MDCM, Inc. (B): Strategic IT Portfolio Management SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of MDCM, Inc. (B): Strategic IT Portfolio Management
"MDCM, Inc. (B): Strategic IT Portfolio Management" examines the steps involved in developing a portfolio of IT projects aligned with a company's strategic objectives. Specifically, the case describes a situation where a firm has launched a transformation strategy but has yet to develop a complementary IT strategy. Students must select the optimal portfolio of projects aligned with the strategic objectives and define the global project execution strategy. The projects have both risks and dependencies. U.S.-based MDCM, Inc. specializes in medical device contract manufacturing and assembly. For the past five years, MDCM had grown by making more than twenty acquisitions of companies based outside the United States. This growth strategy enabled MDCM to better match its services to its customers, who had become larger and more global. In MDCM (A), the CIO of MDCM needed to determine the company's IT strategy and objectives. In doing so, he needed to ensure that they were properly aligned with the company's overall strategy and the new organization developed under an initiative called Horizon 2000. In a lecture prior to the cases, students should be introduced to the framework of IT portfolio management and how it can help focus IT efforts. In MDCM (B), the CIO has performed an audit of MDCM's IT and found twelve projects that are potential investment candidates for the next three years. The challenge for the IT Portfolio Management team is to identify the priority and appropriate sequence of investments to be made. The case assumes that students have knowledge of corporate IT. More specifically, the case is targeted for those who are or plan to become executives who would manage IT strategy and IT investment decisions either directly or in an oversight role. This case is the second in a series; the first is the case "MDCM, Inc. (A): IT Strategy Synchronization."
Authors :: Mark Jeffery, Joseph F. Norton, Derek Yung
Swot Analysis of "MDCM, Inc. (B): Strategic IT Portfolio Management" written by Mark Jeffery, Joseph F. Norton, Derek Yung includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mdcm Portfolio facing as an external strategic factors. Some of the topics covered in MDCM, Inc. (B): Strategic IT Portfolio Management case study are - Strategic Management Strategies, IT, Operations management, Performance measurement, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the MDCM, Inc. (B): Strategic IT Portfolio Management casestudy better are - – central banks are concerned over increasing inflation, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, increasing energy prices, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%,
increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of MDCM, Inc. (B): Strategic IT Portfolio Management
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MDCM, Inc. (B): Strategic IT Portfolio Management case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mdcm Portfolio, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management can be done for the following purposes –
1. Strategic planning using facts provided in MDCM, Inc. (B): Strategic IT Portfolio Management case study
2. Improving business portfolio management of Mdcm Portfolio
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 Mdcm Portfolio
Strengths MDCM, Inc. (B): Strategic IT Portfolio Management | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mdcm Portfolio in MDCM, Inc. (B): Strategic IT Portfolio Management Harvard Business Review case study are -
Innovation driven organization
– Mdcm Portfolio is one of the most innovative firm in sector. Manager in MDCM, Inc. (B): Strategic IT Portfolio Management Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High brand equity
– Mdcm Portfolio has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mdcm Portfolio to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Mdcm Portfolio is present in almost all the verticals within the industry. This has provided firm in MDCM, Inc. (B): Strategic IT Portfolio Management 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.
Learning organization
- Mdcm Portfolio 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 Mdcm Portfolio is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in MDCM, Inc. (B): Strategic IT Portfolio Management Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Mdcm Portfolio
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Mdcm Portfolio does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Mdcm Portfolio 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 Mark Jeffery, Joseph F. Norton, Derek Yung 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.
Ability to recruit top talent
– Mdcm Portfolio is one of the leading recruiters in the industry. Managers in the MDCM, Inc. (B): Strategic IT Portfolio Management 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
– Mdcm Portfolio is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Mdcm Portfolio 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.
Cross disciplinary teams
– Horizontal connected teams at the Mdcm Portfolio 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.
Effective Research and Development (R&D)
– Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the MDCM, Inc. (B): Strategic IT Portfolio Management 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.
Weaknesses MDCM, Inc. (B): Strategic IT Portfolio Management | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MDCM, Inc. (B): Strategic IT Portfolio Management 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 Mdcm Portfolio supply chain. Even after few cautionary changes mentioned in the HBR case study - MDCM, Inc. (B): Strategic IT Portfolio Management, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Mdcm Portfolio vulnerable to further global disruptions in South East Asia.
Capital Spending Reduction
– Even during the low interest decade, Mdcm Portfolio 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mdcm Portfolio is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study MDCM, Inc. (B): Strategic IT Portfolio Management can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Mdcm Portfolio 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Mark Jeffery, Joseph F. Norton, Derek Yung suggests that, Mdcm Portfolio 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study MDCM, Inc. (B): Strategic IT Portfolio Management, in the dynamic environment Mdcm Portfolio has struggled to respond to the nimble upstart competition. Mdcm Portfolio has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management can leverage the sales team experience to cultivate customer relationships as Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 Mdcm Portfolio has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As MDCM, Inc. (B): Strategic IT Portfolio Management HBR case study mentions - Mdcm Portfolio 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 Mdcm Portfolio 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 - MDCM, Inc. (B): Strategic IT Portfolio Management should strive to include more intangible value offerings along with its core products and services.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study MDCM, Inc. (B): Strategic IT Portfolio Management, is just above the industry average. Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management | 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 MDCM, Inc. (B): Strategic IT Portfolio Management are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Mdcm Portfolio 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, MDCM, Inc. (B): Strategic IT Portfolio Management, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Mdcm Portfolio 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mdcm Portfolio can use these opportunities to build new business models that can help the communities that Mdcm Portfolio operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Mdcm Portfolio 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 Mdcm Portfolio to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mdcm Portfolio can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Mdcm Portfolio 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
– Mdcm Portfolio 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.
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 Mdcm Portfolio 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.
Creating value in data economy
– The success of analytics program of Mdcm Portfolio has opened avenues for new revenue streams for the organization in the industry. This can help Mdcm Portfolio to build a more holistic ecosystem as suggested in the MDCM, Inc. (B): Strategic IT Portfolio Management case study. Mdcm Portfolio can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Mdcm Portfolio to increase its market reach. Mdcm Portfolio 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.
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. Mdcm Portfolio 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. Mdcm Portfolio 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.
Using analytics as competitive advantage
– Mdcm Portfolio has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study MDCM, Inc. (B): Strategic IT Portfolio Management - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mdcm Portfolio to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Mdcm Portfolio 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.
Threats MDCM, Inc. (B): Strategic IT Portfolio Management External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MDCM, Inc. (B): Strategic IT Portfolio Management are -
Increasing wage structure of Mdcm Portfolio
– 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 Mdcm Portfolio.
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 Mdcm Portfolio business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Mdcm Portfolio 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study MDCM, Inc. (B): Strategic IT Portfolio Management, Mdcm Portfolio may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Consumer confidence and its impact on Mdcm Portfolio 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.
Stagnating economy with rate increase
– Mdcm Portfolio 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
– Mdcm Portfolio 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Mdcm Portfolio 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.
Technology acceleration in Forth Industrial Revolution
– Mdcm Portfolio has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Mdcm Portfolio 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.
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 Mdcm Portfolio.
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. Mdcm Portfolio needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Mdcm Portfolio is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 MDCM, Inc. (B): Strategic IT Portfolio Management 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 Mdcm Portfolio needs to make to build a sustainable competitive advantage.