Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A)

The chief executive officer (CEO) of Fortune Motors, the largest Mitsubishi dealership in Taiwan, has to consider his vision for the survival of the company. Fortune Motors' sales in 2003 had fallen below 50,000 units for the first time in 10 years, and market share had been falling for several years. The CEO had a plan to enter the business of financing used-car purchases. He thought that the "balanced scorecard" would be a useful tool to help him implement this change. The first step was to construct a corporate scorecard.

Authors :: David J. Sharp, Anne Wu

Topics :: Strategy & Execution

Tags :: Competitive strategy, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A)" written by David J. Sharp, Anne Wu includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Scorecard Fortune facing as an external strategic factors. Some of the topics covered in Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) case study are - Strategic Management Strategies, Competitive strategy and Strategy & Execution.

Some of the macro environment factors that can be used to understand the Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) casestudy better are - – increasing government debt because of Covid-19 spendings, there is increasing trade war between United States & China, increasing transportation and logistics costs, increasing household debt because of falling income levels, geopolitical disruptions, increasing energy prices, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, etc

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Introduction to SWOT Analysis of Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A)

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Scorecard Fortune, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Scorecard Fortune 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) can be done for the following purposes –
1. Strategic planning using facts provided in Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) case study
2. Improving business portfolio management of Scorecard Fortune
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 Scorecard Fortune

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Strengths Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Scorecard Fortune in Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) Harvard Business Review case study are -

High brand equity

– Scorecard Fortune has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Scorecard Fortune to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Superior customer experience

– The customer experience strategy of Scorecard Fortune in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Digital Transformation in Strategy & Execution segment

- digital transformation varies from industry to industry. For Scorecard Fortune digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Scorecard Fortune 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

– Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) firm has clearly differentiated products in the market place. This has enabled Scorecard Fortune to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Scorecard Fortune to invest into research and development (R&D) and innovation.

High switching costs

– The high switching costs that Scorecard Fortune 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.

Organizational Resilience of Scorecard Fortune

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Scorecard Fortune does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Diverse revenue streams

– Scorecard Fortune is present in almost all the verticals within the industry. This has provided firm in Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) 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 recruit top talent

– Scorecard Fortune is one of the leading recruiters in the industry. Managers in the Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

Strong track record of project management

– Scorecard Fortune is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Effective Research and Development (R&D)

– Scorecard Fortune 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 Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Ability to lead change in Strategy & Execution field

– Scorecard Fortune 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 Scorecard Fortune in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Low bargaining power of suppliers

– Suppliers of Scorecard Fortune in the sector have low bargaining power. Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Scorecard Fortune to manage not only supply disruptions but also source products at highly competitive prices.

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Weaknesses Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) are -

Workers concerns about automation

– As automation is fast increasing in the segment, Scorecard Fortune 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, Scorecard Fortune 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.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A), it seems that the employees of Scorecard Fortune 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.

Increasing silos among functional specialists

– The organizational structure of Scorecard Fortune is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Scorecard Fortune needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Scorecard Fortune to focus more on services rather than just following the product oriented approach.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A), in the dynamic environment Scorecard Fortune has struggled to respond to the nimble upstart competition. Scorecard Fortune 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, David J. Sharp, Anne Wu suggests that, Scorecard Fortune 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.

No frontier risks strategy

– After analyzing the HBR case study Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A), it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.

Aligning sales with marketing

– It come across in the case study Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) 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 Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) can leverage the sales team experience to cultivate customer relationships as Scorecard Fortune is planning to shift buying processes online.

Products dominated business model

– Even though Scorecard Fortune 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 - Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) should strive to include more intangible value offerings along with its core products and services.

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 Scorecard Fortune supply chain. Even after few cautionary changes mentioned in the HBR case study - Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Scorecard Fortune vulnerable to further global disruptions in South East Asia.

Capital Spending Reduction

– Even during the low interest decade, Scorecard Fortune 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.

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Opportunities Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) | 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 Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) are -

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Scorecard Fortune can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Loyalty marketing

– Scorecard Fortune 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Scorecard Fortune 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, Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Manufacturing automation

– Scorecard Fortune 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.

Creating value in data economy

– The success of analytics program of Scorecard Fortune has opened avenues for new revenue streams for the organization in the industry. This can help Scorecard Fortune to build a more holistic ecosystem as suggested in the Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) case study. Scorecard Fortune can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Scorecard Fortune 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 Scorecard Fortune 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. Scorecard Fortune can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Scorecard Fortune can use these opportunities to build new business models that can help the communities that Scorecard Fortune operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.

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. Scorecard Fortune can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Leveraging digital technologies

– Scorecard Fortune 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.

Reconfiguring business model

– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Scorecard Fortune to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.

Learning at scale

– Online learning technologies has now opened space for Scorecard Fortune 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.

Developing new processes and practices

– Scorecard Fortune 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.

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Threats Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) are -

Environmental challenges

– Scorecard Fortune 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. Scorecard Fortune can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.

Shortening product life cycle

– it is one of the major threat that Scorecard Fortune is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

High dependence on third party suppliers

– Scorecard Fortune high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.

Technology acceleration in Forth Industrial Revolution

– Scorecard Fortune has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Scorecard Fortune 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 Scorecard Fortune 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.

Increasing wage structure of Scorecard Fortune

– 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 Scorecard Fortune.

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 Scorecard Fortune business can come under increasing regulations regarding data privacy, data security, etc.

Consumer confidence and its impact on Scorecard Fortune 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.

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.

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. Scorecard Fortune needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.

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. Scorecard Fortune 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, Scorecard Fortune 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 Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) .

Stagnating economy with rate increase

– Scorecard Fortune 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.

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Weighted SWOT Analysis of Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) 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 Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) 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 Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) 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 Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) 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 Fortune Motors (Taiwan): Implementing Strategy Change Using the Balanced Scorecard (A) 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 Scorecard Fortune needs to make to build a sustainable competitive advantage.

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