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 - – geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, increasing commodity prices, there is backlash against globalization, central banks are concerned over increasing inflation, challanges to central banks by blockchain based private currencies,
increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto 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 -
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.
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.
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.
Superior customer experience
– The customer experience strategy of Mdcm Portfolio in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Mdcm Portfolio has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Mdcm Portfolio 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.
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.
Training and development
– Mdcm Portfolio has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in MDCM, Inc. (B): Strategic IT Portfolio Management 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.
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.
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.
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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Mdcm Portfolio digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Mdcm Portfolio 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.
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.
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 -
Low market penetration in new markets
– Outside its home market of Mdcm Portfolio, firm in the HBR case study MDCM, Inc. (B): Strategic IT Portfolio Management needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Mdcm Portfolio has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Mdcm Portfolio even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Need for greater diversity
– Mdcm Portfolio 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.
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.
Increasing silos among functional specialists
– The organizational structure of Mdcm Portfolio is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Mdcm Portfolio needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Mdcm Portfolio to focus more on services rather than just following the product oriented approach.
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.
Interest costs
– Compare to the competition, Mdcm Portfolio 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.
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.
Workers concerns about automation
– As automation is fast increasing in the segment, Mdcm Portfolio 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.
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.
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 -
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.
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.
Buying journey improvements
– Mdcm Portfolio can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. MDCM, Inc. (B): Strategic IT Portfolio Management 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.
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.
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.
Developing new processes and practices
– Mdcm Portfolio 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.
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.
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.
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. Mdcm Portfolio can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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.
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.
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.
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.
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 -
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.
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. Mdcm Portfolio 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
– 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mdcm Portfolio 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 MDCM, Inc. (B): Strategic IT Portfolio Management .
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 .
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.
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.
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.
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.
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.
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.
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 Mdcm Portfolio in the Strategy & Execution sector and impact the bottomline 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. Mdcm Portfolio needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
