Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change
Case A: Presents three strategic options considered by a fictitious international oil and gas corporation to address the issue of climate change: fight against action, wait and see, and dynamic proactive.
Authors :: Marc Le Menestrel, Sybille Van den Hove, Henri-Claude De Bettignies
Swot Analysis of "Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change" written by Marc Le Menestrel, Sybille Van den Hove, Henri-Claude De Bettignies includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Climate Oil facing as an external strategic factors. Some of the topics covered in Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change case study are - Strategic Management Strategies, Globalization, Social responsibility, Sustainability and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation,
increasing household debt because of falling income levels, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Climate Oil, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Climate Oil 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 Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change can be done for the following purposes –
1. Strategic planning using facts provided in Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change case study
2. Improving business portfolio management of Climate Oil
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 Climate Oil
Strengths Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Climate Oil in Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change Harvard Business Review case study are -
Organizational Resilience of Climate Oil
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Climate Oil does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Climate Oil has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Climate Oil to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Climate Oil 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.
High switching costs
– The high switching costs that Climate Oil 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.
Learning organization
- Climate Oil 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 Climate Oil is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Climate Oil has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Climate Oil 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
– Climate Oil is one of the leading recruiters in the industry. Managers in the Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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.
Strong track record of project management
– Climate Oil is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Climate Oil in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Climate Oil is one of the most innovative firm in sector. Manager in Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Climate Oil digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Climate Oil 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.
Weaknesses Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change are -
High operating costs
– Compare to the competitors, firm in the HBR case study Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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 Climate Oil 's lucrative customers.
Products dominated business model
– Even though Climate Oil 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 - Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change, in the dynamic environment Climate Oil has struggled to respond to the nimble upstart competition. Climate Oil has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Interest costs
– Compare to the competition, Climate Oil 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 bargaining power of channel partners
– Because of the regulatory requirements, Marc Le Menestrel, Sybille Van den Hove, Henri-Claude De Bettignies suggests that, Climate Oil 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Climate Oil is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Climate Oil needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
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 Climate Oil supply chain. Even after few cautionary changes mentioned in the HBR case study - Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Climate Oil vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Climate Oil, firm in the HBR case study Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Climate Oil 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.
Aligning sales with marketing
– It come across in the case study Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change can leverage the sales team experience to cultivate customer relationships as Climate Oil is planning to shift buying processes online.
Opportunities Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change | 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 Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change are -
Creating value in data economy
– The success of analytics program of Climate Oil has opened avenues for new revenue streams for the organization in the industry. This can help Climate Oil to build a more holistic ecosystem as suggested in the Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change case study. Climate Oil can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Climate Oil in the consumer business. Now Climate Oil can target international markets with far fewer capital restrictions requirements than the existing system.
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 Climate Oil 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.
Loyalty marketing
– Climate Oil 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.
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. Climate Oil can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Climate Oil 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 Climate Oil to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Climate Oil 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Climate Oil can use these opportunities to build new business models that can help the communities that Climate Oil operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Climate Oil can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Climate Oil 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. Climate Oil 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.
Buying journey improvements
– Climate Oil can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Climate Oil 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Climate Oil is facing challenges because of the dominance of functional experts in the organization. Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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.
Threats Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change are -
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.
Consumer confidence and its impact on Climate Oil 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change, Climate Oil 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Climate Oil with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Climate Oil can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Climate Oil is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Climate Oil needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Environmental challenges
– Climate Oil 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. Climate Oil can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Climate Oil 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.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Climate Oil 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.
Regulatory challenges
– Climate Oil 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.
High dependence on third party suppliers
– Climate Oil 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.
Weighted SWOT Analysis of Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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 Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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 Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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 Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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 Should Business Influence the Science and Politics of Global Environmental Change? (A): The Oil Industry and Climate Change 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 Climate Oil needs to make to build a sustainable competitive advantage.
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