Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2
Describes the position of Utility #2 in negotiating Group A with respect to 1) its SO emissions reduction requirements; 2) the costs of its alternative compliance strategies; and 3) the nature of its state regulatory environment.
Swot Analysis of "Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2" written by Willis Emmons includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Utility 2 facing as an external strategic factors. Some of the topics covered in Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 case study are - Strategic Management Strategies, Decision making, Negotiations, Sustainability and Global Business.
Some of the macro environment factors that can be used to understand the Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 casestudy better are - – central banks are concerned over increasing inflation, cloud computing is disrupting traditional business models, there is backlash against globalization, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs, wage bills are increasing, increasing household debt because of falling income levels,
increasing energy prices, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Utility 2, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Utility 2 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 can be done for the following purposes –
1. Strategic planning using facts provided in Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 case study
2. Improving business portfolio management of Utility 2
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Utility 2
Strengths Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Utility 2 in Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 Harvard Business Review case study are -
Effective Research and Development (R&D)
– Utility 2 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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
– Utility 2 has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Utility 2 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.
Innovation driven organization
– Utility 2 is one of the most innovative firm in sector. Manager in Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Utility 2 is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Utility 2 is present in almost all the verticals within the industry. This has provided firm in Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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.
Sustainable margins compare to other players in Global Business industry
– Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 firm has clearly differentiated products in the market place. This has enabled Utility 2 to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Utility 2 to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Utility 2 is one of the leading recruiters in the industry. Managers in the Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Utility 2
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Utility 2 does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the Utility 2 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 Utility 2 in the sector have low bargaining power. Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Utility 2 to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Utility 2 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.
Weaknesses Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 are -
Lack of clear differentiation of Utility 2 products
– To increase the profitability and margins on the products, Utility 2 needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2, it seems that the employees of Utility 2 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 can leverage the sales team experience to cultivate customer relationships as Utility 2 is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2, is just above the industry average. Utility 2 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.
Capital Spending Reduction
– Even during the low interest decade, Utility 2 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.
Need for greater diversity
– Utility 2 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.
Interest costs
– Compare to the competition, Utility 2 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.
Slow decision making process
– As mentioned earlier in the report, Utility 2 has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Utility 2 even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2, in the dynamic environment Utility 2 has struggled to respond to the nimble upstart competition. Utility 2 has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Utility 2 supply chain. Even after few cautionary changes mentioned in the HBR case study - Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Utility 2 vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 HBR case study mentions - Utility 2 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.
Opportunities Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 | 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Utility 2 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 Utility 2 to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Utility 2 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Utility 2 can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Utility 2 is facing challenges because of the dominance of functional experts in the organization. Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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.
Leveraging digital technologies
– Utility 2 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
– Utility 2 can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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.
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. Utility 2 can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Better consumer reach
– The expansion of the 5G network will help Utility 2 to increase its market reach. Utility 2 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Utility 2 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, Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Utility 2 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Utility 2 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 Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Utility 2 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. Utility 2 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.
Manufacturing automation
– Utility 2 can use the latest technology developments to improve its manufacturing and designing process in Global Business 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.
Threats Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 are -
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 Utility 2.
Environmental challenges
– Utility 2 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. Utility 2 can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Shortening product life cycle
– it is one of the major threat that Utility 2 is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2, Utility 2 may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Stagnating economy with rate increase
– Utility 2 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.
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.
Increasing wage structure of Utility 2
– 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 Utility 2.
Technology acceleration in Forth Industrial Revolution
– Utility 2 has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Utility 2 needs to keep up with the evolution of technology in the Global Business 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.
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 Utility 2 business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Utility 2 can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
Consumer confidence and its impact on Utility 2 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.
Regulatory challenges
– Utility 2 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 Global Business industry regulations.
Weighted SWOT Analysis of Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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 Negotiation Exercise on Tradeable Pollution Allowances: Group A, Utility #2 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 Utility 2 needs to make to build a sustainable competitive advantage.