Agile Electric: Quality Issues in a Global Supply Chain SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Agile Electric: Quality Issues in a Global Supply Chain
The case describes issues related to supply chain quality and how they evolve in the context of a multi-tiered global supply chain. The case involves a global multi-tier automotive supply chain made up of one of the world's largest automotive original equipment manufacturers (OEMs), its tier 1 supplier that is also a U.S.-based global corporation and the tier 2, tier 3 and tier 4 suppliers based in India. With Automek's engineering support, Agile had developed many parts successfully for the OEM in the past. Based on this experience with the company, Automek buyers placed an order with Agile for a new product (an actuator assembly). In developing this product with little support from Automek, Agile was concerned due to its lack of knowledge concerning the suppliers for the actuator assembly components and the critical requirements. To allay its concerns, Automek promised to support Agile by (a) locating the critical global suppliers for specialized components and (b) assessing and validating the critical suppliers based in India on behalf of Agile. Agile then invested in the assembly line and developed the actuator assembly. When supplies started, the OEM reported many quality problems that were traced to the tiered suppliers. Along with the quality and part supply issues, the issues of subsequent liability in the case of a recall by the OEM were faced by the members of the supply chain. Agile felt that since Automek had selected or approved the suppliers, and also as Agile had no knowledge of the product, that Automek should take the responsibility of resolving the quality problems arising from the supplier base. To complicate matters, some of the tiered supply chain members were not willing to invest time and effort in implementing improved manufacturing and process control practices as desired by Automek.
Swot Analysis of "Agile Electric: Quality Issues in a Global Supply Chain" written by Dhruv Dar, Sanjay Kumar, Vijay Aggarwal includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Automek Agile facing as an external strategic factors. Some of the topics covered in Agile Electric: Quality Issues in a Global Supply Chain case study are - Strategic Management Strategies, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Agile Electric: Quality Issues in a Global Supply Chain casestudy better are - – increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, technology disruption, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic ,
geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Agile Electric: Quality Issues in a Global Supply Chain
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Agile Electric: Quality Issues in a Global Supply Chain case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Automek Agile, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Automek Agile 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 Agile Electric: Quality Issues in a Global Supply Chain can be done for the following purposes –
1. Strategic planning using facts provided in Agile Electric: Quality Issues in a Global Supply Chain case study
2. Improving business portfolio management of Automek Agile
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 Automek Agile
Strengths Agile Electric: Quality Issues in a Global Supply Chain | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Automek Agile in Agile Electric: Quality Issues in a Global Supply Chain Harvard Business Review case study are -
Analytics focus
– Automek Agile 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 Dhruv Dar, Sanjay Kumar, Vijay Aggarwal 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.
Strong track record of project management
– Automek Agile 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 switching costs
– The high switching costs that Automek Agile 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
- Automek Agile 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 Automek Agile is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Agile Electric: Quality Issues in a Global Supply Chain Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Automek Agile has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Automek Agile 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.
Superior customer experience
– The customer experience strategy of Automek Agile in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Automek Agile 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.
Effective Research and Development (R&D)
– Automek Agile 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 Agile Electric: Quality Issues in a Global Supply Chain - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Automek Agile has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Agile Electric: Quality Issues in a Global Supply Chain Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Low bargaining power of suppliers
– Suppliers of Automek Agile in the sector have low bargaining power. Agile Electric: Quality Issues in a Global Supply Chain has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Automek Agile to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Agile Electric: Quality Issues in a Global Supply Chain 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.
Highly skilled collaborators
– Automek Agile 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 Agile Electric: Quality Issues in a Global Supply Chain HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Agile Electric: Quality Issues in a Global Supply Chain | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Agile Electric: Quality Issues in a Global Supply Chain are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Agile Electric: Quality Issues in a Global Supply Chain 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 Automek Agile has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Agile Electric: Quality Issues in a Global Supply Chain 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 Automek Agile 's lucrative customers.
High cash cycle compare to competitors
Automek Agile 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 Agile Electric: Quality Issues in a Global Supply Chain, in the dynamic environment Automek Agile has struggled to respond to the nimble upstart competition. Automek Agile has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Automek Agile 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.
Increasing silos among functional specialists
– The organizational structure of Automek Agile is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Automek Agile needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Automek Agile to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Dhruv Dar, Sanjay Kumar, Vijay Aggarwal suggests that, Automek Agile 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 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 Automek Agile supply chain. Even after few cautionary changes mentioned in the HBR case study - Agile Electric: Quality Issues in a Global Supply Chain, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Automek Agile vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Automek Agile 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.
Low market penetration in new markets
– Outside its home market of Automek Agile, firm in the HBR case study Agile Electric: Quality Issues in a Global Supply Chain 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 Agile Electric: Quality Issues in a Global Supply Chain, it seems that the employees of Automek Agile 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.
Opportunities Agile Electric: Quality Issues in a Global Supply Chain | 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 Agile Electric: Quality Issues in a Global Supply Chain are -
Building a culture of innovation
– managers at Automek Agile 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Automek Agile 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, Agile Electric: Quality Issues in a Global Supply Chain, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Automek Agile can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Automek Agile can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Automek Agile can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Agile Electric: Quality Issues in a Global Supply Chain 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Automek Agile can use these opportunities to build new business models that can help the communities that Automek Agile operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Automek Agile 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.
Using analytics as competitive advantage
– Automek Agile has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Agile Electric: Quality Issues in a Global Supply Chain - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Automek Agile to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Automek Agile in the consumer business. Now Automek Agile can target international markets with far fewer capital restrictions requirements than the existing system.
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. Automek Agile can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Automek Agile 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. Automek Agile 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Automek Agile 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 Automek Agile to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Automek Agile to increase its market reach. Automek Agile 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.
Threats Agile Electric: Quality Issues in a Global Supply Chain External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Agile Electric: Quality Issues in a Global Supply Chain are -
Regulatory challenges
– Automek Agile 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.
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.
Technology acceleration in Forth Industrial Revolution
– Automek Agile has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Automek Agile 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.
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. Automek Agile 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Automek Agile with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Automek Agile 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.
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 Automek Agile business can come under increasing regulations regarding data privacy, data security, 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. Automek Agile needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Automek Agile 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Agile Electric: Quality Issues in a Global Supply Chain, Automek Agile 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 .
Stagnating economy with rate increase
– Automek Agile 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Automek Agile 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 Agile Electric: Quality Issues in a Global Supply Chain .
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.
Weighted SWOT Analysis of Agile Electric: Quality Issues in a Global Supply Chain 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 Agile Electric: Quality Issues in a Global Supply Chain 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 Agile Electric: Quality Issues in a Global Supply Chain 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 Agile Electric: Quality Issues in a Global Supply Chain 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 Agile Electric: Quality Issues in a Global Supply Chain 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 Automek Agile needs to make to build a sustainable competitive advantage.