Winning With Open Process Innovation SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Winning With Open Process Innovation
This is an MIT Sloan Management Review article. Most research on open innovation has focused on the use of ideas and knowledge from outside the organization in the development of products and services. But openness can be useful for process innovation, too. The authors' research shows that manufacturers can benefit substantially when they look for ideas beyond the factory gates, especially when their operations are already advanced. In this article, the authors analyzed nine years of survey responses from 1,000 Swiss manufacturers, as well as 200 interviews with personnel at the Volvo Group (AB Volvo), a manufacturer of trucks, buses, construction equipment, and marine and industrial engines that is based in Gothenburg, Sweden. Although the authors concede that some companies have good reasons for keeping process innovations concealed, they found that for many manufacturers, such defensiveness deprives companies of a valuable source of ideas for productivity improvement. The authors present six ideas to help manufacturing companies open up their innovation process. The first idea is to encourage factories within a large company to share innovative practices and success stories with one another. Companies that already do this informally, the authors say, can extend their activities with a systematic effort inside their factory networks and lay the groundwork for other open information sharing about processes. The second idea is to focus on the pace of process improvement. The third idea is to recognize that increased use of data access systems leads to greater production cost reductions. Customer relationship management, supply chain management, and enterprise resource planning software systems all require codification of tacit knowledge, which enhances a company's capacity to spread external process ideas and technology to the people who need it. As a fourth step, the authors recommend improving the organization's ability to absorb and implement ideas from external sources. A good way to achieve this, they say, is to establish routines for gathering ideas from external sources and putting them to use. Fifth, the authors advise reaching beyond a company's internal factory networks for inspiration. Finally, they say companies should remember that "nontraditional sources of knowledge may spark process innovation and help overcome difficult problems."
Authors :: Georg von Krogh, Torbjorn Netland, Martin Worter
Swot Analysis of "Winning With Open Process Innovation" written by Georg von Krogh, Torbjorn Netland, Martin Worter includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ideas Authors facing as an external strategic factors. Some of the topics covered in Winning With Open Process Innovation case study are - Strategic Management Strategies, Knowledge management and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Winning With Open Process Innovation casestudy better are - – talent flight as more people leaving formal jobs, competitive advantages are harder to sustain because of technology dispersion, challanges to central banks by blockchain based private currencies, digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models,
customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Winning With Open Process Innovation
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Winning With Open Process Innovation case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ideas Authors, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ideas Authors 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 Winning With Open Process Innovation can be done for the following purposes –
1. Strategic planning using facts provided in Winning With Open Process Innovation case study
2. Improving business portfolio management of Ideas Authors
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ideas Authors
Strengths Winning With Open Process Innovation | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ideas Authors in Winning With Open Process Innovation Harvard Business Review case study are -
Ability to lead change in Leadership & Managing People field
– Ideas Authors 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 Ideas Authors in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High switching costs
– The high switching costs that Ideas Authors 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.
Operational resilience
– The operational resilience strategy in the Winning With Open Process Innovation 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.
Training and development
– Ideas Authors has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Winning With Open Process Innovation 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
– Ideas Authors 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 Georg von Krogh, Torbjorn Netland, Martin Worter 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.
Ability to recruit top talent
– Ideas Authors is one of the leading recruiters in the industry. Managers in the Winning With Open Process Innovation are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Innovation driven organization
– Ideas Authors is one of the most innovative firm in sector. Manager in Winning With Open Process Innovation Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Superior customer experience
– The customer experience strategy of Ideas Authors in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Ideas Authors
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ideas Authors does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Learning organization
- Ideas Authors 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 Ideas Authors is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Winning With Open Process Innovation Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Ideas Authors 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 Ideas Authors in the sector have low bargaining power. Winning With Open Process Innovation has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ideas Authors to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Winning With Open Process Innovation | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Winning With Open Process Innovation are -
Increasing silos among functional specialists
– The organizational structure of Ideas Authors is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Ideas Authors needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ideas Authors to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Winning With Open Process Innovation 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 Winning With Open Process Innovation can leverage the sales team experience to cultivate customer relationships as Ideas Authors is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Georg von Krogh, Torbjorn Netland, Martin Worter suggests that, Ideas Authors 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.
Interest costs
– Compare to the competition, Ideas Authors 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Winning With Open Process Innovation, in the dynamic environment Ideas Authors has struggled to respond to the nimble upstart competition. Ideas Authors has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study Winning With Open Process Innovation, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High operating costs
– Compare to the competitors, firm in the HBR case study Winning With Open Process Innovation 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 Ideas Authors 's lucrative customers.
Lack of clear differentiation of Ideas Authors products
– To increase the profitability and margins on the products, Ideas Authors needs to provide more differentiated products than what it is currently offering in the marketplace.
Products dominated business model
– Even though Ideas Authors 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 - Winning With Open Process Innovation should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Ideas Authors 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.
Low market penetration in new markets
– Outside its home market of Ideas Authors, firm in the HBR case study Winning With Open Process Innovation needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Opportunities Winning With Open Process Innovation | 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 Winning With Open Process Innovation are -
Using analytics as competitive advantage
– Ideas Authors 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 Winning With Open Process Innovation - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ideas Authors to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ideas Authors 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 Ideas Authors to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ideas Authors can use these opportunities to build new business models that can help the communities that Ideas Authors operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Ideas Authors can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ideas Authors 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. Ideas Authors 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.
Building a culture of innovation
– managers at Ideas Authors 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 Leadership & Managing People segment.
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 Ideas Authors in the consumer business. Now Ideas Authors can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Ideas Authors can develop new processes and procedures in Leadership & Managing People 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.
Buying journey improvements
– Ideas Authors can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Winning With Open Process Innovation 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ideas Authors can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Creating value in data economy
– The success of analytics program of Ideas Authors has opened avenues for new revenue streams for the organization in the industry. This can help Ideas Authors to build a more holistic ecosystem as suggested in the Winning With Open Process Innovation case study. Ideas Authors can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Ideas Authors is facing challenges because of the dominance of functional experts in the organization. Winning With Open Process Innovation case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
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 Ideas Authors 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.
Threats Winning With Open Process Innovation External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Winning With Open Process Innovation are -
Environmental challenges
– Ideas Authors 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. Ideas Authors can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
Increasing wage structure of Ideas Authors
– 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 Ideas Authors.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ideas Authors with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Ideas Authors 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 Leadership & Managing People industry regulations.
Technology acceleration in Forth Industrial Revolution
– Ideas Authors has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Ideas Authors needs to keep up with the evolution of technology in the Leadership & Managing People 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 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. Ideas Authors needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Ideas Authors 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.
Shortening product life cycle
– it is one of the major threat that Ideas Authors is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ideas Authors 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 Winning With Open Process Innovation .
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 Ideas Authors business can come under increasing regulations regarding data privacy, data security, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Ideas Authors in the Leadership & Managing People sector and impact the bottomline of the organization.
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 Ideas Authors.
Consumer confidence and its impact on Ideas Authors 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.
Weighted SWOT Analysis of Winning With Open Process Innovation 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 Winning With Open Process Innovation 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 Winning With Open Process Innovation 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 Winning With Open Process Innovation 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 Winning With Open Process Innovation 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 Ideas Authors needs to make to build a sustainable competitive advantage.