The Exxon Valdez Revisited: The Untold Story (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Exxon Valdez Revisited: The Untold Story (A)
Being in charge of cleaning up the March 24, 1989 Exxon Valdez oil spill accident, meant that Otto Harrison, the general manager of Exxon International Alaskan Operations, was there when the storm clouds over the event were thick. Despite years of learning, wisdom, growth, and dealing with success and failure, Harrison had never faced a challenge of this magnitude. He was sure his experiences would be utilized in full force. The questions he thought about included whether three different governing bodies, the state of Alaska, the federal government, and Exxon, a publicly held corporation, could work together toward a common goal-to leave few signs of the biggest oil spill ever to occur in North America. What type of help was most needed now? Would Exxon's plan satisfy the numerous stakeholders? How would the plan be viewed publicly? What impact would the cleanup plan have on Exxon's business? In the (A) case, the Exxon Valdez accident and immediate challenges are described so students can put themselves in Harrison's place to lead through the crisis. The (B) case (epilogue) outlines more problems and includes actions taken to try to clean up the oil as quickly and effectively as they could. The tragedy changed the oil industry in many ways-some of which are described in the epilogue.
Swot Analysis of "The Exxon Valdez Revisited: The Untold Story (A)" written by Gerry Yemen, Erika H. James includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Exxon Valdez facing as an external strategic factors. Some of the topics covered in The Exxon Valdez Revisited: The Untold Story (A) case study are - Strategic Management Strategies, International business, Leadership, Regulation, Risk management and Strategy & Execution.
Some of the macro environment factors that can be used to understand the The Exxon Valdez Revisited: The Untold Story (A) casestudy better are - – there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, technology disruption, increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, there is backlash against globalization, geopolitical disruptions,
cloud computing is disrupting traditional business models, increasing energy prices, etc
Introduction to SWOT Analysis of The Exxon Valdez Revisited: The Untold Story (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Exxon Valdez Revisited: The Untold Story (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Exxon Valdez, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Exxon Valdez operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of The Exxon Valdez Revisited: The Untold Story (A) can be done for the following purposes –
1. Strategic planning using facts provided in The Exxon Valdez Revisited: The Untold Story (A) case study
2. Improving business portfolio management of Exxon Valdez
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 Exxon Valdez
Strengths The Exxon Valdez Revisited: The Untold Story (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Exxon Valdez in The Exxon Valdez Revisited: The Untold Story (A) Harvard Business Review case study are -
Strong track record of project management
– Exxon Valdez is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the The Exxon Valdez Revisited: The Untold Story (A) 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
– Exxon Valdez has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in The Exxon Valdez Revisited: The Untold Story (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Exxon Valdez in the sector have low bargaining power. The Exxon Valdez Revisited: The Untold Story (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Exxon Valdez to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Exxon Valdez 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 Exxon Valdez is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Exxon Valdez Revisited: The Untold Story (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Exxon Valdez 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.
Innovation driven organization
– Exxon Valdez is one of the most innovative firm in sector. Manager in The Exxon Valdez Revisited: The Untold Story (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High brand equity
– Exxon Valdez has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Exxon Valdez to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Exxon Valdez 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 Gerry Yemen, Erika H. James 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 recruit top talent
– Exxon Valdez is one of the leading recruiters in the industry. Managers in the The Exxon Valdez Revisited: The Untold Story (A) 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 Exxon Valdez
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Exxon Valdez does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Exxon Valdez is present in almost all the verticals within the industry. This has provided firm in The Exxon Valdez Revisited: The Untold Story (A) 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.
Weaknesses The Exxon Valdez Revisited: The Untold Story (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Exxon Valdez Revisited: The Untold Story (A) are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Exxon Valdez Revisited: The Untold Story (A), in the dynamic environment Exxon Valdez has struggled to respond to the nimble upstart competition. Exxon Valdez has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to strategic competitive environment developments
– As The Exxon Valdez Revisited: The Untold Story (A) HBR case study mentions - Exxon Valdez 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.
High operating costs
– Compare to the competitors, firm in the HBR case study The Exxon Valdez Revisited: The Untold Story (A) 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 Exxon Valdez 's lucrative customers.
Interest costs
– Compare to the competition, Exxon Valdez 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.
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 Exxon Valdez supply chain. Even after few cautionary changes mentioned in the HBR case study - The Exxon Valdez Revisited: The Untold Story (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Exxon Valdez vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Exxon Valdez is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Exxon Valdez needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Exxon Valdez to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Exxon Valdez products
– To increase the profitability and margins on the products, Exxon Valdez needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study The Exxon Valdez Revisited: The Untold Story (A) that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case The Exxon Valdez Revisited: The Untold Story (A) can leverage the sales team experience to cultivate customer relationships as Exxon Valdez is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Exxon Valdez 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. Exxon Valdez 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.
Skills based hiring
– The stress on hiring functional specialists at Exxon Valdez 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.
Need for greater diversity
– Exxon Valdez 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.
Opportunities The Exxon Valdez Revisited: The Untold Story (A) | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study The Exxon Valdez Revisited: The Untold Story (A) are -
Buying journey improvements
– Exxon Valdez can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Exxon Valdez Revisited: The Untold Story (A) 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.
Better consumer reach
– The expansion of the 5G network will help Exxon Valdez to increase its market reach. Exxon Valdez 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Exxon Valdez 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.
Leveraging digital technologies
– Exxon Valdez 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Exxon Valdez can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Exxon Valdez has opened avenues for new revenue streams for the organization in the industry. This can help Exxon Valdez to build a more holistic ecosystem as suggested in the The Exxon Valdez Revisited: The Untold Story (A) case study. Exxon Valdez can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Exxon Valdez can use these opportunities to build new business models that can help the communities that Exxon Valdez operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Exxon Valdez can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, The Exxon Valdez Revisited: The Untold Story (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Exxon Valdez 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Exxon Valdez is facing challenges because of the dominance of functional experts in the organization. The Exxon Valdez Revisited: The Untold Story (A) 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.
Building a culture of innovation
– managers at Exxon Valdez 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Exxon Valdez can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Exxon Valdez 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. Exxon Valdez 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.
Threats The Exxon Valdez Revisited: The Untold Story (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Exxon Valdez Revisited: The Untold Story (A) are -
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Exxon Valdez 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
– Exxon Valdez 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.
High dependence on third party suppliers
– Exxon Valdez 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.
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 Exxon Valdez.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Exxon Valdez with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Exxon Valdez can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study The Exxon Valdez Revisited: The Untold Story (A) .
Technology acceleration in Forth Industrial Revolution
– Exxon Valdez has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Exxon Valdez 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.
Consumer confidence and its impact on Exxon Valdez demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High 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. Exxon Valdez needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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 Exxon Valdez business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Exxon Valdez 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The Exxon Valdez Revisited: The Untold Story (A), Exxon Valdez 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 The Exxon Valdez Revisited: The Untold Story (A) Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study The Exxon Valdez Revisited: The Untold Story (A) needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study The Exxon Valdez Revisited: The Untold Story (A) is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study The Exxon Valdez Revisited: The Untold Story (A) is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of The Exxon Valdez Revisited: The Untold Story (A) 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 Exxon Valdez needs to make to build a sustainable competitive advantage.