Turkish Airlines: Widen Your World SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Turkish Airlines: Widen Your World
This case tracks Turkish Airlines' transition from regional player to global powerhouse. With an order for 212 aircraft in the first half of 2013, the airline had moved to double its size and become one of the industry's top-ten players. Growing its fleet would allow Turkish Airlines to fly many more destinations, boost revenues, increase aircraft utilization, and achieve higher cost efficiency. But it would also increase the already intense competition with European giants like Lufthansa, Air France, British Airways, and the fast-growth Gulf airlines Emirates, Etihad, and Qatar Airways. Critical questions faced CEO Temel Kotil and his team: How would Turkish Airlines keep growing without jeopardizing profitability? How would it manage the operational complexities and other external factors? Recruit the best people? Continue to differentiate itself in a fiercely competitive industry?
Swot Analysis of "Turkish Airlines: Widen Your World" written by Juan Alcacer, Esel Cekin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Turkish Airlines facing as an external strategic factors. Some of the topics covered in Turkish Airlines: Widen Your World case study are - Strategic Management Strategies, Emerging markets, Financial management, Globalization, Growth strategy, Joint ventures and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Turkish Airlines: Widen Your World casestudy better are - – increasing transportation and logistics costs, increasing commodity prices, there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , customer relationship management is fast transforming because of increasing concerns over data privacy,
wage bills are increasing, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Turkish Airlines: Widen Your World
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Turkish Airlines: Widen Your World case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Turkish Airlines, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Turkish Airlines 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 Turkish Airlines: Widen Your World can be done for the following purposes –
1. Strategic planning using facts provided in Turkish Airlines: Widen Your World case study
2. Improving business portfolio management of Turkish Airlines
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 Turkish Airlines
Strengths Turkish Airlines: Widen Your World | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Turkish Airlines in Turkish Airlines: Widen Your World Harvard Business Review case study are -
Learning organization
- Turkish Airlines 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 Turkish Airlines is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Turkish Airlines: Widen Your World Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Turkish Airlines is one of the leading recruiters in the industry. Managers in the Turkish Airlines: Widen Your World are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Turkish Airlines 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 Turkish Airlines: Widen Your World - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Highly skilled collaborators
– Turkish Airlines 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 Turkish Airlines: Widen Your World HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Turkish Airlines: Widen Your World 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.
Analytics focus
– Turkish Airlines 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 Juan Alcacer, Esel Cekin 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.
Superior customer experience
– The customer experience strategy of Turkish Airlines in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Strategy & Execution industry
– Turkish Airlines: Widen Your World firm has clearly differentiated products in the market place. This has enabled Turkish Airlines to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Turkish Airlines to invest into research and development (R&D) and innovation.
Innovation driven organization
– Turkish Airlines is one of the most innovative firm in sector. Manager in Turkish Airlines: Widen Your World Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Strategy & Execution field
– Turkish Airlines 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 Turkish Airlines in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Turkish Airlines in the sector have low bargaining power. Turkish Airlines: Widen Your World has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Turkish Airlines to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Turkish Airlines has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Turkish Airlines: Widen Your World 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.
Weaknesses Turkish Airlines: Widen Your World | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Turkish Airlines: Widen Your World are -
Interest costs
– Compare to the competition, Turkish Airlines has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High cash cycle compare to competitors
Turkish Airlines 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Turkish Airlines: Widen Your World, it seems that the employees of Turkish Airlines 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 bargaining power of channel partners
– Because of the regulatory requirements, Juan Alcacer, Esel Cekin suggests that, Turkish Airlines 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Turkish Airlines: Widen Your World, in the dynamic environment Turkish Airlines has struggled to respond to the nimble upstart competition. Turkish Airlines has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Turkish Airlines, firm in the HBR case study Turkish Airlines: Widen Your World 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 Turkish Airlines supply chain. Even after few cautionary changes mentioned in the HBR case study - Turkish Airlines: Widen Your World, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Turkish Airlines vulnerable to further global disruptions in South East Asia.
No frontier risks strategy
– After analyzing the HBR case study Turkish Airlines: Widen Your World, 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.
Aligning sales with marketing
– It come across in the case study Turkish Airlines: Widen Your World 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 Turkish Airlines: Widen Your World can leverage the sales team experience to cultivate customer relationships as Turkish Airlines is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Turkish Airlines is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Turkish Airlines needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Turkish Airlines to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Turkish Airlines 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 - Turkish Airlines: Widen Your World should strive to include more intangible value offerings along with its core products and services.
Opportunities Turkish Airlines: Widen Your World | 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 Turkish Airlines: Widen Your World are -
Building a culture of innovation
– managers at Turkish Airlines 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Turkish Airlines 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 Turkish Airlines to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Turkish Airlines 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.
Buying journey improvements
– Turkish Airlines can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Turkish Airlines: Widen Your World 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.
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 Turkish Airlines in the consumer business. Now Turkish Airlines can target international markets with far fewer capital restrictions requirements than the existing system.
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 Turkish Airlines 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Turkish Airlines can use these opportunities to build new business models that can help the communities that Turkish Airlines operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Turkish Airlines 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Turkish Airlines 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. Turkish Airlines 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. Turkish Airlines 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.
Learning at scale
– Online learning technologies has now opened space for Turkish Airlines 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.
Using analytics as competitive advantage
– Turkish Airlines 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 Turkish Airlines: Widen Your World - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Turkish Airlines to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Turkish Airlines has opened avenues for new revenue streams for the organization in the industry. This can help Turkish Airlines to build a more holistic ecosystem as suggested in the Turkish Airlines: Widen Your World case study. Turkish Airlines can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Turkish Airlines: Widen Your World External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Turkish Airlines: Widen Your World 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 Turkish Airlines in the Strategy & Execution sector and impact the bottomline of the organization.
Increasing wage structure of Turkish Airlines
– 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 Turkish Airlines.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Turkish Airlines with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Turkish Airlines 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. Turkish Airlines can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Turkish Airlines 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.
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. Turkish Airlines 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.
Consumer confidence and its impact on Turkish Airlines 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
– Turkish Airlines 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.
Stagnating economy with rate increase
– Turkish Airlines 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.
Shortening product life cycle
– it is one of the major threat that Turkish Airlines is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Turkish Airlines business can come under increasing regulations regarding data privacy, data security, etc.
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. Turkish Airlines can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of Turkish Airlines: Widen Your World 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 Turkish Airlines: Widen Your World 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 Turkish Airlines: Widen Your World 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 Turkish Airlines: Widen Your World 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 Turkish Airlines: Widen Your World 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 Turkish Airlines needs to make to build a sustainable competitive advantage.
