John Deere Reman: Creating Value Through Reverse Logistics SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of John Deere Reman: Creating Value Through Reverse Logistics
The factory manager of John Deere Reman, located in Edmonton, Canada, was preparing for a meeting in September 2017, with the general manager of Global Reman Operations and Marketing at the company's head office in Springfield, Missouri. John Deere's remanufacturing operations had been steadily improving over the last decade. The purpose of the meeting was to discuss opportunities for changes to John Deere's remanufacturing operation that would provide value to the company, improve customer service, and support the company's commitment to environmental sustainability.
Swot Analysis of "John Deere Reman: Creating Value Through Reverse Logistics" written by P. Fraser Johnson, R. Chandrasekhar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Reman Deere's facing as an external strategic factors. Some of the topics covered in John Deere Reman: Creating Value Through Reverse Logistics case study are - Strategic Management Strategies, Supply chain, Sustainability and Technology & Operations.
Some of the macro environment factors that can be used to understand the John Deere Reman: Creating Value Through Reverse Logistics casestudy better are - – challanges to central banks by blockchain based private currencies, digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, increasing transportation and logistics costs, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, supply chains are disrupted by pandemic ,
increasing energy prices, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of John Deere Reman: Creating Value Through Reverse Logistics
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in John Deere Reman: Creating Value Through Reverse Logistics case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Reman Deere's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Reman Deere'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 John Deere Reman: Creating Value Through Reverse Logistics can be done for the following purposes –
1. Strategic planning using facts provided in John Deere Reman: Creating Value Through Reverse Logistics case study
2. Improving business portfolio management of Reman Deere's
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 Reman Deere's
Strengths John Deere Reman: Creating Value Through Reverse Logistics | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Reman Deere's in John Deere Reman: Creating Value Through Reverse Logistics Harvard Business Review case study are -
Strong track record of project management
– Reman Deere's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Low bargaining power of suppliers
– Suppliers of Reman Deere's in the sector have low bargaining power. John Deere Reman: Creating Value Through Reverse Logistics has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Reman Deere's to manage not only supply disruptions but also source products at highly competitive prices.
High brand equity
– Reman Deere's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Reman Deere's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Reman Deere'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.
Training and development
– Reman Deere's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in John Deere Reman: Creating Value Through Reverse Logistics 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.
Superior customer experience
– The customer experience strategy of Reman Deere's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Reman Deere'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 John Deere Reman: Creating Value Through Reverse Logistics HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Reman Deere'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 Reman Deere's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in John Deere Reman: Creating Value Through Reverse Logistics Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Reman Deere's is one of the most innovative firm in sector. Manager in John Deere Reman: Creating Value Through Reverse Logistics Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Reman Deere'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 P. Fraser Johnson, R. Chandrasekhar 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.
Cross disciplinary teams
– Horizontal connected teams at the Reman Deere'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.
Operational resilience
– The operational resilience strategy in the John Deere Reman: Creating Value Through Reverse Logistics 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.
Weaknesses John Deere Reman: Creating Value Through Reverse Logistics | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of John Deere Reman: Creating Value Through Reverse Logistics are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study John Deere Reman: Creating Value Through Reverse Logistics, in the dynamic environment Reman Deere's has struggled to respond to the nimble upstart competition. Reman Deere's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Reman Deere's supply chain. Even after few cautionary changes mentioned in the HBR case study - John Deere Reman: Creating Value Through Reverse Logistics, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Reman Deere's vulnerable to further global disruptions in South East Asia.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Reman Deere's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study John Deere Reman: Creating Value Through Reverse Logistics can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Reman Deere'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. Reman Deere'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.
Need for greater diversity
– Reman Deere'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.
Workers concerns about automation
– As automation is fast increasing in the segment, Reman Deere's 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.
No frontier risks strategy
– After analyzing the HBR case study John Deere Reman: Creating Value Through Reverse Logistics, 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.
Low market penetration in new markets
– Outside its home market of Reman Deere's, firm in the HBR case study John Deere Reman: Creating Value Through Reverse Logistics 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 John Deere Reman: Creating Value Through Reverse Logistics, is just above the industry average. Reman Deere'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.
Lack of clear differentiation of Reman Deere's products
– To increase the profitability and margins on the products, Reman Deere's needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study John Deere Reman: Creating Value Through Reverse Logistics 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 John Deere Reman: Creating Value Through Reverse Logistics can leverage the sales team experience to cultivate customer relationships as Reman Deere's is planning to shift buying processes online.
Opportunities John Deere Reman: Creating Value Through Reverse Logistics | 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 John Deere Reman: Creating Value Through Reverse Logistics are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Reman Deere'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 Technology & Operations segment, and it will provide faster access to the consumers.
Leveraging digital technologies
– Reman Deere's 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.
Building a culture of innovation
– managers at Reman Deere'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 Technology & Operations segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Reman Deere's can use these opportunities to build new business models that can help the communities that Reman Deere's operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Manufacturing automation
– Reman Deere's 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Reman Deere'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 Reman Deere's to hire the very best people irrespective of their geographical location.
Loyalty marketing
– Reman Deere's 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.
Better consumer reach
– The expansion of the 5G network will help Reman Deere's to increase its market reach. Reman Deere's 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.
Buying journey improvements
– Reman Deere's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. John Deere Reman: Creating Value Through Reverse Logistics 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Reman Deere'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. Reman Deere'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.
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 Reman Deere'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.
Learning at scale
– Online learning technologies has now opened space for Reman Deere'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.
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 Reman Deere's in the consumer business. Now Reman Deere's can target international markets with far fewer capital restrictions requirements than the existing system.
Threats John Deere Reman: Creating Value Through Reverse Logistics External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study John Deere Reman: Creating Value Through Reverse Logistics 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. Reman Deere's needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study John Deere Reman: Creating Value Through Reverse Logistics, Reman Deere'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 Technology & Operations .
Increasing wage structure of Reman Deere's
– 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 Reman Deere's.
Stagnating economy with rate increase
– Reman Deere'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 Reman Deere's 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Reman Deere'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 Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Reman Deere's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Reman Deere's 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.
Regulatory challenges
– Reman Deere'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 Technology & Operations 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 Reman Deere's.
Consumer confidence and its impact on Reman Deere'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
– Reman Deere'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.
Technology acceleration in Forth Industrial Revolution
– Reman Deere's has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Reman Deere's needs to keep up with the evolution of technology in the Technology & Operations 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.
Weighted SWOT Analysis of John Deere Reman: Creating Value Through Reverse Logistics 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 John Deere Reman: Creating Value Through Reverse Logistics 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 John Deere Reman: Creating Value Through Reverse Logistics 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 John Deere Reman: Creating Value Through Reverse Logistics 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 John Deere Reman: Creating Value Through Reverse Logistics 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 Reman Deere's needs to make to build a sustainable competitive advantage.
