Case Study Description of Block 16: Environmental Groups' Perspectives
Supplements Block 16: Conoco's Green Oil Strategy (A). Provides the environmental groups' perspective on Conoco's Ecuadorian strategy. Designed to be distributed to students who will be playing the role of Ecuadorian environmentalists.
Swot Analysis of "Block 16: Environmental Groups' Perspectives" written by Malcolm S. Salter, Susan E.A. Hall includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ecuadorian Conoco's facing as an external strategic factors. Some of the topics covered in Block 16: Environmental Groups' Perspectives case study are - Strategic Management Strategies, Ethics, Marketing, Policy, Social responsibility, Sustainability and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Block 16: Environmental Groups' Perspectives casestudy better are - – increasing commodity prices, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, geopolitical disruptions,
challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Block 16: Environmental Groups' Perspectives
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Block 16: Environmental Groups' Perspectives case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ecuadorian Conoco's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ecuadorian Conoco's 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 Block 16: Environmental Groups' Perspectives can be done for the following purposes –
1. Strategic planning using facts provided in Block 16: Environmental Groups' Perspectives case study
2. Improving business portfolio management of Ecuadorian Conoco's
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ecuadorian Conoco's
Strengths Block 16: Environmental Groups' Perspectives | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ecuadorian Conoco's in Block 16: Environmental Groups' Perspectives Harvard Business Review case study are -
High switching costs
– The high switching costs that Ecuadorian Conoco's 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.
Ability to lead change in Strategy & Execution field
– Ecuadorian Conoco's 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 Ecuadorian Conoco's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Ecuadorian Conoco's 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 Block 16: Environmental Groups' Perspectives - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Ecuadorian Conoco's 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 Block 16: Environmental Groups' Perspectives HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Ecuadorian Conoco's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Ecuadorian Conoco's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ecuadorian Conoco's 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.
Ability to recruit top talent
– Ecuadorian Conoco's is one of the leading recruiters in the industry. Managers in the Block 16: Environmental Groups' Perspectives are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Ecuadorian Conoco's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Ecuadorian Conoco's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Strategy & Execution industry
– Block 16: Environmental Groups' Perspectives firm has clearly differentiated products in the market place. This has enabled Ecuadorian Conoco's to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Ecuadorian Conoco's to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Ecuadorian Conoco's 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.
Organizational Resilience of Ecuadorian Conoco's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ecuadorian Conoco's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Ecuadorian Conoco's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Block 16: Environmental Groups' Perspectives 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 Block 16: Environmental Groups' Perspectives | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Block 16: Environmental Groups' Perspectives are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Block 16: Environmental Groups' Perspectives, it seems that the employees of Ecuadorian Conoco's 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 cash cycle compare to competitors
Ecuadorian Conoco's 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 bargaining power of channel partners
– Because of the regulatory requirements, Malcolm S. Salter, Susan E.A. Hall suggests that, Ecuadorian Conoco's 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.
Interest costs
– Compare to the competition, Ecuadorian Conoco's 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.
Capital Spending Reduction
– Even during the low interest decade, Ecuadorian Conoco's 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.
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 Ecuadorian Conoco's supply chain. Even after few cautionary changes mentioned in the HBR case study - Block 16: Environmental Groups' Perspectives, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Ecuadorian Conoco's vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ecuadorian Conoco's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Block 16: Environmental Groups' Perspectives can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Ecuadorian Conoco's, firm in the HBR case study Block 16: Environmental Groups' Perspectives needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Block 16: Environmental Groups' Perspectives 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 Ecuadorian Conoco's has relatively successful track record of launching new products.
Products dominated business model
– Even though Ecuadorian Conoco's 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 - Block 16: Environmental Groups' Perspectives should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Ecuadorian Conoco's is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Ecuadorian Conoco's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ecuadorian Conoco's to focus more on services rather than just following the product oriented approach.
Opportunities Block 16: Environmental Groups' Perspectives | 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 Block 16: Environmental Groups' Perspectives are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Ecuadorian Conoco's 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.
Buying journey improvements
– Ecuadorian Conoco's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Block 16: Environmental Groups' Perspectives 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ecuadorian Conoco's 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, Block 16: Environmental Groups' Perspectives, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Ecuadorian Conoco's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ecuadorian Conoco's is facing challenges because of the dominance of functional experts in the organization. Block 16: Environmental Groups' Perspectives 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.
Loyalty marketing
– Ecuadorian Conoco's 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.
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 Ecuadorian Conoco's in the consumer business. Now Ecuadorian Conoco's can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Ecuadorian Conoco's 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.
Learning at scale
– Online learning technologies has now opened space for Ecuadorian Conoco's 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.
Manufacturing automation
– Ecuadorian Conoco's can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Ecuadorian Conoco's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
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. Ecuadorian Conoco's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ecuadorian Conoco's 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. Ecuadorian Conoco's 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 Block 16: Environmental Groups' Perspectives External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Block 16: Environmental Groups' Perspectives are -
Consumer confidence and its impact on Ecuadorian Conoco's 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.
Increasing wage structure of Ecuadorian Conoco's
– 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 Ecuadorian Conoco's.
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. Ecuadorian Conoco's 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.
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 Ecuadorian Conoco's.
High dependence on third party suppliers
– Ecuadorian Conoco's 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.
Technology acceleration in Forth Industrial Revolution
– Ecuadorian Conoco's has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Ecuadorian Conoco's needs to keep up with the evolution of technology in the Strategy & Execution 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.
Shortening product life cycle
– it is one of the major threat that Ecuadorian Conoco's is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Ecuadorian Conoco's 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 Strategy & Execution industry regulations.
Stagnating economy with rate increase
– Ecuadorian Conoco's 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ecuadorian Conoco's in the Strategy & Execution industry. The Strategy & Execution 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ecuadorian Conoco's 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 Block 16: Environmental Groups' Perspectives .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Block 16: Environmental Groups' Perspectives, Ecuadorian Conoco's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Environmental challenges
– Ecuadorian Conoco's 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. Ecuadorian Conoco's can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Weighted SWOT Analysis of Block 16: Environmental Groups' Perspectives 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 Block 16: Environmental Groups' Perspectives 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 Block 16: Environmental Groups' Perspectives 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 Block 16: Environmental Groups' Perspectives 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 Block 16: Environmental Groups' Perspectives 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 Ecuadorian Conoco's needs to make to build a sustainable competitive advantage.