Balancing the Power Equation: Suzlon Energy Limited SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Balancing the Power Equation: Suzlon Energy Limited
Set in 2013, the case documents the challenges encountered by an emerging economy multinational enterprise (EMNE) when accessing R&D knowledge from its technologically superior subsidiary. Further, it shows the strategies that Suzlon, an Indian wind turbine manufacturer, adopted to catch up with global industry leaders. It tracks how Suzlon's astute and aggressive chairman, Tulsi Tanti, led the company to develop the capabilities to perform higher value added activities despite being a late industry entrant and one, moreover, from an emerging economy. The setting for the case is the global wind power industry, an emerging high-tech industry. The case thus shows that EMNEs are entering and succeeding not only in mature industries but also in newly emerging industries. By acquiring technologically superior firms, Suzlon made a mark in the global wind power industry dominated by European and American companies. While most of its acquisitions successfully served their purpose, Suzlon's 2007 acquisition of the German wind turbine manufacturer REpower did not go as planned. REpower was a technology-focused firm with expertise in large offshore turbines. Suzlon's goal was to access REpower's technology and combine it with Suzlon's low manufacturing cost and operational efficiency to gain competitive advantage over rivals. However, the expected knowledge transfer from this acquisition did not materialize as quickly as planned due to REpower's refusal to share its technology with its parent, Suzlon. The case primarily describes the challenges involved in this acquisition, amplified by the economic recession of 2008. It shows Tanti's attempts to make the acquisition work by balancing the "power" struggle between the Indian parent and the German subsidiary. Further, by tracking Suzlon right from its inception, it also describes Suzlon's catch-up strategies to emerge as a market leader in India and the fifth largest wind turbine manufacturer in the world.
Swot Analysis of "Balancing the Power Equation: Suzlon Energy Limited" written by Snehal Awate, Ram Mudambi, Arohini Narain includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Suzlon's Suzlon facing as an external strategic factors. Some of the topics covered in Balancing the Power Equation: Suzlon Energy Limited case study are - Strategic Management Strategies, Influence and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Balancing the Power Equation: Suzlon Energy Limited casestudy better are - – increasing transportation and logistics costs, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation,
there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Balancing the Power Equation: Suzlon Energy Limited
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Balancing the Power Equation: Suzlon Energy Limited case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Suzlon's Suzlon, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Suzlon's Suzlon 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 Balancing the Power Equation: Suzlon Energy Limited can be done for the following purposes –
1. Strategic planning using facts provided in Balancing the Power Equation: Suzlon Energy Limited case study
2. Improving business portfolio management of Suzlon's Suzlon
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 Suzlon's Suzlon
Strengths Balancing the Power Equation: Suzlon Energy Limited | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Suzlon's Suzlon in Balancing the Power Equation: Suzlon Energy Limited Harvard Business Review case study are -
Ability to lead change in Strategy & Execution field
– Suzlon's Suzlon 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 Suzlon's Suzlon in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Balancing the Power Equation: Suzlon Energy Limited 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.
Effective Research and Development (R&D)
– Suzlon's Suzlon 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 Balancing the Power Equation: Suzlon Energy Limited - 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
– Suzlon's Suzlon 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 Balancing the Power Equation: Suzlon Energy Limited HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Suzlon's Suzlon is present in almost all the verticals within the industry. This has provided firm in Balancing the Power Equation: Suzlon Energy Limited 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Balancing the Power Equation: Suzlon Energy Limited firm has clearly differentiated products in the market place. This has enabled Suzlon's Suzlon to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Suzlon's Suzlon to invest into research and development (R&D) and innovation.
Organizational Resilience of Suzlon's Suzlon
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Suzlon's Suzlon does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Strong track record of project management
– Suzlon's Suzlon is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Suzlon's Suzlon in the sector have low bargaining power. Balancing the Power Equation: Suzlon Energy Limited has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Suzlon's Suzlon to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Suzlon's Suzlon is one of the most innovative firm in sector. Manager in Balancing the Power Equation: Suzlon Energy Limited Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Suzlon's Suzlon 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 Suzlon's Suzlon is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Balancing the Power Equation: Suzlon Energy Limited Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Superior customer experience
– The customer experience strategy of Suzlon's Suzlon in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Balancing the Power Equation: Suzlon Energy Limited | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Balancing the Power Equation: Suzlon Energy Limited are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Balancing the Power Equation: Suzlon Energy Limited, is just above the industry average. Suzlon's Suzlon needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Increasing silos among functional specialists
– The organizational structure of Suzlon's Suzlon is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Suzlon's Suzlon needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Suzlon's Suzlon to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Balancing the Power Equation: Suzlon Energy Limited 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 Suzlon's Suzlon 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, Suzlon's Suzlon is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Balancing the Power Equation: Suzlon Energy Limited can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Suzlon's Suzlon 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Balancing the Power Equation: Suzlon Energy Limited, in the dynamic environment Suzlon's Suzlon has struggled to respond to the nimble upstart competition. Suzlon's Suzlon has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High bargaining power of channel partners
– Because of the regulatory requirements, Snehal Awate, Ram Mudambi, Arohini Narain suggests that, Suzlon's Suzlon 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.
Interest costs
– Compare to the competition, Suzlon's Suzlon 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.
No frontier risks strategy
– After analyzing the HBR case study Balancing the Power Equation: Suzlon Energy Limited, 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.
Need for greater diversity
– Suzlon's Suzlon 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Balancing the Power Equation: Suzlon Energy Limited, it seems that the employees of Suzlon's Suzlon 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.
Opportunities Balancing the Power Equation: Suzlon Energy Limited | 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 Balancing the Power Equation: Suzlon Energy Limited are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Suzlon's Suzlon 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Suzlon's Suzlon 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, Balancing the Power Equation: Suzlon Energy Limited, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Suzlon's Suzlon in the consumer business. Now Suzlon's Suzlon can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Suzlon's Suzlon can use these opportunities to build new business models that can help the communities that Suzlon's Suzlon operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Developing new processes and practices
– Suzlon's Suzlon 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.
Loyalty marketing
– Suzlon's Suzlon 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.
Using analytics as competitive advantage
– Suzlon's Suzlon 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 Balancing the Power Equation: Suzlon Energy Limited - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Suzlon's Suzlon to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Suzlon's Suzlon can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Buying journey improvements
– Suzlon's Suzlon can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Balancing the Power Equation: Suzlon Energy Limited 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Suzlon's Suzlon can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Suzlon's Suzlon is facing challenges because of the dominance of functional experts in the organization. Balancing the Power Equation: Suzlon Energy Limited 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.
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. Suzlon's Suzlon 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. Suzlon's Suzlon 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 Suzlon's Suzlon 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.
Threats Balancing the Power Equation: Suzlon Energy Limited External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Balancing the Power Equation: Suzlon Energy Limited are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Balancing the Power Equation: Suzlon Energy Limited, Suzlon's Suzlon 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 .
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.
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. Suzlon's Suzlon 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Suzlon's Suzlon with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Suzlon's Suzlon
– 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 Suzlon's Suzlon.
High dependence on third party suppliers
– Suzlon's Suzlon 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.
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. Suzlon's Suzlon can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Suzlon's Suzlon.
Regulatory challenges
– Suzlon's Suzlon needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
Environmental challenges
– Suzlon's Suzlon 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. Suzlon's Suzlon can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Suzlon's Suzlon needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Suzlon's Suzlon 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 Balancing the Power Equation: Suzlon Energy Limited 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 Balancing the Power Equation: Suzlon Energy Limited 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 Balancing the Power Equation: Suzlon Energy Limited 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 Balancing the Power Equation: Suzlon Energy Limited 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 Balancing the Power Equation: Suzlon Energy Limited 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 Suzlon's Suzlon needs to make to build a sustainable competitive advantage.
