Wheels Group: Evolution of a Third-Party Logistics Service Provider SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Wheels Group: Evolution of a Third-Party Logistics Service Provider
The president of Wheels Group and the founder and major shareholder of the company are evaluating alternatives for doubling the company's revenues over the next five years. They must decide between two competing growth strategies: an asset-based growth strategy and a nonasset-based growth one. Complicating the decision is the fact that approximately 75% of the company's revenues are currently derived from nonasset-based activity. Students can explore issues associated with developing, evaluating, and implementing business strategy within the third-party logistics industry.
Swot Analysis of "Wheels Group: Evolution of a Third-Party Logistics Service Provider" written by P. Fraser Johnson, Michael Sartor includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nonasset Wheels facing as an external strategic factors. Some of the topics covered in Wheels Group: Evolution of a Third-Party Logistics Service Provider case study are - Strategic Management Strategies, Supply chain and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Wheels Group: Evolution of a Third-Party Logistics Service Provider casestudy better are - – challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , increasing commodity prices, geopolitical disruptions,
there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Wheels Group: Evolution of a Third-Party Logistics Service Provider
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Wheels Group: Evolution of a Third-Party Logistics Service Provider case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nonasset Wheels, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nonasset Wheels 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider can be done for the following purposes –
1. Strategic planning using facts provided in Wheels Group: Evolution of a Third-Party Logistics Service Provider case study
2. Improving business portfolio management of Nonasset Wheels
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 Nonasset Wheels
Strengths Wheels Group: Evolution of a Third-Party Logistics Service Provider | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nonasset Wheels in Wheels Group: Evolution of a Third-Party Logistics Service Provider Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Nonasset Wheels 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.
Diverse revenue streams
– Nonasset Wheels is present in almost all the verticals within the industry. This has provided firm in Wheels Group: Evolution of a Third-Party Logistics Service Provider 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.
Successful track record of launching new products
– Nonasset Wheels has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nonasset Wheels 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.
Highly skilled collaborators
– Nonasset Wheels 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Nonasset Wheels is one of the leading recruiters in the industry. Managers in the Wheels Group: Evolution of a Third-Party Logistics Service Provider are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Nonasset Wheels digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Nonasset Wheels 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.
Effective Research and Development (R&D)
– Nonasset Wheels 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Nonasset Wheels is one of the most innovative firm in sector. Manager in Wheels Group: Evolution of a Third-Party Logistics Service Provider Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Nonasset Wheels
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Nonasset Wheels does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Nonasset Wheels is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Strategy & Execution field
– Nonasset Wheels 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 Nonasset Wheels in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Nonasset Wheels is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Nonasset Wheels is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Wheels Group: Evolution of a Third-Party Logistics Service Provider Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Wheels Group: Evolution of a Third-Party Logistics Service Provider | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Wheels Group: Evolution of a Third-Party Logistics Service Provider are -
Slow to strategic competitive environment developments
– As Wheels Group: Evolution of a Third-Party Logistics Service Provider HBR case study mentions - Nonasset Wheels 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.
Slow decision making process
– As mentioned earlier in the report, Nonasset Wheels 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. Nonasset Wheels 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, P. Fraser Johnson, Michael Sartor suggests that, Nonasset Wheels 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.
Interest costs
– Compare to the competition, Nonasset Wheels 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nonasset Wheels is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Wheels Group: Evolution of a Third-Party Logistics Service Provider can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Nonasset Wheels 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.
Increasing silos among functional specialists
– The organizational structure of Nonasset Wheels is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Nonasset Wheels needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Nonasset Wheels to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Nonasset Wheels 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Wheels Group: Evolution of a Third-Party Logistics Service Provider, is just above the industry average. Nonasset Wheels 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.
Low market penetration in new markets
– Outside its home market of Nonasset Wheels, firm in the HBR case study Wheels Group: Evolution of a Third-Party Logistics Service Provider needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Nonasset Wheels supply chain. Even after few cautionary changes mentioned in the HBR case study - Wheels Group: Evolution of a Third-Party Logistics Service Provider, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Nonasset Wheels vulnerable to further global disruptions in South East Asia.
Opportunities Wheels Group: Evolution of a Third-Party Logistics Service Provider | 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Nonasset Wheels 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.
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 Nonasset Wheels in the consumer business. Now Nonasset Wheels can target international markets with far fewer capital restrictions requirements than the existing system.
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. Nonasset Wheels 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. Nonasset Wheels 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.
Creating value in data economy
– The success of analytics program of Nonasset Wheels has opened avenues for new revenue streams for the organization in the industry. This can help Nonasset Wheels to build a more holistic ecosystem as suggested in the Wheels Group: Evolution of a Third-Party Logistics Service Provider case study. Nonasset Wheels can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Nonasset Wheels 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.
Buying journey improvements
– Nonasset Wheels can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Wheels Group: Evolution of a Third-Party Logistics Service Provider 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nonasset Wheels is facing challenges because of the dominance of functional experts in the organization. Wheels Group: Evolution of a Third-Party Logistics Service Provider 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.
Leveraging digital technologies
– Nonasset Wheels 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.
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 Nonasset Wheels 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Nonasset Wheels 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.
Learning at scale
– Online learning technologies has now opened space for Nonasset Wheels 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, Nonasset Wheels 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, Wheels Group: Evolution of a Third-Party Logistics Service Provider, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Nonasset Wheels 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nonasset Wheels to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Wheels Group: Evolution of a Third-Party Logistics Service Provider External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Wheels Group: Evolution of a Third-Party Logistics Service Provider are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Nonasset Wheels 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider .
Environmental challenges
– Nonasset Wheels 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. Nonasset Wheels 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Wheels Group: Evolution of a Third-Party Logistics Service Provider, Nonasset Wheels 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 Nonasset Wheels 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.
Regulatory challenges
– Nonasset Wheels 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.
Increasing wage structure of Nonasset Wheels
– 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 Nonasset Wheels.
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 Nonasset Wheels in the Strategy & Execution sector and impact the bottomline of the organization.
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 Nonasset Wheels.
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.
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. Nonasset Wheels 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. Nonasset Wheels needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Nonasset Wheels 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider 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 Wheels Group: Evolution of a Third-Party Logistics Service Provider 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 Nonasset Wheels needs to make to build a sustainable competitive advantage.
