Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management
Established in 1938, Highly Confident Transportation ("HCT") is a leading third-party logistics ("3PL") company in Taiwan. Originally a trucking and en-route transportation company serving domestic customers, HCT has transformed into a company providing integrated logistics services to global customers. Throughout its history, the company has prospered despite fierce competition, economic hard times and a rapidly changing market environment. HCT now competes against both domestic and foreign players. Despite these challenges, Chen Rong-chuan, chief operating officer of HCT, sees immense opportunities in the trend since the 1990s of outsourcing logistics functions to professional logistics companies such as HCT. In order to increase profits for the company, he has pushed for innovation and a service-oriented approach to be the future directions for HCT and has implemented a complete cultural change throughout the company. He has stressed the vital role of information technology throughout HCT's development into a leading 3PL company that offers logistics solutions both within Taiwan and around the world. This case can be used as a teaching tool for logistics or supply chain management courses.
Swot Analysis of "Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management" written by Isabella Chan, James Lin, Benjamin Yen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hct Logistics facing as an external strategic factors. Some of the topics covered in Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management case study are - Strategic Management Strategies, IT, Joint ventures and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management casestudy better are - – increasing commodity prices, increasing transportation and logistics costs, there is backlash against globalization, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google,
talent flight as more people leaving formal jobs, technology disruption, etc
Introduction to SWOT Analysis of Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hct Logistics, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hct Logistics 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management can be done for the following purposes –
1. Strategic planning using facts provided in Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management case study
2. Improving business portfolio management of Hct Logistics
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 Hct Logistics
Strengths Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hct Logistics in Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Hct Logistics 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.
Analytics focus
– Hct Logistics 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 Isabella Chan, James Lin, Benjamin Yen 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.
Successful track record of launching new products
– Hct Logistics has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hct Logistics 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.
Strong track record of project management
– Hct Logistics 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
– Hct Logistics 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 Hct Logistics in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Hct Logistics 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Hct Logistics 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
– Hct Logistics has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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.
Learning organization
- Hct Logistics 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 Hct Logistics is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Hct Logistics is one of the leading recruiters in the industry. Managers in the Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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.
Innovation driven organization
– Hct Logistics is one of the most innovative firm in sector. Manager in Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Hct Logistics in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management are -
Low market penetration in new markets
– Outside its home market of Hct Logistics, firm in the HBR case study Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management 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 Hct Logistics has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management HBR case study mentions - Hct Logistics 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management, it seems that the employees of Hct Logistics 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.
Capital Spending Reduction
– Even during the low interest decade, Hct Logistics has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of Hct Logistics is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Hct Logistics needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hct Logistics to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management, is just above the industry average. Hct Logistics 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management, in the dynamic environment Hct Logistics has struggled to respond to the nimble upstart competition. Hct Logistics has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hct Logistics is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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.
Interest costs
– Compare to the competition, Hct Logistics 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.
Opportunities Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management are -
Manufacturing automation
– Hct Logistics 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hct Logistics can use these opportunities to build new business models that can help the communities that Hct Logistics operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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. Hct Logistics can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Hct Logistics 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. Hct Logistics 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.
Buying journey improvements
– Hct Logistics can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management 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.
Leveraging digital technologies
– Hct Logistics can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Developing new processes and practices
– Hct Logistics 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hct Logistics 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 Hct Logistics to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Hct Logistics 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.
Better consumer reach
– The expansion of the 5G network will help Hct Logistics to increase its market reach. Hct Logistics 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.
Using analytics as competitive advantage
– Hct Logistics 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hct Logistics to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hct Logistics can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hct Logistics 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.
Threats Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hct Logistics 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management .
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 Hct Logistics in the Strategy & Execution sector and impact the bottomline of the organization.
Environmental challenges
– Hct Logistics 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. Hct Logistics 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.
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. Hct Logistics 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Highly Confident Transportation: Dynamics of IT Application in Supply Chain Management, Hct Logistics 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 .
Stagnating economy with rate increase
– Hct Logistics 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.
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. Hct Logistics needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hct Logistics 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Hct Logistics with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Hct Logistics is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Hct Logistics
– 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 Hct Logistics.
Technology acceleration in Forth Industrial Revolution
– Hct Logistics has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Hct Logistics 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.
Weighted SWOT Analysis of Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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 Highly Confident Transportation: Dynamics of IT Application in Supply Chain 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 Hct Logistics needs to make to build a sustainable competitive advantage.
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