Innovating Our Way to the Next Industrial Revolution SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
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Case Study SWOT Analysis Solution
Case Study Description of Innovating Our Way to the Next Industrial Revolution
This is an MIT Sloan Management Review article. In many ways, the Industrial Age has been an era of harvesting natural and social capital to create financial and productive capital. So far, the New Economy looks more like the next wave of the industrial era than a truly postindustrial one. Why should we care? Because, say the authors, the basic development patterns of the industrial era are not sustainable. In the face of this challenge, organizational learning expert Peter Senge and former Volvo and IKEA senior executive Goran Carstedt hail the emergence of a new environmentalism driven by innovation, not regulation--radical new technologies, products, processes, and business models. They describe how more and more companies are recognizing the business opportunities that a focus on sustainability creates. Such a shift in thinking is already evident in many companies and industries, where learning-organization principles are being applied to create sustainable business models. Simultaneously, they become inspirational, energetic places to work, where even relationships with customers and suppliers improve. Nonetheless, ecoefficiency alone will not create a truly postindustrial age: a strategy must consider how the economic system affects the larger ecological and social systems within which it resides. Only a more integrated view will enable companies to innovate for long-term profitability and sustainability. There are three core competencies that learning organizations must master to profit from sustainability: encourage systemic thinking to sense the emerging future; convene strategic conversations with investors, customers, suppliers, and even competitors to build the trust needed to change outmoded mental models about what business success is; and take the lead in reshaping economic, political, and societal forces that stymie change. According to Senge and Carstedt, no time in history has afforded greater possibilities for a collective change in direction.
Swot Analysis of "Innovating Our Way to the Next Industrial Revolution" written by Peter M. Senge, Goran Carstedt includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Carstedt Postindustrial facing as an external strategic factors. Some of the topics covered in Innovating Our Way to the Next Industrial Revolution case study are - Strategic Management Strategies, Change management, Innovation, Internet, Sustainability, Transparency and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Innovating Our Way to the Next Industrial Revolution casestudy better are - – cloud computing is disrupting traditional business models, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, digital marketing is dominated by two big players Facebook and Google, increasing energy prices, challanges to central banks by blockchain based private currencies,
customer relationship management is fast transforming because of increasing concerns over data privacy, technology disruption, etc
Introduction to SWOT Analysis of Innovating Our Way to the Next Industrial Revolution
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Innovating Our Way to the Next Industrial Revolution case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Carstedt Postindustrial, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Carstedt Postindustrial 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 Innovating Our Way to the Next Industrial Revolution can be done for the following purposes –
1. Strategic planning using facts provided in Innovating Our Way to the Next Industrial Revolution case study
2. Improving business portfolio management of Carstedt Postindustrial
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 Carstedt Postindustrial
Strengths Innovating Our Way to the Next Industrial Revolution | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Carstedt Postindustrial in Innovating Our Way to the Next Industrial Revolution Harvard Business Review case study are -
Effective Research and Development (R&D)
– Carstedt Postindustrial 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 Innovating Our Way to the Next Industrial Revolution - 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
– Carstedt Postindustrial 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 Innovating Our Way to the Next Industrial Revolution HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Carstedt Postindustrial
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Carstedt Postindustrial does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to lead change in Strategy & Execution field
– Carstedt Postindustrial 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 Carstedt Postindustrial in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Carstedt Postindustrial is one of the most innovative firm in sector. Manager in Innovating Our Way to the Next Industrial Revolution Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Carstedt Postindustrial 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 Peter M. Senge, Goran Carstedt 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.
Operational resilience
– The operational resilience strategy in the Innovating Our Way to the Next Industrial Revolution 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.
Training and development
– Carstedt Postindustrial has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Innovating Our Way to the Next Industrial Revolution 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Innovating Our Way to the Next Industrial Revolution firm has clearly differentiated products in the market place. This has enabled Carstedt Postindustrial to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Carstedt Postindustrial to invest into research and development (R&D) and innovation.
High brand equity
– Carstedt Postindustrial has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Carstedt Postindustrial to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Strong track record of project management
– Carstedt Postindustrial is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Carstedt Postindustrial is present in almost all the verticals within the industry. This has provided firm in Innovating Our Way to the Next Industrial Revolution 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.
Weaknesses Innovating Our Way to the Next Industrial Revolution | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Innovating Our Way to the Next Industrial Revolution are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Carstedt Postindustrial is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Innovating Our Way to the Next Industrial Revolution can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Carstedt Postindustrial 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.
Slow to strategic competitive environment developments
– As Innovating Our Way to the Next Industrial Revolution HBR case study mentions - Carstedt Postindustrial 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.
Products dominated business model
– Even though Carstedt Postindustrial 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 - Innovating Our Way to the Next Industrial Revolution should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Carstedt Postindustrial products
– To increase the profitability and margins on the products, Carstedt Postindustrial needs to provide more differentiated products than what it is currently offering in the marketplace.
Workers concerns about automation
– As automation is fast increasing in the segment, Carstedt Postindustrial 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Innovating Our Way to the Next Industrial Revolution, it seems that the employees of Carstedt Postindustrial 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, Peter M. Senge, Goran Carstedt suggests that, Carstedt Postindustrial 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.
Skills based hiring
– The stress on hiring functional specialists at Carstedt Postindustrial has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Need for greater diversity
– Carstedt Postindustrial 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.
Aligning sales with marketing
– It come across in the case study Innovating Our Way to the Next Industrial Revolution 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 Innovating Our Way to the Next Industrial Revolution can leverage the sales team experience to cultivate customer relationships as Carstedt Postindustrial is planning to shift buying processes online.
Opportunities Innovating Our Way to the Next Industrial Revolution | 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 Innovating Our Way to the Next Industrial Revolution are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Carstedt Postindustrial 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Carstedt Postindustrial 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 Carstedt Postindustrial to hire the very best people irrespective of their geographical location.
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. Carstedt Postindustrial can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Carstedt Postindustrial can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Carstedt Postindustrial can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Learning at scale
– Online learning technologies has now opened space for Carstedt Postindustrial 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Carstedt Postindustrial is facing challenges because of the dominance of functional experts in the organization. Innovating Our Way to the Next Industrial Revolution 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
– Carstedt Postindustrial 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.
Better consumer reach
– The expansion of the 5G network will help Carstedt Postindustrial to increase its market reach. Carstedt Postindustrial 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.
Creating value in data economy
– The success of analytics program of Carstedt Postindustrial has opened avenues for new revenue streams for the organization in the industry. This can help Carstedt Postindustrial to build a more holistic ecosystem as suggested in the Innovating Our Way to the Next Industrial Revolution case study. Carstedt Postindustrial can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Carstedt Postindustrial 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.
Building a culture of innovation
– managers at Carstedt Postindustrial 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.
Loyalty marketing
– Carstedt Postindustrial 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 Innovating Our Way to the Next Industrial Revolution External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Innovating Our Way to the Next Industrial Revolution are -
Shortening product life cycle
– it is one of the major threat that Carstedt Postindustrial is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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. Carstedt Postindustrial needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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. Carstedt Postindustrial can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Carstedt Postindustrial 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.
Regulatory challenges
– Carstedt Postindustrial 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.
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.
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 Carstedt Postindustrial business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Carstedt Postindustrial with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Carstedt Postindustrial 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. Carstedt Postindustrial can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Technology acceleration in Forth Industrial Revolution
– Carstedt Postindustrial has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Carstedt Postindustrial 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.
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. Carstedt Postindustrial 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Carstedt Postindustrial 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.
Consumer confidence and its impact on Carstedt Postindustrial 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 Innovating Our Way to the Next Industrial Revolution 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 Innovating Our Way to the Next Industrial Revolution 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 Innovating Our Way to the Next Industrial Revolution 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 Innovating Our Way to the Next Industrial Revolution 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 Innovating Our Way to the Next Industrial Revolution 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 Carstedt Postindustrial needs to make to build a sustainable competitive advantage.