Swot Analysis of "General Electric vs. Westinghouse in Large Turbine Generators (B)" written by Michael E. Porter includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Westinghouse Turbine facing as an external strategic factors. Some of the topics covered in General Electric vs. Westinghouse in Large Turbine Generators (B) case study are - Strategic Management Strategies, Competition, Competitive strategy, Manufacturing, Pricing, Regulation and Strategy & Execution.
Some of the macro environment factors that can be used to understand the General Electric vs. Westinghouse in Large Turbine Generators (B) casestudy better are - – central banks are concerned over increasing inflation, increasing transportation and logistics costs, increasing energy prices, increasing government debt because of Covid-19 spendings, there is backlash against globalization, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy,
there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of General Electric vs. Westinghouse in Large Turbine Generators (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in General Electric vs. Westinghouse in Large Turbine Generators (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Westinghouse Turbine, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Westinghouse Turbine 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 General Electric vs. Westinghouse in Large Turbine Generators (B) can be done for the following purposes –
1. Strategic planning using facts provided in General Electric vs. Westinghouse in Large Turbine Generators (B) case study
2. Improving business portfolio management of Westinghouse Turbine
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 Westinghouse Turbine
Strengths General Electric vs. Westinghouse in Large Turbine Generators (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Westinghouse Turbine in General Electric vs. Westinghouse in Large Turbine Generators (B) Harvard Business Review case study are -
Highly skilled collaborators
– Westinghouse Turbine 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 General Electric vs. Westinghouse in Large Turbine Generators (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Westinghouse Turbine digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Westinghouse Turbine 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.
Analytics focus
– Westinghouse Turbine 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 Michael E. Porter 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.
Superior customer experience
– The customer experience strategy of Westinghouse Turbine in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Westinghouse Turbine 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.
Successful track record of launching new products
– Westinghouse Turbine has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Westinghouse Turbine 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
- Westinghouse Turbine 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 Westinghouse Turbine is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in General Electric vs. Westinghouse in Large Turbine Generators (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Westinghouse Turbine
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Westinghouse Turbine does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Strategy & Execution industry
– General Electric vs. Westinghouse in Large Turbine Generators (B) firm has clearly differentiated products in the market place. This has enabled Westinghouse Turbine to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Westinghouse Turbine to invest into research and development (R&D) and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Westinghouse Turbine 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)
– Westinghouse Turbine 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 General Electric vs. Westinghouse in Large Turbine Generators (B) - 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 General Electric vs. Westinghouse in Large Turbine Generators (B) 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 General Electric vs. Westinghouse in Large Turbine Generators (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of General Electric vs. Westinghouse in Large Turbine Generators (B) are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study General Electric vs. Westinghouse in Large Turbine Generators (B), it seems that the employees of Westinghouse Turbine don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Increasing silos among functional specialists
– The organizational structure of Westinghouse Turbine is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Westinghouse Turbine needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Westinghouse Turbine to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael E. Porter suggests that, Westinghouse Turbine 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.
Interest costs
– Compare to the competition, Westinghouse Turbine 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.
Capital Spending Reduction
– Even during the low interest decade, Westinghouse Turbine 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the General Electric vs. Westinghouse in Large Turbine Generators (B) 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 Westinghouse Turbine has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Westinghouse Turbine is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study General Electric vs. Westinghouse in Large Turbine Generators (B) 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 operating costs
– Compare to the competitors, firm in the HBR case study General Electric vs. Westinghouse in Large Turbine Generators (B) 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 Westinghouse Turbine 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Westinghouse Turbine 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.
Lack of clear differentiation of Westinghouse Turbine products
– To increase the profitability and margins on the products, Westinghouse Turbine needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Westinghouse Turbine supply chain. Even after few cautionary changes mentioned in the HBR case study - General Electric vs. Westinghouse in Large Turbine Generators (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Westinghouse Turbine vulnerable to further global disruptions in South East Asia.
Opportunities General Electric vs. Westinghouse in Large Turbine Generators (B) | 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 General Electric vs. Westinghouse in Large Turbine Generators (B) are -
Manufacturing automation
– Westinghouse Turbine 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Westinghouse Turbine is facing challenges because of the dominance of functional experts in the organization. General Electric vs. Westinghouse in Large Turbine Generators (B) 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.
Buying journey improvements
– Westinghouse Turbine can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. General Electric vs. Westinghouse in Large Turbine Generators (B) 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.
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 Westinghouse Turbine 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. Westinghouse Turbine 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. Westinghouse Turbine 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Westinghouse Turbine can use these opportunities to build new business models that can help the communities that Westinghouse Turbine 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 Westinghouse Turbine 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 Westinghouse Turbine to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Westinghouse Turbine 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.
Creating value in data economy
– The success of analytics program of Westinghouse Turbine has opened avenues for new revenue streams for the organization in the industry. This can help Westinghouse Turbine to build a more holistic ecosystem as suggested in the General Electric vs. Westinghouse in Large Turbine Generators (B) case study. Westinghouse Turbine can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Westinghouse Turbine 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 General Electric vs. Westinghouse in Large Turbine Generators (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Westinghouse Turbine 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 Westinghouse Turbine 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.
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 Westinghouse Turbine in the consumer business. Now Westinghouse Turbine can target international markets with far fewer capital restrictions requirements than the existing system.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Westinghouse Turbine can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats General Electric vs. Westinghouse in Large Turbine Generators (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study General Electric vs. Westinghouse in Large Turbine Generators (B) are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Westinghouse Turbine with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Westinghouse Turbine high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Technology acceleration in Forth Industrial Revolution
– Westinghouse Turbine has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Westinghouse Turbine 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study General Electric vs. Westinghouse in Large Turbine Generators (B), Westinghouse Turbine 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 .
Shortening product life cycle
– it is one of the major threat that Westinghouse Turbine is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Westinghouse Turbine 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.
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 Westinghouse Turbine business can come under increasing regulations regarding data privacy, data security, etc.
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.
Environmental challenges
– Westinghouse Turbine 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. Westinghouse Turbine can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Consumer confidence and its impact on Westinghouse Turbine 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.
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. Westinghouse Turbine can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Westinghouse Turbine 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Westinghouse Turbine 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.
Weighted SWOT Analysis of General Electric vs. Westinghouse in Large Turbine Generators (B) 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 General Electric vs. Westinghouse in Large Turbine Generators (B) 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 General Electric vs. Westinghouse in Large Turbine Generators (B) 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 General Electric vs. Westinghouse in Large Turbine Generators (B) 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 General Electric vs. Westinghouse in Large Turbine Generators (B) 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 Westinghouse Turbine needs to make to build a sustainable competitive advantage.