Turmoil at CSX: Hunter Harrison's Medical Leave SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Turmoil at CSX: Hunter Harrison's Medical Leave
In December 2017, two news releases were issued by CSX Corporation (CSX) concerning its chief executive officer (CEO), who had been appointed nine months earlier based on his record of drastically cutting operating expenses. The first release indicated that the CEO had taken a medical leave of absence due to unexpected complications from a recent illness and that an acting CEO had been appointed. The next day, CSX shares dropped 7.6 per cent, erasing almost $4 billion in market value. The second release, two days later, indicated that the CEO had died. Subsequent news reports questioned the board's initial decision to hire him. The events raised issues related to unlocking shareholder value, the role of boards, and the impact of activist shareholders. Did the board do sufficient due diligence surrounding the CEO's health when he was initially hired? Was the CEO's vision and strategy more important than its implementation? Was the hiring of this CEO short-term thinking?
Swot Analysis of "Turmoil at CSX: Hunter Harrison's Medical Leave" written by Stephen R. Foerster includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Csx Ceo's facing as an external strategic factors. Some of the topics covered in Turmoil at CSX: Hunter Harrison's Medical Leave case study are - Strategic Management Strategies, Corporate communications, Mergers & acquisitions and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Turmoil at CSX: Hunter Harrison's Medical Leave casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing inequality as vast percentage of new income is going to the top 1%, geopolitical disruptions, increasing government debt because of Covid-19 spendings, increasing commodity prices, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies,
talent flight as more people leaving formal jobs, technology disruption, etc
Introduction to SWOT Analysis of Turmoil at CSX: Hunter Harrison's Medical Leave
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Turmoil at CSX: Hunter Harrison's Medical Leave case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Csx Ceo's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Csx Ceo'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 Turmoil at CSX: Hunter Harrison's Medical Leave can be done for the following purposes –
1. Strategic planning using facts provided in Turmoil at CSX: Hunter Harrison's Medical Leave case study
2. Improving business portfolio management of Csx Ceo's
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Csx Ceo's
Strengths Turmoil at CSX: Hunter Harrison's Medical Leave | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Csx Ceo's in Turmoil at CSX: Hunter Harrison's Medical Leave Harvard Business Review case study are -
Analytics focus
– Csx Ceo'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 Stephen R. Foerster 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.
Training and development
– Csx Ceo's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Turmoil at CSX: Hunter Harrison's Medical Leave 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.
Innovation driven organization
– Csx Ceo's is one of the most innovative firm in sector. Manager in Turmoil at CSX: Hunter Harrison's Medical Leave Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Csx Ceo's has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Diverse revenue streams
– Csx Ceo's is present in almost all the verticals within the industry. This has provided firm in Turmoil at CSX: Hunter Harrison's Medical Leave 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 Csx Ceo's in the sector have low bargaining power. Turmoil at CSX: Hunter Harrison's Medical Leave has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Csx Ceo's to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Csx Ceo's 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 Csx Ceo's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Turmoil at CSX: Hunter Harrison's Medical Leave Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Cross disciplinary teams
– Horizontal connected teams at the Csx Ceo's are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Ability to lead change in Finance & Accounting field
– Csx Ceo's 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 Csx Ceo's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Csx Ceo'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 Turmoil at CSX: Hunter Harrison's Medical Leave HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Csx Ceo'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 Turmoil at CSX: Hunter Harrison's Medical Leave - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Finance & Accounting industry
– Turmoil at CSX: Hunter Harrison's Medical Leave firm has clearly differentiated products in the market place. This has enabled Csx Ceo's to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Csx Ceo's to invest into research and development (R&D) and innovation.
Weaknesses Turmoil at CSX: Hunter Harrison's Medical Leave | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Turmoil at CSX: Hunter Harrison's Medical Leave are -
Need for greater diversity
– Csx Ceo'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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Turmoil at CSX: Hunter Harrison's Medical Leave, is just above the industry average. Csx Ceo's 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.
No frontier risks strategy
– After analyzing the HBR case study Turmoil at CSX: Hunter Harrison's Medical Leave, it seems that company is thinking about the frontier risks that can impact Finance & Accounting 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.
Slow to strategic competitive environment developments
– As Turmoil at CSX: Hunter Harrison's Medical Leave HBR case study mentions - Csx Ceo's takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Lack of clear differentiation of Csx Ceo's products
– To increase the profitability and margins on the products, Csx Ceo's needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Csx Ceo's 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.
Increasing silos among functional specialists
– The organizational structure of Csx Ceo's is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Csx Ceo's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Csx Ceo's to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Turmoil at CSX: Hunter Harrison's Medical Leave 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 Turmoil at CSX: Hunter Harrison's Medical Leave can leverage the sales team experience to cultivate customer relationships as Csx Ceo's is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Csx Ceo's has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Slow decision making process
– As mentioned earlier in the report, Csx Ceo's has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Csx Ceo's even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High operating costs
– Compare to the competitors, firm in the HBR case study Turmoil at CSX: Hunter Harrison's Medical Leave 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 Csx Ceo's 's lucrative customers.
Opportunities Turmoil at CSX: Hunter Harrison's Medical Leave | 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 Turmoil at CSX: Hunter Harrison's Medical Leave are -
Learning at scale
– Online learning technologies has now opened space for Csx Ceo's to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Building a culture of innovation
– managers at Csx Ceo's 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 Finance & Accounting segment.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Csx Ceo'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. Csx Ceo'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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Csx Ceo's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Csx Ceo's can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
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 Csx Ceo's to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Csx Ceo'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 Finance & Accounting segment, and it will provide faster access to the consumers.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Csx Ceo's 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 Csx Ceo'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 Csx Ceo's to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Csx Ceo's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Turmoil at CSX: Hunter Harrison's Medical Leave 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Csx Ceo's can use these opportunities to build new business models that can help the communities that Csx Ceo's operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Csx Ceo'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.
Using analytics as competitive advantage
– Csx Ceo's has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Turmoil at CSX: Hunter Harrison's Medical Leave - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Csx Ceo's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Turmoil at CSX: Hunter Harrison's Medical Leave External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Turmoil at CSX: Hunter Harrison's Medical Leave are -
Consumer confidence and its impact on Csx Ceo'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.
High dependence on third party suppliers
– Csx Ceo's high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
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.
Technology acceleration in Forth Industrial Revolution
– Csx Ceo's has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Csx Ceo's needs to keep up with the evolution of technology in the Finance & Accounting 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Csx Ceo's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Csx Ceo's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Turmoil at CSX: Hunter Harrison's Medical Leave, Csx Ceo's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
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 Csx Ceo's business can come under increasing regulations regarding data privacy, data security, 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 Csx Ceo's.
Stagnating economy with rate increase
– Csx Ceo'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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Csx Ceo's in the Finance & Accounting industry. The Finance & Accounting 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.
Regulatory challenges
– Csx Ceo'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 Finance & Accounting industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Csx Ceo'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 Turmoil at CSX: Hunter Harrison's Medical Leave .
Weighted SWOT Analysis of Turmoil at CSX: Hunter Harrison's Medical Leave 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 Turmoil at CSX: Hunter Harrison's Medical Leave 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 Turmoil at CSX: Hunter Harrison's Medical Leave 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 Turmoil at CSX: Hunter Harrison's Medical Leave 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 Turmoil at CSX: Hunter Harrison's Medical Leave 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 Csx Ceo's needs to make to build a sustainable competitive advantage.
