MacTara Limited and the Wood Products Industry in Nova Scotia SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of MacTara Limited and the Wood Products Industry in Nova Scotia
The case centers around the strategic planning retreat of MacTara Limited (MacTara), the largest wood products company in Nova Scotia. While there are some very good opportunities for the company in some sectors, like wood pellets for fuel (high demand for inexpensively priced renewable energy sources), the Canadian lumber industry as a whole is not attractive at this time (distortionary effects of the Canadian-U.S. softwood lumber dispute, low price of lumber, sales denominated in the free-falling U.S. dollar, inflexible cost structure, etc). The fact that MacTara is a somewhat vertically integrated company - from construction lumber, to chips for paper mills, to fuel pellets made out of wood waste - makes planning very difficult because the health of each sector impacts on the prospects for the others. Company executives need to find a way to make all the various pieces of the business fit together into a profitable whole while they still have money and time. The Canadian lumber industry is in crisis and the eastern Canadian industry is ripe for consolidation.
Swot Analysis of "MacTara Limited and the Wood Products Industry in Nova Scotia" written by Julia Sagebien, Rick Shaver includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mactara Lumber facing as an external strategic factors. Some of the topics covered in MacTara Limited and the Wood Products Industry in Nova Scotia case study are - Strategic Management Strategies, Policy, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the MacTara Limited and the Wood Products Industry in Nova Scotia casestudy better are - – central banks are concerned over increasing inflation, there is increasing trade war between United States & China, wage bills are increasing, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic ,
increasing government debt because of Covid-19 spendings, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of MacTara Limited and the Wood Products Industry in Nova Scotia
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MacTara Limited and the Wood Products Industry in Nova Scotia case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mactara Lumber, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mactara Lumber 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 MacTara Limited and the Wood Products Industry in Nova Scotia can be done for the following purposes –
1. Strategic planning using facts provided in MacTara Limited and the Wood Products Industry in Nova Scotia case study
2. Improving business portfolio management of Mactara Lumber
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 Mactara Lumber
Strengths MacTara Limited and the Wood Products Industry in Nova Scotia | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mactara Lumber in MacTara Limited and the Wood Products Industry in Nova Scotia Harvard Business Review case study are -
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Mactara Lumber digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mactara Lumber 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.
Effective Research and Development (R&D)
– Mactara Lumber 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 MacTara Limited and the Wood Products Industry in Nova Scotia - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Mactara Lumber is one of the leading recruiters in the industry. Managers in the MacTara Limited and the Wood Products Industry in Nova Scotia 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
– Mactara Lumber has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mactara Lumber to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Mactara Lumber 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.
Innovation driven organization
– Mactara Lumber is one of the most innovative firm in sector. Manager in MacTara Limited and the Wood Products Industry in Nova Scotia Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Mactara Lumber 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 Julia Sagebien, Rick Shaver 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.
Organizational Resilience of Mactara Lumber
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Mactara Lumber does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Mactara Lumber is present in almost all the verticals within the industry. This has provided firm in MacTara Limited and the Wood Products Industry in Nova Scotia 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.
Low bargaining power of suppliers
– Suppliers of Mactara Lumber in the sector have low bargaining power. MacTara Limited and the Wood Products Industry in Nova Scotia has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mactara Lumber to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Mactara Lumber has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Mactara Lumber has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High switching costs
– The high switching costs that Mactara Lumber 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 MacTara Limited and the Wood Products Industry in Nova Scotia | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MacTara Limited and the Wood Products Industry in Nova Scotia are -
High operating costs
– Compare to the competitors, firm in the HBR case study MacTara Limited and the Wood Products Industry in Nova Scotia 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 Mactara Lumber 's lucrative customers.
High cash cycle compare to competitors
Mactara Lumber 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study MacTara Limited and the Wood Products Industry in Nova Scotia, in the dynamic environment Mactara Lumber has struggled to respond to the nimble upstart competition. Mactara Lumber has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the MacTara Limited and the Wood Products Industry in Nova Scotia 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 Mactara Lumber has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Mactara Lumber 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.
Slow to strategic competitive environment developments
– As MacTara Limited and the Wood Products Industry in Nova Scotia HBR case study mentions - Mactara Lumber takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Need for greater diversity
– Mactara Lumber 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Julia Sagebien, Rick Shaver suggests that, Mactara Lumber 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study MacTara Limited and the Wood Products Industry in Nova Scotia, is just above the industry average. Mactara Lumber needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mactara Lumber is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study MacTara Limited and the Wood Products Industry in Nova Scotia 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 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 Mactara Lumber supply chain. Even after few cautionary changes mentioned in the HBR case study - MacTara Limited and the Wood Products Industry in Nova Scotia, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Mactara Lumber vulnerable to further global disruptions in South East Asia.
Opportunities MacTara Limited and the Wood Products Industry in Nova Scotia | 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 MacTara Limited and the Wood Products Industry in Nova Scotia are -
Creating value in data economy
– The success of analytics program of Mactara Lumber has opened avenues for new revenue streams for the organization in the industry. This can help Mactara Lumber to build a more holistic ecosystem as suggested in the MacTara Limited and the Wood Products Industry in Nova Scotia case study. Mactara Lumber can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Mactara Lumber can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. MacTara Limited and the Wood Products Industry in Nova Scotia 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.
Manufacturing automation
– Mactara Lumber 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 Mactara Lumber 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.
Developing new processes and practices
– Mactara Lumber 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mactara Lumber 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.
Better consumer reach
– The expansion of the 5G network will help Mactara Lumber to increase its market reach. Mactara Lumber 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mactara Lumber can use these opportunities to build new business models that can help the communities that Mactara Lumber operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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. Mactara Lumber 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. Mactara Lumber 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.
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 Mactara Lumber in the consumer business. Now Mactara Lumber can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Mactara Lumber 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.
Learning at scale
– Online learning technologies has now opened space for Mactara Lumber 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.
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. Mactara Lumber can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats MacTara Limited and the Wood Products Industry in Nova Scotia External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MacTara Limited and the Wood Products Industry in Nova Scotia are -
Stagnating economy with rate increase
– Mactara Lumber 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study MacTara Limited and the Wood Products Industry in Nova Scotia, Mactara Lumber 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 .
Technology acceleration in Forth Industrial Revolution
– Mactara Lumber has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Mactara Lumber 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mactara Lumber 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.
Consumer confidence and its impact on Mactara Lumber 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 Mactara Lumber
– 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 Mactara Lumber.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mactara Lumber 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 MacTara Limited and the Wood Products Industry in Nova Scotia .
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. Mactara Lumber can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Mactara Lumber 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.
Regulatory challenges
– Mactara Lumber 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.
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 Mactara Lumber.
High dependence on third party suppliers
– Mactara Lumber 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 MacTara Limited and the Wood Products Industry in Nova Scotia 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 MacTara Limited and the Wood Products Industry in Nova Scotia 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 MacTara Limited and the Wood Products Industry in Nova Scotia 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 MacTara Limited and the Wood Products Industry in Nova Scotia 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 MacTara Limited and the Wood Products Industry in Nova Scotia 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 Mactara Lumber needs to make to build a sustainable competitive advantage.
