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 - – technology disruption, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, increasing energy prices, digital marketing is dominated by two big players Facebook and Google,
geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, 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 -
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.
Highly skilled collaborators
– Digital Hcl's 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 HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
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.
Training and development
– Digital Hcl's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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.
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.
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.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Digital Hcl's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Digital Hcl's 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.
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.
Sustainable margins compare to other players in Technology & Operations industry
– HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention firm has clearly differentiated products in the market place. This has enabled Digital Hcl's to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Digital Hcl's to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Digital Hcl's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Digital Hcl's has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Ability to 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 -
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.
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.
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.
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.
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.
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.
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.
High operating costs
– Compare to the competitors, firm in the HBR case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention 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 Digital Hcl's 's lucrative customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention, in the dynamic environment Digital Hcl's has struggled to respond to the nimble upstart competition. Digital Hcl's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Digital Hcl's 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.
No frontier risks strategy
– After analyzing the HBR case study HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention, 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.
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 -
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.
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.
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 Digital Hcl's 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.
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.
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.
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.
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 Digital Hcl's in the consumer business. Now Digital Hcl's 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, Digital Hcl's 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, HCL's Digital Open Innovation: Enhancing Business Model Effectiveness through Talent and Customer Acquisition, Development, and Retention, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Developing new processes and practices
– Digital Hcl's 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.
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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Digital Hcl's 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.
Manufacturing automation
– Digital Hcl's can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
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.
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 -
Regulatory challenges
– Digital Hcl's 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.
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.
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.
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.
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.
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.
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. Digital Hcl's needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
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.
Technology acceleration in Forth Industrial Revolution
– Digital Hcl's has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Digital Hcl's 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.
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.
Environmental challenges
– Digital Hcl's 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. Digital Hcl's can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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. Digital Hcl's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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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