Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study SWOT Analysis Solution
Case Study Description of Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A
This case describes the evolution of IT management at Alcan during the period from 2006-2007. At that time, IT governance and the IT function itself were undergoing a complete transformation. The case follows the Vice-President of Corporate Information Technology from the time of his arrival at Alcan: his observations on the current state of IT management, his appointment to the position of Chief Information Officer and the development of his new strategic plan for IT management. Part A presents the main features and challenges of IT management at Alcan up until the middle of 2006. Part B continues with the main concepts and elements of the CIO's new strategic plan for IT management. Students are encouraged to reflect on the characteristics, implications and challenges represented by IT management in a large global organization.
Swot Analysis of "Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A" written by Line Dube, Carmen Bernier, Vital Roy includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Alcan Management facing as an external strategic factors. Some of the topics covered in Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A case study are - Strategic Management Strategies, Operations management, Strategy and Technology & Operations.
Some of the macro environment factors that can be used to understand the Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A casestudy better are - – wage bills are increasing, geopolitical disruptions, there is backlash against globalization, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, increasing household debt because of falling income levels,
there is increasing trade war between United States & China, technology disruption, etc
Introduction to SWOT Analysis of Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Alcan Management, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Alcan Management 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A can be done for the following purposes –
1. Strategic planning using facts provided in Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A case study
2. Improving business portfolio management of Alcan Management
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 Alcan Management
Strengths Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Alcan Management in Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A Harvard Business Review case study are -
Strong track record of project management
– Alcan Management is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Alcan Management
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Alcan Management does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Technology & Operations industry
– Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A firm has clearly differentiated products in the market place. This has enabled Alcan Management to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Alcan Management to invest into research and development (R&D) and innovation.
Analytics focus
– Alcan Management 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 Line Dube, Carmen Bernier, Vital Roy 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.
Learning organization
- Alcan Management 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 Alcan Management is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Alcan Management is present in almost all the verticals within the industry. This has provided firm in Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Innovation driven organization
– Alcan Management is one of the most innovative firm in sector. Manager in Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High brand equity
– Alcan Management has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Alcan Management to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Alcan Management 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.
Low bargaining power of suppliers
– Suppliers of Alcan Management in the sector have low bargaining power. Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Alcan Management to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Alcan Management has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Alcan Management 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.
Training and development
– Alcan Management has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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.
Weaknesses Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A are -
Interest costs
– Compare to the competition, Alcan Management 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.
High cash cycle compare to competitors
Alcan Management 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.
Low market penetration in new markets
– Outside its home market of Alcan Management, firm in the HBR case study Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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 Alcan Management 's lucrative customers.
Need for greater diversity
– Alcan Management 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A, in the dynamic environment Alcan Management has struggled to respond to the nimble upstart competition. Alcan Management has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Alcan Management 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.
Increasing silos among functional specialists
– The organizational structure of Alcan Management is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Alcan Management needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Alcan Management to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Line Dube, Carmen Bernier, Vital Roy suggests that, Alcan Management 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.
No frontier risks strategy
– After analyzing the HBR case study Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A, it seems that company is thinking about the frontier risks that can impact Technology & Operations strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on 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 Alcan Management supply chain. Even after few cautionary changes mentioned in the HBR case study - Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Alcan Management vulnerable to further global disruptions in South East Asia.
Opportunities Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A | 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Alcan Management is facing challenges because of the dominance of functional experts in the organization. Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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.
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. Alcan Management can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Alcan Management 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Alcan Management can use these opportunities to build new business models that can help the communities that Alcan Management operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Learning at scale
– Online learning technologies has now opened space for Alcan Management 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.
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. Alcan Management can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Alcan Management has opened avenues for new revenue streams for the organization in the industry. This can help Alcan Management to build a more holistic ecosystem as suggested in the Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A case study. Alcan Management can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Alcan Management 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.
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 Alcan Management in the consumer business. Now Alcan Management can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Alcan Management 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Alcan Management 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 Alcan Management to hire the very best people irrespective of their geographical location.
Manufacturing automation
– Alcan Management 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.
Buying journey improvements
– Alcan Management can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A are -
Consumer confidence and its impact on Alcan Management 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.
Environmental challenges
– Alcan Management 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. Alcan Management 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A, Alcan Management may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Technology acceleration in Forth Industrial Revolution
– Alcan Management has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Alcan Management 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.
Increasing wage structure of Alcan Management
– 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 Alcan Management.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Alcan Management 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A .
Regulatory challenges
– Alcan Management 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.
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.
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 Alcan Management 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 Alcan Management in the Technology & Operations sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Alcan Management with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Alcan Management 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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 Taking on the Challenge of IT Management in a Global Business Context: The Alcan Case - Part A 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 Alcan Management needs to make to build a sustainable competitive advantage.
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