EMMICO: How to Improve Inventory Turns SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of EMMICO: How to Improve Inventory Turns
EMMICO has just acquired one of its suppliers and is rapidly shedding employees as it goes about trying to integrate the companies and the supplier's legacy system. The organization has asked a Tauber Institute for Global Operations intern team to seek solutions to the operations problems facing the newly organized company. The team is tasked with increasing the company's economic value index by increasing inventory turns and eliminating an external warehouse. They have a tough road ahead.
Swot Analysis of "EMMICO: How to Improve Inventory Turns" written by Prakash Sathe includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Emmico Inventory facing as an external strategic factors. Some of the topics covered in EMMICO: How to Improve Inventory Turns case study are - Strategic Management Strategies, and Technology & Operations.
Some of the macro environment factors that can be used to understand the EMMICO: How to Improve Inventory Turns casestudy better are - – geopolitical disruptions, increasing household debt because of falling income levels, increasing energy prices, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, increasing government debt because of Covid-19 spendings, wage bills are increasing,
increasing commodity prices, there is backlash against globalization, etc
Introduction to SWOT Analysis of EMMICO: How to Improve Inventory Turns
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in EMMICO: How to Improve Inventory Turns case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Emmico Inventory, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Emmico Inventory 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 EMMICO: How to Improve Inventory Turns can be done for the following purposes –
1. Strategic planning using facts provided in EMMICO: How to Improve Inventory Turns case study
2. Improving business portfolio management of Emmico Inventory
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 Emmico Inventory
Strengths EMMICO: How to Improve Inventory Turns | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Emmico Inventory in EMMICO: How to Improve Inventory Turns Harvard Business Review case study are -
Organizational Resilience of Emmico Inventory
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Emmico Inventory does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Emmico Inventory in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Emmico Inventory 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 Emmico Inventory is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in EMMICO: How to Improve Inventory Turns Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Technology & Operations industry
– EMMICO: How to Improve Inventory Turns firm has clearly differentiated products in the market place. This has enabled Emmico Inventory to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Emmico Inventory to invest into research and development (R&D) and innovation.
High brand equity
– Emmico Inventory has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Emmico Inventory to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Emmico Inventory in the sector have low bargaining power. EMMICO: How to Improve Inventory Turns has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Emmico Inventory to manage not only supply disruptions but also source products at highly competitive prices.
Innovation driven organization
– Emmico Inventory is one of the most innovative firm in sector. Manager in EMMICO: How to Improve Inventory Turns Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Emmico Inventory digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Emmico Inventory 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.
Strong track record of project management
– Emmico Inventory is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Emmico Inventory 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.
Highly skilled collaborators
– Emmico Inventory 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 EMMICO: How to Improve Inventory Turns HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Emmico Inventory is one of the leading recruiters in the industry. Managers in the EMMICO: How to Improve Inventory Turns are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses EMMICO: How to Improve Inventory Turns | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of EMMICO: How to Improve Inventory Turns are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Emmico Inventory is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study EMMICO: How to Improve Inventory Turns can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Emmico Inventory, firm in the HBR case study EMMICO: How to Improve Inventory Turns needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Emmico Inventory supply chain. Even after few cautionary changes mentioned in the HBR case study - EMMICO: How to Improve Inventory Turns, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Emmico Inventory vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the EMMICO: How to Improve Inventory Turns 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 Emmico Inventory has relatively successful track record of launching new products.
Products dominated business model
– Even though Emmico Inventory 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 - EMMICO: How to Improve Inventory Turns should strive to include more intangible value offerings along with its core products and services.
Slow decision making process
– As mentioned earlier in the report, Emmico Inventory 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. Emmico Inventory 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.
Interest costs
– Compare to the competition, Emmico Inventory 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study EMMICO: How to Improve Inventory Turns, in the dynamic environment Emmico Inventory has struggled to respond to the nimble upstart competition. Emmico Inventory has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Emmico Inventory is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Emmico Inventory needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Emmico Inventory to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Prakash Sathe suggests that, Emmico Inventory 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.
Aligning sales with marketing
– It come across in the case study EMMICO: How to Improve Inventory Turns 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 EMMICO: How to Improve Inventory Turns can leverage the sales team experience to cultivate customer relationships as Emmico Inventory is planning to shift buying processes online.
Opportunities EMMICO: How to Improve Inventory Turns | 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 EMMICO: How to Improve Inventory Turns are -
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. Emmico Inventory 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. Emmico Inventory 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Emmico Inventory 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.
Building a culture of innovation
– managers at Emmico Inventory 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.
Loyalty marketing
– Emmico Inventory 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Emmico Inventory 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.
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. Emmico Inventory can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Emmico Inventory 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, EMMICO: How to Improve Inventory Turns, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Emmico Inventory 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Emmico Inventory 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 Emmico Inventory to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Emmico Inventory 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.
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. Emmico Inventory can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Emmico Inventory can use these opportunities to build new business models that can help the communities that Emmico Inventory operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Buying journey improvements
– Emmico Inventory can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. EMMICO: How to Improve Inventory Turns 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.
Threats EMMICO: How to Improve Inventory Turns External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study EMMICO: How to Improve Inventory Turns are -
Technology acceleration in Forth Industrial Revolution
– Emmico Inventory has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Emmico Inventory 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.
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. Emmico Inventory can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Emmico Inventory 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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
High dependence on third party suppliers
– Emmico Inventory 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Emmico Inventory 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.
Shortening product life cycle
– it is one of the major threat that Emmico Inventory is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Emmico Inventory needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Technology & Operations industry regulations.
Stagnating economy with rate increase
– Emmico Inventory 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.
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. Emmico Inventory 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 Emmico Inventory.
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 Emmico Inventory business can come under increasing regulations regarding data privacy, data security, etc.
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 Emmico Inventory in the Technology & Operations sector and impact the bottomline of the organization.
Weighted SWOT Analysis of EMMICO: How to Improve Inventory Turns 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 EMMICO: How to Improve Inventory Turns 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 EMMICO: How to Improve Inventory Turns 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 EMMICO: How to Improve Inventory Turns 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 EMMICO: How to Improve Inventory Turns 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 Emmico Inventory needs to make to build a sustainable competitive advantage.
