Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System
Formed in late 1996, Boeing Australia Ltd. (BAL) was a relatively new company and a global extension of the U.S. firm, the Boeing Co. BAL developed capabilities in the areas of space and communications, site management, and the upgrade and maintenance of military aircraft and equipment. As BAL grew, so did the legacy information system it used for both internal communications and external dealings with customers. BAL, however, faced difficult decisions as it sought to upgrade its procurement systems and processes to improve operations. In early 1999, BAL recruited a new national procurement manager, Russell Menere, whose immediate task was to look for gains in productivity by improving procurement processes, either through cost savings or by reduced processing time. To meet this objective, Menere initiated a number of short-term improvements. These included the rationalization of a large number of BAL's suppliers, improving BAL's relationships with its key suppliers; the introduction of a credit-card purchasing system for low-value, large-volume consumables; and the adoption of electronic ordering processes with BAL's larger suppliers. In 2002, with new opportunities available through e-business technology, Menere needed to decide what BAL's next step should be. Should BAL invest in a new system that would simplify the procurement process across different divisions and support complex interfaces with suppliers? Should BAL continue to sit on the fence and seek short-term improvement tools for integration with its existing legacy systems?
Swot Analysis of "Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System" written by Ali Farhoomand, Peta Ashworth includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bal Bal's facing as an external strategic factors. Some of the topics covered in Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System case study are - Strategic Management Strategies, IT and Technology & Operations.
Some of the macro environment factors that can be used to understand the Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System casestudy better are - – increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, cloud computing is disrupting traditional business models, challanges to central banks by blockchain based private currencies,
increasing household debt because of falling income levels, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bal Bal's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bal Bal'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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System can be done for the following purposes –
1. Strategic planning using facts provided in Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System case study
2. Improving business portfolio management of Bal Bal'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 Bal Bal's
Strengths Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bal Bal's in Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Bal Bal'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.
Superior customer experience
– The customer experience strategy of Bal Bal's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Bal Bal's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bal Bal'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.
Training and development
– Bal Bal's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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.
High brand equity
– Bal Bal's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bal Bal's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Bal Bal'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 Bal Bal's in the sector have low bargaining power. Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bal Bal's to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Bal Bal's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bal Bal's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Bal Bal'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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Bal Bal's is one of the most innovative firm in sector. Manager in Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Bal Bal'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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Bal Bal's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bal Bal'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.
Weaknesses Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System are -
Slow to strategic competitive environment developments
– As Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System HBR case study mentions - Bal Bal's takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bal Bal's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Bal Bal's 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. Bal Bal's 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.
No frontier risks strategy
– After analyzing the HBR case study Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System, 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.
Low market penetration in new markets
– Outside its home market of Bal Bal's, firm in the HBR case study Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Bal Bal'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.
High bargaining power of channel partners
– Because of the regulatory requirements, Ali Farhoomand, Peta Ashworth suggests that, Bal Bal'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 Bal Bal's is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Bal Bal's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bal Bal's to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System can leverage the sales team experience to cultivate customer relationships as Bal Bal's is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System, it seems that the employees of Bal Bal'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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System, in the dynamic environment Bal Bal's has struggled to respond to the nimble upstart competition. Bal Bal's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System | 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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System are -
Better consumer reach
– The expansion of the 5G network will help Bal Bal's to increase its market reach. Bal Bal'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.
Developing new processes and practices
– Bal Bal'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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bal Bal's is facing challenges because of the dominance of functional experts in the organization. Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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.
Loyalty marketing
– Bal Bal's 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.
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 Bal Bal'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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bal Bal'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 Bal Bal's to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bal Bal'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.
Leveraging digital technologies
– Bal Bal's can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Using analytics as competitive advantage
– Bal Bal'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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bal Bal's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Bal Bal'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. Bal Bal'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.
Learning at scale
– Online learning technologies has now opened space for Bal Bal'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.
Buying journey improvements
– Bal Bal's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bal Bal'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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bal Bal'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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bal Bal's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Bal Bal'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 Bal Bal's.
Stagnating economy with rate increase
– Bal Bal'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.
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. Bal Bal'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 Bal Bal's business can come under increasing regulations regarding data privacy, data security, etc.
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.
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, Bal Bal'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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System .
High dependence on third party suppliers
– Bal Bal'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.
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 Bal Bal's in the Technology & Operations sector and impact the bottomline of the organization.
Environmental challenges
– Bal Bal'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. Bal Bal's can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Shortening product life cycle
– it is one of the major threat that Bal Bal's is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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 Boeing Australia Ltd.: Assessing the Merits of Implementing a Sophisticated e-Procurement System 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 Bal Bal's needs to make to build a sustainable competitive advantage.
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