Case Study Description of Allied Founders: Surviving Internationally
On June 25, 2014, the director of marketing and development at Allied Founders Pvt. Ltd., a company that operated out of Belgaum in India, was analyzing various problems associated with his company's management approach. The director was considering a change from the company's system of breakdown maintenance to a new information system of preventive maintenance. While executing its first international export order, the company faced several challenges related to production delays, mainly due to poor equipment maintenance. To plan for his company's future in the international market, the director proposed adopting preventive maintenance as a solution, but he was unsure whether to use traditional means (i.e., manual record keeping) or implement a new information system. He was concerned about the issues that could arise from the change, including resistance from employees worried about job loss, providing the necessary training, and exposing the company to other risks. Gurudutt Nayak, Amol Dhaigude, and Debmallya Chatterjee are affiliated with T.A. Pai Management Institute.
Swot Analysis of "Allied Founders: Surviving Internationally" written by Gurudutt Nayak, Amol Dhaigude, Debmallya Chatterjee includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Maintenance Preventive facing as an external strategic factors. Some of the topics covered in Allied Founders: Surviving Internationally case study are - Strategic Management Strategies, IT, Manufacturing and Technology & Operations.
Some of the macro environment factors that can be used to understand the Allied Founders: Surviving Internationally casestudy better are - – supply chains are disrupted by pandemic , geopolitical disruptions, there is backlash against globalization, increasing transportation and logistics costs, increasing energy prices, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation,
cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Allied Founders: Surviving Internationally
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Allied Founders: Surviving Internationally case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Maintenance Preventive, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Maintenance Preventive 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 Allied Founders: Surviving Internationally can be done for the following purposes –
1. Strategic planning using facts provided in Allied Founders: Surviving Internationally case study
2. Improving business portfolio management of Maintenance Preventive
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 Maintenance Preventive
Strengths Allied Founders: Surviving Internationally | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Maintenance Preventive in Allied Founders: Surviving Internationally Harvard Business Review case study are -
Effective Research and Development (R&D)
– Maintenance Preventive 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 Allied Founders: Surviving Internationally - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Maintenance Preventive digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Maintenance Preventive 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.
Ability to lead change in Technology & Operations field
– Maintenance Preventive 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 Maintenance Preventive in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Learning organization
- Maintenance Preventive 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 Maintenance Preventive is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Allied Founders: Surviving Internationally Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Maintenance Preventive is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Maintenance Preventive is one of the most innovative firm in sector. Manager in Allied Founders: Surviving Internationally Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Maintenance Preventive has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Maintenance Preventive 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.
High switching costs
– The high switching costs that Maintenance Preventive 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.
High brand equity
– Maintenance Preventive has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Maintenance Preventive to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Maintenance Preventive is present in almost all the verticals within the industry. This has provided firm in Allied Founders: Surviving Internationally 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.
Organizational Resilience of Maintenance Preventive
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Maintenance Preventive does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Maintenance Preventive is one of the leading recruiters in the industry. Managers in the Allied Founders: Surviving Internationally are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Allied Founders: Surviving Internationally | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Allied Founders: Surviving Internationally are -
Slow to strategic competitive environment developments
– As Allied Founders: Surviving Internationally HBR case study mentions - Maintenance Preventive 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Allied Founders: Surviving Internationally, in the dynamic environment Maintenance Preventive has struggled to respond to the nimble upstart competition. Maintenance Preventive has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Capital Spending Reduction
– Even during the low interest decade, Maintenance Preventive 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.
Increasing silos among functional specialists
– The organizational structure of Maintenance Preventive is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Maintenance Preventive needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Maintenance Preventive 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 Allied Founders: Surviving Internationally 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 Maintenance Preventive 's lucrative customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Maintenance Preventive needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Maintenance Preventive supply chain. Even after few cautionary changes mentioned in the HBR case study - Allied Founders: Surviving Internationally, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Maintenance Preventive vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Maintenance Preventive 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.
Slow decision making process
– As mentioned earlier in the report, Maintenance Preventive 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. Maintenance Preventive 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.
Lack of clear differentiation of Maintenance Preventive products
– To increase the profitability and margins on the products, Maintenance Preventive needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Maintenance Preventive 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.
Opportunities Allied Founders: Surviving Internationally | 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 Allied Founders: Surviving Internationally are -
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 Maintenance Preventive 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.
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 Maintenance Preventive in the consumer business. Now Maintenance Preventive can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Maintenance Preventive 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.
Learning at scale
– Online learning technologies has now opened space for Maintenance Preventive 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.
Loyalty marketing
– Maintenance Preventive 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 Maintenance Preventive 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Maintenance Preventive can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Maintenance Preventive can use these opportunities to build new business models that can help the communities that Maintenance Preventive operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
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. Maintenance Preventive can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Buying journey improvements
– Maintenance Preventive can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Allied Founders: Surviving Internationally 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Maintenance Preventive 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.
Better consumer reach
– The expansion of the 5G network will help Maintenance Preventive to increase its market reach. Maintenance Preventive will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Using analytics as competitive advantage
– Maintenance Preventive 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 Allied Founders: Surviving Internationally - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Maintenance Preventive to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Allied Founders: Surviving Internationally External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Allied Founders: Surviving Internationally are -
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 Maintenance Preventive business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Maintenance Preventive 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
– Maintenance Preventive 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.
Increasing wage structure of Maintenance Preventive
– 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 Maintenance Preventive.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Allied Founders: Surviving Internationally, Maintenance Preventive 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 .
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. Maintenance Preventive can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Maintenance Preventive has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Maintenance Preventive 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.
Regulatory challenges
– Maintenance Preventive 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 Maintenance Preventive with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Maintenance Preventive 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 Allied Founders: Surviving Internationally .
Shortening product life cycle
– it is one of the major threat that Maintenance Preventive is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Environmental challenges
– Maintenance Preventive 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. Maintenance Preventive can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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. Maintenance Preventive 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.
Weighted SWOT Analysis of Allied Founders: Surviving Internationally 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 Allied Founders: Surviving Internationally 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 Allied Founders: Surviving Internationally 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 Allied Founders: Surviving Internationally 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 Allied Founders: Surviving Internationally 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 Maintenance Preventive needs to make to build a sustainable competitive advantage.