New Flyer Industries: Innovation in Transit SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
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Case Study SWOT Analysis Solution
Case Study Description of New Flyer Industries: Innovation in Transit
In late 2017, senior management staff at New Flyer Industries Inc. (NFI) were reflecting on the recent growth of their company. NFI was an automotive company that specialized in heavy-duty transit buses and motor coaches. It had been over a year since it had acquired Motor Coach Industries International Inc., and the leadership team was pleased with NFI's performance; however, they wondered why the company's stock price had become stagnant in recent months. NFI had a long history of operational excellence and innovation and had exhibited growth through acquisitions. Had NFI reached the limits of its current strategy? What opportunities and threats existed in the industry? Which resources had enabled the firm to achieve market success? The management team needed to analyze the business and its environment to identify a way forward. Tyler Case and Brooke Dobni are affiliated with University of Saskatchewan.
Swot Analysis of "New Flyer Industries: Innovation in Transit" written by Tyler Case, Brooke Dobni includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Nfi Flyer facing as an external strategic factors. Some of the topics covered in New Flyer Industries: Innovation in Transit case study are - Strategic Management Strategies, Manufacturing and Strategy & Execution.
Some of the macro environment factors that can be used to understand the New Flyer Industries: Innovation in Transit casestudy better are - – central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , increasing energy prices, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%,
customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of New Flyer Industries: Innovation in Transit
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in New Flyer Industries: Innovation in Transit case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Nfi Flyer, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Nfi Flyer 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 New Flyer Industries: Innovation in Transit can be done for the following purposes –
1. Strategic planning using facts provided in New Flyer Industries: Innovation in Transit case study
2. Improving business portfolio management of Nfi Flyer
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Nfi Flyer
Strengths New Flyer Industries: Innovation in Transit | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Nfi Flyer in New Flyer Industries: Innovation in Transit Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the New Flyer Industries: Innovation in Transit 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.
Ability to recruit top talent
– Nfi Flyer is one of the leading recruiters in the industry. Managers in the New Flyer Industries: Innovation in Transit are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Nfi Flyer 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.
Effective Research and Development (R&D)
– Nfi Flyer 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 New Flyer Industries: Innovation in Transit - 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
– Nfi Flyer has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in New Flyer Industries: Innovation in Transit 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.
Strong track record of project management
– Nfi Flyer is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Nfi Flyer is one of the most innovative firm in sector. Manager in New Flyer Industries: Innovation in Transit Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Strategy & Execution field
– Nfi Flyer 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 Nfi Flyer in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Nfi Flyer
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Nfi Flyer does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Nfi Flyer has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Nfi Flyer 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.
Sustainable margins compare to other players in Strategy & Execution industry
– New Flyer Industries: Innovation in Transit firm has clearly differentiated products in the market place. This has enabled Nfi Flyer to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Nfi Flyer to invest into research and development (R&D) and innovation.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Nfi Flyer digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Nfi Flyer 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.
Weaknesses New Flyer Industries: Innovation in Transit | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of New Flyer Industries: Innovation in Transit are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study New Flyer Industries: Innovation in Transit, in the dynamic environment Nfi Flyer has struggled to respond to the nimble upstart competition. Nfi Flyer has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High operating costs
– Compare to the competitors, firm in the HBR case study New Flyer Industries: Innovation in Transit 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 Nfi Flyer 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Nfi Flyer, firm in the HBR case study New Flyer Industries: Innovation in Transit needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study New Flyer Industries: Innovation in Transit, is just above the industry average. Nfi Flyer 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Nfi Flyer 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 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 Nfi Flyer supply chain. Even after few cautionary changes mentioned in the HBR case study - New Flyer Industries: Innovation in Transit, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Nfi Flyer vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study New Flyer Industries: Innovation in Transit, it seems that the employees of Nfi Flyer 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 star products
– The top 2 products and services of the firm as mentioned in the New Flyer Industries: Innovation in Transit 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 Nfi Flyer has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Nfi Flyer 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.
Slow decision making process
– As mentioned earlier in the report, Nfi Flyer 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. Nfi Flyer 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.
Need for greater diversity
– Nfi Flyer 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 New Flyer Industries: Innovation in Transit | 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 New Flyer Industries: Innovation in Transit are -
Loyalty marketing
– Nfi Flyer 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.
Developing new processes and practices
– Nfi Flyer can develop new processes and procedures in Strategy & Execution 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.
Better consumer reach
– The expansion of the 5G network will help Nfi Flyer to increase its market reach. Nfi Flyer 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.
Using analytics as competitive advantage
– Nfi Flyer 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 New Flyer Industries: Innovation in Transit - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Nfi Flyer to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Nfi Flyer can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Nfi Flyer 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 Nfi Flyer to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Nfi Flyer 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. Nfi Flyer 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Nfi Flyer is facing challenges because of the dominance of functional experts in the organization. New Flyer Industries: Innovation in Transit 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.
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 Nfi Flyer 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.
Manufacturing automation
– Nfi Flyer can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
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 Nfi Flyer in the consumer business. Now Nfi Flyer can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Nfi Flyer 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 Strategy & Execution segment.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Nfi Flyer 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, New Flyer Industries: Innovation in Transit, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats New Flyer Industries: Innovation in Transit External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study New Flyer Industries: Innovation in Transit are -
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. Nfi Flyer needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing wage structure of Nfi Flyer
– 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 Nfi Flyer.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study New Flyer Industries: Innovation in Transit, Nfi Flyer may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
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 Nfi Flyer business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Nfi Flyer 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. Nfi Flyer can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Consumer confidence and its impact on Nfi Flyer 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.
Stagnating economy with rate increase
– Nfi Flyer 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Nfi Flyer with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Nfi Flyer is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Nfi Flyer.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Nfi Flyer can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Nfi Flyer in the Strategy & Execution industry. The Strategy & Execution 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.
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.
Weighted SWOT Analysis of New Flyer Industries: Innovation in Transit 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 New Flyer Industries: Innovation in Transit 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 New Flyer Industries: Innovation in Transit 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 New Flyer Industries: Innovation in Transit 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 New Flyer Industries: Innovation in Transit 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 Nfi Flyer needs to make to build a sustainable competitive advantage.