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 - – banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, technology disruption, increasing commodity prices, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy,
supply chains are disrupted by pandemic , increasing transportation and logistics costs, 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 -
Effective Research and Development (R&D)
– Hierarchies Teams 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 The Truth About Hierarchy - 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
– 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.
Superior customer experience
– The customer experience strategy of Hierarchies Teams in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Hierarchies Teams 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 The Truth About Hierarchy HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
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.
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.
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.
Operational resilience
– The operational resilience strategy in the The Truth About Hierarchy 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.
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.
Cross disciplinary teams
– Horizontal connected teams at the Hierarchies Teams 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.
Training and development
– Hierarchies Teams has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Truth About Hierarchy 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.
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.
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 -
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.
High cash cycle compare to competitors
Hierarchies Teams has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
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 Hierarchies Teams supply chain. Even after few cautionary changes mentioned in the HBR case study - The Truth About Hierarchy, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hierarchies Teams vulnerable to further global disruptions in South East Asia.
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.
Increasing silos among functional specialists
– The organizational structure of Hierarchies Teams is dominated by functional specialists. It is not different from other players in the Communication segment. Hierarchies Teams needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hierarchies Teams to focus more on services rather than just following the product oriented approach.
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.
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.
High operating costs
– Compare to the competitors, firm in the HBR case study The Truth About Hierarchy 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 Hierarchies Teams 's lucrative customers.
Slow to strategic competitive environment developments
– As The Truth About Hierarchy HBR case study mentions - Hierarchies Teams 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.
Products dominated business model
– Even though Hierarchies Teams has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - The Truth About Hierarchy should strive to include more intangible value offerings along with its core products and services.
No frontier risks strategy
– After analyzing the HBR case study The Truth About Hierarchy, it seems that company is thinking about the frontier risks that can impact Communication 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.
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 -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hierarchies Teams 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 Hierarchies Teams 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.
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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Communication industry, but it has also influenced the consumer preferences. Hierarchies Teams 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 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Hierarchies Teams can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Hierarchies Teams in the consumer business. Now Hierarchies Teams can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Hierarchies Teams can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hierarchies Teams 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, The Truth About Hierarchy, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
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.
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.
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 -
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.
Regulatory challenges
– Hierarchies Teams 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 Communication industry regulations.
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.
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. Hierarchies Teams 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.
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.
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 .
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.
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 .
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
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.
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.
Environmental challenges
– Hierarchies Teams 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. Hierarchies Teams can take advantage of this fund but it will also bring new competitors in the Communication industry.
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.
