Outsourcing at Office Supply Inc. SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Outsourcing at Office Supply Inc.
This case is designed to teach how to structure information technology (IT) infrastructure outsourcing deals from both the outsourcer and the client perspective. Office Supply Incorporated (OSI) is a company in crisis, with challenges in its cost structure and poor IT performance. Outsourcing to Technology Infrastructure Solutions is an opportunity to both reduce costs and complexity for the firm, but students first must consider whether outsourcing is a good strategic fit for OSI. Detailed spreadsheet templates are given that are based on a real outsourcing client engagement for a major infrastructure outsourcing company. The spreadsheets are complex but have been simplified so that they automatically calculate when populated, allowing the students to quickly move to answering the management challenge: how should TIS price and structure the outsourcing deal? Answering this question provides deep insights into the business case for IT outsourcing and how outsourcers financially engineer a deal structure to ensure a win-win outcome for both the client and outsource service provider.
Authors :: Mark Jeffery, James Anfield, Subhankar Bhowmick
Swot Analysis of "Outsourcing at Office Supply Inc." written by Mark Jeffery, James Anfield, Subhankar Bhowmick includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Outsourcing Osi facing as an external strategic factors. Some of the topics covered in Outsourcing at Office Supply Inc. case study are - Strategic Management Strategies, Intellectual property, International business, IT, Operations management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Outsourcing at Office Supply Inc. casestudy better are - – geopolitical disruptions, increasing transportation and logistics costs, central banks are concerned over increasing inflation, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings,
there is backlash against globalization, wage bills are increasing, etc
Introduction to SWOT Analysis of Outsourcing at Office Supply Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Outsourcing at Office Supply Inc. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Outsourcing Osi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Outsourcing Osi 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 Outsourcing at Office Supply Inc. can be done for the following purposes –
1. Strategic planning using facts provided in Outsourcing at Office Supply Inc. case study
2. Improving business portfolio management of Outsourcing Osi
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 Outsourcing Osi
Strengths Outsourcing at Office Supply Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Outsourcing Osi in Outsourcing at Office Supply Inc. Harvard Business Review case study are -
Analytics focus
– Outsourcing Osi 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 Mark Jeffery, James Anfield, Subhankar Bhowmick 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.
Innovation driven organization
– Outsourcing Osi is one of the most innovative firm in sector. Manager in Outsourcing at Office Supply Inc. Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Outsourcing Osi 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 Outsourcing Osi is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Outsourcing at Office Supply Inc. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Outsourcing Osi
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Outsourcing Osi does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Outsourcing Osi 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 Outsourcing at Office Supply Inc. HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Outsourcing Osi is one of the leading recruiters in the industry. Managers in the Outsourcing at Office Supply Inc. are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy in the Outsourcing at Office Supply Inc. 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.
High switching costs
– The high switching costs that Outsourcing Osi 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.
Cross disciplinary teams
– Horizontal connected teams at the Outsourcing Osi 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.
Strong track record of project management
– Outsourcing Osi is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High brand equity
– Outsourcing Osi has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Outsourcing Osi to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Outsourcing Osi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Outsourcing Osi 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.
Weaknesses Outsourcing at Office Supply Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Outsourcing at Office Supply Inc. are -
Lack of clear differentiation of Outsourcing Osi products
– To increase the profitability and margins on the products, Outsourcing Osi needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Outsourcing at Office Supply Inc., in the dynamic environment Outsourcing Osi has struggled to respond to the nimble upstart competition. Outsourcing Osi has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As Outsourcing at Office Supply Inc. HBR case study mentions - Outsourcing Osi takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
High bargaining power of channel partners
– Because of the regulatory requirements, Mark Jeffery, James Anfield, Subhankar Bhowmick suggests that, Outsourcing Osi 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.
Aligning sales with marketing
– It come across in the case study Outsourcing at Office Supply Inc. that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Outsourcing at Office Supply Inc. can leverage the sales team experience to cultivate customer relationships as Outsourcing Osi is planning to shift buying processes online.
Workers concerns about automation
– As automation is fast increasing in the segment, Outsourcing Osi 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.
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 Outsourcing Osi supply chain. Even after few cautionary changes mentioned in the HBR case study - Outsourcing at Office Supply Inc., it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Outsourcing Osi vulnerable to further global disruptions in South East Asia.
Products dominated business model
– Even though Outsourcing Osi 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 - Outsourcing at Office Supply Inc. should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Outsourcing Osi 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Outsourcing at Office Supply Inc. 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 Outsourcing Osi has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Outsourcing Osi is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Outsourcing at Office Supply Inc. can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Outsourcing at Office Supply Inc. | 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 Outsourcing at Office Supply Inc. are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Outsourcing Osi 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.
Developing new processes and practices
– Outsourcing Osi 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Outsourcing Osi can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Outsourcing Osi can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– Outsourcing Osi 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 Outsourcing at Office Supply Inc. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Outsourcing Osi to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Outsourcing Osi 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. Outsourcing Osi 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.
Better consumer reach
– The expansion of the 5G network will help Outsourcing Osi to increase its market reach. Outsourcing Osi 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.
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 Outsourcing Osi in the consumer business. Now Outsourcing Osi can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Outsourcing Osi 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 Outsourcing Osi to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Outsourcing Osi 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, Outsourcing Osi 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, Outsourcing at Office Supply Inc., to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Outsourcing Osi 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.
Buying journey improvements
– Outsourcing Osi can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Outsourcing at Office Supply Inc. 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.
Threats Outsourcing at Office Supply Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Outsourcing at Office Supply Inc. are -
Increasing wage structure of Outsourcing Osi
– 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 Outsourcing Osi.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Outsourcing at Office Supply Inc., Outsourcing Osi 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 .
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. Outsourcing Osi needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
High dependence on third party suppliers
– Outsourcing Osi 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.
Stagnating economy with rate increase
– Outsourcing Osi 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.
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 Outsourcing Osi business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Outsourcing Osi with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Outsourcing Osi has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Outsourcing Osi 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.
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. Outsourcing Osi 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 Outsourcing Osi 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.
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.
Shortening product life cycle
– it is one of the major threat that Outsourcing Osi is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Outsourcing at Office Supply Inc. 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 Outsourcing at Office Supply Inc. 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 Outsourcing at Office Supply Inc. 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 Outsourcing at Office Supply Inc. 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 Outsourcing at Office Supply Inc. 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 Outsourcing Osi needs to make to build a sustainable competitive advantage.