FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team
Confidential Instructions for Fresh Air Negotiation Team for product #PON233.Two-party or two-team, multi-issue, integrative/distributive negotiation between representatives of a new low-cost airline and a potential headquarters city over an incentives package and airport facilities. Fresh Air, a new low-cost airline, is looking for a headquarters city. It is negotiating with the city of Boston, its top choice for a headquarters location, over an incentive package and airport facilities. Fresh Air plans to build on the brand reputation of its parent airline, which stands for innovation, fun, unparalleled customer service, and empowered employees. It believes that a unique corporate culture and happy customers will allow it to charge lower prices, to fill its planes, and to run profitable operations. Boston seeks to reinvent itself as a center of American business after years of business decline. The opening of a low-cost carrier would be an important part of this effort. However, in these tight fiscal times, Boston is limited financially. This is a role play case.
Swot Analysis of "FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team" written by Candace Modlin, Robert C. Bordone includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Fresh Air facing as an external strategic factors. Some of the topics covered in FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team case study are - Strategic Management Strategies, International business, Negotiations, Operations management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team casestudy better are - – challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models,
increasing household debt because of falling income levels, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Fresh Air, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Fresh Air 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 FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team can be done for the following purposes –
1. Strategic planning using facts provided in FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team case study
2. Improving business portfolio management of Fresh Air
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 Fresh Air
Strengths FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Fresh Air in FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team Harvard Business Review case study are -
Diverse revenue streams
– Fresh Air is present in almost all the verticals within the industry. This has provided firm in FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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
– FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team firm has clearly differentiated products in the market place. This has enabled Fresh Air to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Fresh Air to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Fresh Air has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Fresh Air has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High switching costs
– The high switching costs that Fresh Air 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
– Fresh Air has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Fresh Air to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Fresh Air has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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
– Fresh Air 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 Candace Modlin, Robert C. Bordone 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.
Innovation driven organization
– Fresh Air is one of the most innovative firm in sector. Manager in FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Fresh Air in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Strategy & Execution field
– Fresh Air 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 Fresh Air 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
– Fresh Air is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Fresh Air 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 Fresh Air is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team are -
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 Fresh Air supply chain. Even after few cautionary changes mentioned in the HBR case study - FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Fresh Air vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Fresh Air is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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 bargaining power of channel partners
– Because of the regulatory requirements, Candace Modlin, Robert C. Bordone suggests that, Fresh Air 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.
Capital Spending Reduction
– Even during the low interest decade, Fresh Air 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team, in the dynamic environment Fresh Air has struggled to respond to the nimble upstart competition. Fresh Air has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Fresh Air is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Fresh Air needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Fresh Air to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Fresh Air 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team, is just above the industry average. Fresh Air 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.
Lack of clear differentiation of Fresh Air products
– To increase the profitability and margins on the products, Fresh Air needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Fresh Air has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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 Fresh Air has relatively successful track record of launching new products.
Opportunities FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team | 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 FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Fresh Air 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.
Learning at scale
– Online learning technologies has now opened space for Fresh Air 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Fresh Air 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, FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Fresh Air 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.
Better consumer reach
– The expansion of the 5G network will help Fresh Air to increase its market reach. Fresh Air 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.
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. Fresh Air can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Fresh Air 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.
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 Fresh Air in the consumer business. Now Fresh Air can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Fresh Air has opened avenues for new revenue streams for the organization in the industry. This can help Fresh Air to build a more holistic ecosystem as suggested in the FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team case study. Fresh Air can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Leveraging digital technologies
– Fresh Air 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Fresh Air is facing challenges because of the dominance of functional experts in the organization. FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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.
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. Fresh Air 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. Fresh Air 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Fresh Air 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.
Threats FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team are -
Stagnating economy with rate increase
– Fresh Air 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.
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.
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. Fresh Air needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Consumer confidence and its impact on Fresh Air 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Fresh Air 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. Fresh Air 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 Fresh Air is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Fresh Air in the Strategy & Execution sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Fresh Air has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Fresh Air 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 FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team, Fresh Air 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 .
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. Fresh Air can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Fresh Air 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Fresh Air 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 FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team .
Weighted SWOT Analysis of FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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 FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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 FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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 FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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 FRESH AIR - Confidential Instructions for Fresh Air Negotiation Team 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 Fresh Air needs to make to build a sustainable competitive advantage.