Case Study Description of Donald Trump Calls Carrier Corporation
This case examines the influence of political pressure on corporate decision-making. It questions whether fidelity to domestic operations ought to be a corporate social responsibility, and thus it challenges the limits of "social responsibility" as a corporate ideal. Specifically, the case focuses on Donald Trump's effort to encourage U.S. companies' domestic operations, through a study of one company's decision to backtrack on a factory relocation plan. In February 2016, the Carrier Corporation (a maker of heating, ventilation, and air-conditioning equipment and a division of United Technologies Corporation) announced a plan to relocate operations of a furnace factory from the United States to Mexico. The case notes that Carrier began to outsource and offshore operations, in an effort to reduce costs, around 1921. While Carrier's previous United States factory closures had garnered major press coverage, the 2016 announcement ramified differently. Days later, then-presidential candidate Donald Trump referenced the relocation in a Facebook post. Soon, Carrier's plan became a touchtone to Trump's anti-globalization and anti-free trade campaign messaging. The case documents that he was not the only candidate or politician to reference Carrier during the 2016 campaign. Still his declaration to "call up the head of Carrier" upon winning the presidency became a stump-speech refrain popular with his audiences, and contrasted with other political figures' more measured language. Ultimately, the case outlines the events set in motion after Trump kept his campaign promise and called Carrier's parent company's CEO one week after his surprise presidential election victory.
Swot Analysis of "Donald Trump Calls Carrier Corporation" written by Andy Zelleke, Brian Tilley includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Carrier Carrier's facing as an external strategic factors. Some of the topics covered in Donald Trump Calls Carrier Corporation case study are - Strategic Management Strategies, Decision making, Government, Influence, Manufacturing, Technology and Global Business.
Some of the macro environment factors that can be used to understand the Donald Trump Calls Carrier Corporation casestudy better are - – increasing transportation and logistics costs, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, increasing household debt because of falling income levels, central banks are concerned over increasing inflation, increasing commodity prices,
wage bills are increasing, geopolitical disruptions, etc
Introduction to SWOT Analysis of Donald Trump Calls Carrier Corporation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Donald Trump Calls Carrier Corporation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Carrier Carrier's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Carrier Carrier'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 Donald Trump Calls Carrier Corporation can be done for the following purposes –
1. Strategic planning using facts provided in Donald Trump Calls Carrier Corporation case study
2. Improving business portfolio management of Carrier Carrier's
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Carrier Carrier's
Strengths Donald Trump Calls Carrier Corporation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Carrier Carrier's in Donald Trump Calls Carrier Corporation Harvard Business Review case study are -
Innovation driven organization
– Carrier Carrier's is one of the most innovative firm in sector. Manager in Donald Trump Calls Carrier Corporation Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Carrier Carrier's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Carrier Carrier's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Carrier Carrier's 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 Andy Zelleke, Brian Tilley 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.
Sustainable margins compare to other players in Global Business industry
– Donald Trump Calls Carrier Corporation firm has clearly differentiated products in the market place. This has enabled Carrier Carrier's to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Carrier Carrier's to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Carrier Carrier's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Carrier Carrier'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.
Operational resilience
– The operational resilience strategy in the Donald Trump Calls Carrier Corporation 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.
Superior customer experience
– The customer experience strategy of Carrier Carrier's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Carrier Carrier'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 Donald Trump Calls Carrier Corporation - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Carrier Carrier's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Donald Trump Calls Carrier Corporation 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Carrier Carrier's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Carrier Carrier'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.
Low bargaining power of suppliers
– Suppliers of Carrier Carrier's in the sector have low bargaining power. Donald Trump Calls Carrier Corporation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Carrier Carrier's to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Carrier Carrier'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 Donald Trump Calls Carrier Corporation HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses Donald Trump Calls Carrier Corporation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Donald Trump Calls Carrier Corporation are -
Products dominated business model
– Even though Carrier Carrier's 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 - Donald Trump Calls Carrier Corporation should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study Donald Trump Calls Carrier Corporation, it seems that company is thinking about the frontier risks that can impact Global Business 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.
Aligning sales with marketing
– It come across in the case study Donald Trump Calls Carrier Corporation 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 Donald Trump Calls Carrier Corporation can leverage the sales team experience to cultivate customer relationships as Carrier Carrier's is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Donald Trump Calls Carrier Corporation 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 Carrier Carrier's 's lucrative customers.
High cash cycle compare to competitors
Carrier Carrier's 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Andy Zelleke, Brian Tilley suggests that, Carrier Carrier'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.
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 Carrier Carrier's supply chain. Even after few cautionary changes mentioned in the HBR case study - Donald Trump Calls Carrier Corporation, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Carrier Carrier's vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Carrier Carrier's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Donald Trump Calls Carrier Corporation can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Donald Trump Calls Carrier Corporation, it seems that the employees of Carrier Carrier'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.
Lack of clear differentiation of Carrier Carrier's products
– To increase the profitability and margins on the products, Carrier Carrier's needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Carrier Carrier's 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.
Opportunities Donald Trump Calls Carrier Corporation | 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 Donald Trump Calls Carrier Corporation are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Carrier Carrier'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 Carrier Carrier's to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Carrier Carrier'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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Carrier Carrier's is facing challenges because of the dominance of functional experts in the organization. Donald Trump Calls Carrier Corporation 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Carrier Carrier'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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Carrier Carrier's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Better consumer reach
– The expansion of the 5G network will help Carrier Carrier's to increase its market reach. Carrier Carrier'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.
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 Carrier Carrier's in the consumer business. Now Carrier Carrier's can target international markets with far fewer capital restrictions requirements than the existing system.
Creating value in data economy
– The success of analytics program of Carrier Carrier's has opened avenues for new revenue streams for the organization in the industry. This can help Carrier Carrier's to build a more holistic ecosystem as suggested in the Donald Trump Calls Carrier Corporation case study. Carrier Carrier's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Carrier Carrier's can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Donald Trump Calls Carrier Corporation, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Carrier Carrier'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. Carrier Carrier'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.
Developing new processes and practices
– Carrier Carrier's can develop new processes and procedures in Global Business 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Carrier Carrier'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 Global Business segment, and it will provide faster access to the consumers.
Manufacturing automation
– Carrier Carrier's can use the latest technology developments to improve its manufacturing and designing process in Global Business 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.
Threats Donald Trump Calls Carrier Corporation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Donald Trump Calls Carrier Corporation are -
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Carrier Carrier's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Carrier Carrier'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.
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 Carrier Carrier's.
Technology acceleration in Forth Industrial Revolution
– Carrier Carrier's has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Carrier Carrier's needs to keep up with the evolution of technology in the Global Business 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.
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. Carrier Carrier's needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
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. Carrier Carrier's 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.
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 Carrier Carrier's business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Carrier Carrier'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 Donald Trump Calls Carrier Corporation .
Shortening product life cycle
– it is one of the major threat that Carrier Carrier's is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Carrier Carrier's needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Global Business 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.
Consumer confidence and its impact on Carrier Carrier's 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.
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 Carrier Carrier's in the Global Business sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Donald Trump Calls Carrier Corporation 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 Donald Trump Calls Carrier Corporation 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 Donald Trump Calls Carrier Corporation 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 Donald Trump Calls Carrier Corporation 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 Donald Trump Calls Carrier Corporation 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 Carrier Carrier's needs to make to build a sustainable competitive advantage.
