Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society
For many decades, the automobile industry had played a major role in Canada's economy. A large portion of Canadian jobs depended on the auto industry, both directly and indirectly. However, by 2005, Canada faced serious globalization threats. Analysts were stating that in the future the number of automobile-related jobs in Canada would depend upon the international competitiveness of Canadian plants. To continue to increase wages would raise Canadian production costs so far above the levels in Mexico, China and other emerging nations, that the assemblers would shift production to low-cost jurisdictions. Meanwhile, the Big Three were losing market share to their non-union competitors, especially Toyota and Honda.
Swot Analysis of "Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society" written by David W. Conklin, Danielle Cadieux includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Canadian Canada's facing as an external strategic factors. Some of the topics covered in Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society case study are - Strategic Management Strategies, and Global Business.
Some of the macro environment factors that can be used to understand the Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society casestudy better are - – increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , central banks are concerned over increasing inflation, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels,
increasing inequality as vast percentage of new income is going to the top 1%, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Canadian Canada's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Canadian Canada'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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society can be done for the following purposes –
1. Strategic planning using facts provided in Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society case study
2. Improving business portfolio management of Canadian Canada'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 Canadian Canada's
Strengths Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Canadian Canada's in Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society Harvard Business Review case study are -
Effective Research and Development (R&D)
– Canadian Canada'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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Canadian Canada'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 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.
High brand equity
– Canadian Canada's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Canadian Canada's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Global Business field
– Canadian Canada'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 Canadian Canada's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Canadian Canada's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Canadian Canada'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.
High switching costs
– The high switching costs that Canadian Canada'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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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.
Highly skilled collaborators
– Canadian Canada'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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Low bargaining power of suppliers
– Suppliers of Canadian Canada's in the sector have low bargaining power. Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Canadian Canada's to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Global Business industry
– Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society firm has clearly differentiated products in the market place. This has enabled Canadian Canada's to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Canadian Canada's to invest into research and development (R&D) and innovation.
Innovation driven organization
– Canadian Canada's is one of the most innovative firm in sector. Manager in Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Canadian Canada'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 Canadian Canada's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society, is just above the industry average. Canadian Canada'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.
Low market penetration in new markets
– Outside its home market of Canadian Canada's, firm in the HBR case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, firm in the HBR case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Canadian Canada's 's lucrative customers.
High bargaining power of channel partners
– Because of the regulatory requirements, David W. Conklin, Danielle Cadieux suggests that, Canadian Canada'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.
Products dominated business model
– Even though Canadian Canada'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 - Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society should strive to include more intangible value offerings along with its core products and services.
Workers concerns about automation
– As automation is fast increasing in the segment, Canadian Canada'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.
Lack of clear differentiation of Canadian Canada's products
– To increase the profitability and margins on the products, Canadian Canada's needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society, in the dynamic environment Canadian Canada's has struggled to respond to the nimble upstart competition. Canadian Canada's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Canadian Canada'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.
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 Canadian Canada's supply chain. Even after few cautionary changes mentioned in the HBR case study - Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Canadian Canada's vulnerable to further global disruptions in South East Asia.
Interest costs
– Compare to the competition, Canadian Canada'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.
Opportunities Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society | 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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society are -
Better consumer reach
– The expansion of the 5G network will help Canadian Canada's to increase its market reach. Canadian Canada'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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Canadian Canada's 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.
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. Canadian Canada'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. Canadian Canada'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.
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 Canadian Canada'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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Canadian Canada's can use these opportunities to build new business models that can help the communities that Canadian Canada's operates in. Secondly it can use opportunities from government spending in Global Business sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Canadian Canada's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Canadian Canada'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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Canadian Canada's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Canadian Canada'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 Canadian Canada's to hire the very best people irrespective of their geographical location.
Building a culture of innovation
– managers at Canadian Canada'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.
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. Canadian Canada's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Canadian Canada's has opened avenues for new revenue streams for the organization in the industry. This can help Canadian Canada's to build a more holistic ecosystem as suggested in the Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society case study. Canadian Canada's can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Canadian Canada's in the consumer business. Now Canadian Canada's can target international markets with far fewer capital restrictions requirements than the existing system.
Learning at scale
– Online learning technologies has now opened space for Canadian Canada'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.
Threats Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society are -
Shortening product life cycle
– it is one of the major threat that Canadian Canada's is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Canadian Canada'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.
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 Canadian Canada's.
High dependence on third party suppliers
– Canadian Canada'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.
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 Canadian Canada's in the Global Business sector and impact the bottomline of the organization.
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 Canadian Canada's business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Canadian Canada's 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. Canadian Canada's can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Canadian Canada's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Regulatory challenges
– Canadian Canada'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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Canadian Canada's 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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society, Canadian Canada'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 .
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.
Increasing wage structure of Canadian Canada'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 Canadian Canada's.
Weighted SWOT Analysis of Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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 Canadian Canada's needs to make to build a sustainable competitive advantage.
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