MDCM, Inc. (B): Strategic IT Portfolio Management SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of MDCM, Inc. (B): Strategic IT Portfolio Management
"MDCM, Inc. (B): Strategic IT Portfolio Management" examines the steps involved in developing a portfolio of IT projects aligned with a company's strategic objectives. Specifically, the case describes a situation where a firm has launched a transformation strategy but has yet to develop a complementary IT strategy. Students must select the optimal portfolio of projects aligned with the strategic objectives and define the global project execution strategy. The projects have both risks and dependencies. U.S.-based MDCM, Inc. specializes in medical device contract manufacturing and assembly. For the past five years, MDCM had grown by making more than twenty acquisitions of companies based outside the United States. This growth strategy enabled MDCM to better match its services to its customers, who had become larger and more global. In MDCM (A), the CIO of MDCM needed to determine the company's IT strategy and objectives. In doing so, he needed to ensure that they were properly aligned with the company's overall strategy and the new organization developed under an initiative called Horizon 2000. In a lecture prior to the cases, students should be introduced to the framework of IT portfolio management and how it can help focus IT efforts. In MDCM (B), the CIO has performed an audit of MDCM's IT and found twelve projects that are potential investment candidates for the next three years. The challenge for the IT Portfolio Management team is to identify the priority and appropriate sequence of investments to be made. The case assumes that students have knowledge of corporate IT. More specifically, the case is targeted for those who are or plan to become executives who would manage IT strategy and IT investment decisions either directly or in an oversight role. This case is the second in a series; the first is the case "MDCM, Inc. (A): IT Strategy Synchronization."
Authors :: Mark Jeffery, Joseph F. Norton, Derek Yung
Swot Analysis of "MDCM, Inc. (B): Strategic IT Portfolio Management" written by Mark Jeffery, Joseph F. Norton, Derek Yung includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mdcm Portfolio facing as an external strategic factors. Some of the topics covered in MDCM, Inc. (B): Strategic IT Portfolio Management case study are - Strategic Management Strategies, IT, Operations management, Performance measurement, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the MDCM, Inc. (B): Strategic IT Portfolio Management casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings,
banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of MDCM, Inc. (B): Strategic IT Portfolio Management
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MDCM, Inc. (B): Strategic IT Portfolio Management case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mdcm Portfolio, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management can be done for the following purposes –
1. Strategic planning using facts provided in MDCM, Inc. (B): Strategic IT Portfolio Management case study
2. Improving business portfolio management of Mdcm Portfolio
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 Mdcm Portfolio
Strengths MDCM, Inc. (B): Strategic IT Portfolio Management | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mdcm Portfolio in MDCM, Inc. (B): Strategic IT Portfolio Management Harvard Business Review case study are -
High brand equity
– Mdcm Portfolio has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mdcm Portfolio to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Mdcm Portfolio is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Mdcm Portfolio
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Mdcm Portfolio does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Mdcm Portfolio in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Strategy & Execution industry
– MDCM, Inc. (B): Strategic IT Portfolio Management firm has clearly differentiated products in the market place. This has enabled Mdcm Portfolio to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Mdcm Portfolio to invest into research and development (R&D) and innovation.
Analytics focus
– Mdcm Portfolio 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 Mark Jeffery, Joseph F. Norton, Derek Yung 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.
High switching costs
– The high switching costs that Mdcm Portfolio 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.
Training and development
– Mdcm Portfolio has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in MDCM, Inc. (B): Strategic IT Portfolio Management 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 Mdcm Portfolio in the sector have low bargaining power. MDCM, Inc. (B): Strategic IT Portfolio Management has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Mdcm Portfolio to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the MDCM, Inc. (B): Strategic IT Portfolio Management 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
– Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Mdcm Portfolio is one of the leading recruiters in the industry. Managers in the MDCM, Inc. (B): Strategic IT Portfolio Management are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses MDCM, Inc. (B): Strategic IT Portfolio Management | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MDCM, Inc. (B): Strategic IT Portfolio Management are -
Aligning sales with marketing
– It come across in the case study MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management can leverage the sales team experience to cultivate customer relationships as Mdcm Portfolio is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Mdcm Portfolio has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Mdcm Portfolio even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High bargaining power of channel partners
– Because of the regulatory requirements, Mark Jeffery, Joseph F. Norton, Derek Yung suggests that, Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management, is just above the industry average. Mdcm Portfolio 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.
High operating costs
– Compare to the competitors, firm in the HBR case study MDCM, Inc. (B): Strategic IT Portfolio Management 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 Mdcm Portfolio 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mdcm Portfolio is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study MDCM, Inc. (B): Strategic IT Portfolio Management can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Mdcm Portfolio 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 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 Mdcm Portfolio supply chain. Even after few cautionary changes mentioned in the HBR case study - MDCM, Inc. (B): Strategic IT Portfolio Management, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Mdcm Portfolio vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Mdcm Portfolio 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 - MDCM, Inc. (B): Strategic IT Portfolio Management should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study MDCM, Inc. (B): Strategic IT Portfolio Management, in the dynamic environment Mdcm Portfolio has struggled to respond to the nimble upstart competition. Mdcm Portfolio has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study MDCM, Inc. (B): Strategic IT Portfolio Management, it seems that the employees of Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management | 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 MDCM, Inc. (B): Strategic IT Portfolio Management are -
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. Mdcm Portfolio 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. Mdcm Portfolio 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.
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. Mdcm Portfolio can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Mdcm Portfolio to increase its market reach. Mdcm Portfolio 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mdcm Portfolio 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mdcm Portfolio can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Mdcm Portfolio 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.
Leveraging digital technologies
– Mdcm Portfolio 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.
Learning at scale
– Online learning technologies has now opened space for Mdcm Portfolio 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.
Developing new processes and practices
– Mdcm Portfolio 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.
Using analytics as competitive advantage
– Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mdcm Portfolio to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mdcm Portfolio 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.
Building a culture of innovation
– managers at Mdcm Portfolio 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.
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 Mdcm Portfolio in the consumer business. Now Mdcm Portfolio can target international markets with far fewer capital restrictions requirements than the existing system.
Threats MDCM, Inc. (B): Strategic IT Portfolio Management External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MDCM, Inc. (B): Strategic IT Portfolio Management are -
Regulatory challenges
– Mdcm Portfolio 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.
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.
Technology acceleration in Forth Industrial Revolution
– Mdcm Portfolio has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Mdcm Portfolio 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.
Shortening product life cycle
– it is one of the major threat that Mdcm Portfolio is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Mdcm Portfolio 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.
Consumer confidence and its impact on Mdcm Portfolio 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study MDCM, Inc. (B): Strategic IT Portfolio Management, Mdcm Portfolio 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 .
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 Mdcm Portfolio.
Increasing wage structure of Mdcm Portfolio
– 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 Mdcm Portfolio.
Stagnating economy with rate increase
– Mdcm Portfolio 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 Mdcm Portfolio in the Strategy & Execution sector and impact the bottomline of the organization.
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. Mdcm Portfolio can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Mdcm Portfolio with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 Mdcm Portfolio needs to make to build a sustainable competitive advantage.