Swot Analysis of "Block 16: Conoco's "Green" Oil Strategy (D)" written by Malcolm S. Salter, Susan E.A. Hall includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Conoco's Continuation facing as an external strategic factors. Some of the topics covered in Block 16: Conoco's "Green" Oil Strategy (D) case study are - Strategic Management Strategies, Ethics, Policy, Social responsibility, Sustainability and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Block 16: Conoco's "Green" Oil Strategy (D) casestudy better are - – supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, increasing transportation and logistics costs, increasing commodity prices,
increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Block 16: Conoco's "Green" Oil Strategy (D)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Block 16: Conoco's "Green" Oil Strategy (D) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Conoco's Continuation, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Conoco's Continuation 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 Block 16: Conoco's "Green" Oil Strategy (D) can be done for the following purposes –
1. Strategic planning using facts provided in Block 16: Conoco's "Green" Oil Strategy (D) case study
2. Improving business portfolio management of Conoco's Continuation
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 Conoco's Continuation
Strengths Block 16: Conoco's "Green" Oil Strategy (D) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Conoco's Continuation in Block 16: Conoco's "Green" Oil Strategy (D) Harvard Business Review case study are -
Successful track record of launching new products
– Conoco's Continuation has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Conoco's Continuation 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.
Learning organization
- Conoco's Continuation 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 Conoco's Continuation is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Block 16: Conoco's "Green" Oil Strategy (D) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Conoco's Continuation 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.
Diverse revenue streams
– Conoco's Continuation is present in almost all the verticals within the industry. This has provided firm in Block 16: Conoco's "Green" Oil Strategy (D) 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.
High switching costs
– The high switching costs that Conoco's Continuation 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.
Superior customer experience
– The customer experience strategy of Conoco's Continuation in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Conoco's Continuation 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 Block 16: Conoco's "Green" Oil Strategy (D) - 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
– Conoco's Continuation 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 Conoco's Continuation in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Conoco's Continuation has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Conoco's Continuation to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Conoco's Continuation 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 Block 16: Conoco's "Green" Oil Strategy (D) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Conoco's Continuation has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Block 16: Conoco's "Green" Oil Strategy (D) 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.
Analytics focus
– Conoco's Continuation 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 Malcolm S. Salter, Susan E.A. Hall 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.
Weaknesses Block 16: Conoco's "Green" Oil Strategy (D) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Block 16: Conoco's "Green" Oil Strategy (D) are -
Capital Spending Reduction
– Even during the low interest decade, Conoco's Continuation 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.
No frontier risks strategy
– After analyzing the HBR case study Block 16: Conoco's "Green" Oil Strategy (D), 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Block 16: Conoco's "Green" Oil Strategy (D) 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 Conoco's Continuation 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, Malcolm S. Salter, Susan E.A. Hall suggests that, Conoco's Continuation 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.
Lack of clear differentiation of Conoco's Continuation products
– To increase the profitability and margins on the products, Conoco's Continuation needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Block 16: Conoco's "Green" Oil Strategy (D), it seems that the employees of Conoco's Continuation don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High cash cycle compare to competitors
Conoco's Continuation 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.
Products dominated business model
– Even though Conoco's Continuation 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 - Block 16: Conoco's "Green" Oil Strategy (D) should strive to include more intangible value offerings along with its core products and services.
Increasing silos among functional specialists
– The organizational structure of Conoco's Continuation is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Conoco's Continuation needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Conoco's Continuation to focus more on services rather than just following the product oriented approach.
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 Conoco's Continuation supply chain. Even after few cautionary changes mentioned in the HBR case study - Block 16: Conoco's "Green" Oil Strategy (D), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Conoco's Continuation vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Block 16: Conoco's "Green" Oil Strategy (D) HBR case study mentions - Conoco's Continuation 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 Block 16: Conoco's "Green" Oil Strategy (D) | 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 Block 16: Conoco's "Green" Oil Strategy (D) are -
Learning at scale
– Online learning technologies has now opened space for Conoco's Continuation 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Conoco's Continuation 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.
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 Conoco's Continuation in the consumer business. Now Conoco's Continuation can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Conoco's Continuation 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 Conoco's Continuation to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Conoco's Continuation 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
– Conoco's Continuation 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.
Using analytics as competitive advantage
– Conoco's Continuation 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 Block 16: Conoco's "Green" Oil Strategy (D) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Conoco's Continuation to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Conoco's Continuation can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Conoco's Continuation is facing challenges because of the dominance of functional experts in the organization. Block 16: Conoco's "Green" Oil Strategy (D) case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Conoco's Continuation 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, Block 16: Conoco's "Green" Oil Strategy (D), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Conoco's Continuation 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. Conoco's Continuation 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.
Building a culture of innovation
– managers at Conoco's Continuation 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.
Developing new processes and practices
– Conoco's Continuation 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.
Threats Block 16: Conoco's "Green" Oil Strategy (D) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Block 16: Conoco's "Green" Oil Strategy (D) are -
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 Conoco's Continuation business can come under increasing regulations regarding data privacy, data security, etc.
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. Conoco's Continuation can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Stagnating economy with rate increase
– Conoco's Continuation 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
– Conoco's Continuation 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.
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. Conoco's Continuation 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, Conoco's Continuation 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 Block 16: Conoco's "Green" Oil Strategy (D) .
Increasing wage structure of Conoco's Continuation
– 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 Conoco's Continuation.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Conoco's Continuation 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.
Shortening product life cycle
– it is one of the major threat that Conoco's Continuation is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Conoco's Continuation with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Environmental challenges
– Conoco's Continuation 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. Conoco's Continuation can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Weighted SWOT Analysis of Block 16: Conoco's "Green" Oil Strategy (D) 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 Block 16: Conoco's "Green" Oil Strategy (D) 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 Block 16: Conoco's "Green" Oil Strategy (D) 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 Block 16: Conoco's "Green" Oil Strategy (D) 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 Block 16: Conoco's "Green" Oil Strategy (D) 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 Conoco's Continuation needs to make to build a sustainable competitive advantage.
