Deals on Wheels Inc. SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Deals on Wheels Inc.
Students tend to think they know what a business is - after all, they are avid consumers. This case helps them understand what they do know, and more importantly, what they do not know. The setting is 2009 and is not current, so students must consider whether retail from a process point of view has truly changed, or whether using technology-based interfaces in retail makes it seem to have changed. It also allows students to consider what advances in their retail experiences are the result of technology. This introductory case presents Uncle Joe's bicycle shop, Deals on Wheels. Mike and Mary have relocated to Raleigh, North Carolina, and are thinking of opening a bike shop there. On the way to their college reunion, they stop by Uncle Joe's house to visit and learn about his bicycle shop. Over dinner, the couple learns about how Uncle Joe acquired his business, the basic operations, what products were offered, and how customers' needs have changed over time. Some issues that Uncle Joe brings up in regard to expanding the business are possible advertising methods to produce additional sales, Internet-based parts sales that require more inventory on hand, and the need for more highly skilled workers. The story also mentions how Uncle Joe values human relations through his bike donations. The case may be used for class discussion of the following topics: Foundations of entrepreneurship; What is a business? Creating financial statements - transactions for one month are included as an exhibit to the case. Two follow-on cases offer more practice on these skills; Analyzing financial statements - three years of financials are included as an exhibit in the case. Students are asked to do a horizontal analysis and a vertical analysis of the data; Information systems in a business.
Authors :: William Nemitz, Dawna Travis Dewire, Richard Mandel, Ross Petty
Swot Analysis of "Deals on Wheels Inc." written by William Nemitz, Dawna Travis Dewire, Richard Mandel, Ross Petty includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Uncle Joe facing as an external strategic factors. Some of the topics covered in Deals on Wheels Inc. case study are - Strategic Management Strategies, Business processes, Entrepreneurship, Financial management, IT, Marketing and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Deals on Wheels Inc. casestudy better are - – digital marketing is dominated by two big players Facebook and Google, increasing transportation and logistics costs, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, technology disruption, geopolitical disruptions, challanges to central banks by blockchain based private currencies,
increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of Deals on Wheels Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Deals on Wheels Inc. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Uncle Joe, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Uncle Joe 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 Deals on Wheels Inc. can be done for the following purposes –
1. Strategic planning using facts provided in Deals on Wheels Inc. case study
2. Improving business portfolio management of Uncle Joe
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Uncle Joe
Strengths Deals on Wheels Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Uncle Joe in Deals on Wheels Inc. Harvard Business Review case study are -
Diverse revenue streams
– Uncle Joe is present in almost all the verticals within the industry. This has provided firm in Deals on Wheels Inc. 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.
Low bargaining power of suppliers
– Suppliers of Uncle Joe in the sector have low bargaining power. Deals on Wheels Inc. has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Uncle Joe to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Uncle Joe is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy in the Deals on Wheels Inc. 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.
Effective Research and Development (R&D)
– Uncle Joe 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 Deals on Wheels Inc. - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to lead change in Leadership & Managing People field
– Uncle Joe 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 Uncle Joe in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Uncle Joe 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 Deals on Wheels Inc. HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Uncle Joe 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 Uncle Joe is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Deals on Wheels Inc. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Leadership & Managing People industry
– Deals on Wheels Inc. firm has clearly differentiated products in the market place. This has enabled Uncle Joe to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Uncle Joe to invest into research and development (R&D) and innovation.
Successful track record of launching new products
– Uncle Joe has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Uncle Joe 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.
Superior customer experience
– The customer experience strategy of Uncle Joe in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
High switching costs
– The high switching costs that Uncle Joe 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.
Weaknesses Deals on Wheels Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Deals on Wheels Inc. are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Deals on Wheels Inc., is just above the industry average. Uncle Joe 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.
Low market penetration in new markets
– Outside its home market of Uncle Joe, firm in the HBR case study Deals on Wheels Inc. needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Deals on Wheels Inc. 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 Uncle Joe 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Uncle Joe 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.
Need for greater diversity
– Uncle Joe 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.
High bargaining power of channel partners
– Because of the regulatory requirements, William Nemitz, Dawna Travis Dewire, Richard Mandel, Ross Petty suggests that, Uncle Joe 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.
Slow decision making process
– As mentioned earlier in the report, Uncle Joe 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. Uncle Joe 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.
Increasing silos among functional specialists
– The organizational structure of Uncle Joe is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Uncle Joe needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Uncle Joe to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Deals on Wheels Inc. 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 Uncle Joe has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Deals on Wheels Inc., it seems that the employees of Uncle Joe 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.
Aligning sales with marketing
– It come across in the case study Deals on Wheels Inc. 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 Deals on Wheels Inc. can leverage the sales team experience to cultivate customer relationships as Uncle Joe is planning to shift buying processes online.
Opportunities Deals on Wheels Inc. | 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 Deals on Wheels Inc. are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Uncle Joe 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.
Learning at scale
– Online learning technologies has now opened space for Uncle Joe 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Uncle Joe can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Uncle Joe can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Uncle Joe 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. Uncle Joe 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.
Manufacturing automation
– Uncle Joe can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Uncle Joe can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Uncle Joe 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 Leadership & Managing People segment.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Uncle Joe in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Uncle Joe 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, Deals on Wheels Inc., to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Creating value in data economy
– The success of analytics program of Uncle Joe has opened avenues for new revenue streams for the organization in the industry. This can help Uncle Joe to build a more holistic ecosystem as suggested in the Deals on Wheels Inc. case study. Uncle Joe can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Uncle Joe can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Deals on Wheels Inc. 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Uncle Joe is facing challenges because of the dominance of functional experts in the organization. Deals on Wheels Inc. 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.
Threats Deals on Wheels Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Deals on Wheels Inc. 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 Uncle Joe 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.
Technology acceleration in Forth Industrial Revolution
– Uncle Joe has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Uncle Joe needs to keep up with the evolution of technology in the Leadership & Managing People 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.
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, Uncle Joe 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 Deals on Wheels Inc. .
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. Uncle Joe 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Uncle Joe in the Leadership & Managing People industry. The Leadership & Managing People 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Deals on Wheels Inc., Uncle Joe may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
High dependence on third party suppliers
– Uncle Joe 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.
Consumer confidence and its impact on Uncle Joe 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.
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. Uncle Joe needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
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 Uncle Joe.
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 Uncle Joe in the Leadership & Managing People sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Deals on Wheels Inc. 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 Deals on Wheels Inc. 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 Deals on Wheels Inc. 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 Deals on Wheels Inc. 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 Deals on Wheels Inc. 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 Uncle Joe needs to make to build a sustainable competitive advantage.