Case Study Description of Guidant: Cardiac Rhythm Management Business (A)
Examines the choices Guidant must make in research and development spending and new product development. More specifically, CEO Jay Graf considers the payoffs and tradeoffs of using product development skills that he learned in CPI's core business when applied to a complementary business. The company's marketing strategies contribute highly to the discussion.
Authors :: Steven C. Wheelwright, Mikelle F. Eastley
Swot Analysis of "Guidant: Cardiac Rhythm Management Business (A)" written by Steven C. Wheelwright, Mikelle F. Eastley includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Guidant Cpi's facing as an external strategic factors. Some of the topics covered in Guidant: Cardiac Rhythm Management Business (A) case study are - Strategic Management Strategies, Marketing, Organizational structure, Product development and Technology & Operations.
Some of the macro environment factors that can be used to understand the Guidant: Cardiac Rhythm Management Business (A) casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, competitive advantages are harder to sustain because of technology dispersion, cloud computing is disrupting traditional business models, wage bills are increasing, increasing commodity prices, increasing energy prices,
increasing household debt because of falling income levels, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Guidant: Cardiac Rhythm Management Business (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Guidant: Cardiac Rhythm Management Business (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Guidant Cpi's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Guidant Cpi's 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 Guidant: Cardiac Rhythm Management Business (A) can be done for the following purposes –
1. Strategic planning using facts provided in Guidant: Cardiac Rhythm Management Business (A) case study
2. Improving business portfolio management of Guidant Cpi's
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Guidant Cpi's
Strengths Guidant: Cardiac Rhythm Management Business (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Guidant Cpi's in Guidant: Cardiac Rhythm Management Business (A) Harvard Business Review case study are -
Training and development
– Guidant Cpi's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Guidant: Cardiac Rhythm Management Business (A) 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.
Ability to recruit top talent
– Guidant Cpi's is one of the leading recruiters in the industry. Managers in the Guidant: Cardiac Rhythm Management Business (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.
Learning organization
- Guidant Cpi's 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 Guidant Cpi's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Guidant: Cardiac Rhythm Management Business (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Successful track record of launching new products
– Guidant Cpi's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Guidant Cpi's 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.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Guidant Cpi's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Guidant Cpi's 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.
Highly skilled collaborators
– Guidant Cpi's 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 Guidant: Cardiac Rhythm Management Business (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Guidant Cpi's 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 Steven C. Wheelwright, Mikelle F. Eastley 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 Technology & Operations field
– Guidant Cpi's 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 Guidant Cpi's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Guidant Cpi's 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.
Organizational Resilience of Guidant Cpi's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Guidant Cpi's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Guidant Cpi's in the sector have low bargaining power. Guidant: Cardiac Rhythm Management Business (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Guidant Cpi's to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Technology & Operations industry
– Guidant: Cardiac Rhythm Management Business (A) firm has clearly differentiated products in the market place. This has enabled Guidant Cpi's to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Guidant Cpi's to invest into research and development (R&D) and innovation.
Weaknesses Guidant: Cardiac Rhythm Management Business (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Guidant: Cardiac Rhythm Management Business (A) are -
Products dominated business model
– Even though Guidant Cpi's 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 - Guidant: Cardiac Rhythm Management Business (A) should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Guidant Cpi's has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, Guidant Cpi's 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 star products
– The top 2 products and services of the firm as mentioned in the Guidant: Cardiac Rhythm Management Business (A) 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 Guidant Cpi's has relatively successful track record of launching new products.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Guidant: Cardiac Rhythm Management Business (A), in the dynamic environment Guidant Cpi's has struggled to respond to the nimble upstart competition. Guidant Cpi's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Guidant Cpi's 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.
Aligning sales with marketing
– It come across in the case study Guidant: Cardiac Rhythm Management Business (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 Guidant: Cardiac Rhythm Management Business (A) can leverage the sales team experience to cultivate customer relationships as Guidant Cpi's is planning to shift buying processes online.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Guidant Cpi's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Guidant: Cardiac Rhythm Management Business (A) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Guidant Cpi's 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Steven C. Wheelwright, Mikelle F. Eastley suggests that, Guidant Cpi's 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.
Slow decision making process
– As mentioned earlier in the report, Guidant Cpi's 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. Guidant Cpi's 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.
Opportunities Guidant: Cardiac Rhythm Management Business (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 Guidant: Cardiac Rhythm Management Business (A) are -
Creating value in data economy
– The success of analytics program of Guidant Cpi's has opened avenues for new revenue streams for the organization in the industry. This can help Guidant Cpi's to build a more holistic ecosystem as suggested in the Guidant: Cardiac Rhythm Management Business (A) case study. Guidant Cpi's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Building a culture of innovation
– managers at Guidant Cpi's 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 Technology & Operations segment.
Learning at scale
– Online learning technologies has now opened space for Guidant Cpi's 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Guidant Cpi's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Guidant Cpi's to increase its market reach. Guidant Cpi's 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Guidant Cpi's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Guidant Cpi's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Buying journey improvements
– Guidant Cpi's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Guidant: Cardiac Rhythm Management Business (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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Guidant Cpi's 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 Guidant Cpi's to hire the very best people irrespective of their geographical location.
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 Guidant Cpi's 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Guidant Cpi's is facing challenges because of the dominance of functional experts in the organization. Guidant: Cardiac Rhythm Management Business (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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Guidant Cpi's 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, Guidant: Cardiac Rhythm Management Business (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.
Using analytics as competitive advantage
– Guidant Cpi's has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Guidant: Cardiac Rhythm Management Business (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Guidant Cpi's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Guidant: Cardiac Rhythm Management Business (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Guidant: Cardiac Rhythm Management Business (A) are -
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 Guidant Cpi's business can come under increasing regulations regarding data privacy, data security, etc.
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 Guidant Cpi's.
Consumer confidence and its impact on Guidant Cpi's 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.
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. Guidant Cpi's will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Guidant Cpi's in the Technology & Operations industry. The Technology & Operations 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.
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. Guidant Cpi's needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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 Guidant Cpi's in the Technology & Operations sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Guidant Cpi's has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Guidant Cpi's needs to keep up with the evolution of technology in the Technology & Operations 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.
Regulatory challenges
– Guidant Cpi's 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 Technology & Operations industry regulations.
Stagnating economy with rate increase
– Guidant Cpi's 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 Guidant: Cardiac Rhythm Management Business (A), Guidant Cpi's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Guidant Cpi's 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 Guidant: Cardiac Rhythm Management Business (A) .
Weighted SWOT Analysis of Guidant: Cardiac Rhythm Management Business (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 Guidant: Cardiac Rhythm Management Business (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 Guidant: Cardiac Rhythm Management Business (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 Guidant: Cardiac Rhythm Management Business (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 Guidant: Cardiac Rhythm Management Business (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 Guidant Cpi's needs to make to build a sustainable competitive advantage.
