The Truth About Hierarchy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Communication
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Truth About Hierarchy
This is an MIT Sloan Management Review article. Research on social species shows that hierarchies are important for group functioning. Human beings also have a tendency to think and act hierarchically. In fact, hierarchies -distinct differences in group members' power and status -can be found in virtually every human group, from children on the playground to executives in the boardroom. Although many people have argued that flat organizations promote innovative thinking, the authors maintain that a properly deployed hierarchy can help teams engage in and get the most out of their efforts to learn and innovate. Specifically, the authors observe that hierarchies help teams generate, identify, and select new ideas by performing three critical functions: bounding solutions, converging ideas, and structuring processes. "A paradox of creativity, "the authors write, "is that people are more innovative when they have clear constraints (such as time, budget, customer requirements, etc.) within which their solutions must fit." Early on, teams tend to come up with an array of ideas and possibilities. Hierarchies, the authors explain, can help sort through which ideas should be pursued and which ones are less promising. The authors provide three recommendations for leaders seeking to leverage the power of hierarchy on teams and avoid its pitfalls. First, organizations should have a clear chain of command. In one study, teams with a clear chain of command were less likely to get bogged down in conflicts and stalemates than other teams. Second, organizations need to create performance-based cultures in which performance gets measured, publicized, and celebrated. Hierarchies in performance-based cultures are more likely to be based on expertise, and that can counteract unconscious biases against women and minorities. Third, people at the top of the organization should act in ways that support group goals as opposed to promoting their own interests. Citing a study one of the authors participated in, they write: "Hierarchies promoted learning and performance when goals and feedback were group-oriented, but they stifled learning and performance when goals and feedback were individually oriented."
Swot Analysis of "The Truth About Hierarchy" written by Bret Sanner, J. Stuart Bunderson includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hierarchies Teams facing as an external strategic factors. Some of the topics covered in The Truth About Hierarchy case study are - Strategic Management Strategies, and Communication.
Some of the macro environment factors that can be used to understand the The Truth About Hierarchy casestudy better are - – wage bills are increasing, geopolitical disruptions, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, increasing household debt because of falling income levels, increasing energy prices,
digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of The Truth About Hierarchy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Truth About Hierarchy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hierarchies Teams, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hierarchies Teams 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 The Truth About Hierarchy can be done for the following purposes –
1. Strategic planning using facts provided in The Truth About Hierarchy case study
2. Improving business portfolio management of Hierarchies Teams
3. Assessing feasibility of the new initiative in Communication field.
4. Making a Communication topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hierarchies Teams
Strengths The Truth About Hierarchy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hierarchies Teams in The Truth About Hierarchy Harvard Business Review case study are -
High brand equity
– Hierarchies Teams has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Hierarchies Teams to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Successful track record of launching new products
– Hierarchies Teams has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Hierarchies Teams 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.
Ability to lead change in Communication field
– Hierarchies Teams 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 Hierarchies Teams in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Analytics focus
– Hierarchies Teams 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 Bret Sanner, J. Stuart Bunderson 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 Hierarchies Teams 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.
Learning organization
- Hierarchies Teams 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 Hierarchies Teams is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in The Truth About Hierarchy Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Organizational Resilience of Hierarchies Teams
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Hierarchies Teams does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Hierarchies Teams in the sector have low bargaining power. The Truth About Hierarchy has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Hierarchies Teams to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Hierarchies Teams is present in almost all the verticals within the industry. This has provided firm in The Truth About Hierarchy 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.
Ability to recruit top talent
– Hierarchies Teams is one of the leading recruiters in the industry. Managers in the The Truth About Hierarchy are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Communication industry
– The Truth About Hierarchy firm has clearly differentiated products in the market place. This has enabled Hierarchies Teams to fetch slight price premium compare to the competitors in the Communication industry. The sustainable margins have also helped Hierarchies Teams to invest into research and development (R&D) and innovation.
Strong track record of project management
– Hierarchies Teams is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses The Truth About Hierarchy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Truth About Hierarchy are -
Skills based hiring
– The stress on hiring functional specialists at Hierarchies Teams 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Hierarchies Teams 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.
Low market penetration in new markets
– Outside its home market of Hierarchies Teams, firm in the HBR case study The Truth About Hierarchy needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Hierarchies Teams is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The Truth About Hierarchy 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 bargaining power of channel partners
– Because of the regulatory requirements, Bret Sanner, J. Stuart Bunderson suggests that, Hierarchies Teams 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.
Capital Spending Reduction
– Even during the low interest decade, Hierarchies Teams 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.
Interest costs
– Compare to the competition, Hierarchies Teams 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The Truth About Hierarchy, it seems that the employees of Hierarchies Teams 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.
Aligning sales with marketing
– It come across in the case study The Truth About Hierarchy 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 The Truth About Hierarchy can leverage the sales team experience to cultivate customer relationships as Hierarchies Teams is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The Truth About Hierarchy, is just above the industry average. Hierarchies Teams 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Truth About Hierarchy, in the dynamic environment Hierarchies Teams has struggled to respond to the nimble upstart competition. Hierarchies Teams has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities The Truth About Hierarchy | 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 The Truth About Hierarchy are -
Developing new processes and practices
– Hierarchies Teams can develop new processes and procedures in Communication 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Hierarchies Teams in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Communication segment, and it will provide faster access to the consumers.
Using analytics as competitive advantage
– Hierarchies Teams 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 The Truth About Hierarchy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hierarchies Teams to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hierarchies Teams can use these opportunities to build new business models that can help the communities that Hierarchies Teams operates in. Secondly it can use opportunities from government spending in Communication sector.
Buying journey improvements
– Hierarchies Teams can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Truth About Hierarchy 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.
Learning at scale
– Online learning technologies has now opened space for Hierarchies Teams 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.
Better consumer reach
– The expansion of the 5G network will help Hierarchies Teams to increase its market reach. Hierarchies Teams 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.
Loyalty marketing
– Hierarchies Teams 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.
Creating value in data economy
– The success of analytics program of Hierarchies Teams has opened avenues for new revenue streams for the organization in the industry. This can help Hierarchies Teams to build a more holistic ecosystem as suggested in the The Truth About Hierarchy case study. Hierarchies Teams can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Hierarchies Teams can use the latest technology developments to improve its manufacturing and designing process in Communication 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.
Building a culture of innovation
– managers at Hierarchies Teams 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 Communication segment.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hierarchies Teams 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 Hierarchies Teams to hire the very best people irrespective of their geographical location.
Leveraging digital technologies
– Hierarchies Teams 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.
Threats The Truth About Hierarchy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Truth About Hierarchy are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Hierarchies Teams 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 The Truth About Hierarchy .
Consumer confidence and its impact on Hierarchies Teams 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.
Stagnating economy with rate increase
– Hierarchies Teams 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 Hierarchies Teams in the Communication industry. The Communication 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.
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. Hierarchies Teams needs to understand the core reasons impacting the Communication industry. This will help it in building a better workplace.
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 Hierarchies Teams 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 Communication field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hierarchies Teams can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The Truth About Hierarchy, Hierarchies Teams may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Communication .
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 Hierarchies Teams.
Increasing wage structure of Hierarchies Teams
– 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 Hierarchies Teams.
Technology acceleration in Forth Industrial Revolution
– Hierarchies Teams has witnessed rapid integration of technology during Covid-19 in the Communication industry. As one of the leading players in the industry, Hierarchies Teams needs to keep up with the evolution of technology in the Communication 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.
High dependence on third party suppliers
– Hierarchies Teams 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.
Weighted SWOT Analysis of The Truth About Hierarchy 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 The Truth About Hierarchy 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 The Truth About Hierarchy 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 The Truth About Hierarchy 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 The Truth About Hierarchy 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 Hierarchies Teams needs to make to build a sustainable competitive advantage.