Ribe Maskinfabrik A/S - Developing New Business Areas SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Ribe Maskinfabrik A/S - Developing New Business Areas
Ribe Maskinfabrik A/S (RM) had, during the last 15 years, developed from a simple machine works operating out of Southern Jutland (Denmark) to the modern and globalized RM Group consisting of three distinct business units. This change had developed gradually as its outsourcing activities became increasingly important during the last years. In the beginning, outsourcing activities developed in an ad-hoc and reactive manner. However, RM gained important knowledge on how to optimize the outsourcing processes, and it developed a very extensive network of suppliers, many of which it had relationships with for many years. This network was offered to RM's customers and represented a high value to them. RM had already established these contacts and was able to assure the quality of its partners, which saved its customers valuable time and effort. In that sense, RM exploited its own experience and network of suppliers and became an outsourcing consultant.
Authors :: Bo Nielsen, Torben Pedersen, Jacob Pyndt
Swot Analysis of "Ribe Maskinfabrik A/S - Developing New Business Areas" written by Bo Nielsen, Torben Pedersen, Jacob Pyndt includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Rm Maskinfabrik facing as an external strategic factors. Some of the topics covered in Ribe Maskinfabrik A/S - Developing New Business Areas case study are - Strategic Management Strategies, Networking, Strategy, Supply chain and Global Business.
Some of the macro environment factors that can be used to understand the Ribe Maskinfabrik A/S - Developing New Business Areas casestudy better are - – increasing household debt because of falling income levels, increasing inequality as vast percentage of new income is going to the top 1%, increasing government debt because of Covid-19 spendings, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, geopolitical disruptions,
customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, etc
Introduction to SWOT Analysis of Ribe Maskinfabrik A/S - Developing New Business Areas
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ribe Maskinfabrik A/S - Developing New Business Areas case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Rm Maskinfabrik, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Rm Maskinfabrik 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 Ribe Maskinfabrik A/S - Developing New Business Areas can be done for the following purposes –
1. Strategic planning using facts provided in Ribe Maskinfabrik A/S - Developing New Business Areas case study
2. Improving business portfolio management of Rm Maskinfabrik
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 Rm Maskinfabrik
Strengths Ribe Maskinfabrik A/S - Developing New Business Areas | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Rm Maskinfabrik in Ribe Maskinfabrik A/S - Developing New Business Areas Harvard Business Review case study are -
Organizational Resilience of Rm Maskinfabrik
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Rm Maskinfabrik 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
– Rm Maskinfabrik has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Rm Maskinfabrik 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
– Rm Maskinfabrik is one of the most innovative firm in sector. Manager in Ribe Maskinfabrik A/S - Developing New Business Areas Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Global Business field
– Rm Maskinfabrik is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Rm Maskinfabrik in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Rm Maskinfabrik has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Rm Maskinfabrik to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
High switching costs
– The high switching costs that Rm Maskinfabrik 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Rm Maskinfabrik digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Rm Maskinfabrik 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.
Cross disciplinary teams
– Horizontal connected teams at the Rm Maskinfabrik 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.
Diverse revenue streams
– Rm Maskinfabrik is present in almost all the verticals within the industry. This has provided firm in Ribe Maskinfabrik A/S - Developing New Business Areas 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
– Rm Maskinfabrik is one of the leading recruiters in the industry. Managers in the Ribe Maskinfabrik A/S - Developing New Business Areas are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Effective Research and Development (R&D)
– Rm Maskinfabrik 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 Ribe Maskinfabrik A/S - Developing New Business Areas - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Strong track record of project management
– Rm Maskinfabrik is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Ribe Maskinfabrik A/S - Developing New Business Areas | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ribe Maskinfabrik A/S - Developing New Business Areas are -
Need for greater diversity
– Rm Maskinfabrik 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.
Aligning sales with marketing
– It come across in the case study Ribe Maskinfabrik A/S - Developing New Business Areas 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 Ribe Maskinfabrik A/S - Developing New Business Areas can leverage the sales team experience to cultivate customer relationships as Rm Maskinfabrik is planning to shift buying processes online.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Ribe Maskinfabrik A/S - Developing New Business Areas, it seems that the employees of Rm Maskinfabrik 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.
No frontier risks strategy
– After analyzing the HBR case study Ribe Maskinfabrik A/S - Developing New Business Areas, it seems that company is thinking about the frontier risks that can impact Global Business strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Skills based hiring
– The stress on hiring functional specialists at Rm Maskinfabrik 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.
Lack of clear differentiation of Rm Maskinfabrik products
– To increase the profitability and margins on the products, Rm Maskinfabrik needs to provide more differentiated products than what it is currently offering in the marketplace.
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 Rm Maskinfabrik supply chain. Even after few cautionary changes mentioned in the HBR case study - Ribe Maskinfabrik A/S - Developing New Business Areas, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Rm Maskinfabrik vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Ribe Maskinfabrik A/S - Developing New Business Areas 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 Rm Maskinfabrik has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Bo Nielsen, Torben Pedersen, Jacob Pyndt suggests that, Rm Maskinfabrik 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Ribe Maskinfabrik A/S - Developing New Business Areas, in the dynamic environment Rm Maskinfabrik has struggled to respond to the nimble upstart competition. Rm Maskinfabrik has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Rm Maskinfabrik 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.
Opportunities Ribe Maskinfabrik A/S - Developing New Business Areas | 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 Ribe Maskinfabrik A/S - Developing New Business Areas are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Rm Maskinfabrik is facing challenges because of the dominance of functional experts in the organization. Ribe Maskinfabrik A/S - Developing New Business Areas 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.
Using analytics as competitive advantage
– Rm Maskinfabrik has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Ribe Maskinfabrik A/S - Developing New Business Areas - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Rm Maskinfabrik to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Rm Maskinfabrik 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.
Manufacturing automation
– Rm Maskinfabrik 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.
Learning at scale
– Online learning technologies has now opened space for Rm Maskinfabrik 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.
Buying journey improvements
– Rm Maskinfabrik can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Ribe Maskinfabrik A/S - Developing New Business Areas 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.
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. Rm Maskinfabrik 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. Rm Maskinfabrik 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Rm Maskinfabrik can use these opportunities to build new business models that can help the communities that Rm Maskinfabrik operates in. Secondly it can use opportunities from government spending in Global Business sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Rm Maskinfabrik 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, Ribe Maskinfabrik A/S - Developing New Business Areas, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Rm Maskinfabrik 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.
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 Rm Maskinfabrik 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.
Leveraging digital technologies
– Rm Maskinfabrik 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.
Developing new processes and practices
– Rm Maskinfabrik 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.
Threats Ribe Maskinfabrik A/S - Developing New Business Areas External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ribe Maskinfabrik A/S - Developing New Business Areas are -
High dependence on third party suppliers
– Rm Maskinfabrik 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.
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 Rm Maskinfabrik 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. Rm Maskinfabrik can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Rm Maskinfabrik 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. Rm Maskinfabrik can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Rm Maskinfabrik 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.
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. Rm Maskinfabrik 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 international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Rm Maskinfabrik 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 Ribe Maskinfabrik A/S - Developing New Business Areas .
Shortening product life cycle
– it is one of the major threat that Rm Maskinfabrik 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 Ribe Maskinfabrik A/S - Developing New Business Areas, Rm Maskinfabrik 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 .
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
– Rm Maskinfabrik has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Rm Maskinfabrik 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.
Increasing wage structure of Rm Maskinfabrik
– 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 Rm Maskinfabrik.
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 Ribe Maskinfabrik A/S - Developing New Business Areas 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 Ribe Maskinfabrik A/S - Developing New Business Areas 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 Ribe Maskinfabrik A/S - Developing New Business Areas 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 Ribe Maskinfabrik A/S - Developing New Business Areas 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 Ribe Maskinfabrik A/S - Developing New Business Areas 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 Rm Maskinfabrik needs to make to build a sustainable competitive advantage.