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 - – cloud computing is disrupting traditional business models, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, challanges to central banks by blockchain based private currencies, technology disruption, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels,
wage bills are increasing, central banks are concerned over increasing inflation, 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 -
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Canadian Canada's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Canadian Canada'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.
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.
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.
Superior customer experience
– The customer experience strategy of Canadian Canada's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Canadian Canada's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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.
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.
Cross disciplinary teams
– Horizontal connected teams at the Canadian Canada'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.
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.
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.
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.
Organizational Resilience of Canadian Canada's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Canadian Canada's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
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 -
Slow to strategic competitive environment developments
– As Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society HBR case study mentions - Canadian Canada'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.
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.
Need for greater diversity
– Canadian Canada'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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Canadian Canada's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
No frontier risks strategy
– After analyzing the HBR case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society, 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.
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.
Increasing silos among functional specialists
– The organizational structure of Canadian Canada's is dominated by functional specialists. It is not different from other players in the Global Business segment. Canadian Canada's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Canadian Canada's to focus more on services rather than just following the product 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.
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.
Aligning sales with marketing
– It come across in the case study Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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 Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society can leverage the sales team experience to cultivate customer relationships as Canadian Canada's is planning to shift buying processes online.
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.
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 -
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.
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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Canadian Canada's is facing challenges because of the dominance of functional experts in the organization. Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society 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.
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.
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. Canadian Canada's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Canadian Canada's 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, Globalization Threatens Canada's Auto Industry: Implications for the Economy and Society, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Loyalty marketing
– Canadian Canada'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.
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.
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.
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.
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.
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.
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.
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 -
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. Canadian Canada'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.
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. Canadian Canada's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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.
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.
Consumer confidence and its impact on Canadian Canada'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
– Canadian Canada'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 Canadian Canada's in the Global Business sector and impact the bottomline 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.
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.
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.
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.
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.
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.
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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