Delta Air Lines: The Latin America Contact Center Decision SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Delta Air Lines: The Latin America Contact Center Decision
This is a Thunderbird Case Study.Delta Air Lines has decided to consolidate its reservations centers in Latin America into one regional office. This new consolidated office will be Delta's Latin America Contact Center, handling reservations for the entire Latin American region. The executives on Delta's site selection team have narrowed down the company's choices of a location for this Center to three options: Mexico City, Mexico; Buenos Aires, Argentina; and Santiago, Chile. Mary Smith will be helping to make the recommendation as to the country where Delta should choose.
Swot Analysis of "Delta Air Lines: The Latin America Contact Center Decision" written by Roy C. Nelson includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Latin Delta's facing as an external strategic factors. Some of the topics covered in Delta Air Lines: The Latin America Contact Center Decision case study are - Strategic Management Strategies, and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Delta Air Lines: The Latin America Contact Center Decision casestudy better are - – technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, geopolitical disruptions, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, central banks are concerned over increasing inflation,
there is backlash against globalization, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Delta Air Lines: The Latin America Contact Center Decision
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Delta Air Lines: The Latin America Contact Center Decision case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Latin Delta's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Latin Delta's operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Delta Air Lines: The Latin America Contact Center Decision can be done for the following purposes –
1. Strategic planning using facts provided in Delta Air Lines: The Latin America Contact Center Decision case study
2. Improving business portfolio management of Latin Delta's
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Latin Delta's
Strengths Delta Air Lines: The Latin America Contact Center Decision | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Latin Delta's in Delta Air Lines: The Latin America Contact Center Decision Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Latin Delta's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Latin Delta's is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Latin Delta's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Delta Air Lines: The Latin America Contact Center Decision Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Latin Delta's 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 Delta Air Lines: The Latin America Contact Center Decision - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Latin Delta's is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Roy C. Nelson can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Cross disciplinary teams
– Horizontal connected teams at the Latin Delta's are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Low bargaining power of suppliers
– Suppliers of Latin Delta's in the sector have low bargaining power. Delta Air Lines: The Latin America Contact Center Decision has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Latin Delta's to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Latin Delta's is present in almost all the verticals within the industry. This has provided firm in Delta Air Lines: The Latin America Contact Center Decision 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
– Latin Delta's is one of the leading recruiters in the industry. Managers in the Delta Air Lines: The Latin America Contact Center Decision are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Latin Delta's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Finance & Accounting segment
- digital transformation varies from industry to industry. For Latin Delta's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Latin Delta's 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.
Training and development
– Latin Delta's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Delta Air Lines: The Latin America Contact Center Decision 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.
Sustainable margins compare to other players in Finance & Accounting industry
– Delta Air Lines: The Latin America Contact Center Decision firm has clearly differentiated products in the market place. This has enabled Latin Delta's to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Latin Delta's to invest into research and development (R&D) and innovation.
Weaknesses Delta Air Lines: The Latin America Contact Center Decision | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Delta Air Lines: The Latin America Contact Center Decision are -
Slow to strategic competitive environment developments
– As Delta Air Lines: The Latin America Contact Center Decision HBR case study mentions - Latin Delta's 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Delta Air Lines: The Latin America Contact Center Decision, is just above the industry average. Latin Delta's needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Delta Air Lines: The Latin America Contact Center Decision HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Latin Delta's has relatively successful track record of launching new products.
Low market penetration in new markets
– Outside its home market of Latin Delta's, firm in the HBR case study Delta Air Lines: The Latin America Contact Center Decision 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, Latin Delta's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Delta Air Lines: The Latin America Contact Center Decision 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 cash cycle compare to competitors
Latin Delta's 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.
Capital Spending Reduction
– Even during the low interest decade, Latin Delta's 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 Latin Delta's is dominated by functional specialists. It is not different from other players in the Finance & Accounting segment. Latin Delta's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Latin Delta's to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Latin Delta's needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Need for greater diversity
– Latin Delta's has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Delta Air Lines: The Latin America Contact Center Decision, in the dynamic environment Latin Delta's has struggled to respond to the nimble upstart competition. Latin Delta's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Delta Air Lines: The Latin America Contact Center Decision | 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 Delta Air Lines: The Latin America Contact Center Decision are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Latin Delta's is facing challenges because of the dominance of functional experts in the organization. Delta Air Lines: The Latin America Contact Center Decision 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 Latin Delta's to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Learning at scale
– Online learning technologies has now opened space for Latin Delta's to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Finance & Accounting industry, but it has also influenced the consumer preferences. Latin Delta's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Latin Delta's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, Latin Delta's 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.
Developing new processes and practices
– Latin Delta's can develop new processes and procedures in Finance & Accounting 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.
Manufacturing automation
– Latin Delta's can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Latin Delta's can use these opportunities to build new business models that can help the communities that Latin Delta's operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Better consumer reach
– The expansion of the 5G network will help Latin Delta's to increase its market reach. Latin Delta's will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Leveraging digital technologies
– Latin Delta's can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Building a culture of innovation
– managers at Latin Delta's can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.
Buying journey improvements
– Latin Delta's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Delta Air Lines: The Latin America Contact Center Decision 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 Delta Air Lines: The Latin America Contact Center Decision External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Delta Air Lines: The Latin America Contact Center Decision are -
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 Latin Delta's in the Finance & Accounting sector and impact the bottomline of the organization.
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 Latin Delta's business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Latin Delta's
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Latin Delta's.
Regulatory challenges
– Latin Delta's needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Finance & Accounting industry regulations.
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.
Technology acceleration in Forth Industrial Revolution
– Latin Delta's has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Latin Delta's needs to keep up with the evolution of technology in the Finance & Accounting 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Latin Delta's 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 Delta Air Lines: The Latin America Contact Center Decision .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Latin Delta's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Delta Air Lines: The Latin America Contact Center Decision, Latin Delta's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
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 Latin Delta's.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Latin Delta's in the Finance & Accounting industry. The Finance & Accounting 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 dependence on third party suppliers
– Latin Delta's high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
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.
Weighted SWOT Analysis of Delta Air Lines: The Latin America Contact Center Decision 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 Delta Air Lines: The Latin America Contact Center Decision 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 Delta Air Lines: The Latin America Contact Center Decision 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 Delta Air Lines: The Latin America Contact Center Decision 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 Delta Air Lines: The Latin America Contact Center Decision 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 Latin Delta's needs to make to build a sustainable competitive advantage.
