FedEx and Environmental Defense: Building a Hybrid Delivery Fleet SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of FedEx and Environmental Defense: Building a Hybrid Delivery Fleet
In 2000, FedEx Express and Environmental Defense began a collaboration to develop a source of new-generation delivery trucks with dramatically improved fuel efficiency and environmental impact. By 2005, prototypes had been developed by Eaton Corp., which supplied hybrid diesel-electric transmissions, and Freightliner, which integrated the transmissions into the delivery truck chassis. FedEx tested the prototypes and announced that it intended to buy 75 of the new hybrid trucks. Describes the process by which the new trucks were specified and developed and the roles of each of the organizations involved.
Authors :: Erica Plambeck, David W. Hoyt
Topics :: Technology & Operations
Tags :: Government, International business, Product development, Social responsibility, Supply chain, Sustainability, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis
Swot Analysis of "FedEx and Environmental Defense: Building a Hybrid Delivery Fleet" written by Erica Plambeck, David W. Hoyt includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Fedex Trucks facing as an external strategic factors. Some of the topics covered in FedEx and Environmental Defense: Building a Hybrid Delivery Fleet case study are - Strategic Management Strategies, Government, International business, Product development, Social responsibility, Supply chain, Sustainability and Technology & Operations.
Some of the macro environment factors that can be used to understand the FedEx and Environmental Defense: Building a Hybrid Delivery Fleet casestudy better are - – increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, geopolitical disruptions, there is increasing trade war between United States & China,
banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of FedEx and Environmental Defense: Building a Hybrid Delivery Fleet
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in FedEx and Environmental Defense: Building a Hybrid Delivery Fleet case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Fedex Trucks, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Fedex Trucks 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 FedEx and Environmental Defense: Building a Hybrid Delivery Fleet can be done for the following purposes –
1. Strategic planning using facts provided in FedEx and Environmental Defense: Building a Hybrid Delivery Fleet case study
2. Improving business portfolio management of Fedex Trucks
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 Fedex Trucks
Strengths FedEx and Environmental Defense: Building a Hybrid Delivery Fleet | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Fedex Trucks in FedEx and Environmental Defense: Building a Hybrid Delivery Fleet Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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
– Fedex Trucks 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 Erica Plambeck, David W. Hoyt 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.
Sustainable margins compare to other players in Technology & Operations industry
– FedEx and Environmental Defense: Building a Hybrid Delivery Fleet firm has clearly differentiated products in the market place. This has enabled Fedex Trucks to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Fedex Trucks to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Fedex Trucks 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 FedEx and Environmental Defense: Building a Hybrid Delivery Fleet HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Fedex Trucks 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.
Diverse revenue streams
– Fedex Trucks is present in almost all the verticals within the industry. This has provided firm in FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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.
Innovation driven organization
– Fedex Trucks is one of the most innovative firm in sector. Manager in FedEx and Environmental Defense: Building a Hybrid Delivery Fleet Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Fedex Trucks 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.
Low bargaining power of suppliers
– Suppliers of Fedex Trucks in the sector have low bargaining power. FedEx and Environmental Defense: Building a Hybrid Delivery Fleet has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Fedex Trucks to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Fedex Trucks has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Fedex Trucks to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Fedex Trucks is one of the leading recruiters in the industry. Managers in the FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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
– Fedex Trucks has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Fedex Trucks 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.
Weaknesses FedEx and Environmental Defense: Building a Hybrid Delivery Fleet | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of FedEx and Environmental Defense: Building a Hybrid Delivery Fleet are -
High operating costs
– Compare to the competitors, firm in the HBR case study FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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 Fedex Trucks 's lucrative customers.
High cash cycle compare to competitors
Fedex Trucks 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study FedEx and Environmental Defense: Building a Hybrid Delivery Fleet, it seems that the employees of Fedex Trucks don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Low market penetration in new markets
– Outside its home market of Fedex Trucks, firm in the HBR case study FedEx and Environmental Defense: Building a Hybrid Delivery Fleet needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow decision making process
– As mentioned earlier in the report, Fedex Trucks 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. Fedex Trucks 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study FedEx and Environmental Defense: Building a Hybrid Delivery Fleet, in the dynamic environment Fedex Trucks has struggled to respond to the nimble upstart competition. Fedex Trucks has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Fedex Trucks 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, Fedex Trucks is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study FedEx and Environmental Defense: Building a Hybrid Delivery Fleet can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Fedex Trucks 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.
No frontier risks strategy
– After analyzing the HBR case study FedEx and Environmental Defense: Building a Hybrid Delivery Fleet, 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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 Fedex Trucks has relatively successful track record of launching new products.
Opportunities FedEx and Environmental Defense: Building a Hybrid Delivery Fleet | 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 FedEx and Environmental Defense: Building a Hybrid Delivery Fleet are -
Better consumer reach
– The expansion of the 5G network will help Fedex Trucks to increase its market reach. Fedex Trucks 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.
Building a culture of innovation
– managers at Fedex Trucks 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.
Leveraging digital technologies
– Fedex Trucks 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.
Using analytics as competitive advantage
– Fedex Trucks 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 FedEx and Environmental Defense: Building a Hybrid Delivery Fleet - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Fedex Trucks to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Fedex Trucks 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
– Fedex Trucks 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Fedex Trucks is facing challenges because of the dominance of functional experts in the organization. FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Fedex Trucks can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Fedex Trucks can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Fedex Trucks has opened avenues for new revenue streams for the organization in the industry. This can help Fedex Trucks to build a more holistic ecosystem as suggested in the FedEx and Environmental Defense: Building a Hybrid Delivery Fleet case study. Fedex Trucks can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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. Fedex Trucks 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. Fedex Trucks 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Fedex Trucks 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 Fedex Trucks to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Fedex Trucks 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.
Threats FedEx and Environmental Defense: Building a Hybrid Delivery Fleet External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study FedEx and Environmental Defense: Building a Hybrid Delivery Fleet are -
Environmental challenges
– Fedex Trucks 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. Fedex Trucks can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Shortening product life cycle
– it is one of the major threat that Fedex Trucks is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study FedEx and Environmental Defense: Building a Hybrid Delivery Fleet, Fedex Trucks 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 .
Technology acceleration in Forth Industrial Revolution
– Fedex Trucks has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Fedex Trucks 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.
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. Fedex Trucks needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Increasing wage structure of Fedex Trucks
– 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 Fedex Trucks.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
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. Fedex Trucks can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Fedex Trucks in the Technology & Operations sector and impact the bottomline of the organization.
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 Fedex Trucks business can come under increasing regulations regarding data privacy, data security, etc.
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. Fedex Trucks 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.
Regulatory challenges
– Fedex Trucks 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.
Weighted SWOT Analysis of FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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 FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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 FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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 FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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 FedEx and Environmental Defense: Building a Hybrid Delivery Fleet 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 Fedex Trucks needs to make to build a sustainable competitive advantage.
