Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems
This module reading introduces diagnostic and interactive control systems. Diagnostic control systems are the management-by-exception systems that managers use to monitor the achievement of their business strategy. Interactive control systems are the systems that top managers use to focus the organization on strategic uncertainties. Diagnostic control systems and interactive control systems work together to ensure the implementation of today's strategy and, at the same time, allow the organization to position itself for tomorrow. The module discusses how managers choose which interactive system to use and explores the risks that are introduced through the use of these performance measurement and control systems. While this module is designed to be used alone, it is part of the Strategy Execution series. Taken together, the series forms a complete course that teaches the latest techniques for using performance measurement and control systems to implement strategy. Modules 1 - 4 set out the foundations for strategy implementation. Modules 5 - 10 teach quantitative tools for performance measurement and control. Modules 11 - 15 illustrate the use of these techniques by managers to achieve profit goals and strategies. View the full Strategy Execution series at: hbsp.harvard.edu/strategyexecution.
Swot Analysis of "Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems" written by Robert L. Simons includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Control Systems facing as an external strategic factors. Some of the topics covered in Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems case study are - Strategic Management Strategies, Corporate governance, Motivating people, Performance measurement, Strategic planning, Strategy execution and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems casestudy better are - – cloud computing is disrupting traditional business models, increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, digital marketing is dominated by two big players Facebook and Google, technology disruption, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion,
increasing commodity prices, wage bills are increasing, etc
Introduction to SWOT Analysis of Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Control Systems, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems can be done for the following purposes –
1. Strategic planning using facts provided in Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems case study
2. Improving business portfolio management of Control Systems
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 Control Systems
Strengths Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Control Systems in Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems Harvard Business Review case study are -
Successful track record of launching new products
– Control Systems has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Control Systems 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.
Strong track record of project management
– Control Systems is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Control Systems 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 Control Systems is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Control Systems is one of the most innovative firm in sector. Manager in Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Control Systems is present in almost all the verticals within the industry. This has provided firm in Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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.
Ability to lead change in Strategy & Execution field
– Control Systems 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 Control Systems in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Control Systems 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.
Ability to recruit top talent
– Control Systems is one of the leading recruiters in the industry. Managers in the Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Control Systems has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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
– Control Systems has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Control Systems to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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 Control Systems supply chain. Even after few cautionary changes mentioned in the HBR case study - Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Control Systems vulnerable to further global disruptions in South East Asia.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems, is just above the industry average. Control Systems 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.
Aligning sales with marketing
– It come across in the case study Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems can leverage the sales team experience to cultivate customer relationships as Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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 Control Systems has relatively successful track record of launching new products.
High operating costs
– Compare to the competitors, firm in the HBR case study Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Control Systems 's lucrative customers.
High cash cycle compare to competitors
Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems, in the dynamic environment Control Systems has struggled to respond to the nimble upstart competition. Control Systems has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Control Systems 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.
Capital Spending Reduction
– Even during the low interest decade, Control Systems 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.
Skills based hiring
– The stress on hiring functional specialists at Control Systems 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.
Slow to strategic competitive environment developments
– As Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems HBR case study mentions - Control Systems 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.
Opportunities Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems | 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems are -
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. Control Systems can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Control Systems can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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.
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. Control Systems 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. Control Systems 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Control Systems 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Control Systems can use these opportunities to build new business models that can help the communities that Control Systems operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Leveraging digital technologies
– Control Systems can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Manufacturing automation
– Control Systems can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Control Systems 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.
Creating value in data economy
– The success of analytics program of Control Systems has opened avenues for new revenue streams for the organization in the industry. This can help Control Systems to build a more holistic ecosystem as suggested in the Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems case study. Control Systems can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Control Systems in the consumer business. Now Control Systems can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Control Systems 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.
Better consumer reach
– The expansion of the 5G network will help Control Systems to increase its market reach. Control Systems 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Control Systems can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems are -
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.
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 Control Systems business can come under increasing regulations regarding data privacy, data security, etc.
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 Control Systems in the Strategy & Execution sector and impact the bottomline of the organization.
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.
High dependence on third party suppliers
– Control Systems 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.
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. Control Systems needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing wage structure of Control Systems
– 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 Control Systems.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems .
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 Control Systems.
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. Control Systems 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.
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. Control Systems can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Control Systems has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Control Systems 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Control Systems 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.
Weighted SWOT Analysis of Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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 Strategy Execution Module 11: Using Diagnostic and Interactive Control Systems 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 Control Systems needs to make to build a sustainable competitive advantage.
