Hong Kong's Container Truckers: The Mid-Stream Fee Dispute SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Hong Kong's Container Truckers: The Mid-Stream Fee Dispute
In November 2000, the eight-member Hong Kong Mid-Stream Operators Association (HKMOA), which controlled 90% of the mid-stream container handling business in Hong Kong, announced that it would charge shippers an extra fee. When the shippers refused to pay that fee, the HKMOA asked the container truck drivers, who delivered the containers to the mid-stream depots, to pay it and then claim it back from the shippers. The truckers refused. A series of industrial actions ensued, and the government, shippers, and liners were involved in subsequent negotiations. The rounds of tussles between the HKMOA and the truckers lasted into 2001. Eventually, the HKMOA won: The truckers had to pay the mid-stream fee, although in many cases, could not recoup it from the shippers. Why did the truckers become the victims of the HKMOA? How could the mid-stream operators win? What could public policy makers do to prevent similar disputes from happening again? What could the truck drivers, who in many cases were self-employed, do to protect themselves from more new charges in the future?
Swot Analysis of "Hong Kong's Container Truckers: The Mid-Stream Fee Dispute" written by Michael J. Enright, Vincent Mak includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hkmoa Truckers facing as an external strategic factors. Some of the topics covered in Hong Kong's Container Truckers: The Mid-Stream Fee Dispute case study are - Strategic Management Strategies, Customers, Government, Negotiations and Technology & Operations.
Some of the macro environment factors that can be used to understand the Hong Kong's Container Truckers: The Mid-Stream Fee Dispute casestudy better are - – increasing transportation and logistics costs, there is increasing trade war between United States & China, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, increasing government debt because of Covid-19 spendings,
increasing commodity prices, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Hong Kong's Container Truckers: The Mid-Stream Fee Dispute
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Hong Kong's Container Truckers: The Mid-Stream Fee Dispute case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hkmoa Truckers, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hkmoa Truckers 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute can be done for the following purposes –
1. Strategic planning using facts provided in Hong Kong's Container Truckers: The Mid-Stream Fee Dispute case study
2. Improving business portfolio management of Hkmoa Truckers
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 Hkmoa Truckers
Strengths Hong Kong's Container Truckers: The Mid-Stream Fee Dispute | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hkmoa Truckers in Hong Kong's Container Truckers: The Mid-Stream Fee Dispute Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Hkmoa Truckers in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Hkmoa Truckers has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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.
Operational resilience
– The operational resilience strategy in the Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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.
Learning organization
- Hkmoa Truckers 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 Hkmoa Truckers is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Hong Kong's Container Truckers: The Mid-Stream Fee Dispute Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Hkmoa Truckers digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hkmoa Truckers 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.
Cross disciplinary teams
– Horizontal connected teams at the Hkmoa Truckers 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.
Analytics focus
– Hkmoa Truckers 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 Michael J. Enright, Vincent Mak 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.
High switching costs
– The high switching costs that Hkmoa Truckers 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.
High brand equity
– Hkmoa Truckers has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hkmoa Truckers to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Hkmoa Truckers in the sector have low bargaining power. Hong Kong's Container Truckers: The Mid-Stream Fee Dispute has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hkmoa Truckers to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Hkmoa Truckers
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hkmoa Truckers does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Hkmoa Truckers is present in almost all the verticals within the industry. This has provided firm in Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hong Kong's Container Truckers: The Mid-Stream Fee Dispute are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hkmoa Truckers has relatively successful track record of launching new products.
Skills based hiring
– The stress on hiring functional specialists at Hkmoa Truckers 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hkmoa Truckers is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Hong Kong's Container Truckers: The Mid-Stream Fee Dispute can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Products dominated business model
– Even though Hkmoa Truckers 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 - Hong Kong's Container Truckers: The Mid-Stream Fee Dispute should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Hkmoa Truckers 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.
Slow decision making process
– As mentioned earlier in the report, Hkmoa Truckers 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. Hkmoa Truckers 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.
High cash cycle compare to competitors
Hkmoa Truckers 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.
Slow to strategic competitive environment developments
– As Hong Kong's Container Truckers: The Mid-Stream Fee Dispute HBR case study mentions - Hkmoa Truckers takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
High operating costs
– Compare to the competitors, firm in the HBR case study Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hkmoa Truckers 's lucrative customers.
Need for greater diversity
– Hkmoa Truckers 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael J. Enright, Vincent Mak suggests that, Hkmoa Truckers 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.
Opportunities Hong Kong's Container Truckers: The Mid-Stream Fee Dispute | 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute are -
Better consumer reach
– The expansion of the 5G network will help Hkmoa Truckers to increase its market reach. Hkmoa Truckers 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.
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. Hkmoa Truckers can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Hkmoa Truckers can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Hkmoa Truckers is facing challenges because of the dominance of functional experts in the organization. Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hkmoa Truckers 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 Hkmoa Truckers 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.
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 Hkmoa Truckers 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hkmoa Truckers 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hkmoa Truckers 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 Hkmoa Truckers to hire the very best people irrespective of their geographical location.
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 Hkmoa Truckers in the consumer business. Now Hkmoa Truckers can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hkmoa Truckers 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, Hong Kong's Container Truckers: The Mid-Stream Fee Dispute, 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
– Hkmoa Truckers 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hkmoa Truckers to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Hkmoa Truckers has opened avenues for new revenue streams for the organization in the industry. This can help Hkmoa Truckers to build a more holistic ecosystem as suggested in the Hong Kong's Container Truckers: The Mid-Stream Fee Dispute case study. Hkmoa Truckers can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Hong Kong's Container Truckers: The Mid-Stream Fee Dispute External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hkmoa Truckers business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Hkmoa Truckers 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.
Environmental challenges
– Hkmoa Truckers 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. Hkmoa Truckers can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Stagnating economy with rate increase
– Hkmoa Truckers 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.
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 Hkmoa Truckers 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute, Hkmoa Truckers 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 .
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. Hkmoa Truckers can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Hkmoa Truckers has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Hkmoa Truckers 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Hkmoa Truckers 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.
Consumer confidence and its impact on Hkmoa Truckers 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Hkmoa Truckers with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Hkmoa Truckers in the Technology & Operations sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hong Kong's Container Truckers: The Mid-Stream Fee Dispute 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 Hkmoa Truckers needs to make to build a sustainable competitive advantage.
