Services Supply Management: The Next Frontier for Improved Organizational Performance SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Services Supply Management: The Next Frontier for Improved Organizational Performance
Explores how the purchase of services is managed within the organization, the risks associated with current services purchasing practices, and how to improve the professional management of services purchases. Survey data obtained from benchmarking research performed by CAPS Center for Strategic Supply Research reveal that purchasing services is viewed as more difficult than purchasing goods. In addition, while purchasing of services is growing in importance and magnitude, the resources to manage it are not. Accordingly, there are huge opportunities for organizations to improve their services purchasing in terms of cost and value by dedicating more, and perhaps different, resources to services purchasing. Developing an outstanding capability to purchase services, and to manage that purchase, could truly be the next frontier for improved supply chain and organizational performance.
Authors :: Lisa M Ellram, Wendy L Tate, Corey Billington
Swot Analysis of "Services Supply Management: The Next Frontier for Improved Organizational Performance" written by Lisa M Ellram, Wendy L Tate, Corey Billington includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Purchasing Services facing as an external strategic factors. Some of the topics covered in Services Supply Management: The Next Frontier for Improved Organizational Performance case study are - Strategic Management Strategies, Supply chain and Technology & Operations.
Some of the macro environment factors that can be used to understand the Services Supply Management: The Next Frontier for Improved Organizational Performance casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, increasing commodity prices, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs,
competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Services Supply Management: The Next Frontier for Improved Organizational Performance
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Services Supply Management: The Next Frontier for Improved Organizational Performance case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Purchasing Services, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Purchasing Services 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 Services Supply Management: The Next Frontier for Improved Organizational Performance can be done for the following purposes –
1. Strategic planning using facts provided in Services Supply Management: The Next Frontier for Improved Organizational Performance case study
2. Improving business portfolio management of Purchasing Services
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 Purchasing Services
Strengths Services Supply Management: The Next Frontier for Improved Organizational Performance | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Purchasing Services in Services Supply Management: The Next Frontier for Improved Organizational Performance Harvard Business Review case study are -
Highly skilled collaborators
– Purchasing Services 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 Services Supply Management: The Next Frontier for Improved Organizational Performance HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Purchasing Services 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 Purchasing Services is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Services Supply Management: The Next Frontier for Improved Organizational Performance Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Purchasing Services is present in almost all the verticals within the industry. This has provided firm in Services Supply Management: The Next Frontier for Improved Organizational Performance 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.
Ability to recruit top talent
– Purchasing Services is one of the leading recruiters in the industry. Managers in the Services Supply Management: The Next Frontier for Improved Organizational Performance are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Purchasing Services has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Purchasing Services 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 Purchasing Services 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.
Operational resilience
– The operational resilience strategy in the Services Supply Management: The Next Frontier for Improved Organizational Performance 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.
Low bargaining power of suppliers
– Suppliers of Purchasing Services in the sector have low bargaining power. Services Supply Management: The Next Frontier for Improved Organizational Performance has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Purchasing Services to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Purchasing Services digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Purchasing Services has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Superior customer experience
– The customer experience strategy of Purchasing Services in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Purchasing Services has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Services Supply Management: The Next Frontier for Improved Organizational Performance 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.
Cross disciplinary teams
– Horizontal connected teams at the Purchasing Services are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Weaknesses Services Supply Management: The Next Frontier for Improved Organizational Performance | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Services Supply Management: The Next Frontier for Improved Organizational Performance 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 Purchasing Services supply chain. Even after few cautionary changes mentioned in the HBR case study - Services Supply Management: The Next Frontier for Improved Organizational Performance, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Purchasing Services vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Purchasing Services 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.
Lack of clear differentiation of Purchasing Services products
– To increase the profitability and margins on the products, Purchasing Services needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Purchasing Services 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Services Supply Management: The Next Frontier for Improved Organizational Performance, in the dynamic environment Purchasing Services has struggled to respond to the nimble upstart competition. Purchasing Services has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Services Supply Management: The Next Frontier for Improved Organizational Performance 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 Services Supply Management: The Next Frontier for Improved Organizational Performance can leverage the sales team experience to cultivate customer relationships as Purchasing Services is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Services Supply Management: The Next Frontier for Improved Organizational Performance, is just above the industry average. Purchasing Services 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 Purchasing Services 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 - Services Supply Management: The Next Frontier for Improved Organizational Performance should strive to include more intangible value offerings along with its core products and services.
High operating costs
– Compare to the competitors, firm in the HBR case study Services Supply Management: The Next Frontier for Improved Organizational Performance 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 Purchasing Services 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Purchasing Services 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.
Increasing silos among functional specialists
– The organizational structure of Purchasing Services is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Purchasing Services needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Purchasing Services to focus more on services rather than just following the product oriented approach.
Opportunities Services Supply Management: The Next Frontier for Improved Organizational Performance | 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 Services Supply Management: The Next Frontier for Improved Organizational Performance are -
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. Purchasing Services can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Purchasing Services 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Purchasing Services is facing challenges because of the dominance of functional experts in the organization. Services Supply Management: The Next Frontier for Improved Organizational Performance 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Purchasing Services 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 Purchasing Services to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Purchasing Services can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Services Supply Management: The Next Frontier for Improved Organizational Performance 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.
Loyalty marketing
– Purchasing Services 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 Purchasing Services to increase its market reach. Purchasing Services 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.
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 Purchasing Services 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.
Leveraging digital technologies
– Purchasing Services 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Purchasing Services 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. Purchasing Services 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.
Using analytics as competitive advantage
– Purchasing Services 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 Services Supply Management: The Next Frontier for Improved Organizational Performance - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Purchasing Services to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Purchasing Services can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
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 Purchasing Services in the consumer business. Now Purchasing Services can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Services Supply Management: The Next Frontier for Improved Organizational Performance External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Services Supply Management: The Next Frontier for Improved Organizational Performance are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Services Supply Management: The Next Frontier for Improved Organizational Performance, Purchasing Services 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 .
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 Purchasing Services is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Purchasing Services with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Purchasing Services 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.
High dependence on third party suppliers
– Purchasing Services 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.
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 Purchasing Services in the Technology & Operations sector and impact the bottomline of the organization.
Consumer confidence and its impact on Purchasing Services 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. Purchasing Services needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Purchasing Services can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Purchasing Services 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.
Technology acceleration in Forth Industrial Revolution
– Purchasing Services has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Purchasing Services 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.
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. Purchasing Services 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.
Weighted SWOT Analysis of Services Supply Management: The Next Frontier for Improved Organizational Performance 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 Services Supply Management: The Next Frontier for Improved Organizational Performance 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 Services Supply Management: The Next Frontier for Improved Organizational Performance 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 Services Supply Management: The Next Frontier for Improved Organizational Performance 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 Services Supply Management: The Next Frontier for Improved Organizational Performance 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 Purchasing Services needs to make to build a sustainable competitive advantage.
Feel free to connect with us if you need business research.
You can download Excel Template of Case Study Solution & Analysis of Services Supply Management: The Next Frontier for Improved Organizational Performance