West Marine: Driving Growth Through Shipshape Supply Chain Management SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of West Marine: Driving Growth Through Shipshape Supply Chain Management
In January 2003, West Marine (the nation's largest boating supply retailer) was on the verge of acquiring its biggest competitor, BoatU.S. Several years earlier, the company had acquired E&B Marine, another boating supply company of a similar size. However, that transaction proved to be too much for the organization to bear. Having nearly doubled its number of stores overnight, West Marine's systems and processes, as well as the experience level of its management team, could not withstand the rapid growth. West Marine's supply chain was especially hard-hit: The company was unable to keep all 72 West Marine and 63 E&B Marine stores amply stocked during the critical peak season. Following the E&B Marine transaction, the company charted a new course, bringing in a deeply experienced management team, initiating a significant cultural change, and repairing systems and processes across the company. On the eve of another major acquisition, West Marine was proud of all that the company had accomplished through its collaborative planning, forecasting, and replenishment program, particularly in the supply chain arena. As the company prepared to ramp up its growth engine again on its way to becoming a $1 billion business, West Marine's executive team wondered what "soft spots" might be discovered within its new and improved infrastructure.
Swot Analysis of "West Marine: Driving Growth Through Shipshape Supply Chain Management" written by Hau Lee, Lyn Denend includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Marine West facing as an external strategic factors. Some of the topics covered in West Marine: Driving Growth Through Shipshape Supply Chain Management case study are - Strategic Management Strategies, Growth strategy, International business, Mergers & acquisitions, Supply chain and Technology & Operations.
Some of the macro environment factors that can be used to understand the West Marine: Driving Growth Through Shipshape Supply Chain Management casestudy better are - – there is backlash against globalization, wage bills are increasing, challanges to central banks by blockchain based private currencies, supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, increasing inequality as vast percentage of new income is going to the top 1%,
increasing household debt because of falling income levels, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of West Marine: Driving Growth Through Shipshape Supply Chain Management
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in West Marine: Driving Growth Through Shipshape Supply Chain Management case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Marine West, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Marine West 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 West Marine: Driving Growth Through Shipshape Supply Chain Management can be done for the following purposes –
1. Strategic planning using facts provided in West Marine: Driving Growth Through Shipshape Supply Chain Management case study
2. Improving business portfolio management of Marine West
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 Marine West
Strengths West Marine: Driving Growth Through Shipshape Supply Chain Management | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Marine West in West Marine: Driving Growth Through Shipshape Supply Chain Management Harvard Business Review case study are -
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Marine West digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Marine West 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.
Low bargaining power of suppliers
– Suppliers of Marine West in the sector have low bargaining power. West Marine: Driving Growth Through Shipshape Supply Chain Management has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Marine West to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Marine West 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.
High brand equity
– Marine West has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Marine West to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Operational resilience
– The operational resilience strategy in the West Marine: Driving Growth Through Shipshape Supply Chain Management 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.
Successful track record of launching new products
– Marine West has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Marine West 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.
Highly skilled collaborators
– Marine West 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 West Marine: Driving Growth Through Shipshape Supply Chain Management HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Marine West 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 West Marine: Driving Growth Through Shipshape Supply Chain Management - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Marine West in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Marine West is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Marine West 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 Marine West is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in West Marine: Driving Growth Through Shipshape Supply Chain Management Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Marine West 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 Hau Lee, Lyn Denend 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.
Weaknesses West Marine: Driving Growth Through Shipshape Supply Chain Management | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of West Marine: Driving Growth Through Shipshape Supply Chain Management are -
Aligning sales with marketing
– It come across in the case study West Marine: Driving Growth Through Shipshape Supply Chain Management 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 West Marine: Driving Growth Through Shipshape Supply Chain Management can leverage the sales team experience to cultivate customer relationships as Marine West is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study West Marine: Driving Growth Through Shipshape Supply Chain Management 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 Marine West 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Marine West, firm in the HBR case study West Marine: Driving Growth Through Shipshape Supply Chain Management needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Interest costs
– Compare to the competition, Marine West 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.
Lack of clear differentiation of Marine West products
– To increase the profitability and margins on the products, Marine West needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Marine West 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.
Slow to strategic competitive environment developments
– As West Marine: Driving Growth Through Shipshape Supply Chain Management HBR case study mentions - Marine West 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study West Marine: Driving Growth Through Shipshape Supply Chain Management, it seems that the employees of Marine West 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 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 Marine West supply chain. Even after few cautionary changes mentioned in the HBR case study - West Marine: Driving Growth Through Shipshape Supply Chain Management, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Marine West vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Marine West 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.
No frontier risks strategy
– After analyzing the HBR case study West Marine: Driving Growth Through Shipshape Supply Chain Management, 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 West Marine: Driving Growth Through Shipshape Supply Chain Management | 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 West Marine: Driving Growth Through Shipshape Supply Chain Management are -
Leveraging digital technologies
– Marine West 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.
Loyalty marketing
– Marine West 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.
Buying journey improvements
– Marine West can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. West Marine: Driving Growth Through Shipshape Supply Chain Management 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Marine West can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Marine West 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.
Using analytics as competitive advantage
– Marine West 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 West Marine: Driving Growth Through Shipshape Supply Chain Management - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Marine West to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Marine West to increase its market reach. Marine West 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Marine West 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, West Marine: Driving Growth Through Shipshape Supply Chain Management, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Learning at scale
– Online learning technologies has now opened space for Marine West 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.
Creating value in data economy
– The success of analytics program of Marine West has opened avenues for new revenue streams for the organization in the industry. This can help Marine West to build a more holistic ecosystem as suggested in the West Marine: Driving Growth Through Shipshape Supply Chain Management case study. Marine West can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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. Marine West can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Marine West 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.
Developing new processes and practices
– Marine West 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.
Threats West Marine: Driving Growth Through Shipshape Supply Chain Management External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study West Marine: Driving Growth Through Shipshape Supply Chain Management are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Marine West will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study West Marine: Driving Growth Through Shipshape Supply Chain Management, Marine West 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 .
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 Marine West.
Increasing wage structure of Marine West
– 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 Marine West.
Stagnating economy with rate increase
– Marine West 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.
Shortening product life cycle
– it is one of the major threat that Marine West is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Marine West with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Marine West 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. Marine West can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Marine West 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 West Marine: Driving Growth Through Shipshape Supply Chain Management .
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.
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. Marine West can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Marine West in the Technology & Operations sector and impact the bottomline of the organization.
Regulatory challenges
– Marine West 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.
Weighted SWOT Analysis of West Marine: Driving Growth Through Shipshape Supply Chain Management 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 West Marine: Driving Growth Through Shipshape Supply Chain Management 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 West Marine: Driving Growth Through Shipshape Supply Chain Management 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 West Marine: Driving Growth Through Shipshape Supply Chain Management 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 West Marine: Driving Growth Through Shipshape Supply Chain Management 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 Marine West needs to make to build a sustainable competitive advantage.
