Case Study Description of Suominen Wipes the Slate Clean
In 2016, after successfully turning around Finnish nonwovens manufacturer Suominen, CEO Nina Kopola faces a decision on the company's strategy moving forward.
Authors :: Boris Groysberg, Kalle Heikkinen, Michael Norris
Swot Analysis of "Suominen Wipes the Slate Clean" written by Boris Groysberg, Kalle Heikkinen, Michael Norris includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Suominen Kopola facing as an external strategic factors. Some of the topics covered in Suominen Wipes the Slate Clean case study are - Strategic Management Strategies, Manufacturing, Mergers & acquisitions and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Suominen Wipes the Slate Clean casestudy better are - – cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , increasing commodity prices, central banks are concerned over increasing inflation, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies,
there is increasing trade war between United States & China, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Suominen Wipes the Slate Clean
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Suominen Wipes the Slate Clean case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Suominen Kopola, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Suominen Kopola 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 Suominen Wipes the Slate Clean can be done for the following purposes –
1. Strategic planning using facts provided in Suominen Wipes the Slate Clean case study
2. Improving business portfolio management of Suominen Kopola
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 Suominen Kopola
Strengths Suominen Wipes the Slate Clean | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Suominen Kopola in Suominen Wipes the Slate Clean Harvard Business Review case study are -
Analytics focus
– Suominen Kopola 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 Boris Groysberg, Kalle Heikkinen, Michael Norris 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.
Strong track record of project management
– Suominen Kopola is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Suominen Kopola digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Suominen Kopola 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Suominen Wipes the Slate Clean firm has clearly differentiated products in the market place. This has enabled Suominen Kopola to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Suominen Kopola to invest into research and development (R&D) and innovation.
Ability to lead change in Strategy & Execution field
– Suominen Kopola 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 Suominen Kopola 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)
– Suominen Kopola 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 Suominen Wipes the Slate Clean - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Organizational Resilience of Suominen Kopola
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Suominen Kopola does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the Suominen Wipes the Slate Clean 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.
Learning organization
- Suominen Kopola 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 Suominen Kopola is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Suominen Wipes the Slate Clean Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Suominen Kopola 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.
Highly skilled collaborators
– Suominen Kopola 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 Suominen Wipes the Slate Clean HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Suominen Kopola has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Suominen Kopola to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Suominen Wipes the Slate Clean | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Suominen Wipes the Slate Clean are -
Capital Spending Reduction
– Even during the low interest decade, Suominen Kopola 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.
No frontier risks strategy
– After analyzing the HBR case study Suominen Wipes the Slate Clean, 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.
Lack of clear differentiation of Suominen Kopola products
– To increase the profitability and margins on the products, Suominen Kopola needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Suominen Kopola 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Suominen Kopola is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Suominen Wipes the Slate Clean can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Suominen Kopola 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.
Products dominated business model
– Even though Suominen Kopola 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 - Suominen Wipes the Slate Clean should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Suominen Kopola, firm in the HBR case study Suominen Wipes the Slate Clean 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 Suominen Kopola supply chain. Even after few cautionary changes mentioned in the HBR case study - Suominen Wipes the Slate Clean, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Suominen Kopola vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Suominen Wipes the Slate Clean 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 Suominen Kopola has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Suominen Wipes the Slate Clean 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 Suominen Kopola 's lucrative customers.
Opportunities Suominen Wipes the Slate Clean | 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 Suominen Wipes the Slate Clean are -
Learning at scale
– Online learning technologies has now opened space for Suominen Kopola 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.
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 Suominen Kopola 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Suominen Kopola 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 Suominen Kopola to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Suominen Kopola 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Suominen Kopola can use these opportunities to build new business models that can help the communities that Suominen Kopola operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Using analytics as competitive advantage
– Suominen Kopola 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 Suominen Wipes the Slate Clean - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Suominen Kopola to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Suominen Kopola 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Suominen Kopola 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.
Building a culture of innovation
– managers at Suominen Kopola can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Strategy & Execution segment.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Suominen Kopola in the consumer business. Now Suominen Kopola can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Suominen Kopola 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.
Creating value in data economy
– The success of analytics program of Suominen Kopola has opened avenues for new revenue streams for the organization in the industry. This can help Suominen Kopola to build a more holistic ecosystem as suggested in the Suominen Wipes the Slate Clean case study. Suominen Kopola can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Suominen Kopola 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, Suominen Wipes the Slate Clean, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Suominen Wipes the Slate Clean External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Suominen Wipes the Slate Clean are -
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 Suominen Kopola in the Strategy & Execution sector and impact the bottomline of the organization.
Regulatory challenges
– Suominen Kopola 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.
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 Suominen Kopola.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Suominen Kopola 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.
High dependence on third party suppliers
– Suominen Kopola 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.
Increasing wage structure of Suominen Kopola
– 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 Suominen Kopola.
Environmental challenges
– Suominen Kopola 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. Suominen Kopola 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.
Technology acceleration in Forth Industrial Revolution
– Suominen Kopola has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Suominen Kopola needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Shortening product life cycle
– it is one of the major threat that Suominen Kopola is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Suominen Wipes the Slate Clean, Suominen Kopola 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 .
Consumer confidence and its impact on Suominen Kopola 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.
Weighted SWOT Analysis of Suominen Wipes the Slate Clean 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 Suominen Wipes the Slate Clean 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 Suominen Wipes the Slate Clean 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 Suominen Wipes the Slate Clean 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 Suominen Wipes the Slate Clean 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 Suominen Kopola needs to make to build a sustainable competitive advantage.