Steel Wars: A Battle for the Future of American Steel SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Steel Wars: A Battle for the Future of American Steel
Studies the impact of tariffs, subsidies, and quotas on the U.S. steel market. Focuses on "winners" and "losers" from different policies. Applications to the events in the U.S. steel market in 2001 illustrate the impact of these policies.
Authors :: Nabil Al-Najjar, Sandeep Baliga, Chris Forman
Swot Analysis of "Steel Wars: A Battle for the Future of American Steel" written by Nabil Al-Najjar, Sandeep Baliga, Chris Forman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Steel Policies facing as an external strategic factors. Some of the topics covered in Steel Wars: A Battle for the Future of American Steel case study are - Strategic Management Strategies, Regulation and Global Business.
Some of the macro environment factors that can be used to understand the Steel Wars: A Battle for the Future of American Steel casestudy better are - – cloud computing is disrupting traditional business models, increasing energy prices, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, there is increasing trade war between United States & China,
supply chains are disrupted by pandemic , increasing commodity prices, etc
Introduction to SWOT Analysis of Steel Wars: A Battle for the Future of American Steel
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Steel Wars: A Battle for the Future of American Steel case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Steel Policies, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Steel Policies 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 Steel Wars: A Battle for the Future of American Steel can be done for the following purposes –
1. Strategic planning using facts provided in Steel Wars: A Battle for the Future of American Steel case study
2. Improving business portfolio management of Steel Policies
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 Steel Policies
Strengths Steel Wars: A Battle for the Future of American Steel | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Steel Policies in Steel Wars: A Battle for the Future of American Steel Harvard Business Review case study are -
Strong track record of project management
– Steel Policies 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 Steel Policies
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Steel Policies does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Successful track record of launching new products
– Steel Policies has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Steel Policies 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.
Effective Research and Development (R&D)
– Steel Policies 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 Steel Wars: A Battle for the Future of American Steel - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Global Business industry
– Steel Wars: A Battle for the Future of American Steel firm has clearly differentiated products in the market place. This has enabled Steel Policies to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Steel Policies to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Steel Policies 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 Steel Wars: A Battle for the Future of American Steel HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Steel Policies 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.
Low bargaining power of suppliers
– Suppliers of Steel Policies in the sector have low bargaining power. Steel Wars: A Battle for the Future of American Steel has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Steel Policies to manage not only supply disruptions but also source products at highly competitive prices.
Ability to recruit top talent
– Steel Policies is one of the leading recruiters in the industry. Managers in the Steel Wars: A Battle for the Future of American Steel 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
– Steel Policies is one of the most innovative firm in sector. Manager in Steel Wars: A Battle for the Future of American Steel Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Steel Policies 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 Steel Policies is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Steel Wars: A Battle for the Future of American Steel Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Steel Wars: A Battle for the Future of American Steel 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.
Weaknesses Steel Wars: A Battle for the Future of American Steel | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Steel Wars: A Battle for the Future of American Steel are -
Workers concerns about automation
– As automation is fast increasing in the segment, Steel Policies 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.
Capital Spending Reduction
– Even during the low interest decade, Steel Policies 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.
Slow decision making process
– As mentioned earlier in the report, Steel Policies 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. Steel Policies 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.
Low market penetration in new markets
– Outside its home market of Steel Policies, firm in the HBR case study Steel Wars: A Battle for the Future of American Steel needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Nabil Al-Najjar, Sandeep Baliga, Chris Forman suggests that, Steel Policies 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.
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 Steel Policies supply chain. Even after few cautionary changes mentioned in the HBR case study - Steel Wars: A Battle for the Future of American Steel, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Steel Policies vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Steel Policies has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High operating costs
– Compare to the competitors, firm in the HBR case study Steel Wars: A Battle for the Future of American Steel 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 Steel Policies 's lucrative customers.
Lack of clear differentiation of Steel Policies products
– To increase the profitability and margins on the products, Steel Policies needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Steel Wars: A Battle for the Future of American Steel HBR case study mentions - Steel Policies 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Steel Wars: A Battle for the Future of American Steel, it seems that the employees of Steel Policies 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.
Opportunities Steel Wars: A Battle for the Future of American Steel | 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 Steel Wars: A Battle for the Future of American Steel are -
Buying journey improvements
– Steel Policies can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Steel Wars: A Battle for the Future of American Steel 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Steel Policies 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 Steel Policies has opened avenues for new revenue streams for the organization in the industry. This can help Steel Policies to build a more holistic ecosystem as suggested in the Steel Wars: A Battle for the Future of American Steel case study. Steel Policies can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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. Steel Policies can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Leveraging digital technologies
– Steel Policies 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Steel Policies 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, Steel Wars: A Battle for the Future of American Steel, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Steel Policies is facing challenges because of the dominance of functional experts in the organization. Steel Wars: A Battle for the Future of American Steel 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
– Steel Policies 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.
Learning at scale
– Online learning technologies has now opened space for Steel Policies 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Steel Policies can use these opportunities to build new business models that can help the communities that Steel Policies operates in. Secondly it can use opportunities from government spending in Global Business sector.
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. Steel Policies 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. Steel Policies 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Steel Policies 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 Steel Policies to hire the very best people irrespective of their geographical location.
Low interest rates
– Even though inflation is raising its head in most developed economies, Steel Policies 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.
Threats Steel Wars: A Battle for the Future of American Steel External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Steel Wars: A Battle for the Future of American Steel are -
Consumer confidence and its impact on Steel Policies 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.
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. Steel Policies 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.
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. Steel Policies needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Environmental challenges
– Steel Policies 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. Steel Policies can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Regulatory challenges
– Steel Policies 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.
Shortening product life cycle
– it is one of the major threat that Steel Policies is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Steel Policies 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Steel Wars: A Battle for the Future of American Steel, Steel Policies 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 .
High dependence on third party suppliers
– Steel Policies 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.
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 Steel Policies.
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 Steel Policies in the Global Business sector and impact the bottomline of the organization.
Technology acceleration in Forth Industrial Revolution
– Steel Policies has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Steel Policies 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.
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 Steel Wars: A Battle for the Future of American Steel 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 Steel Wars: A Battle for the Future of American Steel 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 Steel Wars: A Battle for the Future of American Steel 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 Steel Wars: A Battle for the Future of American Steel 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 Steel Wars: A Battle for the Future of American Steel 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 Steel Policies needs to make to build a sustainable competitive advantage.
