Dutch Natural Gas and the Groningen Field: The Creation of a New Industry SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Dutch Natural Gas and the Groningen Field: The Creation of a New Industry
This case describes the commercial development of natural resources via public-private cooperation. The case can be used to illustrate how natural resources can be well managed and beneficial to national economic development. With a specific focus on oil and gas, the case can be used to explore integration across project development, gas production, market development, and government relations. The role of the Dutch government as regulator and marketer provides a basis for discussing government involvement in natural resource development. The case also illustrates the complexity of major gas projects involving multiple countries and markets.
Swot Analysis of "Dutch Natural Gas and the Groningen Field: The Creation of a New Industry" written by Andrew C. Inkpen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Gas Natural facing as an external strategic factors. Some of the topics covered in Dutch Natural Gas and the Groningen Field: The Creation of a New Industry case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Dutch Natural Gas and the Groningen Field: The Creation of a New Industry casestudy better are - – cloud computing is disrupting traditional business models, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, increasing energy prices, there is increasing trade war between United States & China,
technology disruption, wage bills are increasing, etc
Introduction to SWOT Analysis of Dutch Natural Gas and the Groningen Field: The Creation of a New Industry
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Dutch Natural Gas and the Groningen Field: The Creation of a New Industry case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Gas Natural, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Gas Natural 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry can be done for the following purposes –
1. Strategic planning using facts provided in Dutch Natural Gas and the Groningen Field: The Creation of a New Industry case study
2. Improving business portfolio management of Gas Natural
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 Gas Natural
Strengths Dutch Natural Gas and the Groningen Field: The Creation of a New Industry | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Gas Natural in Dutch Natural Gas and the Groningen Field: The Creation of a New Industry Harvard Business Review case study are -
Organizational Resilience of Gas Natural
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Gas Natural does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Gas Natural is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Gas Natural has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Gas Natural in the sector have low bargaining power. Dutch Natural Gas and the Groningen Field: The Creation of a New Industry has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Gas Natural to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Gas Natural 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Gas Natural digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Gas Natural 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.
Ability to lead change in Strategy & Execution field
– Gas Natural 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 Gas Natural in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Gas Natural is one of the leading recruiters in the industry. Managers in the Dutch Natural Gas and the Groningen Field: The Creation of a New Industry are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Gas Natural 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 Andrew C. Inkpen 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 brand equity
– Gas Natural has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Gas Natural to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Strategy & Execution industry
– Dutch Natural Gas and the Groningen Field: The Creation of a New Industry firm has clearly differentiated products in the market place. This has enabled Gas Natural to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Gas Natural to invest into research and development (R&D) and innovation.
Learning organization
- Gas Natural 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 Gas Natural is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Dutch Natural Gas and the Groningen Field: The Creation of a New Industry Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Dutch Natural Gas and the Groningen Field: The Creation of a New Industry | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Dutch Natural Gas and the Groningen Field: The Creation of a New Industry are -
High operating costs
– Compare to the competitors, firm in the HBR case study Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Gas Natural 's lucrative customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Dutch Natural Gas and the Groningen Field: The Creation of a New Industry, is just above the industry average. Gas Natural 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.
Increasing silos among functional specialists
– The organizational structure of Gas Natural is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Gas Natural needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Gas Natural to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Dutch Natural Gas and the Groningen Field: The Creation of a New Industry, in the dynamic environment Gas Natural has struggled to respond to the nimble upstart competition. Gas Natural 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry, it seems that the employees of Gas Natural 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.
High cash cycle compare to competitors
Gas Natural 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.
Capital Spending Reduction
– Even during the low interest decade, Gas Natural 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.
Products dominated business model
– Even though Gas Natural 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 - Dutch Natural Gas and the Groningen Field: The Creation of a New Industry should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Gas Natural products
– To increase the profitability and margins on the products, Gas Natural needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Gas Natural has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Gas Natural has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Opportunities Dutch Natural Gas and the Groningen Field: The Creation of a New Industry | 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry are -
Manufacturing automation
– Gas Natural 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Gas Natural 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.
Leveraging digital technologies
– Gas Natural 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.
Using analytics as competitive advantage
– Gas Natural 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Gas Natural to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Gas Natural 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, Dutch Natural Gas and the Groningen Field: The Creation of a New Industry, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Gas Natural can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Gas Natural can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Gas Natural 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. Gas Natural 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Gas Natural is facing challenges because of the dominance of functional experts in the organization. Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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.
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 Gas Natural in the consumer business. Now Gas Natural can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Gas Natural has opened avenues for new revenue streams for the organization in the industry. This can help Gas Natural to build a more holistic ecosystem as suggested in the Dutch Natural Gas and the Groningen Field: The Creation of a New Industry case study. Gas Natural can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Gas Natural 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.
Better consumer reach
– The expansion of the 5G network will help Gas Natural to increase its market reach. Gas Natural will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Threats Dutch Natural Gas and the Groningen Field: The Creation of a New Industry External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Gas Natural business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Gas Natural 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.
Environmental challenges
– Gas Natural 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. Gas Natural can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Gas Natural 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Gas Natural 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.
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 Gas Natural.
Technology acceleration in Forth Industrial Revolution
– Gas Natural has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Gas Natural 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Gas Natural 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry .
High dependence on third party suppliers
– Gas Natural 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Gas Natural with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Gas Natural needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing wage structure of Gas Natural
– 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 Gas Natural.
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.
Weighted SWOT Analysis of Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Dutch Natural Gas and the Groningen Field: The Creation of a New Industry 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 Gas Natural needs to make to build a sustainable competitive advantage.
