Siemens CerberusEco in China: Introducing low-frills products in a high-quality company SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Siemens CerberusEco in China: Introducing low-frills products in a high-quality company
The case is set in November 2007. Matthias Rebellius, head of the business unit Fire Safety and Security Products, has to make a decision about the China strategy for the fire systems unit. Siemens has a very strong position globally in fire systems. Especially in developed markets, in the so-called M1 segments, Siemens is often number one or two. But worldwide and especially in China, the so-called M2 and M3 markets (Siemens terminology) had strong growth, but Siemens was not very well positioned in these segments of the market. The case begins with a short introduction outlining the situation. It then gives a detailed background on Siemens, especially the operating division Building Technologies (BT), and within BT the business unit Fire Safety & Security Products (FS). The case illustrates that the BT division was mainly active in mature, developed markets with slow growth rates. At the same time, there was an aggressive goal of achieving annual growth rates of more than five percent with an EBIT margin of 7 to 10%.
Swot Analysis of "Siemens CerberusEco in China: Introducing low-frills products in a high-quality company" written by Martin Kupp, Olaf Ploetner includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Siemens Bt facing as an external strategic factors. Some of the topics covered in Siemens CerberusEco in China: Introducing low-frills products in a high-quality company case study are - Strategic Management Strategies, Competitive strategy, Marketing, Sales and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Siemens CerberusEco in China: Introducing low-frills products in a high-quality company casestudy better are - – geopolitical disruptions, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, supply chains are disrupted by pandemic , there is backlash against globalization, increasing transportation and logistics costs, central banks are concerned over increasing inflation,
increasing household debt because of falling income levels, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Siemens CerberusEco in China: Introducing low-frills products in a high-quality company
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Siemens CerberusEco in China: Introducing low-frills products in a high-quality company case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Siemens Bt, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Siemens Bt 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 Siemens CerberusEco in China: Introducing low-frills products in a high-quality company can be done for the following purposes –
1. Strategic planning using facts provided in Siemens CerberusEco in China: Introducing low-frills products in a high-quality company case study
2. Improving business portfolio management of Siemens Bt
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 Siemens Bt
Strengths Siemens CerberusEco in China: Introducing low-frills products in a high-quality company | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Siemens Bt in Siemens CerberusEco in China: Introducing low-frills products in a high-quality company Harvard Business Review case study are -
Analytics focus
– Siemens Bt 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 Martin Kupp, Olaf Ploetner can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Ability to lead change in Strategy & Execution field
– Siemens Bt 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 Siemens Bt in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Siemens Bt is one of the leading recruiters in the industry. Managers in the Siemens CerberusEco in China: Introducing low-frills products in a high-quality company are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Siemens Bt
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Siemens Bt does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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.
Highly skilled collaborators
– Siemens Bt 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 Siemens CerberusEco in China: Introducing low-frills products in a high-quality company HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Diverse revenue streams
– Siemens Bt is present in almost all the verticals within the industry. This has provided firm in Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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.
Sustainable margins compare to other players in Strategy & Execution industry
– Siemens CerberusEco in China: Introducing low-frills products in a high-quality company firm has clearly differentiated products in the market place. This has enabled Siemens Bt to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Siemens Bt to invest into research and development (R&D) and innovation.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Siemens Bt digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Siemens Bt 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.
Superior customer experience
– The customer experience strategy of Siemens Bt 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)
– Siemens Bt 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 Siemens CerberusEco in China: Introducing low-frills products in a high-quality company - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Siemens Bt is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Siemens CerberusEco in China: Introducing low-frills products in a high-quality company | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Siemens CerberusEco in China: Introducing low-frills products in a high-quality company are -
Capital Spending Reduction
– Even during the low interest decade, Siemens Bt 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 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 Siemens Bt supply chain. Even after few cautionary changes mentioned in the HBR case study - Siemens CerberusEco in China: Introducing low-frills products in a high-quality company, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Siemens Bt vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Siemens CerberusEco in China: Introducing low-frills products in a high-quality company, in the dynamic environment Siemens Bt has struggled to respond to the nimble upstart competition. Siemens Bt has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Siemens Bt 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.
Slow decision making process
– As mentioned earlier in the report, Siemens Bt 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. Siemens Bt 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.
Products dominated business model
– Even though Siemens Bt 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 - Siemens CerberusEco in China: Introducing low-frills products in a high-quality company should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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 Siemens Bt 's lucrative customers.
Need for greater diversity
– Siemens Bt 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.
Lack of clear differentiation of Siemens Bt products
– To increase the profitability and margins on the products, Siemens Bt needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Siemens Bt is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Siemens Bt needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Siemens Bt to focus more on services rather than just following the product oriented approach.
Low market penetration in new markets
– Outside its home market of Siemens Bt, firm in the HBR case study Siemens CerberusEco in China: Introducing low-frills products in a high-quality company needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Siemens CerberusEco in China: Introducing low-frills products in a high-quality company | 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 Siemens CerberusEco in China: Introducing low-frills products in a high-quality company are -
Building a culture of innovation
– managers at Siemens Bt 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.
Learning at scale
– Online learning technologies has now opened space for Siemens Bt 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 Siemens Bt in the consumer business. Now Siemens Bt can target international markets with far fewer capital restrictions requirements than the existing system.
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. Siemens Bt 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. Siemens Bt 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Siemens Bt is facing challenges because of the dominance of functional experts in the organization. Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Siemens Bt can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Siemens Bt 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.
Leveraging digital technologies
– Siemens Bt 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Siemens Bt 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 Siemens Bt to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Siemens Bt 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Siemens Bt 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, Siemens CerberusEco in China: Introducing low-frills products in a high-quality company, 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
– Siemens Bt 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 Siemens Bt can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Siemens CerberusEco in China: Introducing low-frills products in a high-quality company External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Siemens CerberusEco in China: Introducing low-frills products in a high-quality company are -
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 Siemens Bt.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Siemens Bt 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.
Consumer confidence and its impact on Siemens Bt 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.
Environmental challenges
– Siemens Bt 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. Siemens Bt can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Shortening product life cycle
– it is one of the major threat that Siemens Bt is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, 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.
Stagnating economy with rate increase
– Siemens Bt 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.
High dependence on third party suppliers
– Siemens Bt 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.
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 Siemens Bt business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Siemens Bt with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Siemens Bt needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Siemens CerberusEco in China: Introducing low-frills products in a high-quality company, Siemens Bt 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 .
Weighted SWOT Analysis of Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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 Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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 Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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 Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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 Siemens CerberusEco in China: Introducing low-frills products in a high-quality company 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 Siemens Bt needs to make to build a sustainable competitive advantage.
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