Case Study Description of GT Nexus: Leader in Cloud Computing Supply Chain Management
T Nexus was incorporated in 2000 and in 2013 became a leader in cloud-based supply-chain management solutions. Born as a technology platform dedicated to the shipping industry and in particular to facilitating supply-chain management for major international carriers, in 2002 GT Nexus became in an SaaS (software as a service) provider, integrating analytics software on its platform. The Global Trade Platform introduced by GT Nexus was a major innovation in the shipping industry: it offered a standardized interface to shippers seeking to book cargo space with major carriers and allowed carriers to manage a far larger customer volume. Over time, the GTN platform became a non-industry specific supply-chain solution, used by some of the largest MNCs (multi-national corporations). GT Nexus expanded its product offering and platform, designing its own software solutions, such as the Trade Solution platform for financing, by partnering with other software companies, such as MicroStrategy and Flagship Custom Service, or by directly acquiring competitors, in the case of Metaship AG in Europe. A final merger with TradeCard in 2013 made GT Nexus the market leader in cloud-based supply-chain management software with over US$100 billion of international trade transactions managed on the platform. After the merger with TradeCard, GT Nexus offered a complete procure-to-pay solution on the cloud, covering every aspect of supply-chain management. The company experienced brisk growth as a pioneer of cloud-computing technology applied to supply chains. GT Nexus had several potential directions to sustain its growth. It could expand on its traditional customer base, the shipping industry, by aggressively pursuing market share, increase its software offerings to compete with ERP (enterprise resource planning) vendors, or further leverage its cloud-computing technology to deliver greater value.
Swot Analysis of "GT Nexus: Leader in Cloud Computing Supply Chain Management" written by Ali Farhoomand, Davide Lentini includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nexus Gt facing as an external strategic factors. Some of the topics covered in GT Nexus: Leader in Cloud Computing Supply Chain Management case study are - Strategic Management Strategies, Internet, IT, Supply chain and Strategy & Execution.
Some of the macro environment factors that can be used to understand the GT Nexus: Leader in Cloud Computing Supply Chain Management casestudy better are - – central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies, technology disruption, wage bills are increasing, increasing government debt because of Covid-19 spendings, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%,
geopolitical disruptions, increasing commodity prices, etc
Introduction to SWOT Analysis of GT Nexus: Leader in Cloud Computing Supply Chain Management
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in GT Nexus: Leader in Cloud Computing Supply Chain Management case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nexus Gt, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nexus Gt 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 GT Nexus: Leader in Cloud Computing Supply Chain Management can be done for the following purposes –
1. Strategic planning using facts provided in GT Nexus: Leader in Cloud Computing Supply Chain Management case study
2. Improving business portfolio management of Nexus Gt
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 Nexus Gt
Strengths GT Nexus: Leader in Cloud Computing Supply Chain Management | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nexus Gt in GT Nexus: Leader in Cloud Computing Supply Chain Management Harvard Business Review case study are -
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Nexus Gt digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Nexus Gt 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.
High brand equity
– Nexus Gt has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Nexus Gt to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Nexus Gt is one of the leading recruiters in the industry. Managers in the GT Nexus: Leader in Cloud Computing 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.
Sustainable margins compare to other players in Strategy & Execution industry
– GT Nexus: Leader in Cloud Computing Supply Chain Management firm has clearly differentiated products in the market place. This has enabled Nexus Gt to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Nexus Gt to invest into research and development (R&D) and innovation.
Learning organization
- Nexus Gt 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 Nexus Gt is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in GT Nexus: Leader in Cloud Computing Supply Chain Management Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Nexus Gt 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 GT Nexus: Leader in Cloud Computing 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.
Innovation driven organization
– Nexus Gt is one of the most innovative firm in sector. Manager in GT Nexus: Leader in Cloud Computing 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.
Cross disciplinary teams
– Horizontal connected teams at the Nexus Gt 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.
Successful track record of launching new products
– Nexus Gt has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nexus Gt 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.
Organizational Resilience of Nexus Gt
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Nexus Gt does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Nexus Gt is present in almost all the verticals within the industry. This has provided firm in GT Nexus: Leader in Cloud Computing Supply Chain Management case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to lead change in Strategy & Execution field
– Nexus Gt 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 Nexus Gt in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses GT Nexus: Leader in Cloud Computing Supply Chain Management | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of GT Nexus: Leader in Cloud Computing Supply Chain Management are -
Increasing silos among functional specialists
– The organizational structure of Nexus Gt is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Nexus Gt needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Nexus Gt to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Nexus Gt 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 Nexus Gt 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 - GT Nexus: Leader in Cloud Computing Supply Chain Management should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study GT Nexus: Leader in Cloud Computing 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Nexus Gt is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study GT Nexus: Leader in Cloud Computing 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Nexus Gt 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 operating costs
– Compare to the competitors, firm in the HBR case study GT Nexus: Leader in Cloud Computing Supply Chain Management 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 Nexus Gt 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Nexus Gt 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.
Slow decision making process
– As mentioned earlier in the report, Nexus Gt has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Nexus Gt even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study GT Nexus: Leader in Cloud Computing Supply Chain Management, in the dynamic environment Nexus Gt has struggled to respond to the nimble upstart competition. Nexus Gt has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the GT Nexus: Leader in Cloud Computing 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 Nexus Gt has relatively successful track record of launching new products.
Opportunities GT Nexus: Leader in Cloud Computing 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 GT Nexus: Leader in Cloud Computing Supply Chain Management are -
Using analytics as competitive advantage
– Nexus Gt 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 GT Nexus: Leader in Cloud Computing Supply Chain Management - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nexus Gt to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Nexus Gt can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. GT Nexus: Leader in Cloud Computing 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.
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 Nexus Gt 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Nexus Gt can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Nexus Gt 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
– Nexus Gt 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.
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. Nexus Gt can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Nexus Gt in the consumer business. Now Nexus Gt can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Nexus Gt has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nexus Gt is facing challenges because of the dominance of functional experts in the organization. GT Nexus: Leader in Cloud Computing Supply Chain Management 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.
Building a culture of innovation
– managers at Nexus Gt 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Nexus Gt 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, GT Nexus: Leader in Cloud Computing Supply Chain Management, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Nexus Gt 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.
Threats GT Nexus: Leader in Cloud Computing 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 GT Nexus: Leader in Cloud Computing Supply Chain Management are -
Technology acceleration in Forth Industrial Revolution
– Nexus Gt has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Nexus Gt 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nexus Gt 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 Nexus Gt with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Nexus Gt can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Nexus Gt 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.
High dependence on third party suppliers
– Nexus Gt 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study GT Nexus: Leader in Cloud Computing Supply Chain Management, Nexus Gt 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 .
Increasing wage structure of Nexus Gt
– 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 Nexus Gt.
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. Nexus Gt 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.
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 Nexus Gt business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Nexus Gt 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. Nexus Gt can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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 Nexus Gt.
Weighted SWOT Analysis of GT Nexus: Leader in Cloud Computing 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 GT Nexus: Leader in Cloud Computing 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 GT Nexus: Leader in Cloud Computing 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 GT Nexus: Leader in Cloud Computing 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 GT Nexus: Leader in Cloud Computing 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 Nexus Gt needs to make to build a sustainable competitive advantage.
