HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention
This case study provides an illustration of how the intersection of new digital technologies--mobile devices, cloud computing, and online collaboration--is now transforming the way organizations will conduct business in the future. In late 2014, faced with the challenges of the inherent inefficiencies of operating within a $6.8 billion corporation--with over 110,000 employees located across 31 countries--and contending within the hyper-competitive $1 trillion global IT services industry, divisional executives at India-based HCL Technologies took the initiative to launch ""Starting Point,"" an internal centralized digital platform, for two of its key verticals -- Life Sciences/Health Care and Public Services -- that made up 20 percent of the company's revenue. Realizing that many of its current employees were already leading ""digital lives"" and were now almost always connected to their personal handheld devices, this new centralized digital platform had two key goals by making company data more readily-available on mobile phones and tablets: 1) to enhance the new hire on-boarding process and 2) to empower employees so that they could have more-effective customer discussions that would ultimately lead to more business-to-business sales. By making this transition from analog to digital, HCL Technologies executives believed that Starting Point would improve organizational agility, hasten internal decision making and increase employee efficiencies. This case tells the Starting Point story in three parts: Recognition of the need for a centralized digital platform and mobile strategy; execution of the initial digital platform over a six-week period; and an evaluation of the digital platform's benefits. The case also describes how the Starting Point project benefitted from HCL's entrepreneurial culture, which has been part of the company's DNA since its founding in 1976.
Swot Analysis of "HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention" written by Solomon Darwin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Digital Hcl's facing as an external strategic factors. Some of the topics covered in HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention case study are - Strategic Management Strategies, Corporate governance, Developing employees, Entrepreneurship, Innovation, Leadership, Leading teams, Networking, Sales, Technology and Technology & Operations.
Some of the macro environment factors that can be used to understand the HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention casestudy better are - – increasing energy prices, challanges to central banks by blockchain based private currencies, wage bills are increasing, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, increasing household debt because of falling income levels, increasing government debt because of Covid-19 spendings,
supply chains are disrupted by pandemic , there is backlash against globalization, etc
Introduction to SWOT Analysis of HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Digital Hcl's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Digital Hcl's 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention can be done for the following purposes –
1. Strategic planning using facts provided in HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention case study
2. Improving business portfolio management of Digital Hcl's
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 Digital Hcl's
Strengths HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Digital Hcl's in HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention Harvard Business Review case study are -
Organizational Resilience of Digital Hcl's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Digital Hcl's 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 Digital Hcl's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Digital Hcl's is one of the most innovative firm in sector. Manager in HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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.
High brand equity
– Digital Hcl's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Digital Hcl's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Learning organization
- Digital Hcl's 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 Digital Hcl's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Digital Hcl's is one of the leading recruiters in the industry. Managers in the HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Digital Hcl's 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.
High switching costs
– The high switching costs that Digital Hcl's 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 Digital Hcl's in the sector have low bargaining power. HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Digital Hcl's to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Digital Hcl's 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Technology & Operations field
– Digital Hcl's is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Digital Hcl's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention, it seems that the employees of Digital Hcl's 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.
Capital Spending Reduction
– Even during the low interest decade, Digital Hcl's 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.
High cash cycle compare to competitors
Digital Hcl's 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.
Aligning sales with marketing
– It come across in the case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention can leverage the sales team experience to cultivate customer relationships as Digital Hcl's is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Solomon Darwin suggests that, Digital Hcl's 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.
Increasing silos among functional specialists
– The organizational structure of Digital Hcl's is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Digital Hcl's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Digital Hcl's to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Digital Hcl's 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.
Low market penetration in new markets
– Outside its home market of Digital Hcl's, firm in the HBR case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 Digital Hcl's supply chain. Even after few cautionary changes mentioned in the HBR case study - HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Digital Hcl's vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Digital Hcl's 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention, is just above the industry average. Digital Hcl's needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Opportunities HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention | 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Digital Hcl's 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 Digital Hcl's to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Digital Hcl's is facing challenges because of the dominance of functional experts in the organization. HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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.
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. Digital Hcl's 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. Digital Hcl's 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Digital Hcl's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Digital Hcl's 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Digital Hcl's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Digital Hcl's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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.
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. Digital Hcl's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Digital Hcl's 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Digital Hcl's can use these opportunities to build new business models that can help the communities that Digital Hcl's operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Better consumer reach
– The expansion of the 5G network will help Digital Hcl's to increase its market reach. Digital Hcl's 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Digital Hcl's 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.
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. Digital Hcl's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Digital Hcl's 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.
Threats HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 Digital Hcl's business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Digital Hcl's 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 Digital Hcl's 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.
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.
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 Digital Hcl's.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Digital Hcl's can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention .
Increasing wage structure of Digital Hcl's
– 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 Digital Hcl's.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Digital Hcl's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Digital Hcl's is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Digital Hcl's 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.
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 Digital Hcl's in the Technology & Operations sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Digital Hcl's 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 Digital Hcl's needs to make to build a sustainable competitive advantage.
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