The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
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Case Study SWOT Analysis Solution
Case Study Description of The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience
This article proposes a framework to address a central conundrum in strategic management: How can firms transcend the trade-off between the momentum that results from the strong strategic commitments needed to gain industry leadership with the need for strategic agility in the face of strategic discontinuities? The article develops an analysis of the meta-capabilities underlying strategic agility, which is clustered around strategic sensitivity (both the sharpness of perception and the intensity of awareness and attention), resource fluidity (the internal capability to reconfigure business systems and redeploy resources rapidly), and leadership unity (the ability of the top team to make bold decisions fast, without getting bogged down in "win-lose" politics at the top). Based on an in-depth study of Nokia's evolution over the past twenty years, this article shows how these three meta-capabilities interact over time and proposes a framework to enable a firm to maintain and regain strategic agility as it matures.
Swot Analysis of "The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience" written by Yves L. Doz, Mikko Kosonen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Agility Strategic facing as an external strategic factors. Some of the topics covered in The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience case study are - Strategic Management Strategies, Strategy execution and Strategy & Execution.
Some of the macro environment factors that can be used to understand the The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience casestudy better are - – talent flight as more people leaving formal jobs, increasing household debt because of falling income levels, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models,
wage bills are increasing, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Agility Strategic, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Agility Strategic 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience can be done for the following purposes –
1. Strategic planning using facts provided in The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience case study
2. Improving business portfolio management of Agility Strategic
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 Agility Strategic
Strengths The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Agility Strategic in The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience Harvard Business Review case study are -
Organizational Resilience of Agility Strategic
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Agility Strategic does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Agility Strategic 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
– Agility Strategic has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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.
Cross disciplinary teams
– Horizontal connected teams at the Agility Strategic 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.
Operational resilience
– The operational resilience strategy in the The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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
– Agility Strategic 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 Agility Strategic in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Strategy & Execution industry
– The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience firm has clearly differentiated products in the market place. This has enabled Agility Strategic to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Agility Strategic to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Agility Strategic is present in almost all the verticals within the industry. This has provided firm in The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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.
Innovation driven organization
– Agility Strategic is one of the most innovative firm in sector. Manager in The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Agility Strategic digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Agility Strategic 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.
Strong track record of project management
– Agility Strategic is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Agility Strategic in the sector have low bargaining power. The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Agility Strategic to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience are -
Aligning sales with marketing
– It come across in the case study The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience can leverage the sales team experience to cultivate customer relationships as Agility Strategic is planning to shift buying processes online.
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 Agility Strategic supply chain. Even after few cautionary changes mentioned in the HBR case study - The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Agility Strategic vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Agility Strategic is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Agility Strategic needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Agility Strategic to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Agility Strategic 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.
Interest costs
– Compare to the competition, Agility Strategic 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, Agility Strategic 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.
Low market penetration in new markets
– Outside its home market of Agility Strategic, firm in the HBR case study The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to strategic competitive environment developments
– As The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience HBR case study mentions - Agility Strategic 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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 Agility Strategic has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Agility Strategic 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. Agility Strategic 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 operating costs
– Compare to the competitors, firm in the HBR case study The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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 Agility Strategic 's lucrative customers.
Opportunities The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience | 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience are -
Learning at scale
– Online learning technologies has now opened space for Agility Strategic 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.
Building a culture of innovation
– managers at Agility Strategic 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.
Using analytics as competitive advantage
– Agility Strategic 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Agility Strategic to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Agility Strategic 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.
Buying journey improvements
– Agility Strategic can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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.
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 Agility Strategic in the consumer business. Now Agility Strategic can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Agility Strategic 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.
Better consumer reach
– The expansion of the 5G network will help Agility Strategic to increase its market reach. Agility Strategic 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.
Creating value in data economy
– The success of analytics program of Agility Strategic has opened avenues for new revenue streams for the organization in the industry. This can help Agility Strategic to build a more holistic ecosystem as suggested in the The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience case study. Agility Strategic can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Agility Strategic 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Agility Strategic 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, The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Agility Strategic 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 Agility Strategic 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, Agility Strategic 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.
Threats The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience are -
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 Agility Strategic business can come under increasing regulations regarding data privacy, data security, etc.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Agility Strategic 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience .
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. Agility Strategic can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Agility Strategic needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Consumer confidence and its impact on Agility Strategic 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.
High dependence on third party suppliers
– Agility Strategic 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.
Regulatory challenges
– Agility Strategic 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.
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 Agility Strategic in the Strategy & Execution sector and impact the bottomline of the organization.
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. Agility Strategic 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.
Shortening product life cycle
– it is one of the major threat that Agility Strategic is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Agility Strategic 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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 The Dynamics of Strategic Agility: Nokia's Rollercoaster Experience 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 Agility Strategic needs to make to build a sustainable competitive advantage.