MiCRUS: Activity-Based Management for Business Turnaround SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of MiCRUS: Activity-Based Management for Business Turnaround
MiCRUS is a new company, spun off from IBM as a joint venture between IBM and Cirrus Logic to produce semiconductor wafers at world-class costs for its two parent companies. The senior management team needs to overcome the bureaucratic, internally focused culture that existed when the plant was a captive IBM supplier. They turn to activity-based costing/activity-based management to engender a more entrepreneurial culture where decentralized work teams take responsibility for initiating and accomplishing significant cost reduction projects. This case describes how project teams use activity-based information to identify opportunities and set priorities for cost reduction projects, and then report on progress at open management meetings. The senior managers also introduce an Open Book Management philosophy where financial data is shared with all employees.
Authors :: Robert S. Kaplan, Jonathan Schiff, Stanley Abraham
Swot Analysis of "MiCRUS: Activity-Based Management for Business Turnaround" written by Robert S. Kaplan, Jonathan Schiff, Stanley Abraham includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Micrus Activity facing as an external strategic factors. Some of the topics covered in MiCRUS: Activity-Based Management for Business Turnaround case study are - Strategic Management Strategies, Costs, IT, Managing people and Finance & Accounting.
Some of the macro environment factors that can be used to understand the MiCRUS: Activity-Based Management for Business Turnaround casestudy better are - – increasing transportation and logistics costs, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, challanges to central banks by blockchain based private currencies, geopolitical disruptions, supply chains are disrupted by pandemic ,
increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of MiCRUS: Activity-Based Management for Business Turnaround
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MiCRUS: Activity-Based Management for Business Turnaround case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Micrus Activity, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Micrus Activity 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 MiCRUS: Activity-Based Management for Business Turnaround can be done for the following purposes –
1. Strategic planning using facts provided in MiCRUS: Activity-Based Management for Business Turnaround case study
2. Improving business portfolio management of Micrus Activity
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Micrus Activity
Strengths MiCRUS: Activity-Based Management for Business Turnaround | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Micrus Activity in MiCRUS: Activity-Based Management for Business Turnaround Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Micrus Activity 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.
Learning organization
- Micrus Activity 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 Micrus Activity is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in MiCRUS: Activity-Based Management for Business Turnaround Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Micrus Activity is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Micrus Activity in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Micrus Activity has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in MiCRUS: Activity-Based Management for Business Turnaround 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.
High brand equity
– Micrus Activity has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Micrus Activity to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Micrus Activity 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 Robert S. Kaplan, Jonathan Schiff, Stanley Abraham 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.
Sustainable margins compare to other players in Finance & Accounting industry
– MiCRUS: Activity-Based Management for Business Turnaround firm has clearly differentiated products in the market place. This has enabled Micrus Activity to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Micrus Activity to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Micrus Activity is one of the leading recruiters in the industry. Managers in the MiCRUS: Activity-Based Management for Business Turnaround 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)
– Micrus Activity 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 MiCRUS: Activity-Based Management for Business Turnaround - 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
– Micrus Activity is one of the most innovative firm in sector. Manager in MiCRUS: Activity-Based Management for Business Turnaround 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 Finance & Accounting field
– Micrus Activity 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 Micrus Activity in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses MiCRUS: Activity-Based Management for Business Turnaround | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MiCRUS: Activity-Based Management for Business Turnaround are -
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 Micrus Activity supply chain. Even after few cautionary changes mentioned in the HBR case study - MiCRUS: Activity-Based Management for Business Turnaround, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Micrus Activity vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Micrus Activity needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the MiCRUS: Activity-Based Management for Business Turnaround 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 Micrus Activity 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, Micrus Activity is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study MiCRUS: Activity-Based Management for Business Turnaround can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Micrus Activity 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study MiCRUS: Activity-Based Management for Business Turnaround, in the dynamic environment Micrus Activity has struggled to respond to the nimble upstart competition. Micrus Activity has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As MiCRUS: Activity-Based Management for Business Turnaround HBR case study mentions - Micrus Activity 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.
Aligning sales with marketing
– It come across in the case study MiCRUS: Activity-Based Management for Business Turnaround 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 MiCRUS: Activity-Based Management for Business Turnaround can leverage the sales team experience to cultivate customer relationships as Micrus Activity is planning to shift buying processes online.
Increasing silos among functional specialists
– The organizational structure of Micrus Activity is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Micrus Activity needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Micrus Activity to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study MiCRUS: Activity-Based Management for Business Turnaround, it seems that company is thinking about the frontier risks that can impact Finance & Accounting 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study MiCRUS: Activity-Based Management for Business Turnaround, is just above the industry average. Micrus Activity 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.
Opportunities MiCRUS: Activity-Based Management for Business Turnaround | 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 MiCRUS: Activity-Based Management for Business Turnaround are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Micrus Activity can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Better consumer reach
– The expansion of the 5G network will help Micrus Activity to increase its market reach. Micrus Activity 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.
Building a culture of innovation
– managers at Micrus Activity 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 Finance & Accounting segment.
Buying journey improvements
– Micrus Activity can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. MiCRUS: Activity-Based Management for Business Turnaround 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Micrus Activity 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 Micrus Activity to hire the very best people irrespective of their geographical location.
Developing new processes and practices
– Micrus Activity can develop new processes and procedures in Finance & Accounting 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.
Creating value in data economy
– The success of analytics program of Micrus Activity has opened avenues for new revenue streams for the organization in the industry. This can help Micrus Activity to build a more holistic ecosystem as suggested in the MiCRUS: Activity-Based Management for Business Turnaround case study. Micrus Activity 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, Micrus Activity can use these opportunities to build new business models that can help the communities that Micrus Activity operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Micrus Activity 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. Micrus Activity 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Micrus Activity in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
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. Micrus Activity can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Micrus Activity 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, MiCRUS: Activity-Based Management for Business Turnaround, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Micrus Activity 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.
Threats MiCRUS: Activity-Based Management for Business Turnaround External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MiCRUS: Activity-Based Management for Business Turnaround are -
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 Micrus Activity business can come under increasing regulations regarding data privacy, data security, etc.
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. Micrus Activity needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Micrus Activity 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.
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.
Shortening product life cycle
– it is one of the major threat that Micrus Activity is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Micrus Activity.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Micrus Activity 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 MiCRUS: Activity-Based Management for Business Turnaround .
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Micrus Activity can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Micrus Activity in the Finance & Accounting industry. The Finance & Accounting 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.
Regulatory challenges
– Micrus Activity 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 Finance & Accounting industry regulations.
Environmental challenges
– Micrus Activity 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. Micrus Activity can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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 Micrus Activity in the Finance & Accounting sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Micrus Activity has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Micrus Activity needs to keep up with the evolution of technology in the Finance & Accounting 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.
Weighted SWOT Analysis of MiCRUS: Activity-Based Management for Business Turnaround 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 MiCRUS: Activity-Based Management for Business Turnaround 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 MiCRUS: Activity-Based Management for Business Turnaround 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 MiCRUS: Activity-Based Management for Business Turnaround 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 MiCRUS: Activity-Based Management for Business Turnaround 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 Micrus Activity needs to make to build a sustainable competitive advantage.