GM in China - Abridged SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of GM in China - Abridged
For General Motors (GM) China, 2004 brought a wide variety of new challenges that added to an already complex business environment. Industry structure was changing quickly, demand and supply projections for motor vehicles had promised substantial increases in sales and profits but suddenly optimism faded. China's membership in the World Trade Organization created expectations of a level playing field for foreign investors, but major barriers remained, including continuing government intervention, competition from government-owned assembly firms, arbitrary rules such as sector-specific credit restrictions and violation of intellectual property with the copying of foreign automobile designs and false-branding of parts. Meanwhile, inflation was increasing and the government was unsure whether and how to use monetary and fiscal policies. This is an abridged version of GM in China, product 905M07.
Swot Analysis of "GM in China - Abridged" written by David W. Conklin, Danielle Cadieux includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Gm 905m07 facing as an external strategic factors. Some of the topics covered in GM in China - Abridged case study are - Strategic Management Strategies, Globalization, Manufacturing and Global Business.
Some of the macro environment factors that can be used to understand the GM in China - Abridged casestudy better are - – there is increasing trade war between United States & China, technology disruption, central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, geopolitical disruptions,
increasing energy prices, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of GM in China - Abridged
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in GM in China - Abridged case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Gm 905m07, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Gm 905m07 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 GM in China - Abridged can be done for the following purposes –
1. Strategic planning using facts provided in GM in China - Abridged case study
2. Improving business portfolio management of Gm 905m07
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 Gm 905m07
Strengths GM in China - Abridged | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Gm 905m07 in GM in China - Abridged Harvard Business Review case study are -
Innovation driven organization
– Gm 905m07 is one of the most innovative firm in sector. Manager in GM in China - Abridged Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Gm 905m07 has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Gm 905m07 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.
Operational resilience
– The operational resilience strategy in the GM in China - Abridged 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.
Low bargaining power of suppliers
– Suppliers of Gm 905m07 in the sector have low bargaining power. GM in China - Abridged has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Gm 905m07 to manage not only supply disruptions but also source products at highly competitive prices.
Cross disciplinary teams
– Horizontal connected teams at the Gm 905m07 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.
Superior customer experience
– The customer experience strategy of Gm 905m07 in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Gm 905m07 digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Gm 905m07 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.
Sustainable margins compare to other players in Global Business industry
– GM in China - Abridged firm has clearly differentiated products in the market place. This has enabled Gm 905m07 to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Gm 905m07 to invest into research and development (R&D) and innovation.
Training and development
– Gm 905m07 has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in GM in China - Abridged 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.
High switching costs
– The high switching costs that Gm 905m07 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.
High brand equity
– Gm 905m07 has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Gm 905m07 to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Gm 905m07 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 David W. Conklin, Danielle Cadieux 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.
Weaknesses GM in China - Abridged | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of GM in China - Abridged are -
Slow decision making process
– As mentioned earlier in the report, Gm 905m07 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. Gm 905m07 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Gm 905m07 is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study GM in China - Abridged can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the GM in China - Abridged 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 Gm 905m07 has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study GM in China - Abridged, 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.
Products dominated business model
– Even though Gm 905m07 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 - GM in China - Abridged should strive to include more intangible value offerings along with its core products and services.
Aligning sales with marketing
– It come across in the case study GM in China - Abridged 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 GM in China - Abridged can leverage the sales team experience to cultivate customer relationships as Gm 905m07 is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Gm 905m07 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.
Low market penetration in new markets
– Outside its home market of Gm 905m07, firm in the HBR case study GM in China - Abridged needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Gm 905m07 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 cash cycle compare to competitors
Gm 905m07 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 bargaining power of channel partners
– Because of the regulatory requirements, David W. Conklin, Danielle Cadieux suggests that, Gm 905m07 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.
Opportunities GM in China - Abridged | 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 GM in China - Abridged are -
Leveraging digital technologies
– Gm 905m07 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Gm 905m07 can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Gm 905m07 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 Gm 905m07 to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Gm 905m07 can use these opportunities to build new business models that can help the communities that Gm 905m07 operates in. Secondly it can use opportunities from government spending in Global Business sector.
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. Gm 905m07 can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Gm 905m07 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Gm 905m07 is facing challenges because of the dominance of functional experts in the organization. GM in China - Abridged 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.
Creating value in data economy
– The success of analytics program of Gm 905m07 has opened avenues for new revenue streams for the organization in the industry. This can help Gm 905m07 to build a more holistic ecosystem as suggested in the GM in China - Abridged case study. Gm 905m07 can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Gm 905m07 can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. GM in China - Abridged 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.
Better consumer reach
– The expansion of the 5G network will help Gm 905m07 to increase its market reach. Gm 905m07 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.
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 Gm 905m07 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Gm 905m07 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, GM in China - Abridged, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Gm 905m07 can use the latest technology developments to improve its manufacturing and designing process in Global Business segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Threats GM in China - Abridged External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study GM in China - Abridged are -
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Gm 905m07 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 Gm 905m07 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. Gm 905m07 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. Gm 905m07 needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Gm 905m07 is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Regulatory challenges
– Gm 905m07 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.
Environmental challenges
– Gm 905m07 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. Gm 905m07 can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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 Gm 905m07.
Technology acceleration in Forth Industrial Revolution
– Gm 905m07 has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Gm 905m07 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.
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. Gm 905m07 can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
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 Gm 905m07 business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Gm 905m07 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.
Weighted SWOT Analysis of GM in China - Abridged 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 GM in China - Abridged 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 GM in China - Abridged 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 GM in China - Abridged 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 GM in China - Abridged 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 Gm 905m07 needs to make to build a sustainable competitive advantage.
