Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka)
Icelandic New Energy Co., a research and development consortium based in Reykjavik, Iceland, is considering its future direction. The two-person team has met its first major goal--the installation of the world's first commercial hydrogen filling station and the coordination of a public transport test project involving the operation of three hydrogen-fuelled city buses. The company was founded with the overall objective of investigating the potential for eventually replacing the use of fossil fuels in Iceland with hydrogen-based fuels and creating the first hydrogen society in the world. Working toward the goal of self-sufficiency from fossil fuels, Icelandic New Energy Co. was set up in 1999 by the consortium Vistorka and three major partners, each contributing a part to the testing--Royal Dutch Shell (the refueling station), Norsk Hydro (the electrolysis technology to make the hydrogen), and DaimlerChrysler (fuel cell vehicles using hydrogen fuel). The shareholder agreement, established with the company's start in 1999, is set to expire in 2005. With all of the major activities being outsourced and contracted, the team wondered how it could keep the company as a going concern and contribute to Iceland's transition to a hydrogen economy--a feat that could take more than 15 years.
Authors :: Pratima Bansal, Ken Mark, Jordan Mitchell
Swot Analysis of "Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka)" written by Pratima Bansal, Ken Mark, Jordan Mitchell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hydrogen Icelandic facing as an external strategic factors. Some of the topics covered in Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) case study are - Strategic Management Strategies, Strategic planning and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) casestudy better are - – geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, talent flight as more people leaving formal jobs, increasing energy prices, increasing commodity prices,
challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hydrogen Icelandic, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hydrogen Icelandic 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) can be done for the following purposes –
1. Strategic planning using facts provided in Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) case study
2. Improving business portfolio management of Hydrogen Icelandic
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 Hydrogen Icelandic
Strengths Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hydrogen Icelandic in Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) Harvard Business Review case study are -
Ability to lead change in Strategy & Execution field
– Hydrogen Icelandic 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 Hydrogen Icelandic in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Hydrogen Icelandic is one of the leading recruiters in the industry. Managers in the Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Hydrogen Icelandic has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hydrogen Icelandic 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 brand equity
– Hydrogen Icelandic has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hydrogen Icelandic to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Hydrogen Icelandic is present in almost all the verticals within the industry. This has provided firm in Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Organizational Resilience of Hydrogen Icelandic
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hydrogen Icelandic 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
– Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) firm has clearly differentiated products in the market place. This has enabled Hydrogen Icelandic to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Hydrogen Icelandic to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Hydrogen Icelandic 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) 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 Hydrogen Icelandic in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Hydrogen Icelandic 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Hydrogen Icelandic is one of the most innovative firm in sector. Manager in Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Hydrogen Icelandic 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.
Weaknesses Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) are -
No frontier risks strategy
– After analyzing the HBR case study Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka), it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Increasing silos among functional specialists
– The organizational structure of Hydrogen Icelandic is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Hydrogen Icelandic needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hydrogen Icelandic to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Hydrogen Icelandic, firm in the HBR case study Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka), it seems that the employees of Hydrogen Icelandic 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.
Interest costs
– Compare to the competition, Hydrogen Icelandic 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hydrogen Icelandic is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Skills based hiring
– The stress on hiring functional specialists at Hydrogen Icelandic has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Pratima Bansal, Ken Mark, Jordan Mitchell suggests that, Hydrogen Icelandic 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) 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 Hydrogen Icelandic 's lucrative customers.
Lack of clear differentiation of Hydrogen Icelandic products
– To increase the profitability and margins on the products, Hydrogen Icelandic needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Hydrogen Icelandic 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) | 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) are -
Developing new processes and practices
– Hydrogen Icelandic can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
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. Hydrogen Icelandic can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Hydrogen Icelandic can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hydrogen Icelandic 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, Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Hydrogen Icelandic 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.
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 Hydrogen Icelandic in the consumer business. Now Hydrogen Icelandic can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Hydrogen Icelandic 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hydrogen Icelandic 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hydrogen Icelandic 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 Hydrogen Icelandic to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Hydrogen Icelandic to increase its market reach. Hydrogen Icelandic 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hydrogen Icelandic 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hydrogen Icelandic can use these opportunities to build new business models that can help the communities that Hydrogen Icelandic 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 Hydrogen Icelandic can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hydrogen Icelandic 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) .
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. Hydrogen Icelandic can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hydrogen Icelandic 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.
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. Hydrogen Icelandic needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka), Hydrogen Icelandic 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 .
Regulatory challenges
– Hydrogen Icelandic 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.
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 Hydrogen Icelandic business can come under increasing regulations regarding data privacy, data security, etc.
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. Hydrogen Icelandic 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.
Stagnating economy with rate increase
– Hydrogen Icelandic 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.
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.
Shortening product life cycle
– it is one of the major threat that Hydrogen Icelandic is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Hydrogen Icelandic
– 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 Hydrogen Icelandic.
Environmental challenges
– Hydrogen Icelandic 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. Hydrogen Icelandic can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Weighted SWOT Analysis of Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) 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 Aiming Toward a Hydrogen Economy: Icelandic New Energy Ltd. (Islensk Nyorka) 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 Hydrogen Icelandic needs to make to build a sustainable competitive advantage.