Mekong Corporation and the Vietnam Motor Vehicle Industry (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Mekong Corporation and the Vietnam Motor Vehicle Industry (B)
At the time of the Mekong Corporation (Mekong) and the Vietnam Motor Vehicle Industry (A) case, product 9A96H002, some analysts felt that the Vietnamese automotive market was about to expand substantially. By 2007, the industry's capacity had increased enormously to nearly 150,000. However, the domestic sales had only expanded to approximately 40,000, and exports were negligible. This (B) case examines the government's interventionist policies that stimulated the expansion of production capacity while restraining vehicle sales. A key element was the continuation of very high import tariffs and other taxes that maintained a protected market for domestic manufacturers. In this context, Mekong continued to operate successfully. This case encourages students to consider the appropriate role of government in stimulating economic development, as well as appropriate corporate strategy in a protected market.
Swot Analysis of "Mekong Corporation and the Vietnam Motor Vehicle Industry (B)" written by David W. Conklin, Danielle Cadieux includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Mekong Vehicle facing as an external strategic factors. Some of the topics covered in Mekong Corporation and the Vietnam Motor Vehicle Industry (B) case study are - Strategic Management Strategies, Globalization and Global Business.
Some of the macro environment factors that can be used to understand the Mekong Corporation and the Vietnam Motor Vehicle Industry (B) casestudy better are - – digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, increasing inequality as vast percentage of new income is going to the top 1%, technology disruption, cloud computing is disrupting traditional business models, increasing energy prices, increasing household debt because of falling income levels,
customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Mekong Corporation and the Vietnam Motor Vehicle Industry (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Mekong Corporation and the Vietnam Motor Vehicle Industry (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Mekong Vehicle, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Mekong Vehicle 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) can be done for the following purposes –
1. Strategic planning using facts provided in Mekong Corporation and the Vietnam Motor Vehicle Industry (B) case study
2. Improving business portfolio management of Mekong Vehicle
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 Mekong Vehicle
Strengths Mekong Corporation and the Vietnam Motor Vehicle Industry (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Mekong Vehicle in Mekong Corporation and the Vietnam Motor Vehicle Industry (B) Harvard Business Review case study are -
Learning organization
- Mekong Vehicle 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 Mekong Vehicle is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Mekong Corporation and the Vietnam Motor Vehicle Industry (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Mekong Vehicle 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.
Ability to lead change in Global Business field
– Mekong Vehicle 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 Mekong Vehicle 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 Mekong Vehicle 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.
Highly skilled collaborators
– Mekong Vehicle 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Mekong Vehicle has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Mekong Vehicle to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Mekong Vehicle 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.
Organizational Resilience of Mekong Vehicle
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Mekong Vehicle does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Effective Research and Development (R&D)
– Mekong Vehicle 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Mekong Vehicle in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Successful track record of launching new products
– Mekong Vehicle has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Mekong Vehicle 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.
Training and development
– Mekong Vehicle has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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.
Weaknesses Mekong Corporation and the Vietnam Motor Vehicle Industry (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Mekong Corporation and the Vietnam Motor Vehicle Industry (B) are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Mekong Corporation and the Vietnam Motor Vehicle Industry (B), is just above the industry average. Mekong Vehicle 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.
Slow to strategic competitive environment developments
– As Mekong Corporation and the Vietnam Motor Vehicle Industry (B) HBR case study mentions - Mekong Vehicle 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Mekong Vehicle is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Mekong Corporation and the Vietnam Motor Vehicle Industry (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Workers concerns about automation
– As automation is fast increasing in the segment, Mekong Vehicle 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 Mekong Vehicle products
– To increase the profitability and margins on the products, Mekong Vehicle needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Mekong Vehicle 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Mekong Corporation and the Vietnam Motor Vehicle Industry (B), in the dynamic environment Mekong Vehicle has struggled to respond to the nimble upstart competition. Mekong Vehicle has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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 Mekong Vehicle has relatively successful track record of launching new products.
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 Mekong Vehicle supply chain. Even after few cautionary changes mentioned in the HBR case study - Mekong Corporation and the Vietnam Motor Vehicle Industry (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Mekong Vehicle vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Mekong Vehicle, firm in the HBR case study Mekong Corporation and the Vietnam Motor Vehicle Industry (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, David W. Conklin, Danielle Cadieux suggests that, Mekong Vehicle 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) | 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Mekong Vehicle 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, Mekong Corporation and the Vietnam Motor Vehicle Industry (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Mekong Vehicle can use these opportunities to build new business models that can help the communities that Mekong Vehicle operates in. Secondly it can use opportunities from government spending in Global Business sector.
Buying journey improvements
– Mekong Vehicle can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Mekong Vehicle can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Mekong Vehicle in the consumer business. Now Mekong Vehicle can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Mekong Vehicle 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.
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 Mekong Vehicle 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.
Loyalty marketing
– Mekong Vehicle 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Mekong Vehicle is facing challenges because of the dominance of functional experts in the organization. Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Mekong Vehicle 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.
Using analytics as competitive advantage
– Mekong Vehicle 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Mekong Vehicle to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Mekong Vehicle has opened avenues for new revenue streams for the organization in the industry. This can help Mekong Vehicle to build a more holistic ecosystem as suggested in the Mekong Corporation and the Vietnam Motor Vehicle Industry (B) case study. Mekong Vehicle can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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. Mekong Vehicle can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats Mekong Corporation and the Vietnam Motor Vehicle Industry (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Mekong Corporation and the Vietnam Motor Vehicle Industry (B) are -
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.
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 Mekong Vehicle in the Global Business sector and impact the bottomline of the organization.
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.
Regulatory challenges
– Mekong Vehicle 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Mekong Corporation and the Vietnam Motor Vehicle Industry (B), Mekong Vehicle 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Mekong Vehicle 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) .
Technology acceleration in Forth Industrial Revolution
– Mekong Vehicle has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Mekong Vehicle 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.
Environmental challenges
– Mekong Vehicle 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. Mekong Vehicle 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 Mekong Vehicle 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 Mekong Vehicle 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.
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 Mekong Vehicle 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 Mekong Vehicle 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.
Shortening product life cycle
– it is one of the major threat that Mekong Vehicle is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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 Mekong Corporation and the Vietnam Motor Vehicle Industry (B) 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 Mekong Vehicle needs to make to build a sustainable competitive advantage.