Swot Analysis of "General Electric vs. Westinghouse in Large Turbine Generators (C)" written by Michael E. Porter includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Westinghouse Turbine facing as an external strategic factors. Some of the topics covered in General Electric vs. Westinghouse in Large Turbine Generators (C) case study are - Strategic Management Strategies, Competition, Pricing, Regulation and Strategy & Execution.
Some of the macro environment factors that can be used to understand the General Electric vs. Westinghouse in Large Turbine Generators (C) casestudy better are - – increasing government debt because of Covid-19 spendings, geopolitical disruptions, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels,
competitive advantages are harder to sustain because of technology dispersion, technology disruption, etc
Introduction to SWOT Analysis of General Electric vs. Westinghouse in Large Turbine Generators (C)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in General Electric vs. Westinghouse in Large Turbine Generators (C) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Westinghouse Turbine, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Westinghouse Turbine 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 General Electric vs. Westinghouse in Large Turbine Generators (C) can be done for the following purposes –
1. Strategic planning using facts provided in General Electric vs. Westinghouse in Large Turbine Generators (C) case study
2. Improving business portfolio management of Westinghouse Turbine
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 Westinghouse Turbine
Strengths General Electric vs. Westinghouse in Large Turbine Generators (C) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Westinghouse Turbine in General Electric vs. Westinghouse in Large Turbine Generators (C) Harvard Business Review case study are -
Sustainable margins compare to other players in Strategy & Execution industry
– General Electric vs. Westinghouse in Large Turbine Generators (C) firm has clearly differentiated products in the market place. This has enabled Westinghouse Turbine to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Westinghouse Turbine to invest into research and development (R&D) and innovation.
Organizational Resilience of Westinghouse Turbine
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Westinghouse Turbine does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Westinghouse Turbine is one of the leading recruiters in the industry. Managers in the General Electric vs. Westinghouse in Large Turbine Generators (C) 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
– Westinghouse Turbine has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Westinghouse Turbine 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
– Westinghouse Turbine is present in almost all the verticals within the industry. This has provided firm in General Electric vs. Westinghouse in Large Turbine Generators (C) 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Westinghouse Turbine digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Westinghouse Turbine 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.
Training and development
– Westinghouse Turbine has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in General Electric vs. Westinghouse in Large Turbine Generators (C) 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 Westinghouse Turbine in the sector have low bargaining power. General Electric vs. Westinghouse in Large Turbine Generators (C) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Westinghouse Turbine to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Westinghouse Turbine 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 General Electric vs. Westinghouse in Large Turbine Generators (C) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the General Electric vs. Westinghouse in Large Turbine Generators (C) 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.
Ability to lead change in Strategy & Execution field
– Westinghouse Turbine 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 Westinghouse Turbine in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Westinghouse Turbine 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 Michael E. Porter 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.
Weaknesses General Electric vs. Westinghouse in Large Turbine Generators (C) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of General Electric vs. Westinghouse in Large Turbine Generators (C) are -
Low market penetration in new markets
– Outside its home market of Westinghouse Turbine, firm in the HBR case study General Electric vs. Westinghouse in Large Turbine Generators (C) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Need for greater diversity
– Westinghouse Turbine 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.
Interest costs
– Compare to the competition, Westinghouse Turbine 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Westinghouse Turbine needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the General Electric vs. Westinghouse in Large Turbine Generators (C) 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 Westinghouse Turbine has relatively successful track record of launching new products.
High cash cycle compare to competitors
Westinghouse Turbine 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.
High operating costs
– Compare to the competitors, firm in the HBR case study General Electric vs. Westinghouse in Large Turbine Generators (C) 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 Westinghouse Turbine 's lucrative customers.
Slow to strategic competitive environment developments
– As General Electric vs. Westinghouse in Large Turbine Generators (C) HBR case study mentions - Westinghouse Turbine 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.
Products dominated business model
– Even though Westinghouse Turbine has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - General Electric vs. Westinghouse in Large Turbine Generators (C) should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael E. Porter suggests that, Westinghouse Turbine 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.
Increasing silos among functional specialists
– The organizational structure of Westinghouse Turbine is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Westinghouse Turbine needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Westinghouse Turbine to focus more on services rather than just following the product oriented approach.
Opportunities General Electric vs. Westinghouse in Large Turbine Generators (C) | 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 General Electric vs. Westinghouse in Large Turbine Generators (C) are -
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 Westinghouse Turbine 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.
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. Westinghouse Turbine can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Westinghouse Turbine in the consumer business. Now Westinghouse Turbine can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Westinghouse Turbine 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Westinghouse Turbine 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, General Electric vs. Westinghouse in Large Turbine Generators (C), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Westinghouse Turbine 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. Westinghouse Turbine 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.
Building a culture of innovation
– managers at Westinghouse Turbine 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Westinghouse Turbine 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 Westinghouse Turbine to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Westinghouse Turbine 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.
Buying journey improvements
– Westinghouse Turbine can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. General Electric vs. Westinghouse in Large Turbine Generators (C) 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, Westinghouse Turbine can use these opportunities to build new business models that can help the communities that Westinghouse Turbine operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Using analytics as competitive advantage
– Westinghouse Turbine 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 General Electric vs. Westinghouse in Large Turbine Generators (C) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Westinghouse Turbine to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Westinghouse Turbine to increase its market reach. Westinghouse Turbine 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 General Electric vs. Westinghouse in Large Turbine Generators (C) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study General Electric vs. Westinghouse in Large Turbine Generators (C) are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study General Electric vs. Westinghouse in Large Turbine Generators (C), Westinghouse Turbine 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 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Westinghouse Turbine 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 Westinghouse Turbine 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.
Technology acceleration in Forth Industrial Revolution
– Westinghouse Turbine has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Westinghouse Turbine 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.
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.
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 Westinghouse Turbine.
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 Westinghouse Turbine in the Strategy & Execution sector and impact the bottomline of the organization.
Regulatory challenges
– Westinghouse Turbine 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Westinghouse Turbine with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Westinghouse Turbine
– 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 Westinghouse Turbine.
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. Westinghouse Turbine 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.
Environmental challenges
– Westinghouse Turbine 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. Westinghouse Turbine can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Shortening product life cycle
– it is one of the major threat that Westinghouse Turbine is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of General Electric vs. Westinghouse in Large Turbine Generators (C) 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 General Electric vs. Westinghouse in Large Turbine Generators (C) 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 General Electric vs. Westinghouse in Large Turbine Generators (C) 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 General Electric vs. Westinghouse in Large Turbine Generators (C) 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 General Electric vs. Westinghouse in Large Turbine Generators (C) 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 Westinghouse Turbine needs to make to build a sustainable competitive advantage.