Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times
From 2001 to 2003, Singapore International Airlines (SIA) faced triple disasters: the 9/11 terrorist attacks, SARS epidemic and the Iraq war, which forced it to reduce capacity, reform and restructure its wages. Having managed costs like a tight ship, SIA found it difficult to negotiate wage restructuring and retrenchments with its unions. Operating in a rigid regulatory and business environment, the SIA management found it challenging to tweak the seniority-based wage system, and migrate to a more flexible and competitive compensation structure. With lower yield, high-cost branding and intense competition from the full-service global and low-cost carriers, the SIA management explored ways to balance its strategic elements, attain flexibility and sustain wage and cost competitiveness to earn double-digit returns for its shareholders.
Swot Analysis of "Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times" written by D.G. Allampalli, Hesan Ahmad Quazi includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Sia Wage facing as an external strategic factors. Some of the topics covered in Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times case study are - Strategic Management Strategies, International business, Personnel policies, Reorganization, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, increasing transportation and logistics costs, increasing energy prices, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion,
technology disruption, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Sia Wage, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Sia Wage 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 Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times can be done for the following purposes –
1. Strategic planning using facts provided in Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times case study
2. Improving business portfolio management of Sia Wage
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 Sia Wage
Strengths Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Sia Wage in Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Sia Wage in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Sia Wage in the sector have low bargaining power. Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Sia Wage to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Sia Wage is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Sia Wage
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Sia Wage does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Sia Wage 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 D.G. Allampalli, Hesan Ahmad Quazi 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.
Successful track record of launching new products
– Sia Wage has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Sia Wage 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 brand equity
– Sia Wage has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Sia Wage to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Sia Wage digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Sia Wage 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.
Operational resilience
– The operational resilience strategy in the Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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.
Innovation driven organization
– Sia Wage is one of the most innovative firm in sector. Manager in Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Strategy & Execution industry
– Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times firm has clearly differentiated products in the market place. This has enabled Sia Wage to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Sia Wage to invest into research and development (R&D) and innovation.
Learning organization
- Sia Wage 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 Sia Wage is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times are -
High operating costs
– Compare to the competitors, firm in the HBR case study Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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 Sia Wage 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Sia Wage is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Sia Wage 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 Sia Wage products
– To increase the profitability and margins on the products, Sia Wage needs to provide more differentiated products than what it is currently offering in the marketplace.
Skills based hiring
– The stress on hiring functional specialists at Sia Wage 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.
Capital Spending Reduction
– Even during the low interest decade, Sia Wage 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times, it seems that the employees of Sia Wage 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times, in the dynamic environment Sia Wage has struggled to respond to the nimble upstart competition. Sia Wage has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times, is just above the industry average. Sia Wage 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 Sia Wage 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 - Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times HBR case study mentions - Sia Wage 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 Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times | 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 Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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 Sia Wage 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.
Developing new processes and practices
– Sia Wage 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.
Learning at scale
– Online learning technologies has now opened space for Sia Wage 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Sia Wage can use these opportunities to build new business models that can help the communities that Sia Wage operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Sia Wage is facing challenges because of the dominance of functional experts in the organization. Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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. Sia Wage 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. Sia Wage 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Sia Wage 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Sia Wage 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, Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Sia Wage can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Sia Wage 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.
Buying journey improvements
– Sia Wage can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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.
Building a culture of innovation
– managers at Sia Wage 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.
Better consumer reach
– The expansion of the 5G network will help Sia Wage to increase its market reach. Sia Wage 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 Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Sia Wage with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Sia Wage 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.
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.
Shortening product life cycle
– it is one of the major threat that Sia Wage is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Sia Wage 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. Sia Wage can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Sia Wage can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Sia Wage business can come under increasing regulations regarding data privacy, data security, etc.
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. Sia Wage needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Sia Wage has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Sia Wage 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.
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.
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 Sia Wage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times, Sia Wage 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 .
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 Sia Wage in the Strategy & Execution sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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 Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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 Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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 Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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 Singapore International Airlines - Moving to a Flexi-Wage System during Volatile Times 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 Sia Wage needs to make to build a sustainable competitive advantage.
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