intangible value offerings along with its core products and services.
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 Automakers Quality supply chain. Even after few cautionary changes mentioned in the HBR case study - Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Automakers Quality vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Automakers Quality is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Automakers Quality needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Automakers Quality to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Automakers Quality, firm in the HBR case study Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back, in the dynamic environment Automakers Quality has struggled to respond to the nimble upstart competition. Automakers Quality has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Automakers Quality 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.
Slow to strategic competitive environment developments
– As Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back HBR case study mentions - Automakers Quality 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.
Opportunities Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back | 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back are -
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 Automakers Quality in the consumer business. Now Automakers Quality can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Automakers Quality to increase its market reach. Automakers Quality 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.
Creating value in data economy
– The success of analytics program of Automakers Quality has opened avenues for new revenue streams for the organization in the industry. This can help Automakers Quality to build a more holistic ecosystem as suggested in the Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back case study. Automakers Quality can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Automakers Quality 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, Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Automakers Quality can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Automakers Quality can use these opportunities to build new business models that can help the communities that Automakers Quality operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Manufacturing automation
– Automakers Quality 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.
Buying journey improvements
– Automakers Quality can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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.
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 Automakers Quality 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Automakers Quality in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Automakers Quality 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.
Using analytics as competitive advantage
– Automakers Quality 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Automakers Quality to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Automakers Quality can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Threats Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back are -
High dependence on third party suppliers
– Automakers Quality 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.
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. Automakers Quality 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 Automakers Quality 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
– Automakers Quality has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Automakers Quality 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.
Regulatory challenges
– Automakers Quality 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.
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 Automakers Quality business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Automakers Quality
– 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 Automakers Quality.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back, Automakers Quality 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 .
Environmental challenges
– Automakers Quality 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. Automakers Quality can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Automakers Quality can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Automakers Quality 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back .
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.
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 Automakers Quality.
Weighted SWOT Analysis of Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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 Automotive Quality Reputation: Hard to Achieve, Hard to Lose, Still Harder to Win Back 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 Automakers Quality needs to make to build a sustainable competitive advantage.
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