Case Study Description of CSIRO: The Light Metals Flagship Decision
This case explores the challenge of investing in basic research as a public good. CSIRO was Australia's leading science and research agency, and it was chartered to enhance national prosperity through R&D. Its Flagships program was designed to align research interests with national priorities, with a strong focus on the adoption of research outputs. The Light Metals Flagship (LMF) was one of six flagships established in 2003, and its goal was to help the nation capture more of the added value of its resources by developing and commercializing downstream technologies in the processing and fabrication of products made from aluminum, magnesium, and titanium. While the LMF met with technical successes, Australian industry was reticent to co-invest. This lack of industry enthusiasm was in many ways unsurprising, as governments often found it important to fund long-term basic research that was outside of the horizon of firms. But what kind of a signal would stopping the program send? Was CSIRO prepared to let short-term thinking in light metals firms drive its agenda? The case examines the technical decision-making process.
Swot Analysis of "CSIRO: The Light Metals Flagship Decision" written by Willy Shih, Margaret Pierson, Dawn Lau includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Csiro Metals facing as an external strategic factors. Some of the topics covered in CSIRO: The Light Metals Flagship Decision case study are - Strategic Management Strategies, Globalization, Growth strategy, IT, Manufacturing, Research & development and Strategy & Execution.
Some of the macro environment factors that can be used to understand the CSIRO: The Light Metals Flagship Decision casestudy better are - – increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, challanges to central banks by blockchain based private currencies, 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, technology disruption,
there is increasing trade war between United States & China, wage bills are increasing, etc
Introduction to SWOT Analysis of CSIRO: The Light Metals Flagship Decision
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CSIRO: The Light Metals Flagship Decision case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Csiro Metals, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Csiro Metals 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 CSIRO: The Light Metals Flagship Decision can be done for the following purposes –
1. Strategic planning using facts provided in CSIRO: The Light Metals Flagship Decision case study
2. Improving business portfolio management of Csiro Metals
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 Csiro Metals
Strengths CSIRO: The Light Metals Flagship Decision | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Csiro Metals in CSIRO: The Light Metals Flagship Decision Harvard Business Review case study are -
Highly skilled collaborators
– Csiro Metals 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 CSIRO: The Light Metals Flagship Decision HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Csiro Metals 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 Csiro Metals is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CSIRO: The Light Metals Flagship Decision Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Csiro Metals 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
– Csiro Metals has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Csiro Metals to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the CSIRO: The Light Metals Flagship Decision 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.
High switching costs
– The high switching costs that Csiro Metals 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.
Analytics focus
– Csiro Metals 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 Willy Shih, Margaret Pierson, Dawn Lau 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.
Superior customer experience
– The customer experience strategy of Csiro Metals in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Csiro Metals
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Csiro Metals does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Strategy & Execution industry
– CSIRO: The Light Metals Flagship Decision firm has clearly differentiated products in the market place. This has enabled Csiro Metals to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Csiro Metals to invest into research and development (R&D) and innovation.
Low bargaining power of suppliers
– Suppliers of Csiro Metals in the sector have low bargaining power. CSIRO: The Light Metals Flagship Decision has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Csiro Metals to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Csiro Metals 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 CSIRO: The Light Metals Flagship Decision - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses CSIRO: The Light Metals Flagship Decision | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CSIRO: The Light Metals Flagship Decision are -
Slow decision making process
– As mentioned earlier in the report, Csiro Metals 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. Csiro Metals 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study CSIRO: The Light Metals Flagship Decision, it seems that the employees of Csiro Metals 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.
Increasing silos among functional specialists
– The organizational structure of Csiro Metals is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Csiro Metals needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Csiro Metals to focus more on services rather than just following the product oriented approach.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Csiro Metals is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study CSIRO: The Light Metals Flagship Decision 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, Willy Shih, Margaret Pierson, Dawn Lau suggests that, Csiro Metals 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.
Need for greater diversity
– Csiro Metals has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Interest costs
– Compare to the competition, Csiro Metals has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Csiro Metals supply chain. Even after few cautionary changes mentioned in the HBR case study - CSIRO: The Light Metals Flagship Decision, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Csiro Metals vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Csiro Metals 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 - CSIRO: The Light Metals Flagship Decision should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study CSIRO: The Light Metals Flagship Decision 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 Csiro Metals 's lucrative customers.
Capital Spending Reduction
– Even during the low interest decade, Csiro Metals 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.
Opportunities CSIRO: The Light Metals Flagship Decision | 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 CSIRO: The Light Metals Flagship Decision are -
Building a culture of innovation
– managers at Csiro Metals 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 Strategy & Execution segment.
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 Csiro Metals 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.
Buying journey improvements
– Csiro Metals can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. CSIRO: The Light Metals Flagship Decision 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.
Creating value in data economy
– The success of analytics program of Csiro Metals has opened avenues for new revenue streams for the organization in the industry. This can help Csiro Metals to build a more holistic ecosystem as suggested in the CSIRO: The Light Metals Flagship Decision case study. Csiro Metals can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Csiro Metals 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.
Leveraging digital technologies
– Csiro Metals 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.
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. Csiro Metals 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. Csiro Metals 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Csiro Metals is facing challenges because of the dominance of functional experts in the organization. CSIRO: The Light Metals Flagship Decision 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.
Better consumer reach
– The expansion of the 5G network will help Csiro Metals to increase its market reach. Csiro Metals 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Csiro Metals to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Csiro Metals to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Csiro Metals 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, Csiro Metals can use these opportunities to build new business models that can help the communities that Csiro Metals operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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 Csiro Metals in the consumer business. Now Csiro Metals can target international markets with far fewer capital restrictions requirements than the existing system.
Threats CSIRO: The Light Metals Flagship Decision External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CSIRO: The Light Metals Flagship Decision are -
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. Csiro Metals 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Csiro Metals 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.
Stagnating economy with rate increase
– Csiro Metals 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.
Environmental challenges
– Csiro Metals 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. Csiro Metals can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Csiro Metals business can come under increasing regulations regarding data privacy, data security, etc.
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 Csiro Metals in the Strategy & Execution sector and impact the bottomline of the organization.
Increasing wage structure of Csiro Metals
– 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 Csiro Metals.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Csiro Metals 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 CSIRO: The Light Metals Flagship Decision .
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.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Csiro Metals can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Csiro Metals needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Csiro Metals is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Csiro Metals 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.
Weighted SWOT Analysis of CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision 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 Csiro Metals needs to make to build a sustainable competitive advantage.