Swot Analysis of "Offshore Corporations: A Brief Introduction" written by Robert E. Kennedy, Brian P. Irwin includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Offshore Corporations facing as an external strategic factors. Some of the topics covered in Offshore Corporations: A Brief Introduction case study are - Strategic Management Strategies, Operations management, Policy and Global Business.
Some of the macro environment factors that can be used to understand the Offshore Corporations: A Brief Introduction casestudy better are - – there is backlash against globalization, increasing energy prices, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, central banks are concerned over increasing inflation, supply chains are disrupted by pandemic ,
customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Offshore Corporations: A Brief Introduction
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Offshore Corporations: A Brief Introduction case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Offshore Corporations, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Offshore Corporations 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 Offshore Corporations: A Brief Introduction can be done for the following purposes –
1. Strategic planning using facts provided in Offshore Corporations: A Brief Introduction case study
2. Improving business portfolio management of Offshore Corporations
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 Offshore Corporations
Strengths Offshore Corporations: A Brief Introduction | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Offshore Corporations in Offshore Corporations: A Brief Introduction Harvard Business Review case study are -
Highly skilled collaborators
– Offshore Corporations 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 Offshore Corporations: A Brief Introduction HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Offshore Corporations: A Brief Introduction 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
– Offshore Corporations has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Offshore Corporations 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.
Strong track record of project management
– Offshore Corporations is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of Offshore Corporations
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Offshore Corporations does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Offshore Corporations 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 Offshore Corporations: A Brief Introduction - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Offshore Corporations is one of the most innovative firm in sector. Manager in Offshore Corporations: A Brief Introduction Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Offshore Corporations has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Offshore Corporations: A Brief Introduction 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.
Ability to recruit top talent
– Offshore Corporations is one of the leading recruiters in the industry. Managers in the Offshore Corporations: A Brief Introduction are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Offshore Corporations is present in almost all the verticals within the industry. This has provided firm in Offshore Corporations: A Brief Introduction 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.
High brand equity
– Offshore Corporations has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Offshore Corporations to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Sustainable margins compare to other players in Global Business industry
– Offshore Corporations: A Brief Introduction firm has clearly differentiated products in the market place. This has enabled Offshore Corporations to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Offshore Corporations to invest into research and development (R&D) and innovation.
Weaknesses Offshore Corporations: A Brief Introduction | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Offshore Corporations: A Brief Introduction are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Offshore Corporations: A Brief Introduction 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 Offshore Corporations has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Offshore Corporations is dominated by functional specialists. It is not different from other players in the Global Business segment. Offshore Corporations needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Offshore Corporations to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Offshore Corporations: A Brief Introduction 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 Offshore Corporations: A Brief Introduction can leverage the sales team experience to cultivate customer relationships as Offshore Corporations is planning to shift buying processes online.
Need for greater diversity
– Offshore Corporations 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.
High cash cycle compare to competitors
Offshore Corporations 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Offshore Corporations: A Brief Introduction, is just above the industry average. Offshore Corporations 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.
Skills based hiring
– The stress on hiring functional specialists at Offshore Corporations has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Offshore Corporations 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Offshore Corporations: A Brief Introduction 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 Offshore Corporations 's lucrative customers.
Low market penetration in new markets
– Outside its home market of Offshore Corporations, firm in the HBR case study Offshore Corporations: A Brief Introduction needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Products dominated business model
– Even though Offshore Corporations 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 - Offshore Corporations: A Brief Introduction should strive to include more intangible value offerings along with its core products and services.
Opportunities Offshore Corporations: A Brief Introduction | 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 Offshore Corporations: A Brief Introduction are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Offshore Corporations 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Offshore Corporations 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, Offshore Corporations is facing challenges because of the dominance of functional experts in the organization. Offshore Corporations: A Brief Introduction 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.
Developing new processes and practices
– Offshore Corporations can develop new processes and procedures in Global Business industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Offshore Corporations in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Creating value in data economy
– The success of analytics program of Offshore Corporations has opened avenues for new revenue streams for the organization in the industry. This can help Offshore Corporations to build a more holistic ecosystem as suggested in the Offshore Corporations: A Brief Introduction case study. Offshore Corporations can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Offshore Corporations can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Offshore Corporations 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 Offshore Corporations to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Offshore Corporations to increase its market reach. Offshore Corporations 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.
Learning at scale
– Online learning technologies has now opened space for Offshore Corporations 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.
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 Offshore Corporations in the consumer business. Now Offshore Corporations can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Offshore Corporations 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.
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 Offshore Corporations 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 Offshore Corporations: A Brief Introduction External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Offshore Corporations: A Brief Introduction are -
Regulatory challenges
– Offshore Corporations 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.
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.
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. Offshore Corporations 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 Offshore Corporations
– 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 Offshore Corporations.
High dependence on third party suppliers
– Offshore Corporations 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Offshore Corporations in the Global Business industry. The Global Business 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.
Environmental challenges
– Offshore Corporations 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. Offshore Corporations can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Stagnating economy with rate increase
– Offshore Corporations 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.
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. Offshore Corporations can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Offshore Corporations in the Global Business 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 Offshore Corporations business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Offshore Corporations with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Weighted SWOT Analysis of Offshore Corporations: A Brief Introduction 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 Offshore Corporations: A Brief Introduction 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 Offshore Corporations: A Brief Introduction 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 Offshore Corporations: A Brief Introduction 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 Offshore Corporations: A Brief Introduction 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 Offshore Corporations needs to make to build a sustainable competitive advantage.