Case Study Description of Recall 2000: Bridgestone Corp. (A)
In September 2000, the president of Bridgestone-Firestone, the U.S. subsidiary of Japan's Bridgestone Corp., was invited to appear before a U.S. congressional subcommittee investigating the August 2000 recall of more than 6.5 million tires made by the subsidiary. The tires had been implicated in several hundred auto accidents and dozens of fatalities in the United States and elsewhere around the globe. This case depicts the tire controversy and the decisions it posed for Bridgestone's management. Tracing Bridgestone's evolution from a regional multinational to a global player by way of acquiring Firestone, a U.S. tire maker founded in 1900, the case shows how cultural differences between the two business systems played a part in creating the situation and in shaping Bridgestone/Firestone's responses to it. A rewritten version of an earlier case.
Swot Analysis of "Recall 2000: Bridgestone Corp. (A)" written by Lynn Sharp Paine includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bridgestone Bridgestone's facing as an external strategic factors. Some of the topics covered in Recall 2000: Bridgestone Corp. (A) case study are - Strategic Management Strategies, Crisis management, Cross-cultural management, Organizational culture, Social responsibility and Global Business.
Some of the macro environment factors that can be used to understand the Recall 2000: Bridgestone Corp. (A) casestudy better are - – talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, increasing commodity prices, technology disruption,
there is backlash against globalization, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Recall 2000: Bridgestone Corp. (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Recall 2000: Bridgestone Corp. (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bridgestone Bridgestone's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bridgestone Bridgestone's operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Recall 2000: Bridgestone Corp. (A) can be done for the following purposes –
1. Strategic planning using facts provided in Recall 2000: Bridgestone Corp. (A) case study
2. Improving business portfolio management of Bridgestone Bridgestone's
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 Bridgestone Bridgestone's
Strengths Recall 2000: Bridgestone Corp. (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bridgestone Bridgestone's in Recall 2000: Bridgestone Corp. (A) Harvard Business Review case study are -
Organizational Resilience of Bridgestone Bridgestone's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bridgestone Bridgestone's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Bridgestone Bridgestone's has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Recall 2000: Bridgestone Corp. (A) - 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 Recall 2000: Bridgestone Corp. (A) 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.
Superior customer experience
– The customer experience strategy of Bridgestone Bridgestone's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Bridgestone Bridgestone's is one of the most innovative firm in sector. Manager in Recall 2000: Bridgestone Corp. (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Analytics focus
– Bridgestone Bridgestone's is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Lynn Sharp Paine can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Bridgestone Bridgestone's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bridgestone Bridgestone's has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Learning organization
- Bridgestone Bridgestone's is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Bridgestone Bridgestone's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Recall 2000: Bridgestone Corp. (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Training and development
– Bridgestone Bridgestone's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Recall 2000: Bridgestone Corp. (A) 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.
Cross disciplinary teams
– Horizontal connected teams at the Bridgestone Bridgestone's are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Low bargaining power of suppliers
– Suppliers of Bridgestone Bridgestone's in the sector have low bargaining power. Recall 2000: Bridgestone Corp. (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bridgestone Bridgestone's to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Bridgestone Bridgestone's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bridgestone Bridgestone's 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.
Weaknesses Recall 2000: Bridgestone Corp. (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Recall 2000: Bridgestone Corp. (A) are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Recall 2000: Bridgestone Corp. (A), is just above the industry average. Bridgestone Bridgestone's needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
No frontier risks strategy
– After analyzing the HBR case study Recall 2000: Bridgestone Corp. (A), 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.
Slow decision making process
– As mentioned earlier in the report, Bridgestone Bridgestone's 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. Bridgestone Bridgestone's 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.
Products dominated business model
– Even though Bridgestone Bridgestone's 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 - Recall 2000: Bridgestone Corp. (A) should strive to include more intangible value offerings along with its core products and services.
Need for greater diversity
– Bridgestone Bridgestone's has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Low market penetration in new markets
– Outside its home market of Bridgestone Bridgestone's, firm in the HBR case study Recall 2000: Bridgestone Corp. (A) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Lynn Sharp Paine suggests that, Bridgestone Bridgestone's 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.
Skills based hiring
– The stress on hiring functional specialists at Bridgestone Bridgestone's 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.
Slow to strategic competitive environment developments
– As Recall 2000: Bridgestone Corp. (A) HBR case study mentions - Bridgestone Bridgestone's takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Increasing silos among functional specialists
– The organizational structure of Bridgestone Bridgestone's is dominated by functional specialists. It is not different from other players in the Global Business segment. Bridgestone Bridgestone's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bridgestone Bridgestone's to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Recall 2000: Bridgestone Corp. (A) 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 Bridgestone Bridgestone's has relatively successful track record of launching new products.
Opportunities Recall 2000: Bridgestone Corp. (A) | 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 Recall 2000: Bridgestone Corp. (A) are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bridgestone Bridgestone's 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 Bridgestone Bridgestone's 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, Bridgestone Bridgestone's can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
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 Bridgestone Bridgestone's to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Using analytics as competitive advantage
– Bridgestone Bridgestone's 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 Recall 2000: Bridgestone Corp. (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bridgestone Bridgestone's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Bridgestone Bridgestone's has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, 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. Bridgestone Bridgestone's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Bridgestone Bridgestone's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Bridgestone Bridgestone's in the consumer business. Now Bridgestone Bridgestone's can target international markets with far fewer capital restrictions requirements than the existing system.
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. Bridgestone Bridgestone's 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. Bridgestone Bridgestone's 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, Bridgestone Bridgestone's can use these opportunities to build new business models that can help the communities that Bridgestone Bridgestone's operates in. Secondly it can use opportunities from government spending in Global Business sector.
Buying journey improvements
– Bridgestone Bridgestone's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Recall 2000: Bridgestone Corp. (A) 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.
Creating value in data economy
– The success of analytics program of Bridgestone Bridgestone's has opened avenues for new revenue streams for the organization in the industry. This can help Bridgestone Bridgestone's to build a more holistic ecosystem as suggested in the Recall 2000: Bridgestone Corp. (A) case study. Bridgestone Bridgestone's 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. Bridgestone Bridgestone's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Recall 2000: Bridgestone Corp. (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Recall 2000: Bridgestone Corp. (A) are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Recall 2000: Bridgestone Corp. (A), Bridgestone Bridgestone's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
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 Bridgestone Bridgestone's business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Bridgestone Bridgestone's
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Bridgestone Bridgestone's.
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.
Technology acceleration in Forth Industrial Revolution
– Bridgestone Bridgestone's has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Bridgestone Bridgestone's 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.
High dependence on third party suppliers
– Bridgestone Bridgestone's high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bridgestone Bridgestone's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Consumer confidence and its impact on Bridgestone Bridgestone's 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.
Stagnating economy with rate increase
– Bridgestone Bridgestone's 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.
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. Bridgestone Bridgestone's 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.
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 Bridgestone Bridgestone's.
Shortening product life cycle
– it is one of the major threat that Bridgestone Bridgestone's is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Bridgestone Bridgestone's needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Weighted SWOT Analysis of Recall 2000: Bridgestone Corp. (A) 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 Recall 2000: Bridgestone Corp. (A) 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 Recall 2000: Bridgestone Corp. (A) 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 Recall 2000: Bridgestone Corp. (A) 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 Recall 2000: Bridgestone Corp. (A) 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 Bridgestone Bridgestone's needs to make to build a sustainable competitive advantage.
