Herman Miller (A): Innovation by Design SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Herman Miller (A): Innovation by Design
To maximize their effectiveness, color cases should be printed in color.Gary Van Spronsen, president of Miller SQA, has been asked to leave the thriving subsidiary he helped to reinvent to join Herman Miller's corporate initiative on innovation. Miller SQA has pioneered processes new to the Herman Miller organization, such as computer-assisted sales and value chain integration. This case details the innovations that have led to a completely new business model for a previously underserved market and highlights the integration of target customer, product design, manufacturing, and supply chain management. Includes color exhibits.
Swot Analysis of "Herman Miller (A): Innovation by Design" written by Sandra J. Sucher includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Miller Herman facing as an external strategic factors. Some of the topics covered in Herman Miller (A): Innovation by Design case study are - Strategic Management Strategies, Design, Organizational culture, Supply chain and Technology & Operations.
Some of the macro environment factors that can be used to understand the Herman Miller (A): Innovation by Design casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, geopolitical disruptions, increasing commodity prices, increasing energy prices, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China,
increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Herman Miller (A): Innovation by Design
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Herman Miller (A): Innovation by Design case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Miller Herman, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Miller Herman 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 Herman Miller (A): Innovation by Design can be done for the following purposes –
1. Strategic planning using facts provided in Herman Miller (A): Innovation by Design case study
2. Improving business portfolio management of Miller Herman
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 Miller Herman
Strengths Herman Miller (A): Innovation by Design | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Miller Herman in Herman Miller (A): Innovation by Design Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Herman Miller (A): Innovation by Design 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.
Analytics focus
– Miller Herman 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 Sandra J. Sucher 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.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Miller Herman digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Miller Herman 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.
Effective Research and Development (R&D)
– Miller Herman has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Herman Miller (A): Innovation by Design - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Miller Herman is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Miller Herman 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 Herman Miller (A): Innovation by Design HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Miller Herman has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Miller Herman 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.
Ability to recruit top talent
– Miller Herman is one of the leading recruiters in the industry. Managers in the Herman Miller (A): Innovation by Design are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Miller Herman is one of the most innovative firm in sector. Manager in Herman Miller (A): Innovation by Design 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 Technology & Operations industry
– Herman Miller (A): Innovation by Design firm has clearly differentiated products in the market place. This has enabled Miller Herman to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Miller Herman to invest into research and development (R&D) and innovation.
Learning organization
- Miller Herman 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 Miller Herman is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Herman Miller (A): Innovation by Design Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Miller Herman is present in almost all the verticals within the industry. This has provided firm in Herman Miller (A): Innovation by Design 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 Herman Miller (A): Innovation by Design | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Herman Miller (A): Innovation by Design are -
Interest costs
– Compare to the competition, Miller Herman 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.
Products dominated business model
– Even though Miller Herman 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 - Herman Miller (A): Innovation by Design should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Sandra J. Sucher suggests that, Miller Herman 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.
No frontier risks strategy
– After analyzing the HBR case study Herman Miller (A): Innovation by Design, it seems that company is thinking about the frontier risks that can impact Technology & Operations strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High operating costs
– Compare to the competitors, firm in the HBR case study Herman Miller (A): Innovation by Design 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 Miller Herman 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Miller Herman, firm in the HBR case study Herman Miller (A): Innovation by Design needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Miller Herman 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. Miller Herman 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 Miller Herman 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Herman Miller (A): Innovation by Design 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 Miller Herman has relatively successful track record of launching new products.
Need for greater diversity
– Miller Herman 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Miller Herman is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Herman Miller (A): Innovation by Design can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Herman Miller (A): Innovation by Design | 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 Herman Miller (A): Innovation by Design are -
Learning at scale
– Online learning technologies has now opened space for Miller Herman 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. Miller Herman can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Miller Herman can develop new processes and procedures in Technology & Operations 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Miller Herman 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Miller Herman 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, Herman Miller (A): Innovation by Design, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Better consumer reach
– The expansion of the 5G network will help Miller Herman to increase its market reach. Miller Herman 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Miller Herman is facing challenges because of the dominance of functional experts in the organization. Herman Miller (A): Innovation by Design 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.
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 Miller Herman in the consumer business. Now Miller Herman can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Miller Herman 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Miller Herman 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 Miller Herman to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Miller Herman 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.
Using analytics as competitive advantage
– Miller Herman 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 Herman Miller (A): Innovation by Design - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Miller Herman to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Miller Herman can use these opportunities to build new business models that can help the communities that Miller Herman operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Threats Herman Miller (A): Innovation by Design External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Herman Miller (A): Innovation by Design are -
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. Miller Herman needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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 Miller Herman.
Stagnating economy with rate increase
– Miller Herman 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Miller Herman 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Herman Miller (A): Innovation by Design, Miller Herman 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 .
Environmental challenges
– Miller Herman 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. Miller Herman can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Technology acceleration in Forth Industrial Revolution
– Miller Herman has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Miller Herman 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.
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 Miller Herman business can come under increasing regulations regarding data privacy, data security, etc.
Regulatory challenges
– Miller Herman 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.
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.
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. Miller Herman 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.
Increasing wage structure of Miller Herman
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Miller Herman.
High dependence on third party suppliers
– Miller Herman 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.
Weighted SWOT Analysis of Herman Miller (A): Innovation by Design 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 Herman Miller (A): Innovation by Design 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 Herman Miller (A): Innovation by Design 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 Herman Miller (A): Innovation by Design 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 Herman Miller (A): Innovation by Design 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 Miller Herman needs to make to build a sustainable competitive advantage.
