Case Study Description of CSIRO: The Light Metals Flagship Decision
This case explores the challenge of investing in basic research as a public good. CSIRO was Australia's leading science and research agency, and it was chartered to enhance national prosperity through R&D. Its Flagships program was designed to align research interests with national priorities, with a strong focus on the adoption of research outputs. The Light Metals Flagship (LMF) was one of six flagships established in 2003, and its goal was to help the nation capture more of the added value of its resources by developing and commercializing downstream technologies in the processing and fabrication of products made from aluminum, magnesium, and titanium. While the LMF met with technical successes, Australian industry was reticent to co-invest. This lack of industry enthusiasm was in many ways unsurprising, as governments often found it important to fund long-term basic research that was outside of the horizon of firms. But what kind of a signal would stopping the program send? Was CSIRO prepared to let short-term thinking in light metals firms drive its agenda? The case examines the technical decision-making process.
Swot Analysis of "CSIRO: The Light Metals Flagship Decision" written by Willy Shih, Margaret Pierson, Dawn Lau includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Csiro Metals facing as an external strategic factors. Some of the topics covered in CSIRO: The Light Metals Flagship Decision case study are - Strategic Management Strategies, Globalization, Growth strategy, IT, Manufacturing, Research & development and Strategy & Execution.
Some of the macro environment factors that can be used to understand the CSIRO: The Light Metals Flagship Decision casestudy better are - – increasing commodity prices, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, geopolitical disruptions, central banks are concerned over increasing inflation, technology disruption,
increasing household debt because of falling income levels, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of CSIRO: The Light Metals Flagship Decision
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in CSIRO: The Light Metals Flagship Decision case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Csiro Metals, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Csiro Metals 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 CSIRO: The Light Metals Flagship Decision can be done for the following purposes –
1. Strategic planning using facts provided in CSIRO: The Light Metals Flagship Decision case study
2. Improving business portfolio management of Csiro Metals
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 Csiro Metals
Strengths CSIRO: The Light Metals Flagship Decision | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Csiro Metals in CSIRO: The Light Metals Flagship Decision Harvard Business Review case study are -
Strong track record of project management
– Csiro Metals is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Csiro Metals digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Csiro Metals has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Sustainable margins compare to other players in Strategy & Execution industry
– CSIRO: The Light Metals Flagship Decision firm has clearly differentiated products in the market place. This has enabled Csiro Metals to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Csiro Metals to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Csiro Metals 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
– Csiro Metals has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Csiro Metals 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.
Innovation driven organization
– Csiro Metals is one of the most innovative firm in sector. Manager in CSIRO: The Light Metals Flagship Decision Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Csiro Metals 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 Csiro Metals is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in CSIRO: The Light Metals Flagship Decision Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Csiro Metals
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Csiro Metals does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Csiro Metals in the sector have low bargaining power. CSIRO: The Light Metals Flagship Decision has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Csiro Metals to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Csiro Metals 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.
Training and development
– Csiro Metals has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in CSIRO: The Light Metals Flagship Decision 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.
Superior customer experience
– The customer experience strategy of Csiro Metals in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses CSIRO: The Light Metals Flagship Decision | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of CSIRO: The Light Metals Flagship Decision are -
Low market penetration in new markets
– Outside its home market of Csiro Metals, firm in the HBR case study CSIRO: The Light Metals Flagship Decision needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study CSIRO: The Light Metals Flagship Decision, in the dynamic environment Csiro Metals has struggled to respond to the nimble upstart competition. Csiro Metals 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, Willy Shih, Margaret Pierson, Dawn Lau suggests that, Csiro Metals 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Csiro Metals 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.
Interest costs
– Compare to the competition, Csiro Metals 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.
Capital Spending Reduction
– Even during the low interest decade, Csiro Metals has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Aligning sales with marketing
– It come across in the case study CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision can leverage the sales team experience to cultivate customer relationships as Csiro Metals is planning to shift buying processes online.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the CSIRO: The Light Metals Flagship Decision 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 Csiro Metals has relatively successful track record of launching new products.
High cash cycle compare to competitors
Csiro Metals has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Slow to strategic competitive environment developments
– As CSIRO: The Light Metals Flagship Decision HBR case study mentions - Csiro Metals 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Csiro Metals is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision | 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 CSIRO: The Light Metals Flagship Decision are -
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. Csiro Metals can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Csiro Metals 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 Csiro Metals to hire the very best people irrespective of their geographical location.
Creating value in data economy
– The success of analytics program of Csiro Metals has opened avenues for new revenue streams for the organization in the industry. This can help Csiro Metals to build a more holistic ecosystem as suggested in the CSIRO: The Light Metals Flagship Decision case study. Csiro Metals can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Csiro Metals can use these opportunities to build new business models that can help the communities that Csiro Metals operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
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. Csiro Metals 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. Csiro Metals 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.
Loyalty marketing
– Csiro Metals 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.
Better consumer reach
– The expansion of the 5G network will help Csiro Metals to increase its market reach. Csiro Metals 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.
Using analytics as competitive advantage
– Csiro Metals 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 CSIRO: The Light Metals Flagship Decision - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Csiro Metals to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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 Csiro Metals in the consumer business. Now Csiro Metals can target international markets with far fewer capital restrictions requirements than the existing system.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Csiro Metals is facing challenges because of the dominance of functional experts in the organization. CSIRO: The Light Metals Flagship Decision 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.
Developing new processes and practices
– Csiro Metals 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Csiro Metals 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Csiro Metals 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, CSIRO: The Light Metals Flagship Decision, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats CSIRO: The Light Metals Flagship Decision External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study CSIRO: The Light Metals Flagship Decision are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Csiro Metals 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.
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 Csiro Metals.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study CSIRO: The Light Metals Flagship Decision, Csiro Metals 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 .
Technology acceleration in Forth Industrial Revolution
– Csiro Metals has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Csiro Metals 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.
Stagnating economy with rate increase
– Csiro Metals 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.
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. Csiro Metals 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Csiro Metals can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study CSIRO: The Light Metals Flagship Decision .
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 Csiro Metals 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. Csiro Metals can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Csiro Metals 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. Csiro Metals can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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.
Regulatory challenges
– Csiro Metals 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.
Consumer confidence and its impact on Csiro Metals demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Weighted SWOT Analysis of CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision 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 CSIRO: The Light Metals Flagship Decision 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 Csiro Metals needs to make to build a sustainable competitive advantage.