Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry

Must firms compete on all dimensions of value simultaneously? Or can managers pick and choose among market segments and deploy a variety of strategies to meet customer needs? Operational systems cannot simultaneously excel on all dimensions of value--cost, lead time, quality, and flexibility. The authors examine three companies similar in product, geographic location, shop floor equipment, employee skills, and customers; all three firms have survived for at least 20 years and are among the top 25 companies in their industry group. Comparing the three in terms of key strategic advantages, disadvantages, fixed costs, lead time, and employee commitment strongly supports the need to make trade-offs in competing dimensions of value in operations (although all three realize they must satisfy certain industry norms, such as quality and on-time delivery). Thus, not only do trade-offs exist, but they have significant competitive implications--trade-offs are strategic in nature. Eventually a firm hits the "productivity frontier," beyond which it cannot continue to improve all dimensions of performance simultaneously.

Authors :: Mark Pagell, Steve Melnyk, Robert B. Handfield

Topics :: Technology & Operations

Tags :: Productivity, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry" written by Mark Pagell, Steve Melnyk, Robert B. Handfield includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Offs Dimensions facing as an external strategic factors. Some of the topics covered in Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry case study are - Strategic Management Strategies, Productivity and Technology & Operations.

Some of the macro environment factors that can be used to understand the Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, challanges to central banks by blockchain based private currencies, increasing energy prices, wage bills are increasing, cloud computing is disrupting traditional business models, supply chains are disrupted by pandemic , increasing transportation and logistics costs, etc

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Introduction to SWOT Analysis of Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Offs Dimensions, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Offs Dimensions 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry can be done for the following purposes –
1. Strategic planning using facts provided in Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry case study
2. Improving business portfolio management of Offs Dimensions
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 Offs Dimensions

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Strengths Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Offs Dimensions in Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry Harvard Business Review case study are -

Learning organization

- Offs Dimensions 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 Offs Dimensions is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Low bargaining power of suppliers

– Suppliers of Offs Dimensions in the sector have low bargaining power. Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Offs Dimensions to manage not only supply disruptions but also source products at highly competitive prices.

Ability to recruit top talent

– Offs Dimensions is one of the leading recruiters in the industry. Managers in the Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.

High brand equity

– Offs Dimensions has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Offs Dimensions to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Cross disciplinary teams

– Horizontal connected teams at the Offs Dimensions 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.

Strong track record of project management

– Offs Dimensions is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Training and development

– Offs Dimensions has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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.

Diverse revenue streams

– Offs Dimensions is present in almost all the verticals within the industry. This has provided firm in Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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.

High switching costs

– The high switching costs that Offs Dimensions 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.

Ability to lead change in Technology & Operations field

– Offs Dimensions 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 Offs Dimensions in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

Organizational Resilience of Offs Dimensions

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Offs Dimensions does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Highly skilled collaborators

– Offs Dimensions 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 Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

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Weaknesses Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry are -

Increasing silos among functional specialists

– The organizational structure of Offs Dimensions is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Offs Dimensions needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Offs Dimensions to focus more on services rather than just following the product oriented approach.

Compensation and incentives

– The revenue per employee as mentioned in the HBR case study Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry, is just above the industry average. Offs Dimensions 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 dependence on star products

– The top 2 products and services of the firm as mentioned in the Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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 Offs Dimensions has relatively successful track record of launching new products.

Slow decision making process

– As mentioned earlier in the report, Offs Dimensions 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. Offs Dimensions even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.

High bargaining power of channel partners

– Because of the regulatory requirements, Mark Pagell, Steve Melnyk, Robert B. Handfield suggests that, Offs Dimensions 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.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry, it seems that the employees of Offs Dimensions 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.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry, in the dynamic environment Offs Dimensions has struggled to respond to the nimble upstart competition. Offs Dimensions has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Aligning sales with marketing

– It come across in the case study Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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 Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry can leverage the sales team experience to cultivate customer relationships as Offs Dimensions is planning to shift buying processes online.

Interest costs

– Compare to the competition, Offs Dimensions 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.

Products dominated business model

– Even though Offs Dimensions 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 - Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry should strive to include more intangible value offerings along with its core products and services.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Offs Dimensions is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

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Opportunities Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry | 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 Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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. Offs Dimensions 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. Offs Dimensions 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.

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 Offs Dimensions 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.

Buying journey improvements

– Offs Dimensions can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Offs Dimensions 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 Offs Dimensions to hire the very best people irrespective of their geographical location.

Loyalty marketing

– Offs Dimensions 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 Offs Dimensions 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.

Developing new processes and practices

– Offs Dimensions 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Offs Dimensions 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, Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Offs Dimensions can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Offs Dimensions is facing challenges because of the dominance of functional experts in the organization. Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Offs Dimensions can use these opportunities to build new business models that can help the communities that Offs Dimensions operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.

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. Offs Dimensions can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Learning at scale

– Online learning technologies has now opened space for Offs Dimensions 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.

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Threats Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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 Offs Dimensions business can come under increasing regulations regarding data privacy, data security, etc.

Technology acceleration in Forth Industrial Revolution

– Offs Dimensions has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Offs Dimensions 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.

Consumer confidence and its impact on Offs Dimensions demand

– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Offs Dimensions with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Offs Dimensions 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.

Stagnating economy with rate increase

– Offs Dimensions 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.

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.

Regulatory challenges

– Offs Dimensions 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.

Environmental challenges

– Offs Dimensions 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. Offs Dimensions can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.

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.

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 Offs Dimensions.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry, Offs Dimensions 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 .

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 Offs Dimensions in the Technology & Operations sector and impact the bottomline of the organization.

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Weighted SWOT Analysis of Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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 Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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 Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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 Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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 Do Trade-offs Exist in Operations Strategy?: Insights from the Stamping Die Industry 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 Offs Dimensions needs to make to build a sustainable competitive advantage.

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