The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND)
In a six-party negotiation exercise, the TNDA Corp. plans to sell the Elcer Products Division to one of four potential buyers (industrial, financial, U.S., German). This case contains confidential information for the US Industrial ElectroCeramics (US-IND) management role. Challenges include how to set up and implement the most promising sale process, come up with the right deal, and choose the best tactical approach given each party's role and objectives. This negotiation exercise draws on and illustrates the "3-D Negotiation" logic of Lax and Sebenius.
Swot Analysis of "The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND)" written by James K. Sebenius includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Elcer Electroceramics facing as an external strategic factors. Some of the topics covered in The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) case study are - Strategic Management Strategies, Negotiations, Performance measurement and Strategy & Execution.
Some of the macro environment factors that can be used to understand the The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, increasing transportation and logistics costs, increasing energy prices, geopolitical disruptions, increasing government debt because of Covid-19 spendings,
wage bills are increasing, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Elcer Electroceramics, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Elcer Electroceramics 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) can be done for the following purposes –
1. Strategic planning using facts provided in The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) case study
2. Improving business portfolio management of Elcer Electroceramics
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 Elcer Electroceramics
Strengths The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Elcer Electroceramics in The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) Harvard Business Review case study are -
High switching costs
– The high switching costs that Elcer Electroceramics 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.
High brand equity
– Elcer Electroceramics has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Elcer Electroceramics to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Elcer Electroceramics has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) 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.
Diverse revenue streams
– Elcer Electroceramics is present in almost all the verticals within the industry. This has provided firm in The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to lead change in Strategy & Execution field
– Elcer Electroceramics 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 Elcer Electroceramics in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Elcer Electroceramics is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Analytics focus
– Elcer Electroceramics 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 James K. Sebenius 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.
Organizational Resilience of Elcer Electroceramics
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Elcer Electroceramics does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Elcer Electroceramics 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.
Low bargaining power of suppliers
– Suppliers of Elcer Electroceramics in the sector have low bargaining power. The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Elcer Electroceramics to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Elcer Electroceramics 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Elcer Electroceramics has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Elcer Electroceramics 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.
Weaknesses The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) are -
No frontier risks strategy
– After analyzing the HBR case study The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND), 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 cash cycle compare to competitors
Elcer Electroceramics 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND), is just above the industry average. Elcer Electroceramics 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.
Products dominated business model
– Even though Elcer Electroceramics 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 - The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Elcer Electroceramics is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) 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 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 Elcer Electroceramics supply chain. Even after few cautionary changes mentioned in the HBR case study - The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Elcer Electroceramics vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Elcer Electroceramics, firm in the HBR case study The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Elcer Electroceramics 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.
Skills based hiring
– The stress on hiring functional specialists at Elcer Electroceramics has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Increasing silos among functional specialists
– The organizational structure of Elcer Electroceramics is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Elcer Electroceramics needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Elcer Electroceramics to focus more on services rather than just following the product oriented approach.
Slow to strategic competitive environment developments
– As The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) HBR case study mentions - Elcer Electroceramics 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) | 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) are -
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 Elcer Electroceramics 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.
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. Elcer Electroceramics 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. Elcer Electroceramics 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 Elcer Electroceramics 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.
Creating value in data economy
– The success of analytics program of Elcer Electroceramics has opened avenues for new revenue streams for the organization in the industry. This can help Elcer Electroceramics to build a more holistic ecosystem as suggested in the The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) case study. Elcer Electroceramics can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Elcer Electroceramics 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Elcer Electroceramics can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Learning at scale
– Online learning technologies has now opened space for Elcer Electroceramics 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.
Leveraging digital technologies
– Elcer Electroceramics 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.
Buying journey improvements
– Elcer Electroceramics can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) 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.
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 Elcer Electroceramics in the consumer business. Now Elcer Electroceramics can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Elcer Electroceramics 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, The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Elcer Electroceramics 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.
Better consumer reach
– The expansion of the 5G network will help Elcer Electroceramics to increase its market reach. Elcer Electroceramics 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.
Threats The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Elcer Electroceramics 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Elcer Electroceramics with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Elcer Electroceramics 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.
Shortening product life cycle
– it is one of the major threat that Elcer Electroceramics is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Elcer Electroceramics
– 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 Elcer Electroceramics.
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 Elcer Electroceramics business can come under increasing regulations regarding data privacy, data security, etc.
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. Elcer Electroceramics needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Elcer Electroceramics 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) .
Consumer confidence and its impact on Elcer Electroceramics 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.
High dependence on third party suppliers
– Elcer Electroceramics 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.
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. Elcer Electroceramics can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Weighted SWOT Analysis of The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) 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 The Elcer Products Transaction: Confidential Information for US Industrial ElectroCeramics (US-IND) 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 Elcer Electroceramics needs to make to build a sustainable competitive advantage.
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