Case Study Description of DVMS Power Electronics Private Limited: Capacity Analysis
In 2016, the deputy general manager of operations at DVMS Power Electronics Private Limited (DVMS) in Gujarat, India, was faced with a problem at the company's transformer plant. In recent years, amidst growing demand, the company had experienced low manufacturing capacity and was often unable to fill customer orders. Various stakeholders expressed their concerns about failing service levels. The deputy general manager was considering additional capacity as an option, but simply adding such capacity might negatively affect DVMS' cost structure. He needed to consider the various short- and long-term options that would best benefit the company. He assigned the company's summer intern the task of collecting the required data regarding the manufacturing of transformers at DVMS: the specified number of machines and workers, the processing time, and the monthly demand data for transformers. He needed to prepare a report that identified weak areas and suggested possible ways to expand capacity. Kedar P. Joshi, Vasanth Kamath VP, and Mohnish Gulve are affiliated with T.A. Pai Management Institute.
Swot Analysis of "DVMS Power Electronics Private Limited: Capacity Analysis" written by Kedar Joshi, Vasanth Kamath VP, Mohnish Gulve includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Dvms Capacity facing as an external strategic factors. Some of the topics covered in DVMS Power Electronics Private Limited: Capacity Analysis case study are - Strategic Management Strategies, Economy, Manufacturing and Technology & Operations.
Some of the macro environment factors that can be used to understand the DVMS Power Electronics Private Limited: Capacity Analysis casestudy better are - – wage bills are increasing, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization,
digital marketing is dominated by two big players Facebook and Google, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of DVMS Power Electronics Private Limited: Capacity Analysis
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in DVMS Power Electronics Private Limited: Capacity Analysis case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Dvms Capacity, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Dvms Capacity 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 DVMS Power Electronics Private Limited: Capacity Analysis can be done for the following purposes –
1. Strategic planning using facts provided in DVMS Power Electronics Private Limited: Capacity Analysis case study
2. Improving business portfolio management of Dvms Capacity
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Dvms Capacity
Strengths DVMS Power Electronics Private Limited: Capacity Analysis | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Dvms Capacity in DVMS Power Electronics Private Limited: Capacity Analysis Harvard Business Review case study are -
Strong track record of project management
– Dvms Capacity is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Dvms Capacity 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.
Successful track record of launching new products
– Dvms Capacity has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Dvms Capacity 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.
Low bargaining power of suppliers
– Suppliers of Dvms Capacity in the sector have low bargaining power. DVMS Power Electronics Private Limited: Capacity Analysis has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Dvms Capacity to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Dvms Capacity has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Dvms Capacity to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Dvms Capacity 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 DVMS Power Electronics Private Limited: Capacity Analysis - 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 recruit top talent
– Dvms Capacity is one of the leading recruiters in the industry. Managers in the DVMS Power Electronics Private Limited: Capacity Analysis are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Dvms Capacity 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 Kedar Joshi, Vasanth Kamath VP, Mohnish Gulve 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
– Dvms Capacity has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in DVMS Power Electronics Private Limited: Capacity Analysis 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.
Learning organization
- Dvms Capacity 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 Dvms Capacity is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in DVMS Power Electronics Private Limited: Capacity Analysis Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Dvms Capacity digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Dvms Capacity 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.
High switching costs
– The high switching costs that Dvms Capacity 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 DVMS Power Electronics Private Limited: Capacity Analysis | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of DVMS Power Electronics Private Limited: Capacity Analysis are -
Slow decision making process
– As mentioned earlier in the report, Dvms Capacity 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. Dvms Capacity 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 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 Dvms Capacity supply chain. Even after few cautionary changes mentioned in the HBR case study - DVMS Power Electronics Private Limited: Capacity Analysis, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Dvms Capacity vulnerable to further global disruptions in South East Asia.
High bargaining power of channel partners
– Because of the regulatory requirements, Kedar Joshi, Vasanth Kamath VP, Mohnish Gulve suggests that, Dvms Capacity 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.
No frontier risks strategy
– After analyzing the HBR case study DVMS Power Electronics Private Limited: Capacity Analysis, it seems that company is thinking about the frontier risks that can impact Technology & Operations 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the DVMS Power Electronics Private Limited: Capacity Analysis 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 Dvms Capacity has relatively successful track record of launching new products.
Need for greater diversity
– Dvms Capacity 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study DVMS Power Electronics Private Limited: Capacity Analysis, in the dynamic environment Dvms Capacity has struggled to respond to the nimble upstart competition. Dvms Capacity has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Dvms Capacity 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 to strategic competitive environment developments
– As DVMS Power Electronics Private Limited: Capacity Analysis HBR case study mentions - Dvms Capacity 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Dvms Capacity is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study DVMS Power Electronics Private Limited: Capacity Analysis 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 operating costs
– Compare to the competitors, firm in the HBR case study DVMS Power Electronics Private Limited: Capacity Analysis 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 Dvms Capacity 's lucrative customers.
Opportunities DVMS Power Electronics Private Limited: Capacity Analysis | 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 DVMS Power Electronics Private Limited: Capacity Analysis are -
Creating value in data economy
– The success of analytics program of Dvms Capacity has opened avenues for new revenue streams for the organization in the industry. This can help Dvms Capacity to build a more holistic ecosystem as suggested in the DVMS Power Electronics Private Limited: Capacity Analysis case study. Dvms Capacity can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Dvms Capacity 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 DVMS Power Electronics Private Limited: Capacity Analysis - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Dvms Capacity to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Dvms Capacity to increase its market reach. Dvms Capacity 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.
Learning at scale
– Online learning technologies has now opened space for Dvms Capacity 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Dvms Capacity can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Dvms Capacity 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Dvms Capacity can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Dvms Capacity in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Dvms Capacity 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 Dvms Capacity to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Dvms Capacity 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.
Building a culture of innovation
– managers at Dvms Capacity 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 Technology & Operations segment.
Manufacturing automation
– Dvms Capacity can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Dvms Capacity 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, DVMS Power Electronics Private Limited: Capacity Analysis, 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 DVMS Power Electronics Private Limited: Capacity Analysis External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study DVMS Power Electronics Private Limited: Capacity Analysis are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Dvms Capacity 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 DVMS Power Electronics Private Limited: Capacity Analysis .
Stagnating economy with rate increase
– Dvms Capacity 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.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Dvms Capacity can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Dvms Capacity.
Shortening product life cycle
– it is one of the major threat that Dvms Capacity is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Dvms Capacity 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 Technology & Operations industry regulations.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Dvms Capacity with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Dvms Capacity in the Technology & Operations industry. The Technology & Operations 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.
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. Dvms Capacity 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.
High dependence on third party suppliers
– Dvms Capacity 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.
Environmental challenges
– Dvms Capacity 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. Dvms Capacity can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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 Dvms Capacity business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of DVMS Power Electronics Private Limited: Capacity Analysis 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 DVMS Power Electronics Private Limited: Capacity Analysis 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 DVMS Power Electronics Private Limited: Capacity Analysis 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 DVMS Power Electronics Private Limited: Capacity Analysis 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 DVMS Power Electronics Private Limited: Capacity Analysis 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 Dvms Capacity needs to make to build a sustainable competitive advantage.
