TNT Ltd.'s Logistics Services in Asia (A): The Strategy SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of TNT Ltd.'s Logistics Services in Asia (A): The Strategy
Meredith Hellicar's mission as general manager of corporate development is to make TNT Ltd. one of the biggest and most diverse transport and logistic companies in the world, with approximately $5 billion in turnover in 1993, a leading provider of logistics services in Asia. The case describes the approach she used to rank countries and select China and Thailand as priority markets. She has just presented her recommendation to the board when a major independent distributor in Indonesia contacts her for a potential partnership. She has to rapidly decide how to handle this unexpected opportunity and reconsider her priorities.
Swot Analysis of "TNT Ltd.'s Logistics Services in Asia (A): The Strategy" written by Michael Y. Yoshino, Carin-Isabel Knoop includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Tnt Hellicar's facing as an external strategic factors. Some of the topics covered in TNT Ltd.'s Logistics Services in Asia (A): The Strategy case study are - Strategic Management Strategies, Joint ventures, Marketing, Operations management, Risk management and Global Business.
Some of the macro environment factors that can be used to understand the TNT Ltd.'s Logistics Services in Asia (A): The Strategy casestudy better are - – there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, geopolitical disruptions, challanges to central banks by blockchain based private currencies,
banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of TNT Ltd.'s Logistics Services in Asia (A): The Strategy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in TNT Ltd.'s Logistics Services in Asia (A): The Strategy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tnt Hellicar's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tnt Hellicar'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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy can be done for the following purposes –
1. Strategic planning using facts provided in TNT Ltd.'s Logistics Services in Asia (A): The Strategy case study
2. Improving business portfolio management of Tnt Hellicar'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 Tnt Hellicar's
Strengths TNT Ltd.'s Logistics Services in Asia (A): The Strategy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tnt Hellicar's in TNT Ltd.'s Logistics Services in Asia (A): The Strategy Harvard Business Review case study are -
Training and development
– Tnt Hellicar's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in TNT Ltd.'s Logistics Services in Asia (A): The Strategy Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to recruit top talent
– Tnt Hellicar's is one of the leading recruiters in the industry. Managers in the TNT Ltd.'s Logistics Services in Asia (A): The Strategy are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Tnt Hellicar's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Tnt Hellicar's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Tnt Hellicar's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tnt Hellicar'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.
Strong track record of project management
– Tnt Hellicar's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Global Business field
– Tnt Hellicar's 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 Tnt Hellicar's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Tnt Hellicar'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.
Sustainable margins compare to other players in Global Business industry
– TNT Ltd.'s Logistics Services in Asia (A): The Strategy firm has clearly differentiated products in the market place. This has enabled Tnt Hellicar's to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Tnt Hellicar's to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Tnt Hellicar's 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.
Operational resilience
– The operational resilience strategy in the TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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.
High brand equity
– Tnt Hellicar's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tnt Hellicar's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Tnt Hellicar's 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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Weaknesses TNT Ltd.'s Logistics Services in Asia (A): The Strategy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of TNT Ltd.'s Logistics Services in Asia (A): The Strategy are -
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 Tnt Hellicar's supply chain. Even after few cautionary changes mentioned in the HBR case study - TNT Ltd.'s Logistics Services in Asia (A): The Strategy, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tnt Hellicar's vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Tnt Hellicar's 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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 Tnt Hellicar's has relatively successful track record of launching new products.
No frontier risks strategy
– After analyzing the HBR case study TNT Ltd.'s Logistics Services in Asia (A): The Strategy, 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 to strategic competitive environment developments
– As TNT Ltd.'s Logistics Services in Asia (A): The Strategy HBR case study mentions - Tnt Hellicar'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.
Capital Spending Reduction
– Even during the low interest decade, Tnt Hellicar's 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.
Aligning sales with marketing
– It come across in the case study TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy can leverage the sales team experience to cultivate customer relationships as Tnt Hellicar's is planning to shift buying processes online.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael Y. Yoshino, Carin-Isabel Knoop suggests that, Tnt Hellicar'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.
Interest costs
– Compare to the competition, Tnt Hellicar's has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study TNT Ltd.'s Logistics Services in Asia (A): The Strategy, in the dynamic environment Tnt Hellicar's has struggled to respond to the nimble upstart competition. Tnt Hellicar's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tnt Hellicar's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study TNT Ltd.'s Logistics Services in Asia (A): The Strategy can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities TNT Ltd.'s Logistics Services in Asia (A): The Strategy | 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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy are -
Learning at scale
– Online learning technologies has now opened space for Tnt Hellicar's to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Tnt Hellicar's in the consumer business. Now Tnt Hellicar's can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Tnt Hellicar's 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
– Tnt Hellicar's 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.
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. Tnt Hellicar's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Tnt Hellicar's is facing challenges because of the dominance of functional experts in the organization. TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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.
Buying journey improvements
– Tnt Hellicar's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Tnt Hellicar'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.
Better consumer reach
– The expansion of the 5G network will help Tnt Hellicar's to increase its market reach. Tnt Hellicar's 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.
Building a culture of innovation
– managers at Tnt Hellicar's can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Global Business segment.
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 Tnt Hellicar'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.
Creating value in data economy
– The success of analytics program of Tnt Hellicar's has opened avenues for new revenue streams for the organization in the industry. This can help Tnt Hellicar's to build a more holistic ecosystem as suggested in the TNT Ltd.'s Logistics Services in Asia (A): The Strategy case study. Tnt Hellicar's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Using analytics as competitive advantage
– Tnt Hellicar'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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tnt Hellicar's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats TNT Ltd.'s Logistics Services in Asia (A): The Strategy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study TNT Ltd.'s Logistics Services in Asia (A): The Strategy are -
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 Tnt Hellicar's.
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. Tnt Hellicar's needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
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. Tnt Hellicar's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Tnt Hellicar'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.
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 Tnt Hellicar's in the Global Business sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Tnt Hellicar'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.
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 Tnt Hellicar's business can come under increasing regulations regarding data privacy, data security, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Tnt Hellicar's 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.
Regulatory challenges
– Tnt Hellicar's 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.
Technology acceleration in Forth Industrial Revolution
– Tnt Hellicar's has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Tnt Hellicar'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.
Shortening product life cycle
– it is one of the major threat that Tnt Hellicar's is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Tnt Hellicar's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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 TNT Ltd.'s Logistics Services in Asia (A): The Strategy 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 Tnt Hellicar's needs to make to build a sustainable competitive advantage.
