DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
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Case Study SWOT Analysis Solution
Case Study Description of DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber
Confidential Instructions for Riverside Lumber for product #PON183.Two-party, multi-issue, scoreable negotiation between a manufacturer and a state environmental agency to reach a settlement over the manufacturer's pollution of a local river. Riverside Lumber is a pulp manufacturer in a small town in the Pacific Northwest. Riverside regularly dumps effluent into a nearby river. The Division of Environmental Conservation (DEC) claims that the effluent is toxic and jeopardizes the local salmon catch. Relations between the two parties have deteriorated. DEC has filed suit against Riverside in an attempt to close the plant. The trial date is three days away, and the parties are meeting to see if a last minute settlement is possible. Several issues will surface in the negotiation: Should Riverside be forced to purchase a special scrubber to neutralize the toxic effects of its effluent? Should Riverside be forced to close temporarily or permanently? Can DEC provide Riverside financial incentives to encourage cooperation? This is a role play case.
Authors :: David A. Lax, James K. Sebenius, Lawrence Susskind
Swot Analysis of "DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber" written by David A. Lax, James K. Sebenius, Lawrence Susskind includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Riverside Dec facing as an external strategic factors. Some of the topics covered in DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber case study are - Strategic Management Strategies, Negotiations, Sustainability and Strategy & Execution.
Some of the macro environment factors that can be used to understand the DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber casestudy better are - – challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, technology disruption,
increasing commodity prices, geopolitical disruptions, etc
Introduction to SWOT Analysis of DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Riverside Dec, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Riverside Dec 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber can be done for the following purposes –
1. Strategic planning using facts provided in DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber case study
2. Improving business portfolio management of Riverside Dec
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 Riverside Dec
Strengths DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Riverside Dec in DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber Harvard Business Review case study are -
Successful track record of launching new products
– Riverside Dec has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Riverside Dec 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.
Diverse revenue streams
– Riverside Dec is present in almost all the verticals within the industry. This has provided firm in DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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.
Effective Research and Development (R&D)
– Riverside Dec 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Riverside Dec
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Riverside Dec does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Strategy & Execution field
– Riverside Dec 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 Riverside Dec in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Riverside Dec has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Riverside Dec to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Riverside Dec is one of the leading recruiters in the industry. Managers in the DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Riverside Dec in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Riverside Dec is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Riverside Dec digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Riverside Dec 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.
Low bargaining power of suppliers
– Suppliers of Riverside Dec in the sector have low bargaining power. DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Riverside Dec to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber are -
Low market penetration in new markets
– Outside its home market of Riverside Dec, firm in the HBR case study DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber, in the dynamic environment Riverside Dec has struggled to respond to the nimble upstart competition. Riverside Dec has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Riverside Dec products
– To increase the profitability and margins on the products, Riverside Dec needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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 Riverside Dec has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Riverside Dec 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.
Need for greater diversity
– Riverside Dec 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.
Increasing silos among functional specialists
– The organizational structure of Riverside Dec is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Riverside Dec needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Riverside Dec to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber HBR case study mentions - Riverside Dec 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.
Aligning sales with marketing
– It come across in the case study DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber can leverage the sales team experience to cultivate customer relationships as Riverside Dec is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, David A. Lax, James K. Sebenius, Lawrence Susskind suggests that, Riverside Dec 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, Riverside Dec is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber | 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber are -
Loyalty marketing
– Riverside Dec 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.
Learning at scale
– Online learning technologies has now opened space for Riverside Dec 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.
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 Riverside Dec 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.
Building a culture of innovation
– managers at Riverside Dec 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.
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. Riverside Dec can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Riverside Dec is facing challenges because of the dominance of functional experts in the organization. DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Riverside Dec can use these opportunities to build new business models that can help the communities that Riverside Dec operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Riverside Dec 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, DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Riverside Dec 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.
Leveraging digital technologies
– Riverside Dec 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.
Developing new processes and practices
– Riverside Dec 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.
Creating value in data economy
– The success of analytics program of Riverside Dec has opened avenues for new revenue streams for the organization in the industry. This can help Riverside Dec to build a more holistic ecosystem as suggested in the DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber case study. Riverside Dec can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Riverside Dec 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.
Threats DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber are -
Regulatory challenges
– Riverside Dec 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.
Stagnating economy with rate increase
– Riverside Dec 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.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Riverside Dec in the Strategy & Execution sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Riverside Dec 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. Riverside Dec needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Riverside Dec 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber, Riverside Dec 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 .
Environmental challenges
– Riverside Dec 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. Riverside Dec can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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.
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 Riverside Dec business can come under increasing regulations regarding data privacy, data security, etc.
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. Riverside Dec can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Riverside Dec 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 Riverside Dec
– 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 Riverside Dec.
Weighted SWOT Analysis of DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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 DEC V. RIVERSIDE - Confidential Instructions for Riverside Lumber 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 Riverside Dec needs to make to build a sustainable competitive advantage.
