Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy
This case documents the history of Ashok Leyland (AL), the second largest commercial vehicle manufacturer in India, and captures its growth and journey up to 2007, when the company adopted its new vision of more than doubling in size in a fairly mature industry. The challenge that the case poses to students is to understand how the firm, widely regarded as a small player globally and as a regional one even within India, could fulfill this ambitious vision.
Swot Analysis of "Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy" written by Kannan Srikanth, Geetika Shah includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Leyland Ashok facing as an external strategic factors. Some of the topics covered in Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy case study are - Strategic Management Strategies, Strategy execution and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy casestudy better are - – increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, increasing energy prices, central banks are concerned over increasing inflation, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies,
cloud computing is disrupting traditional business models, technology disruption, etc
Introduction to SWOT Analysis of Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Leyland Ashok, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Leyland Ashok 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy can be done for the following purposes –
1. Strategic planning using facts provided in Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy case study
2. Improving business portfolio management of Leyland Ashok
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 Leyland Ashok
Strengths Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Leyland Ashok in Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy Harvard Business Review case study are -
Analytics focus
– Leyland Ashok 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 Kannan Srikanth, Geetika Shah 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.
High switching costs
– The high switching costs that Leyland Ashok 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.
Cross disciplinary teams
– Horizontal connected teams at the Leyland Ashok 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.
Operational resilience
– The operational resilience strategy in the Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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 lead change in Strategy & Execution field
– Leyland Ashok 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 Leyland Ashok in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Leyland Ashok in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Leyland Ashok is one of the most innovative firm in sector. Manager in Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Leyland Ashok digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Leyland Ashok 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.
Training and development
– Leyland Ashok has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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.
Highly skilled collaborators
– Leyland Ashok 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Leyland Ashok has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Leyland Ashok to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Strategy & Execution industry
– Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy firm has clearly differentiated products in the market place. This has enabled Leyland Ashok to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Leyland Ashok to invest into research and development (R&D) and innovation.
Weaknesses Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy are -
Capital Spending Reduction
– Even during the low interest decade, Leyland Ashok has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Skills based hiring
– The stress on hiring functional specialists at Leyland Ashok 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy, it seems that the employees of Leyland Ashok 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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 Leyland Ashok has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Leyland Ashok, firm in the HBR case study Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Leyland Ashok is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Leyland Ashok needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Leyland Ashok to focus more on services rather than just following the product oriented approach.
High operating costs
– Compare to the competitors, firm in the HBR case study Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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 Leyland Ashok 's lucrative customers.
Need for greater diversity
– Leyland Ashok 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.
No frontier risks strategy
– After analyzing the HBR case study Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy, it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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 harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Leyland Ashok is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
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 Leyland Ashok supply chain. Even after few cautionary changes mentioned in the HBR case study - Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Leyland Ashok vulnerable to further global disruptions in South East Asia.
Opportunities Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy | 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Leyland Ashok 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Leyland Ashok can use these opportunities to build new business models that can help the communities that Leyland Ashok operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Leyland Ashok 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 Leyland Ashok 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 Leyland Ashok to hire the very best people irrespective of their geographical location.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Leyland Ashok is facing challenges because of the dominance of functional experts in the organization. Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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.
Using analytics as competitive advantage
– Leyland Ashok 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Leyland Ashok to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Leyland Ashok 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, Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Leyland Ashok 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.
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. Leyland Ashok can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Leyland Ashok 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.
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 Leyland Ashok 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.
Leveraging digital technologies
– Leyland Ashok 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.
Creating value in data economy
– The success of analytics program of Leyland Ashok has opened avenues for new revenue streams for the organization in the industry. This can help Leyland Ashok to build a more holistic ecosystem as suggested in the Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy case study. Leyland Ashok can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy are -
Technology acceleration in Forth Industrial Revolution
– Leyland Ashok has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Leyland Ashok needs to keep up with the evolution of technology in the Strategy & Execution 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.
Environmental challenges
– Leyland Ashok 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. Leyland Ashok can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Leyland Ashok with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 wage structure of Leyland Ashok
– 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 Leyland Ashok.
High dependence on third party suppliers
– Leyland Ashok 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy, Leyland Ashok 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 .
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 Leyland Ashok in the Strategy & Execution sector and impact the bottomline of the organization.
Regulatory challenges
– Leyland Ashok 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 Strategy & Execution industry regulations.
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 Leyland Ashok.
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. Leyland Ashok needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Leyland Ashok 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy .
Weighted SWOT Analysis of Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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 Ashok Leyland (A): Reaching For the Stars - Embarking on a New Vision and Strategy 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 Leyland Ashok needs to make to build a sustainable competitive advantage.
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